Housing aide tied to family company Sister's testimony links board member, firms that got work

November 16, 1995|By Scott Higham | Scott Higham,SUN STAFF Sun staff writer JoAnna Daemmrich contributed to this article.

While serving as a Baltimore Housing Authority board member, Larry Jennings Jr. helped run the finances of a family company that won more than $1 million in no-bid work from the city housing agency, according to testimony in his father's bribery trial.

The younger Mr. Jennings lent money to the company, Elias Contracting Corp. helped balance its books and even wrote chekcs to workers -- all while serving as a Schmoke administration appointee to the very agency that awarded the work to his family's firm.

He had long denied having any involvement in the firm. His sister, testifying as a reluctant witness for the prosecution yesterday, told a vastly different story to jurors in U.S. District Court in Baltimore.

"During the time that I was out [of the office], it was not unusual for him to pay the guys," Georgia Jennings said on the witness stand.

The younger Mr. Jennings, who has since resigned from the Housing Authority, did not return calls for comment yesterday.

The testimony came during the federal bribery trial of Mr. Jennings' father, Larry Jennings Sr. He is charged with paying a housing manager bribes totaling $6,500 in exchange for the no-bid contracts to fix up run-down houses and test them for lead paint.

The elder Mr. Jennings controlled two firms that won no-bid work from the city: Elias and Environmental Protection Co. Together, the companies received more than $1.18 million worth of contracts from the Housing Authority.

In court yesterday, prosecutors laid out what they said was a paper trail showing how the elder Mr. Jennings allegedly paid the bribes to the housing manager, Charles Morris, and then tried to mask the money by falsely claiming the cash as payments to a pair of subcontractors.

With Georgia Jennings on the stand, Assistant U.S. Attorney Kathleen O. Gavin introduced a series of Elias records that had been subpoenaed by a federal grand jury investigating claims of corruption at the housing agency.

Some of the records -- canceled checks, ledger books and deposit slips -- show that the younger Mr. Jennings was personally involved in the finances of the company. The prosecutor presented Ms. Jennings with a ledger book and asked Ms. Jennings a question.

"Who else, to your knowledge, ever balanced the checkbook?" Ms. Gavin asked.

"My brother," Ms. Jennings said.

"Larry Jennings Jr.?"

! "That's correct."

Whose handwriting?

Ms. Gavin asked Ms. Jennings to identify handwriting in an Elias ledger book. She said some of it was her brother's. Ms. Gavin introduced a $9,300 Elias check, dated Feb. 26, 1993, and asked her to identify the signature.

"It's signed by whom?" Ms. Gavin asked.

"Larry Jennings Jr.," Ms. Jennings said.

The prosecutor showed her a Harbor Bank deposit slip with a hand-written note that says the younger Mr. Jennings lent $2,000 to Elias. "Paid Larry Jr. his $2,000 loan back," the note says.

Prosecutors did not introduce evidence yesterday showing whether the younger Mr. Jennings had a financial interest in the company or received a salary. Still, his work on behalf of a family firm while serving on the board of the agency that gave the firm the contracts raises questions of a possible conflict.

Asked whether Mr. Jennings' actions represented a conflict, Housing Authority board chairman Reginald Thomas said in an interview yesterday: "That may have been a problem, yes."

Mr. Jennings wasn't always forthcoming with his board zTC colleagues. When the lead testing contract his family won went before the board for final approval on July 27, 1993, he abstained

from voting.

No word on family ties

He didn't disclose his family ties, saying instead he was "personally acquainted with the parties involved in this matter and felt it was best not to be implicated," according to the minutes of the meeting.

A year later, the younger Mr. Jennings said in an interview with The Sun that he didn't know his family's companies had even received the no-bid work.

A legal expert said yesterday the younger Mr. Jennings might have crossed an ethical line.

"There's an inherent conflict of interest there," said William I. Weston, a professor of legal ethics at the University of Baltimore School of Law. "If he can sign checks, he has a fiduciary duty to the corporation, as he does to the board."

By introducing the corporate records in court yesterday, prosecutors established the groundwork for what they say was a scheme by the elder Mr. Jennings to launder the alleged bribe money through a pair of unsuspecting contractors.

Saafir Abdul Raab's company, BHS Inc., was a subcontractor for Elias in 1993. Prosecutor Gavin showed Mr. Raab an Elias check for $15,000 made out to BHS on May 5, 1993. She asked him to look at the signature on the back.

"Is that your handwriting?" Ms. Gavin asked.

"No," he said.

"Did you ever see this check?"


"Did you ever see the $15,000 from this check?"


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