Former Executive Director of South Amboy Housing Authority Sentenced to 30 Months in Prison

Previously Pleaded Guilty to Federal Election Fraud and Tax Evasion

TRENTON—Thomas J. O’Leary, the former executive director of the South Amboy Housing Authority, was sentenced today to 30 months in prison for his role in a scheme to funnel illegal campaign contributions to the Democratic primary election campaign of Joseph Vas for U.S. Congress in 2006, as well as evading taxes, U.S. Attorney Paul J. Fishman announced.

O’Leary, 50, of South Amboy, New Jersey, previously pleaded guilty before U.S. District Judge Freda L. Wolfson in Trenton federal court to charges of conspiracy to defraud the Federal Election Commission for his participation in a scheme to funnel thousands of dollars through straw contributors to Vas’ campaign and to one count of tax evasion.

According to the indictment and information to which O’Leary pleaded guilty and statements made in court:

O’Leary admitted he participated in a scheme with co-defendant Francis X. Gartland, an insurance broker based in Towson, Maryland, to use “straw” or “conduit” contributors to make contributions to the 2005-2006 Vas congressional campaign for the 13th Congressional District. Gartland, through his various companies, was the insurance broker of record for the city of Perth Amboy and the Perth Amboy Board of Education. Gartland received thousands of dollars in commissions for those representations and split a portion of the commissions with O’Leary. The purpose of the straw contributions to Vas, then the mayor of Perth Amboy and a New Jersey State assemblyman, was to ensure that Gartland maintained the lucrative insurance brokerage representations with the city of Perth Amboy and the Perth Amboy Board of Education.

O’Leary acknowledged that he recruited five straw contributors to contribute $2,000 each to Vas’ federal campaign committee. He reimbursed the straw contributors by cash or check with funds provided by Gartland. Straw contributions are prohibited by the Federal Election Campaign Act. O’Leary also admitted that for tax year 2006, he evaded the assessment of thousands of dollars of federal income tax by concealing income and other benefits that he received from Gartland.

In addition to the prison term, Judge Wolfson sentenced O’Leary to three years of supervised release and fined him $12,000.

Vas and Melvin Ramos, Vas’ former mayoral aide and the treasurer of Vas’ campaign, were convicted on October 8, 2010, following a jury trial, of charges of mail fraud, fraud and misapplication of funds, false statements, and federal election crimes. Vas and Ramos were sentenced to 78 and 37 months in prison, respectively, by U.S. District Judge Susan D. Wigenton on April 12, 2011. In addition to the prison terms, Judge Wigenton sentenced Vas and Ramos to three years of supervised release and ordered them to pay $90,000 in restitution to Perth Amboy. Vas was also ordered to pay a $73,200 fine.

The federal election crime charges pertaining to Gartland involving O’Leary are pending before Judge Wolfson. In December 2010, Gartland also was charged in a 27-count superseding indictment along with Michael J. Ritacco, the former superintendent of the Toms River Regional School District, with charges relating to bribery and tax fraud. The superseding indictment charged Gartland and Ritacco with scheming with others, including co-conspirators Frank Cotroneo and Frank D’Alonzo, to pass a stream of cash payments and other benefits totaling between $1,000,000 and $2,000,000 from Gartland to Ritacco in exchange for Ritacco’s official action and influence in matters relating to the Toms River Regional School District’s insurance business. The superseding indictment also contains two counts charging separate conspiracies to defraud the IRS and seven counts of making and subscribing false federal personal income tax returns—for tax years 2004 to 2006 for Ritacco and 2004 to 2007 for Gartland. Cotroneo and D’Alonzo both pleaded guilty in federal court to bribery and tax charges related to this scheme on October 18, 2010, and await sentencing. Ritacco previously pleaded guilty and was sentenced September 14, 2012, to 135 months in prison. Gartland pleaded guilty on April 2, 2012, to charges of mail fraud, separate conspiracies to defraud the IRS and the United States government, and perjury. He will be sentenced in November 16, 2012.

U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Michael B. Ward; and IRS-Criminal Investigation, under the direction of Special Agent in Charge Victor W. Lessoff, with the investigation leading to today’s sentence.

The government is represented by Assistant U.S. Attorney Lee M. Cortes, Jr. of the U.S. Attorney’s Office Special Prosecutions Division in Newark.