Baltimore Mayor Catherine E. Pugh used money from her “Healthy Holly” book deals — for which she faces federal fraud, tax evasion and conspiracy charges — to help purchase one of her Ashburton homes and pay down a home equity line of credit on another, according to a federal indictment unsealed Wednesday.
Pugh used a pair of $100,000 payments from the University of Maryland Medical Center and another purchaser to buy a 2,400-square-foot house on Ellamont Road just after her inauguration in December 2016, prosecutors said. She bought the Northwest Baltimore house for $117,500 without using a mortgage, according to property records. The house’s value had been assessed for tax purposes at $194,000.
It wasn’t the first time money from the book sales was used in connection to her homes.
After books she sold to the University of Maryland Medical System for distribution to city schoolchildren went unused, Pugh resold 1,000 of them to CareFirst BlueCross BlueShield in October 2011, prosecutors said. According to the indictment, she used the $6,000 she received to pay down a home equity line of credit on her house in the 3600 block of Dennyln Road, where she had lived since 1998.
She also used $40,000 of a $100,000 “Healthy Holly” check in 2015 “to pay down the outstanding balances of a personal credit card and a home equity line of credit,” prosecutors wrote.
Pugh’s attorney, Steven Silverman, declined to comment on the indictment Wednesday.
In October 2016, a month before the general election, Pugh told one buyer of her books that she wanted to purchase a larger house so she could entertain people when she became mayor, prosecutors said.
Court documents refer to the book buyer as “Purchaser G, the owner of a Maryland-based financing company that did business with Baltimore City.”
Purchaser G’s transactions mostly align with those acknowledged by J.P. Grant, the Columbia-based financier who frequently does business with the city. Grant did not respond Wednesday to a request for comment.
Pugh took Purchaser G to see the house, in the 3400 block of Ellamont Road, and told him she needed money to buy it; he asked how he could help, prosecutors said. Pugh suggested he “write a check to Healthy Holly, this time for $100,000,” prosecutors wrote.
Prosecutors wrote the purchaser believed Pugh would use the $100,000 for “Healthy Holly” book costs, "with the balance of the money going toward the purchase of a new house,” prosecutors wrote.
The medical system’s $500,000 in “Healthy Holly" purchases also helped pay for the larger house, according to the indictment. Pugh received a $100,000 check from UMMS for 20,000 copies of the series’ fourth book in November 2016, “part of which Pugh used to purchase a new house,” prosecutors wrote.
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Pugh deposited that check on the day after she was elected mayor, prosecutors said. She purchased the Ellamont Road house, which became her primary residence, days after being sworn in as mayor in December.
After resigning as mayor this spring amid state and federal investigations, Pugh sold her Dennyln Road house in July for $75,000 to Boaz Alternative Energy and Technologies LLC, which develops “fuel cell, solar and wind energy for residential and commercial properties,” according to the firm.
The Dennyln Road house’s assessed value was listed in property records as $187,700 at the time of the sale. But Boaz owner Michael Tisdale, who said he had “known Catherine for 40 years,” told The Sun he believed he paid a fair price for the house, which Pugh had used as a rental property.
In the indictment, federal prosecutors are demanding that Pugh forfeit the Ellamont Road house, as well as the proceeds of the alleged scheme, which they calculated to be at least $769,688.