Investigators with both the FBI and IRS have been removing documents from the Greater Pittsburgh Police Federal Credit Union for the past week in connection with an account opened by the office of Pittsburgh police Chief Nate Harper, the president of the credit union's board of directors said this morning.
Frank Amity, a retired city homicide detective, said there have been multiple subpoenas served on credit union CEO Karen Janoski.
Ms. Janoski could not be reached for comment Thursday evening. This morning, a woman who appeared to be a credit union employee at the West End institution told a reporter that Ms. Janoski did not wish to be interviewed.
Mr. Amity said he has not seen the subpoenas.
"They're looking at an account that the chief's office opened up. What they're looking for, they don't tell us. There's just one account, as far as I know," Mr. Amity said. "It's opened by the chief's office, so I don't know what kind of an account they have there. It's not a personal account. There's other names on it."
Asked how he knew the account was connected to Chief Harper's office, Mr. Amity said, "Because it's opened by the people in the chief's office."
When asked about the FBI's visit to the credit union, Deputy police Chief Paul Donaldson said through spokeswoman Diane Richard, "I have no statement to make. It is our position that when a matter/incident is under investigation that no statement will come from the bureau."
Mr. Amity declined to say whether the account in question was active or closed, how much was in it, whose names are on it or who could withdraw money from it. He said he believes it was opened in the past five years. Mr. Amity said multiple people had access to the funds, which he characterized as "not a whole hell of a lot of money, I'll tell you that...It's not tens of thousands."
The 78-year-old financial institution on Chartiers Avenue in the city's Elliott neighborhood functions similarly to a bank with a clientele that includes active police officers.
A source familiar with the investigation told the Pittsburgh Post-Gazette that the visit by federal agents is connected to a subpoena served Monday on the City of Pittsburgh Law Department.
The law department arranged to have federal agents guided Tuesday around Pittsburgh police headquarters on the North Side, where the FBI removed boxes of documents from the bureau's special events and personnel and finance offices. Deputy Chief Paul Donaldson said he believes the FBI is investigating allegations of internal misappropriation of funds involving the police bureau's special events and personnel and finance offices.
Special events handles the coordination of officers' moonlighting. Private employers send the office checks typically made out to the police bureau or the city treasurer. The money includes payment for the officers, which is handled through their payroll department, and a surcharge known as a "cost recovery fee." That surcharge totaled nearly $800,000 last year. The checks are sent to the bureau's personnel and finance office. They are then supposed to be deposited in city accounts.
"We don't know anything. We complied with the subpoena, that's all. They've been in for about a week on and off. They're just giving us different subpoenas for different things," Mr. Amity said. "I don't know what the heck the account was used for."
Mr. Amity said there was a credit or debit card associated with the account.
Asked why he thought investigators were serving multiple subpoenas on a single credit union account, Mr. Amity said he thought investigators were engaged in a "fishing expedition."
"What 's happening is they subpoena one thing, they take that in and check that out. That develops into something else, so they give us another subpoena for another thing," Mr. Amity said.
Mr. Amity was not sure if the subpoena was connected to a federal grand jury investigation.
City Solicitor Daniel Regan this week said the subpoena served on police headquarters was linked to a grand jury investigation.
Mr. Amity said the account appears to be legitimate with no problems, although he acknowledged that he did not know the parameters of what the chief or individuals in his office could do with such an account.
"I don't see anything wrong with the account," Mr. Amity said. "I don't know know what authority [Chief Harper] has, what his office can do, what it can't do."
City Controller Michael Lamb, who is conducting an audit of secondary employment funds at the police bureau, today said the Greater Pittsburgh Police Federal Credit Union is not an approved depository for any funds meant for the City of Pittsburgh.
Typically, checks sent to the city are deposited in one of roughly 15 approved city depositories, Mr. Lamb said.
"If a check is made payable to the City of Pittsburgh...that deposit would not go to the police federal credit union because they are not an approved depository for the City of Pittsburgh," Mr. Lamb said.
"If there were monies diverted to a non-approved depository of the city, I'd have to think, well, I don't know what you would characterize that other than as a theft."
Mr. Lamb is still trying to figure out what happens to the secondary employment money that is sent to the police bureau.
"I don't know that I can tell you the answer to that," Mr. Lamb said.
Every check coming into the city, Mr. Lamb said, should be made payable to the City of Pittsburgh.
Ultimately that money should be deposited into one of the various city accounts.
"That might mean one bank account. It might mean several bank accounts. And that's something we're trying to wrap our hands around right now."
From then, the exact flow of money is unclear. But Ceridian Corp., an outside vendor, at some point gets involved and handles payroll accounts.
What should not happen is a city employee writing checks for any municipal funds.
"That shouldn't happen," Mr. Lamb said. "Any check that gets written by the City of Pittsburgh should be cut here in the controller's office unless it's the payroll,kept by Ceridian."
Mr. Lamb confirmed that various departments do have access to petty cash funds for expenses -- which are regularly audited -- and top departmental officials might have credit cards.
Mr. Lamb said the city budgets all police officer on-duty overtime as well as money paid to officers through payroll for moonlighting in a single line item. The actual money paid to the officers might be over or under that amount.
Mayor Luke Ravestahl has said he thought the FBI visit to police headquarters was tied to a federal grand jury that is investigating how a city contract to install radios and computers in police cars was awarded in 2007 to Alpha Outfitters, a company prosecutors say was formed by Arthur Bedway, Chief Harper's one-time friend.
Mr. Bedway, 63, of Robinson, who has been indicted, has pleaded not guilty to mail fraud, bribery and conspiracy, and the court docket indicates discussions about a possible plea deal.
A former city systems analyst, Christine Kebr, 56, of Castle Shannon, who worked in the police bureau's fleet services division, has pleaded guilty to one count of conspiracy and admitted to accepting $6,000 in bribes connected to the awarding of the $327,000 police radio installation contract.
Chief Harper said he was not involved in the meetings to set up Alpha Outfitters and accepted no money from Mr. Bedway.
Mr. Ravenstahl said neither he nor anyone holding high positions in his administration has received a subpoena or been asked to testify before the grand jury.