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Atlanta businessman indicted on 51 counts including bribery, tax evasion, and money laundering

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City of Atlanta contractor Lohrasb “Jeff” Jafari has been charged in a 51 count federal indictment with conspiratorial bribery, bribery, tampering with a witness, tax evasion, money laundering, and structuring.

“Jeff Jafari allegedly paid multiple bribes to two local officials over a period of years and then attempted to obstruct the federal investigation into his misconduct,” said U.S. Attorney Byung J. “BJay” Pak. “He also failed to pay income taxes on millions of dollars he earned from city contracts.  Instead, he used the funds to live a lavish lifestyle.  Whether you bribe, take a bribe, or otherwise misuse the public’s money to enrich yourself – it’s all corruption. We will vigorously pursue any such cases.”

According to U.S. Attorney Pak, the charges, and other information presented in court on March 6, 2019:

  • Beginning at least in 2014 to January 2017, Jafari allegedly paid thousands of dollars in bribe payments to Adam Smith, the then-Chief Procurement Officer of the City of Atlanta.
  • At the time, Jafari was the Executive Vice-President of PRAD Group and did millions of dollars in work with the City of Atlanta, primarily under the City’s Architectural and Engineering contracts.
  • Jafari and Smith met at Atlanta-area restaurants where they discussed City business, among other things, and Jafari would generally pay Smith $1,000 in cash in the restaurant bathroom.
  • Jafari similarly paid bribes to a local official in DeKalb County in April and August of 2014.

According to the U.S. Attorney’s office, in exchange for Jafari’s payments to Smith, Smith provided Jafari with information and counsel regarding the City of Atlanta’s procurement processes, among other information. When PRAD Group or a joint venture in which PRAD Group was a partner became a successful proponent on a City of Atlanta contract or Request for Proposal, Smith approved and submitted the award of those projects. Smith also approved task and/or purchase orders for those projects.

In February 2017, Jafari became aware of the federal investigation into his payments to Smith, at which time he confronted Smith in an effort to intimidate and persuade Smith to provide false information to federal law enforcement about the payments, instructing Smith to deny taking bribe money from Jafari.

Between 2014 through 2016, Jafari also willfully failed to pay income taxes to the IRS. During those years, Jafari withdrew large amounts of cash from corporate bank accounts and used corporate funds for personal expenses, among other things, to avoid the assessment of income tax. In 2014, Jafari owed at least $150,000; in 2015, at least $300,000; and in 2017, at least $700,000 to the IRS. Jafari is additionally charged with numerous counts of money laundering for engaging in financial transactions with funds earned from City of Atlanta work he obtained while he was paying bribes to Adam Smith.

Members of the public are reminded that the indictment only contains charges.  The defendant is presumed innocent of the charges and it will be the government’s burden to prove the defendant’s guilt beyond a reasonable doubt at trial.  This case is being investigated by the FBI and IRS Criminal Investigation.

Source: https://www.justice.gov/usao-ndga/pr/lohrasb-jeff-jafari-indicted-51-counts-including-bribery-tax-evasion-and-money

See federal indictment here: Jeff Jafari-Indictment-03.06.2019

See September 28, 2017 article about guilty plea by City of Atlanta purchasing chief here: https://gtpac.org/2017/09/28/city-purchasing-head-pleads-guilty-to-conspiracy-charge

Atlanta contractors get prison time in contract bribery case

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Two Atlanta contractors were sentenced to prison Tuesday as part of an ongoing federal investigation into a pay-to-play scheme for city contracts.

U.S. District Judge Steve Jones sentenced Elvin R. Mitchell Jr., of Atlanta, to serve five years and pay more than $1.12 million in restitution. Mitchell, 63, pleaded guilty in January to a conspiratorial bribery and money laundering charge.

Jones also sentenced Charles P. Richards Jr., of Tucker, to serve two years and three months in prison and pay $193,000 in restitution. Richards, 65, pleaded guilty in February to a conspiratorial bribery charge.

When imposing the sentences, Jones told each man that their actions had damaged the trust and confidence of the public, cracking the foundation of government.

Keep reading this article at: https://apnews.com/530f2f16f1bc4b8b83b2cede829e2089/Atlanta-contractors-get-prison-time-in-contract-bribery-case

Also see Justice Dept. statement on this case: https://www.justice.gov/usao-ndga/pr/construction-company-owners-sentenced-federal-prison-paying-over-1-million-bribes-city

City purchasing head pleads guilty to conspiracy charge

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Adam L. Smith, the former Chief Procurement Officer for the City of Atlanta, has pleaded guilty to conspiring to accept more than $30,000 in bribe payments from a vendor who obtained millions of dollars in City contracts.

“Great trust was placed in Smith as Chief Procurement Officer for the City of Atlanta, and he abused his position to serve his own financial interests,” said U.S. Attorney John A. Horn.  “Public corruption offenses, like Smith’s, can erode the confidence that the people have in government.”

“The guilty plea of former City of Atlanta Procurement Officer Adams in federal court [on Sept. 26, 2017], will ensure that he is held accountable for his greed based criminal conduct as he now awaits sentencing. It is hoped that this case serves as notice to others that similar such conduct among public officials will not be condoned and that there are severe consequences should that notice go unheeded,” said David J. LeValley, Special Agent in Charge, FBI Atlanta Field Office.

“Public service is a public trust, requiring employees to obey laws and ethical principles above private gain.  Smith abused his public trust to enrich himself at a cost to the taxpayers,” said James E. Dorsey, Acting Special Agent in Charge, IRS Criminal Investigation. “We will continue to work with the FBI and U.S. Attorney’s Office in making these public corruption investigations a priority.”

According to U.S. Attorney Horn, the charges and other information presented in court, Smith served as the Chief Procurement Officer for the City of Atlanta from 2003 to February 21, 2017, overseeing the City’s purchasing activities and its expenditure of billions of dollars in public money for projects.

The conspiracy charge filed by Horn’s office refers to a “vendor” represented by an executive with a construction firm in Atlanta, but does not identify either the vendor or the executive by name.  During Smith’s tenure as the Chief Procurement Officer for the City, he awarded contracts worth millions of dollars to the vendor’s firm and joint venture projects of which the vendor was a partner.

From at least 2015 to January 2017, Smith met privately with the vendor on multiple occasions, frequently at local restaurants. During these meetings, Smith and the vendor discussed Atlanta procurement projects, bids, and solicitations. Often at the time of these meetings, the vendor was actively seeking contracts, projects, and work with Atlanta.

After most of these meetings, the vendor and Smith met in the restaurant’s bathroom, where the vendor paid Smith approximately $1,000 in cash.  In return for the bribe payments, the vendor expected Smith to use his position and power as Atlanta’s Chief Procurement Officer to assist the vendor with contracting/procurement with Atlanta and to furnish the vendor with future benefits and favors when needed.

Given his position, Smith was required to sign annually a financial disclosure statement certifying that he had not received more than $5,000 in annual income from any corporation, partnership, proprietorship, or other business entity other than Atlanta.  Additionally, under Atlanta’s Procurement Code, Smith also had to “make a written determination as to the existence” of any “personal or organizational conflicts of interest exist” between vendors and Atlanta before awarding a vendor a solicited contract. Similarly, Atlanta’s Procurement Code mandated that Smith “certify to the City Council” that the winning vendors had disclosed to Atlanta any “organizational and personal relationships” and that the “award of the contract [was] appropriate.”

Furthermore, in exchange for those cash payments:

  1. Smith met with the vendor on a regular basis;
  2. Smith provided the vendor with information and counsel regarding Atlanta’s procurement processes (among other information);
  3. When the vendor’s firm or joint venture became the successful bidder on an Atlanta contract or request for proposal, Smith approved and submitted the award of such procurement projects or bids to Atlanta’s mayor and City Council for final authorization;
  4. Smith never disclosed his ongoing financial relationship with the vendor and/or the vendor’s firm on his Financial Disclosure Statements to Atlanta; and
  5. Smith never advised Atlanta’s City Council that the vendor’s firm or joint venture had failed to disclose its organizational and personal relationships with him.

In total, from at least 2015 to January 2017, the vendor paid Smith more than $30,000 in cash.

Adam L. Smith, 53, pleaded guilty to conspiratorial bribery.  Sentencing is scheduled for Jan. 16, 2018, before U.S. District Judge Steve C. Jones.

The Federal Bureau of Investigation and Internal Revenue Service Criminal Investigation are investigating this case.

Source: https://www.justice.gov/usao-ndga/pr/city-atlanta-s-former-chief-procurement-officer-adam-smith-pleads-guilty-taking-bribes

See federal conspiracy charge here: Conspiracy Charge – Adam Smith – 09.26.2017

Second construction company owner to enter guilty plea for bribery in connection with City of Atlanta contracts

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Charles P. Richards, Jr., of Tucker, Georgia, was arraigned Wednesday, Feb. 8, 2017, on conspiratorial bribery charges for paying over $185,000 to obtain City of Atlanta contracts.

“From approximately 2010 to August 2015, Richards conspired with E.R. Mitchell to buy lucrative construction-related contracts with the City of Atlanta,” said U.S. Attorney John A. Horn. “Contractors who willingly participate in a pay-to-play contracting system subvert the process for those who try to compete fairly and ultimately undermine the public’s trust in government.”

On Jan. 25, 2017 Mitchell, owner of E.R. Mitchell Company and several subsidiaries, pled guilty to paying over $1,000,000 to an yet-to-be-named individual in exchange for City of Atlanta contracts.

“The arraignment of Mr. Richards illustrates once again that providing bribes in order to obtain government contracts, be it city, state, or federal, can land you in the defendant’s chair as easily as for those accepting the bribes. The FBI continues to work diligently with its various law enforcement partners and federal prosecutors in identifying, investigating, and presenting for prosecution all individuals engaged in these types of criminal public corruption schemes that undermine the legitimate and established practices of government,” said David J. LeValley, Special Agent in Charge, FBI Atlanta Field Office.

“The citizens of Atlanta must be able to trust that government officials will perform their duties in the best interests of the communities they serve,” said Veronica Hyman-Pillot, Special Agent in Charge, IRS Criminal Investigation. “Charles Richards Jr. undermined the process of fair and open competition when he conspired with others to pay bribes in exchange for securing lucrative contracts with the City of Atlanta. Today’s announcement demonstrates our commitment to work in a collaborative effort to promote honest and ethical government at all levels.”

According to U.S. Attorney Horn, the charges, and other information presented in court, Richards serves as the owner and/or principal of the construction companies C.P. Richards Construction Co., Inc., and C.P. Richards & Associates, Inc.

In an effort to obtain construction-related contracts with the City of Atlanta, according to the Justice Dept., Richards and defendant Elvin R. Mitchell, Jr. conspired to pay an individual to obtain government contracts. From approximately 2010 to August 2015, Richards paid over $185,000 to an individual in exchange for City of Atlanta contracts, believing that some of the money would be paid to city official/s who exercised influence over the contracting process.

According to the U.S. Attorney’s office, Charles. P Richards, Jr., 64, will plead guilty on Feb. 16, 2017, before the U.S. District Court Judge Steve C. Jones.

This case is being investigated by the Federal Bureau of Investigation and Internal Revenue Service Criminal Investigation.  First Assistant United States Attorney Kurt R. Erskine and Assistant United States Attorneys Jeffrey W. Davis, and Jill Steinberg, are prosecuting the case.

Source: https://www.justice.gov/usao-ndga/pr/second-construction-company-owner-charged-conspiring-pay-bribes-city-atlanta-contract-0

See the initial Justice Dept. announcement in this case at: https://www.justice.gov/usao-ndga/pr/construction-company-owner-charged-paying-over-1-million-bribes-city-atlanta-contracts

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