The former CEO of Redflex Traffic Systems, Inc. was sentenced on October 19, 2016 to 14 months in federal prison for a bribes-for-contracts scheme in Ohio. Karen Finley, who was ousted from her position with the company that provides automated red light camera ticketing systems, was also sentenced in November to 30 months in prison for a much larger – to the tune of $2 million – bribery scandal in Chicago, Illinois. She will serve the terms concurrently.
The long-running corruption involving Redflex and Chicago public officials was first exposed by the Chicago Tribune in 2012. After entering into a contract with RedFlex, the city’s red light camera system soon grew to the largest in the nation, with 384 cameras that generated more than $600 million in traffic fines and fees. No elected officials have been charged in the case, but several collaborators were prosecuted. John Bills, then the no. 2 official in then-Mayor Richard Daley’s Department of Transportation, steered contracts to Redflex in exchange for cash and gifts throughout the 10-year conspiracy. He received 10 years in prison for his role in the scheme, in which he received cash payments, vacations, a Mercedes and a condo in Arizona, among other bribes.
Martin O’Malley, a consultant for Redflex, acted as a “bagman”; he pleaded guilty and was sentenced to six months in prison. Ohio lobbyist John Raphael admitted he had threatened Redflex executives with the loss of contracts if they refused to make political contributions; he was sentenced to 15 months in prison plus one year of supervised release and a $5,000 fine in June 2016.
After the scandal was revealed, Ohio lawmakers banned red light cameras. In Chicago, Mayor Rahm Emanuel canceled the city’s contract with Redflex, awarded the red light ticketing system contract to another company, and appointed Northwestern University to study the camera program and recommend corrective actions. Redflex’s automated red light camera system has been criticized in multiple jurisdictions for incorrectly ticketing drivers and serving as a source of revenue rather than a means of ensuring traffic safety. [See: PLN, Sept. 2014, p.14].
On February 6, 2017, a $20 million settlement between Redflex and the City of Chicago was announced in a lawsuit stemming from the corruption investigation; the company will make annual installment payments from 2017 through 2023. See: City of Chicago v. Redflex Traffic Systems, Inc., U.S.D.C. (N.D. Ill.), Case No. 1:15-cv-08271. While the amount of the settlement was substantial, consider that Redflex reportedly received $120 million in revenue from its Chicago contract alone. The company is still under investigation in Australia, where its parent corporation, Redflex Holdings, is located. In a statement, Redflex executives noted that despite the settlement, it still has “150 existing contracts in communities across the Americas.”
Sources: www.phoenixnewtimes.com, www.chicagotribune.com, www.dispatch.com
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Related legal case
City of Chicago v. Redflex Traffic Systems, Inc.
|Cite||U.S.D.C. (N.D. Ill.), Case No. 1:15-cv-08271|