Former Chicago Streets and Sanitation Commissioner Al Sanchez is on trial for promoting politically motivated hiring practices to fill the Streets Department’s payrolls. Witnesses in the ongoing hiring fraud trial testified that the city’s electric bureau did not even consider applicants without political connections. The electric bureau’s personnel liaison, Hugh Donlan, was very clear about where interviewers should file ratings forms for non-political applicants. “I’d put it in the garbage,” he said. Prosecutors are charging Sanchez with mail fraud and funneling jobs to workers in the city’s Hispanic Democratic Organization. (Chicago Tribune)
Former Pennsylvania senator Vincent Fumo was convicted Monday on 137 counts of fraud and obstruction of justice. Prosecutors said that Fumo inappropriately used more than $2 million in senate resources and $1.5 million from civic organizations. Prosecutors will seek a jail sentence of more than ten years. As part of the lengthy corruption trial, Fumo testified for six complete days, sometimes comparing his crimes to misdemeanors such as spitting on the sidewalk. (Associated Press)
The Justice Department announced Monday that it would withhold a set of 100 unclassified documents containing government allegations and evidence against detainees held at a military prison in Cuba. Although the documents themselves are unclassified, prosecutors say that classified information which could be of value to enemies abroad slipped in. Attorneys of the detainees criticized this decision for significantly complicating their work as hearings approach. And three news organizations say that this is an inappropriate strategic move to keep information from the public. A federal judge will review the matter on March 26. (Washington Post)
A report prepared for the Mortgage Bankers Association showed that mortgage fraud increased by 26 percent in 2008. One of the report’s authors said that “the economic downturn may have created more desperation, causing more people than ever before to try to commit mortgage fraud.” Rhode Island and Florida led the nation with the most mortgage frauds. (Washington Post)
Ruth and Bernard Madoff were granted up to $50,000 in tax breaks on their home in Palm Beach after Bernard Madoff was charged with orchestrating a massive Ponzi scheme in December. The Madoffs had applied for this tax break for their $9 million home before, but were denied because their primary residence was a multi-million dollar penthouse in New York City. The Florida Property Appraiser’s office confirmed that Mrs. Madoff applied again in September and was granted the tax break on January 12, after claiming the Palm Beach residence as her primary home. The Palm Beach Post quotes a number of local attorneys who think this is an attempt by Mrs. Madoff to benefit from Florida’s bankruptcy laws, which favor debtors. (Palm Beach Post)
Sir Allen Stanford owes $226.6 million in taxes, according to a report released by the I.R.S. In the past two years, the I.R.S. filed four tax liens against Stanford, who has been accused of executing an $8 billion Ponzi scheme. Stanford and his wife Susan denied that they owed this amount and took the IRS to court last August. A federal judge ruled Monday that the government could actively go after those back taxes accrued between 1999-2003. (New York Times)
