By Billy Davis
The federal trial of former Tri-Lakes CEO Ray Shoemaker and Batesville businessman Lee Garner has been postponed due to the entry of a third defendant — who at present remains unnamed.

Citing the new defendant, U.S. District Judge Neal Biggers Jr. ordered the new trial date, moving the proceedings from October 31 to December 12 at the U.S. District Court of North Mississippi in Oxford.

Shoemaker attorney Steve Farese Sr. had petitioned the court to postpone the October trial for his client, citing the attorney’s involvement in a second federal trial in Greenville set for October 11.

The court order from Biggers, although it mentions Farese’s Motion for Continuance, states that the court is moving the trial due to entry of a third defendant in the federal investigation. The federal court sealed the name of that third defendant, most likely until that person is served with an indictment.

The October 31 trial date was moved from June 27 after attorneys for Garner requested more time to prepare for trial, citing more than 50,000 pages of government documents.  

Indictments were handed down by a federal grand jury in February and unsealed in March, with the trial originally set for May 7.

Shoemaker and Garner entered not guilty pleas to a 10-count federal indictment in March.

An FBI investigation alleges Shoemaker, Garner and David Chandler colluded to reward Chandler and later Shoemaker for using Garner’s business, Guardian Angel Nursing, at Tri-Lakes Medical Center.

Tri-Lakes receives funds for the federal Medicare and Medicaid programs, triggering the involvement of  federal agencies.

The 25-page federal indictment obtained by The Panolian alleges David Chandler, the former Panola County administrator, acted as a middleman and pocketed approximately $268,000 over two years from kickbacks.

Farese has said Chandler is cooperating with federal investigators and the U.S. Attorney’s Office in the case against his client. Chandler has not been indicted.

Federal investigators claim Chandler used his influence as county administrator to get Shoemaker a $50,000 raise at Tri-Lakes, then used his own bribe money from Garner to pay Shoemaker when the hospital CEO demanded $25,000 for increasing Guardian Angel’s billing hours. Shoemaker was allegedly paid approximately $12,000 toward the $25,000.

Shoemaker separately faces an embezzlement charge. Investigators allege he took $250,000 from a $4 million line of credit for Tri-Lakes — after claiming the monies were needed to keep the hospital in operation — and deposited the $250,000 in an account for his own use.

Investigators also allege Shoemaker diverted approximately $457,000 from a hospital in Humphreys County to an assisted living facility and real estate company he owned in Plantersville.

The indictment states that Shoemaker had already pocketed approximately $1.7 million in “management fees” from the hospital through his company, Rural Health Developers.

Shoemaker faces up to 80 years in prison, and $2.5 million in fines, if convicted of conspiracy, fraud,  embezzlement, and lying to federal investigators.  

Garner faces up to 25 years in prison and $1 million in fines if convicted of conspiracy and fraud.