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Kids for Cash Scandal from Wikipedia, the Free Encyclopedia Kids for cash scandal From Wikipedia, the free encyclopedia The "kids for cash" scandal unfolded in 2008 over judicial kickbacks at the Luzerne County Court of Common Pleas in Wilkes- Barre, Pennsylvania. Two judges, President Judge Mark Ciavarella and Senior Judge Michael Conahan, were convicted of accepting money from Robert Mericle, builder of two private, for-profit youth centers for the detention of juveniles, in return for contracting with the facilities and imposing harsh adjudications on juveniles brought before their courts to increase the number of residents in the centers.[1][2] For example, Ciavarella adjudicated a substantial number of children to extended stays in youth centers for a variety of offenses as trivial as mocking a principal on Myspace, trespassing in a vacant building, and shoplifting DVDs from Wal-Mart.[3] Ciavarella and Conahan pleaded guilty on February 13, 2009, pursuant to a plea agreement, to federal charges of honest services fraud and conspiracy to defraud the United States (failing to report income to the Internal Revenue Service, known as tax evasion) in connection with receiving $2.6 million in payments from managers at PA Child Care in Pittston Township and its sister company Western PA Child Care in Butler County.[4][5] The plea agreement was later voided by a federal judge, who was dissatisfied with Luzerne County Courthouse in Wilkes- the post-plea conduct of the defendants, and the two judges charged subsequently withdrew their guilty pleas, raising the Barre, Pennsylvania possibility of criminal trials.[6] A federal grand jury in Harrisburg, Pennsylvania returned a 48-count indictment[7] against Ciavarella and Conahan including racketeering, fraud, money laundering, extortion, bribery, and federal tax violations on September 9, 2009.[8][9] Conahan entered a revised guilty plea to one count of racketeering conspiracy in July 2010.[10] In a verdict reached at the conclusion of a jury trial, Ciavarella was convicted February 18, 2011 on 12 of the 39 counts he faced.[11][12] Following the original plea agreement, the Pennsylvania Supreme Court ordered an investigation of the cases handled by the judges and following its outcome quickly overturned several hundred adjudications of delinquency in Luzerne County.[13] The Juvenile Law Center filed a class action lawsuit against the judges and numerous other parties, and the state legislature created a commission to investigate the wide-ranging juvenile justice problems in the county.[14][15] The Center has maintained a list of related court documents.[16] Contents 1 Investigations 2 Charges and pleas 3 Criminal verdicts and sentences 4 Victim lawsuits 5 Interbranch Commission on Juvenile Justice 6 In popular culture 7 See also 8 References 9 External links Investigations The Pennsylvania state Judicial Conduct Board received four complaints about Conahan between 2004 and 2008, but later admitted it failed to investigate any of them, nor had it sought documentation regarding the cases involved.[17] The FBI was tipped off about Conahan and nepotism in the county courts in 2006.[18] An additional investigation into improper sentencing in Luzerne County began early in 2007 as a result of requests for assistance from several youths received by the Philadelphia-based Juvenile Law Center. Attorneys from the center determined that several hundred cases were tried without the defendants receiving proper counsel. In April 2008, the Center petitioned the Pennsylvania Supreme Court seeking relief for alleged violation of the youths' civil rights. The application of relief was later denied, then reconsidered in January 2009 when charges of corruption against the judges surfaced.[19] The Federal Bureau of Investigation and the Internal Revenue Service also investigated the two judges, although the exact dates and scope of the investigations by the two federal agencies were not made public.[20] Part of the investigation was revealed to have occurred during disciplinary hearings over the conduct of another former Luzerne County judge, Ann H. Lokuta.[21] Lokuta was brought before the Judicial Conduct Board of Pennsylvania in November 2006 to answer charges of using court workers to do her personal bidding, openly displaying bias against some attorneys arguing before her, and publicly berating staff to cause mental distress.[22] The board ruled against Lokuta in November 2008, and she was removed from the bench. During the course of the disciplinary hearings, Lokuta accused Conahan of bullying behavior and charged that he was behind a conspiracy to have her removed.[23] Lokuta aided the federal investigation into the "kids for cash" scheme prior to the determination of the disciplinary board, and a stay order was issued in March 2009 by the state Supreme Court in light of the ongoing corruption investigations, halting Lokuta's removal and the election that was to be held in May to replace her.[24] During the Lokuta hearing, Conahan testified that there were no social relationships amongst the county judges. However, Judge Michael Toole, who was later convicted of case fixing, as well as another judge, had each stayed at a Florida condo jointly owned by Conahan and Ciavarella.[18] The state Supreme Court decided to uphold Lokuta's removal from the bench in January 2011, finding she had received a fair trial, regardless of Conahan's testimony. It also ordered the expungements of the records of 2,401 of those juveniles who were affected.[25][26] Charges and pleas A statement from the office of the United States Attorney for the Middle District of Pennsylvania outlined the charges against the two judges on January 26, 2009. The charges outlined in the information[27] described actions between 2000 and 2007 by both judges to assist in the construction and population of private juvenile facilities operated by the two Pennsylvania Child Care companies, acting in an official capacity in favor of the private facilities over the facility operated by Luzerne County.[20] The U.S. Attorney charged that in 2002 Conahan, who at the time was President Judge of the court, used his authority to remove funding for the county-operated facility. The judges were alleged to have received "millions of dollars" in payments for the completion of a binding agreement between the court and the private facilities, co-owned by attorney Robert Powell, to use their services and the subsequent closing of the county facility.[28] The methods used to conceal the payments involved several parties and transactions which resulted in allegations of tax evasion against the two. Ciavarella and Conahan were also charged with "Ordering juveniles to be sent to these facilities in which the judges had a financial interest even when Juvenile Probation Officers did not recommend placement," according to the statement.[28] Original, negotiated plea agreements called for both judges to serve up to seven years in prison, pay fines and restitution, and accept responsibility for the crimes.[1] However, on July 30, 2009, Judge Edwin M. Kosik of Federal District Court in nearby Scranton rejected the plea agreement, citing "post-guilty plea conduct and expressions from the defendants" that he ruled did not satisfy the terms of the agreement. Kosik wrote that Conahan and Ciavarella continued to deny their crimes even in the face of overwhelming evidence, and therefore did not merit sentences that were well below federal sentencing guidelines.[29][30] Attorneys for the two judges brought a motion requesting reconsideration of the judge's rejection of the plea agreement.[31] The motion was denied on August 24, 2009, and Ciavarella and Conahan subsequently withdrew their guilty pleas, an action which eventually resulted in a jury trial for Ciavarella and additional charges against the former judges.[6] Following the plea withdrawals, on September 9, 2009, a federal grand jury in Harrisburg, Pennsylvania returned a 48-count indictment[7] against Ciavarella and Conahan including racketeering, fraud, money laundering, extortion, bribery, and federal tax violations. Both judges were arraigned on the charges on September 15, 2009.[8][9] Ciavarella and Conahan entered pleas of not guilty on all counts and remained free on $1 million in bail, despite federal prosecutors' contentions that their bail should be raised. Prosecutors argued the judges' bail should have been higher, since they faced the possibility of substantially more prison time and there had been evidence of attempts made to shield assets.[32] Robert Powell, an attorney and co-owner of the two juvenile facilities at the heart of the scandal, pleaded guilty on July 1, 2009, to failing to report a felony and being an accessory to tax evasion conspiracy, in connection with $770,000 in kickbacks he paid to Ciavarella and Conahan in exchange for facilitating the development of his juvenile detention centers.[5][33][34] The Pennsylvania Supreme Court temporarily suspended Powell’s law license on September 1, citing his criminal conviction.[35] Robert Mericle, the prominent real estate developer who built the two juvenile facilities, pleaded guilty on September 3, 2009, to failing to disclose a felony. Mericle had failed to tell a grand jury he had paid $2.1 million to Ciavarella and Conahan as a finder's fee. As part of his plea, Mericle agreed to pay $2.15 million to fund local children's health and welfare programs. Mericle faced up to three years in prison and a $250,000 maximum fine.[36][33][37][38] Mericle was released from federal custody in 2015 after
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