NEWARK – Former New Jersey State Senator John A. Lynch pleaded guilty today, admitting that he took concealed corrupt payments that were passed through two consulting companies, and that those payments were financed by a South Brunswick sand-mining company in return for Lynch’s official action and influence as a senator, U.S. Attorney Christopher J. Christie announced.

Lynch, 67, of New Brunswick, pleaded guilty to one count of mail fraud (defrauding the public of his honest services), and to one count of tax evasion for tax year 1999. John E. “Jack” Westlake, 76, of Red Bank, a close business associate involved in the two consulting companies with Lynch, pleaded guilty as well, to one count of tax evasion.

Under the advisory U.S. Sentencing Guidelines, Lynch faces a probable sentencing range of between 33 and 41 months in federal prison. Westlake faces a probable range of between 10 and 16 months in prison. However, the sentencing guidelines are only advisory, and U.S. District Judge Stanley R. Chesler, who took the pleas, has wide discretion to sentence within, above or below those ranges. Judge Chesler scheduled sentencing for both men for Dec. 19. Lynch and Westlake were released pending sentencing on $100,000 personal recognizance bonds.

“Today an era of corruption and influence peddling for personal profit has been put to an end,” Christie said. “There is no one in this state, no matter how powerful, who is above the law.”

Lynch and Westlake used two companies, both with offices in Red Bank, to perpetrate the fraud and hide the corrupt payments passing through to Lynch. One was Executive Continental, which was incorporated in New Jersey in May 1993; the other was Alma Limited, Inc., incorporated in New Jersey in September 1993.

Both companies purported to provide consulting services to various developers, other individuals and entities involved in proposed or ongoing development projects in New Jersey. Lynch and Westlake were both 50 percent partners in Executive Continental, while Westlake was the sole shareholder of Alma.

According to the criminal Information to which Lynch pleaded guilty, a South Brunswick company in the business of mining sand for use in construction products (the “Sand Company”) hired Alma. In 1995, the Sand Company sought rights to mine state-owned property next to its own property in South Brunswick. The land, after being mined, was to be turned into a park and revert to the state. To do all this, the Sand Company needed approvals from the state Department of Environmental Protection (DEP), and turned to Alma for assistance.

Lynch, a state Senator from 1982 to 2002, then wrote letters on official Senate letterhead vouching for the Sand Company. On March 2, 1998, for example, Lynch – as he admitted today in court – wrote to the commissioner of the DEP supporting the Sand Company and speaking favorably about the company’s park plan. The company’s proposal, he said in the letter, had “great appeal to the general public.”

Lynch wrote a second letter on Dec. 3, 1998, this time to the deputy commissioner of the DEP. In it, he wrote that “as a legislator from Central New Jersey,” he was “very pleased to support the conceptual plan for (the recreational park) advanced by” the Sand Company.

Lynch admitted today that between 1998 and 2002, Alma regularly demanded and received payments from the Sand Company which totaled between approximately $120,000 and $200,000. He admitted that a portion of that money passed to him through Alma – Westlake’s company – to Executive Continental, owned by both men, and then on to Lynch.

For example, Lynch admitted that he received a $7,500 check dated June 23, 1998, from Executive Continental; a $4,500 check dated June 26, 1998, from Executive Continental; a $10,000 check dated Dec. 31, 1998, from Executive Continental, and a second check dated Dec. 31, 1998, payable to American Express for credit card charges he incurred.

Lynch admitted that he accepted those corrupt payments knowingly and intentionally.

As described in the Information to which Lynch pleaded guilty, demands for payment and invoices from Alma to the Sand Company – many of them sent through the U.S. mail – covered services provided by Lynch but intentionally concealed Lynch’s direct involvement.

One such letter discussed a March 6, 1998 meeting attended by Lynch and the president of the Sand Company, among others where money owed to Alma by the Sand Company was discussed. The letter obscured Lynch’s identity by referring to him only as “our friend.”

In pleading guilty to tax evasion, Lynch admitted that for tax year 1999, he filed an individual tax return on behalf of him and his wife in which he failed to include approximately $150,000 in income. As a result, he admitted, he owes the government an additional tax of between $30,000 and $80,000.

Westlake, in pleading guilty to tax evasion, admitted that for tax year 1999, he filed an individual tax return on behalf of him and his wife in which he failed to include approximately $350,000 in income. As a result, he admitted, he owes the government an additional tax of approximately $75,620.

The statutory maximum penalty for honest services mail fraud is five years in prison and a $250,000 fine. The statutory maximum for tax evasion is five years in prison and a $100,000 fine.

In pleading guilty to an Information, a defendant waives he right to be charged by way an of Indictment and admits guilt.

Christie credited Special Agents of the FBI in Philadelphia, under the direction of Special Agent in Charge J.P. Weiss, as well as Special Agents of the FBI in Newark, under the direction of Special Agent in Charge Leslie G. Wiser; and Special Agents of the Internal Revenue Service Criminal Investigations Division, under the direction of Patricia J. Haynes, of the Newark Field Office.

The case is being prosecuted by Assistant U.S. Attorneys Jeffrey S. Chiesa and Ricardo Solano, Jr., of the U.S. Attorney’s Office Special Prosecutions Division.

Defense Counsel: John Arseneault, Esq., in Chatham, for Lynch; John C. Whipple, Esq., in Morristown, for Westlake.