DALLAS — Sixteen people have been charged in an extensive bribery and extortion scheme involving affordable housing in Dallas. Prosecutors allege that former Dallas Mayor Pro Tem Don Hill, Hill’s current wife and former political consultant Sheila Farrington, state Rep. Terri Hodge, and others took bribes from low-income housing developer Brian Potashnik and his wife, Cheryl Potashnik.
In exchange, their firm, Southwest Housing, allegedly received multimillion-dollar contracts to build apartments in Dallas. The Potashniks and other defendants have pleaded not guilty.
The investigation is two years old, but the federal indictments were unsealed last fall.
Prosecutors claim that Southwest Housing received the support of state and local officials by bribing them. The Potashniks used the approvals to receive low-income housing tax credits to build apartments in south Dallas. Prosecutors accuse some of the defendants of “disguising payments to make them look like gifts.”
“We are not guilty of any of the things they have alleged here,” said Don Hill, according to CBS 11 News. “We haven’t had the chance to tell the world that we are not guilty … We’re just going to prepare for that fight—to prove our innocence.”
Evidence in the case includes more than 30,000 wiretapped phone calls, 200 boxes of documents, 100 consensual recordings, surveillance photographs, and videos of city council meetings. The FBI also seized information mostly from city computers, which equates to an additional 238,000 boxes of documents. This information was released to defense attorneys last December.
Also in December, a judge permitted the defendants and their lawyers to get affidavits, which FBI agents began using in 2005 to obtain search warrants and use wiretaps. The affidavits are not being released to the public to protect the privacy of informants who interacted with the defendants, according to prosecutor Marcus Busch. At least one former council member, Leo Chaney, has admitted being a witness.
In another Dallas housing scandal, Darren Reagan, the founder of the Black State Employees Association, has been accused of stealing money from the Dallas Housing Authority’s Sec. 8 program.