N.J. Mayor resigns after stealing $87K from nonprofit
CAMDEN, N.J. — Atlantic City Mayor Frank M. Gilliam Jr. resigned from office late Thursday after admitting to embezzling more than $87,000 meant to buy school supplies and fund activities for a youth basketball club he co-founded, becoming the latest in a long string of the city’s elected leaders to face possible prison time.
Even as Gilliam, 49, was raising funds for the Atlantic City Starz, an organization he has touted both in his campaigns and his official biography, he was spending donors’ money on luxury clothing, expensive meals and trips that had nothing to do with the underprivileged children the organization was supposed to serve, prosecutors said.
“It is with a heavy heart that I tender my resignation as Mayor of the City of Atlantic City, effective immediately,” Gilliam wrote in a letter time-stamped by City Clerk Paula Galetei at 4:39 p.m., minutes after a police officer had locked up City Hall for the day.
“I would like to apologize to the residents of the Great City of Atlantic City who deserve stability and respect.”
Gilliam left his house, passport in hand, shortly after 7 a.m. and took that well-worn route from Atlantic City to Camden, where he pleaded guilty to one count of wire fraud in a hearing before U.S. District Judge Joseph Rodriguez.
He now faces a potential prison sentence of up to 20 years. The judge informed him that his plea could also mean he would no longer be able to hold public office. Prosecutors said more than $41,000 in cash seized in an FBI raid of his home would go toward restitution.
Gilliam did not resign until hours after his guilty plea and calls from the state’s top officials for him to step down. New Jersey Attorney General Gurbir S. Grewal filed an Order to Show Cause in Superior Court in Mercer County seeking to remove Gilliam from office under the state’s forfeiture of public office statute.
“The residents of Atlantic City deserve immediate action to remove Mayor Gilliam, who demonstrated by his criminal conduct that he is not fit for office,” Grewal said.
New Jersey Gov. Philip Murphy called the charge to which Gilliam pleaded “despicable” and said he “must resign” to make way for a mayor who would focus on the “betterment of Atlantic City and not themselves.”
“He has squandered the trust and confidence of his community and of his administration to lead that community,” Murphy said mid-afternoon, even as a spokesperson for Gilliam was at the door of Gilliam’s seventhfloor office saying he was still the mayor.
“When a scheme depletes charity for children, it’s unconscionable,” said Gregory W. Ehrie, special agent in charge of the FBI’s Newark office, in a statement. “But when the fraud is perpetrated by someone the public trusts, it damages the community’s confidence in their public servants. This defendant betrayed the trust of his community and of people of people who wanted to improve the lives of children.”
Gilliam is a former city councilman elected to lead the cashstrapped casino town in 2017.
In court, Gilliam showed no emotion, responding succinctly to the judge’s questions while his wife, Shawna, sat alone in the front row. She had accompanied Gilliam there from their Atlantic City home.
He was released hours later on a $100,000 unsecured bond pending his Jan. 7 sentencing hearing.
As part of his guilty plea, Gilliam agreed to repay the money he stole from the basketball nonprofit between 2013 and 2018 — in part with more than $41,000 in cash that FBI agents seized from his home last year. Gilliam founded the charity along with former Atlantic City basketball alumnus, Keith Fader, of Margate, in 2011.