Rep. Mario Biaggi (D-N.Y.), his son and five other men were indicted today on federal racketeering charges in the Wedtech influence-buying scandal that has reached into the highest levels of government.
The veteran congressman and his co-defendants were accused of participating in a scheme that helped transform the Wedtech company from a struggling South Bronx machine shop to a $100-million-a-year defense contractor.
Biaggi was charged with receiving 225,000 shares or 5% of Wedtech stock worth $1.8 million after threatening to have his former law firm sever its ties to the company and block Small Business Administration support.
His son, Richard, a partner in the firm, allegedly accepted the stock on behalf of Biaggi in exchange for securing his help in the company's campaign to win a $32-million Army contract for the manufacture of small engines.
Accused of Demanding $50,000
The congressman also demanded and received $50,000 for the law firm for work lobbying city officials in Wedtech's behalf, the indictment charged.
The other partner in the law firm, retired National Guard Maj. Gen. Bernard Ehrlich, also was charged in the 58-count, 84-page indictment that supersedes previous indictments against several defendants in the case.
Ehrlich pleaded not guilty in February to charges he bribed the chief of the New York National Guard to get him to use his influence in Congress on behalf of Wedtech.
Besides the Biaggis and Ehrlich, the others indicted for racketeering and conspiracy were former Bronx Borough President Stanley Simon, former Small Business Administration Regional Director Peter Neglia, Wedtech founder John Mariotta and Ronald Betso, a retired Brooklyn police officer.
Neglia, described as a key official in pushing Wedtech contracts in New York and Washington, approved extending the company's participation in no-bid, set-aside programs for minority businesses over objections of his staff.
The former SBA chief has charged he was forced out of office because of White House pressure to award the Army contract.