EagleTribune.com, North Andover, MA

December 23, 2012

Inside the Lantigua grand jury

Transcripts of testimony provide insight into mayor probe

By Jill Harmacinski

---- — When William Lantigua became mayor in 2010, his new receptionist ordered a trash truck, two ambulances and a school bus be shipped to the Dominican Republic.

At Lantigua campaign fund-raisers, money was collected for event tickets and raffles and the cash was then handed to mayor’s campaign treasurer, Methuen Police Officer Elvin Alarcon.

And when police workers were ordered by Lantigua’s campaign manager Deputy Police Chief Melix Bonilla to illegally swap 13 seized cars for four, they did it because they felt threatened and intimidated — even though they knew what they were doing was unlawful.

These actions and are others are detailed in testimony provided by witnesses to a state grand jury investigating the Lantigua administration on suspicion of corruption, bid rigging, suspicious out of country travel, and campaign finance violations. The hundreds of pages of transcripts include testimony from Auxiliary Police Chief Jay Jackson, Police Chief John Romero, Police Capt. Roy Vasque, and Bonilla, who pleaded the Fifth Amendment eight times during his testimony.

The transcript of the grand jury testimony was submitted as part of a motion to dismiss the charges of corruption, bribery and fraud against Bonilla for his role in the illegal car swap.

No charges have been brought against Lantigua or other members of his current administration, although other Lantigua allies in City Hall have also testified, including his former Chief of Staff Leonard Degnan, Personnel Director Frank Bonet, Elections Coordinator Rafael Tejeda, Lantigua’s paramour

Lorenza Ortega, and the mayor’s right-hand man, Economic Development Director Patrick Blanchette. Their testimony was not part of the transcript filed Friday. The transcript only contains testimony pertinent to Bonilla.

Degnan also has been charged with extorting the city’s former trash hauler, Allied Waste, to donate the trash truck of Lantigua’s hometown of Tenares in the Dominican.

Here is a look at what some of the witnesses have testified to in the grand jury still seated at Salem Superior Court:

Melix Bonilla

Bonilla went before the grand jury on April 5, 2012, accompanied by his then defense lawyer Frank Mondano of Boston.

He was subpoenaed to testify and also provide the grand jury with documents pertaining to his role as hackney unit supervisor.

Bonilla said for 10 years he oversaw licensing of taxi cab and livery companies for the city. But when prosecutor Michael Patten asked him what his duties and responsibilities were as a hackney unit supervisor, Bonilla repeatedly invoked his Fifth Amendment privilege against self-incrimination.

In total, Bonilla pleaded the Fifth eight times under questioning by Patten.

Under subpoena, Bonilla did provide the grand jury with a variety of documents, including those detailing hackney licenses, livery permits and taxi cab medallions dating back to 2010.

Bonilla was also asked to produce any correspondence between Lantigua or anyone in the mayor’s office pertaining to hackney licenses, livery permits, taxi cab medallions or other matters of business handled by the hackney division.

“The term, correspondence, shall include, without limitation all e-mails, memorandums, text messages, instant messages, notes and voice messages,” said Patten, reading from the subpoena issued to Bonilla.

Bonilla said he produced all documents kept by the police department’s hackney division.

“Are you aware of the existence of any correspondence with Mayor William Lantigua?” Patten asked.

Bonilla pleaded the Fifth.

Patten then asked if he was aware of any correspondence with anyone “employed by or working in the mayor’s office.”

Again, Bonilla pleaded the Fifth.

Patten again asked Bonilla if he’s aware of the “existence of any correspondence” from anyone in the mayor’s office pertaining to or concerning the hackney unit.

Bonilla again pleaded the Fifth.

Bernardo Pena

Pena is the owner and president of Santo Domino Motors, with lots on Haverhill Street and Broadway in Lawrence.

On May 30, 2012, Pena, accompanied by his lawyer Arthur Broadhurst of Methuen, testified he financially benefited from a car swap plan introduced to him by Bonilla in April 2010 — four months after Lantigua took office and Bonilla was promoted by Lantigua from sergeant to deputy chief.

Pena swapped four Impalas he paid $24,780 for at auction for 13 city-owned vehicles seized by police in drug arrests which he later sold for $61,350. Pena said his net profit, after repairing the 13 swap cars, was $24,495.

In one car swapped with the city, Pena said it cost him $2,000 to remove a drug hide compartment from the vehicle. A Cadillac Escalade, previously driven by a drug detective, was spruced up and resold for $12,900. A Lexus sold for $12,300 and Chrysler resold for $11,500, Pena testified. Pena said he’d never done such a car swap deal with the city before.

“That’s what I do for a living, buy and sell cars. And the cars needed a lot of work. They were in very bad shape, but that’s what I do, you know, that’s the best that I do. I used to sell salvage cars, and I’m an expert, you know, in putting cars together and stuff like that,” Pena told the grand jurors.

Around June 2010, after Pena said he had already taken possession of the 13 cars and sold one of them, John ‘Jay’ Jackson, a civilian police department employee in charge of fleet maintenance, along with an appraiser, came to his dealership to inspect the cars and determine their value. At the time, Pena said he talked with Bonilla about the car swap being legitimate.

“You know, right around there, you know, we had a couple conversations that we did nothing wrong, you know, that was a normal procedure that was done here for 20 years, and that’s what it was generally, that’s what he was saying,” Pena testified.

John Dawley, the first assistant district attorney, then asked Pena, “So do I understand your testimony correctly is that Mr. Bonilla said to you that the exchange of vehicles was the normal procedure that had been done?”

Pena answered affirmatively. “That they’ve done it before ... I don’t know if it’s a normal thing ... but they had done it before, that it shouldn’t be a problem,” he said.

Under Dawley’s questioning, Pena also testified that he oversaw the shipment of a trash truck, two ambulances, and a school bus to the Dominican Republic at the request of Jorge Jaime, Lantigua’s former receptionist. Jaime is now a supervisor in the city’s public works department.

Pena said part of his business involves arranging the shipment of vehicles to Santo Domingo through a Linden, N.J., service called Cartaner Ocean Lines. He testified he was paid by the government in the Dominican Republic to ship the truck, ambulances and school bus.

Pena’s cousin in the Dominican Republic would get the check from the Dominican government for the overseas shipment and then wire the money to Pena to pay. Pena denied several times he “advanced” payment for the shipment.

However, Pena did not have any documents with him that day that showed exactly how Cartaner was paid for the shipments.

Pena also told jurors he campaigned for Lantigua, a longtime friend, and had written out checks to his campaign. He also said he sold tickets to Lantigua fundraisers, which were largely held in nightclubs and offered raffles. Pena said when he was paid cash for tickets, he would turn the cash over to Elvin Alarcon, a Methuen police officer who served as Lantigua’s campaign treasurer.

“Did you ever hand the cash to Lantigua himself?” Dawley asked.

“No, no, no,” Pena replied.

Under Dawley’s questioning, Pena said he and his wife travelled to the Dominican in 2009 with Lantigua and his girlfriend Lorenza Ortega, as well as Degnan and his wife Carla. They stayed in Pena’s home there and also at his friend’s and relative’s homes. Pena said they each paid for their own airfares.

On return trips to the Dominican Republic, Lantigua stayed with Pena’s relatives, he said.

John ‘Jay’ Jackson

Jackson is the Lawrence Police Department facilities director and former fleet manager as well as the unpaid auxiliary police chief.

On April 25, 2012, Jackson told grand jurors that shortly after Bonilla was promoted, the newly named deputy police chief called him into his office and said they were going to trade 13 city-owned cars for four Chevy Impalas through Santo Domingo Motors.

Jackson said Bonilla told him this deal “was at the approval of the mayor.”

Jackson testified he told Bonilla the cars couldn’t simply be traded. They had to be advertised and auctioned off — a process Jackson said he had overseen at least 10 times before. But Bonilla, he said, replied “we will do it this way.”

“....and he was adamant about the situation,” Jackson said.

Jackson said Bonilla’s demeanor was “demeaning ... a little bit arrogant and definitely authoritative.” He said he knew Bonilla could fire him. The police department was his sole source of income and health insurance, and after having a heart attack four years prior, Jackson said he didn’t want to lose his insurance.

Prosecutor Michael Patten asked him if it was “fair to say ... you were only pursuing this course of action and going through with this deal, acting under fear that you could lose your job if you disobeyed?”

“Correct,” Jackson replied. He also agreed with Patten that he acted against his better will and judgment.

Jackson said Bonilla called him to his office two weeks later and introduced him to Pena. Bonilla then told him Pena would start taking possession of 13 cars. Jackson said he did not raise any concerns for fear he would lose his job. It appeared “that this was a done deal,” Jackson testified.

A couple of days later, the three met on the fourth floor of a parking garage on Merrimack Street, where the 13 cars had been stored. Bonilla and Pena spoke to each other in Spanish and Jackson, who doesn’t speak Spanish, “backed away some.”

“They were pointing and talking back and forth. I had no idea what they were talking about,” Jackson said.

Pena later came back with a worker and a tow truck and they started taking the cars, he said. Jackson said he had not signed any of the car titles over to Pena and no appraisals or estimates on the cars were taken. He had also not seen the four Impalas the police department was supposed to get in exchange. Within 10 days, all 13 cars are removed from city storage.

“And is it fair to say from the position you’re in, watching this go down, the whole thing stinks,” Patten asked.

“Yes,” Jackson replied.

“And you knew that?” Patten asked.

“Yes. Oh yes ... I was intimidated,” Jackson said.

While the car swap deal was going down, Jackson said his $38,000-per-year civilian job at the police department was cut from 32 to 20 hours. Bonilla had also asked him for captain, lieutenant and sergeant auxiliary police badges so Lantigua could promote three of the unpaid officers. Jackson testified he disagreed with the promotions and also questioned Degnan about his salary and hours reductions.

“And did all of this have an impact, as I said, for you to act against your will and better judgment in facilitating the car swap deal, which you knew was either wrong way to do things and possibly even violated the law?” Patten asked.

“Most certainly,” Jackson replied. “I felt threatened. I felt intimidated. My authority was actually eroding, after being with the actual force for 40 years. I figured, this was the end of it. My pay had been cut. The next would be is — I don’t have a job, and that would be my entire life.”

In late May or early June, the Impalas arrived. Jackson said he went to Santo Domingo Motors and signed over the 13 titles. The cars were swapped and titles transferred but no one had performed appraisals or estimates on the cars’ value, he said. Jackson said that police Chief John Romero was not told of the deal and that he received all orders from Bonilla.

On July 6, 2010, Jackson said he was called into Romero’s office where the chief questioned him on the illegal car swap. It was the first time Jackson said he had spoken to Romero about the swap and the chief orders a certified appraisal done on all 17 cars. Jackson said he went to Edmunds.com to begin the process.

“And this is the first time you actually sat down and tried to figure out the value of the vehicles?” Patten asked.

“Yes,” Jackson said. Jackson estimated the Impalas were worth $28,263, and the 13 other cars were valued at $21,054. Jackson admitted his figures were geared to making the deal look “on the up and up.”

Unsatisfied with the online appraisal, Jackson testified Romero ordered him to get a “real” appraisal from a certified appraiser. Jackson said he went to Wayne Demers at Motta Auto Body in Methuen.

Jackson then admits that he was “backfilling” the deal. He also said he never told Bonilla that Romero was questioning him on the car values.

“... I was in fear that (Bonilla) would probably think that I was trying to backstab him or something, and I didn’t want to get in the middle of it,” Jackson testified.

Bonilla did find out and Jackson said the deputy chief confronted him and got upset.

“He was upset and I just wanted to get out of his office,” Jackson said.

For two years, the Impalas sat unused in a city parking garage. Two were put on the road right before Jackson testified before the grand jury, he said.

Wayne Demers

Wayne Demers is the owner Motta Auto Body in Methuen. On April 19, 2012, Demers testified that two years prior, Jackson came to his business and asked him if he could visit Santo Domingo Motors in Lawrence and give his opinion on the value of 13 cars the city owned and four Santo Domingo Motors owned. The valuations were needed because “they wanted to do a car swap,” Demers said.

“(Jackson) says he wanted it to look like it was a mutual, you know, swap, that the valuations were similar, all right,” Demers testified. “ ... he wanted it to look like the vehicles were a good deal for the city.”

Demers testified he had never done anything like that before for Jackson or the city. Demers said he already knew the deal was done and testified Pena had already sold one of the cars. Demers looked at 12 cars on Pena’s lots and the four Impalas in city storage. A couple of days later, Jackson called him and asked if the appraisals were ready.

Demers testified Jackson said “We don’t need you to get too involved, Wayne. We just need something quick to throw in the file.”

Demers said he just “scribbled something” and gave it to Jackson.

“They already made the deal. No matter what I wrote, didn’t matter,” Demers said, as he was questioned by prosecutor Michael Sheehan.

Demers estimated the Impalas were worth $24,000 to $28,000 and the remaining 13 cars between $18,000 to $26,000.

“And as I think you said before, you had known that the deal had been essentially completed and that your valuation — that one of the cars, was already sold?” Sheehan asked.

“Correct,” Demers replied.

After he testified, a grand juror asked Demers if he asked Jackson why an appraisal was needed if the swap was already done.

Demers replied, “He says they needed something to put in the file that would probably never be opened.”

Another juror asked why Jackson came to him, in Methuen, instead of a shop in Lawrence.

‘My understanding — they were wearing out the shops in the city,” Demers said.

Roy Vasque

Vasque is a captain in the Lawrence Police Department, overseeing the drug, auto theft and fraud, and community policing units.

When Vasque testified before the grand jury on April 30, 2012, he said Bonilla called him into his office in 2010 and spoke to him about the car swap. Vasque said he didn’t “necessarily think it was a good idea.”

Vasque said he asked Bonilla some questions about the deal and “he just said that’s the way we want to do it.”

Vasque said he knew there was a protocol for competitive bidding and auction for the seized cars but he didn’t say anything to Bonilla.

“Why not,” prosecutor Michael Patten asked.

“Well, because he’s my boss and I didn’t want to come off as insurbordinate,” Vasque said.

“So you were — based on what you’re telling us, you had some concerns about mentioning anything further to the deputy chief out of fear that there would be some action against you if you questioned his authority?” Patten asked.

“Yes,” Vasque replied. “My attitude was ... if that’s what he wanted to do, then that’s what he wanted to do.”

Bonilla told Vasque to turn over all the keys to the seized vehicles to Jackson. Vasque spoke with two drug detectives about the keys and Bonilla’s swap plan.

“I told them both just give them what they want and, you know, be done with it. Wash your hands of it. Don’t get involved,” he testified. “... I was worried that if it was going in the wrong direction that I didn’t want them to get caught up in it.”

Patten asked, “And when you say wrong direction, do you mean whether it’s even a lawful arrangement?”

“Correct,” Vasque said.

John Romero

Police Chief Romero testified May 30, 2012. He told grand jurors that in early April 2010, Bonilla sent him a memo about swapping 13 drug forfeiture cars. Romero said he told Bonilla to “explore the idea” and get back to him.

“You simply told him, look into it, explore it and get back to you with what he comes up with?” prosecutor Michael Sheehan asked.

“Correct,” Romero said.

Romero said he had several follow-up discussions with Bonilla about his swap plan between April and July 2010. Bonilla never gave him any details, only saying, “We’re still looking at it,” Romero said.

In July 2010, Romero said Jackson told him the swap with Santo Domingo Motors was a “done deal.”

“ ... He indicated to me that he had already signed over the titles of those 13 cars,” Romero said.

“Under the direction of?” Sheehan asked.

“Deputy Chief Bonilla,” Romero replied.

Romero testified that on July 6, 2010, he instructed Jackson to get appraisals on all vehicles involved in the swap. Jackson did as he asked but Romero said the numbers still didn’t seem right.

“We launched an investigation ... We went to an outside agency and provided them with information regarding this transaction,” Romero said.

“What was that agency?” Sheehan asked.

“The FBI,” Romero answered.