Edinburgh, Fife & East Scotland

Four jailed over Edinburgh City Council bribes

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Media captionCouncil contracts were awarded in exchange for tens of thousands of pounds and hospitality

Four men who admitted corruption charges over Edinburgh council building repairs have been jailed.

Council workers Charles Owenson, 62, and James Costello, 44, helped award contracts to Edinburgh Action Building Contracts Ltd (ABC Ltd).

In return, ABC directors Kevin Balmer, 52, and Brendan Cantwell, 44, gave them tens of thousands of pounds, trips to lap dancing clubs and football tickets.

The charges related to the maintenance of council buildings from 2006 to 2010.

Sheriff Michael O'Grady QC said the offences admitted by the men were "very grave indeed".

'Unholy alliance'

"For a period of almost five years you acted together in this unholy alliance stealing from and manipulating the public purse almost at will," he said.

He jailed Owenson for four years and four months, Costello for three years and nine months, Balmer for two years and 10 months and Cantwell for two years and three months.

Balmer and Cantwell were each also disqualified as directors for five years.

Edinburgh Sheriff Court heard that Owenson and Costello were provided with hospitality by the Edinburgh-based construction firm, including corporate seats at Hibs and Hearts football matches, meals out and visits to bars, as well as cash.

Image caption Charles Owenson was one of the council employees to have received bribes
Image caption Brendan Cantwell is a former director of ABC

The contractors even submitted inflated invoices to the local authority for work carried out to cover the costs of the bribes they were paying council officials.

Fiscal Keith O'Mahony earlier told the court: "In essence, the council was being charged for the cost of bribing its own officials."

Invoices were found that were falsely inflated to the value of more than £67,000.

Owenson, from Drum Brae Neuk, and Costello, from Balerno, had admitted offences under the 1889 Public Bodies Corrupt Practices Act and proceeds of crime charges. Both have been dismissed from their jobs.

Balmer, and Cantwell, both from Livingston, also admitted a corruption offence, while Balmer also admitted fraud.

ABC, which was said to have been turning over £4m a year and employed 70 staff at the height of its success, went into liquidation on 2010.

First offenders Owenson and Costello both worked as property care services officers with the council in a department that looked after schools, care homes, community centres and cemeteries.

Whistleblower letter

Police began carrying out inquiries in 2010 as a result of complaints about the statutory notices system and were later informed that senior management at the council had received "a whistleblower letter" alleging that Owenson was showing favouritism when allocating work to contractors.

In 2011 officers went to the ABC offices and seized documents which included records of payment sought by ABC from Edinburgh City Council.

The fiscal said the paperwork included a figure ranging from £20 to £2,000 and the initials of either Owenson or Costello next to that amount. A total of 175 suspicious work orders were identified.

Owenson was linked to 102 of the orders and his initials or name was against sums of money totalling £28,387. Costello was linked to 73 of the work orders with his initials against amounts of cash adding up to £14,134.

Owenson and Costello were regular visitors to the offices of ABC. About 93% of the invoices issued by the firm from 2006 to 2010 were for work carried out on behalf of the local authority.

Mr O'Mahony said witnesses saw Balmer regularly putting cash in the top drawer of his desk in envelopes.

When the council officials came to the ABC offices to meet Balmer they would go into a meeting room, which was all glass, and the blinds would be drawn. No witnesses saw money being passed over.

In 2009 Balmer told a member of staff at the firm that he was "fed up" of Owenson and Costello and stopped giving them payments for a short period.

He later revealed he came under pressure because ABC was losing business and jobs were being allocated to other contractors and the bribes resumed.

Glass on head

Apart from cash bribes, more than £30,000 was spent by the firm at hospitality events attended by Owenson and Costello, although others were also present.

"One witness states that Costello bragged about the money being spent by ABC and on one occasion claimed a night out he had attended must have cost ABC £5,000," the fiscal said.

During one outing, Costello placed his empty glass on his head indicating it was time that someone from ABC bought him another drink.

The court heard that between December 2006 and November 2010 Balmer received £141,541 in dividends and Cantwell £135,071.

The Crown has raised proceedings to recover crime profits in the case.

Defence solicitor advocate Maurice Smyth, for Owenson, said: "He had no say as to what money he should receive or when. He didn't think he was hurting the council. He thought he was ensuring the council got the best."

He maintained that Owenson was motivated by the best interests of the local authority and that ABC were "the complete answer" for the council's property care services.

"Dealing with sub contractors and a myriad of firms only piled on the costs," he told the court.

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