Latest featured videos from Journal-News.com
August 2009 | Butler County News and Issues
 

Home > Blogs > Butler County News and Issues > Archives > 2009 > August

August 2009

GOP chairman profitted from headquarters sale

By Josh Sweigart | Monday, August 31, 2009, 02:58 PM

Butler County Republican party Chairman Tom Ellis personally profited roughly $25,500 from the sale of the party’s headquarters building in July.

This was the 3.5 percent commission Ellis, a licensed realtor, received as the real estate agent representing the buyer of the building. The same amount went to the selling agent, West Chester-based Northridge Realty, which Ellis had contracted to handle the sale.

“We did everything 100 percent legal,” said Northridge owner Dick Alderson. “Whether or not Tom Ellis is entitled to a commission, that’s something the party has to sort out.”

“Personally, had I been in the position, being executive director of the party, I probably wouldn’t have taken the commission,” Alderson said. “If the party was aware of his actions, I don’t think there was any impropriety.”

And Central Committee Chairwoman Judy Shelton said she was aware of the deal.

“I thought he deserved it,” she said. “Because of the fact that in these tough economic times, and real estate being off and him having the ability to secure a good buyer, I was really happy with that.”

Ellis said he found the buyer, showed the building, negotiated the price up $30,000 from the original offer, processed the sale and got part of the commission “just like any other realtor would have done.”

“The minute we sold it I was waving the party approximately $4,000 a month (in mortgage) just for having been fortunate enough and able to close the sale in a very difficult real estate market,” he said. “Some people have called (it) absolutely a miracle I was able to sell it like I did and for the amount of money I did.”

“I felt like I earned the commission,” he said.

The building sold on July 6 for $730,000, according to the Butler County Auditor’s Office Web site. The buyer is listed as Terra Investment Group Realty.

The sale came at a loss. The building cost more than $800,000 to build roughly four years ago and has a taxable value of $836,700, according to the auditor’s Web site.

The party decided to sell the building to save money. In a letter announcing the potential sale in May, Ellis said the party’s “future viability” depended on focusing money on political activities instead of bricks and mortar.

Permalink | Comments (7) | Post your comment | Categories: Republican Party

Butler County roundup - Tea Parties, trains and Jolivette

By Josh Sweigart | Monday, August 31, 2009, 10:18 AM

I’ve been lax the last few days in updating the blog. Apologies. Here is a sampling of what I’ve missed (on the blog, I mean. I didn’t miss the stories. I wrote them):

  • A story this Sunday explored the groundswell of grassroots movements starting locally, including Tea Parties and progressive PACs. This accompanying story outlines their first likely battle: Health care reform.
  • This story in today’s paper outlines the local Republican party’s endorsement process, coming up soon, and what it means for the race for county Commissioner Gregory Jolivette’s seat.
  • This story provides an update on the 3-C cross-state passenger train. Looks like both Hamilton and Middletown may be left out of the first phase.
  • And finally, some good news. Here is an inspirational story about Judy Good, who runs the food concession at the Government Services Center.

There have been a couple other things, but these are the big ones.

Any thoughts on any of this?

Permalink | Comments (1) | Post your comment |

Carpenter on why she should be county commissioner

By Josh Sweigart | Wednesday, August 26, 2009, 04:43 PM

Below is a summary of Butler County Clerk of Courts Cindy Carpenter’s comments to this paper’s editorial board this morning about why she should be county commissioner.

(Click on the top right corner to enlarge)

Carpenter Announce

Permalink | Comments (14) | Post your comment |

County commission agenda

By Josh Sweigart | Wednesday, August 26, 2009, 03:12 PM

Below is the agenda for Thursday’s Butler County commission meeting.

Anything look interesting to you?

(Click on the top right corner to enlarge)

County 082709

Permalink | Comments (1) | Post your comment | Categories: County Commission

Carpenter announces run for commission

By Josh Sweigart | Wednesday, August 26, 2009, 11:35 AM

Butler County Clerk of Courts Cindy Carpenter became the second local elected official today, Aug. 26, to announce a challenge to sitting county commissioner Gregory Jolivette.

Carpenter joins county Treasurer Nancy Nix in seeking the Republican party’s nomination for the seat currently held by Jolivette, also a Republican. Jolivette has come under political fire in recent weeks after the revalation he hired his son and daughter as county employees years ago.

Carpenter, who has served as clerk since 1997, said she was motivated to run for the seat after watching current commissioners — unable to work together — mishandle a budget crisis caused by national recession.

She said commissioners should cut their own budgets more before trying to mandate cuts to other officeholders, as they’ve done.

“I feel if we’re going to have a lecture on everyone tighten your belts, they could conceivably talk to themselves first,” Carpenter said.

And she doesn’t believe county offices will even stick to their new budget, which would mean this year’s shortfall could grow beyond $5 million.

“At the end of the year, we don’t’ stick to our budget here, we never have,” she said.

The increasingly crowded field of Republicans will fight for the county party’s endorsement this fall before the March primary. Carpenter said her long experience make her better qualified than Nix to make tough budget decisions and cut costs.

“I don’t think Nancy Nix would be the right commissioner for this time and place,” she said. “I would be better situated to make those decisions.”

Permalink | Comments (3) | Post your comment |

Ruscigno sentencing delayed

By Josh Sweigart | Tuesday, August 25, 2009, 10:22 AM

The sentencing date for Hamilton nightclub owner and former politico Joe Ruscigno has been pushed back to Jan. 6, 2010, federal court records show.

Ruscigo pleaded guilty in federal court to tax obstruction charges on April 29. In his guilty plea, he admitted to fudging the books of West Chester Twp.-based court reporting business Fitch Reporting Inc., to justify lowering weekly payments of back taxes to the IRS.

The sentencing date was scheduled for Aug. 25 after U.S. Judge Herman Weber moved the date from the original of Aug. 5 because that was Ruscigno’s wedding anniversary. Court records give no reason for the second sentencing delay.

The charges against him carry a maximum penalty of three years in prison, one year of supervised release, a $250,000 fine and a $100 assessment.

Permalink | Comments (2) | Post your comment | Categories: Butler County

County auditor resigns BMV in protest of fees

By Josh Sweigart | Monday, August 24, 2009, 01:19 PM

Press release from Butler County Auditor Roger Reynolds:

Packed away in this year’s tumultuous state budget discussions was Governor Ted Strickland’s decision to increase the fee on driver’s license renewals.

That decision was the straw that broke the proverbial camel’s back for Butler County Auditor Roger Reynolds, a strong conservative who is tired of seeing federal and state government mandate higher taxes on the citizens in his county. Auditor Reynolds has decided to resign as Deputy Registrar of the Hamilton West License Bureau in light of fee increases, and allow the state to bid out the contract for the location.

“My interest in government is deeply rooted in the belief that we need to decrease the tax burden on our citizens by reducing the size of government,” Auditor Reynolds stated in a letter to Carolyn Y. Williams, Acting Ohio Registrar. “Unfortunately, Governor Strickland has chosen to fund big government by signing into law a mandatory 25% fee increase on anyone requiring an Ohio driver’s license. I refuse to be a part of his decision to pass along big government tax increases in the form of higher license fees.”

The Auditor’s office has operated the West Side BMV for several years. Upon taking over the office, Auditor Reynolds significantly improved efficiency with better internal controls and management. Reynolds commits to working with the State License Bureau until and through the transition to a new Deputy Registrar.

Reynolds has cut hundreds of thousands of dollars from his own office budget over the past 15 months, and introduced budget transparency in Butler County with a web site location for taxpayers to see line-item office expenditures. During last year’s property tax evaluations, Reynolds contested state rules by refusing to take into account the higher value year into his reevaluation. This effort led to fairer assed property values during down economic times and provided county homeowners a break on their property taxes. Reynolds also hosted town meetings throughout the county to encourage property owners to challenge the state-mandated formula for the revaluation and look for value decreases to save money. These efforts have demonstrated Reynolds’ diligence in holding the line on government spending and tax increases.

“My decision to resign as Deputy Registrar hinges largely on the governor’s decision to increase taxes (fees) at a time when no citizen can afford such a tax increase,” Reynolds stated in his letter to the acting state registrar.

Permalink | Comments (6) | Post your comment | Categories: County Auditor

Tea Party meeting tonight

By Josh Sweigart | Monday, August 24, 2009, 07:30 AM

Press release from Liberty Twp. Tea Party:

The Liberty Township Tea Party holds their third local meeting at the Princeton Pike Church of God to an overflow crowd of nearly 200 people!

The newly formed Liberty Township Tea Party has held their third local meeting at the Princeton Pike Church of God on August 10, 2009. An overflow crowd of over 185 Liberty Township residents filled the room. Two speakers were on the agenda, Chris Littleton, one of the founders of the Cincinnati Tea Party organization spoke on the progress being made by that organization and of the upcoming events that are being planned. The second speaker was Ryan Day of Congressman John Boehner’s office who spoke on the process of contacting your local representative. Ryan described the process, how to effectively do it and what impact it had on the legislative process and the elective representative. The remainder of the meeting was devoted to a group discussion of the current health care initiative. Their next meeting is scheduled for the Princeton Pike Church of God at State Route 747 and Milliken Road on Monday August 24, 2009 at 7:00 PM.

The Liberty Township Tea Party is a grassroots, non-partisan, organization of private citizens united by our shared values and deep concern about excessive regulation and wasteful government spending.

We have three core beliefs: Fiscal Responsibility; Limited Government, and Free Markets.

We were founded in the summer of 2009 with a desire to organize with like-minded individuals; with an interest to educate ourselves, and others, about significant current events that are negatively impacting our country and families; and with a commitment to work in concert with other concerned citizens to bring about positive, public policies that are consistent with our core values.

What do you think of this new movement?

Permalink | Comments (0) | Post your comment |

Tea Party predicts massive turnout at VOA park

By Josh Sweigart | Saturday, August 22, 2009, 07:30 AM

Press release from the Cincinnati Tea Party (See details on the event below the list of invitees below):

The Cincinnati Tea Party has extended invitations to Ohio, Kentucky, and Indiana regional officials to attend what promises to be the largest Midwest tea party to date: the Voice of America Freedom Rally, September 5, from 1:00 p.m. to 6:00 p.m., at the Voice of America Park Museum in West Chester. The theme of the event will focus on average citizens becoming engaged in the political process and holding their representatives accountable.

The entire Congressional delegation, Senators, and governors from Ohio, Kentucky, and Indiana are invited to attend. In keeping with the theme of the event, some are also invited to accept town-hall questions rather than speak.

Invited to Answer Town-Hall Questions:

  • Speaker of the House Nancy Pelosi
  • House Minority Leader John Boehner
  • Governor Ted Strickland
  • Candidate for Governor John Kasich
  • Representative Geoff Davis
  • Representative Steve Driehaus
  • Representative Baron Hill
  • Representative Mike Pence
  • Representative Jean Schmidt
  • Representative Michael Turner

Invited to Attend - Ohio:

  • Representative Steve Austria
  • Representative John Boccieri
  • Senator Sherrod Brown
  • Representative Maria Fudge
  • Representative Jim Jordan
  • Representative Marcy Kaptur
  • Representative Mary Jo Kilroy
  • Representative Dennis Kucinich
  • Representative Steven LaTourette
  • Representative Bob Latta
  • Representative Tim Ryan
  • Representative Zack Space
  • Representative Betty Sutton
  • Representative Patrick Tiberi
  • Senator George Voinovich
  • Representative Charlie Wilson

Invited to Attend - Kentucky:

  • Governor Steve Beshear
  • Senator Jim Bunning
  • Representative Ben Chandler
  • Representative Brett Guthrie
  • Senator Mitch McConnell
  • Representative Harold Rogers
  • Representative Edward Whitfield
  • Representative John Yarmouth

Invited to Attend - Indiana:

  • Senator Evan Bayh
  • Representative Dan Burton
  • Representative Steve Buyer
  • Representative Andre Carson
  • Governor Mitch Daniels
  • Representative Joe Donnelly
  • Representative Brad Ellsworth
  • Senator Richard Lugar
  • Representative Mark Souder
  • Representative Peter Visclosky

Cincinnati Tea Party Founder and President Mike Wilson says he expects the turnout to be huge and explains the significance of the event. “For far too long, the average citizen has devoted limited attention to politics. As a result, the entrenched political elite of both parties have felt comfortable paying lip service to core American values, such as fiscal responsibility, limited government, and free markets, while spending like drunken sailors and infringing on our freedoms. The silent majority has finally awoken and their voice will be heard in West Chester on September 5.”

As it was during World War II, America’s voice will be heard on September 5 at the historical site of wartime broadcasts that were heard around the world. The United States intended the Voice of America to provide hope—the very first program in 1944 began, “We shall speak to you about America…” (Source: Ohio History Central, An Online Encyclopedia of Ohio History)

The rally is being presented by the Cincinnati Tea Party in partnership with the Cincinnati 9/12 Project, the Dayton Tea Party, the Ohio Liberty Council, and the Indiana Tea Party.

Location:

Front lawn of the Voice of America Park Museum

8070 Tylersville Rd.

West Chester, Ohio 45069

RSVP:

There have been 1,673 RSVPs as of August 20. To RSVP, go to http://cincinnatiteaparty.org/Events/voarally2009.htm.

About the Cincinnati Tea Party:

The Cincinnati Tea Party is a grassroots, nonpartisan group opposed to wasteful government spending. Our core values are fiscal responsibility, limited government, and free markets. Our goals include influencing elections for the betterment of America, promoting state sovereignty (Federalism), and compelling our elected officials to comply with the Constitution as written by our Founders. The Cincinnati Tea Party was founded by a group of lifelong Cincinnatians in February 2009. In April 2009, Community Tea Parties were launched to allow local leaders to spread the core values at the neighborhood level.

For Additional Information:

Cincinnati Tea Party: http://www.cincinnatiteaparty.org http://www.cincinnatiteaparty.org/>

Cincinnati 9/12 Project: http://www.Cincinnati912Project.com http://www.cincinnati912project.com/>

Dayton Tea Party: http://www.daytonohioteaparty.com/

Indiana Tea Party: http://www.indianapolisteaparty.com/

Ohio Liberty Council: http://www.ohiolibertycouncil.org http://www.ohiolibertycouncil.org/>

Permalink | Comments (12) | Post your comment |

Local politicians on Facebook

By Josh Sweigart | Friday, August 21, 2009, 03:26 PM

Want to be friends with a local politician? Now you can, with the click of a mouse.

As someone pointed out in the many comments on this story, (embattled) Butler County Commissioner Gregory Jolivette has a Facebook page.

His friends include state Reps. Courtney Combs and Tim Derickson. And he is apparently a fan of the state auditor and the Second Amendment (but not the First Amendment?).

I wonder who else from the local political landscape is into social networking?

Permalink | Comments (4) | Post your comment | Categories: Butler County

Jolivette promotes ‘Buying in Butler’

By Josh Sweigart | Thursday, August 20, 2009, 12:41 PM

Before people rush to shop at the new outlet mall in Warren County, Butler County Commissioner Gregory Jolivette wants them to think about the impact their purchase could have on local jobs and social services.

He wants local chambers of commerce to consider a “Buying in Butler” campaign to educate people that jobs and social services depend on where people shop.

“In these tough economic times, with our sales tax being the number one revenue source, we need to do everything we can to promote buying in Butler,” Jolivette said.

Sales tax revenues are down nearly 10 percent in the ongoing recession, forcing the county to explore cutting staff and services.

“Buying in Butler does two major things: retains jobs and helps maintain county services that our citizens expect and deserve,” Jolivette wrote in a letter asking local chamber leaders to meet and discuss a potential promotional campaign.

Permalink | Comments (7) | Post your comment |

County commission agenda

By Josh Sweigart | Wednesday, August 19, 2009, 05:10 PM

Below is the agenda for Thursday’s Butler County commission meeting.

Anything look interesting to you?

(Click on the top right corner to enlarge)

County 082009

Permalink | Comments (3) | Post your comment | Categories: County Commission

Nix on why she should be commissioner

By Josh Sweigart | Wednesday, August 19, 2009, 02:32 PM

Letter from Butler County Treasurer Nancy Nix to Republican party leadership. (Party endorsement hearings start in a few weeks for the county commission seat. Read about the incumbent’s problems here):

Dear Central and Executive Committee members:

On July 31, 2009, I announced my intention to seek your endorsement in the Butler County Commissioner’s race. It was not a decision I took lightly, knowing the many inherent risks in taking on an incumbent as a fairly new office holder during especially critical budgetary woes.

Yet, that is exactly why I am seeking endorsement. With my credentials as a former City Councilwoman and a certified public accountant, I transformed the Treasurer’s office into an efficient operation in just two years. I know I can help make the same positive difference and immediate impact as your Commissioner. It is time for a fresh, new approach to county government, and I am a newcomer offering integrity and change. As your Treasurer, I have:

· Reduced staff by 30% and budget by 18%, with absolutely no loss in quality of service
· Implemented an aggressive delinquent real estate tax collection referral process · Hosted state outreach programs to help struggling homeowners, people with credit issues, and senior citizens in need of money management · Bid out banking services, saving taxpayers tens of thousands of dollars · Maintained a solid, productive $230 million Butler County investment portfolio · Reduced my own pay by 5% last spring to help cut costs · Reduced tax valuations for tens of thousands of homeowners as a member of the Butler County Board of Revision

The Treasurer’s Office is now a highly functioning and competent team with cooperative relationships with other offices in the county. My office is on the right course, and I am ready to tackle an even greater responsibility. I believe in myself and my abilities, and know I have the education, political experience, leadership skills, and financial training to run the Commissioner’s office.

Education - I earned a Bachelor of Science in Accounting and Business in 1992 and passed the CPA exam on my first attempt.

Political Experience - During my four years as Middletown Councilwoman/Vice Mayor, we were forced to make severe cuts to our $27 million budget each and every year, including drastic and unpopular cuts to public safety services. We kept the budget balanced and the City solvent. Cuts to county budgets will continue to be necessary, and all departments must be treated fairly and consistently.

Leadership Skills -As a community leader, I’m chairing the 2009 Butler County United Way campaign and Public Affairs Committee of a Chamber of Commerce. I also chair the Butler County Board of Revision and the State’s County Treasurer Association Audit Committee. I have a wide network of contacts in Butler County due to my history of extensive community/public service.

· Financial Training - My work experiences are in both private and public sectors. As an accountant and banker, I have created budgets, produced financial statements, analyzed reports, processed loans, computed payroll, cost accounted, and directed inventory, among other things. Business practices are second nature to me and have served me well in the Treasurer’s Office.

As a two-year office holder, and unopposed Treasurer, I have raised more than $25,000 for my personal campaign. My family will contribute at a minimum - another $25,000 if I win your endorsement for the primary election. In addition, there are many other friends and supporters throughout the county who are on board with us.

I have contributed countless amounts of energy, time, and dollars to Republican candidates since becoming involved eight years ago. I’m a strong fiscal conservative and appreciate any consideration. Please feel free to reach me personally at 513-xxx-xxxx.

Thank you again for your consideration.

Sincerely,

Nancy Nix, CPA

Permalink | Comments (3) | Post your comment | Categories: County Commission, County Treasurer

Liberal groups call for state investigation of county practices

By Josh Sweigart | Wednesday, August 19, 2009, 11:43 AM

Press release from local liberal PACs:

The Ohio Attorney General was asked this week to appoint a Special Investigator to investigate impropriety and potential illegal activities in Butler County government.

In a letter signed by Jocelyn Bucaro (President of Change Butler PAC), William Gracie (Vice President of Butler County Progressive PAC), and Donna Mollaun (Founder of the Hamilton-Fairfield Democratic Alliance), Attorney General Richard Cordray was asked to direct a Special Investigator’s attention to two current issues: the awarding of contracts without competitive bids, and political influence on the appointment of relatives to the public payroll.

The letter to Cordray points out that Resolutions Community Solutions (of Hamilton) received more than $1.2 million for jail renovation work. Although state law requires that all public contracts with a value of more than $25,000 must be awarded via competitive bid, Butler County officials awarded that contract without bidding.

The letter also contains examples of officials using their influence to appoint relatives to county positions. In 2008, both the County Administrator and his wife resigned their jobs in the midst of a raise and retirement scandal. Now it appears that Commissioner Jolivette’s children were on the county payroll.

Officials of Change Butler PAC, Butler County Progressive PAC, and the Hamilton-Fairfield Democratic Alliance believe that Attorney General Cordray’s appointment of a Special Investigator is the only way to restore integrity and respect for the law in Butler County.

Permalink | Comments (9) | Post your comment |

Former Dynus owner guilty on all charges

By Josh Sweigart | Tuesday, August 18, 2009, 01:40 PM

Update: Here is the full story, with comments from the prosecution, on yesterday’s guilty verdict against former Dynus Corp. owner Orlando Carter.

Original post:

Former Dynus Corp. owner Orlando Carter was found guilty of all charges against him in federal court this afternoon, Aug. 18, including charges of bank fraud.

After a three week trial chock full of financial jargon and boxes of complicated evidence — pouring over 11 felony charges against Carter — it took a jury only a few hours to return the verdict.

“There, of course, will be an appeal,” said defense attorney Martin Pinales.

This ties Carter to a scheme that cost two banks and a prominent Cincinnati businessman millions of dollars along with fellow conspirators former company president Jim Smith, former Butler County Auditor Kay Rogers and former company employee Karin Verbruggen.

The three others have pleaded guilty for their role in the deal, which included Dynus taking out $6.5 million in illicit loans from National City Bank in Butler County’s name. All three are still awaiting sentencing more than a year after their guilty pleas.

Other charges against Carter included having company employees make a fake W-2 inflating his income more than $300,000 to get a loan for a $1.2 million Maineville mansion. And he is guilty of lying during bankruptcy proceedings to wipe out millions of dollars in debt owed to Fifth Third Bank.

The three week trial included testimony that Smith, with Verbruggen’s help, forged documents, bribed Rogers and took a “kickback” from West Chester Twp. Trustee George Lang — which Lang denies was a kickback.

Smith also testified that former county commissioner Michael Fox helped put pressure on National City to unhand the money, which Fox denies. And Smith said he worked with Lang and former GOP Executive Director Scott Owens to try to save the ill-fated deal.

Lang and Owens deny any wrong-doing, saying they were each paid more than $100,000 as legitimate professional lobbyists.

Fifth Third ultimately lost $4.3 million after the company collapsed in October 2005, bank executive testified. National City officials testified that bank lost another $6 million. Prominent Cincinnati businessman and civic leader Ross Love testified he lost $1 million he invested in Dynus and is on the hook for another $1.25 million company loan he guaranteed.

Permalink | Comments (6) | Post your comment | Categories: Dynus

Jury has a verdict in Dynus trial

By Josh Sweigart | Tuesday, August 18, 2009, 01:38 PM

I was just called back to federal court. The jury has a verdict in the trial of former Dynus Corp. owner Orlando Carter, I am told.

I am right now waiting for the jury to enter the room. Carter, attorneys and a small crowd of people are here.

Keep your browser here for the verdict.

Permalink | Comments (1) | Post your comment | Categories: Dynus

Motorcycle ride to benefit MRDD

By Josh Sweigart | Tuesday, August 18, 2009, 12:41 PM

Press release from Butler County MRDD:

The Butler County Board of MRDD (soon to be called the Butler County Board of Developmental Disabilities!) is hosting a Benefit Motorcycle Bike Ride on Saturday, August 22. The ride and after-party event takes place at the Tri-County Harley Davidson Store on Route 4 in Fairfield.

The ride begins at noon and the after-party runs from 1-4 p.m. We’ll have good food, great entertainment and some excellent raffle prizes. This is the third year running of this event and it’s always been a fun time! We see a good mix of bike riders, our own staff, community volunteers and individuals with developmental disabilities and their families.

We don’t require riders to pre-register so anyone can show up that morning (registration begins at 10 a.m., cost is $20 per rider) and they can be a part of the ride. We want to get the word out to attract more riders.

We are hoping to have a gathering of individuals and their families, as well as our staff, at our office located at 155 Donald Drive at around 12:00 p.m. that day. The bikers will be going past the office and we’ll cheer then on and thank them for participating.

Permalink | Comments (0) | Post your comment | Categories: Developmental Disabilities

Closing arguments: Rogers, Smith “bamboozled’ Dynus owner, others

By Josh Sweigart | Monday, August 17, 2009, 03:49 PM

“There’s a lot of smoke,” defense attorney Martin Pinales said about the charges against his client in federal court, “but there is no fire.

The prosecution fell short, Pinales said in his closing argument today, Aug. 17, in proving that former Dynus owner Orlando Carter was involved in schemes to defraud banks to get a home loan and $6.5 million in illicit loans in Butler County’s name.

So who was behind it? “Kay Rogers and Jim Smith got together and concocted something,” Pinales said.

Rogers, former county auditor, and Smith, former Dynus president, both pleaded guilty to bank fraud for their roles in the loans.

“Kay Rogers, an integral part of this case, was not brought in in this courtroom,” Pinales said. “If Kay Rogers had anything bad to say about Orlando Carter…if she corroborated, if she agreed with and told the same story that Jim Smith told, she would have been right there talking to you.”

In earlier testimony, Smith said Carter was intimately aware of the loans.

Pinales argued that the prosecution is making connections that don’t exist, then pumping the courtroom full of smoke — focusing on the grandeur of Carter’s house, the anger of a respected civic leader — to obscure the facts.

He portrayed Carter as yet another victim of Smith, along with banks that relied on his misrepresentations of business he brought into the company. It was Smith who forged a contract with West Chester Twp.; Smith who lied to county leaders about the existence of the loan; Smith who said he bribed Rogers.

“The missing in action Kay Rogers and Jim Smith the liar put this together and bamboozled the fifth largest financial institution in the nation (National City),” he said. “And Kay Rogers and Jim Smith bamboozled Orlando Carter.”

Because Carter believed the Butler County deal was legitimate — and so did others — he continued borrowing money from Fifth Third Bank that the bank lost when the company collapsed in October. 2005, Pinales said.

As for the phony home loan documents, Pinales said he instructed others to fill out the paperwork for him, and wasn’t aware they couldn’t be trusted to follow the law.

There is nothing, Pinales said, directly implicating Carter in any of the 11 charges against him that he pleaded not guilty to.

“That is why they brought in all of these other things to try to turn you against Orlando Carter, in an effort to cover up a lack of evidence,” Pinales said. “It is clear that the government has failed to prove their case beyond a reasonable doubt, and you must return a verdict of not guilty.”

Permalink | Comments (1) | Post your comment | Categories: Dynus

Closing arguments: Dynus owner ‘lied’

By Josh Sweigart | Monday, August 17, 2009, 01:50 PM

“He lied to you,” Assistant U.S. Attorney Jennfier Barry told a jury in federal court today, Aug. 17, about former Dynus. Corp. owner Orlando Carter.

“The evidence has exposed the truth about Orlando Carter and all his lies,” she said.

Barry’s closing arguments today come at the end of a three-week trial that included Carter taking the stand in his own defense for two days last week.

He testified he knew nothing of fake documents used to inflate his income so he could buy a $1.2 million mansion; fraudulent bank loans his company took out in Butler County’s name totaling $6.5 million; and false statements on his bankruptcy petition.

Barry characterized Carter’s defense as “an insult to (the jury’s) common sense,” and running contrary to the testimony of bank officials and company employees.

“It’s his house,” she said of Carter’s assertion that company employees filled out the fraudulent loan application. “They don’t live in the mansion, he lives in the mansion.”

Barry said Carter was fully aware company president Jim Smith — who Carter said kept him “in the dark” — was forging documents, hiring local politicians to “grease the skids” and promising National City Bank Dynus would return $4 million if it couldn’t secure proof of a non-existent deal with Butler County.

The $6.5 million the company borrowed from National City accounted for half of Dynus’ worth, she said. “This was the biggest deal for Dynus, the Butler County deal, and he claims to know nothing about it?”

In the meantime, she said, he was draining the company, spending $360,000 as a down payment for his home, renting a $180,000 suite at Paul Brown Stadium and going on a $10,000 Disney cruise.

“It (Dynus) was his personal piggy bank, and he was going to take every last penny,” she said.

As a result, National City, Fifth Third Bank and prominent Cincinnati businessman Ross Love all lost millions of dollars. And roughly 60 Dynus employees lost their jobs, “because they took the defendant at his word.”

“Where do the lies end? Right here. Right now. With you. Tell the defendant that his lies end with you, that you aren’t going to be victims of his fraud,” she said, asking them to find him guilty of an 11-count indictment.

Carter’s defense attorneys will make their closing arguments later this afternoon.

Permalink | Comments (0) | Post your comment | Categories: Dynus

Dixon: Financial storm’s a-brewin’

By Dave Greber | Monday, August 17, 2009, 08:30 AM

Just in time for hurricane season, Butler County commissioner Donald Dixon says there’s a Category 5 financial storm headed for county coffers.

And, a newly formed group of office holders, department heads and county business leaders (led by Dixon and Domestic Relations Judge Sharon Kennedy) say there’s no boards on the windows, no food or water rationed and no plan in place for clean-up once it blows through.

A story in Sunday’s paper profiled the group, as they work through plans they say are an effort to stave off financial ruin in Butler County.

An excerpt:

In a budget crisis, Butler County commissioners have two traditional choices: Enact sweeping cuts that could affect services, or use up cash reserves.

The latter option could leave them unable to cut payroll checks as early as the end of the first quarter and jeopardize their ability to borrow money for important projects, according to county finance officials.

But a newly formed group says there’s a third option: Drastic overhaul, cutting what they say is a budget that has grown bloated and unwieldy.

A national recession has — as with everyone else — brought the county to its financial knees. Revenues are down nearly $10 million — or approximately 10 percent of the county’s budget — from last year’s levels.

Officeholders are still struggling with nearly $2.6 million in cuts commissioners approved last month with a contentious 2-1 vote. Those cuts slashed the Board of Elections budget by 13.5 percent, and forced layoffs of sheriff’s deputies and court staff, among other areas.

The Budget Work Group, consisting of department heads, elected officials and county business leaders, says that was merely a stop-gap.

“That was taking a 2,000-pound grizzly bear and poking him in the eye with a stick,” said Commission President Donald Dixon, who voted against the July 16 cuts.

They want reform.

The story thus far has received a good deal of feedback, and Josh and I intend on addressing some of the questions posed in subsequent comments.

Here’s one, by “J.B.” on Aug. 16:

Just curious but who exactly is serving on this “work Group”? I think that’s an important thing the Journal needs to print or find out. I’m tired of only getting half of the story. I’m glad to see Mr. Dixon finally admitted he is in denial about budgets. That makes more sense when he votes to approve a half million in spending in December 2008 and then votes to kill the spending 7 months later. Denial would also explain why he would blame everyone else for this or is that projection?.

Response: As stated in the story, the group is made up of office holders, such as Clerk of Courts Cindy Carpenter, Treasurer Nancy Nix, Auditor Roger Reynolds, Dixon, Kennedy and others; department heads, such as Finance Director Bob Lowery, Budget and Management Director Pete Landrum and others; and area business leaders like Ed Dwyer from U.S. Bank.

These are public meetings. And if either of the other commissioners attend, the meeting would need to be publicized at least 24 hours in advance because of the existence of a quorum.

Another question from a reader:

Where does Dixon come up with some of these numbers and statements? Who’s in denial? It was the other two commissioners that made the $2.6 million in cuts, Dixon voted no, because it cut his girl friend’s budget 13.5 percent. Name some names Dixon, who is getting a 7% raise? The HJN should check these’s statements and numbers and call him on them before you publish them. You make it seem this nut knows what he is talking about.

Response: A sampling of previous stories about commissioners’ concern with automatic pay increases can be read here, here and here.

What other questions/comments do you have?

Permalink | Comments (2) | Post your comment |

Ohio Secretary of State to visit Oxford

By Josh Sweigart | Saturday, August 15, 2009, 09:00 AM

Press release from Butler County Progressive PAC:

Ohio Secretary of State Jennifer Brunner, a graduate of Miami University, returns to Oxford for a major speaking event sponsored by the Miami University College Democrats and the Oxford-based Butler County Progressive Political Action Committee.

Brunner speaks at 7 p.m. on Wednesday, August 26 at the LCNB Bank Building, 30 Park Place West, in uptown Oxford.

Brunner is a candidate for the Democratic nomination for the U.S. Senate seat being vacated by Republican George Voinovich. Ohio Lt. Governor Lee Fisher, also a candidate for the U.S. Senate, spoke to the Butler County Progressives and College Democrats in May.

Brunner graduated cum laude from Miami University as a sociology-gerontology major. She earned her J.D. with honors from Capital University in Columbus. She served for five years as a Judge of the Franklin County Court of Common Pleas,

Brunner was elected Secretary of State of Ohio in 2006. In 2008 she earned a Profiles in Courage Award for her reform of Ohio voting systems.

The Brunner address is co-sponsored by the Butler County Democratic Party, the Change Butler PAC, and the Hamilton-Fairfield Democratic Alliance.

“I look forward to returning to Butler County, the home of my alma mater, Miami University,” Brunner said. “Miami provided me with a first-class college education with experiences from working on an interdisciplinary study funded by the National Science Foundation to being a student caseworker for Mt. Auburn Family Services in Cincinnati with clients of my own.”

“I was the first in my family to complete my college degree, and that degree opened doors for me that were not open to my parents,” Brunner continued. “The tradition of excellence at Miami and Ohio’s other fine state and private higher education institutions propels students to excel in the global classroom and economy as they compete for 21st century jobs.”

Permalink | Comments (2) | Post your comment |

Animal shelter plans grand-opening celebration

By Josh Sweigart | Friday, August 14, 2009, 03:01 PM

Press release from Butler County:

The Animal Friends Humane Society (AFHS) will host a ribbon cutting and day-long celebration August 22 to mark the grand opening of the county’s new animal shelter. The event will run from 11 A.M. to 8 P.M. at the new AFHS facility at 1820 Princeton Road, Hamilton, Ohio.

The celebration, which is open to the whole community, will have a number of exciting events and activities to introduce you and your family to AFHS’s new facility.

The ribbon cutting ceremony starts at 11 A.M. and will feature county dignitaries and a host of four-legged friends. Special events will occur throughout the day including tours of the shelter. AFHS will be open from noon to 4:30 P.M. the day of the grand opening with both dogs and cats looking for new homes.

Listen for live broadcasts from The Rebel 105.9 FM from 10 A.M. - 1 P.M. After the day festivities, the evening will continue with “Girls Night Out.” More than 30 vendors will be on hand so women can shop and be entertained. Food, prizes, and raffles, which include numerous door prizes including a FAUX fur coat from Donna Salyers and a Dooney & Bourke Wristlet, will be available! This will be a great opportunity to have time with the girls and shop without the guilt, since all proceeds benefit the shelter! No reservations are necessary!

Animal Friends Humane Society is a nonprofit animal welfare organization that exists to enrich the communities it serves by promoting the well-being of animals. The Animal Friends Humane Society Pet Adoption Center is located at 1820 Princeton Road in Butler County. For more information call (513)867-5727 or visit www.animalfriendshs.org.

Permalink | Comments (6) | Post your comment | Categories: Dog Warden

Defense rests in Dynus trial

By Josh Sweigart | Thursday, August 13, 2009, 04:30 PM

The defense rested in the trial of former Dynus Corp. owner Orlando Carter this afternoon, Aug. 13, after hours of contentious cross-examination of Carter on the witness stand.

At the center of questioning was what Carter knew of $6.5 million in loans the company had taken out from National City Bank in Butler County’s name without county approval.

That bank lost millions of dollars on the deal, and Fifth Third Bank lost millions more when the company was later shut down. And former county auditor Kay Rogers, company president Jim Smith and a company employee pleaded guilty to bank fraud.

Carter testified today he knew nothing of it until shortly before the company’s collapse in October 2005.

Assistant U.S. Attorney Richard Chema pointed to a June 2005 meeting with National City officials and e-mails to Carter before and after the meeting concerning the bank loan.

Carter said the bank didn’t mention his company was on the hook for $4 million at the meeting. He said he was in a meeting in Chicago when the e-mails came, and didn’t read them when he came back.

“I probably had hundreds of e-mails when I got back,” Carter said.

“How many did you have from CEOs of major banks?” Chema asked.

“I don’t recall, sir,” Carter replied.

Carter said he also didn’t read an e-mail from Smith to Rogers that he was copied on asking Rogers to use her political clout to get county Prosecutor Robin Piper to sign a letter affirming that a deal existed between the company and county.

Smith had promised National City that he would get Piper to sign the letter or the company would give back a $4 million loan. Piper never signed, because a deal between the company and county didn’t exist.

Carter’s testimony runs contrary to bank and company officials, who have testified Carter knew about Smith’s guarantee to return the $4 million.

Carter said Smith lied in his testimony that Carter was in on the deal, and that Smith went out of his way to keep Carter “in the dark.”

Carter is fighting an 11-count indictment, including charges of bank fraud for his purported role in the Butler County deal, creating false documents to over-inflate his income for a home loan and lying on a bankruptcy petition.

Carter said he delegated the paperwork for the home loan to other people and was not aware they had made a fake W-2 to help him get the $1.2 million mansion. And he said he did not consider his answers on the bankruptcy petition to be false.

Defense attorney Wende Cross concluded her questioning by asking Carter pointedly if he intended to defraud the mortgage company, the banks, the bankruptcy trustee and others.

“No, ma’am,” he said after each entity was named.

The three week trial has included revelations about an alleged bribe given to Rogers, payments given to Smith by West Chester Twp. Trustee George Lang that Smith called a “kickback,” influence-peddling by prominent local Republicans and the alleged involvement of former county commissioner Michael Fox.

Closing arguments are scheduled for Monday, Aug. 17.

Permalink | Comments (7) | Post your comment | Categories: Dynus

Dynus scandal timeline

By Josh Sweigart | Thursday, August 13, 2009, 02:01 PM

With all the differing testimony in the trial of former Dynus Corp. owner Orlando Carter, and all the discussion about it outside the courtroom, I thought it might be useful to revisit the timeline of events leading up to Carter’s indictment.

Here it is (taken from story last year when Carter was indicted):

August 9, 2004: County Auditor Kay Rogers signs a mutual confidentiality agreement with Jim Smith, chief marketing officer of CBS Technologies, which later became Dynus Corp.

September 15, 2004: Rogers signs a declaration that Smith is a representative of the county. Extras

Dec. 31, 2004: Rogers signs a resolution at her home saying the county would borrow roughly $5.3 million from National City Bank for a fiber-optics deal with Dynus Global Communications. The resolution listed Rogers and Smith as representatives of the county.

Dec. 31, 2004: Rogers and County Commissioner Michael Fox have phone conversation with National City.

Jan. 12, 2005: A Dynus representative identified by the FBI as “JS” paid $9,500 to “HRH, a third-party intermediary company,” according to the FBI.

Jan 19, 2005: HRH pays $9,500 to Rogers.

Feb. 28, 2005: Smith meets with commissioners about planned project.

July 28, 2005: Commissioners approved an agreement with Dynus Corp., allowing the company to use four of the county’s fibers in exchange for the company luring new jobs and investment into the county.

August 26, 2005: Dynus’ line of credit with Fifth Third increased from $3 million to $7 million as a result of the Butler County contract.

Late August 2005: County receives invoice for lease agreements and discovers debt with National City.

Sept. 14, 2005: County administration meets with Dynus and National City officials, seeking a way to settle the dispute.

Sept. 16, 2005: Commissioners unanimously sever the economic development agreement.

Sept. 22, 2005: FBI begins investigation of potential bank fraud, other crimes.

Sept. 26, 2005: Rogers returns the $9,500 to HRH “in an effort to conceal the receipt of (the money),” according to the FBI. The money then went back to J.S.

October 6, 2005: Commissioner Charles Furmon says Rogers, Smith, West Chester Twp. Trustee and Dynus Financial President George Lang, County GOP Executive Director and Dynus Technologies Government Relations Director Scott Owens, Dynus CEO Orlando Carter, and officials from Fifth Third Bank met March 8, 2005 to discuss the debt.

October 11, 2005: Fifth Third gives Dynus three days to pay back $6 million because the Butler County contract is in question.

October 14, 2005: Fifth Third halts Dynus’ payroll, locks doors, and files suit for default in Hamilton County.

Nov. 10, 2005: Butler County files lawsuit against Dynus, National City to absolve debt. National City forgives debt.

February 2006: Dynus sues the county for $12 million, the value of the disputed contract with the county plus punitive damages.

March 29, 2006: Rogers does not disclose the receipt of $9,500 from J.S. or Dynus in her financial disclosure statement, according to federal officials.

September 2006: Dynus officials drop their lawsuit, saying they want to give the FBI investigation time to pan out.

September 2007: Dynus’ deadline to refile comes and goes as the FBI investigation trudges on.

Feb. 25, 2008: Court records are unsealed that includes County Auditor Kay Rogers’ guilty plea to bank and mail fraud, and tax evasion.

March 4, 2008: County Auditor Kay Rogers resigns amid pressure from state and local officials.

May 7, 2008: Federal officials release 11-charge indictment of Carter for charges including bank fraud, and release guilty pleas to bank fraud from Smith and Dynus projects manager Karin Verbruggen.

Permalink | Comments (2) | Post your comment | Categories: Dynus

Cross-examination of former Dynus owner continues

By Josh Sweigart | Thursday, August 13, 2009, 11:12 AM

Contentious cross-examination continued this morning, Aug. 13, of Orlando Carter, former Dynus Corp. owner standing trial in federal court on charges of bank fraud.

At the center of questioning was what Carter knew of $6.5 million in loans the company had taken out from National City Bank in Butler County’s name without county approval.

The bank lost millions of dollars on the deal. And former county auditor Kay Rogers, company president Jim Smith and a company employee pleaded guilty to bank fraud. Carter has testified he knew nothing of it until shortly before the company’s collapse in October 2005.

Assistant U.S. Attorney Richard Chema pointed to a June 2005 meeting with National City officials and a e-mails to Carter before and after the meeting concerning the bank loan.

Carter said the bank didn’t mention his company was on the hook for $4 million at the meeting. He said he was in a meeting in Chicago when the e-mails came, and didn’t read them when he came back.

“I probably had hundreds of e-mails when I got back,” Carter said.

“How many did you have from CEOs of major banks?” Chema asked.

“I don’t recall, sir,” Carter replied.

Carter said he also didn’t read an e-mail from Smith to Rogers that he was copied on asking Rogers to use her political clout to get county Prosecutor Robin Piper to sign a letter affirming that a deal existed between the company and county.

Smith had promised National City that he would get Piper to sign the letter or the company would give back a $4 million loan. Piper never signed.

Carter’s testimony runs contrary to bank and company officials, who have testified Carter knew about Smith’s guarantee to return the $4 million.

Carter is fighting an 11-count indictment, including charges of bank fraud.

Permalink | Comments (0) | Post your comment | Categories: Dynus

Auditor asks for some of county’s money back for jail renovation - The bill

By Josh Sweigart | Thursday, August 13, 2009, 09:47 AM

As a follow-up to the investigation I did of renovation of Butler County’s Court Street jail - which was overseen by Resolutions, Community Solutions with no bid or contract and architectural work appears to have been done before it was bid out - I have this story.

An excerpt (Go here for the full story):

The nonprofit Resolutions Community Solutions Inc. overbilled Butler County $24,266 for overseeing renovations of the county’s Court Street jail, according to an analysis by Auditor Roger Reynolds.

After a Cox Publishing investigation of the project — in which Resolutions oversaw jail renovation in 2006 and 2007 with no bidding and little county oversight — Reynolds reviewed the invoices.

He found bad math and duplicate invoices cost the county $24,266. Reynolds sent Resolutions a bill that was paid in little more than a week, he said.

“Once we became aware of it and he sent us the documents, we corrected it,” said Resolutions Vice President Steve Best.

On one invoice, the agency billed the county $111,925 with backup documentation attached that added up to $105,299. The invoice also included subcontractor invoices billed twice, including a $9,700 payment to Johnstone Supply.

Another invoice had the same problems. The county paid $267,195 while backup documents added up to $264,551. Duplicate payments to three companies added up to $7,924.

“They look like common errors from what I saw,” Reynolds said. “But more importantly, what I saw was a lack of internal controls on the part of the previous auditor and the administration.”

Here is the letter from Reynolds to Resolutions describing the billing errors (Ignore the fax cover page, that’s from when I requested the letter):

(Click on the top right corner to enlarge)

ResoFoloLetter

What do you think?

Permalink | Comments (2) | Post your comment | Categories: Resolutions

Carter on illicit loans: ‘I did not know about it’

By Josh Sweigart | Thursday, August 13, 2009, 09:11 AM

Update: Go here for the story on yesterday’s testimony that ran in today’s paper. It includes comments from readers.

Original post:

Former Dynus Corp. owner Orlando Carter again took the stand in his own defense in federal court this morning, Aug. 12, disputing testimony made by bank officials and former company employees.

Those people said Carter was involved in hiding the details of a loan with National City Bank that the company took out in Butler County’s name without county approval.

That is part of the 11-count indictment against Carter.

Carter said he knew National City was trying to get the county to sign an opinion of counsel letter to confirm a deal with the county. But he said he didn’t know company president Jim Smith was signing documents on behalf of the county and company to borrow money.

Throughout running the company, an outside audit required by Fifth Third Bank and even a meeting with National City Bank, Carter said he never became aware that his company was on the hook for $4 million.

“Dynus never was a part of the financing as it relates to National City and Butler County,” Carter said. “There was never a resolution that came to me. There was never any paperwork given to me by National City that said you’re financing a project for Butler County.”

“One of my employees made a commitment that he would help get an opinion of counsel, but the opinion of counsel was between National City and Butler County, not Dynus.”

The deal with Butler County involved letting the company use the county’s fiber optic ring in an economic development agreement. But county officials pulled out when they learned of the illicit loan.

The company collapsed in 2005 after Fifth Third pulled out a line of credit for the company that was based on the now-defunct deal. Fifth Third officials said they would not have extended the line of credit if they knew about the National City loan, and that Carter hid that information from them during an audit.

Defense attorney Wende Cross asked Carter if he told auditors that the company was on the hook for $4 million, and that National City was asking for the money back because the opinion of counsel never materialized.

Carter answered both questions the same way: “I did not know about it.”

Fallout from the company’s collapse spread to the upper branches of county government, with then-auditor Kay Rogers pleading guilty to bank fraud and later resigning for her role in the deal.

Smith also pleaded guilty to bank fraud, as well as another former Dynus employee.

Permalink | Comments (2) | Post your comment | Categories: Dynus

Former Dynus owner denies allegations

By Josh Sweigart | Tuesday, August 11, 2009, 02:07 PM

Update: Orlando Carter denied any role in making a fake W-2 and other documents used to over-inflate his income by more than $300,000 to get a mortgage on a $1.2 million mansion.

He said he delegated the mortgage process to Dynus employees Damian Ortiz and Julia Light, and hadn’t seen the fake tax records until the trial.

“What was your involvement?” asked defense attorney Wende Cross.

“I had none,” Carter replied.

As to claims by part-owner of Dynus Ross Love that taking this money from the company was “stealing,” Carter said his agreement with Love allowed him occasional disbursements based on his 75 percent ownership of the company.

Carter is fighting an 11-count indictment. In addition to charges of lying on his loan application, Carter is charged with bank fraud for his alleged role in Dynus securing $6.5 million in bank loans in Butler County’s name without county approval.

Original post:

Former Dynus Corp. owner Orlando Carter took the stand in his own defense today, Aug. 11.

Before buying the company at the center of a scandal that cost two banks millions of dollars, unseated a Butler County auditor and left 60 people without jobs, Carter grew up on a North Carolina farm.

They raised corn, cucumbers and tobacco, he said. “Every morning we would have to get up before we went to school and take care of the chores on the farm,” he said.

After earning an MBA from Duke University in 1995, Carter worked his way up through several companies before he bought a fiber-optics company then called Optical Data Comm in 2001. The companies had hundreds of employees at the time and $160 million in sales, he said.

The market soon collapsed, Carter said, and he led the company through a bankruptcy reorganization.

“We came out as a stronger company (with) a lot stronger balance sheet,” he said. He then ran the company for three years before it merged with North American Interconnect.

In 2003, his marriage on the skids from traveling too much, Carter decided to buy the Cincinnati company that would later become Dynus Corp.

He is now talking about how he met Ross Love, and the role Love played in the company.

Permalink | Comments (5) | Post your comment | Categories: Dynus

West Chester trustee disputes ‘kickback’ was paid

By Josh Sweigart | Tuesday, August 11, 2009, 09:39 AM

The question assistant U.S. Attorney Jennifer Barry tried to ask West Chester Twp. Trustee George Lang in federal court today, Aug. 11: “Isn’t it true, Mr. Lang, that Orlando Carter was paying you to grease the skids for him at Butler County?”

The question the judge would allow: “Isn’t it true that Orlando Carter was paying you over $300,000 to make introductions for him at Butler County for the benefit of his company.”

“Yes, among other things I did for that organization, yes,” Lang replied.

Lang was called to the stand by defense attorneys for Carter, former owner of Dynus Corp.

As the company was taking out $6.5 million in loans in Butler County’s name without county approval, Lang said Dynus contracted with him to help secure a fiber optic contract with the county.

The fraudulent loans ultimately caused the company’s collapse in 2005 and felony charges against company executives.

Lang said he introduced Dynus officials to Kay Rogers, then county auditor. Rogers was in charge of the county’s information technology division, he said, so it made sense for her to be involved.

Rogers would later plead guilty to bank fraud for her role in securing the loans.

Dynus paid Lang’s company $360,000 for introducing company and county officials, $100,000 of which went each to company president Jim Smith and then Butler County GOP executive director Scott Owens.

Testimony this morning focused on the payments given to Smith. There were two checks, one for $20,000 paid to Smith’s girlfriend and another for $80,000 that Smith had said he used to build a pool.

In earlier testimony, Smith referred to the payment he received as a “kickback,” because he was a Dynus employee getting paid by a contractor for the company.

But Lang said he was unaware Smith was a Dynus employee when he was working as a consultant for Lang. He even gave Smith tax forms accounting for the payments.

“Did you give Mr. Smith a kickback?” asked defense attorney Martin Pinales.

“No,” replied Lang.

“Was it under the table in any way?” Pinales asked.

“No it was not,” Lang said.

Lang said he would not have given Smith the money if he knew he was working for the county. But he said he did tell Carter about the payments.

Lang’s company later merged with Dynus Financial, where Lang served as president. As a company employee, he used the company’s suite on the 50-yard-line of Paul Brown Stadium and was reimbursed for meals at Jags, where he was part owner.

Lang said he had met Smith when his company, the Lang Agency, was trying to get a employee benefits contract with Reynolds and Reynolds, where Smith worked. When Smith came to him with the Dynus proposal, Lang said, he was excited about it.

“Dynus, I still believe to this day, was sitting on something really big, and something that could change the world,” Lang said.

Lang said the county and company did enter into an economic development agreement, but it fell apart when news surfaced of the fraudulent loan.

Carter is fighting an 11-count indictment, including charges of bank fraud stemming from the loan.

Smith has pleaded guilty fraud, as well as another former company employee.

Permalink | Comments (3) | Post your comment | Categories: Dynus

Dynus, Jolivette and ‘Little Chicago’

By Josh Sweigart | Monday, August 10, 2009, 10:59 AM

In case you missed it, we had a wrap-up this weekend of two of the biggest talks of the town in Butler County this week: Accusations of nepotism against Commissioner Gregory Jolivette and the ongoing Dynus trial.

First, we had this intro:

Butler County is doing more than its share these days to keep the FBI and Ohio Ethics Commission busy.

Two of the county’s three commissioners are under investigation by the ethics commission on accusations of nepotism.

The most recent subject is Commissioner Gregory Jolivette, who admits to voting on the hiring of and pay for both his son and daughter as county employees in 2004 through 2006.

The investigation of Commissioner Charles Furmon and former County Administrator Derek Conklin is still ongoing. They are being examined to learn what role, if any, they played in pay raises given to Furmon’s son-in-law and Conklin’s wife.

That investigation has already taken more than a year.

Then there’s the federal Dynus Corp. trial, which has sent skeletons tumbling out of the county’s closet.

This was the second week of the federal trial of Orlando Carter, the former fiber optics firm’s owner, in U.S. District Court in Cincinnati. He has pleaded not guilty to an 11-count indictment that includes charges of bank fraud.

So far, Carter has been a minor player the stories about his trial, eclipsed by allegations of bribery, fraud and political influence for sale.

It was known that former county auditor Kay Rogers played a role in Dynus taking out a multimillion dollar loan in the county’s name when she pleaded guilty to bank fraud.

But what emerged from the testimony by former Dynus president Jim Smith were claims that he bribed Rogers and worked in collaboration with former commissioner Michael Fox to get the job done behind others’ backs.

Fox denies any wrongdoing, calling Smith a liar. Others implicated in the trial — including Scott Owens, former executive director of the county Republican Party, and West Chester Twp. Trustee George Lang — said they were lawfully hired by the company for a job.

That job was using their political influence to help the company land a contract with the county.

As the trial continues and a re-election race nears for Jolivette, continued hard-nosed politics and mounting scandals could put a new twist on the county seat’s old nickname — “Little Chicago.”

Two stories accompanied in Sunday’s paper.

Dave Greber followed with this story about Jolivette’s political future. Excerpt:

Accusations that Butler County Commissioner Gregory Jolivette engaged in nepotism seems to be making him vulnerable to prospective candidates of his seat.

Since allegations surfaced two weeks ago that Jolivette voted on resolutions having to do with his son’s and daughter’s county employment, three people have taken out petitions to run against him next year.

Jolivette said he will run to keep his seat on the commission.

As of Friday, Aug. 7, petitions had been pulled by County Treasurer Nancy Nix, Hamilton resident Bob Weber and a yet-to-be named candidate whose petition was picked up by the executive assistant to Clerk of Courts Cindy Carpenter.

Carpenter said last week there were no announcements coming from her office, although she is considering running and has been in contact with members of the county’s Republican Party.

On Thursday, July 30, Jolivette admitted to moving and voting on a resolution in 2005 to hire his son, Kevin, for a job with the county’s summer work program. He said former county Administrator Derek Conklin — who has declined to comment on the issue — advised him doing so would not be a problem. And when the resolution was read during the May 13, 2005, meeting — by title only — Jolivette says he never noticed it included his son’s name.

The next day, it was determined that Jolivette also voted on several resolutions over a three-year period involving the hiring and pay of his daughter, Elizabeth, who was employed with the county’s Department of Job and Family Services in 2004, 2005 and 2006.

And I wrote this story with reactions to testimony at the Dynus trial from Michael Fox. Scott Owens and others mentioned in court. Excerpt:

A bribed county auditor. A county commissioner engaged in back room deals. A local GOP leader hired to grease the wheels on an illicit deal. A township trustee giving a kickback to a company executive for business he received.

These were all allegations leveled last week in the federal court trial of former Dynus Corp. owner Orlando Carter in U.S. District Court in Cincinnati.

The trial has shed light on some dark corners of Butler County, and drawn ire from a public growing weary of scandal.

County officials said this is not how business is supposed to work. Some denied the accusations and implications made in court. Others refused to comment.

Read the stories, then come back here and tell us what you think.

Permalink | Comments (21) | Post your comment |

Love says former Dynus owner was ‘stealing’ from company

By Josh Sweigart | Monday, August 10, 2009, 09:42 AM

Prominent Cincinnati businessman and civic leader Ross Love shook his head incredulously as a prosecuting attorney read a list of expenses former Dynus Corp. president Orlando Carter racked up with company money.

$360,000 for a down payment for a Maineville mansion. $10,000 for a family vacation to Disney World. Roughly $180,000 for a box seat on the 50-yard-line of Paul Brown Stadium.

“I characterize that as stealing money from the company. That’s just wrong,” Love said.

Love, one of the wealthiest men in Cincinnati, had 20 percent ownership of Dynus Corp. after investing $1 million in the company’s start-up and guaranteeing a $1.25 million loan.

Love said his agreement with Carter capped the company owner’s salary at $100,000. Love said he knew nothing of the other things Carter paid for.

The $1 million is gone, Love said. And he is still paying off the $1.25 million.

Dynus closed its doors in October 2005, after it came to light the company had borrowed $6.5 million in Butler County’s name without county approval.

Carter is fighting an 11-count indictment, including charges of bank fraud and over-inflating his income to qualify for a home loan. Love’s testimony came Monday, Aug. 10, on the 11th day of Carter’s trial in federal court.

Defense attorneys counter that Carter was in the dark about the details of the Butler County deal — that it was being handled by company president Jim Smith — and he thought the company, and his salary, were more profitable than they were.

Prosecuting Attorney Jennifer Barry asked Love what he would have said if Carter had approached him as member of the company board about these expenses.

“It’s so out of bounds that it would not have been a discussion, and it would have led to a rethinking of his leadership in the company,” Love said.

Permalink | Comments (2) | Post your comment | Categories: Dynus

Love lost $1 million in Dynus collapse

By Josh Sweigart | Friday, August 7, 2009, 04:37 PM

Prominent Cincinnati businessman and civic leader Ross Love added his name this afternoon, Aug. 7, to the list of individuals who lost millions of dollars in Dynus Corp.

Love said he met Carter at a Christmas party in December 2003 and was impressed by the young, black Duke University graduate with a business plan to turn a struggling phone resale business into a telecom powerhouse.

“He had detailed projections that showed the business growing in the range of $30 million in sales over 5 years,” Love said.

So he invested $1 million, which he lost when the company collapsed in late 2005.

Love was formerly vice president of P&G’s advertising division who became one of the wealthiest men in the state with the 2001 sale of a string of radio stations for $200 million.

Permalink | Comments (1) | Post your comment | Categories: Dynus

Fifth Third Bank lost $4.3 million in Dynus scandal

By Josh Sweigart | Friday, August 7, 2009, 11:49 AM

A Fifth Third Bank official testified this morning on how his bank relied on purported business deals that didn’t exist to loan Dynus Corp. $13.8 million in 2004 and 2005.

Fifth Third employee David Hummel testified that Dynus owner Orlando Carter personally applied for the loans and lines of credit, including $5 million to purchase the company’s Bond Hill headquarters.

Carter also had help from prominent Cincinnati businessman Ross Love, who lost more than $1 million invested in Dynus.

Carter has pleaded not guilty to an 11-count indictment, including charges of bank fraud.

The Fifth Third loan applications signed by Carter included representations that the company had lucrative contracts with Butler County, West Chester Twp. Greensboro, Ala., and Robins Air Force Base in Georgia.

In fact, the company’s contracts with these agencies were pending at best. And former company president Jim Smith has testified that some of the contracts were actually based on forgery or fraud.

“We were led to believe it was a done deal,” Hummel said.

The application also did not include the fact that the company had borrowed $6.5 million from National City Bank in Butler County’s name without county approval.

The Fifth Third line of credit was for the operation of Dynus, and came with the stipulation that Carter not be paid more than $200,000, Hummel said.

He said he was unaware Carter had used $312,000 of the company’s money to purchase a $1.2 million mansion, spent $170,000 for a box seat on the 50-yard line of Paul Brown Stadium and Smith spent $1,366 of company money at a Hustler strip club in New Orleans.

“What happened to all these loans?” asked Assistant U.S. Attorney Richard Chema.

“We were not paid back,” Hummel replied.

“How much money has the bank lost,” Chema then asked.

“$4.3 million,” Hummel said.

The bank has a $5.6 million judgment against Carter that he is trying to have cleared through bankruptcy, Hummel said.

Permalink | Comments (0) | Post your comment | Categories: Dynus

Butler County budget update

By Josh Sweigart | Friday, August 7, 2009, 09:17 AM

Fellow reporter Rich Wilson is picking up my slack covering Butler County while I’m in court in Cincinnati for the Dynus trial. Wilson filed two stories yesterday.

This story outlines the county’s plan to furlough employees and encourage more furloughs to make up a budget gap. Excerpt:

Some Butler County employees not part of a collective bargaining unit will be forced to take unpaid days off to make up for lost revenue during the recession.

Butler County commissioners unanimously approved a measure Thursday night, Aug. 6, that uses furlough days in the departments that fall under the commission’s purview.

The Cost Savings Plan will reduce general fund expenses by an estimated $100,000, said county Administrator Tim Williams. The policy mandates 10 furlough days this year for 25 to 30 employees in the commissioners’ office, personnel and records offices and information services, Williams said.

Commissioners also agreed the measure should include an amendment to encourage county officeholders to implement furlough days for their employees to achieve requested budget cuts.

About $1.6 million would be cut out of the budget if the policy is implemented countywide in all general fund departments, Williams said.

In this story, Butler County Board of Elections officials are trying to figure out how to deal with a 13.5 percent budget cut handed down by commissioners. Excerpt:

Elections officials are waiting to decide where to make heavy cuts to an already lean budget.

The Butler County Board of Elections met Thursday afternoon, Aug. 6, with county Finance Director Pete Landrum to go over the latest financial projections for the elections office.

With tax revenue significantly down, county commissioners have opted to return several departments to 2007 funding levels. For the elections office, that translates to a 13.5 percent overall cut, or $332,990, from its $2.8 million budget.

“The bottom line is the county is in a hole,” Landrum said. “The big thing right now is to move forward.”

If implemented, the elections office will have cut its 2009 budget from what was originally requested in December 2008 by 40.5 percent, according to BOE Director Betty McGary.

McGary said commissioners should have worked closer with her office before deciding how much to cut from its budget.

Any thoughts on either of these issues?

Permalink | Comments (2) | Post your comment |

Fiance testifies in Dynus trial

By Josh Sweigart | Thursday, August 6, 2009, 02:56 PM

Michelle Castellanos’ voice quivered Thursday, Aug. 6, as she testified in the federal court trial of her fiance, former Dynus Corp. owner Orlando Carter.

Prosecutors asked her about the months immediately before and after the collapse of Dynus, when Carter is alleged to have lied during a petition to eliminate more than $13 million in company and personal debt.

Carter has pleaded not guilty to an 11-count indictment. This includes charges of bankruptcy fraud, which dominated testimony in the trial Thursday.

Other charges are that Carter was part of a scheme that involved bribery, forgeries and taking out millions of dollars in loans in Butler County’s name without county approval. When the deal came to light, Dynus collapsed.

Carter is accused of using Castellanos’ bank account to funnel rental income checks and tax refunds during bankruptcy. Prosecutors produced a copy of a check written from her account with her name on it.

“Whose handwriting is on that check?” asked assistant U.S. Attorney Richard Chema.

“It is not my handwriting,” Castellanos replied.

“Do you recognize the handwriting?” Chema asked.

“It’s Orlando Carter’s,” she said.

Prosecutors also pointed out that Castellanos had invoiced Dynus $43,000 and was paid one week before the company folded for work she said she had done over several months.

On cross examination, Castellanos said she had legitimately worked for Dynus as a professional recruiter. And she said she did what anyone else would do if their fiance couldn’t open a checking account because of money trouble: let him use hers and sign checks with her knowledge.

“Would you lie to protect Mr. Carter,” asked defense attorney Wende Cross.

“No, I would not do that,” Castellanos replied.

Permalink | Comments (1) | Post your comment | Categories: Dynus

Another name in ring for Butler commission seat

By Josh Sweigart | Thursday, August 6, 2009, 09:43 AM

Hamilton resident and regular campaigner Bob Weber has pulled petitions to run for Butler County commission in 2010.

Weber, a part-time professor at Miami University and active member of the local Republican party, had been in the news before as candidate for county auditor last year and more recently for Hamilton city council.

“I am not proceeding with the Hamilton City Council race, as the changes with county situation influenced my decision,” Weber wrote in an e-mail.

Commissioner Gregory Jolivette is the incumbent, but is facing a mounting list of challengers after it surfaced that he hired voted to hire his son as a temporary county employee in 2005.

Permalink | Comments (5) | Post your comment |

Bank exec: Money from Dynus deal ‘appears to have evaporated’

By Josh Sweigart | Wednesday, August 5, 2009, 10:23 AM

Federal court testimony Wednesday, Aug. 4, described how a couple of people were able to borrow millions of dollars from one of the country’s largest banks based on false promises and phony deals.

Prosecutors in the trial of former Dynus Corp. owner Orlando Carter asked National City Bank executive Ralph Martinez what happened to the $6.5 million the bank loaned Dynus in 2004 and 2005 for a deal with Butler County that didn’t exist.

“We don’t know,” Martinez said. “It appears to have evaporated.”

Martinez works for the business financing arm of National City Bank — which he described as the fifth largest financing company in America with deals totaling $9 billion.

Late last year, National City was purchased by PNC with help from the federal government’s bank bailout

Bank officials testified that they were threatened by Dynus president Jim Smith and then-Butler County auditor Kay Rogers in 2004 that they had far-reaching political connections and would jeopardize the bank’s business with other governments if they didn’t give a $5.2 million loan.

Smith told the bank he was an agent of the county and needed to borrow the money on the county’s behalf. This was the second loan he took out in the county’s name, the first was for $2.5 million.

The bank was retiscent, but Smith turned up the pressure, working late into the afternoon New Years eve to pressure the bank to unhand the money. He had Rogers — who Smith testified he had given a bribe — assure the bank the deal was sound, Smith and bank officials said.

“We really didn’t want a reputational risk,” said Vincent Rinaldi, CEO of the bank’s financing arm.

So the bank agreed to loan the company $4 million on the condition that it either provide a letter from the county prosecutor affirming the deal, or give back the money.

Carter’s defense team stressed that it was Smith, not Carter, who made the deal with the bank and that the bank did not try to contact Carter before the deal was struck.

Carter is fighting an 11-count indictment, including charges of bank fraud. Carter is alleged to have misrepresented his income to secure a $1.2 million home and misled banks about business deals with Butler County. He’s also accused of lying on a bankruptcy petition.

Permalink | Comments (3) | Post your comment | Categories: Dynus

County commission race could broaden

By Dave Greber | Wednesday, August 5, 2009, 08:36 AM

Following the announcement last week by county Treasurer Nancy Nix that she intended to make a run to unseat Commissioner Gregory Jolivette next year, we’ve been watching the Board of Elections closely.

On Tuesday, Aug. 4, a woman named Stacy Carpenter pulled a petition for “anonymous” for the 2010 Republican primary for Jolivette’s seat, according to BOE records.

When asked about the petition, Clerk of Courts Cindy Carpenter said Stacy Carpenter (no relation to the local office holder, Cindy said) was an employee in her office. I’ve since learned Stacy Carpenter is Cindy Carpenter’s executive assistant.

When asked about the purpose of the petition, Cindy Carpenter responded this way: “At this point, I am not making any announcements. I am talking with people within the (Republican) party.”

Cindy Carpenter said recent news regarding Commissioner Gregory Jolivette (read that here and here) and swirling allegations emanating from the federal trial of former Dynus Corp. owner Orlando Carter have ruffled some local feathers.

“Some of the office holders and department heads are dissatisfied with the current operation of county government,” Cindy Carpenter said. “Some of these people are not happy with the scandals that have occurred. It is very disheartening.

“There are many of us that believe that some things need to be done differently.”

We’re continuing to hear about folks who may run for the seat. It seems the list is growing with each passing day.

The question also remains about how the Republican Party would treat the screening process and endorsement meetings (in mid- to late-September and mid- to late-October, respectively) should Nix, Carpenter and the incumbent Jolivette decide to run.

Thoughts?

Permalink | Comments (9) | Post your comment |

JFS mum on hiring of commissioner’s daughter

By Dave Greber | Wednesday, August 5, 2009, 08:16 AM

After learning that Commissioner Gregory Jolivette had voted in 2004, 2005 and 2006 on motions involving his daughter’s hiring and pay with the county’s Department of Job and Family Services , I made a call to JFS Director Bruce Jewett.

Jolivette said last week that no conversations between he and Jewett regarding Elizabeth’s job ever took place, and that he had no influence over her hiring.

Jewett, however, declined to comment about the hiring Tuesday, Aug. 4, saying he did not want to impact an ongoing investigation into Jolivette’s voting record by Butler County Prosecutor Robin Piper.

Jewett said it was a decision he made by himself, and that Piper’s office did not advise him to remain quiet about the hiring.

The findings regarding Jolivette’s daughter came on the heels of the longtime politician admitting Thursday, July 30, he moved and voted in 2005 on the hiring of his son for the county’s summer work program.

Piper said Friday, July 31, he had finished his own investigation into both cases, and that he would be forwarding all information onto the Ohio Ethics Commission.

Permalink | Comments (2) | Post your comment |

Former GOP director testifies in Carter trial

By Josh Sweigart | Tuesday, August 4, 2009, 04:18 PM

Former Butler County GOP executive director Scott Owens testified this afternoon that Dynus Corp. paid him $100,000 to peddle influence with county officials.

Owens was a paid lobbyist working through the Lang Agency, which is owned by West Chester Twp. Trustee George Lang, Owens said. He said it was part of more than $300,000 Lang’s company was paid to help secure the company contracts with the county.

For his part, Owens said he introduced company officials to former county commissioner Michael Fox, former auditor Kay Rogers, current Commissioner Gregory Jolivette and Prosecutor Robin Piper.

“Were these people you were hired to make political connections with?” asked Assistant U.S. Attorney Richard Chema.

“Yes,” replied Owens.

The deal that emerged after these meetings led to Rogers resigning after pleading guilty to bank fraud for her part in Dynus securing a multi-million dollar loan in the county’s name without county approval.

Owens’ testimony came in the federal trial of former Dynus owner Orlando Carter today, Aug. 4.

Carter is fighting an 11-count indictment, including charges of bank fraud and forgery. Carter is alleged to have misrepresented his income to secure a $1.2 million home and misled banks about business deals with Butler County. He’s also accused of lying on a bankruptcy petition.

After making introductions, Owens said he left his work with the Lang Agency and was hired directly by Dynus for a salary of roughly $60,000, plus commission.

One of his key responsibilities there was getting Piper — who he had a close relationship with, having worked on his campaign — to sign an opinion of counsel letter confirming that the county had the loan.

But Piper wouldn’t sign, and Owens didn’t push it. Carter yelled so loud when he learned this that the person in the next cubicle could hear him, Owens said.

“He was upset and said it’s unacceptable, that it has to be signed,” Owens said.

“I can’t make something happen that’s not going to happen,” Owens said. “And I’m not going to break the law.”

Permalink | Comments (15) | Post your comment | Categories: Dynus

Dynus employee says she forged signatures of bank official, Kay Rogers

By Josh Sweigart | Tuesday, August 4, 2009, 02:59 PM

Former Dynus employee Karin Verbruggen testified in federal court this afternoon, Aug. 4, that she forged the names of a Butler County official and bank executive to mislead people about business deals the company had.

Verbruggen said she traced the name of a National City Bank official to alter a document to make it look like the company had a lease from the bank that was actually in the county’s name.

At another point, when Fifth-Third Bank had a firm conducting an audit of the company to maintain a line of credit, Verbruggen said her boss Jim Smith asked her to sign then county auditor Kay Rogers’ name to a letter saying there were no strings attached to the National City loan. In fact, the company had defaulted on its terms under the loan, Verbruggen said, and had no way of paying it back.

Verbruggen said she told Smith she was uncomfortable with forging Rogers’ signature and signed her name to a piece of paper to show that her handwriting looked nothing like Rogers’.

“I threw it in his garbage can,” she said, adding that Smith picked the signature out of the trash and used it.

Verbruggen’s testimony came in the federal trial of former Dynus owner Orlando Carter today, Aug. 4.

Carter is fighting an 11-count indictment, including charges of bank fraud and forgery. Carter is alleged to have misrepresented his income to secure a $1.2 million home and misled banks about business deals with Butler County. He’s also accused of lying on a bankruptcy petition.

On questioning from prosecutors, Verbruggen said she had conversations with Carter about a deal in which the company took out a multi-million dollar loan in the county’s name without the county’s approval.

On cross-examination, Verbruggen said she took her orders from Smith.

Verbruggen’s testimony was a requirement of her plea agreement after pleading guilty to bank fraud in relation to the deal.

Permalink | Comments (0) | Post your comment | Categories: Dynus

David Pepper to speak to local Democratic PAC

By Josh Sweigart | Tuesday, August 4, 2009, 02:16 PM

Press release from Butler County Progressive PAC:

Hamilton County Commission President and Ohio Auditor candidate David Pepper will be the featured speaker and guest of honor at the Thursday, August 13 meeting of the Butler County Progressive Political Action Committee.

The meeting of the Progressive PAC begins at 7 p.m. at the LCNB Bank Building, 30 West Park Place, in uptown Oxford. Commissioner Pepper is scheduled to speak at 8 p.m.

David Pepper was elected to the Hamilton County Commission in 2006, unseating an incumbent Republican. His election created a Democratic majority on the commission for the first time in forty years.

Before becoming a commissioner, Pepper served four years on the Cincinnati City Council. In his first race for political office in 2001, Pepper came in first out of 26 Council candidates. He repeated his first-place finish in 2003.

From 1993-1996, Pepper worked as an aide to former National Security Advisor Dr. Zbigniew Brzezinski in Washington and then St. Petersburg, Russia. He has worked with Henry Kissinger, Paul Bremer, and Vladimir Putin.

Pepper graduated magna cum laude from Yale University, where he earned Phi Beta Kappa honors and served as Managing Editor of the Yale Daily News. He is also a graduate of Yale Law School, where we won several school-wide awards and published three articles.

Pepper is a Democratic candidate for Auditor of the State of Ohio in the November 2010 election. He has been endorsed by Ohio Governor Ted Strickland, Ohio Democratic Party Chair Chris Redfern, and leading Democrats across the state.

The David Pepper visit is co-sponsored by the Butler County Democratic Party, the Preble County Democratic Party, Change Butler Political Action Committee, the Hamilton-Fairfield Democratic Alliance, and the Miami University College Democrats.

The Pepper meeting is open to all Butler County Progressive members and their guests. Memberships may be purchased at the door by paying the annual dues of $10.

Before Pepper’s address, the PAC membership will vote on candidate endorsements in the November 3 general election. Limited tickets for the Sept. 30 fund-raising Oxford concert with Chris O’Brien will go on sale at the meeting.

Formed last January, the Butler County Progressive Political Action Committee is an Oxford-based grassroots organization developed by neighborhood volunteers of the Obama-Biden campaign and sparked by President Obama’s Organizing for America movement.

The PAC’s mission is to promote the Obama administration agenda locally and to more firmly establish a progressive presence in Butler County politics, primarily by recruiting, educating, electing, and sustaining progressive candidates.

Permalink | Comments (2) | Post your comment |

Ex-Dynus exec: ‘Kickback’ went to auditor

By Josh Sweigart | Tuesday, August 4, 2009, 11:05 AM

Update: Smith says “kickback” was more of a “bribe.”

Original post:

Former Dynus Corp. President Jim Smith testified this morning about how he gave then-Butler County Auditor Kay Rogers a $9,500 “kickback” in 2005 while trying to get business with the county.

Smith said he tried to cut a company check, but was told not to by the company’s chief financial officer. So he wrote a personal check, he said, which was returned to him months later.

Smith’s testimony came during cross-examination during the federal trial of former Dynus owner Orlando Carter today, Aug. 4.

Carter is fighting an 11-count indictment, including charges of bank fraud and forgery. Carter is alleged to have misrepresented his income to secure a $1.2 million home and misled banks about business deals with Butler County. He’s also accused of lying on a bankruptcy petition.

Defense attorney Wende Cross suggested that Smith didn’t tell Carter about “the kickback to Kay Rogers in the Butler County deal.”

Smith said he told Carter everything, but maybe not some of the specifics about how Rogers was paid.

“You told the FBI that there was a phony company you were trying to take the money through to get it to Rogers, correct?” Cross asked.

“I think it was a company she worked for,” Smith said, believing it was called Capital Concepts.

This follows testimony Monday, Aug. 3, that Dynus had arrangements with several county officials to secure a deal with Butler County that the company had already told the bank existed — and had already borrowed millions of dollars for. Rogers resigned last year after pleading guilty to bank fraud for her role in the Dynus deal.

Permalink | Comments (2) | Post your comment | Categories: Dynus

Dynus trial continues. What new details will emerge?

By Josh Sweigart | Tuesday, August 4, 2009, 08:56 AM

The defense team for former Dynus Corp. owner Orlando Carter will continue cross-examination of former company president Jim Smith in federal court today.

This follows Smith’s tell-all testimony yesterday:

Former Dynus Corp. President Jim Smith told a federal jury Monday, Aug. 3, how he lied, forged documents, paid elected officials and concealed information from others to over-inflate his company’s profits.

Smith’s testimony came in the second week of the trial of former Dynus owner Orlando Carter, who is fighting an 11-count indictment including charges of bank fraud.

Smith said the company’s motto was “Up and to the right,” with Carter demanding that revenues increase every single month — even if it was just on paper.

Smith admitted to forging the name of former West Chester Twp. Administrator Dave Gully — currently administrator for Warren County — on a 2005 contract to make it look like he had a contract with the township that didn’t exist.

“(Carter’s) words were I don’t care if you have to sign it yourself, I want to book the revenue this month,” Smith said.

At the same time, Smith was trying to secure a deal with Butler County that he had told the bank already existed. In the process, he said he worked with then-Butler County Commissioner Michael Fox and then-Auditor Kay Rogers to conceal details of a deal between the county and company from other county officials.

Smith said he was introduced to Rogers and Fox through West Chester Twp. Trustee George Lang. Smith said he met Fox and Rogers at Jags, a restaurant owned by Lang, and discussed the need to hide the details of the deal from the county administrator, deputy administrator and Commissioner Charles Furmon.

“They would stop or slow down the deal,” Smith said.

For giving them access to county officials, Lang was paid more than $300,000, Smith said, roughly $100,000 of which was given back to Smith in “kickbacks.”

Smith said the company also paid $50,000 to Scott Owens, then executive director of the Butler County Republican Party. Owens was Lang’s campaign manager and worked on the campaign of county Prosecutor Robin Piper.

The hope, Smith said, was that Owens would use his connections to get Piper to sign an opinion of counsel letter that said a deal with the county indeed existed. Dynus needed that letter because it had already borrowed $4 million in the county’s name.

Smith’s testimony is part of his 2006 plea deal, in which he pleaded guilty to bank fraud in relation to the Dynus deal.

Rogers also pleaded guilty in relation to the deal and is awaiting sentencing.

In this story, we explore Smith’s motives, and his relationship with Carter:

Former Dynus Corp. President Jim Smith testified against his former boss and close friend Monday, saying that company owner Orlando Carter asked him to take the fall for the company taking out a multi-million dollar loan in Butler County’s name without county approval in 2004.

“(Carter) was like a brother to me,” Smith said. “We had a lot in common, we would go different ways and tell each other we love each other.”

Smith took the stand in Carter’s federal court trial Monday, Aug. 3, describing Carter as a shrewd businessman with direct oversight of how his company was run.

Carter’s defense team has argued he was not involved in the details of the Butler County deal.

The Mason man is fighting an 11-count indictment, including charges of bank fraud and forgery. Carter is alleged to have misrepresented his income to secure a $1.2 million home and misled banks about business deals with Butler County. He’s also accused of lying on a bankruptcy petition.

Smith described himself as ambitious, with a personal goal of retiring by age 40. He said he met Carter in early 2004 through his business dealings with West Chester Twp. Trustee George Lang, and found a mentor in Carter.

“If you want to learn to make a lot of money, you learn from somebody who has made a lot of it,” Smith said.

Smith quickly rose through the ranks from a consultant to company president.

But in its quest to chart unbridled profits, the company soon turned to unscrupulous means, Smith testified. He admitted to forging documents, saying the company had contracts with governments that it didn’t, lying to banks to borrow millions of dollars and bolstering the company’s books with contracts that didn’t exist.

“Why did you do those things?” asked assistant U.S. Attorney Richard Chema.

“Misguided greed and ambition,” Smith replied.

Smith said several public officials got pulled into the issue. This included then-Butler County Auditor Kay Rogers, who resigned after pleading guilty to bank fraud for her role in the Dynus deal.

Smith said he signed on behalf of Butler County for a $2.5 million loan from National City Bank for equipment to use the county’s fiber optic ring to build a telecommunications company in the county.

“Who told you to go ahead and do that, to sign for Butler County?” asked Chema.

“Kay Rogers,” replied Smith.

Smith said he later took out another $4 million loan from National City in the county’s name on the promise that he would produce a letter from the county attorney saying a deal existed.

When the bank balked, Smith said he had Rogers and then-county Commissioner Michael Fox — who later retired after serving as Children Services director — lean on a bank employee.

“They called me and told me they called and quote, unquote lit him up,” Smith said of the bank employee. “They basically told him they don’t know who we are, we’re the auditor and commissioner of the county and you need to get this done or we won’t do business with you.”

The bank agreed to the loan, with another $1.2 million to follow once the letter was produced. Despite repeated attempts to trick county officials into signing such a letter, Smith said a letter never came.

When other county officials and the banks caught wind of the dealings, Smith said Carter came to him and made him an offer.

“He said he wanted me to take the blame and that would be rewarded to me in the future,” Smith said.

Smith said he initially lied to the FBI during its investigation of the deal, but he had woven too tangled a web.

“It was overwhelming, trying to keep up with your own lies and what you’d said and what you hadn’t said,” he said.

Carter’s defense team had only begun its cross-examination of Smith when court adjourned Monday.

Smith said on cross-examination that he hoped to gain favor from U.S. District Judge Sandra Beckwith for cooperating in the trial under the terms of his plea agreement for pleading guilty to bank fraud.

Defense attorney Wende Cross stressed how freely and often Smith had lied during the investigation and that Smith was one of several Dynus employees Carter had close relationships with. She implied that the pressure to grow the company’s profits was personal, not a directive from Carter.

“You put a self-imposed pressure on yourself to do well, correct?” she asked. “You wanted to prove yourself to Orlando Carter, right?”

“Yes,” Smith replied. “I wanted to be a part of something big.”

Permalink | Comments (2) | Post your comment | Categories: Dynus

Commissioner, auditor, prosecutor, township trustee, GOP leader pulled into Dynus scandal

By Josh Sweigart | Monday, August 3, 2009, 12:47 PM

Former Dynus Corp. president Jim Smith told a jury in federal court this morning, Aug. 3, how he lied, forged documents, paid elected officials and concealed information from other officials to over-inflate his company’s success.

Smith said he forged the name of former West Chester Twp. administrator Dave Gully to make it look like he had a contract with the township that didn’t exist.

At the same time, he was trying to secure a deal with Butler County that he had told the bank already existed. In the process, he said he worked with former Butler County commissioner Michael Fox and former auditor Kay Rogers to conceal details of a deal between the county and company from other county officials.

Smith said he was introduced to Rogers and Fox through West Chester Twp. Trustee George Lang. Smith said he met Fox and Rogers at Jags, a restaurant owned by Lang, to discuss the necessity to hide the details of the deal from the county administrator, deputy administrator and Commissioner Charles Furmon.

“They would stop or slow down the deal,” Smith said.

For giving them access to county officials, Lang was paid $300,000, Smith said, roughly $100,000 of which was given back to Smith in a “kickback.”

Smith said the company also paid $50,000 to Scott Owens, then executive director of the Butler County Republican Party and campaign manager for both Lang and county Prosecutor Robin Piper.

The hope, Smith said, was that Owens would use his connections to get Piper to sign an opinion of counsel letter that said a deal with the county indeed existed.

Smith said he had already signed on behalf of Butler County for a $2.5 million loan from National City Bank for equipment to utilize the county’s fiber optic ring to build a telecommunications company in the county.

“Who told you to go ahead and do that, to sign for Butler County,” asked Richard Chema, assistant U.S. attorney.

“Kay Rogers,” replied Smith.

He later took out another $4 million loan from National City on the promise that he would produce the opinion of counsel letter.

The web of lies soon collapsed under its own weight, Smith said.

Permalink | Comments (15) | Post your comment | Categories: Dynus

Dynus motto: ‘Up and to the right’

By Josh Sweigart | Monday, August 3, 2009, 10:18 AM

Former Dynus president Jim Smith took the stand in company owner Orlando Carter’s federal court trial today, Aug. 3, describing Carter as a ruthless businessman with direct oversight of how his company was run.

Smith was ambitious, with a personal goal of retiring by age 40. He met Carter through his business dealings with West Chester Twp. Trustee George Lang, and found a mentor.

“If you want to learn to make a lot of money, you learn from somebody who has made a lot of it,” Smith said.

Smith was testifying today as part of his plea deal after pleading guilty to bank fraud for his part in the company taking out a multi-million dollar loan in Butler County’s name without county approval.

The scandal would rock Butler County, and unseat a county auditor.

Carter is fighting an 11-count indictment, including charges of bank fraud and forgery. He’s alleged to have misrepresented his income to secure a $1.2 million home, misled banks about business deals with Butler Count. He’s also accused of lying on a bankruptcy petition.

But back in 2004, it seemed there was nowhere to go but up.

“Up and to the right,” was the company’s motto, Smith said, and Carter expected each month’s revenue to exceed the month before it. Carter had Smith fire the man who introduce them because “(Carter) didn’t feel he was getting the job done.”

They spent many an evening at Jags, the restaurant owned by Lang, planning how to build their fortunes, Smith said.

“He was like a brother to me,” Smith said. “We had a lot in common, we would go different ways and tell each other we love each other.”

This contradicts Carter’s defense team, which aims to show that Carter was in the dark about the Butler County deal, and was misled by Smith about the particulars.

Permalink | Comments (4) | Post your comment | Categories: Dynus

Jolivette votes on jobs for son, daughter; now has challenger

By Dave Greber | Monday, August 3, 2009, 09:22 AM

In addition to covering the federal trial of Orlando Carter last week, a few items popped up regarding Butler County Commissioner Gregory Jolivette that demanded my attention.

It’ll likely be something we’ll continue to follow in the days and weeks to come.

The first story on Thursday (appearing in Friday’s JournalNews) showed Jolivette had voted to hire his son, Kevin, for a job with the county’s summer work program in 2005.

Jolivette made two claims: First, when prompted by former county Administrator Derek Conklin about the possibility of hiring Kevin, Jolivette said he asked whether the move would be legal. Jolivette said Conklin told him that it would be OK. Par for the course, especially as of late, Conklin declined to comment.

Next, Jolivette said he didn’t read the resolution (that was right before him at the commission dais) that included the motion to hire his son and another person for the county’s summer work program.

Jolivette admitted it looked bad, and said he asked the Ohio Ethics Commission to investigate. He said last week he felt the hiring was legal, per his interpretation of Ohio law.

He also said the timing smelled fishy because an anonymous letter sent to the JournalNews came on the heels of county budget cuts, and as Jolivette put it, “some very difficult decisions.”

The next day it was determined the longtime politician made similar moves when it came to his daughter’s employment with the county.

Jolivette routinely voted in 2004, 2005 and 2006 on payroll rosters for the county’s Job and Family Services Department, where Elizabeth Jolivette was hired in 2004. The first vote in 2004 was included in the monthly rosters of JFS, and Jolivette said he never got the information ahead of time that she was going to be included in the roster’s new hire sheet.

According to the county Auditor’s Office, Kevin Jolivette made $2,241.82 in 2005 and $4,129.66 in 2006.

Likewise, Elizabeth Jolivette made $5,214.60 in 2004, $3,312.00 in 2005 and $1,368.00 in 2006.

The news made Butler County Prosecutor Robin Piper none too happy. He said Friday he would be sending all the information his office obtained from Jolivette and others onto the Ohio Ethics Commission.

Said Piper: “It appears evident that Commissioner Jolivette voted in regard to hiring a family member and voted on the pay for a family member on more than one occasion,” Piper said. “We’ll let the Ohio Ethics Commission sort it all out.”

Also on Friday, county Treasurer Nancy Nix announced that she would challenge Jolivette for the commission seat next year; to which he responded: “At a time when we’re looking for unity, this is the state of our party,” Jolivette said. “I was a big supporter of her for the job (of treasurer). I thought we were friends, but apparently politics is bigger than friendship.”

Thoughts on any of this?

Permalink | Comments (6) | Post your comment |

 
Home | News | Sports | Entertainment | Opinion | Life | Recreation | Jobs | Cars | Homes
Advertising Media Kit | Online Ad Studio | Advertiser Tools | Customer Service | Our Partners | RSS | Site Map

Copyright © 2009 Cox Ohio Publishing, Dayton, Ohio, USA. All rights reserved.

By using this site, you accept the terms of our Visitors Agreement and Privacy Policy. You may wish to note our other business policies.

This website is ACAP-enabled