The Brothel of Bedford: The Prostitution Bust and the Corrupt Officials Who Went Down with It 

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The prosecutor's office declined to comment beyond the usual press release recitations, citing the ongoing investigation. Rumors roll in Bedford's tight circles that Jimmy Dimora, no stranger to the oldest profession in the world himself, who was summoned back to Cuyahoga County back in August (a month before the raid) for presumed talks with the prosecutors in other cases, may have had some information on the brothel, but that's nothing more than rumor. Ken Schuman's brother, Brian, cooperated with federal prosecutors against Dimora for a lesser sentence for his role in paying bribes for county contracts for the Cleveland halfway house he was running.

"I haven't heard that," Nietert says about Dimora possibly giving information on Schuman, Jacob and the Walsh ring. "That's completely new to me."

In addition to accusing Schuman of soliciting prostitutes and trying to mislead investigators looking into Jim Walsh, in the December indictment, Ken Schuman is charged with bribery, having an unlawful interest in a public contract, soliciting or receiving improper compensation and money laundering going back to 2006 when he accepted a $9,500 bribe to influence the hiring of Anthony Calabrese III -- later sentenced in the federal corruption probe -- as Bedford's bond counsel, prosecutors say (read his indictment here). He's also accused of using Bedford city employees "to do work for his outside law practice and to run personal errands on city time." He also was the law director in the tiny village of Bentleyville and did law work for Maple Heights and Bedford Heights.

The Bust

In the first half of 2012, family members of a Studio 54 worker and people from child protective services told Bedford police that prostitution was happening on the third floor of the Walsh building. In July of that year, they responded to an overdose of one of the prostitutes there, finding heroin and abortion drugs nearby. None of that was enough for police to start an investigation, chief Nietert said.

All indications are that the investigation began in 2013, not when authorities responded to the overdose like the prosecutor's office said in a press release. What finally gave police enough to go off of?

"I can't lay it out for you, not at this point," Nietert says. "But you start using other investigative tools and it leads to where you need to be to make your case. You get to a point where you realize that, yeah, there's probably something there, and you've got to get in to be able to do it."

Nietert says he went to the county "at some point" in 2013, before the September raid, when the scope of what he learned of the operation expanded from just prostitution to involving money laundering and other financial crime.

"The financial aspect -- we don't have a financial expert here," says Nietert about Bedford. "Somebody who has access to records and is able to analyze them and determine where money is moving to and from. The county and federal government have people who are skilled in that."

Things moved quickly once he reached out. The Walsh building was raided on Sept. 30. "Michelle," the Studio 54 worker, was there.

"I was in my room with a client doing a massage," she says. "I heard a banging off in the distance and then moments later they were banging on my door. I put my robe on and opened my door, they were standing there with their guns drawn and they snatched me up and took me to the front office and took the client to the back."

She remembers Bedford police officers and FBI agents conducting the raid, some in uniform and some in plain clothes. A press release from the county prosecutor says agents from the U.S. Secret Service and the Internal Revenue Service were there with the Bedford cops.

"They searched the whole office for hours," she says. "The ceilings, every drawer in every desk. They ordered a pizza in the middle of this. I sat there for nearly three hours before they took me to the police station."

The agents seized "extensive financial records," including records of everyone who paid with a credit card, during the raid, according to the press release. Records he kept hidden in a safe were seized from his old house where his wife was living. At the Walsh building, computers, external hard drives, cell phones, surveillance footage DVDs, "a pair of panties & mesh negligees" and dozens of other items were taken. Authorities took more than $6,000 in cash, along with Walsh's 2008 GMC Yukon with his "JWALSH" plates.

Pictures, obtained from a source by Scene, of Jim Walsh's office on the third floor shortly after the raid show the ceiling was a focus of attention. The police received information that heroin and other drugs were being trafficked in and out of the building, and it would be hidden in the ceiling.

Investigators from the city and county took several, if not all, of the the women in for questioning. Michelle said she was kept in the police station for three full days, where she was questioned by investigators about the operation. They let her go after three days with no charges, and no threat of charges hoping for cooperation in the prosecution of the case: "No agreement, they just questioned me and let me go. They didn't want the girls, they wanted Jim Walsh." Jaworski, living in Streetsboro at that point, was picked up and taken to downtown Cleveland to be questioned about Jacob.

During the Sept. 30 raid, Jacob and Schuman were still working in Bedford, but the investigation was still churning.

When both of their indictments were handed down in December, it accused Schuman of felony obstruction of justice. In a Cuyahoga County courtroom three weeks ago, assistant prosecutor Matthew Meyer said Schuman interfered with a Bedford police investigation "on behalf of a woman with whom he had a relationship."  He also faces a first degree misdemeanor from the same day for "falsification": making false statements "with the purpose to mislead a public official in performing the public official's official function."

On Oct. 13, even after the Walsh bust and at least with the knowledge that investigators were seriously looking into the Bedford organization, prosecutors say Schuman solicited "Jane Doe 1 to engage in sexual activity for hire."

Chief Nietert claims he didn't know Schuman and Jacob were involved until after the investigation began. "You just don't anticipate those are the types of people you are going to find involved," he says. "Things like that just add more work, to be honest. It creates a whole new problem for your investigation because now you have other things you have to look at. You can't just not look at it."

Jacob took a "medical leave" from the municipal court on Nov. 12. Schuman followed suit nine days later.

The investigation is still ongoing. A new batch of subpoenas were delivered to Bedford a week and a half ago (the city refused to release those; previous subpoenas were only released after dogged reporting and requests from the Plain Dealer's Rachel Dissell and involvement of their lawyer), and Nietert said there are detectives still working the case everyday.

And more people will be going down.

"There's an entire operation happening behind the scenes," he says. "It's an entire operation that probably has more significance and ramification than the charging of a judge and a prostitute. Sure it's an interesting topic, but it's only a small piece of the entire puzzle."

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