Former City Representative Desiree Peterkin Bell, who was a member of Mayor Michael Nutter's cabinet, faces a half-dozen felony corruption charges for allegedly stealing and misusing funds from a city-run nonprofit.
A 14-month state grand jury investigation found that Peterkin Bell misspent nearly $250,000 in public money. The charges, filed Tuesday, include theft by unlawful taking and theft by deception, receiving stolen property, and tampering with public records. Peterkin Bell would face up to 35 years in prison if found guilty on all counts.
"The tax dollars in the Mayor's Fund were supposed to be used on programs that benefited the city and its citizens," state Attorney General Josh Shapiro said in a news conference announcing the charges. "Instead, Ms. Peterkin Bell … used the public money to fund her own lavish lifestyle — vacations, shopping, dining, and entertaining that benefited her and not the public."
Peterkin Bell, through her attorney, denied all charges. She surrendered to detectives Tuesday morning, was arraigned, and was to be released on her own recognizance.
"Ms. Bell has made significant contributions to the city of Philadelphia," her attorney, Walter Weir Jr., said. "We will vigorously defend the matter and look forward to our day in court."
The Mayor's Fund is a nonprofit set up to advance the mayor's policy goals and promote the city. Until last year, the city representative had been the chair of the fund, overseeing about $10 million annually in grants.
The fund came under scrutiny over the last two years from former Controller Alan Butkovitz and in stories by the Inquirer and Daily News that raised questions about fund spending and the oversight of its managers.
Peterkin Bell became city representative and took over the Mayor's Fund in 2013. Her expenses raised concern among the staff but it wasn't until she and Nutter left office in 2016 that the fund's executive director, Ashley Del Bianco, went to the Controller's Office to ask for a review. Butkovitz's office found that Peterkin Bell had shopped at Macy's and J.Crew with fund money, paid for meals at posh Center City restaurants, and traveled to New York, Washington, and other cities. She also paid a $8,738 tab for more than 400 Uber rides in 2015. The Inquirer and Daily News found that in total, she failed to offer detailed explanations for $52,000 worth of charges she made that year on the American Express and Wells Fargo MasterCard credit cards issued by the fund.
At the time, Butkovitz said that Peterkin Bell treated the nonprofit like a "slush fund," blowing close to $400,000 on hotels and travel in 2014 and 2015. Peterkin Bell disputed that characterization and filed a defamation suit against the controller that was later dismissed. Nutter also vehemently defended Peterkin Bell and called Butkovitz "a snake."
Nutter said then that Butkovitz was "desperately fabricating an issue where there is no real issue."
On Tuesday, however, Nutter released a statement explaining that his past comments were based on what he knew at the time.
"I am greatly saddened and very deeply disappointed to learn the details of this new information and these specific allegations," Nutter said. "If these new allegations are true, they do not reflect the tone and standards that I established for my administration during my tenure."
Shapiro said that the investigation didn't find any evidence to suggest Nutter knew of Peterkin Bell's misconduct.
"I take it he's withdrawn his 'snake' comment," Butkovitz said Tuesday. "Most public officials wouldn't be able to get away with that. … He [Nutter} asserted that he had certain knowledge that this stuff was not true, and he did everything he could to obstruct an investigation into this activity."
The grand jury report released Tuesday provided more details about Peterkin Bell's alleged misuse of fund money. She made charges in excess of $20,000 on two fund credit cards to pay for personal vacations, including at the Waldorf Astoria Resort in Orlando and for a wedding anniversary celebration in Portland, Ore. She also used a fund credit card to pay for a $1,700 dinner party at the Hyatt at the Bellevue, titled "Purpose Not Position," to promote her future consulting business in the last few days of the Nutter administration.
According to the Attorney General's Office, when Peterkin Bell was questioned about the dinner party expense, which included 17 meals and a dedicated bartender, she said it was work-related and refused to provide documentation.
"This former city representative ran the mayor's fund as her own personal fiefdom. She ruled by fear and used her close relationship with the mayor to amass power and to intimidate city employees to do exactly what she wanted," Shapiro said.
It was not clear why it took more than a month to unveil the grand jury report, dated Oct. 12, and charge Peterkin Bell. A spokesman for Shapiro could not explain the delay.
When Peterkin Bell couldn't raise enough for the 2015 Welcome America and 2014 Forbes 30 Under 30 events, she used $225,000 in taxpayer money — earmarked for the Philadelphia International Cycling Classic — to compensate. She also instructed fund employees to create a false sponsorship agreement in an attempt to justify the move, Shapiro said.
He also noted that Peterkin Bell was not the first to misuse the fund's money.
The Inquirer and Daily News reported last year that Melanie Johnson, who served as city representative in the first part of Nutter's eight-year tenure, also used the fund's credit cards to make questionable personal purchases. In September, the city Ethics Board found that she had spent nearly $7,000, fined her, and ordered her to repay funds. On Tuesday, Shapiro said the grand jury did not charge Johnson with any crimes.
He said he referred the alleged conduct of two other former city officials in the case to the Philadelphia Board of Ethics. Shapiro declined to name the officials.
Before Butkovitz left office, following his reelection defeat, he grew increasingly frustrated with members of the Mayor's Fund staff, who he said were stonewalling his investigation. He suggested that the fund seek reimbursement of the misspent money and referred the case to the Attorney General's Office.
On Tuesday, a spokeswoman for the Mayor's Fund said that once the Attorney General's Office started its investigation, city officials decided to hold off on Butkovitz's recommendation.
In the last year, the Kenney administration has overhauled the fund by appointing a new board and chair, who are expected to select a new executive director.