American Traffic Solutions photo
An Arizona company that makes traffic cameras may have systematically bribed public officials, including some in Massachusetts, in exchange for contracts, according to a lawsuit filed by a former employee.
Aaron Rosenberg, the one-time executive vice president of sales for Redflex Traffic Systems, claimed in court filings that he was “carrying out orders” from the company’s executives and Board of Directors when he bribed officials in at least 13 states, including Massachusetts.
Redflex, which denies Roesenberg’s claims, had a company-wide practice of “lavishly providing customers, including government officials, with perquisites and gifts in various forms,” Rosenberg claimed in suit against the company. He said the bribes often took the form of meals, golf outings and tickets to sporting events.
Redflex executives set aside money for bribes in the “entertainment” expense category of the company’s annual budget, Rosenberg said.
“There was never a distinction between those types of entertainment expenses and expenses that are considered gratuities and bribes,” he claimed in the suit.
Redflex fired Rosenberg and five other executives last February, after the Chicago Tribune reported that money and bribes had been flowing from the company to a city official in charge of Chicago’s traffic camera program. In a suit filed in Arizona the same month, the company blamed Rosenberg for the scheme.
In October, Rosenberg countersued the company, claiming Redflex had defamed him by alleging he was solely responsible for the bribes.
Rosenberg did not name specific officials or municipalities that received bribes in his countersuit. He said he was cooperating with authorities investigating Redflex.
In December 2006, Redflex signed a three year contract with Saugus to install traffic cameras at up to 10 intersections in the town, according to the company’s SEC filings. The cameras were designed to capture the license plate numbers of cars that sped through red lights.
They were never installed, however, and Redflex was never paid because the state legislature did not pass legislation allowing the town to use the cameras, said Andrew Bisignani, who was Saugus’ town manager at the time.
“I can tell you that [bribery] never happened with us, it was all above board,” he said. “It was a very transparent process.”
Saugus’ police department, fire department, and Board of Selectmen all signed off on the Redflex contract before it was finalized, Bisignani said.
As of 2008, the last year Redflex submitted SEC filings, Saugus was the only municipality in Massachusetts to contract with the company.
Redflex vehemently denied Rosenberg’s accusations in a statement released last month.
“Redflex will aggressively defend itself against the allegations as well as prosecute its claims against the former executive,” the company said. “We are committed to transparency and honesty in our business practices. Our focus continues to be on providing best in class customer service and technology to our clients to make their communities safer.”