Baltimore City State’s Attorney Marilyn J. Mosby (D) was indicted by a federal grand jury on four charges Thursday, including perjury for falsely claiming a COVID-19 hardship on applications to withdraw $90,000 from her retirement account.
The withdrawals, without a tax penalty, were a temporary financial option created by the federal CARES Act for people who suffered hardships during the pandemic. Mosby’s annual salary is $247,955.58.
Mosby’s defense attorney, A. Scott Bolden, released a lengthy statement after the indictment.
He said the “bogus charges” were “rooted in personal, political and racial animus five months from her election.”
Mosby faces two counts of perjury for the two separate withdrawals from the retirement account citing coronavirus-related hardships and two counts of making a false statement on a mortgage loan application.
Federal prosecutors say those false statements were made on mortgage applications for a home in Kissimmee, Fla., and a condominium in Long Boat Key, three hours to the west. As part of both applications, Mosby did not disclose a federal tax lien of $45,022 that had been placed against her and her husband, Baltimore City Council President Nick J. Mosby (D), 42.
After withdrawing the cash from her retirement account, Mosby took out a $490,500 mortgage on the Kissimmee home and a $428,400 mortgage on the Long Boat Key condo.
In each application, Mosby also responded “no” in response to the question: “Are you presently delinquent or in default on any Federal debt or any other loan, mortgage, financial obligation, bond, or loan guarantee,” even though she was delinquent in paying federal taxes to the IRS, prosecutors said.
The Mosbys jointly had outstanding federal income tax liens for the 2014, 2015 and 2016 calendar years totaling $45,022, which was paid Feb. 21, 2020, according to a filing with the Baltimore City Circuit Court clerk’s office. Nick Mosby repeatedly told the press there were no such any such tax liens against the couple by the federal government.
Bolden said Thursday that Marilyn Mosby wasn’t aware of the tax lien and so couldn’t have lied on the mortgage paperwork.
Nick Mosby has not been accused of any wrongdoing.
According to the indictment, Marilyn Mosby also signed a “second home rider” for the Kissimmee property, representing to the mortgage company that the house would be used primarily as a personal residence for at least one year and would not be rented as a vacation property. The rider was signed on Sept. 2, 2020; a week earlier, on Aug. 25, Mosby had signed an agreement with a vacation home management company to control the property, according to the indictment.
By saying the home would be for personal, and not rental, use, Mosby could secure a lower interest rate, federal prosecutors said.
The purchase of the two Florida properties first disclosed by the Baltimore Brew news website last spring.
On the perjury charges, prosecutors allege that Mosby lied on paperwork for two withdrawals from her retirement account: $40,000 on May 26, 2020 and $50,000 on Dec. 29, 2020.
To qualify for a retirement distribution through the CARES Act provision, Mosby certified that she experienced adverse financial consequences from the pandemic for one of four allowable reasons: as a result of being quarantined, furloughed, or laid off; having reduced work hours; being unable to work due to lack of childcare; or the closing or reduction of hours of a business she owned or operated.
Federal prosecutors said that Mosby did not experience any such financial hardships and received her full gross salary of $247,955.58 from Jan. 1, 2020 through Dec. 29, 2020, in bi-weekly gross pay direct deposits of $9,183.54.
On Roland Martin Unfiltered, a daily online broadcast, Bolden said the CARES Act provision allowed people affected financially “in any way” and that Mosby’s travel-related side businesses had taken a hit. “Her accountant urged her to take that money and she took that money” to buy homes, Bolden said.
“Today, we have the indictment, which are mere allegations. Tomorrow, we will fight vigorously for the truth, justice and I believe Ms. Mosby’s innocence will prevail,” Bolden said in the written statement.
The maximum penalty for perjury is five years in federal prison; the maximum penalty for making false mortgage applications is 30 years.
An initial hearing in U.S. District Court has not been scheduled.
Late Thursday, the Office of the State’s Attorney issued a brief statement saying “State’s Attorney Mosby and the office remain completely focused and wholly committed to serving the citizens of our city. Our leadership and our frontline prosecutors are some of the best in the world and we will not be distracted or sidetracked from our mission to make Baltimore a safer community.”
Mosby, a Democrat, faces reelection this year, first with a June 28 primary in a city where Democrats outnumber Republicans by nearly 11 to 1, making the Nov. 8 general election an all but foregone conclusion.
She held a reelection fundraiser Nov. 18, and another one, a virtual event billed as a “celebrity birthday bash,” Wednesday night. She will turn 42 on Jan. 22.
Two former assistant state’s attorneys have announced they were candidates for Mosby’s seat in the Democratic primary — Roya Hanna, 45, and Ivan J. Bates, 53, who ran unsuccessfully against Mosby in 2018.
Mosby was first elected in 2014, defeating incumbent Gregg L. Bernstein. She gained national notoriety following the April 2015 death of Freddie Gray, 25, a week after he sustained a spinal cord injury during a ride in the back of a police wagon, when she charged six officers involved in arresting and transporting the man who was handcuffed and shackled. All pleaded not guilty.
At the time, Mosby was criticized by some for overreaching when she hastily brought the charges, amid looting and rioting that swept parts of the city. One officer’s trial ended in a mistrial, and two others were acquitted before Mosby announced in July 2016 that charges against the remaining three officers would be dropped.
In 2018, with the backing of much of the city’s Black political hierarchy, she won a three-way primary against Bates and Thiruvendran “Thiru” Vignarajah, a former assistant U.S. attorney, assistant state’s attorney and deputy attorney general.
Throughout her second term, Mosby continued to carefully foster her national presence, testifying on Capitol Hill and appearing at numerous out-of-town conferences. An in-depth news story by Baltimore Brew into Mosby’s extensive out-of-town travel — much of which was reimbursed by the sponsors — prompted her to ask the Baltimore Office of the Inspector General to investigate.
The IG found that she had been away from the office 144 days during 2018 and 2019 — some of them requiring international travel — and been given dozens of gifts by event sponsors. The findings caused Mosby to file an amended report with the Maryland State Ethics Commission in July 2020.
That filing, the Brew found, also revealed that Mosby had created Mahogany Elite Travel, Mahogany Elite Consulting and Mahogany Elite Enterprises LLC in May 2019.
Nick Mosby also created a consulting company, Monumental Squared LLC, whose address was the same as a Baltimore developer and campaign contributor, the Brew later found.
Last spring, a federal grand jury subpoenaed a variety of records belonging to the Mosbys, including the couple’s business records, travel records, campaign reports and charitable donations, according to published reports at the time. FBI agents seized some of Nick Mosby’s records at his Baltimore City Hall office.
Last summer, the “Mosby 2021 Defense Fund” appeared online, soliciting money to pay legal bills for the Mosbys, after acknowledging they were under investigation by federal authorities.
Bolden said Thursday that the U.S. Attorney’s Office for Maryland had rebuffed multiple attempts to discuss their investigation. He said the indictment filed Thursday was “a far cry from criminal tax evasion and tax related charges that were at the heart of this federal investigation.”
In 2020, Marilyn Mosby initiated an experiment of not prosecuting drug possession crimes, prostitution, trespassing and nuisance offenses. A year later, she formally adopted the policy, saying the “era of tough-on-crime prosecution” was over.
The decision drew some criticism by police and some in the political arena, including Gov. Lawrence J. Hogan Jr., and was questioned by others, including the federal judge overseeing the U.S. Department of Justice consent decree with the city police department. The city entered into the DOJ agreement after investigators found that police officers routinely violated the constitutional rights of residents.