Cameron Hayes Cox was charged in a one-count Felony Information filed in federal court in Salt Lake City in June. At a sentencing hearing earlier this week, U.S. District Judge Dale Kimball sentenced Cox to a year in federal prison. Kimball also ordered him to serve 36 months of supervised release when he finishes his prison sentence.
According to the Felony Information, beginning in the spring of 2009, URS was introduced to representatives of a hedge fund based in London. A series of negotiations started between the parties concerning a potential agreement, and Cox, 28, was a member of the URS team responsible for collecting, reviewing, and analyzing information provided by the company, negotiating terms, and presenting a proposed agreement for consideration by URS to manage approximately $50 million of URS’ portfolio.
Cox admitted in his plea agreement with federal prosecutors that beginning in November 2009 and continuing through January 2010, he communicated with an individual in London using an anonymous identity to negotiate a “side deal” whereby he would be paid $150,000 by the investment manager to ensure URS approved the proposed agreement between the parties.
Under the side deal, the company would agree to pay Cox money to facilitate URS’ approval of the company as a third-party fund manager. Whatever his role on that due diligence team, he didn’t have the authority to bind the fund – and the hedge fund, after three months of negotiating with Cox – mentioned the proposed deal to URS. URS then told police, and the hedge fund cooperated in an ensuing Federal Bureau of Investigation sting.
URS officials say that no retirement trust funds were ever at risk during the course of Cox’s conduct and that he did not have the ability to take trust funds, nor the authority or influence to make the decision on whether to hire an investment manager. Moreover they say that the processes in place would not have allowed the improper hiring of an investment manager.
Law enforcement authorities believe Cox acted alone in this case and that no other URS employees were involved. URS worked closely with the FBI in the investigation of this case, and federal prosecutors said the investment manager and hedge fund, which are not identified in court records, reported the conduct and cooperated fully in the investigation.
James S. McTighe, Special Agent in Charge of the FBI in Salt Lake City, said, “For a public employee to attempt to negotiate this type of secret deal for personal gain is not only a violation of federal law; it’s a violation of the public’s trust. This case is an example of why public corruption is the FBI’s top criminal priority. Such illegal activity strikes at the heart of fair competition in the public sector. A public employee who promises contracts or business in exchange for a personal payout will find themselves in trouble with the FBI.”