July 25, 2014 SIGN IN | REGISTER

FBI Saw Dark Side of Rep. John Murtha

Douglas Graham/CQ Roll Call File Photo
Neither Rep. John Murtha nor anybody from KSA Consulting was ever charged with a crime, and it is unclear what happened to the FBI’s investigation.

Neither Murtha nor anybody from KSA was ever charged with a crime, and it is unclear what happened to the investigation.

A Nonprofit Called PAID

The best place to understand the FBI’s theory of the case is a defunct nonprofit called the Pennsylvania Association for Individuals with Disabilities, which had as its mission helping people with disabilities find employment.

Murtha announced the creation of PAID on June 1, 2001, saying that Aeptec Microsystems Inc., a company that he helped bring to western Pennsylvania, would be opening a new headquarters and hiring two clients of the new organization. The company had just hired KSA Consulting as its lobbying firm. Murtha was the honorary chairman of PAID, and his longtime defense appropriations aide, Scialabba, was listed as the founder of the group.

PAID’s board of directors was a who’s who of lobbyists connected to Murtha, as well as executives from firms that had received Murtha earmarks, including KSA founder Ken Stalder. In May 2002, David Fyock, CEO of MountainTop Technologies, a Johnstown firm that received many Murtha earmarks, testified before Congress in his capacity as the vice president of PAID. In an odd quirk of timing, the Justice Department inspector general released a report Monday concluding that while MountainTop had a federal grant to distribute resources to local police departments, Murtha’s office actually made the decisions about which departments got funding, and MountainTop served simply as a “pass through.” The IG report was first reported by the website Main Justice.

Scialabba left Murtha’s office at the end of 2002, according to Congressional pay records maintained by LegiStorm. By Dec. 1, 2002, he was registered as a lobbyist at KSA.

Roll Call investigated PAID in 2007 and could find little evidence that the group was doing anything. A spokeswoman for the U.S. Department of Labor told Roll Call that PAID had received $650,000 in “earmark grants” sponsored by Murtha in 2003 and 2004, but the group’s access to the funding was restricted because PAID had significant turnover and “did not have anyone qualified to make decisions or sign off on invoices.”

The FBI thought PAID may have been set up simply to provide a financial cushion for Scialabba, who was apparently having financial troubles. While the names in the documents obtained by CREW are redacted, the description matches Scialabba, and tax liens noted in the document match liens against Scialabba. “If PAID was set-up for the purpose of unjustly enriching [Scialabba], it appears that [Scialabba] and Murtha may have engaged in a conspiracy that could potentially violate federal statutes,” the FBI file reads.

Federal tax forms filed by PAID do not indicate any salary for Scialabba, so it is not clear how the group might have benefited him.

PAID is no longer in business. Its phone has been disconnected, and a receptionist in the building where the group had its office said that PAID moved out in February 2010 — the same month Murtha died.

Scialabba has never been charged in the case, and phone messages left on what appears to be his home phone were not returned.

Criminal Convictions

Aeptec and KSA were also at the center of the one Murtha earmark that resulted in criminal convictions.

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