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Mayor Ray Nagin took $50,000 payoff, granite, consulting

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scion Member Level  Wednesday, 06/27/12 12:41:27 PM
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Mayor Ray Nagin took $50,000 payoff, granite, consulting gig, businessman says

Published: Wednesday, June 27, 2012, 10:46 AM Updated: Wednesday, June 27, 2012, 11:34 AM
By Times-Picayune Staff

While in office, Mayor Ray Nagin accepted a $50,000 payoff and shipments of free granite from city vendor Frank Fradella, and after leaving City Hall, he became a highly paid consultant to Fradella, according to court documents filed this morning. Fradella was in federal court to plead guilty to one count of securities fraud and one count of conspiring to bribe Nagin, described in court documents as "Public Official A."

The government's description of that public official, as well as other clues, make clear that it is Nagin.

Nagin has not been charged. He has not responded to an email seeking comment. Robert Jenkins, who WDSU-TV has reported is his lawyer, has not returned calls from The Times-Picayune.

Paul Murphy of WWL-TV reported this morning that Jenkins had no comment on Fradella's allegations.

Fradella was charged in bill of information Monday that only vaguely sketched out the alleged kickback scheme. But the summary of the government's case against Fradella filed today added vivid new details -- and made it crystal-clear that Nagin is the target federal prosecutors are seeking.

It says that Fradella, who ran a disaster-recovery firm, transferred $50,000 to Nagin on June 23, 2008, during Nagin's second term in office. By then, Nagin's relationship with Fradella had come under some public scrutiny.

Nagin's public calendar shows two meetings with Fradella on June 24, 2008, including one with Entergy executive Rod West to discuss the possible redevelopment of the Market Street Power Plant. Nagin met with Fradella again a week later, his calendar shows.

Fradella had hoped to land a deal to redevelop the site but never did.

The hulking building has spent much of the past few years caught in a tug-of-war between various would-be developers.

E-mails released in bankruptcy court in late 2010 raised questions about whether former Nagin was trying to advance an economic development project for the city, or working a more personal angle. The e-mails -- released by a group of investors that seized control of the project -- allude to Nagin getting a "piece" of a development deal.

According to the court documents released today, Fradella routed the $50,000 payment through the bank account of a board member of his company "in an effort to disguise the illegality" of the payment. In an effort to legitimize the payment, Nagin made that person a member of the board of a Nagin-owned firm, the document says. Neither the person nor any of the firms is named.

The payment was made months after Nagin's relationship with Fradella started to come under heavy public scrutiny.

Also, during Nagin's tenure at City Hall, Fradella also donated "numerous truckloads" of granite -- the document does not say what its value was -- to the Nagin family's countertop business, Stone Age LLC.

Immediately upon leaving office, Nagin began working for Fradella as a paid consultant, according to the document, which is signed by Fradella. Fradella paid him $10,000 a month, an arrangement that lasted until March 2011, roughly 10 months after Nagin exited City Hall, it says.

Fradella pleaded guilty this morning before U.S. District Judge Susie Morgan, with U.S. Attorney Jim Letten and Inspector General Ed Quatrevaux among those in attendance. His plea agreement calls for a prison term of no longer than seven years. The statutory maximum for the crime Fradella admitted committing is 15 years.

Letten will hold a news conference shortly, his office said.

After Hurricane Katrina, firms associated with Fradella landed various contracts in and around New Orleans: major repairs at Louis Armstrong International Airport, rebuilding sidewalks in the French Quarter, and restoring storm-damaged French Market stalls. The company also got recovery work at several public schools and was hired to rebuild kitchens at Orleans Parish Prison.

One of Fradella's companies, Home Solutions of America, acquired a Florida-based subsidiary called Cornerstone Building & Remodeling in 2005.

Anthony Leeber Jr., Cornerstone's founder, has said that after Home Solutions bought his firm, Fradella pushed him out, liquidated Cornerstone's inventory and sent some of it to Stone Age.

Leeber told The Times-Picayune earlier this year that he had met recently with FBI agents and "told them everything about the mayor, and that was it."

The documents filed this morning do not specify the source of the granite Fradella allegedly gave Nagin.


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