Jeff Thompson
Jeff Thompson

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Jeff Thompson in 2015 isn’t much to envy. The one-time Wilson Building puppetmaster piles up legal fees while he waits to testify in a possible criminal case against former Mayor Vince Gray. After that, if he’s lucky, he’ll be under house arrest for half a year.

Once at the top of a network of illegal straw donors spread across the country, he now has to ask a federal judge for permission to leave the D.C. area. The man once nicknamed “the Governor” now barely rates above dog catcher.

Jeff Thompson in 2006, though—that guy had it made. Thompson’s D.C. Chartered Health Plan held a city Medicaid contract worth hundreds of millions. Adrian Fenty, the mayor who would give him the most trouble with that contract, wasn’t in office yet. And Thompson had just started a string of illegal “shadow campaigns” in District politics that would go undiscovered for years.

But District pols weren’t the only beneficiaries of Thompson’s largesse that year. 2006 was also the year that, according to documents uncovered by LL, Thompson made an unusual investment—or a gift, depending on whom you believe now—worth more than $1 million in a Brookland private school.

Thompson’s dip into pedagogy had a connection to the District government: The school was controlled by the wife of a former top District health official who played a role in Thompson’s success. Some of the school’s funds, in Thompson’s telling, went to buying trips and a car for that official’s wife.

In 2000, Thompson, already a successful accountant, bought Chartered at a bargain for $4 million. But before he could take control of the company that would make him even richer, the District’s Department of Health needed to approve the purchase.

Enter Ivan Walks, DOH director under then-Mayor Anthony Williams. “I just had to kind of make sure the health department signed off when it needed to sign off,” Walks tells LL.

Walks’ tenure at DOH helped Thompson in other ways, too. Walks’ online biography describes him as “intimately involved” in starting the D.C. Healthcare Alliance, a program that extended health coverage for low-income residents and involved Chartered. A few years after Thompson bought Chartered, according to a July 2013 Washington Post story on Thompson, Chartered had more than quadrupled its number of enrollees.

Walks left DOH in 2002, but continued a friendship with Thompson. According to court documents filed on behalf of Dawn Kum, Walks’ wife until their 2011 divorce, the three regularly exchanged gifts.

“Throughout the friendship of the three, each provided things to each other without agreement, reimbursement, or payment,” one court filing reads.

LL has to get a friend like Thompson, because what comes next was a hell of a gift. In 2006, according to Kum, she asked Thompson for $1,058,744.00 for Village Academy of Washington D.C., a school for children with special needs that she runs.

(The same year, Thompson also routed the much smaller sum of $8,000 to a separate company owned by Kum. The cash came through an unusual routing arrangement Thompson had with ubiquitous Wilson Building lawyer-slash-lobbyist David Wilmot, a relationship previously reported by Washington City Paper.)

Thompson gave the money to Village Academy, but didn’t give the money personally. Instead, he began sending funds from D.C. Healthcare Systems Inc., a holding operation that controlled Chartered and other Thompson companies. By the end of 2008, according to court documents filed by Thompson’s attorneys, DCHSI had sent $1,386,743.74 to Village Academy.

Whether Thompson was entitled to spend that money could become a matter for the courts. Since 2013, Chartered, now in receivership, has been suing Thompson and DCHSI for allegedly siphoning money out of the Medicaid contractor with loans and suspicious contracts to other Thompson-owned companies. Thompson has denied his former company’s charges, and is suing the District for $80 million for taking Chartered from him.

Just what Thompson’s money went towards at Village Academy isn’t clear. LL contacted Kum, as well as attorneys for both her and Thompson, but didn’t receive any comment.

What is clear, though, is that Thompson isn’t happy with how Kum managed Village Academy. In a December 2013 arbitration claim, he alleges that Kum’s school spent $96,975 on a Land Rover for her and $87,000 on travel in 2011. Some of the school’s funds, according to Thompson’s lawyers, went to “personally benefit Dawn Kum.”

Walks says he has never been involved with Village Academy, and says he didn’t know about any gifts his then-wife’s school received from Thompson.

“I have no idea what Dawn was doing, or who she was doing it with,” Walks says.

LL can’t blame Walks for being confused. Not even Kum and Thompson agree on what their arrangement really was. Years after the payments started, according to Kum, Thompson asked her to treat DCHSI’s “gift” as an investment for his own tax purposes.

“He needed some tax deductions and asked if the money he gave for the Village Academy could be treated as an investment,” Kum said in an affidavit filed last March.

Kum agreed, and in 2011 the two finished a contract giving Thompson a 36 percent stake in the school. Thompson insists that the 2006 gift was always an investment that was just formalized in 2011.

These days, Thompson isn’t seen as the most trustworthy guy in the District, much to the chagrin of any potential prosecution against Gray. Still, there’s some evidence to back up his claim: In 2006, Kum sent Wilmot and Thompson an email about the money with the subject line “Investment Agreement,” according to court papers.

By 2012, though, Thompson didn’t have money left to splash around on investments-cum-tax-deductions or gifts. After Thompson was fingered as the top money man behind the illicit 2010 shadow campaign to elect Gray, the FBI raided Thompson’s home and office. Even as Thompson brought on top defense attorney Brendan Sullivan, his lucrative businesses began to dry up.

Presumably looking for that $1 million he’d invested or given to Kum’s school, he tried to withdraw his money. The school paid back some of it, then stopped, launching a years-long legal battle with Thompson and DCHSI that is still ongoing. The court battle has gone Thompson’s way so far, but Kum isn’t eager to part with her supposed gift.

All of which makes LL wonder: If you can’t trust a friend who takes $1 million from you, who can you trust?

Photo by Darrow Montgomery