Key Partner In Winning Criminal Justice Center Bid At The Center Of Major Public Corruption Scandal In Spain

A week ago, Mayor Greg Ballard proudly announced his administration had picked WMB Heartland Justice Partners as the winning team to build, operate and maintain a nearly half billion dollar criminal justice center project after a nearly year-long process shrouded in secrecy, including the administration's refusal to release in advance the Request for Proposal ("RFP") document state law mandated it make public when it initiated the formal bidding process last April. The winning partnership is led by a French-based private equity firm, Meridiam, which includes several other significant partners. One of those partners is Cofely Services, an international facilities management company that is a subsidiary of a giant French energy company, GDF Suez, and that is at the center of  a massive public corruption scandal in Spain that has already led to the arrests of more than 50 officials. If the City-County Council approves the deal proposed by Ballard, Cofely will be responsible for managing the new criminal justice center for the next 35 years.

Cofely Espana is described as the leading beneficiary of public contracts now under investigation by Spanish authorities. The investigation, dubbed Operation Punica, is looking into allegations that bribes were paid to local officials, including several mayors, in exchange for the awarding of public infrastructure contracts. News reports out of Spain indicate local officials skimmed two to three percent from public contracts valued at $318 million. "The collusion between local councillors and civil servants, with builders and energy service companies, and the corruption of middle-men and key companies, has helped them to secure contracts worth around 250 million euros ($300 million) in the last two years alone," said a Reuters report quoting a local prosecutor. The report claimed one of the more than 50 officials arrested, a former deputy president of the Madrid region, Francisco Granados, had millions of Euros stashed in a Swiss bank account. The wide-ranging investigation has issued search warrants on 259 properties and 400 banks, companies and insurers.

The premises of Cofely Espana were searched and key officials questioned by police in late October according to Bloomberg. Cofely relieved its Spanish manager, Didier Maurice, of his duties, along with four other employees ensnared by the investigation. The company says it has ordered an audit following the arrests. The investigation has put considerable pressure on the ruling governing party, People's Party, which is led by Prime Minister Mariano Rajoy. News that members of his party may have been taking bribes while he carried out the largest budget cuts in the country's history is not sitting well with the public. “I understand and share fully the indignation of so many Spaniards at the accumulation of scandals,” Rajoy told parliament in the week following Granados' arrest. “In the name of the People’s Party, I want to apologize to all Spaniards for having appointed to positions for which they were not worthy those who would seem to have abused them.”

One news report said the contracts in question primarily involved those aimed at bringing down electricity costs for municipalities. "It’s curious to see that during these two years of an incredibly tough crisis for citizens and the municipal coffers, when there wasn’t even any land around for rezoning or construction, the suspects managed to find a way to take money out of methods that were aimed at creating savings," said Civil Guard sources. Cofely and its affiliates in Spain were the primary beneficiaries of the contracts according to news reports. A Spanish newspaper reported Cofely had removed a link to its website touting one of the contracts for a suburban Madrid town, Parla, after arrests were made in the investigation. A deleted entry on the firm's website read: "This is the third contract of this kind that Cofely has signed with the Madrid regional government in recent months. As such, Cofely is consolidating its position as a service provider in energy efficiency for public groups and is taking a further step in its ambitions to drive the creation of sustainable cities for the future in our country."

Operation Punica involves the investigation of many crimes, in addition to bribery, including money laundering, tax avoidance, traffic of influence, miss-investment of public funds, falsification of documents, revelation of police secrets, fraud against public administration, participation in business forbidden to public servants and criminal organization. In addition to Granados' arrest, other significant officials arrested included Parma's Mayor Jose Maria Fraile and his predecessor, Tomas Gomez, as well as other mayors from several Madrid communities, a large number politicians, local councilors, officials and businessmen from both those and other parties in Murcia, Castile, Leon and Valencia. 

Mayor Ballard traveled last year to Barcelona, Spain on one of about nine overseas junkets he's taken with his fellow campaign contributors (who pay for Ballard's overseas trips) to accept an award from the electric car industry. Mayor Ballard recently announced the awarding of a fleet contract to Vision Fleet, an untested business from the electric car industry. "I ran into Ballard at the big EV show, EVS 27, in Barcelona, Spain last year, and he pointed out that it can cost $400 to deliver a gallon of gasoline to troops fighting in Afghanistan," Brylawski told Mother Nature Network. "Ballard said he’d convert the entire fleet of 3,500 by 2025, so he’s off to a good start."

Do you trust a decision made by Mayor Ballard regarding this 35-year, $1.75 billion endeavor? You better hope our City-County Council does more than just the cursory review they've grown accustomed to doing when deals of this sort are put before them for approval. While there is no evidence any bribes, kickbacks or payoffs were made in connection with this deal, it has commonly occurred with past projects. Lucky for our corrupt politicians, our federal and local prosecutors in Indianapolis seem more preoccupied with covering up rather than investigating public corruption. The Regional Operations Center corruption is a case-and-point. Besides the work of this blog, the media has shown little interest in delving into that corrupt mess. Despite all of the new information the council's counsel, Fred Biesecker, publicly disclosed at a public meeting last week, the media has had little to say about those new disclosures. One of the interesting items he disclosed was a $70,000 kickback real estate commission paid to Dana Carroll, wife of the ROC's owner, Alex Carroll, from the $9.6 million disbursed from the loan proceeds for the 25-year, $18 million credit-tenant lease agreement. Does anyone actually believe Dana performed any services for that commission?

As a postscript, I want to draw attention to the fact that no other influence peddler accompanied Mayor Ballard on more of his overseas junkets than Ice Miller's Melissa Proffitt Reese. When Ballard first formed his transition committee following his upset victory in 2007 over former Mayor Bart Peterson, job seekers in his new administration were dumbfounded to learn that in order to apply for a job in his administration, you were required to submit your most personal, confidential information about your employment background, including your social security number, to Ms. Reese at her law firm. Nobody could get a job in his administration without first being subjected to a background check by Reese and her law firm. Just imagine all of the one-on-one conversations she had with Ballard on all of those overseas junkets, including private dinners at lavish restaurants where you know Mayor Ballard wasn't picking up the tab. Her law firm billed taxpayers $1 million for the legal work it performed in drawing up the cut-and-paste P3 agreement for the City's parking meter assets.

Reese's law firm, by no coincidence, has landed the job as counsel for the winning bidder for the criminal justice project, WMB Heartland Justice Partners. One of her fellow partners is Tom John, the former Marion Co. GOP Chairman, who was never prosecuted or investigated by the Supreme Court's disciplinary commission despite his admitted role in forging his ex-wife's name on a loan document. John recently registered as a lobbyist seeking to influence the decision-making process. Curiously, the registration didn't appear in online records until about the time the announcement was made. During last week's ROC Investigating Committee meeting, an e-mail from Homeland Security Director Gary Coons to former Public Safety Director Frank Straub revealed that John had contacted city officials urging them to consider the Eastgate Mall property for the ROC, noting his role as the GOP chairman. Don't expect any help from the Indianapolis news media in investigating all of the corruption behind this or the ROC deal. They've been on board since this latest deal was announced a year ago, and they've done everything they can to obstruct and dismiss critics of the deal.