Feds could expand fraud

probe of Kobie West

 

Federal investigators appear to be poring over the business dealings of insurance executive Kobie T. West in an effort to expand an investigation of fraud that started with the Philadelphia Housing Authority.

The revelation emerged last week in federal court when Judge Joel H. Slomsky, who serves in U.S. District Court for the Eastern District of Pennsylvania, spoke from the bench during a plea hearing for West.

Slomsky referred to a confidential plea agreement entered by West on May 18, in which West told federal investigators that he was “conspiring with another person to provide bribes and kickbacks to persons, including public officials known to the U.S. government, in order to maintain business for West Insurance.”

The judge later added that West was involved in “three to four other areas of cooperation with the government.”

A spokesperson for the Department of Justice said she could not comment on, or even confirm the existence of, such an investigation.

“Everything in the Kobie West case is under seal,” said spokeswoman Patty Hartman. “So, there is nothing public and the practice is, in general, for investigations we don’t comment, confirm or deny.”

However, a source described as a “business acquaintance” of West’s said the insurance broker had deep political connections in the city and that reporters might be surprised at some of the names that emerged from “the shakeup” — hinting that federal authorities have expanded their probing beyond the PHA contracts.

The source declined to elaborate or speak on the record.

West’s company, the West Insurance Agency, a minority-owned firm, did much of its business through political contacts with public agencies.

According to a recent story in The Philadelphia Inquirer, West and his father, the firm’s founder Bernard West, were major political donors, contributing $95,000 to Pennsylvania politicians between 2000 and 2009.

The biggest beneficiary of the Wests’ largesse was state Rep. Dwight Evans, who received more than $38,000 from the father and son while he was the ranking Democrat on the House Appropriations Committee. Other powerful politicians who received money from the pair were: former Gov. Ed Rendell, who received $16,500; former mayor John Street, to whom the pair gave $8,250; and Mayor Nutter, who received $5,000. Two disgraced former legislators also received cash: state Sen. Vincent J. Fumo, who got $4,500, and former House Speaker John M. Perzel, who received $5,000.

It is not the first time West’s business practices have been called into question. West was also named in the federal investigation at City Hall during Street’s tenure as mayor.

That investigation ended with the indictment of the late Ronald White, a friend of Street’s, and the conviction of former City Treasurer Corey Kemp.

On May 18, West pleaded guilty to one count of wire fraud in a plea agreement with federal prosecutors.

He told federal officials that he, with the help of accomplice inside the PHA, created a fake invoice of $2,141,523 for worker’s compensation coverage, then included a commission of $181,202.

A senior vice president at the West Insurance Agency, Edgar Bridges, has been sentenced to two years of probation for tax evasion as part of the investigation into the kickback scheme. He took “bonuses” totaling $65,000 from West while working at PHA and failed to report it on his income tax returns.

Bridges was sentenced last week by Slomsky. In addition to probation, he was fined $5,000.

In March, New Jersey Controller A. Matthew Boxer accused Tribune’s CEO and President Robert W. Bogle, a member of the Delaware River Port Authority’s board from 1997 to 2011, of steering authority business to West’s insurance firm, where Bogle was also a board member. He accused Bogle of steering a no-show contract to West.

The report quoted an email from William Graham of the Graham Company, the DRPA’s Pennsylvania insurance broker of record to Willis Holding Group, its New Jersey counterpart.

“Bob Bogle … and the Board of the DRPA expects these commissions to be paid to the West Agency, or another select MBE (Minority Business Enterprise).”

Bogle pointed to the report, quoting it “or another select MBE” and added, “Bogle never said a word about West.”

The company received $684,254 in commissions, but Boxer’s office was unable to determine what, if any services it provided.

 

Contact staff writer Eric Mayes at (215) 893-5742 or emayes@phillytrib.com.

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