Attorney Liam Scully Defends Ex-Chelsea Housing Director in Federal Court

By Sean P. Murphy
Boston Globe Staff

McLaughlin, 68, began serving his sentence in September after pleading guilty to filing false reports to state and federal regulators to conceal his inflated $360,000 annual salary for running the small housing agency.

In documents filed Friday in US District Court in Boston, McLaughlin indicated he will also plead guilty to charges he conspired to rig federal housing inspections of apartments operated by his authority so the agency would get high marks, even though the apartments overall were poorly maintained.

“The whole Mike McLaughlin saga has been disturbing and has hurt the people the housing authority is intended to serve,” said Thomas K. Standish, who became chairman of the Chelsea Housing Authority’s board of commissioners after McLaughlin was forced to resign in 2011.

“But at least this represents a cleansing that allows us to go forward with new safeguards and better management,” he said.

Under federal sentencing guidelines, McLaughlin’s conviction on the inspection-rigging charges would result in a sentence of between 30 and 37 months.

The office of US Attorney Carmen Ortiz is recommending a 12-month sentence, according to court filings, in apparent deference to McLaughlin accepting responsibility and the government avoiding a trial.

Liam Scully, McLaughlin’s attorney, said the plea arrangement “is the right deal for” McLaughlin and the government. “Both sides had to give something up to make the deal,” he said.

Scully said McLaughlin’s actions in the housing inspections were not done in “bad faith or for personal gain.”

“He took a very aggressive approach to inspections and in the process stepped over the line without realizing the ramifications of his actions,” Scully said.

Scully said McLaughlin relied on a hired consultant to help him anticipate which apartments would be inspected. Federal inspections are supposed to target a couple of dozen units randomly selected from among more than 1,500 units just minutes before inspections began.

But the Globe reported last May, five months before McLaughlin and two others were indicted, that maintenance records showed a suspicious pattern suggesting that McLaughlin knew which apartments would be inspected ahead of time. In the days before an inspection, McLaughlin would bring in an exterminator to spray the apartments that were about to be inspected, but not the apartments adjacent to them.

Besides McLaughlin, also indicted last year were former assistant housing director James H. Fitzpatrick and consultant Bernard Morosco.

Morosco, a certified federal inspector based in Utica, N.Y., allegedly gave McLaughlin and Fitzpatrick confidential lists of apartments that the US Housing and Urban Development officials planned to inspect, according to the indictment.

His attorney said that McLaughlin is not required under the agreement to cooperate in the prosecution of Fitzpatrick and Morosco. A lawyer for Fitzpatrick declined to comment yesterday. Morosco declined to comment when reached by phone.

Even if the federal charges are resolved Monday, McLaughlin will not be free of legal entanglements. He also faces indictment on state charges that he violated campaign laws by soliciting donations, often in cash, for political candidates, including Timothy P. Murray, former lieutenant governor.

Other issues remain for McLaughlin. Upon his resignation, McLaughlin qualified for what would be one of the largest pensions in state history, about $250,000, based on more than 30 years of public service and his salary.

The Chelsea Retirement Board has not yet decided whether McLaughlin should forfeit that pension, based on state law that required forfeiture when a public official is convicted of a crime in connection with his job.

However, in a rare victory for McLaughlin, the board decided last month to let McLaughlin recover the money he contributed toward his pension through payroll deductions, an estimated $250,000. Housing authority officials had asked that they receive the money as restitution for money he wrongly took in salary.

The state commission that overseas local retirement boards is now considering whether to allow the Chelsea retirement board’s decision to stand.

The recommendation that McLaughlin serve an additional year in prison for rigging apartment inspections is scheduled to be heard Monday by US District Court Judge Douglas P. Woodlock, the same judge who sentenced McLaughlin last year.

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