We haven’t heard much about the Healthy Holly bookgate scandal in Baltimore since May, when former Mayor Catherine Pugh was finally driven to resign from her office in disgrace. At the time, it looked as if she might actually get away with the self-dealing scam she’d been running on the University of Maryland Medical System (UMMS) for years. It turned out that the city had never gotten around to passing a law against that sort of dubious financial activity. (Both the city and the state rushed to pass new laws after all of this was discovered, but those laws wouldn’t apply to her retroactively.)
Well, it looks like the prosecutors investigating the matter found more dirt that we hadn’t heard about. Pugh was finally indicted last week on a variety of corruption and tax evasion charges. The indictments were handed down in secret and the news didn’t break until this morning. (NY Times)
Catherine Pugh, the former mayor of Baltimore, has been indicted on corruption charges connected to money she received for a series of children’s books she wrote, prosecutors made public on Wednesday.There’s a temptation (at least for me) to ask what took so long for this to happen? The stunning part of that entire story, starting from the very beginning, was that this was just such an obvious and blatant case of grifting. Pugh had “sold” tens of thousands of copies of her self-published children’s books to UMMS and other entities doing business and holding contracts with the city. When the scam originally began, she was a state senator, overseeing the operation of UMMS.
Ms. Pugh, who resigned as mayor in May amid state and federal investigations over the sale of her “Healthy Holly” books to companies that had business ties to the city, faces multiple charges, including wire fraud, conspiracy to defraud the United States government and tax evasion.
Most of the “Healthy Holly” books, promoting healthy eating and exercise habits, were never distributed to children as had been promised, the authorities said. Instead, thousands of copies were found in a Baltimore City Public School System warehouse; others were stored in Ms. Pugh’s offices and in one of her houses.
Thanks to the diligent reporting of the Baltimore Sun and other local news outlets, we later learned that piles of the books had never been delivered and were collecting dust in a warehouse. And there were no records that even larger numbers that were paid for had even been printed. Pugh wound up collecting anywhere from $600K to a million, depending on which press reports you were reading.
Before she went to ground and stopped talking to the press, Pugh had assured everyone that everything was legal and she had paid all of her taxes. But based on the description of these indictments, neither of those things were technically true. For starters, it may have been legal under existing laws at that time for an elected official to engage in such no-bid deals with organizations she oversaw, but there were still sales contracts in place. And if you agree to sell something and accept payment for it, you’re expected to deliver.
For both the books found buried in the warehouse and the larger number never printed, those deliveries clearly never happened. And that might give prosecutors the leverage they need to gain a conviction. Also, if she either failed to pay the taxes or reported her income fraudulently, the IRS might have grounds to put her behind bars also. I have no doubt that her lawyers will push for delays and the trial will drag on for months, if not years. But it’s just possible that the citizens of Baltimore will get some long-overdue justice for what appears to be a flagrant case of theft of taxpayer dollars when this is all over.