A former municipal employee with a prominent name in Philadelphia politics solicited payoffs from those who sought his help obtaining city permits, federal authorities said Thursday.
Jeffrey Blackwell, who is the step-grandson of City Councilwoman Jannie Blackwell, allegedly bilked customers of a contracting business he ran on the side while he was employed as a fraud investigator in the City Controller’s Office.
Between 2014 and 2015, he used his position to wring more than $22,000 in bribes from homeowners and businesspeople seeking an inside track with the Department of Licenses and Inspections, said U.S. Attorney William M. McSwain.
“While employed by the Office of the Controller, Blackwell did not just investigate fraud, he was in fact committing fraud,” McSwain said at a news conference at which he announced the charges alongside officials from the FBI, the city’s Office of the Inspector General, and City Controller Rebecca Rhynhart.
Blackwell, 46, of Roxborough, surrendered to authorities Thursday morning, pleaded not guilty, and declined to comment while leaving federal court on a $40,000 recognizance bond after his hearing later in the day. Escorted by his attorney, Assistant Federal Defender Angela Halim, he ducked past a crowd of news cameras and into an awaiting car.
Rhynhart — who was elected to lead the city’s primary auditing arm in 2017, two years after Blackwell had left the Controller’s Office — said that since taking office she has overhauled its investigative staff to ensure a higher standard of professionalism.
“The overarching goal of that unit for me [was] to have professional, experienced investigators on that team,” she said. “The people who were not kept did not pass muster in that regard.”
Court records indicate that FBI agents had been pursuing Blackwell for years. As early as 2015, they allegedly caught him in a sting operation involving a cooperating source who posed as a home renovator seeking a dumpster permit from L&I.
Blackwell, the filings state, promised he could get it in exchange for payments north of $3,000.
McSwain declined to discuss the timeline of the investigation, including why his office waited four years after that successful sting to indict Blackwell.
He was first charged in June with various tax violations, which included falsely claiming a dependent on his 2013 tax forms and failing to file tax returns in the following two years. Those charges remained under seal until a federal grand jury issued a superseding indictment a month ago adding the bribery counts, each punishable by a decade or more in prison.
Blackwell’s nine-year tenure under former City Controller Alan Butkovitz ended in 2015, when he resigned after a Fox29 report raised questions about his contracting work. Several customers claimed that he had cheated them out of money while using his position in city government to earn their trust.
According to the 13-count indictment unsealed Thursday, Blackwell leaned on his government ties not only to extort money from customers but also to draw in business.
Promising he could smooth the regulatory process for a furniture seller who needed permits for temporary storage while renovating his business or a pair of body-shop owners seeking a city contract to install decals on police vehicles, Blackwell encouraged prospective clients to choose his contracting business over less well-connected companies.
Asked about her step-grandson’s case before Thursday’s City Council meeting, Jannie Blackwell told reporters she was unaware of the details.
Their relation stems from her 1972 marriage to the late Democratic Congressman Lucien Blackwell, but the councilwoman said she considered Jeffrey Blackwell like a son. She described him as a “real friendly, gregarious kind of young man.”
Still, the councilwoman maintained that she had not recommended her step-grandson for his job in the Controller’s Office.
“He knew everybody, liked everybody, they liked him,” she said. “And he loved politics and he loved his job.”
Butkovitz did not immediately return calls for comment.
Staff writer Sean Collins Walsh contributed to this article.