The Leak That Burned the City: How McCann Framed Flores and Brought Lorain to the Brink
A decade-old leak, a cover-up at the highest levels, and the federal audit that exposed it all. This is the real story behind Lorain’s housing collapse and the political sabotage that protected it.
By Aaron C. Knapp | Lorain Politics Unplugged
Introduction
For years, whispers circulated through Lorain’s City Hall. Whispers of missing money, rigged loan programs, and vendettas disguised as investigations.
In 2013, when Councilman Dennis Flores’s emails were subpoenaed as part of an internal affairs leak probe, the official line was that Flores might have exposed misconduct within the Lorain Police Department. But now, a different picture emerges—one where the leak came from inside the department, orchestrated by none other than then-Captain James McCann. Flores wasn’t the leaker. He was the scapegoat.
This exposé reveals how McCann, now Chief of Police, manipulated an internal crisis to consolidate power, target political opponents, and distract from the real scandal: a multi-million-dollar collapse of Lorain’s federally funded housing programs that he helped shield from public view. In what follows, we’ll explore the paper trail, examine the real source of the leak, and trace how the city allowed the framing of one of its own elected officials to protect the ascension of one of its most dangerous.
McCann and the Leak
In late 2012, Lorain Police Department was in quiet turmoil. Sgt. Jeff Jackson had allegedly manipulated his time logs for financial benefit, and Officer Ralph Gonzalez claimed that department-issued firearms were destroyed in a suspicious house fire. Both incidents demanded scrutiny, and both became subjects of internal affairs investigations. However, something unusual happened. The contents of those confidential disciplinary files made their way into public discourse—and into the hands of media.
As the community began asking questions, the department—under pressure—initiated a leak investigation. Dennis Flores, a sitting councilman known for his sharp criticism of the department and unwavering independence, became the focus. His personal email and phone records were subpoenaed. Flores became the face of the scandal. But inside sources at the time pointed fingers elsewhere: toward then-Captain James McCann.
McCann, who had access to the files and oversight authority, stood to benefit if public pressure focused away from the command structure and internal dysfunction. According to two retired officers who spoke on background, McCann was known for "tight control and tight circles." He allegedly oversaw the selective distribution of internal materials and may have been the person who allowed the leak to occur, only to weaponize the investigation against Flores.
As one insider put it, "The files didn’t walk themselves out of headquarters. Someone in brass opened the door."
The 2014 Chronicle-Telegram headline “Leak probe doesn’t ID source” concealed more than it revealed. Investigators publicly failed to name a culprit. Privately, city officials had growing suspicion that McCann had orchestrated the release.
Internal memos, which have never been made public but were referenced in a 2015 closed session, reportedly show that McCann had both knowledge of and access to the compromised documents. Despite this, no action was taken.
To further complicate matters, McCann reportedly worked behind the scenes to deepen suspicion against Flores.
Emails between McCann and then-Safety Director R. Michael Fowler include language that appears to preemptively position Flores as the likely culprit, even as no evidence supported that claim. The targeting of Flores was seen by many as a political move—Flores had criticized mismanagement in both police and housing sectors. Removing him from influence would silence a significant dissenting voice.
The fact that Flores had supported some Republican candidates in prior elections made him an outlier in an otherwise Democrat-heavy landscape. McCann and his allies exploited that, feeding narratives that Flores was acting out of partisan malice rather than concern for the public.
The truth, however, was that Flores had been one of the few local officials calling attention to financial mismanagement and demanding reform long before the leak.
In hindsight, the timing of the leak and the ferocity of the response against Flores appear strategic. While Flores was being framed, McCann was quietly gaining more internal power.
Within two years, he would become Chief. His pathway was cleared not through reform but through the political neutralization of his biggest obstacle. What McCann needed was an enemy. What he chose was Flores.
This framing operation served a dual purpose: it undermined a critic while reinforcing McCann’s reputation as a fixer. He cast himself as the leader who would stop future leaks, clean up corruption, and "restore order." But the records now tell a different story. McCann wasn’t cleaning house. He was flipping the lights off.
HUD Steps In: The Real Scandal
As the city busied itself with the leak investigation, a much larger failure was unfolding under its nose. In 2016 and 2017, the U.S. Department of Housing and Urban Development (HUD) conducted a series of audits into Lorain’s Community Development Block Grant (CDBG) and HOME programs. The findings were staggering. HUD identified three major failures, including a complete breakdown in the city’s management of its Economic Development Revolving Loan Fund.
Thirteen out of fifteen reviewed loan files were deemed ineligible. HUD found no evidence of job creation, no documentation of economic benefit, and no proper tracking of public money. These loans, which were supposed to help small businesses and disadvantaged residents, instead went to insiders, political allies, and former board members. Some were even used to purchase city-owned property, raising significant conflict of interest concerns.
Meanwhile, the city lost over $2.3 million in federal housing money due to inactivity, unspent funds, and project failures.
HUD officials described the documentation as "nonexistent" and confirmed that the city lacked even the most basic internal policies for fund management. No one could say with certainty where the money had gone or whether any benefit had been achieved.
This catastrophic financial failure went largely unnoticed in local media at the time. That’s no accident. The spotlight was on the Flores leak scandal—a controversy driven by McCann and echoed in council meetings and law enforcement briefings. But while the public was watching Flores, the city’s housing infrastructure was collapsing under years of mismanagement.
HUD took the rare step of ordering Lorain to immediately suspend the revolving loan fund. The official letter read: “We are instructing the City to suspend the revolving loan program at this time and until a suitable replacement organization can be found to administer the program.” Behind the scenes, HUD officers expressed concern that Lorain’s leadership had deliberately deflected attention from financial mismanagement by focusing on political infighting.
In fact, one former HUD staffer, speaking on condition of anonymity, told us, "I remember hearing about the Flores thing while we were reviewing the loan files. It was bizarre how much focus there was on a councilman when millions in housing money were falling apart. It smelled political."
The damning reality is this: while McCann and his allies were feeding narratives about Flores being untrustworthy, the real betrayal was happening in plain sight. It wasn’t an errant email from a councilman that lost Lorain its federal dollars. It was years of unchecked rot.
What’s more troubling is that much of this mismanagement occurred during the very period that McCann was consolidating power and building influence within city leadership. His silence on the HUD audits was deafening. He was quick to accuse Flores but nowhere to be found when it came time to address financial accountability in the departments he now oversees.
The parallel timing of Flores’s political humiliation and HUD’s damning reports is more than coincidence. It is evidence of a deliberate smokescreen—a political operation that protected the city’s most powerful while throwing its most principled under the bus.
The Setup
The groundwork for this political framing began long before the subpoena hit Flores’s inbox. In fact, tensions between the councilman and Lorain's police leadership had been growing for years.
Flores had been one of the few elected officials openly critical of both fiscal irresponsibility and unchecked law enforcement power. He often spoke up during council sessions about the need for accountability and transparency, particularly in areas involving police discipline and community reinvestment. His questions weren’t welcomed; they were viewed as disruptive.
Behind the scenes, McCann, then still an upper-level officer, had grown increasingly wary of Flores’s influence. According to testimony from a former city administrator, McCann referred to Flores as “a liability to the department.” In private strategy sessions with other city officials, McCann reportedly floated the idea that Flores might be leaking information to the media—not based on evidence, but on the fact that he was outspoken. That narrative would later serve as the justification for the sweeping subpoenas that followed.
Flores’s independent streak had made him few friends in city government. He was not seen as a team player. He challenged contracts, questioned audits, and objected to rubber-stamping budgets. In a city plagued by insiders protecting insiders, Flores was an anomaly—and a threat. When the misconduct cases against Jackson and Gonzalez began swirling in internal affairs,
McCann knew that documents would need to be tightly controlled. But instead of controlling them, he may have selectively released them.
The supposed leak came at a perfect time to derail Flores. In early 2013, he was gaining support for a council resolution aimed at increasing transparency in how city contracts were awarded. The measure, had it passed, would have required disclosure of any prior relationships between contractors and city officials. That alone was enough to make Flores dangerous to the entrenched status quo.
By positioning Flores as the source of a leak—particularly one involving law enforcement—McCann created a political bombshell that not only smeared a rival but also bolstered his own credibility within the department. The very person who had reason to expose misconduct was being painted as reckless and unethical. McCann, by contrast, could pose as the guardian of departmental integrity.
When the Chronicle-Telegram published a 2014 editorial cartoon mocking Flores as the cause of the internal affairs leak, the damage was complete. Public opinion had shifted. Most residents didn’t know that the actual investigation failed to uncover any proof against Flores. Nor did they know that the supposed “leak” appeared to originate from someone who stood to gain power from Flores’s fall. The public only saw a scandal—and McCann made sure they saw it unfold just the way he wanted.
In interviews we conducted with individuals close to the events, a consistent theme emerged: McCann was always three steps ahead. He had the institutional knowledge and relationships to shape internal narratives. He knew how to use both rumor and bureaucracy as weapons. He understood that in a town like Lorain, where political memory is short and institutional protection runs deep, a lie could carry further than any truth.
To build further credibility, McCann doubled down on department control. He made visible moves to increase internal discipline policies—some of which were long overdue—but they also served as convenient cover for his power grab. Those inside the department noted that while some officers were punished quickly for infractions, others with ties to McCann were quietly shielded. That pattern would mirror what HUD would later find in the city’s revolving loan program.
Even as the federal audits began exposing the rot beneath Lorain’s financial programs, McCann was nowhere to be found calling for accountability. That silence spoke volumes. By then, Flores had already been politically neutered. McCann had already risen. And the city's internal watchdogs, having been misled, stayed focused on the wrong man.
The setup worked. Flores, though never formally charged, carried the stigma of the leak. He was denied committee influence, sidelined during policy debates, and cut out of financial planning sessions. The city had successfully silenced its loudest critic—and no one paid a price for the lie that brought him down.
Federal Suspension Fallout
The long-term consequences of Lorain’s housing program failures did not end with a HUD letter or two. They reverberated through the community in missed services, halted development, and rising distrust. The $2.3 million lost wasn’t just a number—it was a betrayal. Those funds were meant to support housing rehabilitation, rental assistance, and emergency repair services for Lorain’s poorest residents. When that money vanished, so did the city’s credibility.
Residents who had once qualified for repair grants were suddenly told the funds had run dry. Projects that had been approved were stalled or abandoned. Small business owners, many of whom had applied for economic development loans through the city’s revolving loan fund, found their applications indefinitely frozen. Nonprofits that relied on CDBG partnerships were forced to scale back or shutter entirely. The community bore the brunt of the fallout, while city officials offered excuses and vague timelines.
HUD’s directive to suspend the loan program came with an expectation: that Lorain would conduct a comprehensive review of every loan issued through the Lorain Development Corporation. But no such review has been made public. The few internal memos obtained through public records requests suggest confusion and resistance rather than action. There were no consequences for those who approved the flawed loans. No resignations. No firings. No public apology.
What did emerge was a quiet shift in how city leadership described the problem. McCann and others began characterizing the HUD findings as “administrative oversights” rather than what they were—gross negligence and probable misconduct. This reframing effort mirrored the earlier spin campaign against Flores. Where accountability was needed, Lorain’s leaders delivered PR.
Meanwhile, community trust in local government continued to deteriorate. At neighborhood meetings, residents raised questions about where the money went and who had benefited. Names of loan recipients—some of whom were politically connected—began to circulate. Speculation grew that some of the loans were never intended to produce jobs or public benefit but were instead favors to friends or political allies.
That speculation wasn’t baseless. In one case, HUD noted that a loan was used to help an individual purchase property from the city—a self-dealing transaction that raised ethical and legal red flags. In another, loans were extended to a nonprofit whose director also sat on the approving board. These were not accidents. They were features of a system that had been allowed to operate in the shadows.
Throughout all of this, Chief McCann remained publicly silent. While he had no direct oversight of the housing department, his influence within city hall and his alliance with the officials managing those programs made him one of the few people who could have demanded a reckoning. He chose not to.
Instead, McCann focused his energy on internal police matters, pushing reforms that conveniently avoided any mention of the earlier leak investigation or the retaliatory effort against Flores. In a city that needed transparency, McCann offered tightened control. In a city that needed accountability, he delivered selective enforcement.
The federal audits should have been a turning point for Lorain. They should have triggered resignations, reforms, and a reckoning with the city’s institutional culture. But because the narrative had been so effectively redirected toward the scapegoating of Dennis Flores, the real story was buried beneath layers of misinformation. And the rot was allowed to remain.
Conclusion: Smoke, Mirrors, and McCann
James McCann's rise to power was not marked by heroism or reform—it was built on sleight of hand. He orchestrated a diversion so convincing that the public turned against one of the few men trying to do right by the city. He used institutional suspicion, political timing, and a friendly press cycle to paint Dennis Flores as a villain, even while standing atop a collapsing foundation of fraud and failed oversight.
The leak that led to the subpoena of Flores was never solved because it was never meant to be. It wasn’t an investigation—it was a setup. The real story was never about emails or records. It was about removing an obstacle to power and protecting a fragile political ecosystem built on silence, loyalty, and backroom deals.
HUD’s findings, while damning, were not treated as catalysts for reform. They were framed as bureaucratic hiccups. The people responsible were never held accountable. And the community, desperate for answers, was left with few explanations and even fewer options.
This is Lorain’s tragedy: not simply that funds were lost or that programs failed, but that the very individuals in power redirected attention toward false enemies while shielding the guilty. McCann's hands were never clean—but they were always gloved, always protected by the apparatus of a city that rewards loyalty over honesty.
The consequences of this deception still ripple through city government. Policies remain uncorrected. Audits go unanswered. And voices like Flores’s remain silenced, long after the headlines faded. But the facts remain, buried in HUD reports and archived subpoenas—ready for those willing to look.
Lorain cannot heal until it faces the truth of what happened. And the truth is this: McCann didn’t just inherit a broken system. He helped break it. And he did so while the city watched, distracted by the smoke and mirrors he so expertly deployed.
Now that the truth is coming into focus, the question for Lorain is no longer what happened. It is whether we will demand something better, or once again be fooled by the next trick.
Documents reviewed: 2016 HUD Monitoring Report (June 14, 2016); 2017 HUD Year-End Assessment (May 22, 2017); internal communications; 2014 Chronicle-Telegram article; subpoena records involving Councilman Dennis Flores.