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Kickback, bribery evidence sought in PSERS probe

The Investigator

May 20, 2021 | spotlightpa.org

PSERS watch, election reform, power check, gift ban, prison scandal, turnpike tussle, Capitol company, repeat offender, and an open letter to the GOP.
New details about a federal probe of Pennsylvania's embattled, $64 billion public school pension fund have prosecutors looking for evidence of kickbacks or bribery as they explore why the plan exaggerated investment returns and spent heavily on Harrisburg real estate.

Government subpoenas reviewed by Spotlight PA and The Inquirer demand information from the PSERS fund itself, its executive director, and at least three other senior officials. The documents lay bare the scope of the probe for the first time and show prosecutors and the FBI are investigating possible "honest services fraud" and wire fraud.

Also on the table: A potential cover-up and "benefiting from the cooperation of an insider," sources say.

Elsewhere this week, Marie Albiges reports state Republican lawmakers are seizing on issues with polling locations, ballots, and voting machines during Tuesday's primary as they prepare to pitch a long-awaited raft of election reform proposals. 

By all accounts, Tuesday was a typical off-year, relatively drama-free election. But two prominent state Republican lawmakers — Majority Leader Kerry Benninghoff and Rep. Seth Grove — disagree, calling Tuesday's primary a "mess" with "significant voting issues."

Also this week, Sarah Anne Hughes reports on Tuesday's "yes" vote for reining in a governor's emergency powers, a victory for Republican lawmakers in what was widely seen as a referendum on the Wolf administration's response to the coronavirus pandemic.

Colin Deppen, Spotlight PA

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"We're going to do what I think the voters expect us to do and make the best of it."

—Gov. Tom Wolf on the vote to curtail a governor's executive power in emergencies like the COVID-19 pandemic

» COVID-19 UPDATE: Keep up with our coronavirus tracker, find where to get the COVID-19 vaccine, and sign up for alerts for your county

» See the Pa. lawmakers who spent the most tax money on food, lodging, mileage, and more

» Untested election directors stepped in to fill Pa.'s many vacancies before primary

Lawmakers report receiving fewer gifts during pandemic as push for a ban continues
Every May, state legislators and other public officials are required to file reports detailing, among other items, whether they received pricey gifts, transportation, or hospitality from lobbyists, businesses, nonprofit groups, or others with a stake in government.

Some years, those reports have revealed lawmakers accepting everything from overseas trips to free entry to black-tie galas on someone else's dime.

But for many lawmakers, 2020 was a banner year for staying home — and eschewing people bearing gifts, at least according to their limited disclosure forms.

Public filings with the State Ethics Commission show that, with some exceptions, Pennsylvania's 253 lawmakers did not report receiving anything of great value last year as the pandemic raged, forcing lockdowns and restrictions on travel and in-person gatherings.

The few gifts of note came largely before the first cases of COVID-19 were reported in Pennsylvania in early March. Senate President Pro Tempore Jake Corman (R., Centre), for instance, reported receiving just over $8,500 to attend conferences, including $3,828 from the Pennsylvania Bar Association to go to its mid-year meeting in the Bahamas in late January.

Still, the push to ban elected officials from accepting gifts and other perks continues in the state legislature, despite the fact that past efforts have largely been met with indifference and near total inaction. 

Pennsylvania is in the minority of states with no limit on the size or number of gifts elected officials can accept — the only requirement is disclosure. 

Even that has its limits: In their statements of financial interest filed with the State Ethics Commission each May, they need only disclose gifts worth $250 or more, and transportation and hospitality worth $650 or more. 

Often, elected officials provide few details about a gift other than its worth and who paid for it — and sometimes, it's hard to even discern that much from their reports.

Over the past decade, state lawmakers have introduced bills calling for various types of bans. Many times, the legislation didn't even get a hearing. A key state House committee did advance a measure to prohibit lawmakers from accepting cash and limit other types of gifts in 2019, but the full chamber never took a vote.

Angela Couloumbis, Spotlight PA

A longer version of this story will appear on spotlightpa.org


UNDER COVER: Pennsylvania's Turnpike Commission can spend and borrow staggering amounts of money in a single meeting, but it almost never conducts its business in public, enraging lawmakers and transparency advocates alike. A Post-Gazette investigation found the closed-door approach has been used on multi-million dollar expenditures, billion-dollar bond issues, and the largest layoff in the agency's history.

PRISON CONTRACTOR: "Confidential training" of York County corrections officers carried a six-figure price tag and produced since-deleted images reminiscent of Abu Ghraib. The training involved weapons, a dog, built-in legal defense, and a controversy-plagued contractor, the York Daily Record reports. "I've never in my life been exposed to [that], and unfortunately, I've been in and out of prison for over 23 years," one man said.
CAPITOL CONNECTION: Attendees at state Sen. Doug Mastriano's recent fundraiser in Chambersburg included a recently raided Rudy Giuliani and a suspected Jan. 6 insurrectionist named Sam Lazar. HuffPost reports Lazar took pictures with Mastriano at the event. Both men were at the U.S. Capitol on Jan. 6. Mastriano, a prolific peddler of 2020 election fraud theories, says he left when things turned violent.

REPEAT OFFENDER: The Lehigh Valley-area addiction treatment center with the most violations is part of a nonprofit led by former aides to Govs. Tom Wolf and Ed Rendell, the Morning Call reports. The revelation follows Spotlight PA reporting on dangerous gaps in Pennsylvania's oversight of the addiction treatment industry.

GOP ULTIMATUM: More than 100 former GOP officials, including several from Pennsylvania, signed a letter declaring that if the Republican Party does not break with former President Donald Trump, they'll back the creation of a third party, ABC News reports. Signees include former Pennsylvania Gov. Tom Ridge and former U.S. Rep. Charlie Dent.

» AP: Lou Barletta confirms he's running for Pa. governor in 2022

» CITY & STATE: Conservative groups spent big on ballot questions

» INQUIRER: Mayor Kenney says MOVE probe will go 'deep as we can'

» TRIBLIVE: Pa. businesses grapple with new mask rule, honor system

» WITF: Pediatricians warn against Pa.'s 'Immunization Freedom Act' 

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COVER LETTERS (Case No. 93)Gaze at this sentence for just about sixty seconds and then explain what makes it quite different from the average sentence. What is it?
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