Former N.J. School Chief Sentenced for Insurance Kickback Scheme

September 17, 2012

The heralded former superintendent of New Jersey’s fourth-largest school district was sentenced last Friday to 11 years in prison in a corruption case that the judge called the worst case of public corruption he’s ever seen.

Sixty-four-year-old Michael Ritacco, who ran the Toms River schools for 20 years before he was arrested in 2010, stood stoically in a Trenton courtroom on Friday, Sept. 14, after he’d been given his sentence, even as relatives wept around him while U.S. marshals kept them from getting close enough to give him a last hug before he reported to prison.

Ritacco pleaded guilty in April to tax evasion and public corruption, admitting accepting kickbacks totaling $2 million or more for giving insurance brokers inflated commissions for school board business.

U.S. District Judge Joel Pisano, who has presided over some of New Jersey’s more notorious recent corruption cases, told Ritacco that his was worse than the others, event that of former Camden Mayor Milton Milan. Milan was convicted in 2000 of taking payoffs from the mob, laundering drug money and stealing campaign funds.

“It takes the cake,” Pisano said, adding that Milan made the city “the laughingstock of urban America” when he sentenced him to seven years in prison in 2001. “Milton Milan was like nickels and dimes compared with this.”

Friday’s sentence proceeding centered on a philosophical question about whether Ritacco could be a good man who made one bad mistake, or whether he’s bad to the core.

Ritacco and his lawyers made the case for the former.

They submitted a legal memo asking for leniency, 140 letters from supporters and a bound booklet laying out Ritacco’s accomplishments.

In court Friday, some supporters told about the good Ritacco has done. They included Dave Campo, a longtime college and NFL football coach who’s now an assistant at the University of Kansas and Leonard Coleman, a former New Jersey public official who also served as president of baseball’s National League.

The judge heard about how Ritacco was a pioneer in bringing solar power to a school district, established a day care for the young children of educators, made it easier for children to walk to school, set up a program to try to prevent drug abuse, kept property taxes stable and was seen as a potential state education commissioner.

“I’m hoping that he has time to rebuild his reputation,” said Campo, who’s known Ritacco since college. “I’m hoping that he has time for his kids and his grandchildren.”

Ritacco himself said he was remorseful, saying he accepts “full responsibility for what’s happened” and acknowledging how he hurt his family’s reputation. He didn’t talk so much about his accomplishments, telling the judge, “As you know they get forgotten very quickly with one bad thing.”

But the bad thing, as Pisano and prosecutors pointed out, was a long-lasting one.

Assistant U.S. Attorney Dustin Chao said Ritacco conspired to inflate fees to an insurance broker and took kickbacks in return.

Pisano said at least $4 million in public money was taken, and he estimated that Ritacco collected at least $2.3 million in ill-gotten money over the years.

Assistant U.S. Attorney Dustin Chao told about Ritacco’s $2.2 million house on the Jersey shore, his $1 million condo in Florida and other homes, his $100,000 Mercedes and watches worth tens of thousands of dollars he bought girlfriends.

“When a person does a bad thing day after day for over 10 years, he’s not a good person who does bad thing,” Chao said, “he’s a bad person who sometimes doesn’t do bad things.”

The insurance broker, Francis Gartland, of Baltimore, pleaded guilty in April to participating in a scheme to bribe the superintendent.

Pisano said he’ll hold a hearing later to sort out how much restitution each man is responsible for paying to the Toms River school board. He said that the $150,000 in fines he ordered Ritacco to pay could be given to the district.

During the hearing, Pisano asked Ritacco a question: “How did this happen,” he asked. “Were you vested with such authority that you could perpetrate this fraud for as long as you did with no oversight?”

Ritacco said it had to do with changes in the way insurance worked.

But Pisano said that didn’t explain how he could get away with it for so long.

 

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