BALTIMORE – Federal agents raided the homes and City Hall offices of Baltimore's embattled mayor on Thursday amid dramatically widening investigations to determine whether she used bulk sales of her obscure self-published children's books to disguise kickbacks.
The searches pushed the latest political scandal for Maryland's largest city to a crescendo after weeks of uncertainty and mounting pressure for Baltimore Mayor Catherine Pugh to step down. The politically isolated first-term mayor slipped out of sight April 1, citing deteriorating health, just as the governor called on the state prosecutor to investigate allegations of "self-dealing" by the embattled Democrat.
Gov. Larry Hogan joined calls for her immediate resignation after news broke of the Thursday morning raids, as agents with the FBI and the IRS criminal division carried boxes of evidence out of City Hall. Agents also scoured her two Baltimore homes, the home of an aide and a nonprofit organization she once led.
The mayor's attorney, Steve Silverman, said federal agents came to his city law firm Thursday morning to serve a subpoena for her original financial records. They were directed to a sequestered area where Pugh's documents were kept, he said, and they did not seek any attorney-client privileged communications.
And University of Maryland Medical System spokesman Michael Schwartzberg disclosed that the medical system received a grand jury witness subpoena seeking documents and information related to Pugh.
In recent weeks, Pugh's fractured administration has staggered from one crisis to another. Yet days before announcing her departure on an indefinite leave of absence she held a hastily organized news conference where she called her no-contract book deals a well-intentioned but "regrettable mistake."
Others have been less charitable about the murky arrangements that earned $800,000 for her "Healthy Holly" limited liability company. Maryland's chief accountant called Pugh's "self-dealing" book deals "brazen, cartoonish corruption."
For years, Pugh had negotiated lucrative deals to sell her "Healthy Holly" books to customers that included the hospital network she once helped oversee and a major health plan that does business with the city. She sold $500,000 worth of the illustrated paperbacks to the University of Maryland Medical System, on whose board she sat for nearly 20 years. She also made $300,000 in bulk sales to other customers including two major health carriers that did business with the city.