Federal jury finds co-defendants guilty in Indianapolis Land Bank bribery case

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INDIANAPOLIS — A former Indianapolis city official has been found guilty of accepting bribes and kickbacks while overseeing a city program that sells vacant and tax-delinquent properties.

Reggie Walton was convicted Wednesday of eight felony charges, including wire fraud, bribery and conspiracy to commit money laundering, after a two-week trial.

Walton is the former assistant administrator of abandoned buildings in Indianapolis. Prosecutors alleged Walton used his city post as supervisor of the Indianapolis Land Bank to enrich himself.

He was tried along with David Johnson, the executive director of the nonprofit Indiana Minority AIDS Coalition, who was found guilty on five counts, including wire fraud and conspiracy to commit money laundering.

Walton and Johnson each likely face about 10 years in prison.

"Mr. Walton tried to sell our local government in Indianapolis through a scheme involving power, secrecy and greed," said U.S. Attorney Josh Minkler. "Our local government is not for sale and this verdict sends that message."

The Indianapolis Land Bank acquires abandoned and tax-delinquent properties in the city and returns them to productive use by selling them to real estate developers. For-profit investors must pay at least the appraised value, while nonprofits can bypass the auction process and purchase parcels for as little as $1,000.

Walton and Johnson accepted bribes to facilitate fraudulent sales to nonprofits that would then sell the property to for-profit businesses, according to prosecutors. After these "pass-through" transactions, the pair would receive kickbacks from the nonprofits, they say.

Three other defendants have pleaded guilty in the case and are awaiting sentencing.

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