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FORMER EAST ST. LOUIS CITY OFFICIAL PLEADS GUILTY TO FRAUD AND BRIBERY OFFENSES

FOR IMMEDIATE RELEASE
May 23, 2011

The former director of Community Development for the city of East St. Louis was convicted in U.S. District Court on May 20, 2011, for his role in the failed Bowman Estates development project, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today.

Arthur M. Johnson, 61, a former East St. Louis city official, pled guilty to accepting cash payments and agreeing to accept employment with the developer who had been approved to receive $800,000 in federal funds that were administered by the East St. Louis Community Development office. Johnson also pled guilty to knowingly approving a falsified billing invoice that sought to reimburse the developer for expenses that were not actually incurred.

“My office will continue to investigate and root out public corruption wherever it occurs. Our fight against public corruption will go forward, wherever such corruption arises and against whomever commits it. The Department of Justice has made the battle against public corruption one of its priorities, and I welcome the opportunity to engage in prosecuting such corruption at any level. Our good citizens deserve no less than scrupulously honorable conduct by their officials, no matter whether the official is elected or appointed, and I will give the public no less.” said United States Attorney Wigginton.

Johnson was indicted by a Federal Grand Jury on January 21, 2011, for two counts of aiding and abetting wire fraud and one count of accepting improper benefits in connection with business conducted by his office.

The Bowman Estates development project was to have provided low income residents in East St. Louis with fourteen (14) multi-family townhomes, creating 56 rental units located between the 1100 and 1300 blocks of Bowman and Exchange Avenues. The project was approved by the East St. Louis city council and was to have been constructed through a combination of more than $3.6 million dollars of private investment and more than $1.9 million dollars of public funding from both the city and federal governments.

The crime of aiding and abetting wire fraud is punishable by not more than 20 years’ imprisonment, a $250,000 fine, and not more than 3 years’ supervised release upon release from prison. Corruptly Accepting Anything of Value in Connection with Business Conducted Before the East St. Louis Community Development Office is punishable by 10 years’ imprisonment, a $250,000 fine, and not more than 3 years’ supervised release. However, the United States Sentencing Guidelines must be applied to the case and considered by the Court during sentencing. Sentencing is scheduled for September 7, 2011.

The investigation was conducted through the Metro East Public Corruption Task Force by agents from the Internal Revenue Service, The US Department of Housing and Urban Development, and the Federal Bureau of Investigation. The case is being prosecuted by Assistant United States Attorney Steven D. Weinhoeft.

 

 

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