Defense attacks honesty of key witness in Renee Tartaglione fraud trial

The defense team for Philadelphia politician Renee Tartaglione, opening its case Friday, attacked the credibility and honesty of a key prosecution witness, ex-state Rep. Leslie Acosta.

One defense witness, Kensington social worker Arumugam Harshraj, told the U.S. District Court jury that in 2010, Acosta demanded two payments from him totaling about $9,000 in order to be hired as a therapist at the Juniata Community Mental Health Clinic co-founded by Acosta's mother, Sandy.

Another witness, State Rep. Angel Cruz, a nine-term Democrat whose 180^th District abutted Acosta's in the Kensington-Fairhill neighborhood, described a meeting in which Acosta was plotting against Tartaglione.

"She wanted to take ownership of the Juniata clinic away," Cruz said.

The witnesses followed the theme of lawyer William DeStefano's defense: an intense rivalry between the Acosta and Tartaglione families in which Sandy and Leslie Acosta sold out Tartaglione in a deal with prosecutors to escape prosecution for their own fraud at the clinic.

Tartaglione, 61, scion of a storied family in city Democratic politics, was president of the clinic's board and owner of the company that rented a five-story building at 2637 N. Fifth St. to the clinic.

DeStefano has maintained that Tartaglione trusted Sandy Acosta to handle the clinic's finances.

Acosta, 45, was a contract quality assurance analyst at the clinic, where her mother was administrator.

Tartaglione was indicted last year on 53 counts of conspiracy, theft, fraud, and tax evasion. Federal prosecutors allege that she siphoned about $1 million from the clinic between 2007 and 2012.

Assistant U.S. Attorney Bea Witzleben and Peter N. Halpern, a trial attorney from the Justice Department's public integrity section in Washington, allege that Tartaglione charged exorbitant rent for the Fifth Street building and pushed through approval as a clinic board president.

She also allegedly ran a scheme in which key clinic staff — the Acostas — received checks for no work and then cashed them and kicked back the money to Tartaglione.

Testifying last week, Leslie Acosta said her mother recruited her for the alleged scheme because "Renee didn't want to pay the taxes on the money."

Both Acostas have pleaded guilty and testified for the government. Both await sentencing.

The defense will continue its case Monday and U.S. District Judge Joel H. Slomsky told the jury it could begin deliberating by midweek. DeStefano said he and Tartaglione have not decided whether she will testify.

Defense witnesses portrayed the Juniata clinic as an oasis in a neighborhood plagued by extreme poverty and drugs.

Michael Wright, who replaced Sandy Acosta as the administrator in June 2014, said Juniata was one of the best community mental health clinics in the city, albeit one with money problems and obsolete financial controls based on paper records. Wright said Tartaglione and husband Carlos Matos insisted that "we kept the clinic impeccable. Those kind of things were not negotiable."

He said the clinic welcomed members of the community who weren't patients, especially in summer when poor neighbors sought relief in the air-conditioned building, and in winter for people who had no heat in their homes. They provided food and clothing when needed. And when a neighborhood church burned down, Wright told the jury, the clinic allowed the congregation to use the building's fifth floor free as a temporary place to worship.

Wright said that the clinic's finances rapidly deteriorated after federal agents raided it in the probe that resulted in Tartaglione's indictment. In 2013, he said, the clinic's revenue was $2.8 million and it had received $1.4 million by midyear. By 2016, the Juniata clinic's annual revenue was down to $1.5 million with just $825,000 at midyear. Tartaglione once wrote a $20,000 check to cover the clinic payroll and another to cover the clinic's $115,000 federal tax debt, Wright said. It was then, according to Wright, that he recommended closing the clinic, and the board agreed.

"How did you deal with that?" asked DeStefano.

"It was tough," said Wright, voice breaking and eyes welling. Recalling the clinic's role in the community, he repeated: "It was tough. I felt that we let them down."