Ex-commissioners, businessman begin trial on sweeping contract corruption charges By TIM FIELDS and MEGAN POINSKI Tuesday, February 12th 2008

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1 Ex-commissioners, businessman begin trial on sweeping contract corruption charges By TIM FIELDS and MEGAN POINSKI Tuesday, February 12th 2008 Daily News Photos by NICK SCHNEEMAN Former Property and Procurement Commissioner Marc Biggs at the entrance to the courthouse on Monday. Biggs is charged along with Dean Plaskett and Leroy Marchena in the contracts fraud scheme. ST. THOMAS - The trial of two former V.I. government commissioners and an influential businessman who are charged with fraud, bribery and conspiracy in a massive contracting scam opened Monday afternoon with resounding condemnations of government corruption and those who participate in it. Just who was involved in the scam, which swindled nearly $1.4 million from the

2 government through a web of contracts awarded to fake companies, is the topic at issue in the trial. U.S. Justice Department prosecutors contend that former Department of Planning and Natural Resources Commissioner Dean Plaskett and former Property and Procurement Commissioner Marc Biggs were at the helm of the scheme and received hundreds of thousands of dollars in kickbacks. They also believe that St. Thomas businessman Leroy Marchena worked with Plaskett and other conspirators to conceal the fraud from federal and local investigators, as well as reporters from The Virgin Islands Daily News. The contracting scheme was first exposed by two Daily News special reports, both called "Contracts and Cronies," published in Dean Plaskett, second from left, heads to District Court on Monday with his attorney, Gordon Rhea, third from left. The former Department of Planning and Natural Resources commissioner is charged in connection with a massive government contracting and kickback scheme. "This is a case about contracts, cronies and two corrupt commissioners," Justice Department attorney Armando Bonilla said in his opening statement. Attorneys for Plaskett, Biggs and Marchena agreed that a terrible scheme was perpetrated by government officials - but not by their clients. Defense attorneys told the jury panel that payoff conspiracy cost the government hundreds of thousands of dollars and left nothing to benefit the people of the Virgin Islands. They argued that other former high-ranking government officials - namely former

3 DPNR Environmental Protection Director Hollis Griffin and former DPNR Director of Building Permits Brent Blyden - were the ones who perpetrated it. Griffin and Blyden, as well as their co-conspirators Esmond Modeste and Earl Brewley, have pleaded guilty to charges stemming from the contracting scheme. All four have pledged to work with prosecutors and are likely to testify at the trial. "What you are going to see unfold from that box there is the manifestation of organized crime," said Marchena's attorney Charles Grant, gesturing toward the witness stand. "It is going to be paraded before you with several people who were involved. But all of them belong to Mr. Bonilla." The trial is the last chapter of a massive investigation that started in early just weeks after the publication of the first Daily News report. Agencies working on the federal probe included the Federal Bureau of Investigation, the U.S. Treasury Department's Internal Revenue Service Criminal Investigation Division, the U.S. Postal Inspection Service, the U.S. Environmental Protection Agency's Office of the Inspector General, the U.S. Attorney's Office in the Virgin Islands and the V.I. Inspector General. A federal grand jury was impaneled in March 2005 to investigate the matter, the indictment states. A 12-count indictment was handed up on Nov. 8. Biggs, Plaskett and Marchena face an array of charges including conspiracy to commit bribery through programs receiving federal funds, mail fraud, bribery through programs receiving federal funds, conspiracy to obstruct justice, obstruction of justice, and aiding and abetting. They have pleaded not guilty to all of the charges. On Monday, Bonilla painted a picture of government officials who put their own selfinterest before the welfare of the people, with at least eight contracts that were fraudulently awarded to companies whose most important qualification was a promise to pay off the officials. Most of the contracts involved in the scheme were in DPNR and handled by Plaskett and Griffin, according to prosecutors. Bonilla said that Plaskett took a large role in the scheme and demanded the biggest cut of the kickbacks. Bonilla said the scheme mostly involved a sham company called Elite Technical Services. - Elite got a contract for $87,980 in federal funds to conduct training and certification for the V.I. Hazardous Materials Team. - Elite got a $650,000 contract for varied projects under DPNR's Coastal Zone

4 Management division. DPNR also forced HOVENSA to let Elite review its plans for its $600 million coker plant in order to get necessary permits. To avert suspicion, Bonilla said, other contracts were given to another company - PubSafe Engineering Consultants - which was related to Elite and willing to give kickbacks. PubSafe got a $300,000 contract to review and write air quality permits to DPNR, but soon after was unwilling to continue giving kickbacks, Bonilla said. As a result, PubSafe lost a $110,000 contract to develop territorial landfill and incinerator guidelines, which was given to another startup sham company called C&R Environmental Design. Although all of these contracts were awarded and money was paid, very little work was actually done. In the case of the CZM projects, Bonilla said all that the territory received was "worthless progress reports." When Daily News reporters and investigators began asking questions about the contracts, Bonilla said, a cover-up scheme kicked into action and Plaskett enlisted Marchena's help. Since Marchena was already involved in a separate kickback scheme involving Blyden and Atlanta businessman Barry Bennett, Marchena helped hatch a scheme to protect his interests, Bonilla said. The schemes did not work, so Bonilla said that they came up with the strategy to blame everything on Griffin. Bonilla predicted that that strategy would continue throughout the trial. If Plaskett and Biggs were truly serving the public, Bonilla said, the contracting scandal would never have happened. "True public service is about honesty, integrity and self-sacrifice, all for the public good," Bonilla said. "This case is about arrogance, greed, abuse of power, and abuse of public trust." All three defense attorneys argued that Griffin was the mastermind behind the scheme. Plaskett's attorney Gordon Rhea called Griffin "the kingpin of the conspiracy." Treston Moore, representing Biggs, called Griffin an "admitted liar, a convicted felon. He takes crack and he's cheated on his loved ones."

5 Grant said that Griffin and his cronies, many hailing from Georgia, were "the Atlanta mafia." The only reason that there is a trial, defense attorneys said, was because the real criminals in this matter - who have already pleaded guilty to their crimes - gave investigators the names of people higher on the ladder than they were so they would receive reduced sentences. Moore said that as the government's chief contracting officer, Biggs was charged with approving all government contracts. His approval of contracts to Elite and related companies did not signify any participation in a scheme. Grant said that Marchena and Blyden were not in any sort of scheme together, and Bennett tried very hard to get Marchena to admit to things that he did not do. Marchena has been a confidante to V.I. governors, and his companies Cornerstone Business Consultants and Antillean Contractors have been successful, Grant said. That made Marchena a valuable prize to investigators, and resulted in this indictment. "There is not one statement, one syllable, in this indictment that says that Mr. Marchena accepted one red cent from anyone or gave a nickel to anyone else," Grant said. The trial continues today. - Contact Tim Fields at ext. 364 or tfields@dailynews.vi; contact Megan Poinski at ext. 304 or mpoinski@dailynews.vi.