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Ex-New Orleans Mayor Nagin Charged With Kickback Scheme

Ray Nagin, the former New Orleans mayor who led the city during Hurricane Katrina, was charged with taking part in a bribery scheme that U.S. prosecutors said involved payments in cash, granite and trips to Hawaii.

Nagin, 56, who was mayor from 2002 to 2010, took kickbacks for giving favorable treatment to city contractors, according to the 21-count indictment unsealed yesterday in federal court in New Orleans. He accepted cash and free travel, as well as inventory for a family business, Stone Age LLC, according to the indictment.

The former mayor is charged with conspiracy, money laundering, bribery, honest services wire fraud and filing false tax returns for actions allegedly carried out between 2004 and the present. Nagin faces a maximum 20-year prison sentence if convicted of the most serious counts against him, the U.S. Attorney’s Office in New Orleans said in a statement.

“This office will continue its history of investigating and prosecuting public corruption,” U.S. Attorney Dana Boente said in the statement.

Nagin’s arraignment is scheduled for Jan. 31 in New Orleans before U.S. Magistrate Judge Daniel Knowles III, according to court filings. His lawyer, Robert Jenkins, has denied the charges.

Cable Executive

A Cox Communications Inc. executive before his election, Nagin ran on a platform of ending political patronage and corruption in city government. He left the mayor’s office because of term-limits in May 2010. The former mayor now lives in Frisco, Texas, according to the prosecutors’ statement.

“This is a sad day for the city of New Orleans,” the current mayor, Mitch Landrieu, said yesterday in a statement. “Today’s indictment of former Mayor Ray Nagin alleges serious violations of the public’s trust,” said Landrieu, whom Nagin defeated in a run-off election in 2006, as the flood-damaged city struggled to rebuild from Katrina in August 2005.

One of the contractors named in Nagin’s indictment, Frank Fradella, agreed last year to plead guilty to conspiracy, according to court filings. Prosecutors accused Fradella of agreeing to provide “things of value to Public Official ‘A’ in connection with a series of City of New Orleans transactions,” according to a June court filing.

‘Free Granite’

The contractor funneled a $50,000 payoff and “truck loads of free granite” to the official, who isn’t identified by name, as well as monthly payments of more than $10,000 after the official left office in May 2010, according to the filing in Fradella’s case. Yesterday’s indictment says the granite was a payoff for Nagin.

Nagin is also accused in the indictment of directing no-bid work to a businessman in exchange for travel and lodging expenses in Hawaii. The same contractor also provided mobile- phone service to Nagin’s family, the U.S. alleged.

The case is U.S. v. Nagin, 13-cr-11, U.S. District Court, Eastern District of Louisiana (New Orleans).

To contact the reporter on this story: Allen Johnson Jr. in New Orleans federal court at allenmct@gmail.com

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net

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