Larry Langford arrested, charged as part of 101-count Federal indictment

12.1.2008 by André Natta · → 3 Comments

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Birmingham Mayor Larry Langford, arrested early Monday morning at his job at Birmingham Budweiser, appeared in federal court in leg-irons and pleaded not guilty in federal court as prosecutors outlined a 101-count criminal indictment alleging bribery, conspiracy, fraud, money laundering and filing false income tax returns; he is named in 60 of them.

Langford, with longtime friend and lobbyist Albert LaPierre and Montgomery-based investment banker William Blount, are accused of creating “pay to play” criminal schemes in which they personally and professionally profited from Jefferson County’s billion-dollar sewer bond deals.

Langford was the County Commission president from 2003 to 2007, and oversaw the county’s financial committee. During that time, prosecutors allege Langford got as much as $235,000 from Blount through LaPierre, and that Blount’s firm, Blount Parrish & Co., received $7.1 million in fees from county bond swap transactions.

“As an elected official of Jefferson County, Langford had a duty of loyalty to the county and its citizens to refrain from using his public position and office to obtain personal benefits for himself,” said Birmingham U.S. Attorney Alice Martin during a 10 a.m. press conference, after the indictment was unsealed earlier Monday morning and after Langford’s arrest.

“He was supposed to place this county’s interests superior to his own personal interests,” she said. But instead of that, Martin said the federal investigation found and the 62-page indictment alleges that Langford “sold his office to his friends and his political supporters.”

While Martin held the press conference, Langford appeared before U.S. Magistrate John Ott, where he pleaded not guilty.

Langford, 60, was released in lieu of a $50,000 unsecured bond. The mayor mentioned that he was cold, but otherwise said nothing about the federal charges as he left the courthouse with his lawyer, Tom Baddley.

LaPierre, who appeared with Langford, and Blount, 55, who turned himself in shortly after Langford left the federal courthouse Monday, also pleaded not guilty. LaPierre, 58, was released in lieu of a $50,000 secured bond.

Martin’s office is seeking criminal forfeiture penalties totaling $7.1 million from each man: Langford who faces 60 counts, LaPierre who faces 22 counts, and Blount who faces 43 counts in Monday’s indictment.

The maximum sentence for each bribery and money laundering count is 10 years; for each fraud count is 20 years; for each conspiracy count is 5 years; and for each tax count is 3 years.

Martin said Blount was not involved in any Jefferson County bond deals prior to Langford’s arrival on the commission in 2003.

Between 2003 and 2006, Martin and the indictment claim that Langford received payments totaling $235,000 from Blount. They claim LaPierre, who received $219,500 from Blount as a consultant, acted as an intermediary to pass money from Blount to Langford in order to ease Langford’s “crushing personal debt.”

The debt included thousands of dollars of unpaid clothing bills, a bank loan (see pages 30 and 31 of the indictment). Prosecutors also allege Blount bought Langford expensive gifts such as a Tourneau watch and a Rolex watch, totaling about $22,000, and luxury clothing during trips to New York City, where commissioners discussed bond deals with Wall Street. The items were mailed to Langford’s commission office.

In discussing the laundering charges, Martin mentioned a June 2003 check for $69,000 from Blount through LaPierre to Langford. She claims Langford took the money, paid off a $12,000 audio equipment debt, paid a $12,000 clothing debt, and deposited the rest in his banking account.

In one series of alleged criminal transactions among the three men, prosecutors said Blount transferred $30,000 to LaPierre, who wrote a check for the same amount to Langford, who then got a bank check to pay his personal taxes.

Federal prosecutors allege that none of that money the two men received from Blount was reported as income on their tax statements, which led to the criminal tax fraud charges.

Martin claimed that Blount made the payments to Langford and LaPierre in order influence and reward Langford for making his firm part of the lucrative refinancing of Jefferson County’s billion-dollar sewer debt.

Blount’s firm eventually netted $7.1 million in brokerage fees, some of them through Wall Street firms such as J.P. Morgan, Goldman Sachs, and Lehman Brothers that refinanced the county’s huge bond debt in a series of bond-swap transactions. Martin said those firms got the business on the condition that they make Blount Parrish part of their transactions.

The indictment also names Blount as the Montgomery investment banker involved in the case against Mary Buckelew, a former Langford colleague on the Jefferson County Commission.

The Birmingham News reported in October that she pleaded guilty to obstruction charges after prosecutors said she lied under oath to a federal grand jury about receiving gifts totaling nearly $4,000 from a “Montgomery investment banker,” who was not officially identified as Blount named until today.

In her plea agreement, Buckelew admitted she knew Blount bought the gifts in order to influence her decisions to put his firm in the bond deals. She has agreed to cooperate with prosecutors’ continued investigations into corruption surrounding the county’s sewer bond deals.

In previous press conferences when asked about the federal investigations, Langford has steadfastly denied any wrongdoing and decried the invasion into his personal life. If he’s done any wrong, Langford has said, it’s having a good friend like LaPierre who is willing to loan him money when he needs it.

Defense lawyers in the case (Tommy Spina for LaPierre, David McKnight for Blount with Baddley for Langford) now have to go over the details of the indictment and meet with prosecutors to set timetables for what will likely be lengthy rounds of discovery and legal motions before U.S. District Judge L. Scott Coogler. He will determine which charges will go to the expected jury trial, which may take place by Spring 2009.

Langford’s Chief of Staff, Deborah Vance-Bowie, issued a statement early Monday morning from the Mayor’s Office about the arrest and charges. It said in part:

This is certainly no surprise to us — we anticipated something happening soon especially knowing Alice Martin’s days in office are numbered with the swearing in of a new president in late January — just a little over a month from now.

We are glad the Mayor will finally have his day in court. As members of his team, we stand behind him and look forward to the day when we can return the focus to the important issues before the city.

She wrote that the Mayor and his staff will “continue to do our jobs to ensure we deliver the best services to the taxpayers of Birmingham.”

Vickii Howell is the editor in chief of Birmingham View Magazine.

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