Thursday, February 6, 2014

Nagin Faces Corruption Charges, Takes Stand

byManiko Barthelemy
 
In a few days a jury decides if ex-New Orleans Mayor Clarence Ray Nagin convinced them he’s innocent. Today, Nagin took the stand in a federal court room in New Orleans. The 57-year-old faces a 21-count indictment of fraud, tax evasion and corruption. Under direct examination by his attorney, Robert Jenkins, Nagin was cool, calm and collected. Jenkins moved quickly from Nagin’s career as a Cox Cable executive to becoming mayor and the core of the government’s case. “I’ve heard a lot in this case that don’t make sense,” said Nagin.

The government alleges, during Nagin’s second term as mayor, 2006-2010, he became too close to select city contractors, ultimately blurred clear cut lines between city business, personal business, finances and favors. The toxic mix of what some witnesses called a pay-to-play political climate in New Orleans post-Hurricane Katrina paved the road for millions of dollars in city contracts to go to a handful of pre-selected companies, specifically Three Fold Consultants, LLC and Home Solutions of America (HSOA). The companies were linked to deposits and deals with Stone Age, LLC a granite company in New Orleans owned and operated by the ex-Mayor and his sons, Jeremy and Jarin Nagin. Nagin said he only bank rolled the business to help his sons get started. “I was mainly the financier and I told them I would keep my investment down to about $10,000 a year,” said Nagin.
Rodney Williams seen leaving the federal courthouse in New Orleans
Rodney Williams, Tarek Elnaggar and Bassam Mekari owned Three Fold Consultants, LLC. Earlier in the trial, Williams, who was the government’s first witness, said at a meeting in January 2008, Nagin told him he was “tapped out,” referencing the financial struggles of Stone Age, LLC, a granite company Nagin owned with his sons, Jeremy and Jarin. “He said it sure would be nice if he had $60, 000,” said Williams. Within hours, Williams gave Stone Age three $20,000 checks, each written by Williams, Elnaggar and Mekari. Shortly after the checks cleared, Three Fold Consultants became a city contractor. Nagin said the $60, 000 was an investment in Stone Age, LLC, not a bribe. Documents presented in court showed the sale of shares of Stone Age, LLC stock in Jan. 2008 to a company called BRT Investment. The company, however, was not registered in Louisiana until March. “We did that as a cover-up,” said Williams.
The government showed evidence, over a two year period, Three Fold, LLC went from earning a little more than $120,000 to $2.6 million. A healthy portion of their business was tied to city contracts. “I had no authority on selecting them,” said Nagin. Brenda Hatfield, a former city administrator, testified Nagin signed an executive order that stripped a screening board of its authority to recommend or reject city contractors and the decision became the mayor’s exclusively. Williams plead guilty to bribery in 2010 and is awaiting sentencing.
Internet Photo of Frank Fradella
Frank Fradella owned Home Solutions of America. His company, once headquartered in Texas, relocated to New Orleans after Hurricane Katrina. From 2007 through 2010 Fradella worked in overdrive to secure millions of dollars in business for HSOA. A potential for a NASCAR track to come to New Orleans caught his attention. The project would have been profitable at least five years after the track was completed, it failed. He pursued a multi-million dollar deal to turn an old Entergy building into a mixed-use facility of condos and strip malls. It failed. Fradella, with the help of mayor Nagin vouching for HSOA at a meeting with investors, was able to get a $40 million credit line for his company. “We took them on a tour of the city and they were very impressed with all of the work that could go on and the mayor told them we were good for it,” said Fradella. Fradella maintains as a show of gratitude, he’d often treat Nagin to trips or in at least one time, gave Stone Age a $50,000 check. “It was a bribe,” said Fradella.
Nagin said Fradella and Williams lied about the money they gave Stone Age. He minimized his contact with Fradella as an alternative form of possible financing development in the city when government red tape was slowing progress. Fradella sent Nagin an e-mail claiming he could raise $250 million - $500 million. “I talked to him a lot because we had a huge problem trying to get federal dollars to the city after Hurricane Katrina and he was a business man who wanted to help get private dollars to the city,” said Nagin.
When Federal Prosecutor, Matthew Cowman cross-examined Nagin, the defendant’s tone transitioned to defiant, evasive and guarded. Nagin danced around answers to the Coman’s questions related to everything from confirming his signature on legal documents to personally knowing Williams, Fradella or Mark St. Pierre, the source of many lavish vacations and other gifts Nagin received. Collectively the gifts netted to six-figure omissions from his 2007-2010 tax records.
Cowman continues cross-examining Nagin, Friday. Judge Ginger Berrigan said the trail should be over by early next week. Depending on the verdict, Nagin taking the stand may turn out to be the best or the worst decision of his life. He could spend up to 20 years in prison, if found guilty.
What do you think about Nagin taking the stand?

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