16 months for rigging garbage cart contract

A Chicago businessman whose firm won lucrative contracts from the City of Chicago was sentenced today to 16 months in prison in connection with the rigging of a $1.7 million contract to repair homeowners’ garbage carts.

Wiping away tears, Douglas Ritter, 46, asked for a “minimal” sentence, telling U.S. District Court Judge Ruben Castillo that he had lost his home, his vehicles, his retirement savings and his father.

“I can’t help but cry…This was an act out of stupidity and desperation,” he said. “I stand before you a changing man.”

“Regret  is too small of a word for how I feel, but it’s all I can come up with,” Ritter continued. “How do you describe the devastation my actions have had on my personal and professional life?”

Ritter previously pleaded guilty to conspiracy to commit mail and wire fraud. Prosecutors had sought a reduced 27-month prison term because he had cooperated with the U.S. Attorney’s office.

In 2005 Ritter was desperate to hold on to a city contract that his firm, Urban Services of America, had held for a decade, so he submitted three phony bids to the city. The city’s inspector general discovered the fraud and turned the investigation over to federal prosecutors.

Ritter had long been under investigation by the city following a series of stories by the Tribune about his companies and city contracts.

In 2000, the city named the company to handle cleanup at city festivals to replace Windy City Maintenance, a phony woman-owned firm that was run by James Duff, who was convicted of federal fraud in connection with the contract and is serving a 10-year prison firm. The Tribune subsequently reported Urban was being paid twice what Windy City had received.

In 2004, the Tribune reported the city had mailed more than $3 million in checks to Urban for work performed by another company with a similar sounding name. The city had mailed Ritter’s company the checks despite knowing the other firm’s owner died. The checks were endorsed with a stamp and deposited into Urban’s account.

That story prompted another look at the firm by the city’s inspector General’s office.

Urban donated more than $50,000 to political coffers, including $35,000 to the Hispanic Democratic Organization, the once powerful, pro-Daley organization led by former aide Victor Reyes.

Prosecutor Diane Lotko-Baker described Ritter’s cooperation as substantial and noted it led to the conviction of Steven Fenzl, the co-owner of Urban. He faces sentencing in June.

Elliot Samuels, an attorney for Ritter, sought a light sentence, arguing that the city never really lost any money on the cart repair contract.

“My client is not a rocket scientist or brain surgeon… He’s reliable. He’s honest. He’s truthful,” said Samuels.

Castillo suggested that Ritter and his attorney had attempted to downplay the serious of the crime. “You do stand convicted of what I consider a serious crime,” he told Ritter. “ It was a scheme. It was a fraud, and you are a fraudster and that is why you are going to jail.”