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UPDATED: Mayor Cannon resigns following arrest on corruption charges

According to complaint, Cannon told undercover agents he could assist in zoning, permit approvals

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To read the complaint, click here.

Patrick Cannon resigned March 26, three months into his term as mayor of Charlotte and hours after he was arrested on charges of corruption, bribery, theft involving federally funded programs, wire fraud and extortion in a Federal Bureau of Investigation sting that dates back to August 2010. The federal criminal complaint charges that Cannon was “soliciting and/or accepting money and other benefits for the use of his public office.”

“The City Council is deeply disappointed to learn of the Mayor’s arrest,” the council said in a prepared statement. “Our thoughts and prayers are with his family.”

Cannon could not be reached for comment.

During the course of an unrelated criminal investigation, according to the complaint, the FBI got a tip from a local law enforcement source working undercover on public corruption that Cannon was allegedly involved in illegal activity. An undercover FBI agent posing as business manager for a venture capital company began meeting with Cannon and other business leaders about conducting business in Charlotte. The agent said he wanted to “test the waters” by opening a nightclub in the city at a property he identified as the “Firehouse.” The property in discussion had parking problems and would require zoning changes, according the complaint.

Cannon and the agent held several meetings about the property where, according to the complaint, Cannon allegedly claimed he had influence over city departments and employees responsible zoning and construction permitting. At a dinner on Dec. 12, 2012, Cannon asked the agent if he’d be interested in investing in a feminine hygiene business Cannon was creating. The agent agreed to provide Cannon a $12,500 zero-return loan in exchange for his assistance with zoning and permit needs for the nightclub property. On Jan. 17, 2013, the complaint alleges, Cannon received the payment in cash and stated that he could help the agent with zoning and permits “up to the top.”

At a press conference at the Charlotte-Mecklenburg Government Center late Wednesday afternoon, none of the City Council members said they had reason to believe that the city’s planning and zoning system had been manipulated illegally.

And in a statement released Wednesday, Mecklenburg County Manager Dena R. Diorio said: “We are reviewing the documents and criminal complaint, and know there are references by Cannon regarding Mecklenburg County’s Code Enforcement process. We are not aware of any connection to the County, but will cooperate fully with any investigation.”

In May 2013, the complaint stated, the undercover agent introduced Cannon to another agent posing as a real estate developer from Las Vegas who was attempting to secure investments from a group of foreign investors to build commercial real estate developments in Charlotte, the complaint reads. The Las Vegas “investor” told Cannon he was interested in development opportunities along the Gold Line streetcar and Blue Line light rail routes.

At the meeting, the agent asked Cannon if he would travel to Las Vegas to help “sell” a group of foreign investors on his business and promote Charlotte as a place where Cannon could “protect their interest as long as he was in office.” At a subsequent meeting, Cannon allegedly proposed a fictitious story to help sell the investors, claiming that he was responsible for the development and construction of the mixed use project the Metropolitan and that he would state he “has used his official position as a City Council Member to clear zoning and permit issues with City and County officials.”

Cannon also raised the issue of his compensation for his part in the scheme, according to the complaint. In exchange for his participation, Cannon received an all-expenses-paid trip to Las Vegas for himself and his wife plus $6,000. At the Las Vegas meeting, four agents posing as foreign investors told Cannon they were interested in investing up to $100 million in Charlotte commercial real estate as long as the Cannon could assist them with their projects.

Even after his election to the mayor’s office, Cannon continued to assist the purported investors with their development plans, according to the complaint. During one meeting Cannon allegedly agreed to provide information on the construction schedule for the Gold Line extension so that the investors could purchase property along the route. Of the federally funded project, Cannon allegedly said, “There’s a pot of money out there that we’re looking to go after and um, some other grants we’re looking at a well. They have these community improvement grants.”

In one final meeting held on Feb. 21, 2014, Cannon was to impress a skeptical investor on the merits of the Gold Line scheme by holding the meeting in the mayor’s office. In return for the meeting, Cannon was given a leather briefcase with $20,000 in cash, according to the complaint.

Following his appearance in federal court, Cannon was released on bond, pending an indictment. The charges concerning theft and bribery charges concerning federally funded programs carry sentences of 10 years in prison and a $250,000 fine. The wire fraud charge carries a maximum sentence of 20 years and a $1 million fine, and the extortion charge also carries a 20-year maximum sentence and a $250,000 fine.

Land-use consultant Walter Fields of the Walter Fields Group, who represents petitioners in rezoning matters, said he has never seen any indication of corruption in his dealings with the city during his career in both the public and private sectors. Fields worked for the Charlotte-Mecklenburg Planning Commission from 1977 to 1997.

“I’ve been doing this stuff for a long, long time and one of the things that has been refreshing about Charlotte is the honesty and transparency of the government process,” Fields said. “I’ve known Patrick Cannon since he was a young man on City Council. My relations with him have always been cordial and professional. I’m very shocked.”

Other land-use consultants that have worked on zoning issues in Charlotte told The Mecklenburg Times that they have seen no evidence of corruption, either.

Two prominent Charlotte land-use attorneys who have acted as agents for some of the largest development projects in the market over the past couple of decades said on Wednesday that they have seen no evidence in their dealings with the city that the planning and zoning system is systematically corrupt.

Neither could point to any decision by the planning staff, Planning Commission or City Council that would suggest Cannon or anyone else had illegally influenced a decision to go any way other than the way it would have gone without undue influence.

Both lawyers said that the layers of decision-making and the multiple processes required in a rezoning case make corruption unlikely if only one elected official is involved.

“There just isn’t an easy mechanism for that to take place, and most of these rezoning decisions are nonpartisan,” one of the lawyers said.

When asked if he has ever had any contact with Patrick Cannon or his staff, the man in charge of the Mecklenburg County building permitting and plan reviewing operations said he had not. “No,” said Jim Bartl, longtime director of the Mecklenburg County Code Enforcement agency. Bartl then said he had to refer all other questions to the county’s public relations and communications department.

The mood at the Government Center was subdued Wednesday and all the members of the City Council – Republicans and Democrats alike – looked shell-shocked and grim.

Wednesday’s meeting of the Planning Commission’s rezoning committee at the Government Center proceeded as usual without any mention of Cannon’s arrest or allegations that he claimed to have influenced or was accused of influencing rezoning decisions.

Payton Guion contributed to this report

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