Our Columbus Bureau has broken numerous stories involving the state treasurer’s office, beginning in May 2010 when we detailed then-Deputy Treasurer Amer Ahmad’s ties with bank lobbyist M. Noure Alo. Since then, we have closely followed the cases involving Ahmad, Alo and two other co-conspirators who were part of a kickback scheme run out of the treasurer’s office.
The Scheme
Former deputy state treasurer Amer Ahmad re-wrote the state investment policy and steered trading work to his high school pal, who made $3.2 million off the work and funneled $523,000 back to Ahmad through two other co-conspirators. The FBI asserts that Ahmad wanted half of the $3.2 million in fees.
The Players
Amer Ahmad, former deputy treasurer, Ivy League education, Canton native, pleaded guilty to wire fraud, money laundering and bribery and agreed to $3.2 million in restitution, fled to Pakistan, awaiting extradiction to face sentencing.
M. Noure Alo, Columbus area immigration attorney, Ahmad’s personal friend, his wife worked as Ahmad’s secretary, pleaded guilty to aiding and abetting honest wire fraud services.
Doug Hampton, attended North Canton Hoover High School with Ahmad, served as Ahmad’s personal financial adviser, operator of Hampton Capital Financial Management, pleaded guilty to money laundering, conspiracy to commit bribery and honest services wire fraud.
Joseph Chiavaroli, owner of Going Green Landscapes and Lawn Care, allowed Ahmad to invest $150,000 into his business, pleaded guilty to money laundering.
The Scheme
Former deputy state treasurer Amer Ahmad re-wrote the state investment policy and steered trading work to his high school pal, who made $3.2 million off the work and funneled $523,000 back to Ahmad through two other co-conspirators. The FBI asserts that Ahmad wanted half of the $3.2 million in fees.
The Players
Amer Ahmad, former deputy treasurer, Ivy League education, Canton native, pleaded guilty to wire fraud, money laundering and bribery and agreed to $3.2 million in restitution, fled to Pakistan, awaiting extradiction to face sentencing.
M. Noure Alo, Columbus area immigration attorney, Ahmad’s personal friend, his wife worked as Ahmad’s secretary, pleaded guilty to aiding and abetting honest wire fraud services.
Doug Hampton, attended North Canton Hoover High School with Ahmad, served as Ahmad’s personal financial adviser, operator of Hampton Capital Financial Management, pleaded guilty to money laundering, conspiracy to commit bribery and honest services wire fraud.
Joseph Chiavaroli, owner of Going Green Landscapes and Lawn Care, allowed Ahmad to invest $150,000 into his business, pleaded guilty to money laundering.
Calling him a trusted middleman in a “bold shakedown effort” in the state treasurer’s office, U.S. District Court Judge Michael Watson sentenced M. Noure Alo to four years in federal prison, plus three years of post-release probation and forfeiture of $123,000 that Alo received in bribe money.
A sobbing Alo told the judge: “I can’t believe I was so dumb.”
Alo is one of four players who pleaded guilty to roles in a kickback scheme in the Ohio treasurer’s office. Alo, who pleaded guilty in December of aiding and abetting wire fraud, is the first of the four to be sentenced.
Doug Hampton of Hampton Capital Financial Management in Canton is scheduled to be sentenced Thursday. In August 2013, Hampton pleaded guilty to money laundering, conspiracy to commit bribery and honest services wire fraud. Former deputy state treasurer Amer Ahmad, the scheme mastermind, is awaiting extradition from Pakistan where he has been held since he fled the U.S. in April.
Watson said Alo and the co-conspirators acted with breathtaking gall.
“This was far more than a one-shot deal. And I’m going to constrain my comments because this is an ongoing investigation, but if I knew people like Amer Ahmad and if I knew people like Noure Alo from the time I spent in state government, I don’t want to know that I knew them,” Watson said.
A tearful Alo told Watson that he was “shocked and horrified” by his actions. “I can’t believe I was so dumb. I can’t believe I was so stupid. I can’t believe I was so lacking in judgment and foresight,” he said. He apologized to the court, the state of Ohio, Ohioans, his family members, his former law partner and his father, who immigrated from Syria and became a successful surgeon.
His ex-wife, Walaa Waeda, who worked as Ahmad’s secretary in the treasurer’s office, asked Watson for mercy and told him that their young daughter is ill and going blind.
In deciding the sentence, Watson considered the government’s request for a five-year prison sentence as well as Alo’s cooperation with investigators. “You don’t have to let this define you for the rest of your life, but you do have to pay for your errors in judgment,” Watson told Alo. “This type of behavior undermines honest government with all its failings.”
Ahmad re-wrote the state’s investment policy and steered trading work to Hampton, who made $3.2 million in fees off the work. Hampton then funneled $523,000 in kickbacks to Ahmad using Alo’s law firm and Joseph Chiavaroli’s lawn care business as money laundries.
Chiavaroli, who pleaded guilty to money laundering, is scheduled to be sentenced Dec. 1.
According to FBI testimony, Ahmad and Alo plotted to set up Alo as a lobbyist for companies doing business with the state treasurer. Alo pressed the Bank of New York Mellon and the State Street Bank to hire him. At the time, both banks were seeking contracts with the state treasury to act as custodians of more than $20 billion in public pension assets invested around the world. State Street Bank hired Alo, who had no lobbying experience.
In May 2010, the Dayton Daily News published stories calling into question the ties between Alo, Ahmad and the bank lobbying contract. That triggered an FBI investigation.
State Street Bank disclosed this week in securities filings that it is responding to subpoenas from the U.S. Department of Justice and the Securities and Exchange Commission that seek information on how the bank solicited business from public retirement systems.
“We have retained counsel to conduct a review of these matters, including our use of consultants and lobbyists in our solicitation of business of public retirement plans and, in at least one instance, political contributions by one of our consultants during and after a public bidding process,” the bank said.
The U.S. Attorney’s office has not filed charges related to the Alo lobbying arrangement, though authorities acknowledge the investigation is ongoing. During the probe, FBI agents uncovered the kickback scheme.
It is unclear when Ahmad will return to the U.S. to be sentenced for wire fraud, money laundering and bribery.
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