UPDATED WITH REACTION FROM MAYOR BALLARD ON SCANDAL! Mayor Greg Ballard today responded to the stunning developments of Tuesday when FBI agents raided the City-County Building and arrested five individuals, including two city employees in a scandal involving the city’s Land Bank. Indianapolis media swarmed Mayor Ballard in an impromptu news conference. The Mayor talked about when he was informed of the FBI investigation, the current status of the Land Bank, his reactions to the arrests of city employees and what he will do to clean up the mess. Click the Arrow Below to Hear the Mayor’s comments. Runs 10 Minutes.
. In a stunning, historic development, Federal agents raided the Indianapolis City-County Building as part of an effort to root out public corruption in Indianapolis. Five individuals, including two city employees, including an Ass’t Administration of the City’s Department of Metropolitan Development were indicted by a Federal Grand Jury with multiple counts of wire fraud and bribery in a scandal involving the Indianapolis Land Bank. Reggie Walton, 29, Ass’t Administrator of DMD was charged with three counts of wire fraud, and two counts of bribery. Another employee of DMD, John Hawkins, 27, a Senior Project Manager was charged with one count of bribery. David Johnson, 57, who heads the non-profit New Gay Residential Development, was charged with bribery as was David Johnson, 47, Executive Director of the non-profit Indianapolis Minority AIDS Coalition. A fifth individual, Aaron Reed, 35, the registered agent of a for profit real estate group called Naptown Development Group was charged one count of wire fraud and one count of bribery. In announcing the indictments, USA Attorney Joe Hogsett said, “These charges involve a conspiracy to defraud the taxpayers of Indianapolis and abuse a local housing program designed to help rebuild this city’s most troubled neighborhoods. For those in positions of public trust, both here in Indianapolis and across the state, I hope these developments have confirmed the message: the era of corruption is over.” The investigation involved an undercover FBI agent and FBI wiretaps. FBI Special Agent in charge Robert Jones said, “The FBI criminal program’s top priority is public corruption. The integrity of our public officials is the cornerstone of fair governance.” This is the first time since UniGov was created in 1971 that Federal law enforcement officials had levied charges against employees of an Indianapolis city department for serious Federal crimes. Downtown workers, especially employees in the City-County Building were stunned when they saw a truck belonging to the Indianapolis office of the FBI parked in front of the City-County Building. And saw FBI agents and Indiana State Police carrying boxes of documents and computers out of the building after obtaining them from the DMD offices through a search warrant. According to the Indianapolis Business Journal, which first reported on irregularities in the operation of the Indianapolis Land Bank last fall, the alleged scheme involved nonprofits purchasing properties listed in the Indianapolis Land Bank for far less than their fair market value. These properties were then sold at very low cost to non-profit organizations who then re-sold the properties at high prices to private purchasers and developers. The Federal indictment charges that Walton and Hawkins received bribes and kickbacks from the other co-defendants as payments for funneling the properties their way. The indictment also alleges that one of the defendants accepted a bribe an undercover FBI agent. The Indianapolis Land Bank was created in 2007 by the Legislature. Its mission is to acquire abandoned, tax delinquent and other problem properties, and make them available for redevelopment to non-profit/for-profit developers and the general public. Ideally, according to the City, the Land Bank would return troubled properties to productive and economically viable use, eliminate public safety hot spots, and improve the quality of life in Indianapolis neighborhoods. And the properties would return to the tax rolls. The Land Bank is a part of the city’s Department of Metropolitan Development which is one of the major UniGov departments. Its Director reports directly to the Mayor. In response to the Federal investigation and charges, Mayor Greg Ballard said, “I take these allegations very seriously and I will not tolerate abuse of the public trust. That’s why I initiated the toughest ethics and first whistle blower laws in the history of the city. Mr. Walton and Mr. Hawkins are suspended without pay effective immediately. I appreciate the work of federal officials in this matter and my team will continue to assist them in this investigation. The alleged acts of these two individuals do not reflect the dedication of the thousands of employees who work hard to improve our city every day.” Afternoons with Amos talked live with US Attorney Joe Hogsett about the indictments and the on going investigation into public corruption and this Land Bank case. Amos also talked with Indianapolis Business Journal Managing Editor Cory Schouten whose newspaper first broke the story of problems at the Land Bank last fall. AM1310TheLight’s Cameron Ridle also shared info about the charges. Click Link To Read the Federal Charges. Federal Indictments In Land Bank Fraud Click Arrow to Hear Amos’ Interview with Joe Hogsett. Runs 11 Minutes.