Moreland Hills Man Charged with Bribery and Embezzlement

April 22, 2010 - Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, announced today that an information has been filed charging William B. Schatz, age 64, of Moreland Hills, Ohio, with one count of bribery in federally funded programs, one count of theft and embezzlement in federally funded programs, and five counts of filing false tax returns.

William B. Schatz was the general counsel of the Northeast Ohio Regional Sewer District (NEORSD) from 1979 until his retirement in August 2007. During his tenure, the NEORSD had major sewage tunnel contracts including the Mill Creek Tunnel Contract, Phases 2 and 3. The information states that from in or about 2000, through on or about April 26, 2007, Schatz corruptly solicited and accepted approximately $682,130.00, from a contractor, identified as Contractor No. 1, who was part of a joint venture working on the Mill Creek Tunnel Contracts. The information alleges that Schatz received the payments through an intermediary company, identified as Client Company No. 1.

The Information also states that from in or about 2002, through on or about December 15, 2005, Schatz embezzled, stole, and obtained by fraud NEORSD property by, among other things, depositing checks made payable to NEORSD (including insurance premium returns and NEORSD tenant payments) totaling approximately $166,940.00 into accounts he controlled using a fraudulent deposit stamp he had obtained for this purpose.

The Information further alleges that Schatz failed to report income from his private law practice, as well as his bribery and embezzlement income, on his Form1040, U.S. Individual Income Tax Returns in the amount of $148,213.00 for the calendar year 2003; $219,678.00 for the calendar year 2004; $185,527 for the calendar year 2005; $179,929.00 for the calendar year 2006; and $88,975.00 for the calendar year 2007.

U.S. Attorney Dettelbach stated: “The message from today’s filing is very clear: If we find corruption and self-dealing in public contracts, our office, along with our partners at the FBI and IRS, will investigate and will prosecute.”

If convicted, the defendant’s sentence will be determined by the court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.

This case is being prosecuted by Assistant United States Attorneys Justin J. Roberts and Daniel J. Riedl, following an investigation by the Cleveland offices of the Federal Bureau of Investigation and Internal Revenue Service, Criminal Investigation Division.

An information is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.