- David A. Wilson, Executive Director
Media Contact for Former Peabody City Treasurer Jeanne Carnevale Pays $50,000 Civil Penalty for Violating the Conflict of Interest Law
Gerry Tuoti, Public Information Officer
Boston, MA — Former Peabody City Treasurer Jeanne Carnevale has admitted to violating the conflict of interest law by using her public position, city funds, and other public resources in three sales of tax-delinquent Peabody properties which financially benefited her family and associates. Carnevale paid a $50,000 civil penalty, signed a disposition agreement approved by the State Ethics Commission, and waived her right to contest the Commission’s findings.
As City Treasurer, Carnevale was responsible for initiating tax title foreclosure proceedings on real estate tax-delinquent properties in Peabody. In 2015, Carnevale, as City Treasurer, hired a private attorney to probate the estate of the deceased owner of a tax-delinquent Catherine Drive property. Carnevale then used her City Treasurer position and her foreclosure power to steer, direct, and compel the estate’s administrator and heir to sell the property to a building contracting company that had previously worked on her home, using Carnevale’s friend as his real estate broker. The friend’s broker’s fee was $9,750. After purchasing the property for $195,000, the building contracting company built a $90,000 addition and resold the property for $625,000 less than a year later.
In 2016, Carnevale, as City Treasurer, hired the same private attorney to probate the estate of the deceased owner of a tax-delinquent Columbia Boulevard property and establish a trust for the deceased owner’s daughter, who lived at the property. Carnevale then used her City Treasurer position and other public resources to expedite the deceased owner’s daughter’s move into Peabody public housing so that the property could be sold to Victory Realty Trust, a trust of which Carnevale’s daughter was trustee and Carnevale’s husband and her friend’s husband were beneficiaries. Once the deceased owner’s daughter was moved into public housing, Carnevale’s daughter, as Victory Realty Trust’s trustee, purchased the Columbia Boulevard property for $125,000. Carnevale’s friend was to receive a $4,000 broker’s commission on the sale. Five days later, Carnevale’s daughter resold the Columbia Boulevard property for $210,000 to the same building contracting company that purchased the Catherine Drive property in 2015.
In 2017, Carnevale acted as City Treasurer in connection with the sale of a tax-delinquent Lynnfield Street property to Victory Realty Trust. Prior to the sale, Carnevale, as City Treasurer, communicated with the city building commissioner regarding the property and requested that the City’s Tax Attorney’s paralegal prepare an Instrument of Redemption in anticipation of the sale. After Victory Realty Trust purchased the property for $239,500, Carnevale signed the Instrument of Redemption as City Treasurer, which cleared the tax lien on the property.
Carnevale violated two sections of the conflict of interest law.
The conflict of interest law prohibits municipal employees from participating in their official capacities in matters in which they know they or members of their immediate family have a financial interest. Carnevale violated the law by participating as City Treasurer in matters relating to the sales of the Columbia Boulevard and Lynnfield Street properties to Victory Realty Trust, which she knew would financially benefit her family.
The conflict of interest law also prohibits municipal employees from using their official positions to obtain for anyone valuable privileges or benefits that are not properly available to them. Carnevale violated the law by using her position and power as City Treasurer and other public resources to compel the sale of the Catherine Drive property to the building contracting company using her friend as the broker, improperly enabling her friend to receive a broker’s fee and the company to substantially profit from the resale of the property. Carnevale also violated the law with respect to the Columbia Boulevard property by using her official position and power and other public resources to probate the deceased owner’s private estate, establish a private trust, and expedite moving the occupant of the property into public housing, all of which improperly enabled Victory Realty Trust to purchase the property and resell it at a substantial profit and her friend to receive another broker’s fee.
The State Ethics Commission is charged with civilly enforcing the conflict of interest law, G.L. c. 268A. When three or more of the Commission’s five members vote to find reasonable cause to believe a public employee has violated the law, they can authorize adjudicatory proceedings to determine whether the violation occurred. The public employee then has the opportunity to enter into a public Disposition Agreement rather than exercising his or her right to a hearing.
The Commission encourages public employees to contact the Commission’s Legal Division at 617-371-9500 for free advice if they have any questions regarding how the conflict of interest law may apply to them.