Red Light Camera Company CEO Sentenced to Prison for Bribing City Officials for Municipal Contracts - PINAC News
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Red Light Camera Company CEO Sentenced to Prison for Bribing City Officials for Municipal Contracts

Karen Finley, former CEO of the red light camera company Redflex Traffic Systems, was sentenced to 14 months in prison last week after pleading guilty to federal corruption charges over backroom bribes in Ohio.

Finley offered political campaign contributions to city council members in Cincinnati and Columbus in exchange for municipal contracts with the company.

She faces a separate sentencing in Chicago next month after pleading guilty to charges there.

Karen Finley said she knew bribing city representatives was illegal, but did it anyway in order to obtain municipal contracts.

Karen Finley said she knew bribing city representatives was illegal, but did it anyway in order to obtain municipal contracts.

“I knew of the solicitations and agreed along with Redflex to provide the campaign funds in exchange for the offcials taking action so Redflex could obtain and retain municipal contracts,” read Finley’s letter to US District Judge Michael H. Watson earlier this month, admitting she conspired to pay bribes to city representatives at the request of Redflex lobbyist John P. Raphael.

“Raphael was used as a pass-through to conceal the nature of the money going to Raphael and, ultimately, the elected officials.”

In addition to her time at the minimum security federal pen in Phoenix, Finley was ordered to pay a $100 assessment fee, spend a year on probation after her release and turn in any firearms.

Prosecutors asked for 30 months, but Finley’s defense team persuaded the judge to hand down 14 months, arguing the culture of corruption at Redflex was to blame.

“Karen walked into a position with the company where fraud was already occurring. And as a result, she put herself in a place where she became a party to it,” Michael D. Kimerer, Finley’s attorney argued.

“Although Karen might not have known at the time the full extent of her criminal conduct, at the very minimum, she acted with willful blindness,” he admitted.

Federal investigators were willing to coax prosecutors to go light on Finley because of her eagerness to testify against her former boss, Bruce Higgins, and other co-conspirators.

Higgins, an Australian citizen, escaped charges in the US, but may still find himself in legal trouble in his own country.

“In April and May 2016, members of the Australian Federal Police requested through the FBI and Ms. Finley’s legal team, that she provide a written statement about her employment with Redflex Traffic Systems,” Kimerer stated.

“Specifically, the Australian Federal Police wanted information on Mr. Higgins and any information about his role in the bribing of John Bills.”

Finley detailed a written complaint about Higgins making a false report on behalf of Redflex to the Australian Stock Exchange.

“I learned that the construction department had been erroneously reporting that certain systems were completely installed when they were not,” she wrote.

“I told this to Higgins because I believed the erroneous information would skew the company’s half-year financial results. But before I could finish, Higgins cut me off.”

Finley’s sentencing next month stems from her role in bribing officials in Chicago, Illinois.

Last month, Chicago’s former Deputy Transportation Commissioner, John Bills, was sentenced to a decade in federal prison after taking $2,032,959 in bribes from Redflex of Australia, although his attorneys filed an appeal last month.

Bills convinced Redflex to hire unemployed friend, Martin O’Malley, to deliver cash in exchange for his help landing the red light camera contract in Chicago, the most lucrative in the country.

Martin O'Malley pleaded guilty to charges in Chicago, admitting his role as the bagman in Redflex Traffic Systems bribery scam.

Martin O’Malley pleaded guilty to charges in Chicago, admitting his role as the bagman in Redflex Traffic Systems bribery scam.

US District Judge Virginia M. Kendall sentenced O’Malley to six months in prison last month.

Bills had developed a kickback scam he imagined would be untraceable.

O’Malley earned a $60,000 per year salary from Redflex, although he received bonus checks on a regular basis that were meant for Bills. When Bills wanted money, he’d send O’Malley an email, asking him to meet for lunch at a local restaurant. If he wrote he wanted to discuss a “five page” memo, that meant to bring $5,000 in $100 bills to bribe Chicago officials. If he wrote he wanted to discuss an “eight page” memo, that meant $8,000.

All deliveries were kept under 10 to avoid scrutiny for money laundering.

O’Malley’s family pleaded with Judge Kendall, sending letters asking her to go light on the 75-year-old,  40-year active member of Alcoholics Anonymous and Army Veteran whose wife was undergoing treatment for terminal cancer.

“I stand before you as an admitted felon. Guilty as charged,” O’Malley told the judge.

The court finally settled on a six month sentence after Judge Kendall rejected the prosecution’s suggestion that home confinement would be sufficient punishment for O’Malley’s part in the brazen corruption scheme at Redflex.

“This case could not have been prosecuted without your testimony,” the judge told O’Malley.

Under John Bills, Redflex Traffic Systems contract in Chicago generated over $500 million at $100 per ticket for the cash-strapped city.

John Bills, a city official overseeing the red light camera program, held a secret meeting with Redflex officials to discuss how to win the Chicago contract, according to a May 2014 criminal complaint.

John Bills, a city official overseeing the red light camera program, held a secret meeting with Redflex officials to discuss how to win the Chicago contract, according to a May 2014 criminal complaint.

Karen Finley had no positive words about her former company saying she had a “misguided sense of loyalty” to Redflex.

“Redflex was a toxic and soul-sucking place to work,” she said.

During her sentencing, Finley begged the court for leniency claiming she suffered from financial hardship, even though she made $500,000 during her three years at the company.

“She was able to get a job in the bakery at Fry’s Market, which paid minimum wage. But once the publicity of her case in Chicago hit newspapers, she was fired,” her lawyer stated to the judge.

In October 2015, PINAC’s Joshua Brown reported the Chicago Tribune sued Chicago Mayor Rahm Emanuel for not complying with public records requests after he refused to release communications about city business conducted through private text messages and emails.

The lawsuit, which can be read here,  sought emails and communications about the red light program, and alleged the mayor used private phones and emails to avoid releasing his correspondence and city business activities to the public.

Aside from the bribery scheme, and kickback scam, yellow light duration times were shortened in order to generate more tickets from people running red lights, which resulted in more tickets.

In April, we reported about a story involving Stephen Ruth, the man dubbed the Red Light Robin Hood after he was arrested for cutting wires to red lights were the yellow light duration times were shortened in order to generate revenue, and again after he was indicted on 17 counts of criminal mischief – one count for every light with cut wires.

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