Please ensure Javascript is enabled for purposes of website accessibility

Loizeaux Brothers Go on Trial

Two prominent Baltimore County businessmen went to trial yesterday charged with causing the treasurer of Elijah E. Cummings’s 1996 congressional campaign to file false statements with the Federal Election Commission.Federal prosecutors told a jury in Baltimore that J. Mark Loizeaux and his brother, Douglas K. Loizeaux, president and vice president of Controlled Demolition Inc., of Phoenix, used corporate money to reimburse four employees, who made $1,000 contributions each to Cummings’ campaign. Cummings was running to fill the 7th Congressional District seat vacated when former Rep. Kweisi Mfume retired to head the NAACP, Corporations are barred by federal law from contributing to congressional campaigns.Cummings, who is not accused of wrongdoing, supported demolishing decrepit federal high-rise public housing projects and replacing them with low-density town houses and garden apartments. Officials of Controlled Demolition, known for imploding Baltimore landmarks such as Lafayette Courts and Lexington Terrace complexes, saw it in their financial interest to support him, according to both prosecutors and defense attorneys.Controlled Demolition Inc. is famous also for imploding famous landmarks such as the King Dome in Seattle, the Dunes Hotel in Las Vegas and, more recently, the observation tower at Gettysburg National Battlefield. The family-owned business also has demolished SCUD missile facilities in Central Europe and earthquake-damaged buildings in Central America and the Middle East.“This is the case about two powerful businessmen who decided to use employees of their own company to funnel money into a federal campaign,” Assistant U.S. Attorney Kathleen O. Gavin told the jury yesterday.Douglas and Mark Loizeaux told employees Robert Kulinski, James Santoro, Raymond D. Zukowski, Stacey Loizeaux (daughter of Mark Loizeaux) and Fred Nicol that the company would give them “bonuses” if they wrote $1,000 checks to the Cummings campaign, Gavin said.All the employees wrote the checks and accepted reimbursements except Nicol, Gavin said.Nicol endorsed his check back to the company because he knew it was illegal for the corporation to make a contribution, Gavin told the jury.“The true source of those contributions was [Controlled Demolition Inc.],” Gavin said. “Those payments were not treated [for accounting purposes] like any bonuses CDI paid to its employees.”Defense attorney Gregg L. Bernstein, who represents Douglas Loizeaux, called into question the government’s chief witness, Nicol. He left the company in 1997 under “somewhat unfavorable” circumstances, Bernstein told the jury, and has since established a demolition business to compete with CDI.Bernstein said the “senior” CDI employees contributed to Cummings’ campaign simply because they had a common interest — demolishing aging high-rise public housing complexes.“These employees were not ordered to make these contributions,” said Bernstein, who explained that the Loizeaux brothers and the company were not charged with making contributions but, rather, with knowingly causing the campaign treasurer to file false statements.“It is on these very slim and innocuous facts” that the government sought a grand jury indictment of the Loizeaux brothers, Bernstein said.Bernstein also disputed Gavin’s picture of the brothers as “two powerful businessmen,” noting they live on the same tract of land where their father started a stump-dynamiting business in 1947. The family-owned business employs about 18 workers, many of them members of the Loizeaux family, Bernstein said.Bernstein called the brothers “political neophytes,” and defense attorney Martin S. Himeles Jr., who represents Mark Loizeaux, continued on that theme.“These are not powerful businessmen in Washington dealing with the political hierarchy,” said Himeles. He described the 300 pages of federal campaign regulations as “confusing and complex and ambiguous.” It took regulators seven pages to define “contribution” and nine to define “expenditure,” Himeles said.If convicted, Mark Loizeaux and Douglas Loizeaux face up to five years in prison and $500,000 in fines on each of the two counts. Controlled Demolition could be fined up to $1 million, according to court documents. The trial is expected to go into next week.