Lehigh Valley

Bethlehem entrepreneur admits paying bribes to Allentown public official

Mayor Ed Pawlowski implicated but not named in federal documents

Mayor Ed Pawlowski implicated but not named in federal docs

PHILADELPHIA - Allentown Mayor Ed Pawlowski has been implicated by federal investigators as the recipient of bribes paid by a Bethlehem entrepreneur in an alleged "pay-to-play" scheme.

Ramzi Haddad, 45, of Bethlehem, admitted in federal court in Philadelphia on Thursday to paying bribes to a person identified in court papers only as "public official #3," who "represented the city through an elective office" and aspired to win election to statewide office, according to United States Attorney Zane David Memeger.

To achieve that goal, federal authorities said "public official #3" knowingly sought campaign contributions in exchange for official actions that he took and attempted to take.

LINK:  FEDERAL COURT FILING (pdf)

As a result, Haddad expressed his concern to investigators that "public official #3" would interfere with and block his projects in Allentown, so he concluded that the only way to receive a "fair shake" was to give "public official #3" items of value, including food, drinks and contributions to his various campaigns, officials said.

According to federal authorities, "public official #3" formally announced his candidacy for election to federal office on April 17, the same day Pawlowski announced his bid for the Democratic nomination in the race for the U.S. Senate seat held by Republican Pat Toomey.

Prior to making his announcement, "public official #3" told Haddad about his plan to run and asked him to raise money for the campaign by bundling his own contribution with those of others, officials said.

On May 18, "public official #3" traveled from Allentown to New York City to meet with Haddad and discuss the official "help" he could provide in return for the contributions Haddad would raise for the federal campaign, according to authorities. In consideration for Haddad's commitment, investigators said "public official #3" agreed to intervene with municipal inspections of one of Haddad's buildings in Allentown.

On June 29, Haddad delivered to "public official #3" approximately $15,000 in checks, all made payable to the federal campaign. "Public official #3" then reminded Haddad of his pledge to raise $25,000. The next day, Haddad handed over two more checks, totaling $6,500, both made payable to the federal campaign, officials said. Those checks were intended to replace a check delivered the day before.

"Public official #3" stands accused of taking numerous steps to "destroy or avoid creating any records that would show a linkage between his official actions and campaign contributions" from donors such as Haddad.

Pawlowski's attorney issued a statement denying any wrongdoing.

"Despite the headline in the prosecutors' press release, Mr. Haddad did not pay a bribe. The innuendo and allegations do not change the facts. Mr. Haddad received nothing from Mayor Pawlowski in exchange for legal campaign contributions. Mayor Pawlowski has never accepted an improper payment, engaged in pay to play, or even been offered, let alone accepted a bribe. Mayor Pawlowski is a trusted public servant who has never misused his office," attorney Mark Schamel said in a statement. 

Pawlowski suspended his Senate campaign on July 6, four days after FBI agents raided City Hall offices on July 2. He is in his third term as the city's mayor.

According to campaign finance records obtained by 69 News, Haddad donated $5,000 to Pawlowski's campaign for governor in 2013. He also donated money to his mayoral campaign -- $1,000 in 2013, $2,500 in 2014 and $2,500 in 2015.

Haddad pleaded guilty to one count of conspiracy to commit bribery offenses. Scheduled to be sentenced Dec. 18, he faces a possible sentence of up to five years in prison, a $250,000 fine and three years of supervised release.

No other charges have been filed in connection with the federal investigation.

69 News had an interview scheduled with Pawlowski for another story Thursday afternoon, but that interview was cancelled after Haddad's guilty plea was announced.

Palowski's attorney, Mark E. Schamel, who works for a Washington, D.C.-based firm, released the following statement:

"Despite the headline in the prosecutors' press release, Mr. Haddad did not pay a bribe. The innuendo and allegations do not change the facts.

"Mr. Haddad received nothing from Mayor Pawlowski in exchange for legal campaign contributions.

"Mayor Pawlowski has never accepted an improper payment, engaged in pay to play, or even been offered, let alone accepted a bribe.

"Mayor Pawlowski is a trusted public servant who has never misused his office."

Allentown City Council President Julio Guridy told 69 News that he had no prior knowledge of Haddad's guilty plea, and he said it's still premature for council to take any action against Pawlowski.

"My conversations with the mayor is that he hasn't done anything wrong. That's what he told me," Guridy said.

Pa. Rep. Mike Schlossberg, the youngest person ever elected to Allentown City Council, also spoke out Thursday.

"This is a difficult day for Allentown," he said. "I am obviously saddened - and deeply concerned - by this news. All of this being said, too much has gone right in Allentown for the actions of a handful of people to derail it. The residents of Allentown have gotten through worse, and we will get through this."

Reading and the campaign of that city's mayor, Vaughn Spencer, are part of the federal investigation. FBI agents converged on Reading City Hall and Spencer's home on July 10, nine days after they conducted their raid in Allentown.

Less than a month later, on Aug. 5, Reading City Council President Francis Acosta admitted in federal court to taking a bribe in exchange for repealing part of the city's ethics law. Acosta, who pleaded guilty to conspiracy to commit bribery offenses, resigned from his post the same day.

Acosta's attorney, Robert Goldman, told 69 News that the bribe came from the mayor, Spencer, who has not been charged in the case, and that the money would be used as campaign funds for Acosta's wife, Rebecca, who ran an unsuccessful May primary campaign for district judge in Reading.

Acosta is due to be sentenced Nov. 18.

WFMZ's Jamie Stover is working on this developing story. She'll have the latest in live reports on 69 News. In the meantime, refresh this page for updates as information becomes available.


DISCLAIMER FOR COMMENTS: The views expressed by public comments are not those of this company or its affiliated companies. Please note by clicking on "Post" you acknowledge that you have read the TERMS OF USE  and the comment you are posting is in compliance with such terms. Your comments may be used on air. Be polite. Inappropriate posts or posts containing offsite links may be removed by the moderator.

Allentown, PA 18102

42°F

Overcast

TONIGHT

34°F

  • %

This Week's Circulars

Top Stories

Latest from the newsroom

More from the Newsroom