Former Calumet Township Trustee Dozier Allen and a handful of his deputies fraudulently cut themselves checks from federal grants for work actually performed by underlings in Allen's office, sources close to a federal investigation of the process say.
Monthly between 2000 and 2002, Calumet Township trustee clerks would print an inch-thick report detailing expenditures for helping welfare recipients get jobs, sources close to the probe who spoke to The Times under condition of anonymity have revealed.
And then three or four township officials, sometimes including Allen, would cut themselves checks of $1,000 or more for making sure that the report was produced and sent out, those sources said.
Federal prosecutors say the scenario was fraud and Allen and friends helped themselves to $143,000.
Before Allen was indicted, the eight-term township trustee directly confronted the allegations, saying the payments were approved by the Calumet Township board and disclosed to auditors, none of whom ever raised a concern.
Defense attorney Fred Work has said the charges are baseless and that Allen intends to fight the allegations in court.
Allen, 75, is expected to plead not guilty to the charges Oct. 16 in Hammond federal court. The three former deputy trustees -- Wanda Joshua, Ann Marie Karras and Albert Young Jr. -- already have pleaded not guilty and each posted $20,000 unsecured bonds.
The indictment alleges that the payments were never disclosed to the township board members and that the four concealed their personal profit from a public contract.
The issue stems broadly from federal efforts during the 1990s to move welfare recipients into the work force.
Ivy Tech Community College's Division of Workforce Development Services was designated locally in 1998 to receive federal grants for welfare-to-work efforts, but the grants required local matching money, court records show.
The township office already was providing welfare-to-work services. So Ivy Tech paid the township up to $50,000 a year to keep track of exactly how much was being spent.
Sources say the township's front-line clerks did all the record-keeping and report-printing, even though the administrators took nearly all the money between January 2000 and December 2002.
Initially, only Joshua, Karras and Young took the money, authorities allege. But after Allen lost the 2002 primary election, he cut himself a $12,000 check for "retroactive services" in June 2002 and eventually received $28,000 that year from the Ivy Tech grant, the indictment alleges.
In addition to serving 32 years as trustee, Allen briefly served as mayor of Gary when he was appointed by outgoing Mayor Scott King, who resigned in March 2006 to pursue private goals. Allen lost the seat two weeks later when local Democrats selected Rudy Clay as interim mayor in a closed caucus.
