Crime

Justice Department Watchdog Levels Misconduct Charges Against Former Whitefish Police Chief

Bill Dial, who abruptly retired earlier this month, allegedly conspired to entrap a fellow officer, lied to state and federal investigators, and provided an unvetted civilian — who is now charged with federal crimes — illegal access to the department’s facilities and investigative materials

By Tristan Scott
U.S. Attorney General William Barr poses for pictures with Whitefish Chief of Police Bill Dial, left, and others in Kalispell after a roundtable discussion with local law enforcement on combatting Montana’s meth crisis on Nov. 22, 2019. Hunter D’Antuono | Flathead Beacon

The state Justice Department’s watchdog bureau responsible for overseeing law enforcement training and certification in Montana has leveled damning allegations of official misconduct against former Whitefish Police Chief Bill Dial, who retired abruptly earlier this month after leading the department for two decades.

The allegations against Dial are detailed in a 12-page complaint by the Montana Public Safety Officer Standards and Training Council, or POST, and are supported by evidence including hundreds of text messages exchanged between Dial and Matthew A. Marshall, the CEO of a Whitefish-based security firm now under federal indictment for aggravated identity theft, wire fraud, money laundering, and tax evasion.

According to the Aug. 25 POST complaint against Dial, which the Beacon obtained through a public records request, the former police chief “engaged in, condoned, and/or failed to disclose to appropriate authorities, acts of corruption.” The sprawling complaint accuses Dial of colluding with Marshall to entrap a fellow Whitefish police officer; falsifying information and lying to city, state and federal investigators; and allowing Marshall, an “unvetted civilian with no POST certification or law enforcement credentials,” physical access to the Whitefish Police Department, access to information on confidential and ongoing police investigations, and access to confidential criminal justice information that is protected by state law.

This week, POST also opened a separate investigation into allegations of misconduct by Interim Whitefish Police Chief Bridger Kelch, who assumed the department’s top leadership position following Dial’s abrupt retirement on Aug. 4, a decision he announced in an email to colleagues without further explanation. The complaint against Kelch, which the Beacon also obtained through an open records request, is much narrower in scope and alleges that Kelch, as assistant police chief, was complicit in some of the alleged misconduct involving Dial and Marshall.

In Dial’s case, the former police chief was given a Sept. 29 deadline to respond to the allegations laid out in the complaint, after the POST council on Aug. 24 voted to afford him the opportunity to voluntarily surrender his POST certifications, which are required to work as a public safety officer in Montana, or to contest them in writing. In Kelch’s case, the city of Whitefish must complete its own investigation within 30 days of receiving notice from POST.

Neither Dial nor Kelch have responded to the Beacon’s requests for interviews.

According to Whitefish City Manager Dana Smith, city officials first learned of the allegations against Kelch on Aug. 25, after the POST council approved a letter to the city detailing the accusations. The letter prompted city officials to open a requisite investigation into Kelch; however, Smith wrote in an email to the Beacon that, based on her initial review, “the allegations do not appear to be substantiated and include assumptions without documented evidence.”

“The city will complete a full, independent investigation and provide a response to POST within the required timeframe,” Smith stated.

Smith did not provide any comment regarding the allegations against Dial, nor did she elaborate on the circumstances surrounding his retirement, noting only that he is no longer employed by the city of Whitefish. However, she stated: “The city continues to have full faith and confidence in Interim Chief Kelch’s ability to lead our Whitefish Police Department with integrity and with our community’s public safety as the highest priority.”

The allegations detailed in the POST complaint against Dial are also born out in hundreds of pages of documents the Beacon obtained through multiple public records requests, including text messages and emails between the former police chief and Marshall, most of them occurring between December 2016 and December 2018. Those messages reveal a burgeoning friendship between Dial, a career lawman, and Marshall, a criminal defendant who investigators allege has lied for years about the extent of his military, law enforcement and intelligence background. The messages show the men routinely golfed, drank and ate together; embarked on excursions to Las Vegas; and exchanged racially charged barbs about friends and acquaintances, including other members of the police department.

Several of the messages sent from Dial’s city-issued cell phone include racial epithets and comments that prompted the city of Whitefish to offer a condemnation of Dial’s behavior.

“The substance of some of the text messages sent from former Police Chief Dial’s City-issued cell phone do not align with our City’s values of tolerance, respect, inclusivity, and equality,” Smith, the city manager, stated in an email. “Those text messages are not a representation of the City or the Whitefish Police Department.”

Still, the POST complaint details a complex scheme that began unfolding in August or September 2018, when Marshall and Dial allegedly colluded to entrap former Whitefish Police Det. Shane Erickson through a series of manipulations that included Dial, at Marshall’s behest, granting Erickson permission to accept an invitation on an exotic hunting trip gifted by Michael Goguen, a wealthy venture capitalist who lives in Whitefish. At the time, Erickson was investigating a debunked criminal allegation against Goguen, and accepting the gift amounted to an ethical violation, as well as a conflict of interest that resulted in Erickson leaving the department.

According to Erickson, he and the city entered into “a mutually agreed separation agreement” because Erickson refuted the allegations of ethical violations made by Dial against him to POST in November 2018, and in turn filed his own complaint against Dial with POST in July 2019. The evidence supporting the allegations against Dial and, subsequently, Kelch, emerged during those separate-but-related POST investigations, according to POST Council Bureau Chief Perry Johnson.

Meanwhile, in addition to Goguen’s philanthropic ties to the community, he remains embroiled in a civil lawsuit brought against him by Dial in December 2019, and is also the primary victim at the center an 11-count federal criminal indictment against Marshall, who is accused of defrauding Goguen for millions of dollars. Marshall has pleaded not guilty to all counts, including a new charge (as of Aug. 23) of aggravated identity theft.

The purpose of Dial’s and Marshall’s alleged entrapment scheme, according to the POST investigation, was to “exploit leverage” over Goguen. Marshall and Goguen had a previous relationship that soured after Marshall fraudulently convinced Goguen that he was an ex-CIA agent and member of an elite Force Reconnaissance unit in the U.S. Marine Corps “engaged in covert missions around the world.” None of those assertions are true, according to the federal criminal filing, though Goguen didn’t discover that until after he paid Marshall more than $2.3 million to fund “off the books” CIA missions. Those missions never happened, the indictment states, and Marshall instead spent the money for his own personal use, and on loans and gifts to friends and business associates — money that he did not report as income on tax returns from 2013 to 2015.

At some point, Marshall forged a friendship with Dial, the circumstances of which are integral to the POST complaint, which alleges numerous instances in which Dial made ethical lapses in judgment, as well as alleged violations of Montana’s administrative rules and procedures, and alleged violations of criminal law.

For example, the complaint states that, in April 2018, Dial provided Marshall with detailed information pertaining to an investigation of an alleged assault on members of Marshall’s family, including the identity of the suspects, their likely whereabouts, and an opportunity to personally confront the suspects upon arrest.

In one text message from Marshall to Dial, Marshall stated he would “like to have [the suspect] in an interview room for about 15 mins so I can explain to him the error of his ways and gently persuade him to pack his [expletive] and leave,” to which Dial responded that he was “sure that could be arranged.”

Dial then offered to provide Marshall with mugshots of the suspects so that Marshall and “the guys” could identify them and “make contact.” Later, Dial left Marshall a voice message confirming that one of the suspects was surrendering to the Whitefish Police Department. In a subsequent text message to Dial, Marshall acknowledged receiving the voice message, writing: “Me and all the boys were out last night hitting all the hot spots you told me about hoping to run into him. If he does turn himself in at your department I’d sure like to have a chat with him and encourage him to relocate out of Whitefish.”

Dial responded by texting: “That can be arranged, recording off of course.”

Both Dial and Kelch could face administrative consequences as a result of the POST proceedings, including decertification, while Dial’s alleged misconduct has been reviewed by the state Justice Department’s Criminal Justice Information Network (CJIN) and the state Division of Criminal Investigation (DCI), which both determined that the former police chief’s actions did not warrant criminal prosecution.

However, the POST complaint states that “Dial willfully violated orders or policies, procedural rules, and/or criminal law” by allowing an “unvetted civilian, having no POST certification or law enforcement credentials, physical access to Whitefish Police Department (WPD), access to information on confidential and ongoing police investigations and access to confidential criminal justice information (CCJI) when he provided Matt Marshall with: a key card permitting 24-hour access to WPD building facilities; a radio open to WPD police band transmissions; ongoing investigation reports and closed case reports containing CCJI generated by WPD and other law enforcement agencies.”

The POST complaint also alleges Dial lied to investigators with DCI and CJIN.

Given the immense complexity of the case, as well as the numerous individuals and agencies it involves, Johnson, the POST Council bureau chief, said the agency dedicated an enormous amount of resources to its investigation of Dial.

“We spent a lot of time on this case. We went through it very diligently and we really examined a lot of issues,” Johnson told members of the POST Council at its Aug. 24 meeting. “And while it appears that the issues are extensive, I would point out to you that these are not all of the issues that we examined. This case required hours upon hours of review.”

POST was formed in 2007 as an independent, quasi-judicial watchdog for the state’s public safety officers. The council, which is part of the Montana Department of Justice, is responsible for setting employment and training standards for all public safety officers.

Stay Connected with the Daily Roundup.

Sign up for our newsletter and get the best of the Beacon delivered every day to your inbox.