By Ian Round
Capital News Service
Former Baltimore Mayor Catherine Pugh pleaded guilty Thursday to four of the 11 counts against her related to the sales of “Healthy Holly” children’s books.
At the U.S. District Court in Baltimore, Pugh pleaded guilty to conspiracy to defraud the United States, conspiracy to commit wire fraud and two counts of tax evasion. She pleaded not guilty to seven counts of wire fraud.
Pugh, 69, resigned as mayor in May after the Baltimore Sun reported on questionable sales of her “Healthy Holly” children’s book series to entities doing business with the city and state.
She admitted to accepting hundreds of thousands of dollars for her books, which in many cases she fraudulently double-sold, did not deliver to the purchaser or used for herself, according to federal authorities. She used the money to fund her mayoral campaign, pay down loans and buy property in Baltimore’s Ashburton neighborhood, the indictment said. She hid how much she earned in order to pay less in taxes.
Robert K. Hur, the U.S. Attorney for the District of Maryland, told reporters outside the courthouse after the arraignment Thursday that Pugh had engaged in a “complex and sophisticated fraud scheme.”
Hur said the victims were the purchasers of the books. Among them is the University of Maryland Medical System, on whose board Pugh sat until March. The system paid her $500,000 for 100,000 books in the “Healthy Holly” series, and many of those books never left warehouses.
Pugh faces a maximum prison sentence of 35 years for the four counts to which she pleaded guilty, although Hur said he would only seek a five-year sentence. The seven counts of wire fraud—to which she pleaded not guilty—carry maximum sentences of 20 years each.
Pugh spoke quietly and answered “I do” to most of Judge Deborah K. Chasanow’s questions about her understanding of the charges. Chasanow asked Pugh to repeat herself at least twice.
“How are you feeling today?” the judge asked.
“Anxious,” Pugh said.
Baltimore Mayor Bernard C. “Jack” Young said Wednesday he was “heartbroken and disappointed” by the news of the indictment, but declined to comment on today’s plea through his press secretary on Thursday.
“The City, primarily under Mayor Young’s leadership, has undertaken a number of ethics reforms in the wake of this scandal,” Young’s press secretary, James Bentley, told Capital News Service in an email.
Young was City Council president when the city’s legislative body passed multiple bills related to ethics and transparency this year, then signed them into law when he became mayor.
Those bills increased protections for whistleblowers and required greater transparency and financial oversight.
Pugh is scheduled to be sentenced Feb. 27.
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