73 CHARGES FOCUS ON PUBLIC-PRIVATE CONFLICTS

Photo

Oakhill Indictment

Download as PDF

Document

2.3 MB file

Photo

Anthony Cafaro Sr.

Photo

Flora Cafaro

Photo

Martin E. Yavorcik

Photo

Mahoning County Commissioner John McNally

Photo

Mahoning County Auditor Michael Sciortino

Photo

John Zachariah

By PETER H. MILLIKEN

milliken@vindy.com

YOUNGSTOWN

The interaction of public officials with private interests over Mahoning County’s purchase of Oakhill Renaissance Place led to indictment of seven people and three business entities, including The Cafaro Co.

Charges against various defendants include engaging in a pattern of corrupt activity, conspiracy, perjury, bribery, money laundering, tampering with records, disclosure of confidential information, conflict of interest, filing a false financial disclosure statement, and soliciting or accepting improper compensation.

Many of those charged or their representatives, however, say they’re innocent and were watching the taxpayers’ dollars in a bad building deal.

No court dates for arraignments had been set as of late Thursday.

“As special prosecutors, we were concerned that public officials would be so involved with the private interests of the owners of the Garland Plaza,” said Paul M. Nick, one of the two prosecutors, after releae of the 73-count indictment by a county grand jury.

If convicted, the Cafaro Co. would lose Garland Plaza.

But The Cafaro Co. and its affiliates, and two of those indicted — Anthony M. Cafaro Sr., and Flora Cafaro — said in prepared statements that they plan to plead innocent to the charges, which the company and its former president called “meritless.”

“I look forward to proving my innocence. The taxpayers of Mahoning County are now paying for the ill-advised decision to purchase Oakhill Renaissance Place. My warnings about the costs to the taxpayers have been correct. This unfounded indictment will not silence my opposition to irresponsible governance,” said Cafaro Sr.

FACING CHARGES

Charged are:

Cafaro Sr. of Hubbard, the recently retired president of the Cafaro Co.

Flora Cafaro, part-owner of the Cafaro Co.

The Cafaro Co. itself.

Two of its affiliates, the Ohio Valley Mall Co. and The Marion Plaza Inc., all of Youngstown.

County Commissioner John A. McNally IV of Youngstown.

Former county treasurer John B. Reardon of Boardman

County Auditor Michael V. Sciortino of Austintown.

Former county Job and Family Services Director John Zachariah of Chagrin Falls.

Atty. Martin Yavorcik of Boardman.

“Public officials here should speak their mind, and when they feel a project is ill-advised, they should stand up. That’s what we elect public officials for, and that’s what these public officials did in this case,” said Lou DeFabio, the lawyer for Reardon.

The indictment charges that Cafaro Sr. and his business entities conspired with McNally, Reardon, Sciortino, and Zachariah to prevent or delay the relocation of the county’s JFS offices.

The charge of engaging in a pattern of corrupt activity contains the forfeiture specification against the Cafaro Co.-owned Garland Plaza, where JFS was housed in rented quarters from 1988 until its move to Oakhill in 2007. The indictment alleges that participants in the conspiracy provided or accepted money, free legal services, campaign contributions and the offer to guarantee a loan made by a national bank.

The bribery charges allege that the Cafaro Co. or its subsidiaries bribed McNally, Reardon, Sciortino, and Zachariah.

Zachariah is charged with tampering with records.

McNally is charged with disclosure of confidential information. That charge alleges McNally shared his notes from the commissioners’ executive session discussions of the Oakhill purchase with Cafaro Sr. or his lawyers.

McNally, Reardon and Sciortino are charged with conflict of interest.

Reardon and Sciortino are charged with filing false financial disclosure statements.

McNally and Sciortino are charged with soliciting or accepting improper compensation.

“We were expecting this, considering at least that this grand jury had been meeting for months on end,” said DeFabio. “These are the same allegations that were made in 2006 and 2007 when this whole Oakhill fiasco was going on,” he said, adding that he plans to enter innocent pleas on behalf of his client to all charges.

‘A BAD PROJECT’

Reardon, Sciortino and McNally “have always insisted they did absolutely nothing improper, that they thought Oakhill was a bad project then, and that it is a bad project now looking back through time at how much money it’s cost,” DeFabio said.

Yavorcik and Flora Cafaro are each charged with only a single count of money laundering. The charge against Yavorcik pertains to his unsuccessful 2008 independent election campaign against Democratic County Prosecutor Paul J. Gains.

Yavorcik received $120,000 from members of the Cafaro family for that campaign: $40,000 each from Cafaro Sr. and Flora Cafaro; and $40,000 from John J. Cafaro, the recently retired executive vice president of the Cafaro Co.

DeFabio said he believes the special prosecutors will agree to recognizance bonds for all defendants.

“These defendants are not flight risks,” he said.

UNANIMOUS VOTE TO INDICT

The nine grand jurors voted unanimously Wednesday in favor of all 73 counts, according to the report filed by Michael T. Heher, grand jury foreman. The indictment was filed with the county clerk of courts on Thursday.

The county bought

Oakhill, which is the former Forum Health Southside Medical Center, in 2006 for use as a county office complex.

McNally, Sciortino and Reardon publicly opposed the purchase of Oakhill based on what they said were uncertain costs of buying, operating and maintaining the former hospital complex.

The 353,000-square-foot Oakhill complex was built in stages between 1910 and 1972.

On the day the county bought Oakhill in U.S. Bankruptcy Court, McNally, Sciortino and Reardon met with Cafaro Sr., then president of the Cafaro Co., in Cafaro’s office.

The Cafaro Co., which was then the landlord for the Department of Job and Family Services at Garland Plaza on the city’s East Side, sued unsuccessfully to rescind the county’s purchase of Oak-

hill, to which JFS moved in July 2007.

Sciortino refused to issue the $75,000 check for Oakhill until Visiting Judge Richard M. Markus ordered him to do so at the end of the July 2007 nonjury trial of that lawsuit.

County Treasurer Lisa A. Antonini, who was chief deputy treasurer before Reardon left in February 2007, acknowledged in that trial that her cellular phone records showed 28 calls made or received between her and Cafaro headquarters between Aug. 12, 2006, and March 17, 2007.

However, she testified in that trial that she never spoke to Cafaro Sr. about Oakhill. Antonini is not named in the indictment.

At the time those calls were made, Antonini was Mahoning County Democratic Party chairwoman in addition to her county employment.

Antonini was subpoenaed along with McNally and Sciortino in 2008 and directed to turn over Oakhill-related documents and correspondence to the grand jury, did not return calls seeking comment.

CAFARO DONATED TO CAMPAIGN

In his testimony, Reardon acknowledged that Cafaro had been a major contributor to his election campaigns.

At Gains’ request, the county’s common pleas judges appointed Dennis P. Will and Nick in November 2008 as special prosecutors for a probe of possible criminal violations of Ohio’s ethics law related to conflict of interest.

Will is the Lorain County prosecutor, and Nick is chief investigative counsel for the Ohio Ethics Commission.

The ethics commission began investigating Oakhill in December 2007. Will and Nick met with the grand jury more than a dozen times between February 2010 and this week. Nick said he anticipates no further charges from this grand jury and that he expects the Oakhill cases will be referred to a visiting judge.

Among those entering the grand jury room, where all proceedings were secret, were Anthony T. Traficanti, chairman of the county commissioners; county Administrator George J. Tablack; Linette Stratford, chief of the civil division of the county prosecutor’s office; and Gains.

REARDON QUIT JOB

Reardon resigned his $100,984 job in Columbus as state superintendent of financial institutions in May, saying through a spokeswoman that he left to be closer to Youngstown and to his family.

McNally and Sciortino said they would not resign their county jobs if they were indicted.

Reardon, Sciortino and McNally called a joint news conference at the Covelli Centre in late May, during which they denied any wrongdoing in connection with Oakhill. They also said their objections to the Oakhill purchase were substantiated, and they said the county can ill afford Oakhill at a time of financial crisis.

At the end of 2009, Cafaro Sr., 63, Cafaro Co. president, and his brother, John J. Cafaro, 58, executive vice president, retired; and Anthony Sr.’s sons, Anthony Jr., 34, and William A., 40, took over as co-presidents of the company.

Anthony Sr. said then that the retirements were part of a transition that began several years ago at the company, which is the nation’s largest privately-owned shopping center development and management company.

JOHN CAFARO CONVICTIONS

In June, a federal judge sentenced John J. Cafaro to three years’ probation and 150 hours of community service and fined him $250,000 after he pleaded guilty to making a false statement about a campaign contribution.

He made the contribution to help the unsuccessful 2004 congressional campaign of his daughter, state Sen. Capri Cafaro, of Liberty, D-32nd, who is now the Ohio Senate minority leader, the U.S. Attorney said.

John Cafaro caused his daughter’s campaign to falsely report to the Federal Election Commission that he had given only $2,000 to her campaign, when, in fact, he gave an additional $10,000 in the form of a loan to her campaign manager for the campaign’s benefit, the U.S. Attorney said. The legal limit for gifts to congressional campaigns by individuals is $2,000.

In 2002, a federal judge sentenced John Cafaro to 15 months’ probation and fined him $150,000 for bribing former U.S. Rep. James Traficant.

REPUBLICAN RESPONSE

“The Mahoning Valley has once again been tarnished and embarrassed by the actions of Democrats who continue to claim they are the best choice to govern our Valley,” said Mahoning County Republican Party Chairman Mark Monroe.

Corruption is a drag that hampers economic recovery, he said, adding, “What business wants to locate in an area where bribery, money laundering, and other corrupt practices can be found?”

“Over the past 2 decades, we have seen too many elected Democrats who have betrayed the public trust,” Monroe continued. “That list includes a congressman, judges, a sheriff, prosecutor, and a county commissioner, Democrats all.”