On Friday, Houston Mayor John Whitmire and outgoing Harris County District Attorney Kim Ogg announced felony charges for three people related to a finance scheme at the Midtown Redevelopment Authority, an agency intended to improve Midtown Houston. 

Todd Edwards, the real estate asset manager for the authority, received a first-degree felony charge for abuse of official capacity, using more than $300,000 U.S. government funds for his own benefit, and money laundering with underlying criminal activity being theft and abuse of capacity. Veronica Ugorji and Kenneth Jones, both contractors, were charged with abuse of official capacity and money laundering. 

The group allegedly set up a scheme where they directed money to vendors to maintain vacant lots in Houston’s Third Ward. The vendors were supposed to keep the landscaping maintained, tear down blighted structures, and provide general maintenance. However, the work was never done. In all, the group laundered about $8.5 million and spent it on “flashy cars, nice houses, super living, trips, and pornography,” according to Ogg. 

The scheme was uncovered by two residents, Ed Pettitt and Brian Van Tubergen, who noticed the overgrown lots, looked into the budget and plans for the authority, determined that they were paying to have them maintained, and then showed up to board meetings asking questions. The two, for years, complained to the Midtown Redevelopment Authority, and when the MRA ignored the pair, they went to the city council, which also ignored their pleas.

“The scheme was so unsophisticated that the slightest investigation or second look would reveal a great deal of self-dealing and that just didn’t happen,” said Ogg.

Mayor Whitmire expects this to be just the beginning in uncovering local corruption. “More investigative work will reveal more conflicts. … I hope that everyone who will consider a conflict of interest or criminal activity will realize it won’t be tolerated in my administration. … You will be caught and prosecuted whether it’s a violent crime or a white collar crime.”

Charles Blain

Charles Blain is the president of Urban Reform and Urban Reform Institute. A native of New Jersey, he is based in Houston and writes on municipal finance and other urban issues.