EagleTribune.com, North Andover, MA

January 24, 2013

US Attorney says ex-Methuen official falsified records

Michael McLaughlin charged with falsely reporting his salary while director of Chelsea housing authority

By Mark E. Vogler
mvogler@eagletribune.com

---- — BOSTON — Ex-Chelsea Housing Authority Executive Director Michael E. McLaughlin faces federal charges for falsely reporting his salary in annual budgets required by the U.S. Department of Housing and Urban Development (HUD) and the Massachusetts Department of Housing and Community Development.

The U.S. Attorney’s Office charged McLaughlin, 67, of Dracut, a former Methuen town manager, with four counts of falsifying a record in a federal agency matter, according to documents filed in U.S. District Court yesterday. McLaughlin was forced to resign from the Chelsea Housing Authority last November after it was revealed he had under-reported his salary by $200,000 to state officials.

The information filed yesterday by federal prosecutors alleged that McLaughlin “knowingly concealed, falsified, and made false entries, and caused such concealment and false entries, in records and documents,” namely, the annual fiscal year budgets of the Chelsea Housing Authority from 2008 to 2011, and submitted them electronically to the Massachusetts Department of Housing and Community Development.

McLaughlin falsely stated that his budgeted annual salary was $151,945, when he knew that his actual salary for Fiscal Year 2008 was at least $242,908 under his existing contract, according to the court documents. It is further alleged that McLaughlin made the same kind of concealment of his rising salary in the ensuing three years. Specifically, in Fiscal Year 2009 McLaughlin falsely reported that his budgeted annual salary was $156,503, when he knew that his actual salary was at least $267,199 under his existing contract and his total compensation was at least $292,902, as reflected in his 2008 W-2.

Then in Fiscal Year 2010, McLaughlin falsely reported that his budgeted annual salary was $160,415, when he knew that his actual salary was at least $275,215 under his existing contract and his total compensation was at least $324,896, as reflected in his 2009 W-2. In Fiscal Year 2011 McLaughlin falsely reported that his budgeted annual salary was $160,415, when he knew that his actual salary was at least $283,471 under his existing contract and his total compensation was at least $324,896, as reflected in his 2009 W-2.

If convicted of the charges, McLaughlin could receive a maximum penalty of 20 years in prison, followed by three years of supervised release and a fine of up to $250,000 on each count.

McLaughlin, who served as Methuen town manager for more than two years in the early 1990s, could not be reached for comment. A phone message left at the office of his Boston attorney Thomas M. Hoopes was not returned.

Raised in Billerica and the son of a school custodian, McLaughlin has had a long and controversial career in politics and local government.

He got his start in town politics in the late 1960s. In 1970, McLaughlin, then just 24, was elected state representative. Six years later, he was elected to the Middlesex County Commission, which ran courts, jails, hospitals and work programs. A failed bid for Congress followed in 1978.

In 1979, McLaughlin was named executive director of the Somerville Housing Authority. He would hold the position, in addition to his role as county commissioner, until 1985.

McLaughlin went on to direct the Lowell Housing Authority in 1986. Four years later, board members accused him of politicizing the authority and bought out the remainder of his contract.

Angry Methuen residents called for McLaughlin’s resignation within weeks of his hiring as town manager in February 1990.

Within a month, town councilors had ordered a police investigation into his background and formed a subcommittee to explore a contract buyout.

McLaughlin eventually resigned under pressure from the town council in October 1992. Just a year earlier, he had already come within a single vote of being fired after councilors derided him as “power hungry” and a “ruthless politician.”

McLaughlin has been investigated for wrongdoing numerous times but never indicted, found guilty or charged — until yesterday.

“In all my life in politics, from the Lowell City Council to the U.S. Senate, no one worries me more than Michael McLaughlin,” the late-U.S. Sen. Paul Tsongas, a longtime McLaughlin adversary, once said.

In 1975, McLaughlin was investigated by the Middlesex District Attorney’s office for allegedly pressuring Billerica businesses into making campaign contributions while he was a state representative. The case was eventually dismissed.

In 1978, McLaughlin was called to testify before a grand jury on a county commissioner’s office job-selling scandal in which a former McLaughlin aide was later convicted.

Repeatedly pleading the Fifth Amendment, McLaughlin refused to answer questions about his relationship with his aides and his approval of two courthouse janitor jobs for relatives of high-ranking Boston Mafiosi, including the nephew of former Boston Mafia boss Gennaro Angiulo.

In 1980, McLaughlin was investigated by the state Attorney General for allegedly packing the Middlesex County ballot with straw candidates to increase his changes of winning. McLaughlin denied the allegations and the investigation was later dropped.

In 1987, authorities tape-recorded at least nine conversations between McLaughlin and reputed mobster John R. “Jackie” McDermott, a bookmaker whose phone was wire-tapped as part of a state police and FBI investigation into organized crime in Lowell.

McLaughlin, who was working as Lowell housing director but was in the running for city manager, allegedly asked McDermott to pressure city councilors into picking him for the job.

Stories about the “Bookie Tapes” later made headlines in the Boston media.

McLaughlin, passed over for the Lowell manager job, was never charged with wrongdoing for his involvement with McDermott, who was murdered in Lowell in 1988.