Former South Pittsburg Mayor Mike Killian Charged By Federal Authorities For Illegal Gambling; Is Brother Of U.S. Attorney Bill Killian; He Agrees To Plead Guilty

Wednesday, February 27, 2013
Mayor Mike Killian
Mayor Mike Killian

Former South Pittsburg Mayor Mike Killian has been charged by federal authorities for illegal gambling. He has agreed to plead guilty to the charge.

He is the brother of U.S. Attorney for the Eastern District of Tennessee Bill Killian. The indictments and complaints are usually signed by Bill Killian, but this one was signed by Jack Smith, chief of the Public Integrity Department of the U.S. Department of Justice. Trial attorneys are listed as Mark Angehr and Barak Cohen, who are not associated with the Bill Killian office.

Mike Killian faces up to five years in federal prison and a fine up to $250,000 or twice the amount of the pecuniary gain.

The complaint says from 2004 to January 2013, Mike Killian managed an illegal gambling operation with revenues of as much as $2,000 per day. Some of the gambling started as early as 1988.

The operation included video gambling, sports betting and an "outlaw" lottery - all of which violate state law, it was stated.

The complaint says the "outlaw" lottery involved placing illegal bets on legal state lotteries.

A raid was conducted on the Killian operation on Jan. 15.

Authorities said Killian ran the sports betting operation through an individual identified only as Person A."

The complaint says two video gambling machines containing $2,786 were found at the Lotto Mart, 519 E. 12th St., South Pittsburg, and $3,000 was found in a safe.

It says $11,609 in cash was seized from Mike Killian Wholesale Fireworks, 1505 S. Cedar Ave., South Pittsburg. It says $21,080 was seized from a safe. Two laptop computers and two desktop computers were confiscated.   

As a part of the plea deal, Killian agreed to the forfeiture of all the money and property.

In the plea agreement, Killian said he knew that the gambling operations were illegal.

From about 2007 to January 2013, the gambling machines at the Lotto Mart were located in a separate room with a door marked "Private". Income was between a few hundred to several thousand dollars a week.

The agreement says the illegal betting operation started in 2002 with Person A running it and dividing the proceeds evenly with Killian. In case Person A did not have enough cash to pay off winning bettors, Killian supplied the money. Person A either personally paid off the winners or left envelopes filled with cash at the Lotto Mart.

From 2002 until the recession in 2008, the sports betting operation yielded about $45,000 per year that was split between Killian and Person A.

In October 2012, Killian set up an account with OutlawLine.com - a sports betting site owned out of Costa Rica - and Person A received sports bet through the account until January.

The outlaw lottery began in 1988 and yielded $50 to $60 per day. It involved bets placed on lotteries in Tennessee, Georgia and illinois.

Mike Killian was mayor of South Pittsburg until 2004 until 2012.

He considered running for state Senate in 2007 when the seat was vacated by Ward Cruchfield, but decided against it.

Killian is represented by Chattanooga attorneys Lee Davis and Bryan Hoss.


3rd Edition Of Popular Stokes Photo Book To Be Issued

With a second edition of the popular Stokes Photo Book selling out, Chattanoogan.com will publish a third edition of 1,000 copies. John Wilson, publisher, said, "We continue to get calls and emails inquiring about the availability of this remarkable Chattanooga photo collection. So we have asked College Printing at Collegedale to put the almost 600-page book back on the presses. ... (click for more)

Fire Damages Vacant Home On Camden Street

Chattanooga firefighters were called to a house fire around  7:30  Sunday morning at 2105 Camden Street. Captain David Brooks with Engine 4 said smoke and flames were visible when they arrived. The firefighters got the fire out fairly quickly. No injuries were reported. Captain Brooks estimated the loss at $15,000. The owner of the house told firefighters that ... (click for more)

Obama Doesn't Want You To Save For College

Over the past few decades, federal aid for post-secondary education has decreased and transitioned largely from grants to guaranteed student loans.   At the same time, the cost of college has far exceeded the cost of inflation creating a situation in which college has become less affordable and causing students to pile up debt that is at an all-time high.   This debt ... (click for more)

Roy Exum: The Great Peace Pipe

There is a serious rift between our state legislators and Erlanger Hospital that has me worried. If I worry about something, it doubles the power of the worry. My problem? I am convinced we have the best collection of people at the State Legislature in Nashville we’ve ever had – I adore each of them. I am also blessed to believe Erlanger is back on track and, after a sensational ... (click for more)

Notre Dame Earns State Duals Berth With 45-33 Win

The Notre Dame wrestling team is peaking at the right time. It's been an up and down season for the Fighting Irish and for the first time all year, they have a full lineup. And now they can start making plans for next weekend's State Duals in Franklin after beating East Ridge for the second time in three days. The Irish beat East Ridge by eight points on Thursday night ... (click for more)

UTC Wrestlers Top VMI, 35-3

Highlighted by a victory at 285 pounds in a battle of the unbeatens, Chattanooga defeated visiting VMI, 35-3 Sunday afternoon at Maclellan Gym. In the final match of the day (285), UTC's Jared Johnson (24-6, 4-0) edged Juan Adams (16-10, 4-1), 9-7. Johnson, who has now won eight straight, used two takedowns and a 2-point near fall to lead 6-1 after one period and needed ... (click for more)