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November 04, 2022

Ex-SEPTA manager took cash payments from vendor for inside information, prosecutors say

The scheme allegedly helped a video surveillance company win contracts worth millions of dollars

Investigations Fraud
SEPTA Bribery Charges Thom Carroll/for PhillyVoice

A former SEPTA manager is accused of taking cash payments and other benefits from the owner of a vendor that he helped land large contracts for video surveillance equipment, according to a federal indictment.

An ex-SEPTA manager accepted tens of thousands of dollars from a business owner in exchange for information that helped the company secure contracts with the transit authority, federal prosecutors said Friday.

James Stevens, the former director of SEPTA's video evidence unit, and Robert Welsh, who owned Spector Logistics, Inc., were indicted for allegedly engaging in a bribery and extortion scheme from March 2014 to July 2018. 

During that period of time, SEPTA contracted with Spector Logistics, Inc., which was chosen to install, maintain and supply video equipment used to monitor SEPTA facilities. Spector Logistics formerly was owned and operated out of Wilmington, Delaware by Welsh, 59, who now resides in Arizona.

Stevens, 69, of Somerdale, New Jersey, allegedly gave Spector Logistics and Blue Zebra, another company owned by Welsh, an unfair advantage against competing vendors in SEPTA's contracting process. 

Stevens provided Welsh with inside information about SEPTA's financial analyses and other factors that helped the companies land contracts worth millions of dollars, federal prosecutors said. In exchange, Stevens allegedly demanded Welsh give him money and other benefits during the time the arrangement was in place. 

In addition to the cash payments Stevens received, Welsh also made a donation to a charity that Stevens used as a front to pocket more money, investigators said. 

During Pope Francis' visit to Philadelphia in 2015, Welsh allegedly paid for Stevens' lodging and meals, and covered similar expenses on other occasions, too. For instance, Welsh paid for Stevens' tickets to a 2016 Barbra Streisand concert and covered costs for annual SEPTA holiday parties, investigators said.

Stevens also allegedly demanded that Welsh promise him employment at Spector Logistics after he retired from SEPTA.

A SEPTA spokesperson said Friday that the authority will continue to work with federal authorities as the case moves forward, but declined to comment on the indictment.

Stevens and Welsh are each charged with conspiracy, bribery, extortion and fraud.

"Philadelphians deserve public employees who do their jobs honestly, without corrupting the system to line their own pockets," said U.S. Attorney Jacqueline C. Romero. "As alleged in the indictment, the defendants' participation in this scheme was extensive: using millions of dollars in public contracts to fraudulently benefit themselves."