Gifts to Dixon, 3 others queried

Federal subpoenas issued in broad review of efforts to aid minority developers

Signals widening of city probe

April 16, 2004|By Doug Donovan, Tom Pelton and Gail Gibson | Doug Donovan, Tom Pelton and Gail Gibson,SUN STAFF

Federal investigators examining Baltimore's City Council have asked several minority developers about any gifts they gave to Council President Sheila Dixon and three former city officials as part of a broad review of city efforts to assist minority-owned companies.

Subpoenas issued by U.S. Attorney Thomas M. DiBiagio's office requested records reflecting any income, loans or grants received by the developers from the city, signaling a widening of the months-long probe that began with an examination of the City Council's hiring practices and perks.

The subpoenas also sought information on any gifts provided by the businesses to former city real estate officer Anthony J. Ambridge, now a developer, and two former appointees of Mayor Martin O'Malley, Owen Tonkins and Gary M. Brooks, according to sources familiar with the probe.

Brooks left his position Dec. 30 as chief executive of the Baltimore Community Development Finance Corp., a city-related lending agency. Tonkins stepped down at the same time after nearly three years as head of the Mayor's Office of Minority Business Development.

The subpoenas did not identify Dixon and the three former officials as subjects of the probe.

O'Malley, who has made assisting minority-owned firms a high priority of his administration, said he did not know what investigators were looking into with the recent subpoenas.

"It doesn't make any sense for me to comment about an investigation for which I have no information," said O'Malley, who was in Chicago yesterday for meetings on public schools. But he added: "You can do a lot of damage to a person's reputation by mentioning names - names and subpoenas make the front page and acquittals never do."

DiBiagio spokeswoman Marcia Murphy said the U.S. attorney's office could not confirm or deny the investigation.

The federal subpoenas, issued in February, asked for documents related to any city contracts received from 1999 until early this year. WBAL-TV first reported Wednesday night that minority developers had received subpoenas in the probe.

Investigators subpoenaed council members last fall seeking information dating back five years that detailed council members' acceptance of gifts and loans, their outside income, hiring practices and relationships with two local businessmen - Edwin F. Hale Sr., chairman of 1st Mariner Bank; and Ben Greenwald, Arrow Parking's vice president.

Federal prosecutors also are examining potential tax violations in connection with an expense account system that paid council members $5,000 a year with no oversight and permitted them to pocket as income whatever part of that money was not spent on city business.

Reached by phone yesterday, Dixon referred questions about the probe to her office. Her chief of staff, Beatrice L. Tripps, declined to comment.

Brooks said in an interview yesterday that he has not had any contact with federal investigators, although he had said previously that he understood a "common thread is African-American developers" in the federal probe.

"I haven't seen anything," he said yesterday when asked if he had received a subpoena.

Tonkins did not return phone messages seeking comment.

Ambridge said he was angry to learn his name was mentioned in the context of the probe. He said he has received no subpoenas, no calls or visits from anyone connected with the U.S. attorney's office and has no idea why developers would be asked about gifts to him.

"I have no idea what's going on. I certainly have nothing to hide," said Ambridge, a former City Council member who left as real estate officer in 2001 and is now president of Lambda Development. "I am not a minority contractor, although maybe they think I am. ... They [investigators] can come over right now and look at anything they'd like."

The names of all of the area contractors who received subpoenas could not be determined yesterday. At least one businessman said he was interviewed by federal investigators about the same issues but did not receive a subpoena.

Antony M. Gross, vice president of the Ashmon Group LLC of Baltimore, a minority-owned real-estate consulting company, said he got a phone call from a federal investigator in late January asking about his relationship to the City Council. He said he never received a subpoena, perhaps because his answers during that brief 15-minute call indicated that he did no business with the council.

"He [the investigator] asked, `Did you do any work for the City Council?' And my answer was no," Gross said yesterday. "He asked, `Did you give any gifts to the council?' And my answer was no. I guess I passed the phone test because I never received any subpoena after that. I'm one of the lucky ones."

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