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WILKES-BARRE — Federal prosecutors have agreed to drop bank fraud charges against Leo A. Glodzik III as part of a deal that will see the embattled former city towing contractor plead guilty to a new set of charges.

Glodzik, 45, of 1009 Morgan Drive, Wilkes-Barre, was charged in a new criminal information Thursday with mail fraud, being a felon in possession of a firearm and filing false tax returns as a result of an exclusive towing contract between Glodzik’s LAG Transport, Inc., and the City of Wilkes-Barre, the U.S. Attorney’s Office announced.

Glodzik is also charged in the new criminal information with being a convicted felon in possession of a firearm. The charge was part of an indictment previously returned by a federal grand jury in April.

Prosecutors say bank fraud charges in the Wilkes-Barre City Employees Federal Credit Union case will be dismissed in exchange for Glodzik’s plea.

Glodzik’s attorney, Joseph F. Sklarosky Sr., did not immediately return a message seeking comment.

A court date for entering the plea has yet to be scheduled.

The charges allege Glodzik concocted a scheme to rip off vehicle owners by charging excessive fees or by hindering access to vehicles that were placed in storage in an effort to extract additional fees. To discharge the fees, owners would sign over their title to LAG or Glodzik.

Prosecutors say Glodzik then used procedures administered through PennDOT to transfer the vehicles’ ownership, but claimed in forms submitted through the U.S. Postal Service the vehicles’ values were much lower than their actual cost. The action resulted in Glodzik being able to avoid legal advertisement of abandoned vehicles and payments to the state of money received for vehicles sold at auctions that were above and beyond Glodzik’s own business costs, making Glodzik a profit in the process, prosecutors allege.

Glodzik falsified his tax return when he claimed zero taxable income in 2008 when, in fact, his actual taxable income for that year was allegedly $408,618, according to prosecutors.

He faces a maximum penalty of 33 years in prison and/or fines totaling $750,000, as well as three years supervised release, prosecution costs, denial of benefits and a $300 assessment, prosecutors said.

City officials for years had raised concerns about Glodzik and LAG’s exclusive contract with the city.

“There was a lot of red flags,” recalled Mayor Tony George.

The former city councilman said he’d heard complaints from people who dealt with LAG and brought them up at council meetings. At one point, he was called into City Hall and told to leave Glodzik and LAG alone, he told the Times Leader Thursday. Yet he pushed for records that were supposed to be provided monthly to the city by LAG and was told there weren’t any.

“That’s the biggest red flag there is,” George said. “How can you not have records?”

It wasn’t his intent to have Glodzik arrested or charged, George said.

“I just wanted him to get out of the contract,” George said. “I thought he was taking advantage of the people he was towing.”

On the opposite side of the railing separating council from the public, City Wide Towing owner Bob Kadluboski often spoke out against Glodzik and the administration of former Mayor Tom Leighton on the LAG contract.

Kadluboski had the contract before LAG.

“Leo Glodzik did not get away with his scheme by himself,” Kadluboski said. “There’s more people involved.”

Kadluboski said he intends to bring “some concerns” to the attention of U.S. Attorney Peter Smith in Scranton next week. Kadluboski added that he will have more to say in a press conference next week with Frank Sorick, president of the Wilkes-Barre City Taxpayers Association.

Despite resistance from prosecutors, a Luzerne County judge on Sept. 22 granted parole to Glodzik and granted him release from Luzerne County Correctional Facility, where he was being held for a theft conviction since June.

A county jury in May 2014 convicted Glodzik of allegations he stole $2,100 in bait money that he believed to be seized drug money and tried to share part of the cash with a state trooper posing as a “dirty” cop.

Glodzik’s trial on the bank fraud charges was scheduled to begin Monday.

According to the indictment in that case, former Wilkes-Barre City Employee Federal Credit Union assistant manager Amanda Magda in March 2012 witnessed a loan document for former city police officer Tino Ninotti which he acquired using the signature of his brother, Dino, who was in Afghanistan at the time.

Tino Ninotti said the loan would be used to purchase a Dodge Ram pickup truck from Glodzik, prosecutors say. However, the money was never put to such use and the vehicle identification number (VIN) associated with the vehicle, provided to the credit union by Ninotti, proved fraudulent.

Further, the VIN associated with a vehicle Ninotti used as collateral was fraudulent as well, prosecutors say. Glodzik allegedly provided Ninotti with both numbers.

A federal grand jury indicted Magda, Ninotti and Glodzik, along with former city police officer Jason Anthony and credit union member Jeffrey Serafin, in August 2014.

The conviction cost Glodzik his towing contract with the city.

Ninotti, Anthony and Serafin pleaded guilty to conspiring to commit bank fraud.

Serafin was sentenced to time served and three years supervised release, while sentencings for Ninnoti and Anthony were continued earlier this week.

The new plea agreement, meanwhile, says prosecutors won’t pursue further criminal charges against Glodzik regarding the credit union case, effectively ending years of legal sparring between Glodzik and authorities.

Travis Kellar, staff writer, contributed to this report.

Tow truck driver Leo Glodzik III walks to his sentencing on theft charges in May 2014 at the Luzerne County Courthouse in Wilkes-Barre. Glodzik is now expected to plead guilty to federal mail fraud, tax evasion and weapons charges under an agreement with authorities to avoid further prosecution in a case involving the Wilkes-Barre City Employee Federal Credit Union.
https://www.timesleader.com/wp-content/uploads/2016/03/web1_Leo-Glodzik-5-15-14-6.jpg.optimal.jpgTow truck driver Leo Glodzik III walks to his sentencing on theft charges in May 2014 at the Luzerne County Courthouse in Wilkes-Barre. Glodzik is now expected to plead guilty to federal mail fraud, tax evasion and weapons charges under an agreement with authorities to avoid further prosecution in a case involving the Wilkes-Barre City Employee Federal Credit Union.

By Joe Dolinsky and Jerry Lynott

[email protected] and [email protected]

Reach Joe Dolinsky at 570-991-6110 or on Twitter @JoeDolinsky TL and reach Jerry Lynott at 570-991-6120 or on Twitter @TLJerryLynott.