Denver PR guy Charlie Russell has always managed crises. Now he’s in a PR crisis of his own.
He admits he paid $2,500 to Audrey Lewis, a woman who wrote and said flattering things about his client, Richard Scrushy, the legally embattled founder of Birmingham, Ala.-based HealthSouth.
Russell, 65, denies that the money was for her statements. But the payment raises ethical questions about Scrushy’s PR strategy during a trial at which he was acquitted on fraud charges.
Another question: How did a Denver PR guy come to represent a famous corporate-fraud defendant in Alabama?
The trail leads to Will Hoover, the Cherry Creek financial adviser who was sentenced to 100 years in prison for fleecing his clients. In the spring of 2004, while Hoover was free on bail, he started a company called Executive Recovery Partners. The company offered comprehensive services for alleged swindlers, including expert witnesses, public relations and psychological counseling.
Hoover told me he planned to make millions defending accused corporate executives, and that the money he earned would repay his victims. I didn’t believe him. But Hoover insisted he had some hot leads, including Scrushy.
After Hoover got an audience with Scrushy, he called Russell, well-known for handling PR on disasters such as plane crashes and tobacco lawsuits. Hoover introduced Russell to Scrushy.
I’ve known Russell for years. We often have lunch together at a dive taqueria on West Alameda Avenue. He never offered me money. So why did he give it to the Alabama woman last spring?
“I am a sucker for a hard-luck story,” Russell told me Thursday. “This lady was crying; she had two little kids all dressed up to go out of town to a funeral. … She didn’t have any money. … So I wrote her a personal check.”
Russell faxed me a signed contract, dated May 24, that pays Lewis $2,500 “in advance” to do community-relations consulting work – to be done after the Scrushy verdict, which came June 28.
This work was never done, said Lewis, whom I spoke to by phone Thursday. She contradicted almost everything Russell had told me. “I was not crying, and I didn’t have my children,” she said.
She said she signed the contract but believed Russell was really paying her for what she had already written and said about Scrushy.
“I don’t even know Scrushy,” Lewis said. “I wasn’t even from Birmingham.”
She said she went to the Scrushy trial with members of her church and became engaged in Scrushy’s PR campaign. Lewis submitted several articles to the Birmingham Times, a small but influential newspaper serving the black community. Lewis also waxed to journalists about Scrushy: “In the community, he’s known as a help to people in need of assistance,” Lewis was quoted by Bloomberg News in February.
Lewis claims that while she was making these statements, Scrushy paid her $11,000. She claims this money was funneled to her through an Alabama-based PR firm called the Lewis Group (no relation to yours truly or to Audrey Lewis).
The Lewis Group’s owner, Jesse J. Lewis Sr., denied being part of the scheme. Jesse Lewis is also the founder of the Birmingham Times, and his son, James, runs the paper.
James Lewis told me his paper routinely runs articles from community members. “I didn’t know she was getting paid for them,” he said. If the allegations are true, Scrushy “could have run ads in the paper cheaper than that.”
It’s not a crime to pay people to spin newspaper stories. But Scrushy is already in trouble for allegedly greasing other skids. In October, he was indicted for allegedly paying Alabama’s former governor for a seat on the state health regulatory board. He has pleaded not guilty.
As for Russell, it’s not clear if he crossed ethical lines, said Jeff Julin of MGA Communications in Denver, who has helped develop an ethics code for the Public Relations Society of America.
But he said: “It’s important that PR people be mindful of even the perception of impropriety.”
Russell was besieged with phone calls from reporters Thursday. “I’m just going to have to take the heat,” he said.
Al Lewis’ column appears Sunday, Tuesday and Friday. Respond to Lewis at , 303-820-1967, or alewis@denverpost.com.
