In May 2012, the Joint Commission on Public Ethics sent Libous a letter informing him of an investigation against him. He stated, "I will fully cooperate with any review that JCOPE wants to do and I would hope they would do it in an expeditious manner." The investigation stemmed from a complaint filed by Binghampton Mayor Matt Ryan asking JCOPE to look into comments made by Anthony Mangone in a federal trial. Mangone, a former attorney, said Libous asked him to give Libous' son a job with his law firm and in return Libous would help the firm get business. Libous denied such charges, saying, "There was no quid pro quo arrangement with the law firm. I made no promises and nothing transpired between me or my office and the firm." Libous said the move by Ryan, a Democrat, was politically motivated as there had been speculation that Ryan was considering a run for Libous' seat. In response Ryan said, "Senator Libous has been doing a lot of polling lately about different issues. I think that one question he should ask his constituents is, "Do you believe my story? Do you believe that I knew nothing about it?" And I guarantee you, a very high percentage of people would say no, we don't believe you." On July 1, 2014, Libous was indicted by U.S. Attorney Preet Bharara on one count of lying to an FBI agent. The indictment alleged that Libous hid "material facts" from investigators looking into the hiring of his son by a law firm. Libous pleaded not guilty in court and was released hours later on $50,000 bail. Libous' son, Matthew, faced six charges over allegations that he hindered FBI investigations and did not report more than $28,000 in income and personal expenses paid on his behalf. Such expenses included internet dating subscriptions and trips to casinos. Matthew was convicted on three felony counts of subscribing to false tax returns, though was acquitted of the charge of obstructing the IRS. On May 18, 2015, Libous' son was sentenced to six months in jail, ordered to pay a $25,000 fine and sentenced to 100 hours of community service. On July 22, 2015, Libous was found guilty of lying to the FBI and was removed from office. On November 24, 2015, Libous was sentenced to two years of probation, six months of house arrest and a $50,000 fine. He avoided jail time because he was diagnosed with terminal prostate cancer. He could have faced up to five years in prison.