Feds: Ex-Chelsea housing head underreported pay

January 23, 2013, 8:58 pm
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BOSTON (AP) - The former director of the Chelsea Housing Authority was paid as much as $120,000 more than he claimed, according to prosecutors who charged him Wednesday with falsely reporting his salary to the federal government.
    
Investigators from U.S. Attorney Carmen Ortiz's office allege Michael McLaughlin knowingly falsified his salary in annual housing authority budgets from 2008 to 2011 and submitted them to the state Department of Housing and Community Development. The reports are also required by the federal Department of Housing and Urban Development.
    
Investigators allege that in the 2011 fiscal year, McLaughlin, 67, reported that his annual salary was $160,415, when he knew his actual salary was at least $283,471 and his total compensation was at least $324,896.
    
Prosecutors allege McLaughlin also falsely reported his income in 2008, 2009 and 2010.
    
McLaughlin's lawyer Thomas Hoopes declined to comment Wednesday.
    
McLaughlin, who lives in Dracut, faces a maximum punishment of 20 years in prison, followed by three years of supervised release and a fine of $250,000 on each of four counts.
    
Massachusetts Attorney General Martha Coakley, whose office participated in the investigation, said McLaughlin "exploited his position as housing authority director to knowingly and intentionally commit fraud against taxpayers in violation of federal law."
    
McLaughlin stepped down in 2011 following Gov. Deval Patrick's demand for his resignation after it was shown he was one of the country's highest-paid public housing officials.  The housing authority's board of commissioners also resigned and the authority was temporarily placed into receivership.
    
The housing authority, which oversees distribution of state and federal funding, manages about 1,450 housing units in eight developments in the city of 35,000 residents just northeast of Boston.
    
The governor has proposed consolidating the state's public housing management system into six regional offices he says would improve accountability.
    
The Boston Globe reported last year that McLaughlin had also run an extensive political operation for Lt. Gov. Timothy Murray.
    
While acknowledging that McLaughlin had been a political supporter, Murray said he was unaware of the hefty salary.
    
Murray also asked the state Office of Campaign and Political Finance to investigate whether McLaughlin improperly raised money for Murray's past political campaigns.

(Copyright 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.)

Tags: massachusetts, Martha Coakley, investigation, Federal Court, carmen ortiz, Michael McLaughlin, Chelsea Housing Authority
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