HAMMOND — Portage Mayor James Snyder is either a consummate schemer or the victim of revenge and an overreaching government.

Those widely contrasting portrayals of Snyder during the second day of his felony public corruption trial in Hammond federal came courtesy of Assistant U.S. Attorney Jill Koster and defense attorney Jackie Bennett, of Indianapolis.

Koster outlined the charges against Snyder to the jury, along with evidence prosecutors expect to present during what is estimated to be a four-week trial.

Snyder "does not think rules applied to him," Koster said, telling jurors the embattled mayor attempted to hide thousands of dollars in debt to the IRS through an elaborate scheme. That scheme included establishing a shell company to hide money from federal investigators in order to avoid paying both personal and business taxes.

Koster also told them Snyder funneled about $1.1 million in contracts to a local business in exchange for receiving a $13,000 bribe and received another $12,000 bribe for securing a towing contract with former co-defendant John Cortina. Cortina pleaded guilty last week to one count of offering the bribe in exchange for being put on the city government's coveted list of towing operators.

Koster said Snyder steered contracts for automated garbage trucks to Great Lakes Peterbilt of Portage in return for the $13,000. The money, she said, was under the guise of health care and internet technology consulting. Yet Snyder is an expert in neither field and holds no state health care license, Koster said.

Bennett painted Snyder as someone who was "socialized a little bit differently," growing up in a fundamental religious home that didn't allow him to watch television or movies. That, Bennett said, causes Snyder to communicate differently.

Bennett also called the charges "false" and "bogus."

He told jurors federal investigators went to great lengths to find evidence against Snyder but have twisted the facts in each of the charges.

Bennett said political opponents within the city fueled the investigation.

Bennett also began to insinuate the entire investigation may be based on revenge, telling jurors about former Portage Police Chief Mark Becker, who, before becoming police chief served as an FBI agent for 30 years.

Becker wanted to stay chief when Snyder was elected mayor, Bennett said, but it was Snyder's intent to replace him.

"He told Snyder 'you are going to regret it,'" Bennett said before the statement drew one of several objections from Koster and Assistant U.S. Attorney Phil Benson.

The two repeatedly objected to Bennett's statements, questioning the relevance of the information ranging from Snyder's childhood to the political makeup of the city.

U.S. District Court Judge Joseph Van Bokkelen repeatedly told jurors to only consider information from the opening statement that could be supported by evidence as the trial continues.

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First witnesses

Following opening statements, two witnesses from the Internal Revenue Service were called to the witness stand to begin questioning about what the government called a scheme to evade paying both employment taxes from his mortgage business and his personal income taxes.

Benson took IRS revenue agent Gerard Hatagan step by step through initial evidence charging Snyder with obstructing the collection of taxes by the IRS. Hatagan was involved in the criminal investigation conducting forensic accounting for the IRS' special enforcement program.

During questioning, Benson introduced several financial documents showing Snyder owed some $97,000 in back employee taxes from his First Federal Trust Mortgage company and that he and his wife, Deborah, owned some $40,000 in back income taxes.

In July 2009, Snyder was sent notice from the IRS that the government agency was going to initiate a levy to collect the taxes.

It was after that, according to Hatagan's testimony, Snyder attempted to negotiate with the government, wanting to pay $5,000 to wipe out his business debt and $1,000 to clear his personal tax debt.

Hatagan testified, however, Snyder omitted employment and wage information from necessary forms to complete the negotiations.

Hatagan also testified Snyder transferred some $107,000 from his mortgage company to his personal account while still owing the government $97,000.

He also testified Snyder went to work for GVC Mortgage in January 2010 and created another company, First SRC Properties, later changed to SRC Marketing, in February 2010. Both of those actions were completed before Snyder filed forms with the IRS saying he had no money to pay the debt.

Snyder mentioned neither company as an employer or source of income in "offer in compromise" forms nor financial status forms used by the IRS to attempt to negotiate a debt settlement for either himself or his business.

In 2010, Hatagan testified, Snyder's W2 form from GVC indicated he earned $141,891 from the company. Those earnings weren't reported on the two IRS forms.

Financial transactions indicated Snyder shuffled money between the companies to possibly hide the funds so that the government could not levy them to pay his tax debt.

Hatagan will continue on the stand at 9 a.m. Wednesday to be questioned by Benson, followed by cross-examination by Snyder's defense team.

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Porter County Reporter

Joyce has been a reporter for nearly 40 years, including 23 years with The Times. She's a native of Merrillville, but has lived in Portage for 39 years. She covers municipal and school government in Porter County.