Updated at 7:17 p.m.

A private consultant was indicted this week – the second time in 10 months – in connection with a widening corruption scandal that already has ensnared a onetime Oregon Department of Energy manager.

The 78-count indictment against Martin Shain includes allegations of bribery, racketeering, theft and tax evasion, and comes two days after the former agency manager, Joe Colello, pleaded guilty to accepting $291,017 in kickbacks.

Shain, 60, was both a consultant on energy projects and a tax credit broker. Prosecutors say the Seattle-based businessman sent cashier's checks to Colello on more than 50 occasions over a 2½-year period. In turn, Colello said he helped Shain arrange the sale of tax credits the agency issued to developers and owners of renewable energy and conservation projects.

The indictment was handed down by a Marion County grand jury on Wednesday but not made public until Thursday. It listed 29 witnesses, including state officials, tax credit recipients, project developers, accountants and others.

Shain is scheduled to be arraigned Friday morning in Marion County Circuit Court. His lawyer, Jim McDermott, said that, "Mr. Shain denies being part of any racketeering enterprise. Mr. Shain also denies bribing any government officials."

Shain was indicted last August on charges of forging documents to improperly obtain nearly $12 million in energy tax credits to support the construction of solar arrays at Oregon State University and the Oregon Institute of Technology.

State and federal law enforcement agencies launched investigations of the solar project after The Oregonian/OregonLive published a Feb. 27, 2015, report raising questions about the authenticity of the documents and Shain's involvement in gaining the tax credits.

Shain was a consultant on that project, hired by the state to help solicit proposals, select vendors, negotiate contracts, monitor construction and help secure the tax credits. He was paid some $2.4 million in fees, most of it by the project developer, SolarCity.

But Shain also became a player in the lucrative business of brokering tax credits, joining other firms and individuals in the gold rush that developed after the state supersized the long-running energy incentive program and issued hundreds of millions of dollars in tax credits. The business entailed helping tax credit recipients, including municipalities, state agencies, transit agencies and private companies, sell them for cash to deep-pocketed individuals and corporations looking to reduce their tax liabilities.

The state allowed the sales to help project backers raise upfront cash, and almost three-quarters of the nearly $1 billion in tax credits issued by the Energy Department were sold. For years, those sales were handled strictly by the agency, with Colello in charge of matching up buyers and sellers and verifying that the transactions took place at the state-mandated price.

That worked smoothly until 2010, when the market for tax credits plummeted during the Great Recession. The market also softened as the original sunset date of the program approached in 2012, and tax credits flooded the market. Many recipients found themselves sitting on credits that they had little expertise in marketing, or potentially worse, were set to expire.

In the end, third-party brokers virtually took over Colello's matchmaking role, with the agency's blessing. The brokers earned lucrative commissions in the process, sometimes 10 percent or more of the value of the tax credits they placed. Tax accountants and other service providers also got a piece of the action, charging clients a placement fee for hooking them up with the broker.

Shain was deeply familiar with the tax credit program and its byzantine rules. And he had developed a personal relationship with the most important contact in the agency – Colello -- who had access to both the list of credits coming on the market and the investors who had expressed an interest in purchasing them.

Colello told The Oregonian/OregonLive that his relationship with Shain evolved from professional to a personal friendship. The two regularly discussed business, and Shain talked of using him as a partner or consultant on deals, Colello said.

"We have a verbal agreement," Colello said. "At some point the money just started showing up."

Colello received cashier's checks on 52 separate occasions, usually in FedEx packages, he told The Oregonian/OregonLive. The payments ranged from $1,000 to $14,130, court documents show. Colello said he deposited them in a brokerage account and was playing the futures market with the proceeds, hoping to establish his own business over time.

Shain marketed himself throughout the state, and placed tax credits for the cities of Wilsonville and Canby; transit districts in Lane County, Salem, La Grande, and South Clackamas County; Mt. Hood Community College; the University of Portland, as well as for at least one private company.

One of the earliest transactions listed in court filings is the sale of tax credits for the city of Canby. Shain earned more than $50,000 in commissions on three tax credits that he sold for Canby Area Transit in the summer of 2012, according to emails and documents obtained by The Oregonian/OregonLive through a public records request.

In emails with Canby Transit Director Julie Wehling, Shain portrays himself as slogging hard to earn his money, flying to Southern California and Chicago to make sophisticated presentations to multiple investors, at least one of them a retailer with an Oregon presence and an appetite for tax relief.

It's not clear whether those trips really took place. All of Canby Transit's credits placed by Shain were sold to individuals in Oregon, some of them clients of an accounting firm with an office on Kruse Way in Lake Oswego.

Canby seemed pleased with the service.

"You will never know how much your work helping [Canby Area Transit] get pass-through partners has meant to CAT and me personally," Wehling wrote to Shain in September 2010, shortly after he'd sold the first two credits.

"I can't fully explain how wonderful that makes me feel," Shain responded. "To be able to help make a difference for a great community, which like most, is struggling to maintain services ... That's perfect. I'm not a young guy any more, and I tend to take projects I'm emotionally vested in. Canby is certainly one of those."

Wehling served as a reference for Shain with other clients.

Colello's managers at the Department of Energy apparently never picked up on his alleged side job with Shain. And audits by the Secretary of State and an outside forensic auditing firm hired specifically to identify fraud in the program didn't flag Colello or Shain, though it did say the program lacked adequate controls to pick up instances of fraud.

Shain's 2,700-square-foot waterfront home in Seattle is on the market for $1.6 million. He also appears to own another home in the city.

Shain's brokerage business, RC Shain & Associates, is registered to 85-year-old Roselle Shain of Seattle. Her signature is on contract documents with the City of Canby.

Her relationship to Martin Shain was not immediately clear, but his brother has already become entangled in the forgery case. Earlier this year, Phil Shain submitted an affidavit to the court claiming he forged the documents to save his brother's business, which was in danger if the solar project fell through.

A man who answered the phone listed in Roselle Shain's name said, "At the present time, Mrs. Shain has no comment to The Oregonian."

--Ted Sickinger

503-221-8505; @tedsickinger