September 15, 10

NEWS / Corporate Executive Pleads Guilty to Role in Illegal Campaign Contribution Scheme and to Witness Tam

WASHINGTON - A Natick, Mass., man pleaded guilty today in federal court in Boston to engaging in a scheme to conceal from the Federal Election Commission (FEC) and from the public illegal campaign contributions made to federal campaign committees, and to witness tampering, announced Assistant Attorney General Lanny A. Breuer of the Criminal Division; U.S. Attorney Carmen M. Ortiz for the District of Massachusetts; and Richard DesLauriers, Special Agent in Charge of the FBI in New England.

Martin Raffol, 54, pleaded guilty before U.S. District Court Judge Richard G. Stearns in Boston to one count of engaging in a scheme to conceal material information from the FEC and one count of witness tampering.

“Hiding the true source of campaign funds from election authorities and the public fundamentally impacts the transparency of our democratic system of governance,” said Assistant Attorney General Lanny A. Breuer of the Criminal Division. “The Department of Justice is committed to investigating and prosecuting anyone who tries to evade campaign finance laws and conceal the true source of donations.”

“Today’s conviction should be a reminder that schemes aimed at facilitating illegal campaign contributions will be uncovered and prosecuted to the fullest extent of the law,” said U.S. Attorney Carmen N. Ortiz.

According to the criminal information, Raffol served as executive vice president for a company that provided management services to a portfolio of real estate holdings, including several publically-subsidized housing communities in the Dorchester and Roxbury neighborhoods of Boston. Executives from the company and its parent company actively solicited campaign contributions from various individuals and entities for candidates running for federal, state and local office throughout the years, as part of its business. According to the court document, these executives did so primarily to advance the business interests of the company, including obtaining support for public financing of a large-scale development project within the city of Boston.

As part of an effort to increase the amount of campaign contributions to candidates who supported the company’s projects or who might support these projects in the future, executives and senior management directed Raffol to solicit campaign contributions from vendors who regularly did work for the company.

Raffol admitted that in turn he engaged in an ongoing scheme whereby he caused these vendors to be reimbursed for substantial campaign contributions solicited from them. This included vendors who provided general contracting services, energy services and security services. As a result of Raffol’s scheme, the true source of these vendors’ campaign contributions was disguised from the FEC, similar state authorities and ultimately the public. In total, Raffol caused more than $12,000 in illegal campaign contributions to be made to candidates running for federal office, including candidates for the U.S. House of Representatives. He also caused more than $30,000 in illegal contributions to be made to candidates running for state and local office, including candidates for governor, lieutenant governor, secretary of the commonwealth, state senate, state house of representatives, district attorney, mayor of the city of Boston and Boston City Council. This scheme caused numerous reports, which falsely indicated the source of these contributions, to be unwittingly filed by the relevant political committees with the FEC and similar authorities.

Raffol admitted that he also engaged in witness tampering to conceal the illegal campaign contribution scheme and to prevent law enforcement from learning of the scheme. Specifically, Raffol instructed a witness to lie to authorities if they questioned him about the alleged campaign contribution scheme.

At sentencing, Raffol faces up to five years in prison and a $250,000 fine for the false statement charge, and 20 years in prison and a $250,000 fine for the witness tampering charge. Sentencing has been scheduled for Dec. 8, 2010.

The case was investigated by the FBI. It is being prosecuted by Assistant U.S. Attorney James Dowden of the U.S. Attorney’s Office for the District of Massachusetts and Senior Litigation Counsel William M. Welch II of the Criminal Division.

http://www.justice.gov/opa/pr/2010/September/10-crm-1024.html

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