Former Director of Marketing and Merchandising for PA-Liquor Control Board Charged in Honest Services Fraud Scheme
HARRISBURG—The United States Attorney’s Office for the Middle District of Pennsylvania announced today that the former Director of Marketing and Merchandising for the Pennsylvania Liquor Control Board (PA-LCB) has been charged with a scheme to defraud the state, its citizens and the PA-LCB of their right to his honest services as a public official through bribes, kick-backs and concealing information.
According to United States Attorney Peter Smith, James H. Short, Jr., age 50, of Harrisburg, Pennsylvania, is charged with Honest Services Mail Fraud in a Criminal Information filed today in the United States District Court in Harrisburg. Short served as the Director of Marketing and Merchandising from approximately 2003 to 2012 and supervised the process through which alcoholic beverages are selected and acquired for sale in Pennsylvania’s state-run liquor stores. With over $1 billion in annual revenue, the PA-LCB is one of the largest purchasers of alcohol in the world.
The charge is based upon Short’s alleged 10 years (2002 to 2012) of receiving benefits from a distributor and a manufacturer of alcoholic beverages sold in Pennsylvania’s stores. These benefits included all-expense paid golf trips, cash, gift cards, meals, and other benefits.
As Director of Marketing and Merchandising for the PA-LCB, Short supervised the process of recommending to the PA-LCB which new products should be sold and which products should no longer be sold in Pennsylvania’s 500 state-run liquor stores. Short has been charged with accepting things of value from the companies with the intent to be influenced in decisions he made to recommend new products and remove others from Pennsylvania liquor stores while failing to disclose the receipt of the items in annual financial reports he was required to submit to the State Ethics Commission as a public official.
The Information describes two alleged examples of all-expense paid trips to Florida. In February 2010, Short is alleged to have been taken by private jet on an all-expense paid golf outing to Bonita Bay, Florida with the purpose of influencing his decision to list a particular product for sale. This trip, as well as a similar trip in December 2011, were part of an ongoing stream of benefits the vendor and manufacturer provided to Short to influence his decisions. The specific mailing in the charge is correspondence Short allegedly caused to be sent to company A in February 2012 notifying the company of a PA-LCB decision approving the listing of the company’s products.
No date has been scheduled yet for entry of Short’s guilty plea. Together with the Criminal Information, the government also filed a plea agreement with Short, which is subject to the approval of the court, and a joint statement of facts concerning the offense.
The case is part of a continuing investigation by the Harrisburg Office of the FBI and is being prosecuted by Assistant United States Attorney Michael A. Consiglio. The case initially was brought by the Pennsylvania Ethics Commission which found that Short violated the Pennsylvania Ethics act when he accepted certain things of value charged in the present federal case.
Indictments and Criminal Informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
The maximum penalty for the offense is 20 years of imprisonment, a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant’s educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.