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NJ Attorney General Indicts Hoboken Parking Utility Official
- Categorized in: Bribes, Payoffs, and Politics, Hoboken Government, New Jersey State Attorney General Office, Parking Utility
For Immediate Release: December 11, 2009
Office of The Attorney General
- Anne Milgram, Attorney General
Division of Criminal Justice
- Deborah L. Gramiccioni, Director
Former Director of Hoboken Parking Utility Charged with Conspiring with Contractor to Steal More than $600,000 in Parking Meter Funds from City of Hoboken Contractor from Toms River pleaded guilty to stealing more than $1.1 million
TRENTON – Attorney General Anne Milgram announced that John P. Corea, former director of the Hoboken Parking Utility, was indicted today on charges that he conspired to steal more than $600,000 in parking meter revenue that he allegedly split with a Toms River contractor whose company was hired by the City of Hoboken to collect coins from city parking meters.
According to Criminal Justice Director Deborah L. Gramiccioni, Corea, 45, of Hoboken, was indicted today by a state grand jury on charges of conspiracy (1st degree), financial facilitation of criminal activity (money laundering) (1st degree), official misconduct (2nd degree), theft by unlawful taking (2nd degree), and misapplication of government property (2nd degree).
The contractor, Brian A. Petaccio, 49, of Toms River, owner and president of United Textile Fabricators LLC of Toms River, pleaded guilty on Sept. 30 to an accusation charging him with second-degree theft by unlawful taking for stealing more than $1.1 million in coins from Hoboken’s parking meters.
Corea allegedly used his official position to steer three separate no-bid contracts to United Textile Fabricators in November 2005 to collect the coins, count and manage them, and maintain the city’s parking meters. United Textile Fabricators is a coin-operated arcade game manufacturer.
After an audit in 2007 uncovered parking revenue shortfalls, Petaccio and his company returned approximately $575,000 to the city. However, Petaccio admitted in pleading guilty that he conspired with an official of the City of Hoboken – whom he did not name in court but had previously identified to investigators – to divert an additional sum, in excess of $600,000, which was never reported to the city and which the two men split. It is alleged that Corea is the official who conspired with Petaccio and split the money with him.
“This is an outrageous abuse of public trust,” said Attorney General Milgram. “The indictment charges that Corea used his position as director of the Hoboken Parking Utility to conspire with Petaccio in the theft of more than $600,000 in parking meter revenue that should have been used for the benefit of the city and its residents.”
“Corea used his authority to steer three no-bid contracts to Petaccio, who admitted that he stole more than $1.1 million from the city, including funds in excess of $600,000 that he allegedly split with Corea,” Milgram added.
Under his plea agreement, Petaccio must pay $300,000 in restitution to the city and faces up to seven years in state prison. He must cooperate in the ongoing investigation by the Division of Criminal Justice and the New Jersey State Police.
“Local governments and taxpayers are struggling enough in these hard economic times without having to bear the burden of officials and contractors who misappropriate public funds, as alleged here,” said Director Gramiccioni. “We have made cases such as this one a top priority.”
The case is being prosecuted by Deputy Attorneys General Jeffrey J. Manis and Perry Primavera of the Division of Criminal Justice Corruption Bureau. The investigation was conducted by Detective Peter Layng of the State Police Official Corruption Bureau North Unit and Sgt. Lisa Shea of the Division of Criminal Justice Corruption Bureau, with the assistance of Administrative Analyst Kathleen Ratliff, also of the Division of Criminal Justice Corruption Bureau. Deputy Attorney General Manis presented the matter to the state grand jury and took the guilty plea from Petaccio.
It is alleged that while Corea was director of the Hoboken Parking Utility, he improperly solicited Petaccio and United Textile Fabricators LLC and subsequently used his official position to assist the company in obtaining the three no-bid contracts. Each contract was for approximately $27,000 per year, just under the relevant statutory threshold at the time of $29,000, above which public bidding would have been required, allowing other companies to compete for the work.
Between June 2005 and April 2008, Corea allegedly conspired with the company to steal and launder more than $600,000 in parking meter revenues, while continuing to use his official position to assist United Textile Fabricators and conceal its illicit activities. The company’s contracts with the city were effectively terminated by April 2008.
The principal business of United Textile Fabricators is the manufacture, sale and leasing of arcade crane games, coin-operated machines with a crane-like claw that the player uses to try to grab a toy. The company installs its arcade machines in businesses throughout New Jersey, Pennsylvania and Delaware. The proceeds from the machines, which are shared with the company’s clients, are collected by company employees and transported to the company’s warehouse in Toms River where they are counted and bagged for deposit into the company’s main operating account at a local bank. The state’s investigation determined that coins from Hoboken’s parking meters were commingled with coins from the company’s arcade machines and deposited in one lump sum into the company’s operating account, concealing the source and ownership of the funds.
In pleading guilty before Superior Court Judge Francis R. Hodgson in Ocean County on Sept. 30, Petaccio admitted that he knowingly withheld from the City of Hoboken approximately $575,000 in parking meter revenues and misappropriated those public funds to pay a variety of personal expenses and business expenses unrelated to the company’s meter collection activities on behalf of the City of Hoboken. The state’s investigation determined that those personal expenses included credit card bills and car payments for a Porsche and a Mercedes. Petaccio and his company ultimately returned these funds to the city in several installments between October and December 2007, following an audit and inquiry by the city's financial consultants and outside accountants.
However, it is alleged that, in addition to the $575,000 that Petaccio returned the city, he and Corea conspired to steal additional funds exceeding $600,000, which were never reported to the city. The two men allegedly worked out a scheme in which Petaccio reported to Corea the amount of coins collected each day, and Corea would tell him how much to put aside as the “take” to be split between them.
The first-degree money laundering charge carries a maximum sentence of 20 years in state prison and a fine of up to $500,000. Corea could also face a potential anti-money laundering penalty of up to three times the value of the property involved. Second-degree crimes carry a maximum sentence of 10 years in state prison and a $150,000 fine.
In addition, the official misconduct charge carries a mandatory minimum sentence of five years in prison without parole and a lifetime ban on any future public employment. Therefore, if Corea is convicted of both the first-degree money laundering charge and the second-degree official misconduct charge, he faces a mandatory minimum sentence of 15 years in prison without parole.
The indictment is merely an accusation and the defendant is presumed innocent until proven guilty. The indictment is posted with this press release at www.njpublicsafety.com.
The indictment was handed up to Superior Court Judge Pedro J. Jimenez Jr. in Mercer County, who assigned the case to Ocean County, where Corea will be ordered to appear in court at a later date to answer the charges.
Attorney General Milgram and Director Gramiccioni noted that the Division of Criminal Justice has established a toll-free Corruption Tipline for the public to report corruption, financial crime and other illegal activities: 1-866-TIPS-4CJ. Additionally, the public can log on to the Division Web site at www.njdcj.org to report suspected wrongdoing. All information received through the Tipline or Web page will remain confidential.
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