Ray Nagin trial, day four: ‘Politics is a way of doing business in New Orleans’
3:18 PM 02/04/2014
NEW ORLEANS, La. – Ray Nagin’s corruption trial continued Monday as prosecution witnesses recalled a chartered jet flight to New York and a detailed series of stock swaps and consulting fees designed to benefit the former mayor and his family. The prosecution’s case moved along swiftly as eight witnesses took the stand, including one wearing the orange jumpsuit and handcuffs of a federal prisoner.
Developer Frank Fradella concluded his testimony, which had begun Friday, detailing the $112,500 “golden parachute” consulting gig he had set up for Nagin after leaving office. As a consultant to Green Energy Management Solutions, Nagin was to arrange meetings between firm executives and various government officials in an effort to drum up business. Nagin, who also received stock in Green Energy Management then valued at $500,000, was ultimately unable to get any business for the company.
Nagin’s attorney Robert Jenkins tore into Fradella on cross-examination, pointing out that Fradella’s plea agreement on unrelated insider-trading charges was tied in to his testimony against Nagin.
Jenkins later told Daily Caller that he thought his cross-examination of Fradella went well: “These were public contracts, part of the recovery process. We were trying to get it out there that it was public bidding and he had the lowest bid. And we got that out there.” Indeed, Fradella conceded that all but one of the city contracts awarded to his firm, Home Solutions for America, was done through a competitive bidding process that Nagin had no direct control over.
Fradella also conceded that Nagin’s purpose in meeting with Fradella and potential investors in redevelopment projects was to help the city recover from the Katrina-related flooding disaster.
That’s not to say Fradella’s motives were entirely pure.
Later in the day, prosecutors displayed an email from Fradella to his business partner Michael McGrath saying, “There are so many ways to make money in this it’s silly.” Although that project, a proposed NASCAR track, never happened, the prison-jumpsuited McGrath testified: “It was not a fantasy. They were trying to make it happen.”
McGrath told the court that “the only value” Fradella brought to the NASCAR and other redevelopment projects was his relationship with Nagin. “Frank always talked about political influence and his political capital, if you will. Being a lifelong resident of New Orleans, he explained to me that politics is a way of doing business in New Orleans.”
McGrath also described how he funneled $50,000 through his daughter’s trust account to Nagin’s family business, Stone Age Granite, in exchange for a 5% interest in the granite firm. McGrath and prosecutors emphasized that McGrath regarded that 5% holding as bogus and never expected any return from the granite firm.
On cross-examination, Jenkins asked the handcuffed McGrath why he told his sister-in-law, who controlled the trust, that the $50,000 was an investment. Jenkins also emphasized that McGrath hoped that a good recommendation from the Department of Justice to his sentencing judge might result in a reduction of the 14-year sentence he is now serving on unrelated mortgage fraud charges.
On redirect, the prosecution ended McGrath’s testimony with a now-familiar refrain: “Did you deliver for Ray Nagin?”
“Did Ray Nagin deliver for you?”
Other witnesses Monday rehashed the story of free granite deliveries from Home Solutions to Stone Age Granite and detailed the $112,500 in wire transfers for Nagin’s “consulting” gig.
The end of the day featured witnesses dissecting another alleged scheme by Nagin, centering around movie theater owner George Solomon. Former assistant city attorney Paul Ramoni testified that Nagin’s forgiveness of a $54,0000 delinquent tax penalty owed by the theater to the city appeared to be legal but was also totally unprecedented. Prosecutors, alleging a quid pro quo, provided evidence that Solomon, a campaign donor and bundler, paid for a $23,000 two-way charter-jet flight for Nagin’s family to New York City.
Several cringeworthy moments of levity came late in the afternoon during the testimony of Don Hutchinson, a top official for economic development in the Nagin administration. Hutchinson seemed unaware that Housing and Urban Development, which loaned start-up funds to the Grand of the East movie theater, was a federal agency. Hutchinson was also repeatedly unable to read timestamps on emails the government entered into evidence.
The trial continued Tuesday and is expected to last another week or so.