Former Baltimore state’s attorney found guilty of two counts of perjury

Jerry Jackson/Baltimore Sun/TNS
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BALTIMORE — Former Baltimore State’s Attorney Marilyn Mosby is guilty of two counts of perjury, a federal jury found Thursday.

Jurors began deliberating Thursday morning after three days of trial in the case culminating with closing arguments Wednesday afternoon.

Prosecutors accused Mosby of lying about suffering financial hardship because of the coronavirus pandemic to obtain two withdrawals from her city retirement savings account under a provision of the federal Coronavirus Aid, Relief, and Economic Security Act.

The January 2022 indictment also charged Mosby with two counts of mortgage fraud.

She used the roughly $80,000 windfall from two withdrawals from her retirement savings accounts to close on two vacation properties in Florida worth a combined $1 million, but prosecutors say she misled mortgage lenders by failing to disclose tax debts and claiming one property, an eight-bedroom house near Disney World, was a second home, when she already hired a company to run it as a rental.

Mosby’s lawyers convinced U.S. District Judge Lydia Kay Griggsby to hold separate trials for the perjury and mortgage fraud charges, and to transfer the case from Baltimore to Greenbelt.

During the three days of trial this week, Mosby’s personal finances came under the microscope.

Federal prosecutors portrayed Mosby as a greedy public official who took advantage of a law, intended to help those suffering from the pandemic, to enrich herself.

Mosby’s lawyers said she qualified under the ambiguous pandemic relief guidelines because a portfolio of personal businesses she started while in office lost money because of COVID-19.

To convict her of perjury, the jury would need to find that Mosby did not suffer an “adverse financial consequence,” which was defined for jurors as a “negative outcome related to money,” and didn’t qualify for CARES Act withdrawals as a result. They would also have to determine that Mosby lied when she checked a box on the withdrawal form, rather than making a mistake.

The government’s case against Mosby consisted of three witnesses and scores of documents, with an FBI forensic accountant’s testimony taking up the bulk of the time.

The accountant, Jenna Bender, spent hours testifying about what she found when she pored over Mosby’s financial records.

Mosby began looking for real estate in the spring of 2020, starting with homes in the Baltimore area before shifting her search to Florida. She told a realtor she wanted to “capitalize on the uncertainty of the market,” expressing an interest in multi-family dwellings.

Though she owned a home with her husband, Baltimore City Council President Nick Mosby, her attorneys said she wanted to secure an asset exclusively in her name — a first for her, they said — and set herself up for long-term financial security.

Mosby’s search came as the nascent pandemic began ravaging America. As hundreds of the employees under her at the state’s attorney’s office experienced coronavirus furloughs, Mosby maintained her approximately $250,000 salary. Still, she was short of closing costs for the two properties in Florida she eventually homed in on: the house near Disney World and a condo on the state’s Gulf Coast.

Bender said Mosby couldn’t have afforded the properties without taking the money she obtained from her CARES Act withdrawals.

The accountant’s testimony also seemed to undercut the defense’s theory of the case, as she found alternative explanations for many of the expenses Mosby counted as costs of operating her businesses. In fact, Bender testified, Mosby appears to have counted many expenses she incurred in her personal life and while working in her capacity as state’s attorney as business costs.

Mosby’s business, Assistant U.S. Attorney Aaron Zelinsky told jurors in closing arguments, “produced no income. It had no customers. It had no records.”

But Federal Public Defender James Wyda, one of Mosby’s lawyers, highlighted testimony showing Mosby spent several hundred dollars on the businesses, which were incorporated under the holding company Mahogany Elite Enterprises, and included Mahogany Elite Travel. For the businesses, she purchased a website, a Microsoft email account and paid a tax professional for advice.

“Let them belittle the size and magnitude of the loss of Mahogany Travel,” Wyda said of the prosecution in closing. “The chief administrator of the retirement program for Baltimore City said you could qualify for relief if you experienced a loss of $50.”

The prosecution drew attention to Mosby’s purchase of vacation homes as evidence that she hadn’t suffered financial hardship. But, as Wyda noted, the CARES Act placed no limit, regulation or guidelines on how someone could spend their withdrawal money.

“If Ms. Mosby qualified, she could spend the money however she liked,” Wyda told the jury. “We may not like it, but it’s not a crime.”

The elements of perjury in part hinge on what the person charged was thinking at the time they certified the statement under oath. Jurors are allowed to draw inferences from the person’s actions.

Lawyers spent time before trial arguing over the scope of questioning if Mosby chose to testify, with Griggsby ruling prosecutors couldn’t ask her about the mortgage fraud charges. Still, Mosby’s attorneys requested more time Tuesday afternoon to advise her about whether to take the witness stand.

Prosecutors offered a preview of what they planned to probe her about, a list of issues including her apparent tax impropriety, the fact that she was held in contempt of court in a separate state case and that she seems to have lied in a letter to mortgage brokers about having lived in Florida for 60 days to secure a lower, second home interest rate on the eight-bedroom house.

Mosby chose not to testify, leaving prosecutors to highlight her actions in drawing conclusions about her intent.

“She did it because she wanted the money for the houses. That’s why she took it,” Assistant U.S. Attorney Sean Delaney told jurors in closing. “She wanted it and that’s why she did it. She didn’t care if she had to commit perjury.”