Former DBE director out on bond in felony theft case

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Freida Webb, the former director of Milwaukee County’s Office of Community Business Development Partners, was released Thursday on a $1,000 signature bond in connection with four felony charges.

Webb faces a maximum of $55,000 in fines and 23 years in prison for her alleged role in a scheme to steal federal Community Development Block Grant money. Webb has been charged with forgery, misconduct in public office, theft by fraud and having a private interest in a public contract, all felonies, according to a criminal complaint.

Webb refused to comment after her court appearance Thursday.

The Office of Community Business Development Partners, which Webb directed from 2003 until 2012, oversees the county’s disadvantaged business enterprise program. The complaint alleges that in her capacity as director, Webb and her accomplice, Milwaukee contractor Homer Key, conspired to steal federal money from the program.

Key was charged with forgery, conspiracy to commit the crime of having a private interest in a public contract and two counts of theft by fraud, all felonies, according to a criminal complaint. Those charges carry a maximum of $70,000 in fines and 29-½ years in prison. Key was released Thursday on a $1,000 signature bond.

From 2005 to 2010, Webb hired Key to distribute payments to instructors while overseeing the county’s Capacity Building Program, designed as a seminar for disadvantaged businesses on topics such as accounting and marketing. The county used CDBG money from the U.S. Department of Housing and Urban Development to run that program.

The Milwaukee County district attorney’s criminal complaint against Webb alleges that in 2011, she colluded with Key to fabricate a Milwaukee County contract for federal CDBG money.

Webb did not hire Key to oversee the program that year but allegedly fabricated a contract to that effect when she encountered problems paying instructors. Webb “knowingly approved more than $10,000 in fraudulent billing that Mr. Key submitted under that contract,” according to the complaint.

Key then kicked back $2,700 to Webb, according to the complaint.

The complaints against Key stem from a broader conspiracy in which the contractor allegedly “stole at least $40,000 of grant funds through fraudulent billing” from 2005 through 2011. According to the complaint against Webb, she knowingly approved incorrect invoices.

Key “padded his billing” with “excessive” class preparation time and administrative costs and, the complaint alleges, billed for classroom instruction and follow-ups that never occurred. During the same period, according to the complaint, the Milwaukee Urban League paid Key $45,917.36 to run the same program. The complaint stipulates the district attorney’s office does not believe the MUL was involved in the conspiracy.

From 2005 through 2010, according to the complaint, Webb billed for “every penny of available CDBG funding.” She was $620 shy of the limit in 2011, according to the complaint, after asking Key to submit an invoice for $4,500 in one-on-one training that never happened.

The deception also entailed billing $4,400 for a graduation ceremony that could have cost, at most, $200, according to the complaint, and disguising the cost for the evening’s dinner as a business marketing class.

The alleged conspiracy also included paying Key $3,285 to design and revise a brochure for the Capacity Building Program in 2006, 2008, 2009 and 2010, the equivalent of 42 hours of work. According to the complaint, that brochure was updated with “several mouse clicks” in 2008 and remained “virtually identical” in 2009 and 2010.

Milwaukee County Court Commissioner Barry Phillips on Thursday ordered Key and Webb not to communicate with each other. They have not responded to the charges in their respective cases, both of which will be heard by Milwaukee County Circuit Judge Jean DiMotto. Both cases are scheduled for a preliminary hearing July 10.

Webb was suspended from her position in July 2012 and replaced by Nelson Soler. She officially was terminated in March 2013. Webb’s final annual salary was $82,088.93.

Soler said the Capacity Building Program now is run internally. The Office of Community Development Business Partners now is organized under the Department of Administrative Services, which reports to the county executive. Webb reported to the County Board.

Soler said he does not have an opinion on whether that move improved oversight of the program. The problem, he said, was Webb.

“It’s not a matter of structure,” Soler said. “It’s a matter of what a person did.”

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