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Defendant at the center of Cleveland, Ohio, water scandal convicted on all charges
WaterWebster.org Staff Report
October 8, 2008
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Oscar Wells, the former Supervisor of Pipe Repair for the Cleveland Water Division, and the man prosecutors said was at the center of two bribery schemes, was found guilty Oct. 3 by a jury on all five counts of a federal bribery and money laundering indictment.
Wells' conviction was the final case in the four-year corruption prosecution of 13 former Cleveland Water Division employes and contractors. Three of those convicted, incuding Wells, still must be sentenced.
"This is the end," Internal Revenue Service Criminal Investigations spokesman Gary Rasoletti told WaterWebster.org.
Wells, 58, was indicted on three charges of bribery, one count of conspiracy to commit bribery and one count of conspiracy to commit money laundering. A jury in the court of United States District Judge Solomon Oliver found him guilty on all counts.
A resident of Richmond Heights, Wells worked for the Water Division for more than 30 years before he retired about two years ago.
Two co-defendants, Jimmy Lee Gates, 50, the former Assistant Chief of Distribution of the Cleveland Water Division, and Liberator Noce, 66, owner of Noce Enterprises, Inc., pleaded guilty. Their sentencing is scheduled for Oct. 31.
The case was tried by Assistant United States Attorney Ann C. Rowland following investigation by the FBI, the IRS and the City of Cleveland Division of Police.
According to an IRS news release, Wells "was at the center of two bribery schemes." In the first, he demanded cash payments totaling approximately $35,000 to $40,000 from Noce in connection with Noce’s contracts to repair and replace fire hydrants for the Cleveland Water Division. The bribes were in exchange for Wells processing Noce’s invoices for payment, and in exchange for Wells giving Noce job orders under Noce’s contract with the water agency. In addition, Wells suggested that Noce inflate his invoices to the Cleveland Water Division to fund the bribe payments. The water agency paid Noce approximately $3.8 million during the period 2002 through 2004.
In the second scheme, Wells solicited and received two bribes in the amounts of $200 and $100 from a second hydrant contractor in 2004.
Gates, of Cleveland, the highest ranking Water Division official involved in the case, was an assistant chief who oversaw about 200 workers until he resigned. He had worked for the department for 26 years.
Noce, of Willoughby Hills, owns Libby Co. which had a contract with the city of Cleveland to maintain fire hydrants in the city and outlaying suburbs. The city paid Libby $3.2 million for its work from 2002 to 2004, according to an indictment. Gates was accused of splitting $40,000 in bribes from Noce with Wells in 2003.
A list of the three City of Cleveland Water Division employes and seven Water Division contractors who previously were convicted:
(1) Norman Gore, General Storekeeper at the Water Division, was convicted on April 25, 2005 and sentenced to 60 months incarceration. He was ordered to pay $1,337,597.20 restitution to the City of Cleveland;
(2) James Stallworth, Warehouse Manager at the Water Division, was convicted on November 18, 2004. Stallworth was sentenced to a 33 month term of imprisonment and ordered to pay $793,000 restitution to the City of Cleveland;
(3) Kenneth McNeil, Head Storekeeper at the Water Division, was convicted on November 17, 2004 and sentenced to 3 years probation. He was ordered to pay $10,000 in restitution to the City of Cleveland.
(4) Joseph B. Sturman, President and Owner of Victory White Metal Company, was convicted on November 22, 2004 and sentenced to 24 months incarceration, a $10,000 fine, and ordered to pay $1,156,853 restitution to the City of Cleveland. Sturman agreed to forfeit $584,705 in illegal proceeds;
(5) Samuel Petrony, Head of the Water Division at Victory White Metal Co., was convicted on November 29, 2004 and sentenced to 41 months incarceration and ordered to pay $1,949,853 restitution to the City of Cleveland;
(6) Arnold Kaufman, President of Woodhill Supply Co., was convicted on January 5, 2005 and was sentenced to 21 months incarceration and a $5,000 fine. Kaufman was ordered to pay $180,744.21 in restitution to the City of Cleveland, and Kaufman agreed to forfeit $90,372.10 in illegal proceeds;
(7) Michael Semlar, Salesperson at Woodhill Supply Co., was convicted on March 22, 2005. Semlar was sentenced to a 21 month term of imprisonment and ordered to pay the City of Cleveland $180,744.21 in restitution.
(8) Sebastian Morabito, Owner of Morabito Trucking, was convicted on January 25, 2007. Morabito was sentenced to a 24 month term of imprisonment and a $25,000 fine. He was ordered to pay the City of Cleveland $75,000 restitution.
(9) James Oppermann, Owner of Richmond Valve and Pipe, was convicted on April 10, 2007 and sentenced to 6 months home confinement without electronic monitoring and $37,000 in restitution to the City of Cleveland.
(10) Peter C. Zappola, a sales representative for a plumbing supply company, was convicted on June 8, 2007 and sentenced to imprisonment of 12 months and one day and restitution in the amount of $216,000 to the City of Cleveland.
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