NOLA City Councilman Pleads Guilty Today in Katrina Fraud
A New Orleans District E City Councilman, Jon D. Johnson, has pleaded guilty to using Federal Emergency Management Agency funds intended to aid the cleanup efforts after Hurricane Katrina back in 2005 to fund his 2007 political campaign.
City Councilman Johnson, 63, faces up to five years in prison and a $250,000 fine for the misuse of federal money intended to help a nonprofit organization, Ninth Ward Housing Development Corporation, after 2005's Hurricane Katrina. He agreed to plead guilty to using the FEMA money for his campaign and to filing a false statement on an SBA loan. He also said Wednesday after three decades of service to the city, that he would step down from his council seat.
He pleaded guilty to conspiracy to commit theft of government funds and to submit false documents. Federal prosecutors are investigating the exact amount involved in the theft, but they expect it to be in the thousands. Johnson's sentencing is set for October 25, 2012.
STATEMENT FROM NEW ORLEANS CITY COUNCILMAN JON JOHNSON: "Today July 18, 2012, I will enter a plea to a one count bill of information, charging me with conspiracy to convert federal funds and to file a false statement with a government agency. For some time now, I have been aware that there was an investigation being conducted by the federal government regarding two non-profit organizations -- 9th Ward Housing Development Corporations and the New Orleans Health Corporation, which I have been assisting as an unpaid manager following hurricane Katrina. My attorney, Julian Murray, was advised by the assistant US attorney that the government would be seeking charges against me relative to my activities in working with these two corporations which received federal funds as a result of the storm damage. Believing I had done nothing wrong and to the contrary having large sums of my personal money and having devoted thousands of volunteer hours to these two charitable organizations, I requested a meeting with US Attorney Jim Letten. While they acknowledged the positive contributions I have made, they were able to show me documentation where on two occasions I converted federal FEMA funds totaling $13,000 to use in my 2007 senate campaign, and where I filed a false statement in connection with an SBA loan which I was seeking. I acknowledge that I was, in fact, guilty of those offenses and accordingly agreed to enter a plea and to resign my position as a city councilman. I am hopeful that when all the facts are known, it will be found that my positive efforts to help these two charitable organizations, my many civic activities and my years of honest service to my city and state outweigh my transgressions. The actions in question took place during the years I was a private citizen and not serving in any public office or as an elected official."
The City Council plans to meet in a special session this afternoon at 4 p.m. to declare a vacancy and arrange a special election for November 6th to fill the position.