South Gate Fraud Charges Overturned, Bribery Stands

9th Circuit CourthouseThe former treasurer of South Gate, California and a paid consultant had some, but not all, of their corruption and bribery convictions reversed Monday by a federal appeals court.

The 9th Circuit Court of Appeals overturned convictions of Albert Robles for fraud, money laundering and theft-of-honest-services based on unconstitutional jury instructions that allowed the improper theory of failure to disclose a conflict of interest.

Robles was treasurer of South Gate. He and local businessman and friend, George Garrido, were convicted in two schemes to award city contracts to particular companies while reaping substantial financial awards for themselves.

But the theft-of-honest-services charge has been significantly narrowed by U.S. Supreme Court in the wake of the Enron accounting scandal involving Jeffrey Skilling, Enron’s former CEO. His original conviction for theft of services was overturned based on the unconstitutional jury instructions.

Now law has been applied to Robles, whose appeal was pending at the time of the Skilling ruling.

Robles was convicted in 2005 of 16 counts of theft of services, mail fraud, wire fraud, money laundering and bribery. The case was appealed in 2006 but was not argued until 2010 and has been lingering on appeal awaiting Monday’s decision.

The allegations were that he defrauded citizens of the city in a scheme to award three contracts: a $24 million contract to build senior housing; a $4 million sewer rehabilitation contract and a $48 million trash-hauling contract, according to federal prosecutors. Robles, his family and friends allegedly received $1.4 million for directing the contracts.

Garrido received a lucrative consulting contract from the trash hauler in exchange for the city award of the 10-year contract. He was convicted of five counts of mail fraud.

The appeals court upheld two counts of bribery against Robles, according to Judge Harry Pregerson

But the court ordered outright acquittal on four counts of honest services fraud against Robles, reversed another 19 of the counts and reversed four counts of money laundering, also against Robles.

Three honest services counts were reversed against Garrido.

The appeals court sent the case back to U.S. District Judge Stephen Wilson to sort out what remains and how to proceed from here.

Case: U.S. v. Robles, Garrido, No. 06-50717, 06-50718

 

 

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