McLaughlin to Spend Another Year in the Pen

Tally on another year to the incarceration bill of former Chelsea Housing Authority (CHA) Director Michael McLaughlin, as Federal Judge Doug Woodlock sentenced him to a fourth year in federal prison last Friday afternoon in Boston Federal Court.

McLaughlin – who is serving his time in Pennsylvania and has about one year under his jumpsuit belt already – appeared before the court in a far more humble manner on Friday than he did at the same time last year. His hair was far more grey and thin than it was last July and he appeared to have lost a lot of weight and to have acquired a bit of a hunch in the back.

In the interim, it was pointed out that his wife passed away and he was not allowed to attend the funeral, and that he has kept a positive attitude in prison – going so far as to help tutor convicts who are about to be released.

None of that, however, had much to do with the reason McLaughlin was in Federal Court on Friday, which was essentially to answer to additional corruption charges related to the fixing of federal housing inspections while he was the director of the CHA.

Woodlock has been no fan of McLaughlin’s during the entirety of the situation, actually deviating significantly from a plea deal last year that would have given McLaughlin six months to one year in prison. Instead, Woodlock rejected the agreement and re-opened the case completely. When the dust had settled, McLaughlin had three years in jail and a pretty severe tongue lashing from the judge.

This time, however, Woodlock didn’t see a need to change things up, staying with the plea agreement presented to him and giving McLaughlin one additional year in prison and a $3,000 fine.

“I looked at this agreement very, very carefully because it’s a form of plea bargain that takes the court out of it,” said Woodlock. “Looking over my past history, I see there are a large percentage of these [agreements] I haven’t accepted because I haven’t agreed with the outcomes negotiated by the other parties. This is not one of them…I’m satisfied this is a fair and reasonable sentence.”

There was a desire to understand why the housing inspection case wasn’t brought with the false salary declaration case from last summer, and federal prosecutors said it was because they had only learned of the scheme after sentencing was set in the other case.

“The information about these charges only came to light on March 25, 2013 as a result of the co-conspirator bringing the information forward for the first time,” said one federal prosecutor. “By then we were already on the path to get the other case finished and saw no reason to postpone that sentencing…It’s just the chronology of what happened here.”

With that, there began a flurry of federal sentencing guideline calculations by Woodlock, which ended up showing that an additional year – giving four years behind bars in total – would have been the result if both cases were bundled together last year.

McLaughlin said he was sorry that he participated in the scheme and that he had crossed a line that he should not have crossed.

“I’m just sorry I’m back here on another issue,” he said. “I wish it would have been addressed in the beginning…It’s an issue that never should have happened and I am sorry for it.”

Others, such as several long-time tenants from CHA were in attendance – though there was far less of a presence in the courtroom this year as compared to last year. They said afterward that they thought he should have gotten much more time for the inspection rigging. That, they said, probably affected more people negatively than the salary scam.

“I thought it was going to be more than one year because of the condition this crime left the apartments in, and the condition of the apartment I live in,” said Gloria Purdencia of Margolis Apartments, through a translator. “I thought the punishment and fine would have been more severe.”

Mildred Valentin, also of Margolis, has been outspoken during the whole case and was one of two residents hand-picked last summer to address the court prior to sentencing. She said she still wants to know where all the missing money went to that was supposed to fix up the apartments.

“We still are wondering where the money is he took so that they can fix up my apartment and the other apartments,” she said. “Working cabinets would be very nice. The money should be found somewhere and he should be punished.”

Other tenants, however, still live in fear and were hesitant to give their names for fear of retribution – as many loyal members of McLaughlin’s staff remain on the job at the CHA.

“I thought it would have only been fair to give him a lot more time,” said one anonymous tenant. “I was thinking somewhere around another three years.”

CHA Board Chair Tom Standish said he had no opinion on the sentencing, but just felt it pointed to the numerous conspiracies perpetrated by McLaughlin.

“I would only like to express concern that so much damage has been done to CHA and it’s mission of serving some of the poorest residents of our community,” he said. “It does highlight the fact that there were three disparate cases against him and they all fell into what was a web of corruption. It crippled the operation of our organization. Just unravelling the financial aspects of the aftermath has taken years and years of work and restoration.”

The crux of this case against McLaughlin centered around a conspiracy between McLaughlin and two other men to provide the CHA with an advance list of apartments that were to be randomly inspected by the feds.

Bernard Morosco, a retired housing inspector from Utica, NY who had become a consultant, allegedly had solicited McLaughlin and proposed the scheme.

The former director of modernization, James Fitzpatrick, was also allegedly party to the scheme.

Using the list provided by Morosco, McLaughlin would send out SWAT units to hurriedly fix and repair the apartments on the inspection list – leaving all the other apartments in terrible condition. When inspectors showed up and saw such nice conditions in the apartments supposedly looked at randomly, it led to rave reviews and awards for McLaughlin and his staff.

All of it, however, was accomplished by subverting the process and cheating on the random inspections.

“The [random housing inspection] program is a vital program and we think this sentence of imprisonment beyond what he is already serving will send a message that if you game the system, there will be a high price to pay,” said one prosecutor. “That goes not only for executive directors, but also consultants and inspectors too.”

Fitzpatrick and Morosco have not made any agreements with the government in the case, and their cases are still pending in federal court.

Sidebar –

The Chelsea Housing Authority (CHA) met yesterday evening to discuss – among other things – the hiring of an auditor to sort out the financial web that is still tangling up the organization.

Chair Tom Standish said they are looking to get an auditor to do some forensic accounting and clear up how much the CHA actually owes to federal and state housing organizations – money that is still missing allegedly due to former Director Michael McLaughlin hiding and/or taking it.

The current talley is somewhere between $7 million and $9 million. All of it is money that was paid to the CHA during McLaughlin’s tenure by federal and state government agencies in order to fix up apartments and make improvements. However, and this is up for dispute, none of it appears to have been used for any improvements during many years of payments.

Eventually, the CHA will have to work out a payment plan to reimburse the agencies for the missing money. However, no one is still sure just how much is missing and just how much work was not done with the money.

The auditor hired by the CHA is expected to go through the painstaking process of sorting out the situation once and for all.

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