The U.S. Attorney’s Office Eastern District of Pennsylvania released the below information:
PHILADELPHIA
– United States Attorney William M. McSwain announced that two brothers, Leo
and Paul Dignam, were charged by Information with fraud and embezzlement, and a
third person, Barbara Conway, was also charged by Information with theft.
Leo
Dignam, 61, of Philadelphia, PA, was charged with two counts of wire fraud and
one count of embezzling from a program receiving federal funds. Leo’s brother,
Paul Dignam, 58, also of Philadelphia, was charged with one count of mail fraud
and one count of embezzling from a program receiving federal funds. Barbara
Conway, 61, of Drexel Hill, PA, was charged with one count of theft of funds
from a program receiving federal funds. At the time of the charged offenses,
Leo and Paul Dignam were senior officials with the City of Philadelphia, and
Conway was the Food Voucher Coordinator for the Philadelphia Health Management
Corporation (PHMC), an agency contracted by the City to manage the Food Voucher
Program.
Leo
Dignam was an Assistant Managing Director in the Managing Director’s Office
and, prior to serving in that position, was the Deputy Commissioner for
Programs with the Philadelphia Parks and Recreation (“PPR”) Department. In
these positions, he oversaw the administration of major events in the city,
such as the Philadelphia Marathon, the Broad Street Run and the Mummers Parade.
Mr. Dignam worked for the City of Philadelphia for approximately 38 years.
Over
the course of several years, from 2012 through 2019, Leo Dignam allegedly
engaged in a scheme to defraud the City of Philadelphia of approximately
$150,000 by misusing two bank accounts he controlled on behalf of the City that
existed to support the work of PPR, namely, recreational activities for
citizens. In particular, he opened a bank account purportedly to support the
activities of PPR in connection with a non-profit organization, the Junior
Baseball Federation (“JBF”). The JBF partnered with the Philadelphia Phillies
to raise most of its funds through the sale of tickets for Phillies games.
Instead
of using the JBF bank account solely for its intended public purpose, Leo
Dignam allegedly misused the account by converting funds from the account to
pay for personal expenses he incurred on an American Express (“AMEX”) credit
card that he opened in connection with the JBF account. He used the AMEX card,
and shared it with family members, for purchases from retail stores, grocery
stores, pharmacies, gas stations, online retailers and service providers, and
other businesses. He then used the funds in the JBF bank account to pay off the
personal expenses on the credit card.
According
to the Information, he similarly misused another account that was created for
the benefit of PPR and the citizens of Philadelphia, the Program Advisory Fund
Account. The defendant used this account to pay personal expenses by
transferring funds directly to a personal account, solely for his own benefit,
and by using it to pay personal expenses on a Verizon Wireless Account.
Paul
Dignam was the Regional Manager for the South Region of Philadelphia Parks and
Recreation. In this position, he oversaw the administration of local recreation
centers and playgrounds and supervised the activities of several PPR district
managers. In 2011, Paul Dignam opened a bank account that purported to be for
use by a recreation advisory council, a commonly used governance structure in
PPR that exists to support local recreation centers and playgrounds by helping
to raise funds, develop programs, and maintain play sites.
Beginning
in 2012 and continuing through 2019, he allegedly misused this bank account by
repeatedly writing checks on the account made payable to himself. He helped
conceal this fraud by having bank statements mailed to his personal residence
and having another individual act as a signatory on the account. The defendant
then forged the other individual’s signature on the misappropriated checks and
falsely noted in the memo line of the checks that they were “reimbursements”
for expenses he incurred by making purchases on behalf of PPR. In sum, Paul Dignam
wrote himself approximately 102 checks worth approximately $119,000.
Finally,
Barbara Conway was the Food Voucher Coordinator for the Philadelphia Health
Management Corporation (PHMC), an organization contracted by the City to manage
a Food Voucher Program designed to provide emergency assistance to people
living with HIV/AIDS. This initiative is funded by the Ryan White HIV/AIDS
Program, a federal program that provides grants to states, cities, counties,
and other local organizations to fund care and treatment services for
individuals living with the disease.
The
Information alleges that beginning in 2015 through 2019, Conway stole more than
$39,000 worth of food vouchers intended for HIV/AIDS patients receiving
services through the Food Voucher Program.
“All
three of these defendants allegedly made the same bad choice to steal funds
from federally-funded programs,” said U.S. Attorney McSwain. “Further, in all
three cases, the defendants stole money from programs designed to benefit
groups that desperately needed the assistance – from patients struggling with
HIV/AIDS who require emergency assistance to meet basic necessities to a youth
baseball organization serving many underprivileged children. The callousness
that the defendants displayed by stealing from these programs is stunning.”
“We
share a collective and long-standing devotion to integrity in City government,
and I wish to thank the United States Attorney’s Office and the FBI for their
partnership in the investigation of the Dignam brothers and our broader
mission,” said City of Philadelphia Inspector General Alexander DeSantis.
“Further, the Conway case shows our continuing commitment to root out fraud and
corruption in all forms, including by employees of city contractors involved in
programs that affect some of Philadelphia’s most vulnerable populations.”
If
convicted, Leo Dignam faces a maximum possible sentence of 50 years in prison,
Paul Dignam faces a maximum possible sentence of 30 years in prison, and
Barbara Conway faces a maximum possible sentence of ten years in prison.
All
three cases were investigated by the Federal Bureau of Investigation and the
Philadelphia Office of the Inspector General. The cases of Paul and Leo Dignam
are being prosecuted by Deputy United States Attorney Louis D. Lappen, and the
case of Barbara Conway is being prosecuted by Assistant United States Attorney
Richard Barrett.
An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
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