On June 6, 1987, Intertech/Northeast, which specialized in financial and corporate investigations, was retained by Robert Gable, then head of the Republican Party of Kentucky, to investigate the relationship between Wallace Wilkinson and the late Jerome Jernigan. A month before the governor’s election, on Oct. 5, 1987, the Providence, Rhode Island-based company presented a 13-page report to Gable and Lexington attorney Bobby Wombles, who represented the Jernigan estate.
Originally, investigators were asked to concentrate on the alleged kidnapping and extortion of Wilkinson by Jernigan three years before. However, the investigation was broadened to include the complex financial dealings between the two men, as well as circumstances surrounding Jernigan’s death in 1984.
The report alluded to “scores of witnesses [who] have been interviewed and hundreds of pages of documents [that] have been collected.” It mentioned Italian investors and how they were able to get money to Wilkinson illegally through bogus log purchases from Jernigan’s wood-veneer business.
Rose Jernigan told the private investigators the plan was for payments to Wilkinson to be made by deposits into a Swiss bank account, avoiding taxes in the United States.
Wilkinson, Jernigan and a banker friend made trips to Italy. The report added that two Lexington women joined them later.
Wilkinson continued to do business with the Italian businessmen, and in 1978, several central Kentucky farms were purchased by newly formed corporations whose stock was then endorsed and transferred to entities in Switzerland.
The complexity of the transactions was such that even the U.S. Department of Agriculture struggled to determine the actual ownership of the farms, even though Wilkinson was listed as the owner and operator.
The investigative report revealed secretly recorded phone conversations; frequent Lexington meetings attended by Wilkinson, Italian investor Sergio Colombo and a Lexington prostitute; and witnesses so fearful of talking they were given code numbers. Two were known as W-3 and W-4. There may have been others, such as W-1 and W-2, but they are not mentioned in the report.
“Jernigan,” the report said, “had become increasingly bitter over his situation, jealous that Wilkinson was living a seemingly prosperous life from the proceeds of the Italian contacts Jernigan had arranged.”
The report continued:
“When Jernigan went to Wilkinson’s office to put the alleged kidnapping in motion, Jernigan said he revealed to Wilkinson pictures showing two women with Wilkinson and Colombo. He then told him he [Jernigan] was going to commit suicide. Wilkinson, [Jernigan] said, invited him to take a ride in an attempt to dissuade Jernigan from suicide.”
Today, Wombles has an interesting take on the bizarre episode. “There was never a kidnapping,” Wombles, still a practicing attorney in Lexington, told Kentucky Monthly in early November 2019. “I knew Jerome well enough that he gave me the whole story behind what happened. They did stay the night in Frankfort, but the next morning, they ate breakfast in the restaurant downstairs. If Wallace was being held against his will, he had several opportunities to get away when he went to the buffet alone.” Several waitresses later said that Wilkinson “acted normal,” according to Wombles.
“Jerome got in over his head when he met Sergio Colombo,” Wombles said. “Colombo came up with an idea to ship drugs overseas to sell. The plan was to hide them in the logs.”
By the mid-1980s, drugs had become a major criminal activity in the Lexington area. With some of central Kentucky’s elite right in the middle of the drug scene, it would be easy to make a connection that would lessen any chances of this being discovered. “Jerome thought Wallace might go for it,” Wombles said. “He told me he thought the two of them could make a ton of money.”
Jernigan’s attorney said his client and the future governor flew to Glasgow to collect money from the bank to be used as part of the scheme to ship logs with hidden drugs to Italy.
“When they got the money in Glasgow, Wallace was going to fly on to Louisville, and Jerome used the banker’s car to drive back to Lexington with the money,” Wombles recalled. “Wallace then had second thoughts and dreamed up the kidnapping story. I would have sworn that Wallace was never kidnapped.”
Jernigan’s association with the Italians, mainly Colombo, and their introduction to Wilkinson to invest in farms in central Kentucky were not working out to be as profitable as Jernigan and Wilkinson had hoped. Inflated land and log prices made it difficult for them to see any kind of return on their investments.
The summary report from the Rhode Island private investigator revealed the Italians lacked any knowledge of American land and commodity values, and that Wilkinson had induced the group to buy his cattle at “very high, over-market prices.”
The investigators reported that the Italians became upset. “I received a phone call from Sergio Colombo to meet him for breakfast at the Hyatt [hotel] downtown,” Wombles said. “It was short and to the point. He told me, ‘When you are business partners, and one of them does not do what is expected, it is not unusual to find him dead.’ I was shocked he said that. He stood up and left. I never heard from him again.”
In Wombles’ mind, Colombo was talking about his client, Jernigan, and he immediately told Jernigan of the meeting.
“I will probably be found dead now,” Wombles remembers Jernigan saying. “They have a way of making it look like a heart attack. Be sure to call the police if this happens.”
Several weeks before his death, Jernigan told his family, several attorneys and a Continental Inn employee that he feared for his life.
The investigators also revealed this in their report:
“On July 17, 1984, Continental Inn employee Ray Allen met Jernigan at approximately 7:30 p.m. in the hotel lobby as Jernigan was going to his room. Allen commented that Jernigan looked happier than he had seen him in the several months Jernigan had lived at the hotel. Jernigan told Allen he was happy because he had found the last piece of evidence he needed to clear himself [of the Wilkinson kidnapping]. Allen said Jernigan told him the evidence was in the blue binder with a University of Kentucky or Kentucky state seal he had in his hand as the two spoke. Jernigan then headed toward his room.”
Late the next evening, Jernigan’s son, Randy, found his deceased father at the Continental Inn.
The Lexington Police Department conducted an investigation. The state medical examiner performed an autopsy, and death was determined to have resulted from natural causes.
“Police came to my house that night,” Wombles said. “I told them of my meeting with Sergio Colombo and that Jerome had predicted the fact and manner of his death.”
The police report indicated that Wombles had told them there was no reason to suspect foul play, which the attorney later denied saying.
The private investigation revealed the Lexington police did not advise the medical examiner about Jernigan’s death predictions. Furthermore, the toxicologist was not directed to perform screens beyond those to determine the presence of alcohol or Valium and other routine tests.
And what about the blue binder the hotel employee had seen in Jernigan’s hand the night he died? It was never found.
“As far as I know, nothing else was ever done in Jerome’s death,” Wombles said.
“I really don’t know what [the private investigators’] purpose was, or what they did with the report,” Rose Jernigan said. “Bob Gable and the Republican Party hired the investigators to find out whatever they could about Wallace. I had nothing to do with hiring them. Bob did give me a copy of the report.
“I think they were just trying to get info as to Wallace’s business dealings, hoping to make him look as bad as possible and perhaps keep him from being elected governor.”
In November 1987, Wallace Wilkinson was elected Kentucky’s 57th governor.
Part I of this story appeared in the March 2020 issue.