Director of Operations of North Bergen Housing Authority Sentenced to 46 Months in Prison in Extortion Scheme

NEWARK, NJ—The director of operations for the Housing Authority of the Township of North Bergen, New Jersey was sentenced today to 46 months in prison for extorting employees of a maintenance company contracted by the authority, U.S. Attorney Paul J. Fishman announced.

John T. Kennell, 50, of North Bergen, previously pleaded guilty before U.S. District Judge Jose L. Linares to an information charging him with extortion under color of official right and by fear of economic harm. Judge Linares imposed the sentence today in Newark federal court.

According to documents filed in the case and statements made in court:

While the director of operations for the NBHA, Kennell used his official position to extort cash payments from employees of a company that provided repair and grounds maintenance services. Kennell, who supervised the employees of the company working for the Authority, accepted cash payments in amounts ranging from $100 to $400 from employees for, among other things, securing additional paid vacation days for these employees. Kennell assisted in securing these additional paid vacation days by falsely reporting to the company that the employees were working at the NBHA, when they were, in fact, traveling outside of the United States. Between February 2008 and June 2011, the company compensated employees for approximately 80 days of unauthorized vacation, totaling $12,498, because of Kennell’s actions.

Kennell accepted $2,000 to $2,500 in payments for his official assistance in this fraud. He also accepted cash payments of $50 to $100 from an undocumented alien employee of the company for permitting that employee to twice change the alias that employee was using to continue working. Using his position of authority, as well as the threat of termination of employment, Kennell also regularly extorted the employees of the company—sometimes as frequently as twice a month—for cash payments in amounts ranging from $10 to $20 per employee.

In addition to the prison term, Judge Linares sentenced Kennell to three years of supervised release and ordered him to pay a $5,000 fine.

U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford in Newark; special agents of U.S. Department of Housing and Urban Development Office of Inspector General, under the direction of Special Agent in Charge Cary A. Rubenstein; and criminal investigators from the U.S. Attorney’s Office in Newark with the investigation leading to today’s sentence.

The government is represented by Assistant U.S. Attorney Lee M. Cortes, Jr. of the U.S. Attorney’s Office Special Prosecutions Division in Newark.