Third person indicted in water rights bribery scheme

A Clark County grand jury Wednesday indicted a third defendant in a
$1.3 million bribery scheme over the sale of Virgin River water rights to the Southern Nevada Water Authority.

Michael Winters, 56, the former general manager of the Virgin Valley Water District, was added as a defendant in a 51-count superseding indictment.

Two other former water officials — Robert Coache, 52, and Michael E. Johnson, 51 — were previously charged. Both are free on $250,000 bail.

All three men are accused of taking bribe money to help wealthy Bunkerville landowner John Lonetti Jr. sell the water rights for $8.4 million in 2008. Lonetti, 77, has not been charged, and the water authority cooperated in the investigation.

Coache is a retired deputy state engineer with the Nevada Division of Water Resources, and Johnson is a former chief hydrologist for the Virgin Valley Water District.

The indictment alleges Winters unlawfully received $15,000 in the scheme.

Winters, who was in District Court when the indictment was returned, declined to comment afterward.

His lawyer, T. Augustine Claus, said in court that Winters received no benefit in the scheme. Claus argued the $15,000 was a loan that Winters had paid back.

But Chief Deputy District Attorney Marc DiGiacomo responded that Winters didn’t pay back the majority of the money, $10,000, until recently, after he was told that he was a target of the grand jury.

District Judge Linda Bell set bail at $50,000 and ordered Winters to post it by Friday or face arrest. His arraignment was set for Dec. 27 before District Judge Abbi Silver.

Winters was indicted last year in an unrelated case on a charge of misconduct by a public officer. He was accused of orchestrating a land deal in which the Virgin Valley Water District paid an inflated price to buy land for an arsenic treatment plant.

Water district board members fired Winters, a 16-year employee of the agency, in February 2010 after they learned police were investigating the land deal. His trial on the misconduct charge is set for April 2 before District Judge Michael Villani.

In the water bribery case, Coache and Johnson are accused of spearheading the scheme between Jan. 1, 2006, and May 21, 2008, while both men had their public jobs.

They are accused of laundering the money they received from Lonetti through a series of transactions, including the purchase of several homes.

Prosecutors have obtained rare court orders for police to seize both homes. Police have not taken possession of the homes, but they have filed the seizure orders in court to prevent the defendants from selling the properties.

Coache retired from the state in May 2010, and Johnson resigned under fire from the water district in August.

Their trial is set for May 7 before Silver.

The water district supplies about 23,000 residents, ranchers and farmers in the northeastern corner of Clark County. Its service area includes the communities of Mesquite and Bunkerville, 85 miles northeast of Las Vegas.

Contact Jeff German at jgerman@reviewjournal.com
or 702-380-8135.