Former Cook County Commissioner Moreno Sentenced to 11 Years in Prison for Public Corruption Schemes

CHICAGO—Former Cook County Commissioner JOSEPH MARIO MORENO was sentenced today to 11 years in federal prison for engaging in a series of public and personal corruption schemes over a span of three years. Moreno pleaded guilty on July 1, 2013, to conspiracy to commit extortion after he was initially charged in late June 2012, about 18 months after he left public office.
Moreno, 61, of Chicago, a lawyer who served more than 16 years as an elected county commissioner until December 2010, was sentenced to 132 months in prison, and he was ordered to forfeit $100,000 and pay a total of more than $138,000 in restitution by U.S. District Judge Gary Feinerman. Moreno was ordered to begin serving his sentence on April 21.
“Mr. Moreno was not a reluctant participant in these schemes; he was an eager participant,” Judge Feinerman said, adding that Moreno “embraced them with gusto and pursued them with vigor.”
Moreno “repeatedly pursued his own interests at the expense of those he was supposed to serve. . . . [H]e extorted a reputable business and corrupted the highest levels of Cook County government, the Town of Cicero, and a private hospital. He also evaded taxes and suborned perjury so he could reduce his child support obligations. And when he was confronted about his crimes, he obstructed justice by providing the government with false invoices in an effort to conceal his criminal conduct,” Assistant U.S. Attorneys Christopher J. Stetler and Megan C. Church wrote in a government sentencing memo.
Notably, they argued, Moreno conceived a motto of governing that captured his corrupt approach to public office: “I don’t want to be a hog. I just want to be a pig. Hogs get slaughtered. Pigs get fat.”
Moreno pleaded guilty to conspiracy to extort an unnamed company that was awarded a contract to help improve Cook County Hospital’s revenue cycle into using his friend and co-defendant, Ron Garcia, and his business, Chicago Medical Equipment & Supply, Inc., as a minority subcontractor in return for a $100,000 bribe. Garcia forgave a $100,000 mortgage loan to Moreno in exchange for Moreno’s efforts to steer the lucrative sub-contract to Garcia’s company, and Moreno tried to disguise the bribe by claiming that he had repaid the purported loan.
In pleading guilty, Moreno also agreed that he sought to obtain orders of Dermafill bandages from Cook County in return for kickbacks while he and his staffer, co-defendant and former Chicago Alderman Ambrosio Medrano, were Cook County officials; sought to obtain approval for a waste-transfer station in return for kickbacks while a Town of Cicero official; and evaded his federal income taxes between 2007 and 2010 by misreporting the income from his law office.
According to sentencing documents, between 2008 and 2010, Moreno engaged in those schemes, as well as five other schemes to:

• enrich himself through kickbacks in return for passing a “green” resolution while a Cook County Commissioner;
• obtain medical transcription business from Cook County in return for kickbacks concealed as legal fees;
• obtain orders of Dermafill bandages from a private hospital by bribing a hospital official; enrich himself through kickbacks while a Town of Cicero official;
• reduce his child-support obligations by suborning perjury during a court hearing. 

Medrano, 60, of Chicago, the former alderman who later worked on Moreno’s countystaff, was sentenced last month to a total of 13 years in federal prison after pleading guilty in one case involving Moreno and being convicted at trial last year in a separate corruption case that stemmed from the same FBI undercover investigation.
Garcia, 54, of Homer Glen, and two other co-defendants, Gerald W. Lombardi, 61, of Darien, and his son, Jerry A. Lombardi, 34, of Downers Grove, who were agents of Chasing Lions, LLC, a disabled-veterans-owned business in Lisle that sold the Dermafill bandages, pleaded guilty to their roles in the scheme and are awaiting sentencing. A sixth co-defendant, Stanley Wozniak, 51, of Chicago, is awaiting the disposition of charges.
The Moreno sentence was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Robert J. Holley, Special Agent in Charge of the Chicago Office of the Federal Bureau of Investigation; and James C. Lee, Special Agent in Charge of the Internal Revenue Service Criminal Investigation Division.

Amid corruption inquiry, Turkish prosecutor slams police

A Turkish prosecutor has openly accused police of interfering with a high-level corruption investigation.

"Court orders have not been carried out and there has been open pressure on the judicial process from both the chief prosecutor's office and from the police force, which is supposed to carry out the decisions of the courts," Muammer Akkas said in a Thursday statement.

He spoke one day after three Cabinet ministers resigned their posts, after their sons were arrested or temporarily detained in an anti-graft sting, semiofficial news agency Anadolu reported.

One of them, Urbanization and Environment Minister Erdogan Bayraktar, went further than the other two, not just resigning his Cabinet position but also calling on Prime Minister Recep Tayyip Erdogan to step down.

Turkish media reported a possible second wave of detentions as imminent late Wednesday, but the raids did not materialize.

Instead, an apparent deadlock within the judiciary emerged as Akkas, the prosecutor, issued his statement saying the judiciary was under the heel of the government.

Akkas accused police and prosecutors of ignoring a decision of the courts by refusing to carry out more raids.

In a televised statement, Chief Istanbul Prosecutor Turan Colakkadi fired back, saying that Akkas had mishandled the investigation and leaked information to the press, leading to his removal from the case.

Economy Minister Zafer Caglayan and Interior Minister Muammer Guler, whose sons were also arrested in the investigation, also resigned Wednesday. Erdogan accepted the resignations, Anadolu reported.

The sons were detained in a roundup that included the head of a public bank, several bureaucrats and high-profile businessmen. The roundup came after a two-year investigation by the Istanbul Prosecutor's Office into allegations of corruption including money laundering, gold smuggling and bribery.

Many analysts see the corruption investigation as a public fight between Erdogan and Fethullah Gulen, an Islamist preacher living in self imposed exile in Pennsylvania.

Erdogan has repeatedly said since the corruption arrests began that international organizations with branches inside Turkey are trying to destabilize the country.

"This country has never been and never will be the operational space of international organizations. We will not allow the interest lobby, the war lobby, the blood lobby to carry out an operation under the guise of a corruption operation," he said Sunday.

Turkey is expected to hold local elections next year, and some analysts see the raids as a test of Erdogan's grip on power, especially after a turbulent year of unprecedented anti-government protests.

Demonstrations continued Thursday, with marches in Istanbul, Mersin, Izmir and Adana, where police used water cannons on marchers.

Protesters chanted: "The ministers are thieves," "Everywhere is bribery, everywhere is corruption," the "Public will clean this dirt" and the "Prime Minister is a thief."

The Prime Minister had been expected to reorganize his Cabinet, because some of his ministers will be running for office in March. Late Wednesday, he announced a Cabinet shuffle, naming 10 new people.

After the announcement, former Culture Minister Ertugrul Gunay tweeted his displeasure.

"I wish success to the new members of the Cabinet. I will suffice to say for now that I don't find the choices for Justice and Interior positions suitable," he wrote Wednesday.

One day later, he and two other members of parliament -- Izmir MP Erdal Kalkan and Ankara MP Haluk Ozdalga -- were sent to Erdogan's ruling Justice and Development Party's disciplinary committee with a request for their dismissal.

According to Anadolu, the party announced it is taking this disciplinary action against three of its members for "disparaging remarks" against its ideals and core policies.

ADM Subsidiary Pleads Guilty to Conspiracy to Violate the Foreign Corrupt Practices Act

WASHINGTON—A subsidiary of Archer Daniels Midland Company (ADM) pleaded guilty today and has agreed to pay more than $17 million in criminal fines to resolve charges that it paid bribes through vendors to Ukrainian government officials to obtain value-added tax (VAT) refunds, in violation of the Foreign Corrupt Practices Act (FCPA).
Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney James A. Lewis of the Central District of Illinois and Special Agent in Charge David A. Ford of the FBI’s Springfield Division made the announcement.
“As today’s guilty plea shows, paying bribes to reap business benefits corrupts markets and undermines the rule of law,” said Acting Assistant Attorney General Raman. “ADM’s subsidiaries sought to gain a tax benefit by bribing government officials and then attempted to deliberately conceal their conduct by funneling payments through local vendors. ADM, in turn, failed to implement sufficient policies and procedures to prevent the bribe payments, although ultimately ADM disclosed the conduct, cooperated with the government, and instituted extensive remedial efforts. Today’s corporate guilty plea demonstrates that combating bribery is and will remain a mainstay of the Criminal Division’s mission. We are committed to working closely with our foreign and domestic law enforcement partners to fight global corruption.”
Alfred C. Toepfer International Ukraine Ltd. (ACTI Ukraine), a subsidiary of ADM, pleaded guilty in the Central District of Illinois to one count of conspiracy to violate the anti-bribery provisions of the FCPA and agreed to pay $17.8 million in criminal fines. The Department of Justice also entered into a non-prosecution agreement (NPA) with ADM in connection with the company’s failure to implement an adequate system of internal financial controls to address the making of improper payments both in Ukraine and by an ADM joint venture in Venezuela.
In a parallel action, ADM consented with the U.S. Securities and Exchange Commission (SEC) to a proposed final judgment that orders the company to pay roughly $36.5 million in disgorgement and prejudgment interest, bringing the total amount of U.S. criminal and regulatory penalties to be paid by ADM and its subsidiary to more than $54 million.
According to the charges, from 2002 to 2008, ACTI Ukraine, a trader and seller of commodities based in the Ukraine, together with Alfred C. Toepfer International G.m.b.H. (ACTI Hamburg), another subsidiary of ADM, paid third-party vendors to pass on bribes to Ukrainian government officials to obtain VAT refunds. The charges allege that, in total, ACTI Ukraine and ACTI Hamburg paid roughly $22 million to two vendors, nearly all of which was to be passed on to Ukrainian government officials to obtain over $100 million in VAT refunds, resulting in a benefit to ACTI Ukraine and ACTI Hamburg of roughly $41 million.
According to the NPA with ADM, a number of concerns were expressed to ADM executives, including an e-mail calling into question potentially illegal “donations” by ACTI Ukraine and ACTI Hamburg to recover the VAT refunds, yet nonetheless failed to implement sufficient anti-bribery compliance policies and procedures to prevent corrupt payments.
In addition to the monetary penalty, ADM and ACTI Ukraine also agreed to cooperate with the department, to periodically report the companies’ compliance efforts, and to continue implementing enhanced compliance programs and internal controls designed to prevent and detect FCPA violations.
The agreements acknowledge ADM’s timely, voluntary, and thorough disclosure of the conduct; ADM’s extensive cooperation with the department, including conducting a world-wide risk assessment and corresponding global internal investigation, making numerous presentations to the department on the status and findings of the internal investigation, voluntarily making current and former employees available for interviews, and compiling relevant documents by category for the department; and ADM’s early and extensive remedial efforts.
The department acknowledges and expresses its appreciation for the cooperation and assistance of German law enforcement authorities, which, in a parallel investigation, reached a resolution with ACTI Hamburg regarding its role in the bribery scheme.
In addition, the department acknowledges and expresses its appreciation for the significant assistance provided by the SEC’s Division of Enforcement.
This ongoing investigation is being conducted by the FBI. The case is being prosecuted by Trial Attorney Daniel S. Kahn of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Eugene Miller of the Central District of Illinois, with significant assistance from the Criminal Division’s Office of International Affairs.