Wednesday, May 11, 2016
Opening statements are scheduled for Monday in yet another Philadelphia political corruption trial.
Call this politics, payoffs and a Porsche and put lame duck Congressman Chaka Fattah Sr. at center stage. Fattah, who was defeated in the Democratic Party primary earlier this month, is in the final year of a congressional career that began in 1995.
The trial that opens Monday before U.S. District Court Judge Harvey Bartle 3d will determine whether he begins his retirement wearing a prison jump suit.
"I'm not sure how he's going to explain some of this," said a source familiar with the case. "It's going to take some gyrations."
The 29-count indictment handed up in July charged Fattah and four co-defendants with conspiracy, bribery and fraud. The government alleges that the congressman played fast and loose with federal grants and other earmarked funds, using them to pay off personal and campaign debts, including $600,000 that was spent on his failed Philadelphia mayoral campaign in 2007.
The trial is one of four political corruption cases generating headlines.
On Tuesday John H. Estey, one-time aide to Gov. Edward Rendell, pleaded guilty in an illegal campaign funding scheme that was part of an FBI sting targeting Harrisburg legislators. In a separate case, the former mayors of Reading and Allentown have emerged as targets in a federal pay-to-play investigation. And then there is South Philadelphia State Senator Larry Farnese, indicted this week in what authorities allege was a $6,000 bribery scheme to insure his election as a Democratic Party ward leader back in 2011.
Farnese, through his lawyers, has denied the allegation which, when compared to the other political corruption cases, appears penny-ante at best. Details are still emerging, but at first blush the case may be an example of what some defense attorneys charge is federal prosecutors going above and beyond in a crusade-like campaign to ferret out corruption. (More on that later.)
The Fattah case, on the other hand, is chock full of seemingly documented examples of money earmarked for legitimate public services being funneled to benefit the congressman and/or his financial needs.
Fattah will go on trial along with Herbert Vederman, a lobbyist who was the financial director for Fattah's mayoral campaign, Robert Brand, the husband of a former Fattah staff worker, Karen Nicholas, a former staffer and the CEO of a Fattah-funded non-profit that is central to one of the corruption charges, and Bonnie Bowser, one-time chief of staff of the congressman's Philadelphia office as well as treasurer for his mayoral and congressional campaigns.
The indictment alleges the five were part of "an enterprise" that used "fraudulent and corrupt means" to further the financial interests of Fattah and that conspired to hide those activities from Justice Department investigators and the media "through means that included the falsification of documents and obstruction of justice."
Two other alleged conspirators, high-powered Washington, D.C.,-based political consultant Thomas Lindenfeld, and longtime Fattah aide Gregory Naylor have pleaded guilty to related charges and are scheduled to appear as government witnesses at the trial.
Their testimony is expected to provide one of the linchpins around which the case is built.
The government says that the case involved five different schemes. These included:
- The allegation that Fattah and other defendants used charitable and federal grant funds earmarked for Fattah's non-profit Educational Advancement Alliance (EEA) to repay a $600,000 debt from Fattah's mayoral campaign. The $600,000 included $200,000 distributed as "street money" on election day, the government contends.
-- A charge that Fattah and his associates had Lindenfeld set up a phony non-profit known as Blue Guardian and then arranged to have federal funds earmarked for that non-profit. The payments were, in fact, made to pay down political consulting fees Fattah owed Lindenfeld, according to the feds.
- An allegation that campaign funds were illegally used to pay off the college tuition debts of Chaka Fattah Jr. The congressman's son was convicted last year in an unrelated case charging him with IRS and bank fraud.
- A bribery scheme in which Vederman is accused of providing "things of value" to Fattah in exchange for Fattah's promise to try to secure an ambassadorship for Vederman or an appointment to United States Trade Commission. The scheme also allegedly involved a job for Vederman's girlfriend. Among other things, the government charges that the phony sale of a 1989 Porsche 911 by Fattah's wife, TV news anchor Renee Chenault-Fattah, to Vederman was part of the conspiracy.
- A scam in which the National Oceanic and Atmospheric Administration was duped into providing $50,000 to underwrite an EEA conference that never took place.
The trial is expected to last from six to eight weeks, although several observers predicted that it could end sooner because of Judge Bartle, a no-nonsense jurist with a reputation for fast-paced trials. Bartle is expected to address the jury at 9:30 Monday morning. The panel was selected earlier this month. Opening statements from the prosecution and defense will follow.
While much of the testimony and documented evidence will be focused on somewhat arcane matters like federal grants and campaign finance laws, the testimony of Lindenfeld, a self-made millionaire political consultant whose clients have included then U.S. Senate candidate Barrack Obama and Philadelphia mayoral candidate John Street, could provide an interesting account of what really goes on in a political campaign.
And the Vederman charges could provide more of the same.
The government alleges that the lobbyist was angling for an ambassadorship or a spot on the trade commission and funneled money to Fattah through his son. It also charges that the $18,000 he paid for the Porsche was designed so that Fattah and his wife would qualify for a mortgage on a vacation home in the Poconos.
The "car purchase" in 2012 was "a means to deceive the mortgage lender and evade...rules prohibiting gifts from lobbyists and requiring disclosure on Fattah's financial disclosure form." Instead, the government contends, "Fattah, Bowser, Vederman and Fattah's spouse falsely styled Vederman's $18,000 payment as having been made as part of a car sale."
The government alleges that "Vederman never took possession of the vehicle" and that "the Fattahs continued to possess, drive and insure the Porsche well after the purported `sale' to Vederman" The indictment noted that the car was still parked on the Fattah's property 26 months after the sale took place.
In July after the indictment was unsealed, Chenault-Fattah wrote a letter to her employer, news station NBC10, in which she said the sale of the Porsche was not, as the government charged, a sham. Instead, she said she continued to house and insure the car because Vederman did not have a place to keep it. Chenault-Fattah took a leave leave from the station when the indictment was made public. She is no longer employed by NBC10.
The misdirection of funds, albeit on a much smaller scale, appears to be at the heart of the case against Larry Farnese as well.
The indictment announced on Tuesday alleges that in 2011 he made a $6,000 donation to Bard College to help fund a study abroad semester for the daughter of a Democrat committeewoman whose vote he needed to insure his election as ward leader
The quid pro quo, however, is questionable. In a statement released by Mark Sheppard, Farnese's lawyer, that appeared in Wednesday's Inquirer, Sheppard noted that "The government makes these charges despite the fact that the donation was properly reported almost five years ago, was given some five months before a unanimous ward vote in which the committeewoman did not even participate; and no other committeeperson has claimed to have been offered anything of value by Sen. Farnese."
So, taking Sheppard at his word, the government has indicted Farnese for making a college donation to a school attended by the daughter of a committeewoman who did not cast a ballot in a ward election in which Farnese was unanimously elected.
Seems like a bit of a stretch on the government's part. But maybe the feds have a distorted view when it comes to the State Senate's First District. This is the same district once represented by Vincent J. Fumo and before Fumo by Henry J. "Buddy" Cianfrani. Both were convicted of serious corruption charges.
Now Farnese holds that seat. Maybe an indictment comes with the territory.
George Anastasia can be contacted at George@bigtrial.net.