A federal grand jury today indicted Joseph A. Ferriero, the former chairman of the Bergen County Democratic Organization, on charges of soliciting bribes and extorting payments as part of a racketeering scheme that included various grants, building projects and software contracts, U.S. Attorney Paul J. Fishman announced this afternoon.
READ THE INDICTMENT HERE: Ferriero, Joseph INDICTMENT
The indictment also charges Ferriero, 56, with conspiring to promote bribery and distribute payoffs, as well as committing mail and wire fraud, among other offenses.
It had been expected for months, sources had told CLIFFVIEW PILOT, and comes three years after the former power broker left federal court in Newark a free man, thanks to a change in the “theft of honest services” fraud law by the U.S. Supreme Court.
The new indictment includes charges related to the activity that Ferriero was first accused of, while adding a pair of alleged schemes involving a real estate company in Virginia that allegedly paid $1.7 million in an effort to develop land owned by the N.J. Sports & Exposition Authority (NJSEA) in Bergen County. It also accuses Ferriero of accepting bribes through a Nutley-based attorney in exchange a favorable opinion of a software developer and his companies to various public officials in Bergen County.
Fishman accused Ferriero of running the Bergen Democratic organization as a racketeering enterprise, “abusing power for profit.”
Aaron T. Ford, who heads the Newark FBI Field Office called the indictment “another unfortunate example of someone misusing their position in our political system for personal gain. Such conduct tarnishes our political system.”
According to the indictment, Ferriero — who served as BCDO chairman from 1998 until January 2009 – “conducted the BCDO’s affairs through a pattern of racketeering activity involving three schemes: the Governmental Grants Consulting (GGC) kickback scheme, the retail and entertainment project bribery and extortion scheme and the SJC Consulting (SJC) bribery scheme.”
Ferriero offered then-incoming borough Bergenfield borough attorney Dennis J. Oury, 63, a “concealed ownership interest in GGC in exchange for Oury’s agreement to exercise official action and discretion in GGC’s favor in Bergenfield,” the indictment says
Oury, who was Ferriero’s political aide and ally, “accepted the offer and used his official position to cause GGC to be hired in Bergenfield,” it says.
A portion of GGC’s proceeds from the borough were ultimately kicked back to Oury by Ferriero, the indictment alleges.
A previous indictment for the same scheme led to a guilty plea by Oury in September 2009, for which he was sentenced last November to three years of probation.
A federal jury in Newark later convicted Ferriero of one count of conspiracy and two counts of mail fraud related to the same scheme.
However, the U.S. Supreme Court limited the scope of the “honest services” fraud law before Ferriero could be sent, forcing U.S. District Judge Stanley R. Chesler to dismiss the convictions on conspiracy and two mail fraud counts.
Ferriero’s lawyers released a statement today accusing the government on conducting a “tragic and unprincipled attack” against him “without any legal or factual basis.”
“The U.S. Attorney’s Office has refused to listen to reason after his lawyers have, for months, sought to show them that neither the law nor the facts support their allegations,” wrote the attorneys, Michael Baldassare and Jennifer Mara.
“The bottom line is that the last time the government charged Mr. Ferriero, the jury acquitted him of five counts and the court dismissed the remaining counts of the indictment because they were legally invalid,” they said.
“The extent of their crusade against Mr. Ferriero is revealed by their taking the extraordinary step of charging him alone with racketeering in an effort to revive old allegations that could not otherwise be charged based on the statute of limitations, which would bar almost all of what is charged in this indictment.
“We are confident that, once again, Mr. Ferriero will be vindicated after a full and fair trial, taking into account both the law and the facts,” the lawyers added.
According to the new indictment, a Virginia-based real estate investment trust (REIT) agreed in 2002 “to secretly pay a consulting company operated by Ferriero and two of his then-law partners $35,000 a month in exchange for Ferriero’s agreement not to publicly oppose – nor to cause members of the BCDO or other public officials with whom he had influence to publicly oppose – the Virginia REIT’s proposal to the NJSEA.
“The payments were also in exchange for Ferriero’s assistance in obtaining endorsements, public support and other official action and inaction in favor of the Virginia REIT from members of the BCDO and other public officials with whom he had influence,” it says.
The company, believed to be the Mills Corp., was looking to build an entertainment and retail complex in the Meadowlands known as Xanadu.
The project eventually was taken over by a group known as Triple and is now being resurrected as American Dream and being built by Triple Five.
The indictment also says that the software developer in the other alleged scheme agreed to pay Ferriero one-quarter to one- third of the gross receipts from any contract obtained as a result of Ferriero’s efforts.
“Ferriero’s financial interest in the software developer’s public contracts was completely hidden using two shell companies, one of which was created and incorporated in Nevada for the sole purpose of contracting with and accepting payments from another shell company controlled by the software developer,” it adds.
Ferriero and Oury schemed to profit from their hidden ownership in a grants-writing business hired by Bergenfield in January 2002 — the same night that Oury was appointed borough attorney, the original indictment said.
Oury cut a deal with federal prosecutors, pleading guilty to conspiracy and failing to file a tax return, and agreed to testify against his pal in exchange for consideration at sentencing.
Oury later testified during a three-week trial that Ferriero hatched the scheme to contract grant consulting services from to local municipalities without telling anyone about their controlling interests. They took on a third parnter, former Republican North Arlington Mayor Leonard Kaiser.
Theirs wasn’t the only deception, Oury said: He said he hid legal work he did for Bergenfield from Ferriero before their firm was hired.
The Borough Council approved a contract with the firm based on little more than Oury’s recommendation.
Kaiser, a former county freeholder and New Jersey Meadowlands commissioner, was never charged in connection with Ferriero or Oury.
He and his wife later pleaded guilty to attempted tax evasion involving compaign funds and were given probastion.
Fishman credited special agents of the FBI with making the case, led by investigators from the U.S. Attorney’s Office under the direction of Counsel to the U.S. Attorney Rachael A. Honig.
No initial appearance date in U.S. District Court in Newark had been scheduled for Ferriero as of this afternoon.
PHOTO: Courtesy Nj.com
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