The first major Abscam case indictments were returned yesterday against three members of the Philadelphia city council and a lawyer who allegedly was a key middleman in the undercover FBI operation.
A federal grand jury in Philadelphia charged that the three officials, council president George X. Schwartz and members Harry P. Jannotti and Louis C. Johanson, violated racketeering and extortion laws in taking $65,000 in January from FBI agents posing as representatives of a wealthy Arab businessman.
Howard L. Criden, a law partner of Johanson and a potential witness to similar videotaped transactions with several members of Congress, solicited $18,000 from the agents for his role in arranging the payoffs to the councilmen, the indictment said.
Federal grand juries in New York and Washington have been hearing evidence on the vidotaped transactions with the members of Congress, and indictments in some of those cases are expected in the next several weeks.
The Abscam undercover operation was disclosed in press reports in early February, as FBI agents began questioning subjects of the 18-month-long investigation.The massive publicity -- before grand juries were empaneled -- triggered cries of alarm from defense lawyers, civil libertarians and top Justice Department officials, who started an intensive investigation of leaks.
Criden was considered a key witness against at least two of the House members under investigation, Reps. John M. Murphy, (D.N.Y.), chairman of the Merchant Marine and Fisheries Committee, and Frank Thompson (D-N.J.), chairman of the House Administration Committee. Criden is alleged to have accepted $50,000 at separate meetings where the undercover agents discussed private immigration bills with the two congressmen.
But Criden's attorney, Richard BenVeniste, refused government demands that Criden plead guilty and then become a prosecution witness in hopes of gaining a lenient sentence. BenVeniste said yesterday that he expects his client to be indicted as the prosecutors "continue to put enormous pressure on him to capitulate."
The lawyer called the indictment "fantasy grafted upon fiction" because the undercover operatives "who were pressing money on individuals now somehow become victims of extortion."
Ben-Veniste also questioned the "rush" to indictment before the leak investigation was concluded.
Mark E. Goldberg, an attorney for Schwartz, said he had no immediate comment on the indictment because he hadn't read it yet. He, too, has raised the leaks as an issue, arguing they prejudiced the grand jurors who had to vote on the indictment.
Schwartz and Jannotti said they had no intention of giving up their council seats because of the indictment.
"I don't know any elected officials who have removed themselves at this state of the proceeding," Schwartz said. "I believe my presence is needed."
Jannotti said, "I intend to work the same hours and make the same number of appearances I always have."
The new indictments are just the latest in a long string of federal prosecutions of prominent Philadelphia politicians.
Just the day before, four other top state Democratic officials were indicted on charges of putting "ghost" workers on state legislative payrolls. And two Democratic Philadelphia congressmen, Reps. Michael O. Myers and Raymond F. Lederer, also have been indentified as targets of the Abscam investigation.
The case against the Philadelphia councilmen was developed late in the wide-ranging undercover operation.
FBI agents rented a posh suite in the Barclay Hotel in mid-January and, according to the indictment, Criden then arranging meetings with the council members.
On Jan. 18 Johanson took $25,000 in cash as consideration of his help on a planned hotel venture by the phony Arab businessman, the grand jury charged. Schwartz took $30,000 and Jannotti $10,000 about a week later, the indictment said.
FBI agents Michael Wald, Anthony Amoroso, and Ernest Haridopolos acted as the representatives of the phony Arab sheik.
Criden was named in all six counts of the indictment, two racketeering and four extortion charges. The racketeering statute was passed in 1970 to aid prosecution of organized crime but has been used increasingly in recent years in public corruption cases. It carries a possible 20-year prison term and $25,000 fine.
Each of the council members faces one racketeering and two extortion charges.