Hardrives collected nearly $20,000 from Mahoning County and Struthers for asphalt not used for paving projects, the government says.
By PATRICIA MEADE
VINDICATOR CRIME REPORTER
CLEVELAND -- Three days after the owner of Hardrives Paving & amp; Construction pleaded guilty to charges that include bribing a congressman, the government charged his asphalt plant supervisor with mail fraud.
A two-count criminal information filed Thursday afternoon in U.S. District Court charges Edward Pannutti, 47, of Badal Drive, Lowellville, with generating fake invoices for asphalt not used on streets in Struthers in 1996 and Mahoning County's road projects in 1997.
At the time, Pannutti served as supervisor at Hardrives' asphalt plant in Youngstown. He used the U.S. Postal Service to send the phony invoices to, and receive checks from, Mahoning County for $8,750 and Struthers for $10,082, the government said.
The information charges that from April to August 1996, Pannutti and unidentified others devised a scheme to swindle Struthers, and from April to October 1997 schemed to defraud Mahoning County.
Legal proceeding: For the government to file an information, the defendant must waive his right to indictment by a grand jury. The defendant then, in nearly all cases, agrees to plead guilty as part of the waiver and the plea agreement may require him to testify against co-defendants.
Pannutti's Boardman lawyer, Samuel G. Amedolara, could not be reached.
Pannutti has an unlisted phone. He was not home Thursday evening and his wife told The Vindicator that she didn't know if he had signed a plea agreement.
The case was investigated by the FBI, IRS, U.S. Department of Transportation and U.S. Department of Labor. It is being prosecuted by Richard H. Blake, an assistant U.S. attorney and member of the Organized Crime Strike Force.
Blake had no comment.
Maximum penalty: The maximum penalty for each mail fraud count is five years in prison and a $250,000 fine.
Pannutti's boss at the time of the charges was Canfield contractor James R. Sabatine, 49, who pleaded guilty Monday in federal court to a two-count criminal information that had been filed Aug. 2.
He admitted to engaging in a pattern of racketeering between June 1993 and December 1999 -- including mail fraud and three counts of bribery. He also admitted filing a false tax return for 1994, understating his income by $239,000.
Sabatine admitted that in August 1998 he paid U.S. Rep. James A. Traficant Jr., of Poland D-17, a $2,400 bribe to have the congressman intervene on his behalf to secure a rail line and steady supply of raw materials to the asphalt plant. Sabatine also bribed former Mahoning County Engineer William P. Fergus with $20,000 in 1994 for favorable treatment and bribed an unnamed inspector at the county engineer's office with $7,300 between 1993 and 1997.
Sabatine said he and a minority contractor, Renee Smith, doing business as Tone Crack Sealing & amp; Supply Co., devised a scheme between July 1995 and November 1998, to fraudulently obtain government paving contracts that were set aside for minority businesses in Ohio. Smith has not been charged.
Sold company: Earlier this year, Sabatine sold Hardrives. He is free on $500,000 unsecured bond and his sentencing has been deferred until he fulfills his obligation to testify for the government at upcoming trials, including Traficant's.
A grand jury indicted Traficant in May on 10 counts that include racketeering, bribery and tax evasion. His trial is set for February.
In return for Sabatine's unlimited on-demand cooperation, which extends to state courts, the government will recommend that he receive a 10- to 16-month sentence, a portion of which must be spent incarcerated. So far, he and two other prominent businessmen are expected to testify against Traficant.
Pannutti's case has been assigned by random draw to U.S. District Court Judge Dan Aaron Polster in Akron. The government is expected to ask that it be transferred to U.S. Judge Lesley Brooks Wells, who has Traficant's case.