Second contractor pleads guilty in Atlanta City Hall bribery case

3:45 p.m Thursday, Feb. 16, 2017 Local
Charles P. Richards, Jr. pleaded guilty to conspiracy to commit bribery Thursday in federal court. He is the second contractor to plead guilty in the bribery conspiracy that has gripped Atlanta City Hall.

Federal prosecutors snared a second conviction Thursday in their investigation into the Atlanta City Hall bribery conspiracy.

Lithonia construction contractor Charles P. Richards Jr. pleaded guilty to conspiracy to commit bribery and admitted to paying at least $185,000 in exchange for city contracts from 2010-15. Those contracts included roadwork and building sidewalks.

Richards’ guilty plea joins that of Atlanta contractor Elvin “E.R.” Mitchell, Jr., who on Jan. 25 admitted to a single count of conspiracy to commit bribery and launder money, and to paying more than $1 million for contracts.

Both men will be sentenced April 28.

Mitchell and Richards conspired over several years to win millions of dollars worth of city construction contracts, according to the U.S. Attorney’s Office. They have admitted to paying the money to an unnamed person under the belief that portions would be shared with city officials who exerted influence over contract awards.

Defense attorney Lynne Borsuk said Richards entered into the scheme in the wake of the Great Recession, in an attempt to save his construction company from bankruptcy.

More than 1 million records were released.

“The services Mr. Richards provided to the city were genuine services,” Borsuk said. “He did a wrongful thing … [but] he was in fear of his company going under and his employees losing their jobs.”

Borsuk also said it was Mitchell who approached Richards with the idea of the bribery scheme. Mitchell’s attorney, Craig Gillen, did not immediately respond Thursday to an email asking for a reaction to that statement.

“His business partner came to him with this idea,” Borsuk said. “He should not have said yes. He is deeply remorseful.”

Borsuk said the charges related to regularly-awarded contracts and emergency work that does not go through a competitive bidding process.

Contracting records reviewed by The Atlanta Journal-Constitution this week shed more light on Richards’ work for the city and his business relationship with Mitchell.

Over the years of the bribery scheme, Richards’ company performed work on at least four major contracts with the city.

One of those contracts was amended 20 times over six years.

Prosecutors alleged that Richards paid $127,000 in bribes in 2013, 2014 and 2015 — a time frame in which he bid on, or had extended, three of the contracts reviewed by the AJC.

Cascade Building Systems LLC, one of Mitchell’s companies, was Richards’ minority subcontractor on all of the work, according to the records reviewed by the AJC.

The four contract awards to Richards’ company totaled at least $8.8 million, the records show. The share to Mitchell’s company, based on percentages outlined in Richards’ bid documents, was at least $3.4 million.

In addition, C.P. Richards Co. was authorized to receive at least $2 million in city payments for emergency work, bringing the company’s total during the bribery scheme to at least $10.8 million, according to a spreadsheet of purchase orders approved for the company.

Records reviewed by the AJC do not show if Mitchell’s company was a subcontractor for the emergency work.

In a separate analysis of payment data to Atlanta vendors, the AJC found that Mitchell’s company, Cascade Building Systems, earned $7.3 million in emergency contracts, mostly for work in response to winter storms in 2011 and 2014.

By far the most lucrative deal for both men was the city’s contract for repairing sidewalks, and the records reviewed by the AJC offer some clues as to how they came to do business together.

The records also reveal that Richards, 64, got his foot in the door at City Hall during the waning months of former Mayor Shirley Franklin’s second term.

Atlanta’s public works agency advertised the sidewalk contract in 2009, and 16 contractors showed up for a pre-bid conference in April. Representatives for both Richards Construction and Cascade were in the room, according to records.

Cascade did not bid on the sidewalk contract, but emerged as the sole minority subcontractor in Richards’ bid. Eight months earlier, in November 2008, the city’s office of contract compliance certified Cascade as both an African American Business Enterprise and a Female Business Enterprise.

Charles P. Richards Jr. is accused of conspiracy to commit bribery in order to obtain city of Atlanta contracts, according to charging documents made public in U.S. District Court.

Mitchell listed the company in his mother’s name to qualify as a Female Business Enterprise, records show. The dual designation was significant, as it earned the company extra points in the competitive bid scoring.

In Richards’ bid, Cascade said that it had previously worked on a playground and parking lot in Cuthbert, a bank in Griffin and done sidewalk work for a private company in Atlanta.

The project manager Richards listed in his bid had previously worked for another one of Mitchell’s companies, on a city contract at the airport.

Neither Richards nor Cascade indicated that they had done any previous work for the city.

Nine companies ultimately bid on the sidewalk contract in early June 2009, and the city initially declared two bidders non-responsive, leaving Richards and six others in contention.

Richards’ bid of $7.6 million was the highest of the remaining seven, with $2.9 million, or 38 percent, pledged to Cascade. But by August, the city had eliminated two other bidders, leaving just five.

Those five, including Richards, received shares of the city work in awards that ranged from $600,000 to $1.5 million.

City officials initially recommended Richards’ company be given $661,540 in work, but by mid-November they had already increased that amount to $784,690.

Over the next six years, city officials amended Richards’ contract 20 times, including 14 times in which it added new work and new funding.

By late 2015, awards to the company from the original 2009 contract totaled at least $5.9 million, according to the records, with Cascade’s share amounting to about $2.5 million, based on Richards’ representation that Cascade would receive 38 percent of the work.

Other contracts that Richards’ company won with Cascade as a subcontractor included construction work on Greenbrier Parkway in 2013, for a total award of $2.3 million; streetscaping work on Headland Drive for a total award of $509,000 in 2013 and 2014; and improvements to the intersection of Cambellton and Barge roads in 2011 for a total of $143,380.

Cascade’s share of those contracts ranged from 15 to 32 percent, according to the records.

As part of their pleas, both Richards and Mitchell have agreed to cooperate with the investigation and to testify in future court proceedings in exchange for a possible reduction in their sentences.

Channel 2's Richard Belcher says the contractor who pleaded guilty to bribery is not the only one who has profited from no-bid contracts.

John A. Horn, U.S. Attorney for the Northern District of Georgia, would not comment when asked who is the middle person allegedly delivering the bribes to city officials. He also declined to comment when asked how many city officials were involved, and when they might be charged.

“Today’s plea adds a layer of understanding to the conspiracy identified weeks ago,” Horn said. “Because this matter is still pending, I can’t comment further.”

Borsuk said before becoming part of the conspiracy, Richards had a “lifetime of good works and good deeds.”

“When one of his partners asked him to pay to play, he said yes,” Borsuk said. “That was wrong. He regrets that and he’ll regret that for the rest of his life.”

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