Missing Million of Quarters: Guilty!

Corea Sentenced to 7 Years in Prison

Attorney General Jeffrey S. Chiesa announced that John P. Corea, the former director of the Hoboken Parking Utility, was sentenced to state prison today for his role in the theft of $600,000 by a Toms River contractor whose company was hired by the City of Hoboken to collect coins from city parking meters. The contractor previously pleaded guilty.
Corea, 48, of Hoboken, was sentenced to seven years in state prison, including three years of parole ineligibility, by Superior Court Judge Francis R. Hodgson Jr. in Ocean County. He was ordered to pay $300,000 in restitution to the City of Hoboken and will be permanently barred from public employment in New Jersey. Corea pleaded guilty on Dec. 16, 2011 to a second-degree charge of official misconduct, which was contained in a 2009 state grand jury indictment. The indictment stemmed from an investigation by the Division of Criminal Justice and the New Jersey State Police.

“Government officials have a duty to act with complete honesty, integrity and care in dealing with public funds, but Corea corruptly betrayed that duty and the public’s trust, permitting a crooked contractor to literally make off with bags of cash belonging to the City of Hoboken,” said Attorney General Chiesa. “This lengthy prison sentence reflects a policy of zero tolerance when it comes to public officials who abuse their positions and break the law in New Jersey.”

“This was a very costly breach of public trust,” said Stephen J. Taylor, Director of the Division of Criminal Justice. “The Division of Criminal Justice will continue to work with the State Police and other agencies to expose and convict those who engage in official misconduct.”

Deputy Attorney General Jeffrey J. Manis prosecuted the case and handled the sentencing for the Division of Criminal Justice Corruption Bureau.

In pleading guilty, Corea admitted, among other things, that as director of the Hoboken Parking Utility, he steered three separate no-bid contracts to United Textile Fabricators to collect, count and manage the coins from the city’s parking meters. He admitted that he made false statements to the city council about the qualifications and experience of the company, which is a coin-operated arcade game manufacturer. He further admitted that he came to believe that United Textile and its owner, Brian A. Petaccio, 52, of Toms River, had stolen a substantial amount of the city’s parking revenues, but did not take any steps to stop the thefts or notify the city.

Petaccio pleaded guilty on Sept. 30, 2009 to an accusation charging him with second-degree theft by unlawful taking for stealing more than $1.1 million in coins from Hoboken’s parking meters between June 2005 and April 2008. He faces up to seven years in prison under his plea agreement and also must pay $300,000 in restitution to the City of Hoboken. After an audit in 2007 uncovered parking revenue shortfalls, Petaccio and his company returned approximately $575,000 to the city. However, Petaccio admitted, in pleading guilty, that he diverted an additional $600,000 that was not reported to the city. His sentencing is scheduled for April 20.

The investigation was conducted by Detective Sgt. Peter Layng of the State Police Official Corruption Bureau North Unit, Sgt. Lisa Shea of the Division of Criminal Justice Corruption Bureau, Deputy Attorney General Manis, Deputy Attorney General Perry Primavera and Administrative Analyst Kathleen Ratliff.

Jonh Corea pleads guilty to Official Misconduct

12/19/2011 Update:

Attorney General Paula T. Dow and Criminal Justice Director Stephen J. Taylor announced that John P. Corea, the former director of the Hoboken Parking Utility, has pleaded guilty to official misconduct for his role in the theft of $600,000 by a Toms River contractor whose company was hired by the City of Hoboken to collect coins from city parking meters.

According to Director Taylor, Corea, 47, of Hoboken, pleaded guilty on Friday afternoon (Dec. 16), to a second-degree charge of official misconduct before Superior Court Judge Francis R. Hodgson Jr. in Ocean County. The state will recommend under the plea agreement that Corea be sentenced to eight years in state prison, including three years of parole ineligibility. He must pay $300,000 in restitution to the City of Hoboken and will be permanently barred from public employment in New Jersey. The charge against Corea was contained in an indictment obtained as a result of an investigation by the Division of Criminal Justice and the New Jersey State Police.

“This defendant corruptly exploited his public office, at a high cost to the City of Hoboken,” said Attorney General Dow. “We are seeking a lengthy prison sentence for this flagrant betrayal of trust.”

“In this difficult fiscal climate, taxpayers need to have confidence that government officials will act as honest and vigilant stewards of all public revenues,” said Director Taylor. “We will continue to aggressively investigate and prosecute corrupt public officials such as Corea.”

Deputy Attorney General Jeffrey J. Manis took the guilty plea for the Division of Criminal Justice Corruption Bureau. Judge Hodgson will schedule Corea to be sentenced in February 2012.

In pleading guilty, Corea admitted, among other things, that, while director of the Hoboken Parking Utility, he steered three separate no-bid contracts to United Textile Fabricators to collect, count and manage the coins from the city’s parking meters. He admitted that he made false statements to the city council about the qualifications and experience of the company, which is a coin-operated arcade game manufacturer. He further admitted that he came to believe that United Textile and its owner, Brian A. Petaccio, 51, of Toms River, had stolen a substantial amount of the city’s parking revenues, but did not take any steps to stop the thefts or notify the city.

Petaccio pleaded guilty on Sept. 30, 2009 to an accusation charging him with second-degree theft by unlawful taking for stealing more than $1.1 million in coins from Hoboken’s parking meters between June 2005 and April 2008. Petaccio faces up to seven years in prison under his plea agreement and also must pay $300,000 in restitution to the City of Hoboken. After an audit in 2007 uncovered parking revenue shortfalls, Petaccio and his company returned approximately $575,000 to the city. However, Petaccio admitted, in pleading guilty, that he diverted an additional $600,000 that was not reported to the city. Petaccio will also be scheduled for sentencing in February 2012.

The case was prosecuted by Deputy Attorney General Jeffrey J. Manis of the Division of Criminal Justice Corruption Bureau. The investigation was conducted by Detective Peter Layng of the State Police Official Corruption Bureau North Unit and Sgt. Lisa Shea of the Division of Criminal Justice Corruption Bureau, with additional assistance from Deputy Attorney General Perry Primavera and Administrative Analyst Kathleen Ratliff, also of the Division of Criminal Justice Corruption Bureau.

12/11/2009 Update:

In a story you read on Hoboken411 first over TWO YEARS AGO – the “Missing Million” in quarters finally has a happy ending – with the indictments against those involved: Hoboken Parking Director John Corea, and Toms River contractor Brian A. Petaccio.

Read Indictment Here.

Missing Quarters case has a happy ending

hoboken-missing-quarters-case-solved-john-corea-indicted-anne-millgramFormer Director of Hoboken Parking Utility Charged with Conspiring with Contractor to Steal More than $600,000 in Parking Meter Funds from City of Hoboken
Contractor from Toms River pleaded guilty to stealing more than $1.1 million

“Attorney General Anne Milgram announced that John P. Corea, former director of the Hoboken Parking Utility, was indicted today on charges that he conspired to steal more than $600,000 in parking meter revenue that he allegedly split with a Toms River contractor whose company was hired by the City of Hoboken to collect coins from city parking meters.

According to Criminal Justice Director Deborah L. Gramiccioni, Corea, 45, of Hoboken, was indicted today by a state grand jury on charges of conspiracy (1st degree), financial facilitation of criminal activity (money laundering) (1st degree), official misconduct (2nd degree), theft by unlawful taking (2nd degree), and misapplication of government property (2nd degree).

The contractor, Brian A. Petaccio, 49, of Toms River, owner and president of United Textile Fabricators LLC of Toms River, pleaded guilty on Sept. 30 to an accusation charging him with second-degree theft by unlawful taking for stealing more than $1.1 million in coins from Hoboken’s parking meters.

Corea allegedly used his official position to steer three separate no-bid contracts to United Textile Fabricators in November 2005 to collect the coins, count and manage them, and maintain the city’s parking meters. United Textile Fabricators is a coin-operated arcade game manufacturer.

After an audit in 2007 uncovered parking revenue shortfalls, Petaccio and his company returned approximately $575,000 to the city. However, Petaccio admitted in pleading guilty that he conspired with an official of the City of Hoboken – whom he did not name in court but had previously identified to investigators – to divert an additional sum, in excess of $600,000, which was never reported to the city and which the two men split. It is alleged that Corea is the official who conspired with Petaccio and split the money with him.

“This is an outrageous abuse of public trust,” said Attorney General Milgram. “The indictment charges that Corea used his position as director of the Hoboken Parking Utility to conspire with Petaccio in the theft of more than $600,000 in parking meter revenue that should have been used for the benefit of the city and its residents.”

“Corea used his authority to steer three no-bid contracts to Petaccio, who admitted that he stole more than $1.1 million from the city, including funds in excess of $600,000 that he allegedly split with Corea,” Milgram added.

“Under his plea agreement, Petaccio must pay $300,000 in restitution to the city and faces up to seven years in state prison. He must cooperate in the ongoing investigation by the Division of Criminal Justice and the New Jersey State Police.

“Local governments and taxpayers are struggling enough in these hard economic times without having to bear the burden of officials and contractors who misappropriate public funds, as alleged here,” said Director Gramiccioni. “We have made cases such as this one a top priority.”

The case is being prosecuted by Deputy Attorneys General Jeffrey J. Manis and Perry Primavera of the Division of Criminal Justice Corruption Bureau. The investigation was conducted by Detective Peter Layng of the State Police Official Corruption Bureau North Unit and Sgt. Lisa Shea of the Division of Criminal Justice Corruption Bureau, with the assistance of Administrative Analyst Kathleen Ratliff, also of the Division of Criminal Justice Corruption Bureau. Deputy Attorney General Manis presented the matter to the state grand jury and took the guilty plea from Petaccio.

It is alleged that while Corea was director of the Hoboken Parking Utility, he improperly solicited Petaccio and United Textile Fabricators LLC and subsequently used his official position to assist the company in obtaining the three no-bid contracts. Each contract was for approximately $27,000 per year, just under the relevant statutory threshold at the time of $29,000, above which public bidding would have been required, allowing other companies to compete for the work.

Between June 2005 and April 2008, Corea allegedly conspired with the company to steal and launder more than $600,000 in parking meter revenues, while continuing to use his official position to assist United Textile Fabricators and conceal its illicit activities. The company’s contracts with the city were effectively terminated by April 2008.

The principal business of United Textile Fabricators is the manufacture, sale and leasing of arcade crane games, coin-operated machines with a crane-like claw that the player uses to try to grab a toy. The company installs its arcade machines in businesses throughout New Jersey, Pennsylvania and Delaware. The proceeds from the machines, which are shared with the company’s clients, are collected by company employees and transported to the company’s warehouse in Toms River where they are counted and bagged for deposit into the company’s main operating account at a local bank. The state’s investigation determined that coins from Hoboken’s parking meters were commingled with coins from the company’s arcade machines and deposited in one lump sum into the company’s operating account, concealing the source and ownership of the funds.

In pleading guilty before Superior Court Judge Francis R. Hodgson in Ocean County on Sept. 30, Petaccio admitted that he knowingly withheld from the City of Hoboken approximately $575,000 in parking meter revenues and misappropriated those public funds to pay a variety of personal expenses and business expenses unrelated to the company’s meter collection activities on behalf of the City of Hoboken. The state’s investigation determined that those personal expenses included credit card bills and car payments for a Porsche and a Mercedes. Petaccio and his company ultimately returned these funds to the city in several installments between October and December 2007, following an audit and inquiry by the city’s financial consultants and outside accountants.

However, it is alleged that, in addition to the $575,000 that Petaccio returned the city, he and Corea conspired to steal additional funds exceeding $600,000, which were never reported to the city. The two men allegedly worked out a scheme in which Petaccio reported to Corea the amount of coins collected each day, and Corea would tell him how much to put aside as the “take” to be split between them.

The first-degree money laundering charge carries a maximum sentence of 20 years in state prison and a fine of up to $500,000. Corea could also face a potential anti-money laundering penalty of up to three times the value of the property involved. Second-degree crimes carry a maximum sentence of 10 years in state prison and a $150,000 fine.

In addition, the official misconduct charge carries a mandatory minimum sentence of five years in prison without parole and a lifetime ban on any future public employment. Therefore, if Corea is convicted of both the first-degree money laundering charge and the second-degree official misconduct charge, he faces a mandatory minimum sentence of 15 years in prison without parole.

The indictment is merely an accusation and the defendant is presumed innocent until proven guilty. The indictment is posted with this press release at www.njpublicsafety.com.

The indictment was handed up to Superior Court Judge Pedro J. Jimenez Jr. in Mercer County, who assigned the case to Ocean County, where Corea will be ordered to appear in court at a later date to answer the charges.”

6/19/2008 Update:

State investigation underway

Hoboken411 can now confirm that a state investigation is underway into the Hoboken Parking Utility’s “missing million dollars” that was first mentioned here back on December 7, 2007. Outrageous rumors have been flying for days that state police investigators have taken HPU files and sought to talk with city officials. HPU Chief John Corea was uncharacteristically absent from last night’s City Council meeting, which ended when the council was called into private executive session to discuss (among other things) potential litigation with United Textile Fabricators.

As reported first back in April, UTF is the parking meter collections company with mob ties that Corea chose for the HPU. The city has so far confirmed that UTF owed Hoboken over $580,000 in parking meter revenue the company collected but did not send to the city. Others in the know say it is likely far more than that amount.

Read much more about UTF and the HPU below and after the jump.

4/9/2008 Update:

Missing Money at HPU

Parking meter collections company owner has history of mob ties

hoboken-parking-meters-1.jpgIn December of 2005, Hoboken awarded no-bid contracts to United Textile Fabricators of Toms River for parking meter coin collection and counting. The city’s FY2007 audit, performed by Garbarini & Co., noted that collections had decreased dramatically during the contract term with United.

In November of 2007, the City amended its meter coin collection procedures. United now collects from the meters and deposit directly into a depository in the name of the City of Hoboken Parking Utility. United had been previously taking the coins to their place of business in Toms River and depositing the funds in their accounts.

On December 4, 2007, the City engaged Garbarini & Co. to audit the books and records of United to determine the correct amount of meter collections not turned over to the City.

At the City Council budget hearing on December 6th, Councilman Michael Russo stated that it looked like a million dollars in revenue was missing from parking meter collections. At the December 19th meeting, a chastened Russo stated that his statement was in error and that he had made a miscalculation. (See transcript below)

Parking Utility Director John Corea asserted that an internal audit had found a negligible discrepancy and that an external firm (Garbarini, presumably?) would audit and confirm his findings. To the best of my knowledge, that audit report has not yet been made public. Despite Russo’s reversal and Corea’s assurances, a source suggests that monies were missing and that a few hundred thousand dollars will be returned to the city by United.

Here’s where it gets interesting: United Textile Fabricators, which manufactures a variety of arcade games (and administers our meter collections), is owned by Brian Petaccio, who plead guilty in 1991 to charges of racketeering in connection with an illegal gambling operation. Petaccio was then a director and vice-president of Grayhound Electronics, also in Toms River, which manufactured video gambling machines and was believed to be controlled by the Bruno-Scarfo crime family of Philadelphia. The family distributed illegal video slot and poker machines in New Jersey and Pennsylvania and was negotiating with crime families in New York, Nevada, and Massachusetts to market the machines nationwide. Also pleading guilty were Grayhound’s former chairman, Carmen J. Ricci, and Alan Cifelli, a representative of Grayhound’s distributor, B&C Enterprizes, and known associate in the Bruno-Scarfo family.

hoboken-parking-meter-arcade-crane-game.jpg

B&C would “market” Grayhound’s wares to bar and store owners willing to take the risk in return for the substantial revenue the machines would provide. Ricci, who was also Petaccio’s father-in-law, would often approach owners known to have financial difficulties, advance them some money, put in a few regular video games, and then replace them with the gambling machines if the owner was having trouble earning enough money to pay him back.

The owners of establishments with the illegal gaming machines would usually keep half the revenue. Cifelli would pick up the other half, taking it to the Grayhound offices. Half of that money would in turn be turned over as “tribute” to Nicodermo Scarfo, Jr., whose father, a former boss of the Bruno-Scarfo crime family, was serving a 55-year sentence for extortion, racketeering, and murder charges.

Petaccio now has his own company – http://www.unitedtextile.net – which has been collecting cash from our parking meters for the last two years. Draw your own conclusions. More to follow…

City Council Transcripts

December 6, 2007 City Council Meeting

Councilman Michael Russo: “Mr. England, I have one, uh, one other revenue source that, uh, has been called into question and – and some of my Council colleagues might know about it, some of them might not. Uh, it looks to, looks to me like there’s a million dollars missing in revenue from our collection in parking meters. This correct?”
Richard England, Business Administrator: “Umm…I don’t know at this point, Councilman.”
Russo: “I think we really need to look into it, uh, I don’t know if it was just not paid to us, I don’t know if it’s actually missing, I don’t know if there was a miscalculation, I have no idea what the circumstances are…”
Council President Theresa Castellano: “Needs to be looked into…”
Russo: “…but it’s my understanding that there, there’s something going on with that revenue stream. If we could get, uh, a look at it and find out so that you can report back to this council.”
England: “Let me check it out and I’ll get back to you as soon as I have an answer.”

December 19, 2007 City Council Meeting

Councilwoman Terry Labruno: “I actually want an answer – Mr. Corea can you answer that question about the million dollars that was alluded to at the last – at the last council meeting, about a million dollars being missing from meters?”
Parking Utility Director John Corea: “Yes, uh, uh, I believe that was, uh, talking about the parking, uh, the meter collections. We did an internal audit once we heard that and our internal audit has been complete and it shows a difference of thirty-four dollars and sixty-one cents. It is now being audited by an outside firm to be confirmed, uh, but we don’t see a problem as of right now.”
Russo: “And for the record, uh, that was an error in my calculation, so – when I asked the question, it was actually an error in my calculations when I was doing my own due diligence when it came to the budget, uh, so it was just a question and we clarified it…I was wrong.”

January 16, 2008 City Council Meeting

Hoboken Resident Maurice “Mo” Degenarro: “Is there a million dollars missing or isn’t there – was it a mistake – did they find it, or what? On the parking.”
Castellano: “Councilman Russo.”
Russo: “Thank you, Council President. Mo, the – the reason why I thought there was money missing was because I was going on past year’s, uh, anticipated revenues from the Parking Utility from the meters. Uh, it turned out that the meters did not generate as much money as they did in years past, so it was my mistake to think that that money was there when in fact it was not. That was the situation.”
Castellano: “It’s been cleared up.”

Lots of uhs, no?

12/7/2007:

hoboken-million-missing.jpgThird Ward Councilman Michael Russo dropped a bombshell during last night’s budget workshop meeting. The Budget and Finance committee chairman said there appears to be “a million dollars missing in the revenue from the collection from the parking meters.” He asked, “is this correct? It’s either not been paid to us, missng, or a miscalculation. Something is going on with that revenue stream.”

Hoboken Parking Utility Chief John Corea was not at the meeting to respond to the question. Business Administrator Dick England was there but did not respond to Russo’s query about the “missing million.” The change from the meters is apparently escorted by Corea to an out-of-town center where it is counted.

One million dollars is a lot of quarters!

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229 Comments on "Missing Million of Quarters: Guilty!"

Adam_C
Member
Adam_C

Regardless whether it’s old school or new school; The corrupt, manipulative public employees should be punished. I cannot wait to see what dirt is under the carpet of this administration, because I smell rotten fish from a long distance.

costume
Member
costume

Maybe the new munimeters on Washington Street will prevent this in the future. I noticed them for the first time today.

truth1
Member
truth1

Christie wants Hudson County. The new state atty. general Dow now has a great team to combat crime and corruption. All should be beware.

KenOn10
Member
KenOn10

“I am shocked, shocked to find that gambling is going on in here” (Capt. Renault)

People have been whispering not-so-softly about this for years. The optimist in me hopes that those observing this crime couldn’t go public because of the ongoing investigation… the pessimist in me wonders how many people observed this crime and looked the other way.

Sadly for Mr Corea, the current administration likely won’t allow him to “retire” with a “modest pension” to “avoid any more bad press about Hoboken”.

homeworld
Member

But I thought if we don’t like the stealing, we’re supposed to just move out.

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