U.S. Attorney for the District of Maryland Robert K. Hur speaks at a press conference Nov. 20, 2019, after a federal grand jury indicted former Baltimore Mayor Catherine Pugh in relation to "Healthy Holly" children’s book sales. (Ian Round/Capital News Service)

Former Baltimore mayor indicted on federal fraud charges

By: Ian Round, Capital News Service

BALTIMORE — Former Baltimore Mayor Catherine Pugh fraudulently enriched herself, funded her mayoral campaign and sought to advance her political career through the sale of her “Healthy Holly” children’s books, according to a federal grand jury indictment released Wednesday.

Pugh, 69, was indicted on 11 counts of wire fraud, conspiracy to commit wire fraud, conspiracy to defraud the United States and tax evasion.

Gary Brown and Roslyn Wedington, who both worked for Pugh in the Maryland Senate and in the Baltimore mayor’s office, pleaded guilty to related charges.

According to the indictment, Pugh and Brown defrauded purchasers of the books in order to enrich themselves, advance Pugh’s political career and fund her mayoral campaign. Many of the books were never delivered, and many were double-sold, the indictment states. Pugh made nearly $800,000 from the alleged conspiracy, the indictment says.

Additionally, the indictment states, Pugh filed a tax return stating her income in 2016 was just over $31,000. In fact, her income was more than 10 times that—$322,365—meaning she owed the federal government more than $100,000.

“There are many victims in this case,” said Robert K. Hur, the U.S. attorney for the District of Maryland, in a press release. “Corrupt public employees rip off the taxpayers and undermine everyone’s faith in government.”

Hur stated his office would “zealously pursue those who abuse the taxpayers’ trust.”

In a press conference on Wednesday, Jennifer C. Boone, the special agent in charge of the FBI’s Baltimore field office, said Pugh had violated the “sacred trust” constituents place in their elected officials.

“One of our greatest privileges and responsibilities is the vote,” Boone said. “Ms. Pugh violated that trust and abused her position.”

Pugh, who resigned in May amid the scandal, faces one count of conspiracy to commit wire fraud, seven counts of wire fraud and two counts of tax evasion.

Her attorney, Steve Silverman, declined to comment. In an email to Capital News Service Wednesday, he said he would “address this matter in open court tomorrow.”

Pugh is scheduled to be arraigned at 1 p.m. Thursday at the U.S. District Court in Baltimore. According to the press release, she is expected to self-surrender before the hearing.

Pugh owned Healthy Holly LLC, the company through which she sold the books. She published four books promoting healthy lifestyles between 2011 and 2017.

Hur declined to say whether he viewed the purchasers as victims or co-conspirators.

“The overwhelming number of books published by Healthy Holly was not sold through retail or wholesale vendors,” the indictment states. “(R)ather, they were marketed and sold directly to non-profit organizations and foundations, many of whom did business or attempted to do business with Maryland state government and Baltimore City.”

Brown, 38, pleaded guilty on Nov. 13 to conspiracy to commit wire fraud, two counts of conspiracy to defraud the United States and to filing a false tax return. On the same day, Wedington, 50, pleaded guilty to five counts of filing a false tax return and to conspiracy to defraud the United States.

Pugh faces a maximum sentence of 175 years in prison, although the press release notes sentences are typically shorter than the maximum. Brown and Wedington each face a maximum prison sentence of 20 years. The press release notes a judge has not scheduled hearings for their sentencing.

“Those kinds of things take time and thought,” Hur said at the press conference. “The public should be confident that we are conducting a very, very thorough investigation.”

Pugh, a Democrat, was elected mayor of Baltimore in 2016. She served in the Maryland Senate from 2007, rising to the position of majority leader, until she was elected mayor.

In a statement, Maryland House Speaker Adrienne Jones, D-Baltimore County, said officials need to be “bold and transparent,” and hold themselves to a higher standard.

“Baltimoreans are resilient and, once again, we will pick ourselves up and keep moving forward,” Jones said.

Hur said he was not at liberty to respond to many of the reporters’ questions. One reporter asked who was the “mastermind” of the scheme. Another asked whether the purchases were used to buy influence or preferential treatment.

“All very interesting questions, but not ones that I can answer,” Hur said. He stressed that an indictment does not mean that Pugh has been found guilty, and he declined to say whether Pugh had entered into a plea agreement.

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