Former Rep. Palumbo Arrested for Embezzling from Campaign Account

Former Rep. Palumbo Arrested for Embezzling from Campaign Account

Former State Representative Peter Palumbo was arrested by the Rhode Island State Police on charges of embezzling $59,000 from his campaign account.

The announcement is the latest in a line of controversies surrounding the former Cranston legislator, who in 2014 was the subject of an ethics complaint. 

Palumbo had reportedly been the high bidder on 3 state beach contracts, but withdrew his bid and was instead hired to manage the operations by the second highest bidder, David Caprio -- who ultimately resigned his position as Democratic State Party Chairman. 

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Charged with Embezzlement

The Rhode Island State Police made the following announcement on Thursday:

Colonel Ann C. Assumpico, Superintendent of the Rhode Island State Police and Director of the Department of Public Safety, announces the arrest of Peter Palumbo, age 54, of 67 Kearney Street, Cranston, RI, a former Member of the House of Representatives for the State of Rhode Island, for embezzling money from his campaign finance fund.

This investigation by members of the Financial Crimes Unit, with the assistance of the Rhode Island Attorney General's Office, was initiated as a result of an audit conducted by the Board of Elections into the campaign finances of former State of Rhode Island Representative Peter Palumbo, District 16, in the City of Cranston. 

The Board of Elections audit revealed that Mr. Palumbo was not accounting for approximately $59,000 in cash withdrawals from the campaign funds. A further review revealed that Mr. Palumbo withdrew approximately $16,000 from ATMs at seven different casinos around the country over the course of five years.

Mr. Palumbo was arrested this morning on an Affidavit/ Arrest Warrant for Embezzlement and Filing a False Document with a Public Official. After processing at State Police Headquarters, Mr. Palumbo will be transported and arraigned at Sixth Division District Court, One Dorrance Plaza, Providence, RI.

Editor's Note: The RISP clarified that the $16,000 was a subset of the $59,000, not in addition to that. An earlier version of the story has been updated.