FBI, IRS raid Baltimore mayor’s office
Governor, city officials calling for Democrat’s resignation over book deals
BALTIMORE — Federal agents raided the homes and City Hall offices of Baltimore’s mayor on Thursday as investigations widen to determine whether she used bulk sales of her self-published children’s books to disguise kickbacks.
The multiple early-morning searches pushed the latest political scandal for Maryland’s largest city to a crescendo after weeks of uncertainty and mounting pressure for Baltimore Mayor Catherine Pugh to step down. The politically isolated firstterm mayor, who has long been an avid runner, slipped out of sight April 1, citing deteriorating health, just as the governor called on the state prosecutor to investigate allegations of “self-dealing” by the Democrat.
Gov. Larry Hogan joined calls for her immediate resignation after news broke of the Thursday morning raids, as agents with the FBI and the IRS criminal division carried boxes of evidence out of her City Hall suite. Agents also scoured her two Baltimore homes, the home of an aide and a nonprofit organization she once led.
The mayor’s attorney, Steve Silverman, said federal agents arrived at his city law firm Thursday morning to serve a subpoena for her original financial records. They were directed to a sequestered area where Pugh’s documents were kept, he said, and they did not seek any attorney-client privileged communications. And University of Maryland Medical System spokesman Michael Schwartzberg disclosed that the medical system received a grand jury witness subpoena seeking documents and information related to Pugh.
Days before announcing her departure on an indefinite leave of absence, Pugh held a hastily organized news conference where she called her no-contract book deals a well-intentioned but “regrettable mistake.”
Others have been less charitable about the murky arrangements that earned $800,000 for her Healthy Holly limited liability company. Maryland’s chief accountant called Pugh’s “self-dealing” book deals “brazen, cartoonish corruption.”
For years, Pugh, 69, had somehow negotiated lucrative deals to sell her Healthy Holly books to customers. She sold $500,000 worth of the illustrated paperbacks to the University of Maryland Medical System, on whose board she sat for nearly 20 years. She also made $300,000 in bulk sales to other customers including two major health carriers that did business with the city.
The revelation of a major federal investigation comes amid a criminal investigation by the state prosecutor’s office, which probes public corruption in Maryland. Other probes include a review by the city ethics board and the Maryland Insurance Administration.
“Mayor Pugh has lost the public trust. She is clearly not fit to lead,” Hogan declared in a statement Thursday. “For the good of the city, Mayor Pugh must resign.”
Pugh remained out of sight Thursday, continuing her nearly month-long silence. Her main spokesman, James Bentley, said he hadn’t spoken with her and doesn’t even know where she is. But Silverman, her lawyer, told reporters he met with her Thursday afternoon to discuss “options” after the court-authorized searches by federal agents. He asserted that a way forward “will be up to her,” but did not offer more specifics.
Silverman also said Pugh is “physically still ill” from a bout of pneumonia and “emotionally extremely distraught” after the searches by FBI and IRS agents.
City Council member Brandon Scott said an exhausted Baltimore has had enough. He reiterated the council’s unanimous demand for her resignation, calling the spectacle of the Thursday raids “an embarrassment to the city.”
But only a conviction can trigger a mayor’s removal from office, according to the city solicitor. Baltimore’s mayor-friendly City Charter currently provides no options for ousting its executive.
Six of Pugh’s staff members joined her on paid leave earlier this month; three of them were fired this week by the acting mayor.