New Haven Register (New Haven, CT)
State lawmaker accused of wire fraud
Rep. DiMassa, D-West Haven, charged in connection with COVID funds Judge: DiMassa ‘in treatment’ for gambling addiction
WEST HAVEN — State Rep. Michael DiMassa, D-West Haven, was arrested Wednesday on a federal criminal complaint charging him with one count of wire fraud.
DiMassa, 30, also is an employee for the city of West Haven and a resident of the city.
Assistant U.S. Attorney Ray Miller said the government believes in excess of $636,000 is missing.
DiMassa appeared at 11:30 a.m. before U.S. District Judge Sarah A.L. Merriam in New Haven. He was released. He did not speak to reporters.
The judge said she “understands” DiMassa is “in treatment” for a gambling addiction.
He did not enter a plea and his next court date is scheduled for Dec. 10.
He was ordered to have no contact with any municipal employees of West Haven. He was also ordered to seek employment; Merriam said she does not “believe he will continue in his employment” currently. The court did not impose any location monitoring.
In a statement, federal officials allege that DiMassa and another individual in January formed Compass Investment Group LLC. Then, beginning in February, “Compass Investment Group LLC fraudulently billed the
City of West Haven and its ‘COVID-19 Grant Department’ for consulting services purportedly provided to the West Haven Health Department that were not performed,” the statement says. “From February 2021 through September 2021, the City of West Haven paid Compass Investment Group a
of $636,783.70.”
“It is further alleged that DiMassa made several large cash withdrawals from the Compass Investment Group LLC bank account, some of which were made shortly before or after he was recorded as having made a large cash ‘buy-in’ of gaming chips at the Mohegan Sun Casino,” the statement said.
“On May 7, 2021 Mohegan Sun Patron Gaming records reflect Michael Dimassa executed a cash “Buy-In” of chips for $9,800,” the warrant affidavit notes.
The complaint charges DiMassa with wire fraud, which carries a maximum term of up to 20 years in prison if convicted.
According to court documents made public after DiMassa’s appearance in court, DiMassa was one of two individuals listed as a principal for Compass Investment Group LLC, formed on Jan. 27. The affidavit does not name the other individual.
DiMassa and the unnamed business partner are listed as signatories on a bank account for Compass Investment Group, opened on Feb. 5. An FBI special agent reviewed the bank account from Feb. 5 to April 30 and allegedly found seven checks between Feb. 12 and April 30 made payable to Compass Investment Group from the city of West Haven.
“The checks ranged in value from $11,847.50 to $87,650. These funds were then used for twenty-one cash withdrawals that were conducted by Michael DiMassa, ranging from $8,000 to $10,000, for a total of $178,150,” the affidavit alleges.
The investigator said on May 5, a payment voucher was submitted for $85,595 for “COVID-19 Legal + Lobbying + Site work for COVID-19 Clinic” provided to the city’s Health Department. That invoice listed 305 hours for consulting on legislative review of executive orders, 483 hours of consulting for support staff services, 305 hours for security and 102 hours of consulting for federal lobbying. The next day, a check was issued in that amount to Compass Investment Group by the city.
The day after the check was issued, it was depos ited into the Compass Investment Group bank account and DiMassa allegedly withdrew $8,200. On May 10, 11, 13, 17 and
18, DiMassa made more withdrawals, all between $8,000 and $10,000, according to the affadavit.
On May 7, the day DiMassa reportedly made his first withdrawal from the Compass Investment
Group bank account, investigators said be bought $9,800 in chips at Mohegan Sun; he reportedly made further purchases of chips at Mohegan Sun on May 10, 12, 13, 15 and 17.
On May 19, two weeks after the first payment voucher, an invoice was submitted to the West Haven Health Department for $84,650 for hundreds of hours of “COVID-19 Legal + Site work” that reportedly was performed by Compass Investment Group. The following day, the city issued a check to Compass Investment
Group for $84,650. The day after, the check was deposited into the Compass Investment Group bank account and DiMassa withdrew $9,200.
Investigators allege DiMassa withdrew amounts over $9,000 twice on May 24 and June 1 and once on June 7. On May 21, DiMassa reportedly bought $4,000 in chips at Mohegan Sun, with further purchases of chips made on May 23, 28 and 29.
The investigator said the city’s corporation counsel told officials that the city’s health director “never used, selected, approved, or otherwise engaged Compass Investment
Group for any work or services concerning the West Haven Public Health Department.” As of September 2021, investigators say $636,783.70 was paid to Compass Investment
Group by the city of West Haven.
The FBI recently visited West Haven City Hall.
Federal authorities had not previously said there was a connection to any specific probe ongoing at City Hall.
Mayor Nancy Rossi recently announced that she had found “potentially fraudulent” activity in use of federal CARES Act money.
Rossi has cited an investigation, without specifying who was investigating or what they were investigating, as the reason she could not be more forthcoming with information beyond an announcetotal ment about “potentially fraudulent” activity.
“At least this time we know that it’s definite. It’s hard,” Rossi said Wednesday. “... We have to let the judicial system do their job — and if found guilty, he has to be punished.”
DiMassa has simply been absent from his two City Hall jobs for the past several days, Rossi said.
“Now that he’s been arrested, he’ll be on (paid) administrative leave,” she said. She said she’s required to put him on paid leave and it was not her choice.
Rossi later said, “I want to commend the Federal Bureau of Investigations...on their speedy investigation and arrest” of DiMassa.
If “DiMassa broke the public’s trust and his oath to protect and serve his constituents, and is found guilty of fraudulent activity, I am demanding that he and any other individual(s) involved be held accountable and prosecuted to the full extent of the law. If convicted, all individuals involved should go to jail,” she said in a statement.
“As I stated when I found and reported this probable fraudulent activity, I will update our residents when information becomes available and when it’s (released) will not compromise the ongoing investigation.”
DiMassa, a West Haven resident who works as an administrative assistant for the City Council, was first elected to his state position in 2016.
City Council Chairman Ronald M. Quagliani, D-At Large, said Wednesday, “This is the first confirmation of the federal investigation.”
“We (the council) have been waiting for information,” Quagliani said.
“This is the first time we can confirm there is an active federal investigation and that is a good thing.”
“We still don’t know the facts and circumstances of the arrest and right now the record is sealed,” he said.
In a joint statement, state House Speaker Matt Ritter and Majority Leader Jason Rojas said: “Elected officials are rightly held to a high standard of conduct and trust. Even the slightest hint of wrongdoing bruises that trust.
“We have significant concerns about Rep. DiMassa’s arrest but we don’t have information on the charges or additional details,” the lawmakers said. “We will be monitor- ing this story closely to see when and if more facts emerge. In the meantime we are immediately remov- ing Rep. DiMassa from all committee and leadership assignments.”
DiMassa had served as vice chairman of the Appropriations Committee and as a member of the Judiciary Committee and Executive & Legislative Nominations Committee, according to his legislative profile.
He is a 2009 graduate of Notre Dame High School where he was awarded the “Man of the Year” title, the profile says. DiMassa attended Albertus Magnus College, graduating in 2013 at the top of his class, the profile says.
DiMassa has been a representative on the West Haven Democratic Town Committee on behalf of the city’s 7th District.
City spending on overtime paid to employees with COVID-19 relief funds — in some cases thousands of dollars — also is under review, as the state Office of Policy and Management said it will bring on outside auditors.
OPM Secretary Melissa McCaw announced the move early this month during a meeting of the Municipal Accountability Review Board, a state commission that retains approval authority over the city’s finances in exchange for state funding to help the city reach financial stability.
Some salaried supervisors and managers received thousands in overtime with relief funds, according to DiMassa, who received such a payment. Rossi said the overtime expenditures were appropriate.
According to figures provided by the city for fiscal year 2020-21, the city spent $1.34 million on COVID-related overtime and compensatory payments.
DiMassa has said he received approximately $14,000 above his pay since the start of the pandemic through compensatory time payouts.
Rossi and other West Haven officials have defended how the city spent its allocation of federal COVID-19 funding from the CARES Act, saying an austere City Hall staff rose to the challenge of addressing the pandemic.