Indianapolis city employees arrested on fraud, bribery charges - 13 WTHR Indianapolis

Indianapolis city employees arrested on fraud, bribery charges

Posted: Updated:
  • HeadlinesHeadlinesMore>>

  • Astronomers spot most Earth-like planet yet

    Astronomers spot most Earth-like planet yet

    Saturday, April 19 2014 8:34 PM EDT2014-04-20 00:34:48 GMT
    Astronomers have discovered what they say is the most Earth-like planet yet detected - a distant, rocky world that's similar in size to our own and exists in the Goldilocks zone where it's not too hot and not too cold for life.More >>
    Astronomers have discovered what they say is the most Earth-like planet yet detected - a distant, rocky world that's similar in size to our own and exists in the Goldilocks zone where it's not too hot and not too cold for life.More >>
  • UPDATE: Missing man with autism found safe

    UPDATE: Missing man with autism found safe

    Saturday, April 19 2014 7:32 PM EDT2014-04-19 23:32:46 GMT
    Jerome Parks, 23, was reported missing around 3:00 p.m. from his group home in the 5100 block of Guion Road on the northwest side, according to authorities. Search crews found him around four hours later in the area of 16th Street and Senate Blvd.More >>
    Jerome Parks, 23, was reported missing around 3:00 p.m. from his group home in the 5100 block of Guion Road on the northwest side, according to authorities. Search crews found him around four hours later in the area of 16th Street and Senate Blvd.More >>
  • A warm pattern takes over

    A warm pattern takes over

    Saturday, April 19 2014 5:44 PM EDT2014-04-19 21:44:21 GMT
    It will be a quiet and calm evening with light breezes out of the east and temperatures will fall into the mid 40's. Easter Sunrise is at 7:00am and the temperature will be around 46 degrees.More >>
    It will be a quiet and calm evening with light breezes out of the east and temperatures will fall into the mid 40's. Easter Sunrise is at 7:00am and the temperature will be around 46 degrees.More >>
INDIANAPOLIS -

Two city employees and three others are accused of using a city program aimed at tackling the abandoned house problem and turning it into a money-making venture. The five face charges involving wire fraud and bribery.

U.S. Attorney Joe Hogsett announced the indictments Tuesday afternoon following a two-month investigation that began with a tip from confidential informant.

Reggie Walton, who heads the Indianapolis Land Bank, and John Hawkins, a senior project manager with the Department of Metropolitan Development were arrested. So were David Johnson with the Indianapolis Minority Aids Coalition, Randall Sargent with New Day Residential Development and Aaron Reed with Naptown Housing Development.

"It's alleged that Mr. Walton and Mr. Hawkins turned this program on its head," said Hogsett.

Through the land bank, the city acquires distressed properties then sells them to buyers willing to fix them up. Hogsett said the scheme involved selling properties to non-profit groups (which are able to buy them for as little as $1,000) which in turn sold them to for-profit developers (which usually have to bid on them) at reduced prices.

Hogsett said Walton and Hawkins "used non-profits and a real estate firm run by the co-defendants to unload city-owned property at greatly discounted prices."

He said they accepted kickback pay for arranging the sales and that Walton accepted a $500 bribe from an undercover FBI agent. Walton was also described as a silent partner with Naptown Housing, "handpicking" land bank parcels for Reed to buy.

Asst. U.S. Attorney Brad Blackington said all five men charged profited from the deals "in excess of $100,000."

The charges were announced after FBI agents and state police spent much of Tuesday morning removing boxes of records from the land bank office on the 20th floor of the City-County Building.

Aaron Thies, executive director of DMD, said of the charges, "We're extremely disappointed to hear we had this issue with employees. In our department we strive greatly to do our best work for citizens."

Thies said both Walton and Hawkins were suspended without pay while the investigation continues.

Blackington said it was possible more arrests could following depending on what other evidence they uncover.

Statement from Mayor Greg Ballard:

"I take these allegations very seriously and I will not tolerate abuse of the public trust. That's why I initiated the toughest ethics and first whistleblower laws in the history of the city.

Mr. Walton and Mr. Hawkins are suspended without pay effective immediately.

I appreciate the work of federal officials in this matter and my team will continue to assist them in this investigation. The alleged acts of these two individuals do not reflect the dedication of the thousands of employees who work hard to improve our city every day."

  • Most Popular StoriesMost Popular StoriesMore>>

  • Friends, colleagues remember life of slain IMPD officer

    Friends, colleagues remember life of slain IMPD officer

    Saturday, April 19 2014 12:34 PM EDT2014-04-19 16:34:23 GMT
    Picture provided by familyPicture provided by family
    The influence of an IMPD officer killed by her ex-husband in a murder-suicide went far beyond the police department. Neighbors and those who worked with Ofc. Kimberlee Carmack are still trying to understandMore >>
    The influence of an IMPD officer killed by her ex-husband in a murder-suicide went far beyond the police department.More >>
  • Franklin mom visited by phony CPS workers

    Franklin mom visited by phony CPS workers

    Thursday, April 17 2014 8:11 AM EDT2014-04-17 12:11:37 GMT
    A Franklin woman is warning other mothers after she says two people came to her house and threatened to take her children.More >>
    A Franklin woman is warning other mothers after she says two people came to her house and threatened to take her children.More >>
  • Murder-suicide tragedy rare, but followed pattern

    Murder-suicide tragedy rare, but followed pattern

    Friday, April 18 2014 11:49 PM EDT2014-04-19 03:49:46 GMT
    The domestic violence case that ended in the murder-suicide of two IMPD officers reveals a serious danger for police officers that goes far beyond the risks they face each day in the line of duty.More >>
    The domestic violence case that ended in the murder-suicide of two IMPD officers reveals a serious danger for police officers that goes far beyond the risks they face each day in the line of duty.More >>
Powered by WorldNow