FOX19 Investigates: North College Hill manager accused of fraud, - Cincinnati News, FOX19-WXIX TV

FOX19 Investigates: North College Hill manager accused of fraud, conspiracy

Mark Fitzgerald (PHOTO: FOX 19 NOW's Jody Barr) Mark Fitzgerald (PHOTO: FOX 19 NOW's Jody Barr)
NORTH COLLEGE HILL, OH (FOX19) -

A sitting North College Hill council member has filed a whistleblower lawsuit, claiming the city manager committed fraud and illegally awarded a city contract to a friend. The suit, filed by council woman Shawna O'Shea is making its way through the Hamilton County courthouse.

O'Shea accuses city manager Mark Fitzgerald and former mayor Dan Brooks of devising a conspiracy to “dupe” NCH council into giving Fitzgerald a $41,000 pay raise in order to boost Fitzgerald's monthly retirement checks from the state retirement system. Also included in the lawsuit, O'Shea claims Fitzgerald illegally signed a contract to award his friend work that paid $65 an hour inspecting and enforcing the city's building codes.

RETIREMENT SYSTEM FRAUD ALLEGATIONS

In December 2011, North College Hill then-mayor Dan Brooks sent a letter to council, asking to combine city manager Mark Fitzgerald's $84,000 annual salary with his wife, Linda's, $41,000 salary. Linda was working for the town as economic developer at the time.

The Fitzgeralds were working for NCH as private contractors: Mark was providing administrative services and Linda was providing economic development services. The arrangement, according to Brooks' letter, was to save the town money by not paying benefits to the Fitzgeralds.

In the letter, Brooks asked council to approve a plan to combine both salaries. That would give Mark a raise totaling $125,000—not including benefits. Fitzgerald's total salary—including benefits—would come to $146,730, according to city finance records attached to the lawsuit. The deal also required Linda to work 30 hours a month and continuing to perform economic developer duties for NCH.

In April 2013, council records show the deal passed.

Soon after the ordinance's passage, taxpayers started questioning the arrangement. One in particular, Nicholas Link, found out the details of the plan and filed a formal complaint of fraud against Fitzgerald. Link is a former NCH councilmember and former NCH auditor.

"We couldn't let that continue,” Link said, “I mean, if it continues in one place, people will find out about it--'Oh, you hear what North College Hill's doing? Why don't we do that, too?' The problem is, the tax payers were getting bilked, the

The Fitzgeralds were working for NCH as private contractors: Mark was providing administrative services and Linda was providing economic development services. The arrangement, according to Brooks' letter, was to save the town money by not paying benefits to the Fitzgeralds.

In the letter, Brooks asked council to approve a plan to combine both salaries. That would give Mark a raise totaling $125,000—not including benefits. Fitzgerald's total salary—including benefits—would come to $146,730, according to city finance records attached to the lawsuit. The deal also required Linda to work 30 hours a month and continuing to perform economic developer duties for NCH.

In April 2013, council records show the deal passed.

Soon after the ordinance's passage, taxpayers started questioning the arrangement. One in particular, Nicholas Link, found out the details of the plan and filed a formal complaint of fraud against Fitzgerald. Link is a former NCH councilmember and former NCH auditor.

Link filed the initial complaint last summer by phone with the Ohio Public Employees Retirement System offices in Columbus. “A millisecond after I had explained the circumstances, ‘They can't do that. That's exactly what his (OPERS official) words were,” Link recalled.

Link told FOX19 the officials asked for records to support his claim and he mailed contracts, ordinances and council minutes to Columbus.

After supplying the agency with records, Link said OPERS would not provide updates on the investigation citing “privacy concerns.” The complaint, Link said, was that Fitzgerald was drawing two incomes and only reporting the salary as his.

State retirement monthly payment amounts are set by an average of the three highest annual salary totals. Under the deal, Fitzgerald stood to draw a much higher monthly retirement draw.

"We couldn't let that continue," Link said, "I mean, if it continues in one place, people will find out about it-'Oh, you hear what North College Hill's doing? Why don't we do that, too?' The problem is, the tax payers were getting bilked, the system was being scammed and that's basically why did what I had to do."

WHERE IS THE OPERS COMPLAINT

It was nearly 18 months ago that Nicholas Link filed the fraud complaint with the Ohio Public Employees Retirement System. As of this report, Link said he has not been able to get an update on what, if anything, OPERS did with the information.

FOX19 reached out to the Ohio State Auditor's office to see whether that agency is investigating any complaints from North College Hill. The auditor's communications staff told FOX19 the state is currently conducting a standard bi-annual audit of NCH's finances, but the audit is a standard audit for all public entities in the state. The agency also confirmed there is no pending or closed fraud complaints regarding North College Hill.

Ohio Attorney General Mike DeWine's office is currently checking its files to see whether it has any open or closed fraud investigations out of NCH. AG Spokesman Dan Tierney told FOX19 the AG's office would not typically investigate pension complaints unless requested to do so by a prosecuting attorney. As of this report, the AG's office does not think it has a case regarding NCH, but Tierney said he's awaiting final confirmation from legal staff. Pension complaints, Tierney said, are typically investigated by OPERS investigators, then turned over to the local law enforcement agency with jurisdiction.

We also checked with OPERS on whether the agency has a pending, current, or closed fraud complaint against Fitzgerald. As of this report, OPERS has not answered a request from FOX19 as to the status of any such investigation.

COUNCIL WOMAN SUES FITZGERALD AND NORTH COLLEGE HILL

After taking office in January, North College Hill council woman Shawna O'Shea said she started getting questions about the Fitzgerald salary deal. O'Shea said she grew curious herself after she started piecing together the details of the agreement.

“If there's an injustice it needs to be fixed and that's what it's all about,” O'Shea told FOX19 following a Dec. 4 hearing on the lawsuit she filed against Mark Fitzgerald and NCH. “We all work extremely hard for our money and we want what's best for our money,” O'Shea said.

O'Shea's suit initially listed XPEX as a defendant, but Hamilton County records show the judge approved an agreement between O'Shea and XPEX to allow XPEX to be dismissed as a defendant in the suit on Nov. 25.

O'Shea filed the lawsuit June 26, asking a judge to end the salary agreement between Fitzgerald and the city stating Fitzgerald “has obtained City funds through fraud.” O'Shea wants the court to order Fitzgerald to stop “using, transferring, or spending any such funds he unlawfully received.”

O'Shea's suit claims the Fitzgerald salary “scheme” was a way for former mayor Dan Brooks to do the Fitzgeralds a favor, all the time hiding their real intentions from North College Hill's city council. “Council and the Administration conspired to hide Linda Fitzgerald's employment to OPERS, and over-report Defendant Mark Fitzgerald's compensation to OPERS,” according to the lawsuit.

“Mark Fitzgerald and Mayor Brooks conspired to misrepresent to Council that Linda Fitzgerald was part of the package even though they knew Linda Fitzgerald would not perform any duties,” O'Shea's suit states, “Mark Fitzgerald, Linda Fitzgerald and Mayor Brooks continued this charade…for two years.”

FOX19 left messages at Brooks' home and at his office inside Harrison city hall, but Brooks never responded so we could include his side in this report.

The suit also asks the court to undo a contract Fitzgerald authorized, awarding Cincinnati-based building inspection firm XPEX. The suit claims Fitzgerald presented council a contract in March, awarding XPEX and its owner Gerry Stoker with the NCH Building Official contract. The deal allowed XPEX to collect $65 an hour to enforce NCH building codes and paid the firm 60 percent of all building fees.

Stoker, according to the lawsuit, is friends with Fitzgerald.

In March, the lawsuit states Fitzgerald presented the contract to council for approval. Council records show NCH's elected leaders denied the contract after finding out it was not competitively bid.

A copy of the contract attached as an exhibit to the complaint shows days later, Mark Fitzgerald and Stoker signed the contract.

“I took living in the neighborhood that I have invested time and sweat and tears into; I took that very serious and I felt like someone needed to speak and so, here I am,” O'Shea told FOX19.

DENIED: FITZGERALD WANTS LAWSUIT DISMISSED

On Dec. 4, Mark Fitzgerald's attorney argued that the lawsuit against his client be dismissed, claiming Shawna O'Shea failed to list any specific fraud committed by the North College Hill city manager. This is the second dismissal hearing in the case; both have been denied.

On Dec. 11, Hamilton County Common Pleas Judge Robert Ruehlman denied Fitzgerald's request to have the case dismissed. The judge ordered plaintiff attorneys to draft a filing that will serve as the official order. That order has not been filed as of this report.

The next step in the case is discovery, a process that is already underway.

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