Newark councilman admits to scheming to obtain bribes and kickbacks

NEWARK, NJ — Joseph A. McCallum Jr., a member of the Newark Municipal Council and board of directors of the Newark Community Economic Development Corporation, now known as Invest Newark, has admitted to scheming to obtain bribes and kickbacks, and subscribing to a false personal tax return for 2018, U.S. Attorney Philip R. Sellinger announced March 18.

McCallum, 66, of Newark, pleaded guilty on March 18 before U.S. District Judge William J. Martini to an information charging him with one count of wire fraud for devising a scheme, using interstate wire communications, to defraud Newark and the NCEDC of the right to McCallum’s honest services and one count of subscribing to a false personal tax return for calendar year 2018.

According to documents filed in these cases and statements made in court, as a member of the Newark City Council, representing the West Ward, and of the NCEDC from 2017 through February 2020, McCallum schemed to receive concealed bribes and kickbacks from an associate, funded by developers, contracting companies and other businesses, seeking contracts and approvals principally related to development, construction and real estate projects and deals in Newark. These developers and others were solicited by the associate to hire his consulting company for “access,” and were introduced to McCallum as the councilman behind the particular project or deal of interest to them. McCallum then received and planned to receive concealed bribes and kickbacks derived from the fees that the associate obtained from those who retained his company.

In exchange, McCallum used his official positions to assist those who retained the associate’s company. For those who refused or hesitated to pay, McCallum and the associate intended to prevent them from obtaining contracts and work from the NCEDC and the city of Newark. McCallum and the associate used interstate emails and phone calls to further this scheme and took significant steps to conceal these bribes and kickbacks.

The bribes and kickbacks received and sought by McCallum through the associate included the following: a $16,000 bribe funded by a payment from a contracting company; a $25,000 bribe and kickback funded by a payment from a developer’s company; and $500 in cash to cover travel expenses for an out-of-country trip and an attempt to receive part of a $50,000 payment from a second developer.

The honest services wire fraud charge in Count 1 of the information to which McCallum pleaded guilty carries a maximum penalty of 20 years in prison and a fine of $250,000, or twice the pecuniary gain to the defendant or loss to the victims, whichever is greatest. The false tax return charge in Count 3 of the information to which McCallum pleaded guilty carries a maximum potential penalty of three years in prison and a maximum $250,000 fine, or twice the pecuniary gain to the defendant or loss to the victim, whichever is greatest. Sentencing is scheduled for July 21.

  Fraud, Newark City Council, U.S. Attorney’s Office