Wednesday, 21 August, 2019

Federal investigators execute search warrants at Baltimore City Hall and mayor's residences

Mayor Catherine Pugh offers background on her Healthy Holly book business and the healthy lifestyle baby products she promoted during a City Hall press conference FBI, IRS agents search Baltimore Mayor's homes, City Hall
Patty Aguilar | 27 April, 2019, 22:31

Pugh recently returned $100,000 to the medical system and canceled her book deal.

In recent weeks, Pugh's fractured administration has staggered from one crisis to another.

Pugh announced her indefinite leave of absence from City Hall on April 1, the same day Maryland's governor asked the state prosecutor to investigate her "Healthy Holly" book deals, including $500,000 in bulk sales to a hospital network.

Pugh and five of her staffers are now on paid leave amid a scandal over her book sales. She also sold them to the University of Maryland Medical System, where she held a seat on the board of directors. The Sun reported that other companies looking to do business with the city also cut checks to Pugh for her books.

The federal case comes amid a criminal investigation by the state prosecutor's office, which began at the request of Republican Gov. Larry Hogan, as well as probes by the Baltimore Inspector General, a city ethics board and the state insurance commission. "Mayor Pugh has lost the public trust. She is clearly not fit to lead", Hogan declared in a statement Thursday.

Political analysts say Pugh's biggest bargaining chip with her investigators is her refusal to resign from the mayor's office.

Pugh remained out of sight Thursday, continuing her almost month-long silence.

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Acting Baltimore Mayor Young "would hate to see" Mayor Pugh return from her leave of absenceActing Baltimore Mayor Bernard C. "Jack" Young says he is frustrated he doesn't know more about Mayor Catherine Pugh's plans to return from a leave of absence.

The FBI confirmed to CBS News, the BBC's USA affiliate, that it is working with the Internal Revenue Service (IRS), America's tax-collection agency, on the inquiry into Ms Pugh's book sales.

But City Council member Brandon Scott said an exhausted Baltimore has had enough. Maryland's chief accountant called Pugh's "self-dealing" arrangements to sell her books as "brazen, cartoonish corruption". Yet only a conviction can trigger a mayor's removal from office, according to the city solicitor. In 2009, Mayor Sheila Dixon was charged with using at least $2,000 in donated gift cards for Target and Best Buy to buy a digital camcorder, a PlayStation 2, an Xbox 360 and other electronic devices for her personal use and failing to disclose her trips to New York, Chicago and other places with a prominent developer, as chronicled by The New York Times.

Dave Fitz, an Federal Bureau of Investigation spokesman, confirmed to the local paper that search warrants were being executed at those locations Thursday morning.

"It's very disappointing to have somebody that we personally elected to do this to us", Smith said outside City Hall, where she lingered to share her exasperation.

Young had previously placed the three on paid leave - a move that was made immediately after the Baltimore Business Journal published an April 8 story about their involvement in the Maryland Center for Adult Training (MCAT).

Pugh became mayor in late 2016.

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