Chagrin Falls man indicted in county corruption probe

3:03 PM, Sep 22, 2011   |    comments
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CLEVELAND -- A federal grand jury returned an 18-count indictment charging Anthony O. Calabrese III and Sanford Prudoff with crimes related to the ongoing Cuyahoga County corruption investigation, federal law enforcement officials said.

Calabrese, 39, of Chagrin Falls, was named in 12 counts including: racketeering; conspiracy to commit mail fraud and honest services fraud; Hobbs Act conspiracy; bribery concerning programs receiving federal funds; conspiracy to commit mail fraud; mail fraud and tampering with a victim, witness or informant.

Calabrese is the son of former Judge Anthony O. Calabrese Jr., who served in the Cuyahoga County Common Pleas Court from 1991 to 2003.

Both men are scheduled to appear in U.S. District Court at 4 p.m. today (Sept. 22).

Prudoff, 68, of Lorain, was employed as Community Development Director for the city of Lorain, Ohio from 1973 through 2009.

He was named in five counts: conspiracy to commit mail fraud; false statements to law enforcement and three counts of false statements on a federal income tax return.

Calabrese and Prudoff are both charged in Count 5, conspiracy to commit mail fraud.

Prudoff was placed on paid leave Sept. 10, 2009, after the FBI told city officials he was a target in the corruption probe. He was escorted from city hall that day.

Two weeks later, Prudoff submitted his retirement papers to city officials, effective Sept. 25, 2009.

Federal officials say the racketeering charge involves conduct that took place between 2001 and 2009 in which Calabrese gave things of value to public officials and their designees in return for public officials taking and promising to take official action that benefitted Calabrese, Law Firm 1 (where Calabrese was an associate and partner), their clients and designees, according to the indictment.

Federal prosecutors had long implicated Calabrese as one of the participants in several schemes in the overall Cuyahoga County corruption probe.

The probe went public in July, 2008, when more than 200 ATF and FBI agents made simultaneous raids on offices and businesses in Cuyahoga County.

To date, more than 50 defendants have been charged and many more people and businesses are mentioned only by alphabetical and/or numerical designations in indictments and charges.

Many times the contracts and board affiliations and clients described in charges and plea agreements matched Calabrese. According to the indictment filed today and previous charges and indictments, Calabrese was "Attorney 1" in previous filings.

Federal officials say Calabrese participated in a scheme in which he and then-Cuyahoga County employee J. Kevin Kelley helped obtain tax exempt status for the property leased by Alternatives Agency around January 2004, according to the indictment.

In previous filings, federal prosecutors said that a client Calabrese represented used then-County Auditor Frank Russo's real estate company, called All State Realty, as a broker for a $30 million property deal.

The deal netted Russo a $50,000 fee, according to the charges. Russo's office then reassessed the property at a much lower value of $24 million, they said.

Prosecutors alleged back in June, 2009 that Calabrese had do-nothing consulting contracts with a technology firm involved in a county mapping project.

Prosecutors also say Calabrese, as lawyer for the board of the nonprofit halfway house Alternatives Agency Inc., gave lucrative consulting contracts to Kelley and former Lakewood mayor and state senator Anthony C. Sinagra -- though they did little work for the agency.

Sinagra admitted to funneling some of his payments to a relative of Calabrese's. Kelley also helped Calabrese gain lucrative contracts with the Parma schools.

Calabrese lobbied Kelley (then a member of the Parma School Board) and other members of the Parma School Board in January 2005 to contract with Business 9 to serve as project manager for a renovation project.

Business 9 was a construction company that specialized in stone and brick masonry and was a client of Law Firm 1, according to the indictment.

In September 2005, the Parma School Board, with Kelley voting in favor, awarded a contract worth $1.8 million to Business 9, according to the indictment.

Calabrese and Kelley arranged for Business 9 to hire The Eagle Group, a consulting company formed by Daniel P. Gallagher.

In August 2009, Business 9 sent a check for $15,000 to Eagle. Gallagher then paid a portion of that money to Kelley and Kevin Payne, according to the indictment.

Other conduct detailed in the indictment includes Calabrese, Kelley, Brian Schuman, former Cuyahoga County Auditor Frank P. Russo and former Cuyahoga County Commissioner James C. Dimora conspiring to increase the funding for Alternatives Agency, according to the indictment.

In or around January 2008, Calabrese, who served as legal counsel for Alternatives Agency, instructed Schuman, an employee of Alternatives Agency, to increase Kelley's monthly consulting fee by $2,000 for four months for the purpose of funding expenses associated with a Las Vegas trip for Dimora, Russo and Public Employee 55, according to the indictment.

Public Employee 55 has been identified previously as Michael Calabrese, Russo's domestic partner.

In or around 2003, Prudoff began receiving payments from Alternatives Agency on a monthly basis, purportedly for consulting work. When BE39 informed Calabrese that Alternatives Agency received no work product from Prudoff, Calabrese told BE39 that Prudoff was consulting on a Lorain expansion project, according to the indictment.

In or around 2002, Calabrese influence Alternatives to hire A.C. Sinagra and Associates. In January 2006, A.C. Sinagra and Associated entered into a contract setting a monthly consulting fee at approximately $1,500, according to the indictment.

In March 2006, Calabrese and Sinagra agreed that Calabrese would cause Alternatives to increase its payments to A.C. Sinagra and Associates, and Sinagra would use the additional funds to pay persons or entities identified by Calabrese in the amounts Calabrese designated, according to the indictment.

Sinagra performed no legitimate work for Alternatives to justify the increase in his fee, according to the indictment. In May 2006, Alternatives increased Sinagra's monthly fee from $1,500 to approximately $6,000.

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