IRS building its own case against Broward sheriff
Sheriff Ken Jenne -- the subject of a two-year federal corruption probe -- now has another set of federal agents scrutinizing him.
Posted on Thu, Aug. 09, 2007Digg it del.icio.us reprint or license print email
BY WANDA J. DeMARZO AND JAY WEAVER
As Broward Sheriff Ken Jenne faces the increasingly likely prospect of choosing between a felony plea deal and a possible indictment on charges related to more than $100,000 in unreported income, the Internal Revenue Service is burrowing into his financial records, according to four sources with knowledge of the case.
An IRS agent testified before a federal grand jury Tuesday in Fort Lauderdale about irregularities in Jenne's finances, the sources said. Prosecutors questioned the agent and other witnesses about how Jenne allegedly collected money from sheriff's office contractors and others without reporting it on his recent income-tax returns, several sources said. He also failed to report much of that outside income on his state ethics disclosure forms for 2002-06.
Jenne has long maintained that he committed no wrongdoing.
The U.S. attorney's office, IRS and Jenne's attorney, David Bogenschutz, declined to comment Wednesday.
The sources said IRS agents are assisting prosecutors as they continue to build a case that revolves around possible fraud, obstruction of justice and tax evasion. Jenne is suspected of using his office, which pays a $169,800 annual salary, to enrich himself through private business relationships -- including companies that lease buildings and sell services to his agency.
The sheriff and his attorney are hoping to arrange a plea to a lesser felony so Jenne could limit prison time, according to sources.
Jenne's hopes of pleading to a misdemeanor charge, which would allow him to keep his lucrative pension and law license, were dashed long ago as the grand jury probed deeper into his personal finances, the sources said. If Jenne, 60, pleads guilty to a felony, he will lose his job, his pension and law license.
An ethics professor at the University of Miami School of Law said Jenne's alleged conduct is troubling on two levels.
''Jenne's case is a twin failure of both internal governance controls and personal character,'' said Tony Alfieri, director of the UM law school's Center for Ethics & Public Service. ``That's doubly vexing for the community.''
Jenne's troubles with the law began in April 2005, when Gov. Jeb Bush ordered an investigation by the Florida Department of Law Enforcement following media reports about the sheriff's outside income as a security consultant.
But investigators uncovered more than moonlighting. They learned that he had received money and loans from his two secretaries -- and from a developer and vendors who have earned millions of dollars in business from BSO.
His two secretaries also are believed to have cashed in their accrued vacation and sick days in 2002 and 2004, handing over $10,000 to their boss that was never reported, according to several sources.
On Tuesday, the grand jury also heard from a witness who testified that South Florida developer Philip Procacci asked Jenne in 2002 to do some consulting work on a deal with a Fort Lauderdale-based company that claimed to have a product to remove impurities from oil.
Ara Toroyan, the former finance director for Procacci's Boca Raton-based business, testified about the venture in Louisiana.
Procacci invested almost $1 million in the company, Supertech Products, Toroyan's attorney, Leah Mayersohn, told The Miami Herald.
While Jenne invested no money, he did receive $10,000 from a go-between company, Toroyan told prosecutors. Mayersohn said prosecutors showed her client a copy of the check written to Jenne.
Mayersohn said Jenne was instrumental in helping Procacci get nearly all his money back after the deal failed.
The grand jury, which has been hearing testimony since February, could render a decision within the next few weeks -- unless Jenne cuts a plea deal first, sources said.