BIRMINGHAM, Ala. (AP) - Birmingham Mayor Larry Langford has been charged with bribery, fraud and other federal charges in connection with multimillion-dollar sewer bond deals when he was president of the Jefferson County Commission.
Federal prosecutors in Birmingham said Langford, Montgomery investment banker Bill Blount and lobbyist Al LaPierre were charged in the 101-count indictment released Monday.
The charges include money laundering and filing false tax returns. Langford and LaPierre pleaded not guilty in a court appearance. They were released on $50,000 bond each.
Blount later traveled to Birmingham to surrender and also pleaded not guilty.
Langford is accused of receiving $230,000 in a series of bribes from Blount, some of them routed through LaPierre, to influence the bond deals.
Blount's Montgomery firm, Blount-Parrish, made $7.1 million from the bond work.
Statement from the Mayor's office:
As you know, the Mayor was detained this morning by federal authorities.
We do not know the details of his detention at this time.
City business will go on as usual as we are all here to do a job and we'll continue to do our jobs to ensure we deliver the best services to the taxpayers of Birmingham.
This is certainly no surprise to us -- we anticipated something happening soon especially knowing Alice Martin's days in office are numbered with the swearing in of a new president in late January -- just a little over a month from now.
We are glad the Mayor will finally have his day in court.
As members of his team, we stand behind him and look forward to the day when we can return the focus to the important issues before the city.
Chief of Staff Mayor's Office City of Birmingham
From the office of U.S. Attorney Alice Martin
LARRY P. LANGFORD, 62, Mayor of Birmingham, Alabama, and former President of the Jefferson County, Alabama, Commission, WILLIAM B. BLOUNT, 55, a Montgomery, Alabama, investment banker, and ALBERT W. LAPIERRE, 58, a lobbyist in Birmingham, Alabama, have been indicted on charges of conspiracy, bribery, fraud, money laundering, and filing false tax returns in connection with a long-running bribery scheme related to bond and other financial transactions of Jefferson County. The 101 count federal indictment was unsealed this morning in U.S. District Court according to U.S. Attorney Alice H. Martin, Special Agent in Charge Carmen Adams of the Birmingham Division of the FBI, and Reginael D. McDaniel, Special Agent in Charge, Internal Revenue Service, Criminal Investigations. This indictment supersedes an indictment returned in June that has remained under seal while the investigation continued.
"Former Commission President Langford owed a duty of loyalty to Jefferson County in the administration of the county's financial affairs. He sold out his public office to his friends Blount and LaPierre for about $235,000 in expensive clothes, Rolex watches and cash to pay his growing personal debt. All the while, Blount was paid fees topping $7 million," said U. S. Attorney Alice H. Martin. "Through a web of financing agreements, Langford required many institutions to use Blount as a consultant so Blount would make fees and in turn payoff Langford. It was a classic pay to play scheme."
LANGFORD conspired to solicit and accept bribes from BLOUNT and LAPIERRE to use his influence as President of the Jefferson County Commission and head of the Department of Finance and General Services to include BLOUNT and his company, Blount Parish & Co., Inc., in Jefferson County financial transactions, primarily bond and swap transactions related to Jefferson County's multi-billion dollar sewer debt. Some of the financial transactions were handled through JP Morgan which, as a condition for getting the financing business of the county through LANGFORD, had to pay Blount Parrish fees, or associate Goldman Sachs which then paid Blount Parrish consulting fees. Another example of LANGFORD'S assistance to BLOUNT was on Ocotber 20, 2003, when LANGFORD, acting for the Jefferson County Commission, entered into a financial transaction for $110 million that included Bank of America and Lehman Brothers Special Financing, Inc. The agreement required Lehman Brothers to pay a broker's fee or arrangement fee of $35,000 to Blount Parrish and Co., Inc. Between 2003 and 2006 BLOUNT and his companies received approximately $7.1 million in fees in connection with Jefferson County financial transactions. BLOUNT, in turn, paid LAPIERRE approximately $219,500 in consulting fees. To influence and reward LANGFORD in connection with Jefferson County financial transactions, BLOUNT and LAPIERRE paid, and LANGFORD solicited and accepted, approximately $235,000 in cash, loan pay offs, and expensive clothing and jewelry.
"The message today should be clear. It does not matter what position you hold or what connections you have. If you choose to violate the public's trust you will be held accountable for your actions," stated Carmen S. Adams, Special Agent in Charge, Federal Bureau of Investigation.
Among the items of value offered by BLOUNT and LAPIERRE and solicited and accepted LANGFORD to influence and reward him in connection with financial transactions from which BLOUNT and LAPIERRE were paid substantial fees are:
BLOUNT transferred $69,000 to LAPIERRE, who wrote a check to LANGFORD for that same amount. LANGFORD then deposited the money into his account and used a portion of the money to purchase audio equipment and expensive clothing. (Counts 1-5)
BLOUNT helped LANGFORD obtain a $50,000 six month, unsecured loan from Colonial Bank. When this loan became past due, LAPIERRE obtained a $50,000 loan from Colonial Bank to pay the LANGFORD loan. BLOUNT then transferred $50,000 to LAPIERRE to pay off LAPIERRE'S Colonial Bank loan.(Count 6, paragraphs 8-9, 16-18)
BLOUNT transferred $30,000 to LAPIERRE, who wrote a check to LANGFORD for that same amount. LANGFORD then used the money to obtain an official bank check to pay his personal taxes. (Counts 7-9)
While on trips to New York City with LANGFORD and others related to Jefferson County bond transactions, BLOUNT bought expensive clothing and jewelry for LANGFORD from stores such as Salvatore Ferragamo, Turbell & Asser, Tourneau, Ermenegildo Zegna, and Century 21. Several of these items were mailed to LANGFORD'S county office. BLOUNT and LAPIERRE set up
an account at Remon's Clothiers in downtown Birmingham for LANGFORD. Over the next several years, LANGFORD bought clothing from Remon's and BLOUNT and LAPIERRE paid LANGFORD'S account. BLOUNT also bought Rolex watches and other expensive jewelry from Bromberg & Co. for LANGFORD. (Counts 10-86).
Counts 87-89 charged LANGFORD with filing false tax returns for the years 2003, 2004, and 2005. He is charged with failing to report taxable income, the value of the bribes, totaling $125,356.73 in 2003; $81,419.52 in 2004; and $22,186.97 in 2005. Counts 95-98 charge LAPIERRE with filing false tax returns for the years 2003 - 2006 for under reporting his income by over $280,000.
"Public officials must comply with the same tax obligations as the citizens they were elected to serve. No one is above the law" stated Reginael D. McDaniel, Special Agent in Charge, Internal Revenue Service, Criminal Investigation.
Counts 90-94 charges BLOUNT with mail fraud and bribery in connection with his bribing of former Jefferson County Commission Mary M. Buckelew who served with LANGFORD on the Commission. These bribes arose from the purchase of expensive items from the Salvatore Ferragamo store and spa treatment on New York City trips in 2003 and 2004.
Buckelew pleaded guilty earlier this fall and agreed to cooperate with the investigation.
Counts 99-101 seek criminal forfeiture in the amount of approximately $7.6 million from each defendant. This amount includes the bribes paid to and accepted by LANGFORD, as well as the fees paid to BLOUNT and LAPIERRE.
LANGFORD is named in 60 counts of the Superseding Indictment, BLOUNT is named in 43 counts, and LAPIERRE is named in 22 counts. The maximum term of imprisonment for each bribery and money laundering count is 10 years, each fraud count is 20 years, the conspiracy count is 5 years, and each tax count is 3 years. In addition to many years in prison, each defendant faces substantial maximum fines.
This case was investigated by Special Agents of the Federal Bureau of Investigation and Internal Revenue Service. Assistant United States Attorneys Matt Hart, Tamarra Matthews Johnson, Scarlett Singleton, and George Martin are prosecuting this case on behalf of the United States.