U.S. court ruling erodes corruption cases

A U.S. District Court judge’s decision to overturn the conviction of a former Philadelphia tax assessor who accepted $20,000 in cash is the latest fallout from a U.S. Supreme Court ruling that has undermined many public corruption cases.

Former assessor James Lynch accepted money in an envelope after he’d helped a businessman get a lower tax bill. Since there was no evidence he’d asked for the cash, he wasn’t charged under bribery laws.

Instead, he was accused of “honest services fraud,” for years a favorite tool of prosecutors. Assistant U.S. Attorney Robert Zauzmer said it’s a statute from the 1980s that defines corruption broadly.

“Congress decided that where a public official deprives citizens of their right to his or her honest services, that that’s a type of fraud,” Zauzmer said.

So in the assessor’s case, or the case of a politician who uses public contracts to extract political contributions, a prosecution can be based on the notion that the official didn’t disclose a clear conflict of interest, denying the public his honest services.

But in the case of former Enron president Jeffrey Skilling, the Supreme Court struck down that broader definition of honest services fraud.

“The Supreme Court said, instead, that the only thing the honest services fraud covers is bribery or kickbacks,” Zauzmer said.

And so many convicted public officials, including former Philadelphia City Councilman Rick Mariano are in court seeking reversals of their fraud convictions. Zauzmer, who said the facts differ in every case, said he believes there are strong arguments to sustain many convictions.

Former U.S. Attorney Peter Vaira said in an interview there will be an impact on future public corruption cases.

“There’s no doubt that the prosecutors will continue to go after local officials,” Vaira said. “They just can’t keep going to the outer limits and trying to bring every questionable act (to court).”

The government still may appeal the reversal of Lynch’s conviction.