Couple Says Corruption|Burned Down Their House

TRENTON, N.J. (CN) - A married couple says their house burned down because corrupt New Brunswick city officials took money from incompetent contractors who paid bribes "on a monthly basis."

One official got more than $50,000 in bribes, and all the corrupt officials, and the contractors, have pleaded guilty to fraud, according to Aida and Israel Bezares' federal complaint.

The Bezares say that "corrupt cash payments to several employees" of the city and "leniency when performing inspections," or failure to perform inspections at all, allowed the contractors to do poor electrical work, which burned down their house.

The Bezares sued New Brunswick's Department of Planning, Community & Economic Development, and Friendly Maintenance and its two principals, Sam K. John and Joseph McNulty. Friendly Maintenance did the Bezares' work under a $1.3 million contract the City of New Brunswick awarded for a home-improvement program.

The federal complaint states: "This case concerns a scheme to defraud taxpayers and the people of the City of New Brunswick, through a series of illegal payments from the owners of Friendly Maintenance, Inc. to members of New Brunswick's Department of Planning, Community and Economic Development. In exchange for the illegal payments, department employees exercised official influence in favor of Friendly Maintenance through the issuance of government contracts, and ignored the poor quality work Friendly Maintenance performed, causing injury to the plaintiffs.

The Bezares say they applied for a loan through the Department of Housing and Urban Development's Home Investment Partnership Program (HOME), and the Community Development Grant Program. The defendant New Brunswick agency administered the city's money from the funds.

New Brunswick had the Bezares' house inspected and "decided that the bathroom and kitchen in the Bezares' home would be replaced, along with the electrical wiring in those areas," according to the complaint.

The goal of the HOME program is to "provide infrastructure development to remedy substandard conditions in homes in participating jurisdictions" and give deferred loans to "low and moderate income New Brunswick homeowners to repair home systems." Since 1991, New Brunswick has distributed about $13 million in grants through the program.

But the Bezares say that "bribery, fraud and corruption destroy[ed] the integrity of the program," and that bribes were handed out "on a monthly basis."

The city awarded McNulty, John and their company $1.3 million in contract from 2004 to 2006, according to the complaint.

The complaint continues: "It was later discovered that the reason the contracts were steered to Friendly Maintenance, Inc. was because Joseph McNulty and Sam K. John were making corrupt cash payments to several employees within the Department of Planning, Community & Economic Development who, in turn, exerted their official influence in favor of Friendly Maintenance. Moreover, the corrupt cash payments guaranteed that city inspectors would exercise leniency when performing inspections on Friendly Maintenance's projects - if inspections were performed at all.

"The employees within the Department of Planning, Community & Economic Development who received corrupt cash payments in exchange for steering Housing Rehabilitation Program contracts to Friendly Maintenance were: William Walker (Director of the Neighborhood Preservation Project); Richard Kaplan (a city construction inspector and zoning officer); Steven Scott (a city construction inspector); and Linda Carol Roach (a supervisory clerk typist).

"The corrupt cash payments were extensive and said payments were made on a monthly basis to the aforementioned employees of the Department of Planning, Community & Economic Development. For instance, Friendly Maintenance paid William Walker approximately $12,000.00 over a period of five months in 2004, $18,000.00 over a period of seven months in 2005, and $21,500.00 over a period of seven months in 2006.

"William Walker, Richard Kaplan, Steven Scott, Linda Carol Roach and defendants Sam K. John and Joseph McNulty have all pled guilty for their participation in defrauding the people of the City of New Brunswick."

The Bezares say the defendants worked without permits when they repaired the bathroom and kitchen, and the city did not inspect the work when it was done.

The house burned down 10 months later. Fire "'discovered poor workmanship to the house electrical system in the area of the kitchen'" and wrote that "'the most plausible cause to this fire was a short circuit or arcing in the oven's electrical system,'" the complaint states, citing the city Fire Inspector's report.

That report noted that "'no building permits were taken out and no inspections from the building department were conducted.'"

The Bezares seek punitive damages for RICO fraud, breach of contract and consumer fraud. They are represented by George Forbes with Plata, Forbes, Ferrer & Gutierrez of Guttenberg, N.J., and Martin Perez with Perez & Bombelyn of New Brunswick.

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