Street acquitted of all fraud charges

T. MILTON STREET was a happy camper yesterday.

The flamboyant older brother of former Mayor John Street was acquitted on fraud charges by a federal jury, which found him guilty only of failing to file tax returns from 2002 through 2004.

Jurors deadlocked on two counts of assisting in the filing of false tax returns in 2000 and 2001.

Prosecutors said that they were undecided whether they would retry Street on those charges.

Street's co-defendant, John H. Velardi Sr., was acquitted of one count of mail fraud and two counts of wire fraud.

U.S. District Judge Legrome D. Davis set Street's sentencing for May 22.

He could face 27 to 33 months in a federal prison under sentencing guidelines.

The food vendor and former state lawmaker had been charged by the feds in November 2006 with one count of mail fraud, two counts of wire fraud, one count of honest-services fraud, two counts of assisting in the filing of false tax returns and three counts of filing false tax returns.

Had Street been convicted of all charges, he could have faced a prison term of 46 to 57 months.

Speaking with reporters outside the courthouse minutes after the verdicts were read, a beaming Street said that the federal investigation and subsequent trial had been "a long, exhausting and humbling experience."

Street, 68, of Moorestown, N.J., said it was a "major victory" to be cleared of all the fraud charges.

"Failure to file is a misdemeanor," he said. He remains free on bail pending sentencing.

Of the acquittal, former mayor Street said: "Milton has always insisted publicly and privately that he was not involved in any corruption at the Philadelphia airport. However I am still concerned about the convictions for failure to file three years of tax returns. This is serious and should not be taken lightly. I will continue to pray and support him as he deals the remaining legal issues."

Authorities had charged that Milton Street and Velardi defrauded a businessman at the airport. The men agreed to assign Street's $3.2-million maintenance subcontract to businessman Thanh Nguyen in exchange for $80,000, prosecutors said, even though the contract had been voided by the city three months earlier.

Velardi, 54, of Media, was the maintenance-facilities director for the prime contractor, Philadelphia Airport Services.

"I'm just glad it's over," a grateful Velardi said, as his wife, Liz, hugged him and wiped away tears of joy. "It's been a long ordeal."

Defense attorneys Guy Sciolla and Jeremy Ibrahim said that the case boiled down to the credibility of three key prosecution witnesses.

"I think the primary government witness was Thanh Nguyen, and I think [the jury] just completely dimissed him," said Sciolla, Velardi's lawyer.

Prosecutors said during the trial that Nguyen was under investigation for tax violations and money laundering.

Ibrahim, Street's lawyer, said it was "clear" the jury didn't believe the testimony of the key government witnesses.

Street said he didn't want to speculate about what was in the minds of jurors.

"They came back with a verdict they thought was fair and that I'm satisfied with," Street said, adding: "Well, it could have been a lot worse, couldn't it?"

Jurors, who had deliberated almost three days, declined to speak with reporters afterward.

Asssistant U.S. Attorney Jennifer Arbittier Williams said the jury "appropriately found" that Street "exploited his perceived influence" when he was paid more than $2 million of consulting fees and "failed to report that income, failed to file his tax returns and failed to pay his fair share."

Street testified in his own defense on Feb. 14 that he didn't file tax returns in 2002 through 2004 because he believed that the income tax was unconstitutional.

He also had been charged with defrauding PAS of the honest services of a maintenance manager, Matthias Schwabe.

The feds said that Street had paid Schwabe $98,000 to perform personal favors for him.

Schwabe pleaded guilty in December 2006 to fraud and filing a false tax return, and testified for the government. *