Former Phila. Traffic Court judge pleads guilty to federal fraud and tax charges

Robert Mulgrew used to wear the black robes.

Soon, though, he’ll likely don prison garb, and for quite a number of years.

The former Philadelphia Traffic Court judge was into the first day of his trial at U.S. District Court in Philadelphia when he abruptly opted to plead guilty in order to spare his wife, Elizabeth, a co-defendant in the federal case, from seeing a similar fate as that of her husband.

Mulgrew, 55, of Philadelphia, pleaded guilty to mail fraud and conspiracy to commit mail fraud, as well as filing a false tax return, in connection with a scheme to defraud the Pennsylvania Department of Community and Economic Development (DCED).

The guilty plea was announced Thursday by the U.S. Attorney’s Office for the Eastern District of Pennsylvania.

Mulgrew, who at the time of his crimes sat on Philadelphia’s scandal-plagued and since-abolished Traffic Court, engaged in a scheme to fraudulently receive and misuse state grant money given to nonprofit organizations, according to federal prosecutors.

The DCED awarded hundreds of thousands of dollars in grants to both the Friends of Dickinson Square (FDS) and the Community to Police Communications between 1996 and 2008, with the understanding that the money would be used specifically to benefit those groups.

The DCED awarded more than $450,000 in grants to the Friends of Dickinson Square to buy equipment and materials for the maintenance of South Philadelphia’s Dickinson Square, and the state agency awarded about $397,000 in grants to the Community to Police Communications, with that money designed to go toward the purchase of police communications equipment and materials to secure vacant lots and buildings for the protection of the police, according to the U.S. Attorney’s Office.

Mulgrew, who served as vice president of the Friends of Dickinson Square at the time, had signed the grants contracts with the DCED for that group.

A codefendant in the federal case, Lorraine Dispaldo, who previously pleaded guilty in connection with the scheme, had signed the grant contracts with DCED for the Community to Police Communications money.

“The defendants misrepresented their intentions to DCED, and that – contrary to their agreement to spend grant funds solely to purchase equipment and materials for neighborhood revitalization and improved communications with the police – the defendants used thousands of grant dollars to pay Mulgrew’s relatives and associates,” reads a statement from the U.S. Attorney’s Office.

After giving out the grant money to friends and relatives, Mulgrew and Dispaldo supplied the DCED with false and misleading information to conceal the “actual amount of grant funds which they paid to the relatives and associates contrary to the express purposes of the grant,” the government stated.

The two defendants spent thousands of dollars in grant money on themselves, prosecutors had alleged.

Mulgrew in particular improperly reimbursed himself from FDS funds for thousands of dollars of expenditures that he claimed were incurred by the neighborhood group, but in reality were incurred by Mulgrew personally.

The two also supplied the DCED with false documents to conceal their personal use of grant funds.

Mulgrew failed to report the additional income from the fraud scheme on his federal income tax return and claimed false business deductions that ended up reducing his tax liability, the government’s statement reads.

Mulgrew faces up to more than two decades in federal prison, five years of supervised release, and unspecified restitution to both the Internal Revenue Service and the Commonwealth of Pennsylvania.

According to local media reports, Mulgrew agreed to plead guilty to the crimes in exchange for the dismissal of charges against Elizabeth Mulgrew, his wife.

Elizabeth Mulgrew had also faced charges of income tax fraud since the couple jointly filed taxes.

Mulgrew is charged in a separate federal case stemming from a so-called “ticket-fixing” scandal at Philadelphia Traffic Court in which a total of nine judges were accused of improperly scrapping motor vehicle citations for friends, relatives and political acquaintances.

The Pennsylvania General Assembly voted during last legislative session to eliminate Philadelphia Traffic Court, the only one of its kind in the commonwealth’s 67 counties, from the state judiciary.

Traffic Court’s fate still has to be sealed by a public referendum during this legislative session.

In the meantime, traffic cases in the city have since been transferred to Philadelphia Municipal Court.