Traffic camera firm caught in Chicago’s biggest ever bribery case

In what may turn out to be the biggest single corruption case Chicago has ever seen, a traffic camera company has admitted that it spent roughly $2m (£1.3m) over four years on a barely disguised bribery scheme to support and expand its lucrative contracts with the city’s transportation department.

Even in a place accustomed to gritty political practice, the case of Redflex Traffic Systems Inc and its dealings with a local consultant and a now-retired top transportation manager identified as John Bills has caused a collective intake of breath. A company whose business is catching people who cheat has now been caught itself. And it’s a bit more serious than just running a red light.

A subsidiary of an Australian holding company headquartered in Arizona, Redflex confessed to the scheme in filings with Australian financial authorities and in meetings at the weekend with the Mayor of Chicago, Rahm Emanuel. The wrongdoing was first brought to light last year by the Chicago Tribune which reported allegations made by a whistleblower at the company.

After first dismissing the claims, the company then hired David Hoffman, a former Chicago Inspector General and now a partner at a private law firm, to look more deeply into them. The claims “did, in fact, have merit”, concludes his report, which was also shared with Mr Emanuel’s office. Among dealings that the authorities would likely consider bribery were 17 all-expenses-paid holidays for Mr Bills in Arizona and California.

A greater focus of the inquiry, however, was on fees totalling $1.57m paid to a Chicago consultant connected to Mr Bills. The suspicion remains that they were to be funnelled to Mr Bills when he was serving as city programme manager.

“The arrangement was likely intended to be one in which some of the payments to the consultant would be paid to the city programme manager, an arrangement apparently proposed by the city programme manager,” the report says. Already all the top executives at Redflex’s US subsidiary have been fired because of the scandal, including its president, its chief financial officer and its top lawyer.