Ex-Sen. Lynch pleads guilty to tax evasion Admits accepting payments to lobby for sand-mining operation BY CHRIS GAETANO Staff Writer One of the most powerful Democrats in New Jersey has pleaded guilty to corruption charges. Former state Senate President John Lynch, 67, of New Brunswick, pleaded guilty to one count of mail fraud and one count of tax evasion in federal court in Newark. Lynch admitted that he took corrupt payments and used two consulting companies, Executive Continental and Alma Limited, to conceal the crimes. Both firms provide consulting services to individuals engaged in development projects. Lynch was a 50 percent partner in Executive Continental with John Westlake, 76, of Red Bank, a member of the Monmouth County Board of Taxation, who also pleaded guilty to charges of tax evasion. Lynch, who was a state senator from 1982 to 2002, was known as an influential political boss who acted as a mentor to former Gov. James McGreevey. Through his political action committee, New Directions Through Responsible Leadership, Lynch raised hundreds of thousands of dollars for Democratic candidates throughout the state. The charges against Lynch stem from his dealings with Alma Limited and that company's relationship with a South Brunswick sand-dredging company, referred to in court documents as just "the Sand Company." While not explicitly named, there is only one sand-dredging company in South Brunswick, which is Dallenbach Sand, located in the township's Dayton section. According to the U.S. Attorney's Office, the company was looking to expand its operations but needed state Department of Environmental Protection approval in order to do so. To expedite the process, Alma Limited was conscripted. It was agreed that Alma would assist Dallenbach with its dealings with various state agencies and departments, including the DEP. The company wanted to expand to property owned partially by the trustees of the Operating Engineers Local 825, which were using it as a training site, and partially by the state. The company planned to give the township 54 acres of its land for use as a park if the expansion was approved. According to authorities, Alma was also hired to help Dallenbach get that project approved as well. For its services, Alma sought payment between $120,000 and $200,000. In March 1998, through Alma and Executive Continental, it was agreed that Lynch would give support to Dallenbach in matters over which he had official power. It was also agreed that he would hide his involvement in the matter. On March 2, 1998, Lynch sent a letter to the commissioner of the DEP in support of Dallenbach's proposal for the expansion of its grounds and the land swap that would follow. On March 6, 1998, Lynch attended a meeting with the president of Dallenbach at the time, and money owed to Alma was discussed. Lynch, in a letter sent to Dallenbach discussing this matter, was simply referred to as "our friend." According to court documents, on June 23, 1998, Lynch received a $7,500 check issued from Executive Continental's bank account and made payable to Lynch. On June 26, 1998, Lynch received a $4,500 check that, again, came from Executive Continental. This check was used to pay Lynch's income taxes. The two checks were part of Lynch's share of the June 18, 1998, payment to Alma from Dallenbach of $30,000. On Dec. 3, 1998, Lynch sent a letter to the deputy commissioner of the DEP, again in support of the company's expansion and the land swap that would follow. A week later, Lynch sent Dallenbach a letter saying that Alma was owed $25,000 for its services. The invoice for the charges, listed as "professional services rendered in lobbying," was sent from Alma to Dallenbach on Dec. 23. According to authorities, on Dec. 31, 1998, Lynch received a $10,000 check from the Executive Continental bank account as well as a $3,563.93 check used to pay off his American Express card. According to the investigators, these were part of Lynch's share of the $25,000. According to investigators, on Feb. 18, 2002, Lynch sent a letter from Alma to Dallenbach, seeking payment for services, including payment for official services rendered by Lynch. On Aug. 4, 2002, the Zoning Board voted in favor of Dallenbach's application to import sand from neighboring Monroe, a practice that was against the local mining ordinance. Lynch's tax-evasion charge stems from $150,000 in income that he failed to declare to the federal government. Consequently, he owes the government between $30,000 and $80,000. Westlake failed to include $350,000 in income in 1999, authorities said. Lynch could face between 33 and 41 months in federal prison, though the guidelines are only advisory and the judge will have wide discretion as far as sentencing goes. Lynch released a statement through his attorney apologizing for his actions. He said he decided to come forward about his deeds because it was "the right thing to do." "I spent more than 20 years in public office before retiring five years ago, and I remain proud of the many public achievements in which I played a role. However, I recognize that the misconduct which I today acknowledged will forever overshadow those achievements. I cannot adequately describe the extent to which that reality pains and sorrows me," Lynch said. U.S. Attorney Christopher Christie credited special agents of the FBI in Philadelphia under the direction of special agent in charge J.P. Weiss, special agents in Newark under the direction of Leslie G. Wiser and agents of the IRS Criminal Investigations Division, under the direction of Patricia J. Haynes. "Today, an era of corruption and influence peddling for personal profit has been put to an end. There is no one in this state, no matter how powerful, who is above the law," Christie said.