Biaggi Extortion Conviction in Wedtech Case Upheld

NEW YORK —  A federal appeals court Friday upheld the conviction of former Rep. Mario Biaggi in the Wedtech Corp. scandal, two days after he was paroled from a halfway house in connection with an unrelated conviction.

Biaggi, 72, appealed his eight-year prison sentence and $242,000 fine after the conviction on charges he extorted millions of dollars in stock in exchange for his influence to win lucrative defense contracts in the Wedtech matter.

Wedtech was a South Bronx defense contractor that became enmeshed in a corruption case stretching to the nation’s capital. The scandal ruined the careers of several other politicians.

The U.S. 2nd District Court of Appeals, ruling on Biaggi’s appeal, said Friday that it was satisfied prosecutors did not improperly characterize “lawful political contributions and legal fees as bribes and extortion payments” to the jury.

“This case demonstrates how blurred the line can become in practice when a company that requires political assistance and legal services in dealing with governmental bureaucracies makes payments to officeholders and lawyers associated with them,” the three-member panel said.

Biaggi, once a highly decorated city police officer, resigned his Bronx congressional seat in August, 1988, to press his appeals, but he still received 36,000 votes in that year’s general election.

Biaggi was sentenced in November, 1987, to 30 months in prison and fined $500,000 for accepting illegal gratuities from former Brooklyn Democratic boss Meade Esposito.

The U.S. 2nd Circuit Court of Appeals upheld that conviction the same week Biaggi was convicted in the Wedtech case.

He spent 11 months in the minimum-security Federal Correctional Institution in Ft. Worth in the Esposito case before being transferred to a halfway house in the Bedford-Stuyvesant section of the borough of Brooklyn.

He was released on parole Wednesday, said Jimmy Powell, duty officer at the Bureau of Prisons in Washington, D.C.

In a separate action Friday, the appeals court overturned the extortion convictions of former Rep. Robert Garcia and his wife, Jane, clearing the way for a new trial.

The Garcias were convicted last October of extorting $76,000 from Wedtech in return for help in obtaining federal government contracts.

The appeals court reversed the verdict, ruling that the couple never threatened Wedtech or its officers with economic harm.

“Garcia never even hinted that he was prepared to use his power to harm Wedtech,” the court said. “Wedtech paid the Garcias to ensure that it would receive special, preferential treatment. In making the payments, the company was motivated by desire, not fear.”

Garcia, 57, a Democrat from the Bronx, resigned his seat in Congress in January, 1990, after being convicted and before being sentenced.

Despite the appeal, Garcia began serving a three-year sentence last March. Mrs. Garcia, 48, also was sentenced to three years but remained free pending the appeal.

Prosecutors had alleged that the Garcias extorted $76,000 in payments channeled through Mrs. Garcia’s consulting business and a $20,000 interest-free loan from Wedtech.

They hinted that Mrs. Garcia’s desire for luxuries caused her to push her husband to break the law. Prosecutors showed that the Garcias’ personal accounts were frequently overdrawn by thousands of dollars and that Mrs. Garcia ran up large credit card bills.