By Sandy Davis
The Advocate (Louisiana)
Copyright 2006 Capital City Press
Entrepreneur Chuck Henderson spent years trolling the edges of the Texas business world, waiting for the big deal. But it remained elusive until Hurricane Katrina and FEMA blew into the Gulf Coast.
That’s when Henderson reeled in a big one: $12.5 million in FEMA contracts — with $7.5 million as profit for him and his two partners.
Henderson, a convicted felon who admits he had no experience operating an ambulance company, was paid by FEMA to provide ambulances to hurricane-stricken Louisiana.
But Henderson had no ambulances. Within days of getting the FEMA contract, he located GoldStar, a Texas ambulance company in hot water with the federal government. He leased the company’s vehicles.
For four months, GoldStar ambulances cruised the streets and sat in parking lots in Baton Rouge and elsewhere, and some wound up in Texas during Hurricane Rita. Several paramedics hired by Henderson claim the ambulances were poorly equipped, and a dispute with the company has left some unpaid for their services.
And though Henderson hit it big with the FEMA contract, much of the money he received has been locked down by a Texas judge trying to unravel his personal finances. Henderson severed ties with his two partners earlier this year when the three men disagreed how to divide the FEMA profits.
The Federal Emergency Management Agency has refused to disclose any information regarding the contract, including how the 72-year-old Henderson, president of C. Henderson Consulting Inc., got the contract in the early hours of Sept. 3.
Henderson also refused to be interviewed.
“I don’t have anything to say,” he said.
Several thousand miles southwest of FEMA’s Washington, D.C., office, details of the contract have been revealed over the past few months in an unlikely venue: divorce hearings in Houston.
Henderson, who has been married five times, is being sued for divorce by his second wife, Mary Ann McDaniel. The judge is determining whether to award her any of the FEMA profits.
McDaniel accuses Henderson of bigamy, claiming he never obtained a divorce from her even though he married two women — one of them twice — after leaving her. Henderson claims he got a Mexican divorce from McDaniel in 1999.
The divorce hearings have been held intermittently over the past few months. Each time one is held, the same small band of people regularly shows up.
Every one of them has a story to tell about their dealings with Henderson, and most aren’t flattering. Some claim he owes them money, and some hope they’ll get paid back.
But the FEMA contract has dominated the testimony, some of which points toward problems for Henderson.
Ken Ralston, McDaniel’s attorney, said in court that Henderson is being investigated by the Department of Homeland Security for “fraud in obtaining a FEMA contract.”
Henderson replied that he was unaware of the investigation. He did admit on the witness stand that he did not disclose being a convicted felon to FEMA.
“I didn’t think it was relevant,” Henderson said.
Henderson pleaded guilty in 1995 in Texas to engaging in organized crime and received a suspended 10-year sentence. Further details of the offense aren’t available.
Henderson also acknowledged he had no experience operating an ambulance company.
“But I had been working on an ambulance situation for three months prior” to getting the FEMA contract, Henderson said. He did not explain what he meant by that.
McDaniel, who has been married to Henderson for 24 years, said he never held a regular job during their marriage.
“I never knew how he made money,” McDaniel said outside court. “At first I thought he was a big businessman. But the more I was around him, I figured out that wasn’t true.”
A deal is born
For years, Henderson collected partners who worked with him on business ventures.
James Brannon and Richard Bell were his partners in C. Henderson Consulting, the company that handled the FEMA contract.
The two, now former partners, call Henderson a “rogue” and a “puffer.” They say Henderson has always had big ideas but never any money.
They also say they have no idea how Henderson got the FEMA contract.
“I agree that’s it’s pretty hard to understand how you can wake up one morning and know how to call FEMA and get a contract for something you’ve never done before,” Bell said in a recent interview.
Brannon said he also didn’t know.
“He told us he knew President Bush and Gov. (Rick) Perry (of Texas),” Brannon said. “But I was used to hearing that kind of thing from him. I didn’t believe it, but I still don’t know how he got the contract.”
In any case, on Sept. 3, 2005, just five days after Katrina struck her deadly blow, Henderson received an e-mail he claimed came from FEMA. Several employees say Henderson handed the e-mail to them as proof he had the contract.
The Advocate obtained a copy of the e-mail, which says that Henderson negotiated nearly all night with FEMA and finally was approved for funding by the agency at 8 a.m. He was to provide 50 ambulances in Louisiana for medical support services.
“When we got the contract, we didn’t have any ambulances,” Brannon said.
That’s when Henderson found a doctor who told him about GoldStar EMS, a Texas ambulance company under investigation by the FBI for fraud and tax evasion and on the verge of bankruptcy, Brannon said. Most of GoldStar’s fleet of ambulances was parked at the time, he said.
“Finding GoldStar at that point was a really good moment for us,” Brannon said.
The partners decided to lease GoldStar’s ambulances, he said.
The next problem was getting money to pay the paramedics and others to run the vehicles.
“FEMA is slow to pay,” Brannon said. “So we had to borrow money to pay our expenses until the FEMA money started coming in.”
But getting a loan turned into a difficult task.
“He’d been bankrupt recently,” Brannon said. “No one wanted to loan him anything. I had to go to Europe to borrow the money.”
The contract started out being a month-long contract. Ultimately, FEMA renewed it through the end of December.
For each month of the FEMA contract, Henderson paid himself a salary of $25,000, and Sheila, his current wife, received $5,000 a month as “executive assistant,” according to documents in the divorce case.
“As far as I know, Sheila did zero work with the FEMA contract,” Brannon said. “But she got paid.”
An incident in February caused the partners more problems. That’s when Henderson signed payroll checks totaling $256,993 to give employees their final paychecks for the FEMA contract.
But for reasons that remain unexplained, Henderson closed the checking account before the checks cleared. The checks bounced.
When asked in court whether he closed the account, Henderson was evasive. Finally District Judge Bonnie Crane Hellums found him in contempt of court, fined him $100 and ordered him to answer the question.
Henderson then admitted he did indeed close the account, causing the checks to bounce. Brannon and Bell had to cover them, he said.
Supplies and demands
Beyond the internal trouble at C. Henderson Consulting, there were also problems in the field, several paramedics who worked for the company say.
Tim Bloxom, an emergency medical technician with the Shreveport Fire Department, said he and others from his department worked for Henderson in the days before Hurricane Rita blasted ashore in south Louisiana.
“Let me just say it was a bad experience for most of us,” Bloxom said.
Bloxom said that after looking at the GoldStar ambulances, EMTs, paramedics and firemen wondered how they would deal with a real emergency if one arose.
“Part of the problem was that the ambulances were in such bad shape,” Bloxom said. “There were no heart monitors, any kind of drugs for cardiac arrest, or even things like saline or other basic fluids. There wasn’t even any oxygen on the trucks.”
At first, the lack of supplies on the ambulances didn’t really matter.
“Our first assignment was to work with the 82nd Airborne Division,” Bloxom said. “But there was nothing to do there. They were wrapping up. We did nothing for days, and then finally we took our ambulances and followed the 82nd Airborne while they cleaned drains in New Orleans.”
But as Hurricane Rita gained power, roaring across the Gulf, officials in Texas and Louisiana did not want to make the same preparedness mistakes they made before Hurricane Katrina.
Henderson’s team sent the ambulances back to Louisiana’s Bureau of Emergency Management Services in Baton Rouge for reassignment.
“After we signed in there, they dispatched us to Port Arthur and Beaumont to help evacuate people from hospitals and nursing homes,” Bloxom said. “That’s when things went downhill fast.”
The Shreveport paramedics went to GoldStar’s home office in Port Arthur, Texas, to get what they believed would be much-needed supplies.
“But they had no supplies whatsoever to stock the units with,” Bloxom said. “All we got was the bare essentials. There were critical patients in the hospital in Beaumont. We didn’t have the equipment to move them. We didn’t have anything to monitor them with.”
As the paramedics worked furiously to evacuate the hospitals and nursing homes, Henderson found out his ambulances were in Texas and not Louisiana, Bloxom and others said.
“He called us and threatened to have us arrested and pull our EMT certification if we didn’t return the ambulances to Louisiana,” Bloxom said. “We were piled up with people in Beaumont who were trying to be evacuated. The local police and firefighters were begging us to stay. At the same time, Henderson is screaming at us to leave. I can’t tell you how awful that was.”
The men finally returned to Baton Rouge Friday morning — before Rita came ashore — dropped off the ambulances and went back to Shreveport.
“Most of us got paid,” Bloxom said. “But there were a couple of guys Henderson refused to pay.”
Henderson had agreed to pay Shreveport’s paramedics $480 a day, Bloxom said.
Henderson also promised to pay nine Oregon paramedics and firefighters who were recruited to work for Henderson. Lt. Neale Brown of Tualatin Valley Fire and Rescue in Oregon was one of them.
“The first thing that raised questions for us was when teen-agers picked us up at the airport driving the ambulances. That was odd,” Brown said. “And then the ambulances were in terrible shape. They had outdated medications and very little oxygen. How can you run an ambulance without oxygen?”
Brown, like Bloxom, was assigned to the 82nd Airborne Division in New Orleans as Hurricane Rita hurtled toward Louisiana.
“Once Rita was headed this way, we were sent back to Baton Rouge to the EMS headquarters,” Brown said. “From there, we were sent to Port Arthur, Texas, to evacuate people in hospitals and nursing homes.”
For 24 hours, the Oregon paramedics evacuated people.
“As soon as Mr. Henderson found out we were in Texas, he called us, screaming at us, ordering us to return to Louisiana,” Brown said. “He said if the ambulances weren’t in Louisiana, he wouldn’t get paid. When we didn’t go back right away, he told us he’d reported to the State Police that we’d stolen his ambulances. He was trying to get us arrested.”
As soon as the Oregon paramedics returned to Baton Rouge, they resigned and Henderson refused to pay them.
Bell, one of Henderson’s former partners, insists the Oregon paramedics were fired.
“They stole our ambulances, and it cost us over $90,000 in billing to the government,” Bell said. “Who knows how many people were hurt by their actions?”
The paramedics insist they were dispatched by the state to Texas.
The Oregon paramedics said they didn’t mind not being paid.
“We planned on coming down there as volunteers,” Brown said.
But the men did tell U.S. Sen. Ron Wyden of Oregon about their experience.
“The senator has called for an investigation by the Department of Homeland Security into Henderson Consulting,” said Geoff Stuckart, a spokesman for Wyden.
Deal, no deal
The courtroom brawl over the FEMA contract profits ended a long relationship between Henderson and Brannon.
Brannon said he met Henderson on a golf course in the late 1990s.
“He told me he used to be worth $160 million but had lost all of his money,” Brannon said.
Nonetheless, Brannon said, he decided to join forces with Henderson “because I believed he could make us some money.”
Brannon said that over the past nine years, he created nine corporations for the host of business ventures Henderson came up with.
“Every deal started out to be a 50/50 split on the money between Chuck and I,” Brannon said. “But that always changed when he sniffed the money. His greed genes would kick in.”
Among the business deals they tried: buying a shipload of oil from Nigeria to sell in the United States, selling long-distance telephone service to Christians, developing golf courses and properties, building hotels for patients to recuperate in after transplants and buying a fleet of trucks to transport medical imaging machines to remote areas of Texas.
“We had televangelists set up to endorse us on their shows to sell the long-distance service to Christians,” Brannon said. “The televangelists were going to get a cut of the money. I don’t know what happened, but that fell through.”
And when the captain from the Sette Bello, the Nigerian oil tanker, called to say he was nearing the coast of Florida and needed $100,000 wired to him, Brannon and Henderson thought something was amiss.
“We tracked down the owners of the ship and found out the real Sette Bello had just passed through the Suez Canal,” Brannon said. “Our ship was a fake.”
Henderson also went to Port Lavaca, Texas, telling people about a plan he had: a multimillion-dollar development that would include a 500-acre resort, two golf courses, a country club, health spa, retirement community and shopping mall.
Jessica Cunningham, a Port Lavaca real estate agent, was one of the locals Henderson met.
“The first thing he did was pray with us,” she said. “Then he preyed on us.”
Henderson claimed on a résumé he gave to Cunningham that he built Harbourtown Golf Course in Hilton Head, S.C., from 1969 to 1970.
Bonnie Hunt, who sets up tournaments for Harbourtown, said the course was completed in early 1969, adding she has never heard of Henderson. She said it was designed by Pete Dye and Jack Nicklaus, and Dye’s company built it.
Henderson also claimed on the résumé that he built the Playboy Club in Lake Geneva, Wis., between 1970 and 1973. But Helen Brandton, the curator of the museum and library in Lake Geneva, laughed when asked about the Playboy Club’s history.
“I don’t think someone was building it between 1970 and 1973,” she said. “The Playboy Club opened in May 1968. I’ve never heard of a Chuck Henderson.”
Henderson’s résumé also says he drilled over 8,000 oil wells worldwide, built four pipelines and plugged 1,000 well fires in Kuwait in 1994.
“I was living with Chuck then,” said Mary Ann McDaniel, his second wife. “He never went to Kuwait in 1994. I’m sure of that.”
Cunningham said she never confirmed the information on the résumé and was swayed by Henderson’s big plans.
“I let him and Sheila live in a condo I owned while we worked on the development,” Cunningham said.
She also bought land for the development.
“Somehow, though, I paid for it and the land ended up in Chuck’s name,” she said.
That deal collapsed when Henderson never came up with any money, Cunningham said. Cunningham sued Henderson and was awarded a judgment against him.
“But he still hasn’t paid me,” she said.
Over the years, Brannon said, Henderson never put up any money for the business ventures the two were involved in.
“Not only did he not put up any money for anything, I had to loan him $150,000 so he could buy groceries and pay his bills,” Brannon said. “I’m the only person who stood behind him all of those years.”
Frozen assets
In the Houston courtroom June 16, Henderson leaned back in the witness chair as he described to the judge his latest business ventures.
At stake was more than $1 million in FEMA profits claimed by Henderson but seized by the judge.
Henderson and his attorneys were trying to convince the judge to release at least some of the money.
Henderson told the judge about recently taking a group of ministers who lost their homes in Hurricane Katrina to a five-star hotel in Tennessee for a retreat. He said that cost him more than $100,000.
And in early spring, Henderson said, he donated $150,000 to Oasis of Hope Hospital in Mexico.
He also told her about starting up a new ambulance business, Lifeline EMS, and buying a second ambulance company, Pride EMS.
He told the judge he now had 18 ambulances between the two companies.
But Henderson didn’t know the owner of Pride EMS was going to show up that day as a surprise witness.
“Every agreement we had is a lie or has fallen through,” testified Steve Winnett, the owner of Pride EMS. “I’m changing the locks to my offices today to keep Mr. Henderson out.”
The judge asked Winnett whether Henderson owned or had access to 18 ambulances.
Winnett said, “No, he does not. That’s not true.”
While Winnett was answering the question, the judge found a document on her desk that shows Henderson reported his income as $674 a month in Social Security benefits.
With that, the gavel came down, the judge appointed a receiver to run Henderson’s businesses and the hearing ended.
“With all due respect,” the judge had said earlier, “I’m concerned about what this guy’s going to do with the money.”