Trial set on no-bid housing repairs Contractor accused of bribes is father of former board member

November 12, 1995|By Scott Higham | Scott Higham,SUN STAFF

When the Baltimore Housing Authority began a no-bid program for contractors to fix up rundown homes in the city, Larry Jennings Sr. wasted little time winning his share of the $25.6 million windfall in public money.

The father of a Housing Authority board member, Mr. Jennings incorporated two companies and persuaded the city to give him and his family members more than $1.1 million in no-bid housing repair contracts.

Nearly three years after Mr. Jennings won the work, prosecutors are planning to tell jurors in Room 3A of the U.S. District Courthouse this week that a series of cash payoffs paved the way for the Baltimore contractor's success with the city.

Jury selection is scheduled to start tomorrow. The case is expected to take a week to try.

Mr. Jennings is the first contractor charged in a sweeping federal corruption probe of the Housing Authority to request a jury trial. So far, five other contractors charged with paying bribes to win work under the city's no-bid program have pleaded guilty, avoiding the uncertainties of the courtroom and the stiffer penalties that can accompany convictions.

For both sides, there's plenty at stake in the Jennings case.

For Mr. Jennings, a conviction on all five counts of bribery and filing false income tax returns could result in a prison term as long as 39 years. For prosecutors, the case is a critical test of the strength of their corruption probe and their star witness -- a felon whose claims of rampant bribery at the Housing Authority never have been challenged on the stand.

The top prosecutor in Baltimore, U.S. Attorney Lynne A. Battaglia, will handle the case.

Prosecutors say they have amassed 30 cartons of documents that detail a trail of bribery and deceit, revealing how the public trust was compromised for a few thousand dollars. Mr. Jennings paid more than $6,500 in bribes to win the city contracts his family's firms received, according to court files.

Mr. Jennings is alleged to have masked the money trail by laundering the cash through a pair of unsuspecting home improvement subcontractors, the court files show. Prosecutors say he then reported portions of the alleged bribes on his federal tax forms as payments to the subcontractors.

Mr. Jennings' attorney says the case is not as strong as it seems.

"We expect Mr. Jennings to be fully vindicated," lawyer George J. Terwilliger III says.

The case stems from a chaotic $25.6 million no-bid program the Housing Authority created nearly four years ago to quickly repair rundown apartments in the city's worst neighborhoods.

Many of the contractors hired by the city had the right connections.

Mayor Kurt L. Schmoke's brother-in-law received a $315,000 contract. Several close friends of housing chief Daniel P. Henson III won big-ticket deals. And so did Mr. Jennings, whose son, Larry Jennings Jr., was a Housing Authority board member when the work was being doled out from 1991 to 1994.

The elder Mr. Jennings long has denied that his son played any role in the more than $1.18 million worth of city work that went to the two companies the father ran with his wife and his daughter.

One Jennings firm is called Elias Contracting, a home improvement company founded four months after the city began the no-bid program, state records show. The second is called Environmental Protection Co., a lead-paint testing and removal firm that received a $234,688 contract shortly after one of the alleged bribes.

The Jennings case surfaced after complaints about conflicts of interest within the Housing Authority started to reach the FBI three years ago. The FBI and auditors with the U.S. Department of Housing and Urban Development began investigations of the Housing Authority.

Auditors found contractors were paid too much money for work that was performed poorly or not done at all. The FBI found a pattern of payoffs within two divisions of the agency -- the engineering department and the no-bid repair program.

Much of the case against the elder Mr. Jennings revolves around the word of a city management analyst who ran the no-bid program, Charles Morris. He pleaded guilty to bribery charges last year and has been cooperating with the FBI since.

Morris has implicated at least six contractors in the cash-for-contracts scheme, including the elder Mr. Jennings.

Morris says that Larry Jennings Sr. gave him a series of bribes beginning in April 1993, according to court records. He claims that Mr. Jennings gave him two payments of $2,500 each on April 26 and May 5, 1993.

Morris says he received another payment of $1,500 on June 25, 1993 -- about three weeks before the city awarded a $234,688.04 contract to Environmental Protection Co., records show. Prosecutors say the elder Mr. Jennings also gave Morris a series of smaller payments as part of an effort to influence city contracts.

"The government chose not to clutter the indictment with additional counts reflecting the smaller payments," prosecutors say in court papers. "Nonetheless, the government intends to elicit from Morris the fact that these uncharged payments were part of his corrupt relationship with Mr. Jennings."

With no tape-recorded conversations or surveillance videotapes to support the allegations, persuading a jury to convict the senior Mr. Jennings won't be easy, legal experts say. Records such as bank deposits and canceled checks can help. But bribery cases usually turn on the credibility of the key players.

"The prosecuting witness has to be totally believable, and the defendant has to be shown to be not credible," said Baltimore lawyer Benjamin R. Civiletti, who was U.S. attorney general during the Carter administration. "If the defense witness is partially credible, and there are problems with the prosecution's witness, it can be troublesome to convict."

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