Dive Summary:
- When McKeesport, Pa. controller Ray Malinchak saw a $170,000 annual increase in city sanitation costs after switching from Allied Waste to Nickolich Sanitation, he personally hired a private investigator and forwarded his findings to the federal government.
- Since then, 16 people in McKeesport, Pennsylvania, including a councilman, three former police officers and supervisors have been charged after being linked to a multi-million dollar gambling ring.
- In December, a federal grand jury subpoenaed information regarding the municipal garbage collection and sale of scrap; it is speculated the sharp rise in collection costs was being investigated and a wiretap was put in place, which eventually led to the gambling charges.
From the article:
The district attorney's office confirmed that it had referred a complaint "concerning the sanitation contract and other issues including the handling of vehicles and scrap" to the FBI, according to DA spokesman Mike Manko.
A lengthy search warrant affidavit in the gambling case documents how state agents overheard on a wiretap a discussion about a "big investigation" involving the FBI and McKeesport's former public works director, Nickolas Shermenti.
The FBI subpoena, faxed to McKeesport Mayor Mike Cherepko around Christmas, sought "invoices, weight slips, copies of cancelled checks or other documentation supporting proof of payment for garbage collection and hauling services" by Allied Waste Services and Nickolich Sanitation from January 2006 through July 2012. Allied held the contract before Nickolich.