At an evening press conferen3 new indictments expand Dayton public corruption probece, Dayton Mayor Nan Whaley says “Any type of fraud we take really seriously.” She aid that she has “just seen the indictments.”
The mayor said it’s “an ongoing investigation and we can’t really comment on it.”
UPDATE @ 2:50 p.m.:
Federal investigators have identified the three people indicted on fraud charges in connection to a public corruption investigation in Dayton.
RELATED: Ex-Dayton commissioner, state lawmaker arrested; more arrests coming, feds say
Steve Rauch, 64, of Germantown, Joyce Cameron, 71, of Trotwood, and James Cameron, 80, of Trotwood, were all indicted by a federal grand jury, according to the U.S. Department of Justice.
RELATED: City investigating after corruption charges allege contracting fraud in Dayton
All three are facing one charge of conspiracy to commit mail fraud and six counts of aiding and abetting mail fraud.
If found guilty, the crimes are punishable for up to 20 years in prison, according to investigators.
>>PREVIOUS: Prominent businessman Rauch denies wrongdoing in investigations
Rauch, a longtime Dayton-area businessman, made an initial appearance in federal court earlier today and entered not guilty pleas to all counts.
Joyce Cameron, a former mayor of Trotwood, and her husband, James, did not appear in court today. Joyce owns and operates Green Star Trucking and James is an employee of the company, according to the DOJ.
>>RELATED: These documents reveal what feds are looking at in Dayton-area probe
Court documents allege Rauch, along with the Camerons, fraudulently convinced government entities to award and pay out demolition contracts that were worth hundreds of thousands of dollars, U.S. Attorney Benjamin Glassman said during a news conference.
Glassman said Rauch’s companies sought and obtained contracts from 2012 to 2014, including from the city of Dayton, some of which required subcontracting with disadvantaged businesses.
“Although Rauch and his company said he would subcontract a certain portion of the work to disadvantaged businesses as per the contract, in fact he did not. His company did all the work. Instead, he used Joyce Cameron, the owner of a company called Green Star Trucking, as his straw or his front,” Glassman said.
The Camerons signed paperwork and in exchange, Rauch paid them a fee of a few thousand or forgave a debt, Glassman alleged.
It marks the second step in an FBI-led long-running investigation called ‘Operation Demolished Integrity.’
“Fraud is a crime,” Glassman said. “The essence of fraud is to trick people and get money that doesn’t belong to you and evade those things that are designed to make sure everything is on the up and up.”
This news outlet has reached out City of Dayton officials for comment on the investigation and indictments announced today but have not received a response.
UPDATE @ 1:50 p.m.:
Longtime Dayton businessman Steve Rauch today pleaded not guilty to seven counts in federal court this afternoon.
The counts included one charge of conspiracy to commit mail fraud and six counts of aiding and abetting mail fraud.
Federal investigators are expected to announce at 2:30 p.m. more details on the investigation and fraud charges.
We’ll continue to update this story as we learn more.
UPDATE @ 1:35 p.m.
Longtime Dayton demolition contractor Steve Rauch is in federal court today for an initial appearance.
He and his lawyer declined comment as they entered the courthouse after 1 p.m.
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It is unclear if Rauch’s appearance is directly connected with today’s news by the FBI about additional charges in an ongoing corruption probe.
FIRST REPORT:
The FBI and U.S. Department of Justice will announce fraud charges today for three people connected to a Dayton public corruption investigation, according to a release from the Department of Justice.
The news release does not make clear if the newest indictments are directly related to public corruption indictments announced in April by Interim Southern District U.S. Attorney Benjamin C. Glassman, Ohio Attorney General Dave Yost and FBI Assistant Special Agent in Charge Joe Deters, who is now Acting Special Agent in charge.
RELATED: Ex-Dayton commissioner, state lawmaker arrested; more arrests coming, feds say
At the time they said there would be more indictments in what Deters said “culture of corruption in Dayton-area politics.”
The men whose indictments were unsealed in April are former Dayton City Commissioner Joey D. Williams, now-fired Dayton city employee RoShawn Winburn, former State Rep. Clayton Luckie and businessman Brian Higgins.
RELATED: City investigating after corruption charges allege contracting fraud in Dayton
Winburn, 45, has pleaded not guilty to three counts of honest services wire fraud, two counts of corruptly soliciting a bribe and one count of making a false statement to the FBI. Winburn is a former Huber Heights council member and was business and technical assistance administrator for the city of Dayton’s Human Relations Council until he was fired after the indictment was announced. Winburn's trial is scheduled for Feb. 24.
RELATED: Dayton explains why fired worker’s business was linked to city office
On Sept. 27 former Dayton city commissioner Joey D. Williams pleaded guilty and was convicted of corruptly soliciting a bribe as part of a plea agreement with federal prosecutors. In a statement of facts filed with his plea, Williams admitted that as a commissioner he asked a business owner seeking city contracts to do work on his home at a substantially discounted price.
The unnamed business performed more than $35,000 in work on the Williams home. Williams contributed about $7,000 of his own money, the document says.
In return, Williams encouraged at least one city employee to find work for the business, the statement says.
He also voted to approve a contract between the city and the business without disclosing the “improper benefits” he had received, according to the statement.
Williams, 53, who in May left his job as Dayton market president of KeyBank, will be sentenced on Jan. 29.
RELATED: Ex-city Joey Williams pleads guilty, apologizes to ‘citizens of Dayton’
In July former state lawmaker Clayton Luckie, 56, pleaded guilty to one count of mail fraud related to defrauding the city’s minority business set-aside program, and faces sentencing on Nov. 15. Luckie admitted to accepting $2,000 in bribes as part of the scheme.
RELATED: Feds get guilty plea from former State Rep. Clayton Luckie, D-Dayton, in corruption investigation
Dayton businessman Brian Higgins, 48, was indicted on three counts of mail fraud and one of wire fraud for allegedly defrauding an insurance company in 2014 and 2015 with a claim involving a leaking fish tank that damaged his home.
Higgins, who formerly owned the defunct Sidebar 410 in the Oregon District and a livery service that hauled bodies for the Montgomery County coroner, pleaded not guilty and his trial is scheduled for Feb. 18
This is a developing story and we’ll update this page as we learn more.
The Dayton Daily News first broke the news about a federal investigation into corruption in Dayton. The newspaper will continue to dig into this important story to find out what’s really going on. If you have tips or any information on this investigation, please call or email Lynn Hulsey at 937-225-7455 or lynn.hulsey@cmg.com.