Gotham Gazette Gotham Gazette is an online publication covering New York policy and politics as well as news on public safety, transportation, education, finance and more. http://www.gothamgazette.com/component/tags/tag/joe-percoco 2018-10-22T01:31:25+00:00 Webmaster webmaster@gothamgazette.com Democratic Attorney General Candidates Seek to Set Themselves Apart During First Televised Debate 2018-08-21T04:00:00+00:00 2018-08-21T04:00:00+00:00 http://www.gothamgazette.com/?id=7877:democratic-attorney-general-candidates-seek-to-set-themselves-apart-during-first-televised-debate Ben Max <p><img src="http://www.gothamgazette.com/images/img-3996.jpg" alt="Democratic attorney general candidates" width="600" height="373" /></p> <p>Democratic AG candidates debate (photo: MNN)</p> <hr /> <p>The four Democratic candidates for New York Attorney General met Tuesday for the first televised debate of their race, agreeing that the next chief legal officer of the state must continue to be a check on President Donald Trump, while also addressing corruption in state government and other areas of reform they would pursue in the role.</p> <p>Each of the four candidates -- New York City Public Advocate Letitia James; U.S. Representative Sean Patrick Maloney; Fordham Law professor Zephyr Teachout; and Leecia Eve, a former aide to Joe Biden, Hillary Clinton, and Governor Andrew Cuomo -- sought to set themselves apart in what appears to be a wide open race for the party nomination, with candidates repeatedly calling themselves the only one in the race with certain qualifications.</p> <p>The debate <a href="https://www.youtube.com/watch?v=05Lge7BKabM" target="_blank" rel="noopener">aired Wednesday</a> evening on Manhattan Neighborhood Network and was moderated by Gotham Gazette editor Ben Max. Democratic voters will choose an attorney general nominee, among other races, on Thursday September 13.<br /> <br />All four candidates promised to ratchet up the already fever pitch with which the New York attorney general’s office is fighting Trump administration policies. On more direct state and local matters, there was also agreed upon acknowledgement of certain problems, such as public corruption and an outdated criminal justice system, but the candidates offered some differences in perspective as they sought to make a winning pitch to voters.</p> <p>Two candidates -- Teachout and Maloney -- made new pledges to release their tax returns in line with what James has done, while two candidates -- Maloney and James -- joined calls by Teachout and Eve for state hearings on sexual harassment. Eve continued to decline to make her tax returns public. All four candidates said that it may be appropriate for further legal investigation into the fact that Cuomo’s former top aide and campaign manager, Joseph Percoco, used his government office while on leave to run Cuomo’s 2014 re-election campaign, information that came to light during Percoco’s recent corruption trial, wherein he was found guilty on several charges.</p> <p>Teachout, who has offered herself as the candidate most independent of Cuomo -- she did challenge him in the 2014 primary, of course -- and of special interests due to her refusal of corporate PAC or LLC funding, said that despite Cuomo’s shuttering of the Moreland Commission to Investigate Public Corruption, the executive order creating it is still on the books, and promised to use its powers if elected Attorney General.</p> <p>“Corruption is really holding us back as a state,” Teachout said. “It’s hurting us. And when the Moreland Commission was shut down four years ago, I spoke out loudly. I actually testified at the Moreland Commission. But actually, I don’t know that all people realize this, Andrew Cuomo shut the Moreland Commission down in a press call. He never formally rescinded Executive Order 106.”</p> <p>James expressed support for the creation of a new Moreland Commission. James, Maloney, and Eve all said that they would push the Legislature to give power to the attorney general to more ably address public corruption without referrals from other entities.</p> <p>“Existing law should be changed to give the attorney general primary criminal jurisdiction over public corruption, period, full stop,” Maloney said. “Shouldn’t be any referrals or anything else, you oughta just go get it and prosecute it. We need to change the law.”</p> <p>Eve said that she would utilize an existing agreement with the state comptroller to refer more investigative matters regarding state funds to the attorney general.</p> <p>“Any time we’re talking about the use of taxpayer funds, whether it is funds used to pay a legislator, whether it’s funds to fund different economic development programs, the authority, the existing authority because of this unprecedented relationship and agreement between the state comptroller and attorney general, gives the current attorney general, gives me as the next attorney general, significant powers to root out corruption,” Eve said.</p> <p>James, who has faced questions about her independence from Cuomo in recent weeks given their cross-endorsement and his help with her fundraising, said that she would be the most diligent addressing public corruption, even if it led to “the second floor,” where the governor’s office is located in the state Capitol. She noted that, while serving in the City Council, she had taken a leading role in uncovering the City Time scandal, which she characterized as “the biggest scandal in the City of New York.” “We recovered $700 million for taxpayers, working with Juan Gonzalez from the Daily News” she said.</p> <p>James also set her sights on what she characterized as unaccountable, opaque public benefit corporations and authorities, which are state run but operate like corporations; examples include the MTA, the Dormitory Authority, and Empire State Development.</p> <p>“It is really critically important that we continue to focus on all of the authorities that continue to exist throughout the State of New York,” James said, “these public benefit corporations that need to be investigated, that focus really on alleged economic development in the State of New York, and that’s what’s critically important.”</p> <p>With the exception of Teachout, each candidate has somewhat close ties to Cuomo: Maloney endorsed Cuomo for reelection and urged Cynthia Nixon not to run against him; Eve headed economic development programming under Cuomo; and James has been endorsed by Cuomo and the State Democratic Party that Cuomo leads. Independence from the governor, who saw two top aides convicted of bribery and bid-rigging this year related to millions of dollars in economic development money, has become a major campaign issue in the attorney general race.</p> <p>Asked whether there should be an investigation into whether Percoco had used state resources for campaign purposes under Cuomo’s supervision, as some of the governor’s critics have called for, <a href="https://www.nytimes.com/2018/08/21/nyregion/cuomo-percoco-democrats-attorney-general.html" target="_blank" rel="noopener">all of the candidates said a variation of yes</a>, with Teachout the most affirmative.</p> <p>The candidates were also asked how they would approach the job of attorney general with regard to investigating financial firms for fraud or other wrongdoing. James had courted controversy when she recently <a href="https://www.nytimes.com/2018/08/14/nyregion/sheriff-wall-street-letitia-james-attorney-general.html" target="_blank" rel="noopener">told The New York Times</a> that she did not want to be known as “the Sheriff on Wall Street,” a statement which propelled criticism from her opponents, who embraced the moniker and did so again Tuesday. At the debate, James reiterated her point, however, even after Eve said that she would want to be known as “the Sheriff of Wall Street.”</p> <p>“No I don’t want to be known as the Sheriff on Wall Street, that’s reserved for someone else,” James said, apparently referring to former Attorney General and Governor Eliot Spitzer. “I want to chart my own path. I want my own title, my own title has always been and will continue to be ‘fighter.’” She proposed strengthening the Martin Act, a 1921 state law that gives the attorney general broad power to investigate financial fraud that was revived by Spitzer. James said she would seek to expand, within her first 100 days in office, the act’s statute of limitations from three years to six years.</p> <p>“You know I want to be called the Sheriff of Wall Street,” Teachout said, claiming that the role of the attorney general as “regulator of last resort” was important with a federal government uninterested in regulating big banks and financial firms.</p> <p>“One of the things I really take from Spitzer’s use of the Martin Act is that was an example of an old tool that hadn’t been used,” Teachout said, “being dusted off and used in new and critical ways to hold Wall Street accountable. That’s the kind of creative lawyering, creative legal strategy, that I as the next sheriff will pursue.”</p> <p>Maloney, too, was quick to rebuke James. “Of course you’re gonna be the sheriff of Wall Street, that’s literally the job,” he said. But like James had explained of her perspective, he made sure to say that he would also be the “sheriff” of such issues as Trump, environmental protection, LGBT equality, and criminal justice reform.</p> <p>The representative from the upper Hudson Valley repeatedly noted that he has fought and beaten Republicans, referencing the fact that he has been elected several times in what is a swing district, and touted his government and management experience. James and Eve also highlighted their work in goverment and overseeing teams of employees, while Teachout focused on her expertise in corruption and law, and her work helping to craft litigation against President Trump for alleged violations of the emoluments clause of the Constitution.</p> <p>During a series of “lightning round” questions with quick answers, James and Maloney both stated for the first time that open, public state hearings should be held regarding sexual harassment in state government and beyond; Teachout and Eve had both said previously that hearings should be held.</p> <p>While James answered that she had released five years of tax returns, and was the only candidate to release returns, Teachout and Maloney each said that they would release five years of tax returns by the end of this week. Eve demurred, saying that she had years of government-mandated financial disclosures publicly available.</p> <p>And when asked which other candidate they would vote for if they couldn’t vote for themselves, Maloney and Teachout each said that they would vote for Eve, while Eve and James said only that they promise to vote for the winner of the Democratic primary. Eve, who has trailed significantly in public polling, may have been the safe choice for Maloney and Teachout, though when <a href="https://www.nytimes.com/2018/08/19/opinion/zephyr-teachout-new-york-attorney-general.html" target="_blank" rel="noopener">The New York Times editorial board endorsed Teachout</a> earlier this week, it also noted Eve as its second choice.</p> <p>When offered the opportunity to cross-examine one opponent, none of the candidates opted to ask a question of James, who has led in that public polling for the race despite a high undecided count; she has the support of most of the party “establishment,” including elected officials, clubs, and labor unions. Instead, two questions were leveled at Maloney, and two at Teachout.</p> <p>Teachout was asked by James about opposition to the NY SAFE Act, a signature Cuomo gun control law, during her 2016 Congressional run, to which Teachout said her opposition was only to the secretive process to its passage, part of a pattern of how business is done in the state Capitol that she has consistently denounced. Teachout was asked by Maloney about a citation she had received from the North Carolina Bar, where she is licensed to practice law, which she said was due to not sharing a change in address during a case.</p> <p>Maloney was asked by Eve about why he had chosen to run simultaneously for attorney general and for his congressional seat, a situation that led fellow member of Congress Kathleen Rice to not seek the nomination for attorney general. Maloney said that a judge had already decided in his favor.</p> <p>Maloney was asked by Teachout about $150,000 he received in donations from eight LLCs connected to the Durst Organization, one of the largest real estate developers in New York City. Maloney first attempted to say that Durst felt he was the most qualified candidate and to deflect to in-kind and super PAC contributions Teachout had received in 2016, but when pressed for a more full response by the moderator, he said that the Durst contributions were a “small part of” his overall fundraising. Maloney had earlier concurred with his opponents that the “LLC loophole,” wherein corporations can give virtually unlimited amounts of money to candidates by forming various limited liability companies, should be closed.</p> <p>Other targets for investigations, lawsuits, and prosecutions specifically named by the candidates included the fossil fuel industry, the pharmaceutical industry, the National Rifle Association, real estate developers, and “bad landlords.” The candidates also said that they would use the bully pulpit to advance civil rights causes, particularly in the realm of criminal justice reform: each candidate said that they believe cash bail should be abolished, and that Mayor Bill de Blasio’s 10-year timeline for closing Rikers Island jails is too long. All four said they will not run for governor, which would separate them from recent attorneys general-turned-governors Spitzer and Cuomo.</p> <p>The Democratic primary for attorney general, governor, lieutenant governor, and state legislative seats, among other races, will be held on Thursday, September 13; the winner of the Democratic primary for attorney general will face Republican Keith Wofford and other candidates in the general election. The Democratic attorney general candidates will meet again for a televised debate on NY1 on Tuesday August 28 at John Jay College. The Manhattan Neighborhood Network debat aired Wednesday and <a href="https://www.youtube.com/watch?v=05Lge7BKabM" target="_blank" rel="noopener">can be watched on YouTube</a>.</p> <p>

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by Ben Brachfeld, Gotham Gazette

Read more by this writer.

</p> <p>Ben Max contributed to this article.</p>
<p><img src="http://www.gothamgazette.com/images/img-3996.jpg" alt="Democratic attorney general candidates" width="600" height="373" /></p> <p>Democratic AG candidates debate (photo: MNN)</p> <hr /> <p>The four Democratic candidates for New York Attorney General met Tuesday for the first televised debate of their race, agreeing that the next chief legal officer of the state must continue to be a check on President Donald Trump, while also addressing corruption in state government and other areas of reform they would pursue in the role.</p> <p>Each of the four candidates -- New York City Public Advocate Letitia James; U.S. Representative Sean Patrick Maloney; Fordham Law professor Zephyr Teachout; and Leecia Eve, a former aide to Joe Biden, Hillary Clinton, and Governor Andrew Cuomo -- sought to set themselves apart in what appears to be a wide open race for the party nomination, with candidates repeatedly calling themselves the only one in the race with certain qualifications.</p> <p>The debate <a href="https://www.youtube.com/watch?v=05Lge7BKabM" target="_blank" rel="noopener">aired Wednesday</a> evening on Manhattan Neighborhood Network and was moderated by Gotham Gazette editor Ben Max. Democratic voters will choose an attorney general nominee, among other races, on Thursday September 13.<br /> <br />All four candidates promised to ratchet up the already fever pitch with which the New York attorney general’s office is fighting Trump administration policies. On more direct state and local matters, there was also agreed upon acknowledgement of certain problems, such as public corruption and an outdated criminal justice system, but the candidates offered some differences in perspective as they sought to make a winning pitch to voters.</p> <p>Two candidates -- Teachout and Maloney -- made new pledges to release their tax returns in line with what James has done, while two candidates -- Maloney and James -- joined calls by Teachout and Eve for state hearings on sexual harassment. Eve continued to decline to make her tax returns public. All four candidates said that it may be appropriate for further legal investigation into the fact that Cuomo’s former top aide and campaign manager, Joseph Percoco, used his government office while on leave to run Cuomo’s 2014 re-election campaign, information that came to light during Percoco’s recent corruption trial, wherein he was found guilty on several charges.</p> <p>Teachout, who has offered herself as the candidate most independent of Cuomo -- she did challenge him in the 2014 primary, of course -- and of special interests due to her refusal of corporate PAC or LLC funding, said that despite Cuomo’s shuttering of the Moreland Commission to Investigate Public Corruption, the executive order creating it is still on the books, and promised to use its powers if elected Attorney General.</p> <p>“Corruption is really holding us back as a state,” Teachout said. “It’s hurting us. And when the Moreland Commission was shut down four years ago, I spoke out loudly. I actually testified at the Moreland Commission. But actually, I don’t know that all people realize this, Andrew Cuomo shut the Moreland Commission down in a press call. He never formally rescinded Executive Order 106.”</p> <p>James expressed support for the creation of a new Moreland Commission. James, Maloney, and Eve all said that they would push the Legislature to give power to the attorney general to more ably address public corruption without referrals from other entities.</p> <p>“Existing law should be changed to give the attorney general primary criminal jurisdiction over public corruption, period, full stop,” Maloney said. “Shouldn’t be any referrals or anything else, you oughta just go get it and prosecute it. We need to change the law.”</p> <p>Eve said that she would utilize an existing agreement with the state comptroller to refer more investigative matters regarding state funds to the attorney general.</p> <p>“Any time we’re talking about the use of taxpayer funds, whether it is funds used to pay a legislator, whether it’s funds to fund different economic development programs, the authority, the existing authority because of this unprecedented relationship and agreement between the state comptroller and attorney general, gives the current attorney general, gives me as the next attorney general, significant powers to root out corruption,” Eve said.</p> <p>James, who has faced questions about her independence from Cuomo in recent weeks given their cross-endorsement and his help with her fundraising, said that she would be the most diligent addressing public corruption, even if it led to “the second floor,” where the governor’s office is located in the state Capitol. She noted that, while serving in the City Council, she had taken a leading role in uncovering the City Time scandal, which she characterized as “the biggest scandal in the City of New York.” “We recovered $700 million for taxpayers, working with Juan Gonzalez from the Daily News” she said.</p> <p>James also set her sights on what she characterized as unaccountable, opaque public benefit corporations and authorities, which are state run but operate like corporations; examples include the MTA, the Dormitory Authority, and Empire State Development.</p> <p>“It is really critically important that we continue to focus on all of the authorities that continue to exist throughout the State of New York,” James said, “these public benefit corporations that need to be investigated, that focus really on alleged economic development in the State of New York, and that’s what’s critically important.”</p> <p>With the exception of Teachout, each candidate has somewhat close ties to Cuomo: Maloney endorsed Cuomo for reelection and urged Cynthia Nixon not to run against him; Eve headed economic development programming under Cuomo; and James has been endorsed by Cuomo and the State Democratic Party that Cuomo leads. Independence from the governor, who saw two top aides convicted of bribery and bid-rigging this year related to millions of dollars in economic development money, has become a major campaign issue in the attorney general race.</p> <p>Asked whether there should be an investigation into whether Percoco had used state resources for campaign purposes under Cuomo’s supervision, as some of the governor’s critics have called for, <a href="https://www.nytimes.com/2018/08/21/nyregion/cuomo-percoco-democrats-attorney-general.html" target="_blank" rel="noopener">all of the candidates said a variation of yes</a>, with Teachout the most affirmative.</p> <p>The candidates were also asked how they would approach the job of attorney general with regard to investigating financial firms for fraud or other wrongdoing. James had courted controversy when she recently <a href="https://www.nytimes.com/2018/08/14/nyregion/sheriff-wall-street-letitia-james-attorney-general.html" target="_blank" rel="noopener">told The New York Times</a> that she did not want to be known as “the Sheriff on Wall Street,” a statement which propelled criticism from her opponents, who embraced the moniker and did so again Tuesday. At the debate, James reiterated her point, however, even after Eve said that she would want to be known as “the Sheriff of Wall Street.”</p> <p>“No I don’t want to be known as the Sheriff on Wall Street, that’s reserved for someone else,” James said, apparently referring to former Attorney General and Governor Eliot Spitzer. “I want to chart my own path. I want my own title, my own title has always been and will continue to be ‘fighter.’” She proposed strengthening the Martin Act, a 1921 state law that gives the attorney general broad power to investigate financial fraud that was revived by Spitzer. James said she would seek to expand, within her first 100 days in office, the act’s statute of limitations from three years to six years.</p> <p>“You know I want to be called the Sheriff of Wall Street,” Teachout said, claiming that the role of the attorney general as “regulator of last resort” was important with a federal government uninterested in regulating big banks and financial firms.</p> <p>“One of the things I really take from Spitzer’s use of the Martin Act is that was an example of an old tool that hadn’t been used,” Teachout said, “being dusted off and used in new and critical ways to hold Wall Street accountable. That’s the kind of creative lawyering, creative legal strategy, that I as the next sheriff will pursue.”</p> <p>Maloney, too, was quick to rebuke James. “Of course you’re gonna be the sheriff of Wall Street, that’s literally the job,” he said. But like James had explained of her perspective, he made sure to say that he would also be the “sheriff” of such issues as Trump, environmental protection, LGBT equality, and criminal justice reform.</p> <p>The representative from the upper Hudson Valley repeatedly noted that he has fought and beaten Republicans, referencing the fact that he has been elected several times in what is a swing district, and touted his government and management experience. James and Eve also highlighted their work in goverment and overseeing teams of employees, while Teachout focused on her expertise in corruption and law, and her work helping to craft litigation against President Trump for alleged violations of the emoluments clause of the Constitution.</p> <p>During a series of “lightning round” questions with quick answers, James and Maloney both stated for the first time that open, public state hearings should be held regarding sexual harassment in state government and beyond; Teachout and Eve had both said previously that hearings should be held.</p> <p>While James answered that she had released five years of tax returns, and was the only candidate to release returns, Teachout and Maloney each said that they would release five years of tax returns by the end of this week. Eve demurred, saying that she had years of government-mandated financial disclosures publicly available.</p> <p>And when asked which other candidate they would vote for if they couldn’t vote for themselves, Maloney and Teachout each said that they would vote for Eve, while Eve and James said only that they promise to vote for the winner of the Democratic primary. Eve, who has trailed significantly in public polling, may have been the safe choice for Maloney and Teachout, though when <a href="https://www.nytimes.com/2018/08/19/opinion/zephyr-teachout-new-york-attorney-general.html" target="_blank" rel="noopener">The New York Times editorial board endorsed Teachout</a> earlier this week, it also noted Eve as its second choice.</p> <p>When offered the opportunity to cross-examine one opponent, none of the candidates opted to ask a question of James, who has led in that public polling for the race despite a high undecided count; she has the support of most of the party “establishment,” including elected officials, clubs, and labor unions. Instead, two questions were leveled at Maloney, and two at Teachout.</p> <p>Teachout was asked by James about opposition to the NY SAFE Act, a signature Cuomo gun control law, during her 2016 Congressional run, to which Teachout said her opposition was only to the secretive process to its passage, part of a pattern of how business is done in the state Capitol that she has consistently denounced. Teachout was asked by Maloney about a citation she had received from the North Carolina Bar, where she is licensed to practice law, which she said was due to not sharing a change in address during a case.</p> <p>Maloney was asked by Eve about why he had chosen to run simultaneously for attorney general and for his congressional seat, a situation that led fellow member of Congress Kathleen Rice to not seek the nomination for attorney general. Maloney said that a judge had already decided in his favor.</p> <p>Maloney was asked by Teachout about $150,000 he received in donations from eight LLCs connected to the Durst Organization, one of the largest real estate developers in New York City. Maloney first attempted to say that Durst felt he was the most qualified candidate and to deflect to in-kind and super PAC contributions Teachout had received in 2016, but when pressed for a more full response by the moderator, he said that the Durst contributions were a “small part of” his overall fundraising. Maloney had earlier concurred with his opponents that the “LLC loophole,” wherein corporations can give virtually unlimited amounts of money to candidates by forming various limited liability companies, should be closed.</p> <p>Other targets for investigations, lawsuits, and prosecutions specifically named by the candidates included the fossil fuel industry, the pharmaceutical industry, the National Rifle Association, real estate developers, and “bad landlords.” The candidates also said that they would use the bully pulpit to advance civil rights causes, particularly in the realm of criminal justice reform: each candidate said that they believe cash bail should be abolished, and that Mayor Bill de Blasio’s 10-year timeline for closing Rikers Island jails is too long. All four said they will not run for governor, which would separate them from recent attorneys general-turned-governors Spitzer and Cuomo.</p> <p>The Democratic primary for attorney general, governor, lieutenant governor, and state legislative seats, among other races, will be held on Thursday, September 13; the winner of the Democratic primary for attorney general will face Republican Keith Wofford and other candidates in the general election. The Democratic attorney general candidates will meet again for a televised debate on NY1 on Tuesday August 28 at John Jay College. The Manhattan Neighborhood Network debat aired Wednesday and <a href="https://www.youtube.com/watch?v=05Lge7BKabM" target="_blank" rel="noopener">can be watched on YouTube</a>.</p> <p>

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by Ben Brachfeld, Gotham Gazette

Read more by this writer.

</p> <p>Ben Max contributed to this article.</p>
Alain Kaloyeros, Cuomo’s Buffalo Billion Star, Found Guilty on All Charges 2018-07-12T04:00:00+00:00 2018-07-12T04:00:00+00:00 http://www.gothamgazette.com/?id=7802:alain-kaloyeros-cuomo-s-buffalo-billion-star-found-guilty-on-all-charges Ben Max <p><img src="http://www.gothamgazette.com/images/24935236946_86d671359f_z_1.jpg" alt="Kaloyeros Cuomo Buffalo Billion" width="600" height="399" /></p> <p>Alain Kaloyeros (photo via The Governor's Office)</p> <hr /> <p>Alain Kaloyeros, the former president of SUNY Polytechnic Institute who spearheaded key pieces of Governor Andrew Cuomo’s vaunted Buffalo Billion economic revitalization program, was found guilty in federal court on Thursday of bid-rigging state contracts in favor of upstate firms whose executives were major donors to the governor’s campaign.</p> <p>Following a trial that lasted just under a month, a jury found Kaloyeros guilty on charges of wire fraud and conspiracy to commit wire fraud in connection with two separate schemes in which he colluded with a prominent lobbyist to manipulate state contract bids. Prosecutors charged Kaloyeros with rigging requests for proposals (RFPs) to favor prominent executives from two specific firms -- Louis Ciminelli from Buffalo-based LPCiminelli, and Joseph Gerardi and Steven Aiello from Syracuse-based COR Development. Ciminelli, Gerardi and Aiello also stood trial with Kaloyeros and were found guilty on Thursday as well. The defendants are all expected to be sentenced in October.</p> <p>Kaloyeros, who the governor praised in lofty terms when appointing him to lead the Buffalo Billion and over the course of subsequent years, conspired on the two schemes with the developers and Todd Howe, a now infamous lobbyist with close ties to Cuomo. Howe was the government’s star witness in another federal corruption case earlier this year involving former top Cuomo aide Joe Percoco, <a href="http://www.gothamgazette.com/state/7539-joseph-percoco-former-top-cuomo-aide-convicted-on-3-felony-counts" target="_blank" rel="noopener">who was also convicted</a>. COR executives Gerardi and Aiello were co-defendants in that trial as well.</p> <p>Prosecutors in the Kaloyeros trial relied on email records that showed the eccentric tech guru plotted to ensure that LPCiminelli received a contract to construct a solar panel factory, which eventually ballooned in cost to $750 million, and that COR development was awarded more than $100 million to build a manufacturing plant and film studio. The bid-rigging was done in apparent effort to please Cuomo, though the governor himself was not accused of committing any crimes.</p> <p>In a statement, Geoffrey Berman, the U.S. Attorney for the Southern District of New York, whose office prosecuted the case, expressed pride that the Kaloyeros verdict was just the latest successful conviction won by the office’s Public Corruption Unit, following the conviction of Percoco and former state Assembly Speaker Sheldon Silver. “The guiding principle of the Southern District holds that true justice can only be achieved through independence from politics or influence, and that has never been more important than today,” he said.</p> <p>All of the cases were originally brought by former U.S. Attorney Preet Bharara, who was fired by President Donald Trump and celebrated the verdicts on Twitter, <a href="https://twitter.com/PreetBharara/status/1017510729140842496" target="_blank" rel="noopener">writing</a>, “All four Buffalo Billion defendants guilty on all counts. Congratulations to the team at SDNY for continuing to strike big blows against corruption in New York State.”</p> <p>The two corruption cases involving Percoco, Howe, and Kaloyeros, among others, have been a black eye for Cuomo, though he was never accused of criminal wrongdoing in either one, and his political opponents have repeatedly used them to criticize both the governor and the pay-to-play culture in state government. In a harshly worded statement following the verdict, actor and activist Cynthia Nixon, the governor’s Democratic primary challenger, scoffed at the governor’s proclaimed ignorance of Kaloyeros and Percoco’s misdeeds. “Andrew Cuomo is either corrupt or he is spectacularly incompetent,” Nixon said. “Either way, the facts from the trials of Joe Percoco and Alain Kaloyeros lead to only one conclusion: We can’t clean up Albany until we clean out the governor’s mansion. Nothing is going to change until we change who’s in charge.”</p> <p>Cuomo, who has said that he has not followed the case closely, said in his own statement, “The jury has spoken and justice has been done. There can be no tolerance for those who seek to defraud the system to advance their own personal interests. Anyone who has committed such an egregious act should be punished to the full extent of the law." Cuomo did not mention anyone by name or promise any reforms. <a href="http://www.gothamgazette.com/state/7353-with-phase-one-going-on-trial-cuomo-s-buffalo-investment-moves-ahead-with-changes-and-broken-reform-promises" target="_blank" rel="noopener">He has not followed through on several governmental and campaign promises he made when the scandal broke.</a></p> <p>In response to the verdict, government watchdogs warned that the lax state regulations that allowed Kaloyeros’ criminal actions remain unchanged. A coalition of groups including Reinvent Albany, Citizens Budget Commission, NYPIRG, and Fiscal Policy Institute issued a statement repeating calls for “clean contracting” reforms, saying that “evidence introduced at the federal trial of Alain Kaloyeros, the governor's former nano-czar, and executives from LP Ciminelli and COR Development highlight the vulnerability of the state’s economic development programs to corruption and abuse.”</p> <p>“The convictions in the ‘Buffalo Billion’ trial underscore the huge corruption risks that continue to plague Albany,” read a statement from the New York Public Interest Research Group. “The Governor 's failure to produce meaningful reforms, coupled with the Legislature's inability to come to an agreement on its own, highlight the failures of the state's elected leadership to grapple with unending scandals.”</p> <p>

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by Samar Khurshid, City government reporter, Gotham Gazette
     

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</p>
<p><img src="http://www.gothamgazette.com/images/24935236946_86d671359f_z_1.jpg" alt="Kaloyeros Cuomo Buffalo Billion" width="600" height="399" /></p> <p>Alain Kaloyeros (photo via The Governor's Office)</p> <hr /> <p>Alain Kaloyeros, the former president of SUNY Polytechnic Institute who spearheaded key pieces of Governor Andrew Cuomo’s vaunted Buffalo Billion economic revitalization program, was found guilty in federal court on Thursday of bid-rigging state contracts in favor of upstate firms whose executives were major donors to the governor’s campaign.</p> <p>Following a trial that lasted just under a month, a jury found Kaloyeros guilty on charges of wire fraud and conspiracy to commit wire fraud in connection with two separate schemes in which he colluded with a prominent lobbyist to manipulate state contract bids. Prosecutors charged Kaloyeros with rigging requests for proposals (RFPs) to favor prominent executives from two specific firms -- Louis Ciminelli from Buffalo-based LPCiminelli, and Joseph Gerardi and Steven Aiello from Syracuse-based COR Development. Ciminelli, Gerardi and Aiello also stood trial with Kaloyeros and were found guilty on Thursday as well. The defendants are all expected to be sentenced in October.</p> <p>Kaloyeros, who the governor praised in lofty terms when appointing him to lead the Buffalo Billion and over the course of subsequent years, conspired on the two schemes with the developers and Todd Howe, a now infamous lobbyist with close ties to Cuomo. Howe was the government’s star witness in another federal corruption case earlier this year involving former top Cuomo aide Joe Percoco, <a href="http://www.gothamgazette.com/state/7539-joseph-percoco-former-top-cuomo-aide-convicted-on-3-felony-counts" target="_blank" rel="noopener">who was also convicted</a>. COR executives Gerardi and Aiello were co-defendants in that trial as well.</p> <p>Prosecutors in the Kaloyeros trial relied on email records that showed the eccentric tech guru plotted to ensure that LPCiminelli received a contract to construct a solar panel factory, which eventually ballooned in cost to $750 million, and that COR development was awarded more than $100 million to build a manufacturing plant and film studio. The bid-rigging was done in apparent effort to please Cuomo, though the governor himself was not accused of committing any crimes.</p> <p>In a statement, Geoffrey Berman, the U.S. Attorney for the Southern District of New York, whose office prosecuted the case, expressed pride that the Kaloyeros verdict was just the latest successful conviction won by the office’s Public Corruption Unit, following the conviction of Percoco and former state Assembly Speaker Sheldon Silver. “The guiding principle of the Southern District holds that true justice can only be achieved through independence from politics or influence, and that has never been more important than today,” he said.</p> <p>All of the cases were originally brought by former U.S. Attorney Preet Bharara, who was fired by President Donald Trump and celebrated the verdicts on Twitter, <a href="https://twitter.com/PreetBharara/status/1017510729140842496" target="_blank" rel="noopener">writing</a>, “All four Buffalo Billion defendants guilty on all counts. Congratulations to the team at SDNY for continuing to strike big blows against corruption in New York State.”</p> <p>The two corruption cases involving Percoco, Howe, and Kaloyeros, among others, have been a black eye for Cuomo, though he was never accused of criminal wrongdoing in either one, and his political opponents have repeatedly used them to criticize both the governor and the pay-to-play culture in state government. In a harshly worded statement following the verdict, actor and activist Cynthia Nixon, the governor’s Democratic primary challenger, scoffed at the governor’s proclaimed ignorance of Kaloyeros and Percoco’s misdeeds. “Andrew Cuomo is either corrupt or he is spectacularly incompetent,” Nixon said. “Either way, the facts from the trials of Joe Percoco and Alain Kaloyeros lead to only one conclusion: We can’t clean up Albany until we clean out the governor’s mansion. Nothing is going to change until we change who’s in charge.”</p> <p>Cuomo, who has said that he has not followed the case closely, said in his own statement, “The jury has spoken and justice has been done. There can be no tolerance for those who seek to defraud the system to advance their own personal interests. Anyone who has committed such an egregious act should be punished to the full extent of the law." Cuomo did not mention anyone by name or promise any reforms. <a href="http://www.gothamgazette.com/state/7353-with-phase-one-going-on-trial-cuomo-s-buffalo-investment-moves-ahead-with-changes-and-broken-reform-promises" target="_blank" rel="noopener">He has not followed through on several governmental and campaign promises he made when the scandal broke.</a></p> <p>In response to the verdict, government watchdogs warned that the lax state regulations that allowed Kaloyeros’ criminal actions remain unchanged. A coalition of groups including Reinvent Albany, Citizens Budget Commission, NYPIRG, and Fiscal Policy Institute issued a statement repeating calls for “clean contracting” reforms, saying that “evidence introduced at the federal trial of Alain Kaloyeros, the governor's former nano-czar, and executives from LP Ciminelli and COR Development highlight the vulnerability of the state’s economic development programs to corruption and abuse.”</p> <p>“The convictions in the ‘Buffalo Billion’ trial underscore the huge corruption risks that continue to plague Albany,” read a statement from the New York Public Interest Research Group. “The Governor 's failure to produce meaningful reforms, coupled with the Legislature's inability to come to an agreement on its own, highlight the failures of the state's elected leadership to grapple with unending scandals.”</p> <p>

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by Samar Khurshid, City government reporter, Gotham Gazette
     

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Post-Percoco Conviction, Kaloyeros Trial Likely to Further Stain Cuomo Administration 2018-03-21T04:00:00+00:00 2018-03-21T04:00:00+00:00 http://www.gothamgazette.com/?id=7558:post-percoco-conviction-kaloyeros-trial-likely-to-further-stain-cuomo-administration Ben Max <p><img src="http://www.gothamgazette.com/images/25944005563_4e277f7372_z_2.jpg" alt="Alain Kaloyeros" width="600" height="400" /></p> <p>Alain Kaloyeros (photo: The Governor's Office)</p> <hr /> <p>Following the recent conviction of Governor Andrew Cuomo’s longtime aide Joseph Percoco on corruption charges – a humiliating blow for a governor who once campaigned on a promise to reform Albany – Cuomo quickly sought to shift attention from the executive to the legislative branch.</p> <p>A day after Percoco was convicted of fraud and soliciting bribes, Cuomo called for ethics reform – in the Assembly and Senate.</p> <p>“The single best ethics reform, which makes everything else moot, is no outside income in government,” he <a href="http://www.ny1.com/nyc/all-boroughs/politics/2018/03/15/andrew-cuomo-speaks-publicly-for-first-time-about-joe-percoco-guilty-verdict" target="_blank" rel="noopener">said</a>, pointing to the State Legislature. Jobs there are considered part-time and outside income is allowed, though the Percoco trial had nothing to do with legislators’ outside income.</p> <p>Cuomo called Percoco’s behavior an “aberration” for those in his administration, and said he himself was not mentioned at the trial; in fact, Cuomo’s name or title was invoked hundreds of times. The governor has sought to quickly put the Percoco news behind him, though there are a number of unanswered questions about what Cuomo either allowed to occur under his watch, didn’t know about, or empowered Percoco to do.</p> <p>Just on the horizon, too, is the trial of Alain Kaloyeros, scheduled to start June 18, proceedings sure to raise further questions about the governor’s leadership and deepen the stain on the Cuomo administration. Valerie Caproni, the same judge who presided over the Percoco trial, will oversee the Kaloyeros case.</p> <p>Kaloyeros, the eccentric scientist whom Cuomo empowered to lead key parts of his Buffalo Billion revitalization initiative, is accused of bid-rigging to help developers who donated to the Cuomo campaign. Expect the trial -- which also includes alleged Kaloyeros co-conspirators -- to reveal even more damning details about how members of Cuomo’s inner circle doled out hundreds of millions of dollars through Buffalo Billion.</p> <p>Cuomo announced the initiative in 2012 in hopes of revitalizing the western New York city’s struggling economy.</p> <p>“The billion dollars was important for shock and awe value,” <a href="https://www.nytimes.com/2015/07/21/business/energy-environment/the-wind-and-sun-are-bringing-the-shine-back-to-buffalo.html" target="_blank" rel="noopener">the governor said</a> as Buffalo Billion projects got underway. “They were so down, and they had heard everything for so long, and they were so distrustful that I needed to say something that would actually get their attention and allow them to think, ‘Maybe it’s different this time.’”</p> <p>Though the biggest Buffalo Billion project, a solar panel factory called SolarCity, is at the center of the Kaloyeros trial, Cuomo recently launched a sequel called <a href="http://www.gothamgazette.com/state/7353-with-phase-one-going-on-trial-cuomo-s-buffalo-investment-moves-ahead-with-changes-and-broken-reform-promises" target="_blank">Buffalo Billion II</a> that will focus on small- and medium-sized manufacturers.</p> <p>The Kaloyeros trial could shed more light on an alleged pay-to-play culture in which developers were rewarded after donating to the governor, a key aspect of the Percoco trial.</p> <p>Further, for all the attention Kaloyeros received during his years as a flamboyant tech-industry pioneer, there’s the question of why he allegedly helped rig bids to ensure major campaign contributors won state contracts – without being accused of taking bribes himself. The trial might provide answers about that, too.</p> <p>The federal corruption investigation prompted Kaloyeros to resign as president of SUNY Polytechnic Institute in October. Prior to the scandal, he had gained notice for bringing expensive tech projects to the state starting during the Pataki administration. Kaloyeros’ ostentatious public profile, replete with luxury sports cars and <a href="http://gothamist.com/2015/10/08/highly_paid_state_worker.php" target="_blank" rel="noopener">awkward social media posts</a>, drew bemused coverage from newspapers; The New York Times <a href="http://www.nytimes.com/2002/07/26/nyregion/public-lives-behind-a-research-center-a-geek-with-great-cars.html" target="_blank" rel="noopener">dubbed him</a> “a dapper dervish of a scientist” in 2002. His knack for persuading huge companies to invest in the state led Cuomo to <a href="https://www.wsj.com/articles/suny-polytechnic-president-alain-kaloyeros-resigns-1476208617" target="_blank" rel="noopener">call him</a> “the closest thing to a genius I’ve ever worked with.”</p> <p>For his part, Kaloyeros was never modest about his work.</p> <p>“The job requires being a scientist, being a psychiatrist, being a priest, being a cop, being a negotiator, being a business developer or manager, being a teacher, being an adviser and being an ego-kisser,” he <a href="https://www.nytimes.com/2016/09/23/nyregion/physicist-in-albany-corruption-case-was-a-geek-with-big-goals.html" target="_blank" rel="noopener">said in 2011</a>. “I’d like to think I do all of them very well.”</p> <p>John Kaehny, executive director of Reinvent Albany, said Kaloyeros “stands out as a much more independent figure than Percoco.”</p> <p>“He had his own aspirations as an empire-builder and his own vision of these gigantic multibillion-dollar chip factories that were going to spur a manufacturing renaissance,” Kaehny explained.</p> <p>Kaloyeros allegedly collaborated with Albany insider Todd Howe, who made a plea deal in the Kaloyeros and Percoco cases, to rig bidding for hundreds of millions of dollars’ worth of state contracts.</p> <p>The <a href="https://www.justice.gov/usao-sdny/file/895131/download" target="_blank" rel="noopener">indictment</a> from the U.S Attorney for the Southern District of New York describes a scheme in which two companies – COR Development and LP Ciminelli – paid thousands of dollars in bribes to Howe. In exchange, he and Kaloyeros allegedly ensured that the developers won a range of lucrative contracts – a $15 million film studio and a $90 million manufacturing plant for COR Development; and a $225 million solar panel plant for LPCiminelli, with the cost eventually rising to $750 million, according to the indictment. All of it came from taxpayer dollars allocated toward Cuomo’s signature economic development programs.</p> <p>Last week, COR Development’s President Steven Aiello <a href="http://www.gothamgazette.com/state/7539-joseph-percoco-former-top-cuomo-aide-convicted-on-3-felony-counts" target="_blank">was found guilty</a> of his role in the Percoco case, while the company’s general counsel Joseph Gerardi was found not guilty. LP Ciminelli executives did not face charges in that trial. The dollar figures in the Kaloyeros trial are much larger than those in the Percoco matter. The program at play, Buffalo Billion, is inextricable from Cuomo’s record as governor, unlike anything involved in the Percoco trial – except Peroco himself and the state’s porous campaign finance system.</p> <p>The indictment notes that Kaloyeros hired Howe as a consultant at the College of Nanoscale Science and Engineering (CNSE), which later became SUNY Polytechnic, as the college was crafting requests for proposals for the development projects in 2013. COR Development and LP Ciminelli allegedly made its bribes to Howe, disguised as consultancy payments and bonuses, around the same time.</p> <p>The nature of the relationship between the scientist and the former lobbyist, a <a href="http://www.syracuse.com/state/index.ssf/2018/02/todd_howe_lobbyist_with_millions_in_state_projects_helped_shape_cuomo_dream_team.html" target="_blank" rel="noopener">longtime Cuomo ally and operator</a> in the upper echelons of state government in spite of a 2010 bank fraud conviction, &nbsp;could come into sharper focus during the upcoming trial.</p> <p>“The question is why exactly did Kaloyeros hire Howe, what was Howe’s role and what was Howe telling Kaloyeros to do?” said Kaehny, whose organization closely monitors state government spending. “That’s what we’ll be looking for.”</p> <p>It is also not entirely clear what Kaloyeros, who was not charged with receiving bribes himself, hoped to get out of the alleged scheme. Mention of Kaloyeros’ possible motives is limited to a single sentence in the 79-page indictment:</p> <p>“For his part in the scheme, Kaloyeros was able to maintain his leadership position and substantial salary at CNSE and garner support from the Office of the Governor for projects important to him, including the creation of SUNY Poly.”</p> <p>Blair Horner, executive director of NYPIRG, another good government group, speculated that Kaloyeros’ role in the alleged scheme could come down to love of his work.</p> <p>“He was the highest paid staff person in the state, probably in the history of the state,” Horner said, referring to Kaloyeros’ combined annual salary of more than $800,000. “It wouldn’t surprise me if it turned out he loved what he was doing and did not want to lose it,” he added, emphasizing that the charges remain to be proven.</p> <p>Thus far into the corruption scandal, both prosecutors and journalists have mostly focused on the alleged bribery, the players involved, and their ties to Cuomo.</p> <p>But the investigation also raises questions about apparent favoritism for developers who gave big to Cuomo’s campaign accounts.</p> <p>The indictment notes that Howe and Kaloyeros allegedly began crafting bids to favor COR Development and LP Ciminelli in 2013, after the governor had launched his <a href="http://www.gothamgazette.com/state/7353-with-phase-one-going-on-trial-cuomo-s-buffalo-investment-moves-ahead-with-changes-and-broken-reform-promises" target="_blank">Buffalo Billion initiative</a> and executives from the companies “had each made sizable contributions to the Governor.”</p> <p>The indictment does not detail the contributions, and none of the federal charges against Kaloyeros or the other defendants appear to directly stem from campaign finance law.</p> <p>However, the investigations prompted Cuomo’s reelection campaign to “set aside” a total of roughly $350,000 in contributions from COR Development and LP Ciminelli. Last fall, a Democratic official <a href="https://www.lohud.com/story/news/politics/politics-on-the-hudson/2016/09/27/dinapoli-returning-campaign-cash-developers/91181440/" target="_blank" rel="noopener">told lohud.com</a> the move would enable authorities to recover the funds, pending the outcome of the trials.</p> <p>Discussing COR Development and LP Ciminelli’s campaign contributions, Kaehny said, “It’s fairly shocking that a business or a group could donate essentially unlimited amounts of money to the governor and legislature while they’re trying to get state contracts or state grants.”</p> <p>“The [Percoco] trial spotlights state laws that are so weak that what’s unethical is legal,” he added. New York State has no “doing business” restrictions on campaign donations. In New York City, entities on the “doing business” list are limited to about $400 in donations to an individual candidate.</p> <p>Government watchdogs, and a few elected officials, hope the trials will give renewed momentum to long-stalled proposals for <a href="https://www.nypirg.org/pubs/201803/percoco.pdf">a range of reforms</a>.</p> <p>“I think the most important questions are ones not only about how the state can prevent future wrongdoing, but also what investments make sense for the state going forward, which may or may not come out” of the trials, said David Friedfel, director of state studies for the Citizens Budget Commission. Corruption or not, there have been ongoing questions about the Cuomo approach to economic development spending.</p> <p>Reinvent Albany, NYPIRG, and other watchdogs have long called for tighter controls on campaign contributions, including closing the <a href="http://www.gothamgazette.com/?id=5684:left-out-of-ethics-deal-llc-loophole-faces-renewed-scrutiny" target="_blank">so-called LLC loophole</a>, which featured prominently during the Percoco trial. It emerged that developers were encouraged to donate heavily to Cuomo, through several limited liability corporations that would help mask the contributors.</p> <p>Good government groups also emphasize the need for greater transparency for state spending, through measures like restoring the state comptroller’s <a href="http://www.gothamgazette.com/state/7007-with-session-ending-and-trial-looming-no-legislative-response-to-bid-rigging-scandal" target="_blank">power to pre-approve contracts</a>. Cuomo and legislative leaders took away that power in 2011.</p> <p>Additionally, watchdogs hope the trials will boost support of a proposed <a href="http://www.gothamgazette.com/opinion/7542-sunlight-for-subsidies" target="_blank">“Database of Deals”</a> that would list all state projects awarded to companies and detail the return on investment to taxpayers.</p> <p>Robin Schimminger introduced the Assembly bill to create the database. Asked about Percoco’s recent conviction and the upcoming Kaloyeros trial, the Buffalo-area Democrat took a wide view.</p> <p>“The most important thing is that when people serve in government, they have a moral compass,” he said. “If people don’t have that compass, they’re going to go astray.</p> <p>“However, there are things the state could and should be doing to deter and make it more difficult for those actions to occur. Those are actions that enhance transparency and accountability.”</p> <p>While Cuomo has a long list of ethics reforms again in his platform this year, including closure of the LLC loophole, he has not been outspoken in pushing for them.</p> <p>The governor’s campaign finances will again be on the stand, so to speak, during the Kaloyeros trial, which will begin as election season is heating up, with spring party nominating conventions.</p> <p>Cynthia Nixon’s dramatic entrance into the gubernatorial race, challenging Cuomo in this year’s Democratic primary, included a focus on corruption. She named Percoco from the podium at her launch event in Brooklyn on Tuesday, leveling a variety of blistering criticism at the governor.</p> <p>Nixon is likely to have ample opportunity to connect Cuomo to the trial, as will other gubernatorial candidates, like expected Republican nominee Marc Molinaro, currently Dutchess County Executive.</p> <p>Whatever the long-term consequences of the Kaloyeros trial, observers expect it to go more smoothly than the Percoco case, in which jurors were deadlocked twice before reaching guilty verdicts on some of the counts.</p> <p>Discussing the Kaloyeros case, Kaehny said, “It’s simpler, more straightforward, and the email evidence is quite strong in favor of the prosecution.”</p> <p>

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by Shant Shahrigianh, Gotham Gazette
      

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</p> <p>Ben Max contributed to this article.</p> <p>Note: this article has been updated to reflet the Kaloyeros trial being moved back one week, to a June 18 start.</p>
<p><img src="http://www.gothamgazette.com/images/25944005563_4e277f7372_z_2.jpg" alt="Alain Kaloyeros" width="600" height="400" /></p> <p>Alain Kaloyeros (photo: The Governor's Office)</p> <hr /> <p>Following the recent conviction of Governor Andrew Cuomo’s longtime aide Joseph Percoco on corruption charges – a humiliating blow for a governor who once campaigned on a promise to reform Albany – Cuomo quickly sought to shift attention from the executive to the legislative branch.</p> <p>A day after Percoco was convicted of fraud and soliciting bribes, Cuomo called for ethics reform – in the Assembly and Senate.</p> <p>“The single best ethics reform, which makes everything else moot, is no outside income in government,” he <a href="http://www.ny1.com/nyc/all-boroughs/politics/2018/03/15/andrew-cuomo-speaks-publicly-for-first-time-about-joe-percoco-guilty-verdict" target="_blank" rel="noopener">said</a>, pointing to the State Legislature. Jobs there are considered part-time and outside income is allowed, though the Percoco trial had nothing to do with legislators’ outside income.</p> <p>Cuomo called Percoco’s behavior an “aberration” for those in his administration, and said he himself was not mentioned at the trial; in fact, Cuomo’s name or title was invoked hundreds of times. The governor has sought to quickly put the Percoco news behind him, though there are a number of unanswered questions about what Cuomo either allowed to occur under his watch, didn’t know about, or empowered Percoco to do.</p> <p>Just on the horizon, too, is the trial of Alain Kaloyeros, scheduled to start June 18, proceedings sure to raise further questions about the governor’s leadership and deepen the stain on the Cuomo administration. Valerie Caproni, the same judge who presided over the Percoco trial, will oversee the Kaloyeros case.</p> <p>Kaloyeros, the eccentric scientist whom Cuomo empowered to lead key parts of his Buffalo Billion revitalization initiative, is accused of bid-rigging to help developers who donated to the Cuomo campaign. Expect the trial -- which also includes alleged Kaloyeros co-conspirators -- to reveal even more damning details about how members of Cuomo’s inner circle doled out hundreds of millions of dollars through Buffalo Billion.</p> <p>Cuomo announced the initiative in 2012 in hopes of revitalizing the western New York city’s struggling economy.</p> <p>“The billion dollars was important for shock and awe value,” <a href="https://www.nytimes.com/2015/07/21/business/energy-environment/the-wind-and-sun-are-bringing-the-shine-back-to-buffalo.html" target="_blank" rel="noopener">the governor said</a> as Buffalo Billion projects got underway. “They were so down, and they had heard everything for so long, and they were so distrustful that I needed to say something that would actually get their attention and allow them to think, ‘Maybe it’s different this time.’”</p> <p>Though the biggest Buffalo Billion project, a solar panel factory called SolarCity, is at the center of the Kaloyeros trial, Cuomo recently launched a sequel called <a href="http://www.gothamgazette.com/state/7353-with-phase-one-going-on-trial-cuomo-s-buffalo-investment-moves-ahead-with-changes-and-broken-reform-promises" target="_blank">Buffalo Billion II</a> that will focus on small- and medium-sized manufacturers.</p> <p>The Kaloyeros trial could shed more light on an alleged pay-to-play culture in which developers were rewarded after donating to the governor, a key aspect of the Percoco trial.</p> <p>Further, for all the attention Kaloyeros received during his years as a flamboyant tech-industry pioneer, there’s the question of why he allegedly helped rig bids to ensure major campaign contributors won state contracts – without being accused of taking bribes himself. The trial might provide answers about that, too.</p> <p>The federal corruption investigation prompted Kaloyeros to resign as president of SUNY Polytechnic Institute in October. Prior to the scandal, he had gained notice for bringing expensive tech projects to the state starting during the Pataki administration. Kaloyeros’ ostentatious public profile, replete with luxury sports cars and <a href="http://gothamist.com/2015/10/08/highly_paid_state_worker.php" target="_blank" rel="noopener">awkward social media posts</a>, drew bemused coverage from newspapers; The New York Times <a href="http://www.nytimes.com/2002/07/26/nyregion/public-lives-behind-a-research-center-a-geek-with-great-cars.html" target="_blank" rel="noopener">dubbed him</a> “a dapper dervish of a scientist” in 2002. His knack for persuading huge companies to invest in the state led Cuomo to <a href="https://www.wsj.com/articles/suny-polytechnic-president-alain-kaloyeros-resigns-1476208617" target="_blank" rel="noopener">call him</a> “the closest thing to a genius I’ve ever worked with.”</p> <p>For his part, Kaloyeros was never modest about his work.</p> <p>“The job requires being a scientist, being a psychiatrist, being a priest, being a cop, being a negotiator, being a business developer or manager, being a teacher, being an adviser and being an ego-kisser,” he <a href="https://www.nytimes.com/2016/09/23/nyregion/physicist-in-albany-corruption-case-was-a-geek-with-big-goals.html" target="_blank" rel="noopener">said in 2011</a>. “I’d like to think I do all of them very well.”</p> <p>John Kaehny, executive director of Reinvent Albany, said Kaloyeros “stands out as a much more independent figure than Percoco.”</p> <p>“He had his own aspirations as an empire-builder and his own vision of these gigantic multibillion-dollar chip factories that were going to spur a manufacturing renaissance,” Kaehny explained.</p> <p>Kaloyeros allegedly collaborated with Albany insider Todd Howe, who made a plea deal in the Kaloyeros and Percoco cases, to rig bidding for hundreds of millions of dollars’ worth of state contracts.</p> <p>The <a href="https://www.justice.gov/usao-sdny/file/895131/download" target="_blank" rel="noopener">indictment</a> from the U.S Attorney for the Southern District of New York describes a scheme in which two companies – COR Development and LP Ciminelli – paid thousands of dollars in bribes to Howe. In exchange, he and Kaloyeros allegedly ensured that the developers won a range of lucrative contracts – a $15 million film studio and a $90 million manufacturing plant for COR Development; and a $225 million solar panel plant for LPCiminelli, with the cost eventually rising to $750 million, according to the indictment. All of it came from taxpayer dollars allocated toward Cuomo’s signature economic development programs.</p> <p>Last week, COR Development’s President Steven Aiello <a href="http://www.gothamgazette.com/state/7539-joseph-percoco-former-top-cuomo-aide-convicted-on-3-felony-counts" target="_blank">was found guilty</a> of his role in the Percoco case, while the company’s general counsel Joseph Gerardi was found not guilty. LP Ciminelli executives did not face charges in that trial. The dollar figures in the Kaloyeros trial are much larger than those in the Percoco matter. The program at play, Buffalo Billion, is inextricable from Cuomo’s record as governor, unlike anything involved in the Percoco trial – except Peroco himself and the state’s porous campaign finance system.</p> <p>The indictment notes that Kaloyeros hired Howe as a consultant at the College of Nanoscale Science and Engineering (CNSE), which later became SUNY Polytechnic, as the college was crafting requests for proposals for the development projects in 2013. COR Development and LP Ciminelli allegedly made its bribes to Howe, disguised as consultancy payments and bonuses, around the same time.</p> <p>The nature of the relationship between the scientist and the former lobbyist, a <a href="http://www.syracuse.com/state/index.ssf/2018/02/todd_howe_lobbyist_with_millions_in_state_projects_helped_shape_cuomo_dream_team.html" target="_blank" rel="noopener">longtime Cuomo ally and operator</a> in the upper echelons of state government in spite of a 2010 bank fraud conviction, &nbsp;could come into sharper focus during the upcoming trial.</p> <p>“The question is why exactly did Kaloyeros hire Howe, what was Howe’s role and what was Howe telling Kaloyeros to do?” said Kaehny, whose organization closely monitors state government spending. “That’s what we’ll be looking for.”</p> <p>It is also not entirely clear what Kaloyeros, who was not charged with receiving bribes himself, hoped to get out of the alleged scheme. Mention of Kaloyeros’ possible motives is limited to a single sentence in the 79-page indictment:</p> <p>“For his part in the scheme, Kaloyeros was able to maintain his leadership position and substantial salary at CNSE and garner support from the Office of the Governor for projects important to him, including the creation of SUNY Poly.”</p> <p>Blair Horner, executive director of NYPIRG, another good government group, speculated that Kaloyeros’ role in the alleged scheme could come down to love of his work.</p> <p>“He was the highest paid staff person in the state, probably in the history of the state,” Horner said, referring to Kaloyeros’ combined annual salary of more than $800,000. “It wouldn’t surprise me if it turned out he loved what he was doing and did not want to lose it,” he added, emphasizing that the charges remain to be proven.</p> <p>Thus far into the corruption scandal, both prosecutors and journalists have mostly focused on the alleged bribery, the players involved, and their ties to Cuomo.</p> <p>But the investigation also raises questions about apparent favoritism for developers who gave big to Cuomo’s campaign accounts.</p> <p>The indictment notes that Howe and Kaloyeros allegedly began crafting bids to favor COR Development and LP Ciminelli in 2013, after the governor had launched his <a href="http://www.gothamgazette.com/state/7353-with-phase-one-going-on-trial-cuomo-s-buffalo-investment-moves-ahead-with-changes-and-broken-reform-promises" target="_blank">Buffalo Billion initiative</a> and executives from the companies “had each made sizable contributions to the Governor.”</p> <p>The indictment does not detail the contributions, and none of the federal charges against Kaloyeros or the other defendants appear to directly stem from campaign finance law.</p> <p>However, the investigations prompted Cuomo’s reelection campaign to “set aside” a total of roughly $350,000 in contributions from COR Development and LP Ciminelli. Last fall, a Democratic official <a href="https://www.lohud.com/story/news/politics/politics-on-the-hudson/2016/09/27/dinapoli-returning-campaign-cash-developers/91181440/" target="_blank" rel="noopener">told lohud.com</a> the move would enable authorities to recover the funds, pending the outcome of the trials.</p> <p>Discussing COR Development and LP Ciminelli’s campaign contributions, Kaehny said, “It’s fairly shocking that a business or a group could donate essentially unlimited amounts of money to the governor and legislature while they’re trying to get state contracts or state grants.”</p> <p>“The [Percoco] trial spotlights state laws that are so weak that what’s unethical is legal,” he added. New York State has no “doing business” restrictions on campaign donations. In New York City, entities on the “doing business” list are limited to about $400 in donations to an individual candidate.</p> <p>Government watchdogs, and a few elected officials, hope the trials will give renewed momentum to long-stalled proposals for <a href="https://www.nypirg.org/pubs/201803/percoco.pdf">a range of reforms</a>.</p> <p>“I think the most important questions are ones not only about how the state can prevent future wrongdoing, but also what investments make sense for the state going forward, which may or may not come out” of the trials, said David Friedfel, director of state studies for the Citizens Budget Commission. Corruption or not, there have been ongoing questions about the Cuomo approach to economic development spending.</p> <p>Reinvent Albany, NYPIRG, and other watchdogs have long called for tighter controls on campaign contributions, including closing the <a href="http://www.gothamgazette.com/?id=5684:left-out-of-ethics-deal-llc-loophole-faces-renewed-scrutiny" target="_blank">so-called LLC loophole</a>, which featured prominently during the Percoco trial. It emerged that developers were encouraged to donate heavily to Cuomo, through several limited liability corporations that would help mask the contributors.</p> <p>Good government groups also emphasize the need for greater transparency for state spending, through measures like restoring the state comptroller’s <a href="http://www.gothamgazette.com/state/7007-with-session-ending-and-trial-looming-no-legislative-response-to-bid-rigging-scandal" target="_blank">power to pre-approve contracts</a>. Cuomo and legislative leaders took away that power in 2011.</p> <p>Additionally, watchdogs hope the trials will boost support of a proposed <a href="http://www.gothamgazette.com/opinion/7542-sunlight-for-subsidies" target="_blank">“Database of Deals”</a> that would list all state projects awarded to companies and detail the return on investment to taxpayers.</p> <p>Robin Schimminger introduced the Assembly bill to create the database. Asked about Percoco’s recent conviction and the upcoming Kaloyeros trial, the Buffalo-area Democrat took a wide view.</p> <p>“The most important thing is that when people serve in government, they have a moral compass,” he said. “If people don’t have that compass, they’re going to go astray.</p> <p>“However, there are things the state could and should be doing to deter and make it more difficult for those actions to occur. Those are actions that enhance transparency and accountability.”</p> <p>While Cuomo has a long list of ethics reforms again in his platform this year, including closure of the LLC loophole, he has not been outspoken in pushing for them.</p> <p>The governor’s campaign finances will again be on the stand, so to speak, during the Kaloyeros trial, which will begin as election season is heating up, with spring party nominating conventions.</p> <p>Cynthia Nixon’s dramatic entrance into the gubernatorial race, challenging Cuomo in this year’s Democratic primary, included a focus on corruption. She named Percoco from the podium at her launch event in Brooklyn on Tuesday, leveling a variety of blistering criticism at the governor.</p> <p>Nixon is likely to have ample opportunity to connect Cuomo to the trial, as will other gubernatorial candidates, like expected Republican nominee Marc Molinaro, currently Dutchess County Executive.</p> <p>Whatever the long-term consequences of the Kaloyeros trial, observers expect it to go more smoothly than the Percoco case, in which jurors were deadlocked twice before reaching guilty verdicts on some of the counts.</p> <p>Discussing the Kaloyeros case, Kaehny said, “It’s simpler, more straightforward, and the email evidence is quite strong in favor of the prosecution.”</p> <p>

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by Shant Shahrigianh, Gotham Gazette
      

Read more by this writer.

</p> <p>Ben Max contributed to this article.</p> <p>Note: this article has been updated to reflet the Kaloyeros trial being moved back one week, to a June 18 start.</p>
Joseph Percoco, Former Top Cuomo Aide, Convicted of Fraud, Soliciting Bribes 2018-03-13T04:00:00+00:00 2018-03-13T04:00:00+00:00 http://www.gothamgazette.com/?id=7539:joseph-percoco-former-top-cuomo-aide-convicted-on-3-felony-counts Ben Max <p><img src="http://www.gothamgazette.com/images/graphics/2018/percoco-lawyer-steps-of-courthouse.jpg" alt="percoco lawyer steps of courthouse" width="600" height="436" /></p> <p>Joe Percoco behind his lawyer (photo: Samar Khurshid/Gotham Gazette)</p> <hr /> <p>The jury in the federal corruption trial of Joseph Percoco, a former top aide to Governor Andrew Cuomo, returned with a verdict on Tuesday, finding Percoco guilty of two counts of conspiracy to commit honest services wire fraud and one count of soliciting bribes, charges related to a pair of bribery and bid-rigging schemes involving firms seeking to do business with the state. Percoco was also found not guilty on three charges he was facing.</p> <p>Over the course of more than seven weeks, the Percoco trial laid bare the inner workings of the state government and the lax regulations around government ethics and election financing. Prosecutors also touched on the functioning of the executive chamber, though no allegations of illegal wrongdoing were brought against Governor Andrew Cuomo, who once referred to his longtime friend Percoco as his father’s “third son.”</p> <p>After closing arguments last week, the jury deliberated for eight days -- and deadlocked twice -- before coming to a mixed verdict. In total, there were ten felony counts against Percoco and three co-defendants, upstate business executives who allegedly paid Percoco more than $300,000 for his help in getting favorable treatment from the state government. Former lobbyist Todd Howe, the government’s star witness in the case, pleaded guilty to facilitating the bribes to Percoco along with seven other felony counts related to the schemes.</p> <p>One of the bribery schemes involved the real estate developer COR Development and its executives, Joseph Gerardi and Steven Aiello, who were accused of bribing Percoco for assistance with labor unions on a real estate project as well as to obtain a raise for Aiello’s son. Both men faced charges of conspiracy to commit honest services wire fraud, paying bribes to Peroco and making false statements to federal investigators. Although Gerardi was found not guilty of all three charges, Aiello was found guilty on the conspiracy charge.</p> <p>The jury also deadlocked on two charges against Peter Galbraith Kelly, an executive from Competitive Power Ventures, an energy firm that was at the center of the second bribery scheme. Prosecutors alleged that Kelly organized a “low-show” job paying $90,000 a year for Percoco’s wife, which they said were actually bribes for Percoco. The jury’s decision led federal district judge Valerie Caproni to declare a mistrial for Kelly.</p> <p>Percoco himself was found not guilty on the three charges, including extortion under the color of official right, conspiracy to commit extortion under the color of official right, and soliciting bribes related to the COR scheme. He could face 50 years in prison on the three charges on which he was found guilty. Percoco’s sentencing is set for June 11; he and his lawyer said outside the courthouse that they would explore their legal options, including “what we might do in terms of making motions and pursuing our appellate rights.”</p> <p>At trial, prosecutors painted a picture of Percoco as the governor’s right-hand man, who could move mountains with a single phone call and who often bullied others in state government to do his bidding. The defense, however, sought to portray him as simply an “advance man” who managed events, scheduling, and day-to-day minutiae for the governor. The case was further complicated by the testimony of Howe, who was arrested midway through the trial after admitting to violating his cooperation agreement with the government. Although prosecutors, in their closing arguments, sought to downplay Howe’s role in the case, defense attorneys leaned heavily into the idea that Howe was a manipulative operator who was framing their clients for his own misdeeds.</p> <p>“Joseph Percoco was found guilty of taking over $300,000 in cash bribes by selling something priceless that was not his to sell – the sacred obligation to honestly and faithfully serve the citizens of New York,” said Manhattan U.S. Attorney Geoffrey Berman, in a statement after the verdict was announced. Berman said Percoco “corruptly chose to disregard” the fact that “government officials who sell their influence to select insiders violate the basic tenets of a democracy.”</p> <p>Speaking with reporters outside the courthouse, Percoco said he was “disappointed” with the verdict, but betrayed little emotion as he said he would consider the options with his lawyers. “I am thankful to my wonderful legal team and I‘m thankful to my family and friends that have stood by me throughout this entire process and I look forward to them all standing by me as we go forward,” he said.</p> <p>Barry Bohrer, Percoco’s defense attorney, questioned the jury’s divided verdict. “There is an inconsistency in the verdict as we read it,” he conceded, when asked by a reporter, “and we are...gonna review and figure out what it means and what options are open to us and we will pursue all available options.”</p> <p>Asked if his client was a “victim of politics,” Bohrer declined comment, but said, “Look, it was a difficult time and place to be trying a case involving Albany politics, there’s no question about that. We think that it was a much closer case than some were led to believe and I think the jury’s verdict is a reflection of that and so we are going to look at any and all options going forward in terms of pursuing further review.”</p> <p>A coalition of government reform groups called on the state Legislature and governor to pass reforms to prevent such corruption in the future. “Percoco’s trial spotlighted a state government riddled with pay to play, influence peddling and unethical behavior,” they said in a statement.</p> <p>The groups -- Citizens Union, Common Cause/NY, League of Women Voters, NYPIRG, and Reinvent Albany -- are calling for strict limits on campaign contributions from entities seeking state contracts; restrictions on outside income for state legislators and those in the executive branch; and closure of the so-called LLC loophole which allows limited liability companies with hidden donors to contribute large sums of money to state candidates. They are also pushing for greater accountability and transparency within the state budget, contracting, and more teeth for state ethics watchdogs and agencies with oversight of state economic development spending.</p> <p>Cuomo’s critics and opponents, including two Republican candidates for governor this year, pointed fingers at the Democratic incumbent for enabling a culture of corruption and called for an investigation into Cuomo allowing Percoco to use a government office while he was running the governor’s 2014 reelection campaign.</p> <p>The governor responded to the verdict In a statement put out Tuesday afternoon:</p> <blockquote> <p>"The jury has reached a verdict and I respect that decision. While I am sad for Joe Percoco's young daughters who will have to deal with this pain, I echo the message of the verdict - there is no tolerance for any violation of the public trust.<br /> <br />"There is no higher calling than public service and integrity is paramount - principles that have guided my work during the last 40 years.<br /> <br />"The verdict demonstrated that these ideals have been violated by someone I knew for a long time. That is personally painful; however, we must learn from what happened and put additional safeguards in place to secure the public trust. Anything less is unacceptable."</p> </blockquote> <p>

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by Samar Khurshid, City government reporter, Gotham Gazette
     

Read more by this writer.

</p>
<p><img src="http://www.gothamgazette.com/images/graphics/2018/percoco-lawyer-steps-of-courthouse.jpg" alt="percoco lawyer steps of courthouse" width="600" height="436" /></p> <p>Joe Percoco behind his lawyer (photo: Samar Khurshid/Gotham Gazette)</p> <hr /> <p>The jury in the federal corruption trial of Joseph Percoco, a former top aide to Governor Andrew Cuomo, returned with a verdict on Tuesday, finding Percoco guilty of two counts of conspiracy to commit honest services wire fraud and one count of soliciting bribes, charges related to a pair of bribery and bid-rigging schemes involving firms seeking to do business with the state. Percoco was also found not guilty on three charges he was facing.</p> <p>Over the course of more than seven weeks, the Percoco trial laid bare the inner workings of the state government and the lax regulations around government ethics and election financing. Prosecutors also touched on the functioning of the executive chamber, though no allegations of illegal wrongdoing were brought against Governor Andrew Cuomo, who once referred to his longtime friend Percoco as his father’s “third son.”</p> <p>After closing arguments last week, the jury deliberated for eight days -- and deadlocked twice -- before coming to a mixed verdict. In total, there were ten felony counts against Percoco and three co-defendants, upstate business executives who allegedly paid Percoco more than $300,000 for his help in getting favorable treatment from the state government. Former lobbyist Todd Howe, the government’s star witness in the case, pleaded guilty to facilitating the bribes to Percoco along with seven other felony counts related to the schemes.</p> <p>One of the bribery schemes involved the real estate developer COR Development and its executives, Joseph Gerardi and Steven Aiello, who were accused of bribing Percoco for assistance with labor unions on a real estate project as well as to obtain a raise for Aiello’s son. Both men faced charges of conspiracy to commit honest services wire fraud, paying bribes to Peroco and making false statements to federal investigators. Although Gerardi was found not guilty of all three charges, Aiello was found guilty on the conspiracy charge.</p> <p>The jury also deadlocked on two charges against Peter Galbraith Kelly, an executive from Competitive Power Ventures, an energy firm that was at the center of the second bribery scheme. Prosecutors alleged that Kelly organized a “low-show” job paying $90,000 a year for Percoco’s wife, which they said were actually bribes for Percoco. The jury’s decision led federal district judge Valerie Caproni to declare a mistrial for Kelly.</p> <p>Percoco himself was found not guilty on the three charges, including extortion under the color of official right, conspiracy to commit extortion under the color of official right, and soliciting bribes related to the COR scheme. He could face 50 years in prison on the three charges on which he was found guilty. Percoco’s sentencing is set for June 11; he and his lawyer said outside the courthouse that they would explore their legal options, including “what we might do in terms of making motions and pursuing our appellate rights.”</p> <p>At trial, prosecutors painted a picture of Percoco as the governor’s right-hand man, who could move mountains with a single phone call and who often bullied others in state government to do his bidding. The defense, however, sought to portray him as simply an “advance man” who managed events, scheduling, and day-to-day minutiae for the governor. The case was further complicated by the testimony of Howe, who was arrested midway through the trial after admitting to violating his cooperation agreement with the government. Although prosecutors, in their closing arguments, sought to downplay Howe’s role in the case, defense attorneys leaned heavily into the idea that Howe was a manipulative operator who was framing their clients for his own misdeeds.</p> <p>“Joseph Percoco was found guilty of taking over $300,000 in cash bribes by selling something priceless that was not his to sell – the sacred obligation to honestly and faithfully serve the citizens of New York,” said Manhattan U.S. Attorney Geoffrey Berman, in a statement after the verdict was announced. Berman said Percoco “corruptly chose to disregard” the fact that “government officials who sell their influence to select insiders violate the basic tenets of a democracy.”</p> <p>Speaking with reporters outside the courthouse, Percoco said he was “disappointed” with the verdict, but betrayed little emotion as he said he would consider the options with his lawyers. “I am thankful to my wonderful legal team and I‘m thankful to my family and friends that have stood by me throughout this entire process and I look forward to them all standing by me as we go forward,” he said.</p> <p>Barry Bohrer, Percoco’s defense attorney, questioned the jury’s divided verdict. “There is an inconsistency in the verdict as we read it,” he conceded, when asked by a reporter, “and we are...gonna review and figure out what it means and what options are open to us and we will pursue all available options.”</p> <p>Asked if his client was a “victim of politics,” Bohrer declined comment, but said, “Look, it was a difficult time and place to be trying a case involving Albany politics, there’s no question about that. We think that it was a much closer case than some were led to believe and I think the jury’s verdict is a reflection of that and so we are going to look at any and all options going forward in terms of pursuing further review.”</p> <p>A coalition of government reform groups called on the state Legislature and governor to pass reforms to prevent such corruption in the future. “Percoco’s trial spotlighted a state government riddled with pay to play, influence peddling and unethical behavior,” they said in a statement.</p> <p>The groups -- Citizens Union, Common Cause/NY, League of Women Voters, NYPIRG, and Reinvent Albany -- are calling for strict limits on campaign contributions from entities seeking state contracts; restrictions on outside income for state legislators and those in the executive branch; and closure of the so-called LLC loophole which allows limited liability companies with hidden donors to contribute large sums of money to state candidates. They are also pushing for greater accountability and transparency within the state budget, contracting, and more teeth for state ethics watchdogs and agencies with oversight of state economic development spending.</p> <p>Cuomo’s critics and opponents, including two Republican candidates for governor this year, pointed fingers at the Democratic incumbent for enabling a culture of corruption and called for an investigation into Cuomo allowing Percoco to use a government office while he was running the governor’s 2014 reelection campaign.</p> <p>The governor responded to the verdict In a statement put out Tuesday afternoon:</p> <blockquote> <p>"The jury has reached a verdict and I respect that decision. While I am sad for Joe Percoco's young daughters who will have to deal with this pain, I echo the message of the verdict - there is no tolerance for any violation of the public trust.<br /> <br />"There is no higher calling than public service and integrity is paramount - principles that have guided my work during the last 40 years.<br /> <br />"The verdict demonstrated that these ideals have been violated by someone I knew for a long time. That is personally painful; however, we must learn from what happened and put additional safeguards in place to secure the public trust. Anything less is unacceptable."</p> </blockquote> <p>

***
by Samar Khurshid, City government reporter, Gotham Gazette
     

Read more by this writer.

</p>
Adding to the Menu at the Coming Museum of Political Corruption in Albany 2018-03-11T05:00:00+00:00 2018-03-11T05:00:00+00:00 http://www.gothamgazette.com/?id=7531:adding-ziti-to-the-menu-at-the-coming-museum-of-political-corruption-in-albany Ben Max <p><img src="http://www.gothamgazette.com/images/graphics/2017/museum_of_corruption.jpeg" alt="museum of political corruption" width="600" height="297" /></p> <p>(image: Museum of Political Corruption)</p> <hr /> <p>The New York State legislature is <a href="http://www.politifact.com/new-york/statements/2016/sep/19/elaine-phillips/new-york-has-been-most-corrupt-state-decades/" target="_blank" rel="noopener">often cited</a> as the most corrupt in the nation and Bruce Roter, founder and president of the board of trustees of Albany’s upcoming <a href="http://www.museumofpoliticalcorruption.org/" target="_blank" rel="noopener">Museum of Political Corruption</a>, wants to tell the story of how we got there and help the state change course.</p> <p>A music professor by trade, Roter made a name for himself in the Albany area in 2012, when he led a successful grassroots campaign to bring Trader Joe’s to the capital region.</p> <p>Roter has since turned his energy to a somewhat more ambitious endeavor: tackling New York state government’s reputed “culture of corruption” by building an interactive, state-of-the-art, national attraction in downtown Albany.</p> <p><img src="http://www.gothamgazette.com/images/graphics/2017/bruce_roter.png" alt="bruce roter" width="250" height="321" style="margin-right: 12px; float: left;" />“We want to make sure we do this right. We want this museum to be a source of pride for our downtown,” said Roter (pictured), who has been plotting, planning, and building support for the not-for-profit museum for a few years.</p> <p>While the tentative open date for the brick-and-mortar location is in 2019, the museum team has kept the project in the limelight by hosting panel discussions and attending various events around town. On May 5, Nelly Bly’s birthday, the group will present its second annual Nelly Bly Award for investigative reporting, and a virtual exhibit may become available on the website soon. Susanne Craig of The New York Times was given the first Nelly Bly award in November 2017 at an event in downtown Albany.</p> <p>In an interview with Gotham Gazette, Roter discussed the museum’s progress and importance, this year’s series of state government-related corruption trials, and a very special menu item that will be featured in the museum’s “Cozy Crony Cafe.”</p> <p><em>The Q-and-A below is lightly edited for clarity.</em></p> <p>Gotham Gazette (GG): We seem to be in an important moment in New York corruption history. The fate of Governor Cuomo’s former top aide Joe Percoco is being decided, two former legislative leaders will be retried this spring, among others. Have you been keeping up with the headlines?</p> <p>Bruce Roter (BR): “I do try to follow when I can. It’s all very concerning, of course. On the one hand, it’s concerning, and on the other hand, I just remember that this is just one more stage in corruption that our state has had, and that’s the long-term view that we are taking.</p> <p>“There are those who think that this is probably the most corrupt time that New York has ever had. That’s not the truth at all. One can look at other eras, the 1800s, the 1900s, the Tammany Hall period, and other periods like that.</p> <p>“So I think we need a historical perspective when it comes to corruption, and thwarting immediate frustration. It didn’t happen overnight and it’s not going to get solved overnight.”</p> <p>GG: What’s the latest on the Museum of Corruption?</p> <p>BR: “We’re moving forward. We are still seeking sources of funding. We do want to build a state-of-the-art museum in downtown Albany. We’re definitely taking the long-term view, not only of our project, but of corruption in general. We can’t simply look at any particular headline. We understand that to fix corruption, it’s going to take a long-term cultural change, and that’s what we hope our institution will do.”</p> <p>GG: What birthed the idea to create a museum of corruption?</p> <p>BR: “I think the idea originally started because there were so many headlines of corruption back in 2012 and 2013. What started off as just an idea soon blossomed into a full-blown project, once I began discussing this with others, who also thought it was an excellent and unique idea and a way that we here in Albany could contribute to ethical governance in our state. That’s when we got serious and became chartered and are moving this forward.”</p> <p>GG: You are a music professor at the College of Saint Rose. Have you ever worked for government before, or is your interest in ethical governance a byproduct of growing up in Albany?</p> <p>BR: “I actually grew up downstate and I’ve been here 20 years now. I’ve always had an interest in government and public affairs even in my own creative work as a composer. I’ve often been inspired by public causes. I’m the composer of a piece called the Camp David Overture for the Middle East Peace Accords.</p> <p>“Several years ago, I was commissioned to write a piece for the Albany Symphony on speeches and writings of [President and New York State Governor] Theodore Roosevelt, and I became very inspired by him, especially Roosevelt’s call for the public to engage in the civil discourse of their community. So that’s what I’m seeking to do also.</p> <p>“Also, I have to admit, I have also enjoyed being part of the public discussion when I organized a grassroots campaign to bring Trader Joe’s to the capital district.”</p> <p>GG: Thank you for that…</p> <p>BR: “Well, yeah, everyone thanks me for that. Your quite welcome, I’m enjoying it myself. It was just the gratitude that I received from the community for being involved with that that has spurred my continued interest in working for the community. I feel the best way I can do that is to try and find an educational way that we can address governmental corruption.”</p> <p>GG: What’s the long game? Have you selected partners to run the museum while you are at your day job once you have a brick-and-mortar location?</p> <p>BR: “The long game is -- obviously, we do have a board of trustees -- is to hire a full staff, including an executive director, who is knowledgeable about museum management, running our museum as a museum ought to be run. We want this to be a first-class cultural institution for our city and a tourist draw at that.”</p> <p>GG: How will you keep up with the endless stream of headlines and corruption trials and incorporate them into the museum’s exhibits?</p> <p>BR: “We will keep up. We want the museum to be current. There will be rotating or evolving exhibits that will address what is going on currently, even as we also take the broader, historic view of corruption that has gone on for centuries in New York, as well as understanding the causes of corruption, and what we can do about corruption.</p> <p>“We do want to have in the museum what I’m calling Solutions Hall, where museum-goers will be invited to participate in discussing or uncovering solutions that can help us to achieve more ethical government.”</p> <p>GG: Have any lawmakers have reached out in support of this idea or taken an interest in this project?</p> <p>BR: “I can tell you that [Republican] Minority Assembly Leader Brian Kolb has been interested in our project -- along with some others. We are completely non-partisan and we want to make sure that we reach across the aisle and we want to bring all of our leaders onboard. Because this is not about a particular leader, this is about fixing our government and the public working with our leaders to create a better, more effective government.</p> <p>“I can tell you that one of the initiatives in which we are currently engaged is a collection of quotes on ethical leadership. We’re seeking quotes from leaders in a number of different fields, including politics and sports and religion and education. We do want to collect these quotes and perhaps even put them into a volume some day. We already received a quote -- a handwritten quote at that -- from former President Jimmy Carter, we’ve received a quote from Attorney General Eric Schneiderman, and one from Congressman Paul Tonko -- here in the Capital District -- and from Assemblymember Pat Fahy, and also Senator Ron Wyden of Oregon.</p> <p>“I want to make sure we have a wonderful, diverse representation of quotes on ethical leadership. Because even though we are a Museum of Political Corruption, we want to turn this around and make sure it leads to something positive.”</p> <p>GG: Corruption is certainly not limited to government. Do you hope that the ideas that come out of this will produce solutions that transcend government and apply to other institutions?</p> <p>BR: “Absolutely. I think it will. If we can address ethical leadership in one field, we can certainly address ethical leadership in every field. That’s of course why we want to get the leaders in the world of sports and arts and entertainment to engage with us in this search for bits of wisdom of how we can be more ethical in all facets of our society.”</p> <p>GG: So is the objective to educate the public about corruption or to solicit feedback and crowdsource some solutions to the problem?</p> <p>BR: “It’s both. Ultimately we want to educate and inform, but we also want to empower as well....For those people who are cynical and think nothing can ever be done and nothing can ever change, we hope that by the time they leave our exhibits, they too feel that they can make a difference in our society.</p> <p>“We look at all of these headlines, and trials, and retrials, and with tremendous respect to everything that’s is going on with our legislature and our prosecutors, we also think the public needs to get involved too. Of course, the best way and the first way we get involved is at the ballot booth. That’s why we feel education is import part of any change.</p> <p>“If there is indeed a culture of corruption in Albany, it’s going to take a cultural institution to fix it. And that’s what we are going to be: a cultural institution.”</p> <p>GG: Having moved to Albany last year to cover the Capitol, one thing I was struck by is how dramatic state government is, from the castle-like building, to the theatrics that happen daily on the Senate floor. As someone with a music background, do you plan to incorporate art, music, and performance into the museum’s exhibits?</p> <p>BR: “Of course! The whole discussion of public corruption can be held on so many levels. We’re going to have a Tammany Lecture hall in the museum where we can do panel discussions and public speaking, but can also do film theories or musical productions that address the subject as well. Art frequently has important things to say about what is going on in society. And so, I certainly want to encourage that.</p> <p>“I could also see us engaging or commissioning visual artists to have an art collection. We are certainly going to have a collection of political historic cartoons. So very much, art definitely has something to say about politics, and we will incorporate that into our design.”</p> <p>GG: Circling back to the current trials. Any new additions inspired by the trial of former Cuomo top aide Joe Percoco?</p> <p>BR: “You can expect that on the menu for the Cozy Crony Cafe we will be serving ziti.”</p> <p>

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by Rachel Silberstein, State government reporter, Gotham Gazette
     

Read more by this writer.

</p>
<p><img src="http://www.gothamgazette.com/images/graphics/2017/museum_of_corruption.jpeg" alt="museum of political corruption" width="600" height="297" /></p> <p>(image: Museum of Political Corruption)</p> <hr /> <p>The New York State legislature is <a href="http://www.politifact.com/new-york/statements/2016/sep/19/elaine-phillips/new-york-has-been-most-corrupt-state-decades/" target="_blank" rel="noopener">often cited</a> as the most corrupt in the nation and Bruce Roter, founder and president of the board of trustees of Albany’s upcoming <a href="http://www.museumofpoliticalcorruption.org/" target="_blank" rel="noopener">Museum of Political Corruption</a>, wants to tell the story of how we got there and help the state change course.</p> <p>A music professor by trade, Roter made a name for himself in the Albany area in 2012, when he led a successful grassroots campaign to bring Trader Joe’s to the capital region.</p> <p>Roter has since turned his energy to a somewhat more ambitious endeavor: tackling New York state government’s reputed “culture of corruption” by building an interactive, state-of-the-art, national attraction in downtown Albany.</p> <p><img src="http://www.gothamgazette.com/images/graphics/2017/bruce_roter.png" alt="bruce roter" width="250" height="321" style="margin-right: 12px; float: left;" />“We want to make sure we do this right. We want this museum to be a source of pride for our downtown,” said Roter (pictured), who has been plotting, planning, and building support for the not-for-profit museum for a few years.</p> <p>While the tentative open date for the brick-and-mortar location is in 2019, the museum team has kept the project in the limelight by hosting panel discussions and attending various events around town. On May 5, Nelly Bly’s birthday, the group will present its second annual Nelly Bly Award for investigative reporting, and a virtual exhibit may become available on the website soon. Susanne Craig of The New York Times was given the first Nelly Bly award in November 2017 at an event in downtown Albany.</p> <p>In an interview with Gotham Gazette, Roter discussed the museum’s progress and importance, this year’s series of state government-related corruption trials, and a very special menu item that will be featured in the museum’s “Cozy Crony Cafe.”</p> <p><em>The Q-and-A below is lightly edited for clarity.</em></p> <p>Gotham Gazette (GG): We seem to be in an important moment in New York corruption history. The fate of Governor Cuomo’s former top aide Joe Percoco is being decided, two former legislative leaders will be retried this spring, among others. Have you been keeping up with the headlines?</p> <p>Bruce Roter (BR): “I do try to follow when I can. It’s all very concerning, of course. On the one hand, it’s concerning, and on the other hand, I just remember that this is just one more stage in corruption that our state has had, and that’s the long-term view that we are taking.</p> <p>“There are those who think that this is probably the most corrupt time that New York has ever had. That’s not the truth at all. One can look at other eras, the 1800s, the 1900s, the Tammany Hall period, and other periods like that.</p> <p>“So I think we need a historical perspective when it comes to corruption, and thwarting immediate frustration. It didn’t happen overnight and it’s not going to get solved overnight.”</p> <p>GG: What’s the latest on the Museum of Corruption?</p> <p>BR: “We’re moving forward. We are still seeking sources of funding. We do want to build a state-of-the-art museum in downtown Albany. We’re definitely taking the long-term view, not only of our project, but of corruption in general. We can’t simply look at any particular headline. We understand that to fix corruption, it’s going to take a long-term cultural change, and that’s what we hope our institution will do.”</p> <p>GG: What birthed the idea to create a museum of corruption?</p> <p>BR: “I think the idea originally started because there were so many headlines of corruption back in 2012 and 2013. What started off as just an idea soon blossomed into a full-blown project, once I began discussing this with others, who also thought it was an excellent and unique idea and a way that we here in Albany could contribute to ethical governance in our state. That’s when we got serious and became chartered and are moving this forward.”</p> <p>GG: You are a music professor at the College of Saint Rose. Have you ever worked for government before, or is your interest in ethical governance a byproduct of growing up in Albany?</p> <p>BR: “I actually grew up downstate and I’ve been here 20 years now. I’ve always had an interest in government and public affairs even in my own creative work as a composer. I’ve often been inspired by public causes. I’m the composer of a piece called the Camp David Overture for the Middle East Peace Accords.</p> <p>“Several years ago, I was commissioned to write a piece for the Albany Symphony on speeches and writings of [President and New York State Governor] Theodore Roosevelt, and I became very inspired by him, especially Roosevelt’s call for the public to engage in the civil discourse of their community. So that’s what I’m seeking to do also.</p> <p>“Also, I have to admit, I have also enjoyed being part of the public discussion when I organized a grassroots campaign to bring Trader Joe’s to the capital district.”</p> <p>GG: Thank you for that…</p> <p>BR: “Well, yeah, everyone thanks me for that. Your quite welcome, I’m enjoying it myself. It was just the gratitude that I received from the community for being involved with that that has spurred my continued interest in working for the community. I feel the best way I can do that is to try and find an educational way that we can address governmental corruption.”</p> <p>GG: What’s the long game? Have you selected partners to run the museum while you are at your day job once you have a brick-and-mortar location?</p> <p>BR: “The long game is -- obviously, we do have a board of trustees -- is to hire a full staff, including an executive director, who is knowledgeable about museum management, running our museum as a museum ought to be run. We want this to be a first-class cultural institution for our city and a tourist draw at that.”</p> <p>GG: How will you keep up with the endless stream of headlines and corruption trials and incorporate them into the museum’s exhibits?</p> <p>BR: “We will keep up. We want the museum to be current. There will be rotating or evolving exhibits that will address what is going on currently, even as we also take the broader, historic view of corruption that has gone on for centuries in New York, as well as understanding the causes of corruption, and what we can do about corruption.</p> <p>“We do want to have in the museum what I’m calling Solutions Hall, where museum-goers will be invited to participate in discussing or uncovering solutions that can help us to achieve more ethical government.”</p> <p>GG: Have any lawmakers have reached out in support of this idea or taken an interest in this project?</p> <p>BR: “I can tell you that [Republican] Minority Assembly Leader Brian Kolb has been interested in our project -- along with some others. We are completely non-partisan and we want to make sure that we reach across the aisle and we want to bring all of our leaders onboard. Because this is not about a particular leader, this is about fixing our government and the public working with our leaders to create a better, more effective government.</p> <p>“I can tell you that one of the initiatives in which we are currently engaged is a collection of quotes on ethical leadership. We’re seeking quotes from leaders in a number of different fields, including politics and sports and religion and education. We do want to collect these quotes and perhaps even put them into a volume some day. We already received a quote -- a handwritten quote at that -- from former President Jimmy Carter, we’ve received a quote from Attorney General Eric Schneiderman, and one from Congressman Paul Tonko -- here in the Capital District -- and from Assemblymember Pat Fahy, and also Senator Ron Wyden of Oregon.</p> <p>“I want to make sure we have a wonderful, diverse representation of quotes on ethical leadership. Because even though we are a Museum of Political Corruption, we want to turn this around and make sure it leads to something positive.”</p> <p>GG: Corruption is certainly not limited to government. Do you hope that the ideas that come out of this will produce solutions that transcend government and apply to other institutions?</p> <p>BR: “Absolutely. I think it will. If we can address ethical leadership in one field, we can certainly address ethical leadership in every field. That’s of course why we want to get the leaders in the world of sports and arts and entertainment to engage with us in this search for bits of wisdom of how we can be more ethical in all facets of our society.”</p> <p>GG: So is the objective to educate the public about corruption or to solicit feedback and crowdsource some solutions to the problem?</p> <p>BR: “It’s both. Ultimately we want to educate and inform, but we also want to empower as well....For those people who are cynical and think nothing can ever be done and nothing can ever change, we hope that by the time they leave our exhibits, they too feel that they can make a difference in our society.</p> <p>“We look at all of these headlines, and trials, and retrials, and with tremendous respect to everything that’s is going on with our legislature and our prosecutors, we also think the public needs to get involved too. Of course, the best way and the first way we get involved is at the ballot booth. That’s why we feel education is import part of any change.</p> <p>“If there is indeed a culture of corruption in Albany, it’s going to take a cultural institution to fix it. And that’s what we are going to be: a cultural institution.”</p> <p>GG: Having moved to Albany last year to cover the Capitol, one thing I was struck by is how dramatic state government is, from the castle-like building, to the theatrics that happen daily on the Senate floor. As someone with a music background, do you plan to incorporate art, music, and performance into the museum’s exhibits?</p> <p>BR: “Of course! The whole discussion of public corruption can be held on so many levels. We’re going to have a Tammany Lecture hall in the museum where we can do panel discussions and public speaking, but can also do film theories or musical productions that address the subject as well. Art frequently has important things to say about what is going on in society. And so, I certainly want to encourage that.</p> <p>“I could also see us engaging or commissioning visual artists to have an art collection. We are certainly going to have a collection of political historic cartoons. So very much, art definitely has something to say about politics, and we will incorporate that into our design.”</p> <p>GG: Circling back to the current trials. Any new additions inspired by the trial of former Cuomo top aide Joe Percoco?</p> <p>BR: “You can expect that on the menu for the Cozy Crony Cafe we will be serving ziti.”</p> <p>

***
by Rachel Silberstein, State government reporter, Gotham Gazette
     

Read more by this writer.

</p>
After Prosecutors' Final Rebuttal, Jury Deliberations Begin in Percoco Trial 2018-03-01T22:47:02+00:00 2018-03-01T22:47:02+00:00 http://www.gothamgazette.com/?id=7511:after-prosecutorial-rebuttal-jury-deliberations-begin-in-percoco-trial Ben Max <p>&nbsp;<img src="http://www.gothamgazette.com/images/graphics/2017/percoco-legal-team.jpg" alt="percoco legal team" width="600" height="364" /></p> <p>Joseph Percoco, rear, his legal team, and others (photo: Samar Khurshid)</p> <hr /> <p>Jury deliberations began Thursday in the federal corruption trial of Joseph Percoco, a former top aide to Governor Andrew Cuomo, and three corporate executives who were allegedly involved in a criminal conspiracy to pay Percoco bribes in exchange for favorable official actions in their efforts to do business with the state government.</p> <p>In federal district court in lower Manhattan on Thursday morning, the prosecution offered its rebuttal to the defense’s closing arguments from the previous two days, capping a six-week long trial that has exposed the inner workings of the state government and put on display the actions and behavior of Percoco, whom Cuomo once referred to as “my father's third son.” The trial has raised questions about what Cuomo knew about Percoco’s activities, including his former top aide’s use of a government office while technically on leave to run Cuomo’s reelection campaign.</p> <p>The charges against Percoco and his co-defendants -- Peter Galbraith Kelly, Joseph Gerardi and Steven Aiello -- stem from two separate bribery schemes tied together by the government’s key witness, former lobbyist Todd Howe, who pleaded guilty to facilitating payments totalling more than $300,000 from the executives to Percoco and his wife, Lisa Percoco.</p> <p>Percoco and the others have been charged with ten felony counts of solicitation and payment of bribes and gratuities, conspiracy to commit honest services fraud, extortion under the color of official right and conspiracy to commit extortion under the color of official right, wire fraud, and making false statements to federal investigators. (One extortion charge, related to actions Percoco took while he was working on the governor’s reelection campaign in 2014, was dismissed by U.S. District Judge Valerie Caproni on Monday.)</p> <p>One of the schemes involved real estate developer COR Development and it’s executives Gerardi and Aiello. The second involved energy firm Competitive Power Ventures and Kelly, who is accused of giving Percoco’s wife a “low-show” job paying $90,000 annually.</p> <p>The defense largely based its case on attacking Howe’s credibility as a witness, claiming that he manipulated Percoco and the others into the schemes. Once he was caught for his own crimes, the defense attorneys claimed, he pointed fingers to try and reduce his prison sentence. That argument was bolstered in part when Howe was arrested during the trial for violating his cooperation agreement with the government.</p> <p>Prosecutors, however, have pointed to other evidence, including thousands of emails, that they say shows the corrupt agreements struck between the defendants. Howe’s testimony formed only a part of their case, they claim, and was far from the foundation of the prosecution.</p> <p>“Their best defense is to make you think it all comes down to Todd Howe,” said prosecutor Janis Echenberg, in the government’s rebuttal Thursday morning. “See the defense arguments for what they are. They are asking for a free pass. They’re saying ‘We dealt with a bad guy so we should get away with it.’”</p> <p>Echenberg also sought to counter the “friendship defense” forwarded by attorneys for both Percoco and Kelly, who claimed that the two did favors for each others because they were close friends. One example the defense cited was Percoco and Kelly going on a fishing trip together.</p> <p>“This whole fishing sideshow,” Echenberg told the jury, “You’re being played hook, line and sinker.”</p> <p>“Even if there was a friendship between them...you don’t get a pass on bribery just because you’re bribing a friend,” she added.</p> <p>After Echenberg’s plea to the jury for a guilty verdict, Judge Caproni addressed the jury, reading through a 40-page booklet of all the charges against the defendants and instructing them to carefully consider their decision.</p> <p>Later in the day, the jury sought clarification on whether Percoco had to have been a public official throughout the duration of the two schemes he is accused of participating in in order to be found guilty. The prosecution had argued that though Percoco left state government to work on the governor’s reelection campaign, he still wielded his influence within state government to pressure officials for favorable action towards his co-defendants. The defense, on the other hand, in the words of Percoco’s lawyer Barry Bohrer, said Percoco couldn’t possibly have been “selling his office” during the campaign since “he had no office to sell.”</p> <p>

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by Samar Khurshid, City government reporter, Gotham Gazette
     

Read more by this writer.

</p>
<p>&nbsp;<img src="http://www.gothamgazette.com/images/graphics/2017/percoco-legal-team.jpg" alt="percoco legal team" width="600" height="364" /></p> <p>Joseph Percoco, rear, his legal team, and others (photo: Samar Khurshid)</p> <hr /> <p>Jury deliberations began Thursday in the federal corruption trial of Joseph Percoco, a former top aide to Governor Andrew Cuomo, and three corporate executives who were allegedly involved in a criminal conspiracy to pay Percoco bribes in exchange for favorable official actions in their efforts to do business with the state government.</p> <p>In federal district court in lower Manhattan on Thursday morning, the prosecution offered its rebuttal to the defense’s closing arguments from the previous two days, capping a six-week long trial that has exposed the inner workings of the state government and put on display the actions and behavior of Percoco, whom Cuomo once referred to as “my father's third son.” The trial has raised questions about what Cuomo knew about Percoco’s activities, including his former top aide’s use of a government office while technically on leave to run Cuomo’s reelection campaign.</p> <p>The charges against Percoco and his co-defendants -- Peter Galbraith Kelly, Joseph Gerardi and Steven Aiello -- stem from two separate bribery schemes tied together by the government’s key witness, former lobbyist Todd Howe, who pleaded guilty to facilitating payments totalling more than $300,000 from the executives to Percoco and his wife, Lisa Percoco.</p> <p>Percoco and the others have been charged with ten felony counts of solicitation and payment of bribes and gratuities, conspiracy to commit honest services fraud, extortion under the color of official right and conspiracy to commit extortion under the color of official right, wire fraud, and making false statements to federal investigators. (One extortion charge, related to actions Percoco took while he was working on the governor’s reelection campaign in 2014, was dismissed by U.S. District Judge Valerie Caproni on Monday.)</p> <p>One of the schemes involved real estate developer COR Development and it’s executives Gerardi and Aiello. The second involved energy firm Competitive Power Ventures and Kelly, who is accused of giving Percoco’s wife a “low-show” job paying $90,000 annually.</p> <p>The defense largely based its case on attacking Howe’s credibility as a witness, claiming that he manipulated Percoco and the others into the schemes. Once he was caught for his own crimes, the defense attorneys claimed, he pointed fingers to try and reduce his prison sentence. That argument was bolstered in part when Howe was arrested during the trial for violating his cooperation agreement with the government.</p> <p>Prosecutors, however, have pointed to other evidence, including thousands of emails, that they say shows the corrupt agreements struck between the defendants. Howe’s testimony formed only a part of their case, they claim, and was far from the foundation of the prosecution.</p> <p>“Their best defense is to make you think it all comes down to Todd Howe,” said prosecutor Janis Echenberg, in the government’s rebuttal Thursday morning. “See the defense arguments for what they are. They are asking for a free pass. They’re saying ‘We dealt with a bad guy so we should get away with it.’”</p> <p>Echenberg also sought to counter the “friendship defense” forwarded by attorneys for both Percoco and Kelly, who claimed that the two did favors for each others because they were close friends. One example the defense cited was Percoco and Kelly going on a fishing trip together.</p> <p>“This whole fishing sideshow,” Echenberg told the jury, “You’re being played hook, line and sinker.”</p> <p>“Even if there was a friendship between them...you don’t get a pass on bribery just because you’re bribing a friend,” she added.</p> <p>After Echenberg’s plea to the jury for a guilty verdict, Judge Caproni addressed the jury, reading through a 40-page booklet of all the charges against the defendants and instructing them to carefully consider their decision.</p> <p>Later in the day, the jury sought clarification on whether Percoco had to have been a public official throughout the duration of the two schemes he is accused of participating in in order to be found guilty. The prosecution had argued that though Percoco left state government to work on the governor’s reelection campaign, he still wielded his influence within state government to pressure officials for favorable action towards his co-defendants. The defense, on the other hand, in the words of Percoco’s lawyer Barry Bohrer, said Percoco couldn’t possibly have been “selling his office” during the campaign since “he had no office to sell.”</p> <p>

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by Samar Khurshid, City government reporter, Gotham Gazette
     

Read more by this writer.

</p>
Defense Concludes Closing Arguments in Percoco Trial 2018-02-28T05:00:00+00:00 2018-02-28T05:00:00+00:00 http://www.gothamgazette.com/?id=7507:defense-concludes-closing-arguments-in-percoco-trial Ben Max <p><img src="http://www.gothamgazette.com/images/graphics/2018/j-percoco.jpg" alt="j percoco" width="600" height="324" /></p> <p>Barry Bohrer and his client, Joseph Percoco, behind (photo: Samar Khurshid)</p> <hr /> <p>Joseph Percoco, a former top aide to Governor Andrew Cuomo, was not “one of the most powerful officials in state government,” argued Barry Bohrer, Percoco’s defense attorney, on Wednesday, the second day of closing arguments in the federal corruption trial of Percoco and three corporate executives, Joseph Gerardi, Steven Aiello, and Peter Galbraith Kelly.</p> <p>Percoco and the others face charges of bribery, fraud, and bid-rigging related to two separate schemes involving state contracts. The prosecution, which made its own closing argument on Tuesday, has alleged that Percoco used the immense power at his disposal to assist his co-defendants. “For a state employee, getting a call from Percoco was like getting a call from the governor himself,” said Assistant U.S. Attorney Robert Boone in his opening statement when the trial began six weeks ago.</p> <p>But Bohrer sought to counter that image, which he said was conjured by prosecutors and former lobbyist Todd Howe, a cooperating government witness who pleaded guilty to several felonies and admitted to facilitating the bribes that Percoco allegedly received. &nbsp;</p> <p>Attorneys for each of the four defendants hammered home the notion that Howe is an unreliable witness who has sought to scapegoat their clients for his own misdoings and criminal schemes. Bohrer, who spoke last and longest over the last two days, said, in the government and Howe’s view, “apparently, there’s no one bigger than Joe Percoco. But you know from the evidence that that’s an exaggeration, that’s a stretch, that’s Todd Howe in action.”</p> <p>Bohrer downplayed the influence that Percoco had in state government, calling him more of an “advance man” for the governor whose duties included office management, personnel relations, intergovernmental relations, and labor relations. Percoco was not “the guy who ruled the roost” in New York State, Bohrer said, but rather “the guy who takes care of his friends,” “who rolls out the red carpet,” “who greets them with a firm handshake.”</p> <p>Percoco, he said, never entered into a “corrupt bargain” to sell his office for personal gain and that the actions he is accused of taking to benefit his co-defendants were simply favors for his friends.</p> <p>“The government’s case is all talk, no action -- certainly no official action,” Bohrer said Wednesday, emphasizing that the definition of an official act under federal corruption statutes is limited. &nbsp;</p> <p>As with the other attorneys, Bohrer described Howe as a “pathological liar, a congenital liar,” who exploited the better nature of the individuals on trial, who were his close friends. “Todd Howe described Joe Percoco as a brother, just like Cain described Abel,” he said.</p> <p>Howe, who was a go-between for Percoco and the other defendants, has a long history with both Percoco and Cuomo and a checkered past, with a prior felony conviction and a laundry list of misdeeds to his name. During the course of the trial, in which thousands of emails were entered into evidence, much of that was laid bare, including Howe’s tendency to alter emails when forwarding them to others to either bolster his own standing or to mislead the recipients of those emails. “Mr. Howe was the butcher of emails. He was Mr. Cut and Mr. Paste,” Bohrer said.</p> <p>Bohrer also rejected the prosecution’s contention that Percoco turned to a criminal conspiracy because he faced financial troubles. That was just another lie manufactured by Howe, Bohrer insisted. “Mr. Todd ‘Ransom’ Howe...he thought he could save himself by providing ‘substantial assistance in the prosecution of another,’” he said, using a legal term in Howe’s cooperation agreement with the government. &nbsp;</p> <p>Earlier in the day, Daniel Gitner, the lawyer for Peter Galbraith Kelly, had also concluded his closing statement, reiterating that the government was attempting to “whitewash” Howe’s part in the prosecution. &nbsp;</p> <p>On Tuesday, <a href="http://www.gothamgazette.com/state/7506-prosecutors-make-closing-argument-in-trial-of-former-top-cuomo-aide" target="_blank" rel="noopener">prosecutors summed up their case</a>, arguing that the defense attorneys would attempt to confuse the jury and complicate a corruption case that involved a very straightforward quid-pro-quo between the defendants. Bohrer, in turn, said Wednesday that it was the prosecution that had muddied the waters, particularly by repeatedly citing emails in which Howe and Percoco spoke of “ziti,” a term that the prosecution said they adopted from the television show “The Sopranos” as a code for bribes.</p> <p>“It’s not the language of criminals,” Bohrer said, in a reference to <a href="http://www.gothamgazette.com/state/7506-prosecutors-make-closing-argument-in-trial-of-former-top-cuomo-aide" target="_blank" rel="noopener">the prosecution’s closing argument from Tuesday</a>, “just because someone watches “The Sopranos” and picks up a phrase from “The Sopranos.” Millions of people would be in jumpsuits if they watched “The Sopranos” and picked up the language, if that were the case.”</p> <p>“You’ll find 16 ‘ziti’ emails and the score is 14 to 2,” he said, insisting that the term originated with Howe. “There are 14 instances in which Howe mentions the word and two where Joe does.”</p> <p>Outside the federal courthouse in lower Manhattan, in brief comments to reporters, Bohrer again criticized the prosecution’s focus on the “ziti.”</p> <p>“It <em>has</em> been a diversion,” he said, when asked by a reporter. “The evidence is totally lacking with regards to the changes.”</p> <p>Percoco stood somber behind Bohrer, betraying little emotion. When asked how he felt about his lawyer’s closing, he said, “Barry’s doing all the talking now. He’s doing great.”</p> <p>On Thursday morning, prosecutors will offer their rebuttal to the defense’s closing arguments. They will have a total of two hours to do so, Judge Valerie Caproni said Wednesday. The judge will then read all the charges to the jury and they will likely head into deliberations Thursday afternoon.</p> <p>

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by Samar Khurshid, City government reporter, Gotham Gazette
     

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</p>
<p><img src="http://www.gothamgazette.com/images/graphics/2018/j-percoco.jpg" alt="j percoco" width="600" height="324" /></p> <p>Barry Bohrer and his client, Joseph Percoco, behind (photo: Samar Khurshid)</p> <hr /> <p>Joseph Percoco, a former top aide to Governor Andrew Cuomo, was not “one of the most powerful officials in state government,” argued Barry Bohrer, Percoco’s defense attorney, on Wednesday, the second day of closing arguments in the federal corruption trial of Percoco and three corporate executives, Joseph Gerardi, Steven Aiello, and Peter Galbraith Kelly.</p> <p>Percoco and the others face charges of bribery, fraud, and bid-rigging related to two separate schemes involving state contracts. The prosecution, which made its own closing argument on Tuesday, has alleged that Percoco used the immense power at his disposal to assist his co-defendants. “For a state employee, getting a call from Percoco was like getting a call from the governor himself,” said Assistant U.S. Attorney Robert Boone in his opening statement when the trial began six weeks ago.</p> <p>But Bohrer sought to counter that image, which he said was conjured by prosecutors and former lobbyist Todd Howe, a cooperating government witness who pleaded guilty to several felonies and admitted to facilitating the bribes that Percoco allegedly received. &nbsp;</p> <p>Attorneys for each of the four defendants hammered home the notion that Howe is an unreliable witness who has sought to scapegoat their clients for his own misdoings and criminal schemes. Bohrer, who spoke last and longest over the last two days, said, in the government and Howe’s view, “apparently, there’s no one bigger than Joe Percoco. But you know from the evidence that that’s an exaggeration, that’s a stretch, that’s Todd Howe in action.”</p> <p>Bohrer downplayed the influence that Percoco had in state government, calling him more of an “advance man” for the governor whose duties included office management, personnel relations, intergovernmental relations, and labor relations. Percoco was not “the guy who ruled the roost” in New York State, Bohrer said, but rather “the guy who takes care of his friends,” “who rolls out the red carpet,” “who greets them with a firm handshake.”</p> <p>Percoco, he said, never entered into a “corrupt bargain” to sell his office for personal gain and that the actions he is accused of taking to benefit his co-defendants were simply favors for his friends.</p> <p>“The government’s case is all talk, no action -- certainly no official action,” Bohrer said Wednesday, emphasizing that the definition of an official act under federal corruption statutes is limited. &nbsp;</p> <p>As with the other attorneys, Bohrer described Howe as a “pathological liar, a congenital liar,” who exploited the better nature of the individuals on trial, who were his close friends. “Todd Howe described Joe Percoco as a brother, just like Cain described Abel,” he said.</p> <p>Howe, who was a go-between for Percoco and the other defendants, has a long history with both Percoco and Cuomo and a checkered past, with a prior felony conviction and a laundry list of misdeeds to his name. During the course of the trial, in which thousands of emails were entered into evidence, much of that was laid bare, including Howe’s tendency to alter emails when forwarding them to others to either bolster his own standing or to mislead the recipients of those emails. “Mr. Howe was the butcher of emails. He was Mr. Cut and Mr. Paste,” Bohrer said.</p> <p>Bohrer also rejected the prosecution’s contention that Percoco turned to a criminal conspiracy because he faced financial troubles. That was just another lie manufactured by Howe, Bohrer insisted. “Mr. Todd ‘Ransom’ Howe...he thought he could save himself by providing ‘substantial assistance in the prosecution of another,’” he said, using a legal term in Howe’s cooperation agreement with the government. &nbsp;</p> <p>Earlier in the day, Daniel Gitner, the lawyer for Peter Galbraith Kelly, had also concluded his closing statement, reiterating that the government was attempting to “whitewash” Howe’s part in the prosecution. &nbsp;</p> <p>On Tuesday, <a href="http://www.gothamgazette.com/state/7506-prosecutors-make-closing-argument-in-trial-of-former-top-cuomo-aide" target="_blank" rel="noopener">prosecutors summed up their case</a>, arguing that the defense attorneys would attempt to confuse the jury and complicate a corruption case that involved a very straightforward quid-pro-quo between the defendants. Bohrer, in turn, said Wednesday that it was the prosecution that had muddied the waters, particularly by repeatedly citing emails in which Howe and Percoco spoke of “ziti,” a term that the prosecution said they adopted from the television show “The Sopranos” as a code for bribes.</p> <p>“It’s not the language of criminals,” Bohrer said, in a reference to <a href="http://www.gothamgazette.com/state/7506-prosecutors-make-closing-argument-in-trial-of-former-top-cuomo-aide" target="_blank" rel="noopener">the prosecution’s closing argument from Tuesday</a>, “just because someone watches “The Sopranos” and picks up a phrase from “The Sopranos.” Millions of people would be in jumpsuits if they watched “The Sopranos” and picked up the language, if that were the case.”</p> <p>“You’ll find 16 ‘ziti’ emails and the score is 14 to 2,” he said, insisting that the term originated with Howe. “There are 14 instances in which Howe mentions the word and two where Joe does.”</p> <p>Outside the federal courthouse in lower Manhattan, in brief comments to reporters, Bohrer again criticized the prosecution’s focus on the “ziti.”</p> <p>“It <em>has</em> been a diversion,” he said, when asked by a reporter. “The evidence is totally lacking with regards to the changes.”</p> <p>Percoco stood somber behind Bohrer, betraying little emotion. When asked how he felt about his lawyer’s closing, he said, “Barry’s doing all the talking now. He’s doing great.”</p> <p>On Thursday morning, prosecutors will offer their rebuttal to the defense’s closing arguments. They will have a total of two hours to do so, Judge Valerie Caproni said Wednesday. The judge will then read all the charges to the jury and they will likely head into deliberations Thursday afternoon.</p> <p>

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by Samar Khurshid, City government reporter, Gotham Gazette
     

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</p>
Prosecutors Make Closing Argument in Trial of Former Top Cuomo Aide 2018-02-27T05:00:00+00:00 2018-02-27T05:00:00+00:00 http://www.gothamgazette.com/?id=7506:prosecutors-make-closing-argument-in-trial-of-former-top-cuomo-aide Ben Max <p><img src="http://www.gothamgazette.com/images/graphics/2017/40424933161_d40662c725_z.jpg" alt="Cuomo Percoco" width="600" height="460" /></p> <p>Governor Cuomo (photo:&nbsp;Mike Groll/Governor's Office)</p> <hr /> <p>The federal corruption trial of Joseph Percoco, a former top aide and close ally of Governor Andrew Cuomo, and three co-defendants reached near conclusion with prosecutors making closing arguments to the jury on Tuesday.</p> <p>Percoco and the three others, all corporate executives, face several bribery, bid-rigging and fraud charges related to state contracts sought by the companies represented by Percoco’s co-defendants. Percoco was charged with accepting bribes amounting to more than $300,000 from the three businessmen -- Joseph Gerardi, Steven Aiello and Peter Galbraith Kelly -- with whom he was involved in a broad criminal conspiracy, prosecutors have alleged.</p> <p>At a federal court in lower Manhattan, prosecutor David Zhou summarized more than six weeks of testimony in a final plea to jurors for a guilty verdict, reading a selection from thousands of emails that were presented as evidence in the trial.</p> <p>“‘Where the hell is the ziti?’” Zhou cited from an email sent by Percoco from his personal AOL account to lobbyist Todd Howe, a former lobbyist and Cuomo ally who played middleman in the conspiracy and is a cooperating government witness who pleaded guilty to several counts himself. The term “ziti” was thrown around hundreds of times between Howe and Percoco, old friends, and referred to bribes, as appropriated by the men from “The Sopranos,” the popular television show featuring the eponymous mafia family.</p> <p>“These are Joe Percoco’s own words...begging, requesting, demanding ‘ziti,’” Zhou told the jurors.</p> <p>Zhou meticulously laid out the prosecution’s case over the course of about three hours, detailing how Percoco allegedly wielded his powerful position in the governor’s office to take favorable official actions towards two firms, COR Development and Competitive Power Ventures, in corrupt exchanges with executives from the companies. Howe, in turn, funnelled payments from the firms to Percoco and to his wife, Lisa Percoco, who received a “low-show” job from CPV paying $90,000 a year for little work. “Ladies and gentlemen, you’ve put more time into this trial than Lisa Percoco did from her $90,000-a-year job,” Zhou said.</p> <p>The prosecution’s case was complicated when, earlier this month, Howe admitted to attempted credit card fraud on the witness stand, violating his cooperation agreement with the government and leading to his arrest as the trial progressed.</p> <p>As they began their closing arguments, lawyers for the defense emphasized Tuesday that Howe is an unreliable witness who is attempting to save himself from jail time.</p> <p>The prosecution tried to preempt that argument, with Zhou telling the jury he expected the defendants to attack Howe’s credibility. “They’re hoping to distract you from the clear evidence in this case. Don’t let them,” he said, emphasizing that Howe’s testimony was only a part of their case and that a massive paper trail implicated the defendants and did not depend on Howe. “You don’t need an insider’s view to convict these defendants.They convict themselves,” he said.</p> <p>After Zhou concluded, lawyers for Percoco’s co-defendants took their turns tearing into Howe while describing their clients as unwitting victims of a “master manipulator” who has even fooled the government.</p> <p>“The government’s case is heavily leveraged on Howe,” said Milton Williams, an attorney for Gerardi, a COR Development executive. Williams said Howe’s talent with the “magic phone call game” made him an effective operator who lobbied government officials and got things done with a simple phone call.</p> <p>Howe, he said, controlled “the flow of information” between all the defendants and that Gerardi was “played for a fool” like the others. “It’s up to you to stop the damage of Todd Howe,” Williams told the jury.</p> <p>COR executive Steven Aiello’s attorney, Stephen Coffey, did not hold back as he spent two hours painting the image of Howe as the mastermind who played both sides and entrapped his client in the different schemes that make up the charges. “The only person spinning this web tangled with lies...is Howe,” he said, describing Howe as a “walking, talking reasonable doubt.”</p> <p>“If ever a man exemplified reasonable doubt, it’s Todd Howe,” he said.</p> <p>Coffey also attempted to draw a line between the charges faced by Aiello and Gerardi as opposed to those faced by Kelly and Percoco. “Anything you find went on with the Kelly matter or the Percoco matter, we’re not involved in it,” he said. “There’s no ‘ziti’ with Steven Aiello and Joe Gerardi.”</p> <p>CVP executive Peter Galbraith Kelly’s lawyer, Daniel Gitner, also addressed the jury Tuesday, portraying the relationship between his client and Percoco as a close friendship. “Braith’s actions were never the actions of a man who thought he’d rigged the system,” Gitner said, using a nickname for Kelly. “Quid pro nada,” he added.</p> <p>Instead, Gitner said Kelly was simply a generous man who wanted to help a friend in financial distress with no expectation of any favors in return. “No such agreement was discussed. No such bargain was struck,” he said, explaining the circumstances of the how Kelly’s company gave a job to Percoco’s wife.</p> <p>Gitner also accused the prosecution of attempting to “whitewash” Howe’s contribution to its case in closing statements after “touting” him in the trail’s opening remarks. Just over an hour into his closing, Gitner was barely halfway done before the court adjourned for the day. Closing arguments will continue and may conclude on Wednesday, possibly leading to initial jury deliberations the following day.</p> <p>The trial has raised a number of questions about Governor Cuomo's knowledge of Percoco's behavior and ways in which Cuomo oversaw both his reelection campaign and government administration. Cuomo has declined to answer any media questions about the trial, saying it wouldn't be appropriate given the ongoing trial and his self-professed respect for the legal process.</p> <p>

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by Samar Khurshid, City government reporter, Gotham Gazette
     

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</p>
<p><img src="http://www.gothamgazette.com/images/graphics/2017/40424933161_d40662c725_z.jpg" alt="Cuomo Percoco" width="600" height="460" /></p> <p>Governor Cuomo (photo:&nbsp;Mike Groll/Governor's Office)</p> <hr /> <p>The federal corruption trial of Joseph Percoco, a former top aide and close ally of Governor Andrew Cuomo, and three co-defendants reached near conclusion with prosecutors making closing arguments to the jury on Tuesday.</p> <p>Percoco and the three others, all corporate executives, face several bribery, bid-rigging and fraud charges related to state contracts sought by the companies represented by Percoco’s co-defendants. Percoco was charged with accepting bribes amounting to more than $300,000 from the three businessmen -- Joseph Gerardi, Steven Aiello and Peter Galbraith Kelly -- with whom he was involved in a broad criminal conspiracy, prosecutors have alleged.</p> <p>At a federal court in lower Manhattan, prosecutor David Zhou summarized more than six weeks of testimony in a final plea to jurors for a guilty verdict, reading a selection from thousands of emails that were presented as evidence in the trial.</p> <p>“‘Where the hell is the ziti?’” Zhou cited from an email sent by Percoco from his personal AOL account to lobbyist Todd Howe, a former lobbyist and Cuomo ally who played middleman in the conspiracy and is a cooperating government witness who pleaded guilty to several counts himself. The term “ziti” was thrown around hundreds of times between Howe and Percoco, old friends, and referred to bribes, as appropriated by the men from “The Sopranos,” the popular television show featuring the eponymous mafia family.</p> <p>“These are Joe Percoco’s own words...begging, requesting, demanding ‘ziti,’” Zhou told the jurors.</p> <p>Zhou meticulously laid out the prosecution’s case over the course of about three hours, detailing how Percoco allegedly wielded his powerful position in the governor’s office to take favorable official actions towards two firms, COR Development and Competitive Power Ventures, in corrupt exchanges with executives from the companies. Howe, in turn, funnelled payments from the firms to Percoco and to his wife, Lisa Percoco, who received a “low-show” job from CPV paying $90,000 a year for little work. “Ladies and gentlemen, you’ve put more time into this trial than Lisa Percoco did from her $90,000-a-year job,” Zhou said.</p> <p>The prosecution’s case was complicated when, earlier this month, Howe admitted to attempted credit card fraud on the witness stand, violating his cooperation agreement with the government and leading to his arrest as the trial progressed.</p> <p>As they began their closing arguments, lawyers for the defense emphasized Tuesday that Howe is an unreliable witness who is attempting to save himself from jail time.</p> <p>The prosecution tried to preempt that argument, with Zhou telling the jury he expected the defendants to attack Howe’s credibility. “They’re hoping to distract you from the clear evidence in this case. Don’t let them,” he said, emphasizing that Howe’s testimony was only a part of their case and that a massive paper trail implicated the defendants and did not depend on Howe. “You don’t need an insider’s view to convict these defendants.They convict themselves,” he said.</p> <p>After Zhou concluded, lawyers for Percoco’s co-defendants took their turns tearing into Howe while describing their clients as unwitting victims of a “master manipulator” who has even fooled the government.</p> <p>“The government’s case is heavily leveraged on Howe,” said Milton Williams, an attorney for Gerardi, a COR Development executive. Williams said Howe’s talent with the “magic phone call game” made him an effective operator who lobbied government officials and got things done with a simple phone call.</p> <p>Howe, he said, controlled “the flow of information” between all the defendants and that Gerardi was “played for a fool” like the others. “It’s up to you to stop the damage of Todd Howe,” Williams told the jury.</p> <p>COR executive Steven Aiello’s attorney, Stephen Coffey, did not hold back as he spent two hours painting the image of Howe as the mastermind who played both sides and entrapped his client in the different schemes that make up the charges. “The only person spinning this web tangled with lies...is Howe,” he said, describing Howe as a “walking, talking reasonable doubt.”</p> <p>“If ever a man exemplified reasonable doubt, it’s Todd Howe,” he said.</p> <p>Coffey also attempted to draw a line between the charges faced by Aiello and Gerardi as opposed to those faced by Kelly and Percoco. “Anything you find went on with the Kelly matter or the Percoco matter, we’re not involved in it,” he said. “There’s no ‘ziti’ with Steven Aiello and Joe Gerardi.”</p> <p>CVP executive Peter Galbraith Kelly’s lawyer, Daniel Gitner, also addressed the jury Tuesday, portraying the relationship between his client and Percoco as a close friendship. “Braith’s actions were never the actions of a man who thought he’d rigged the system,” Gitner said, using a nickname for Kelly. “Quid pro nada,” he added.</p> <p>Instead, Gitner said Kelly was simply a generous man who wanted to help a friend in financial distress with no expectation of any favors in return. “No such agreement was discussed. No such bargain was struck,” he said, explaining the circumstances of the how Kelly’s company gave a job to Percoco’s wife.</p> <p>Gitner also accused the prosecution of attempting to “whitewash” Howe’s contribution to its case in closing statements after “touting” him in the trail’s opening remarks. Just over an hour into his closing, Gitner was barely halfway done before the court adjourned for the day. Closing arguments will continue and may conclude on Wednesday, possibly leading to initial jury deliberations the following day.</p> <p>The trial has raised a number of questions about Governor Cuomo's knowledge of Percoco's behavior and ways in which Cuomo oversaw both his reelection campaign and government administration. Cuomo has declined to answer any media questions about the trial, saying it wouldn't be appropriate given the ongoing trial and his self-professed respect for the legal process.</p> <p>

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by Samar Khurshid, City government reporter, Gotham Gazette
     

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</p>
Federal Corruption Charges Confirm Systemic Flaws in State Economic Development System 2016-09-22T04:00:00+00:00 2016-09-22T04:00:00+00:00 http://www.gothamgazette.com/?id=6544:federal-corruption-charges-confirm-systemic-flaws-in-state-economic-development-system Ben Max <p><img src="http://www.gothamgazette.com/images/graphics/2014/03/19673670634_68575a51ab_z.jpg" alt="cuomo topping off buffalo" width="600" height="392" /></p> <p>Cuomo in Buffalo (photo via The Governor's Office on Flickr)</p> <hr /> <p>After laying out multiple corruption and bribery charges against nine players involved with Gov. Andrew Cuomo&rsquo;s signature economic development program, including his former aide and close friend Joe Percoco, family friend and confidante Todd Howe, and a number of major developers and Cuomo donors, U.S. Attorney Preet Bharara refused to say whether the governor is a target in the probe or if it is reasonable to hold him accountable for the conduct of the people he empowered. The prosecutor noted the case remains open as a &ldquo;general matter.&rdquo;</p> <p>Alluding to things possibly to come, though, Bharara said, "I really do hope that there is a trial in this case, so that all New Yorkers can see, in gory detail, what their state government has been up to.&rdquo;</p> <p>Whether or not Cuomo is indeed being investigated, or will see charges, those brought by Bharara on Thursday are an indictment of a system that the governor has presided over, and one that other leaders in state government have done little to oppose.</p> <p>Cuomo issued a statement lamenting the charges and promising justice will be served: &ldquo;If the allegations are true, I am saddened and profoundly disappointed. I hold my administration to the highest level of integrity. I have zero tolerance for abuse of the public trust from anyone. If anything, a friend should be held to an even higher standard. Like my father before me, I believe public integrity is paramount. This sort of breach, if true, should be and will be punished.&rdquo;</p> <p>Cuomo and his administration have continuously responded to reports about corruption in his economic development programs as though they are surprising and have caught them off guard, but the administration has been receiving warnings for years that the system was being abused.</p> <p>Watchdogs have been setting off alarms that the state&rsquo;s economic development system is ripe for corruption, while the press has consistently reported what appeared to be instances of bid-rigging related to the Buffalo Billion and government favors for donors to Cuomo&rsquo;s electoral campaigns.</p> <p>All the while, the Cuomo administration has taken the criticism and spun it as attacks on the effectiveness of the investments and on the needy communities they benefit, especially Buffalo. And while the governor did hire an &ldquo;independent&rdquo; investigator, Bart Schwartz, to examine and oversee the system last Spring, it was only after the administration was rocked by a storm of subpoenas. Schwartz and his firm can earn up to $450,000 for their work examining the system, a job watchdogs say should have been carried out by the state Legislature, Comptroller, and Attorney General.</p> <p>Schwartz&rsquo;s office declined to comment on the charges or what his role will be going forward now that the charges have been unveiled.</p> <p>&ldquo;The real story here is the system is broken. Everything we thought was going on, was going on, and is actually worse than we thought,&rdquo; said John Kaehny, executive director of Reinvent Albany, a group that has been pushing for major reforms to the state&rsquo;s economic development systems and greater budget transparency.</p> <p>Kaehny noted that the scandals related to bid-rigging in Buffalo, Syracuse, and Albany involve over $1.5 billion in taxpayer funds. &ldquo;These indictments shine a light on a broken and corrupt system -- not a few bad apples,&rdquo; said Kaehny.</p> <p>Hundreds of millions of dollars in state funds flow through opaque non-profits that the state established, a practice that predates Gov. Cuomo but he has expanded. Large sums of cash are approved in the state budget with little debate and the money is given little scrutiny by the Legislature thereafter.</p> <p>The major beneficiary of the alleged malfeasance, besides those charged with unfairly winning contracts and those accused of taking bribes, appears to be the Cuomo campaign. Developers involved in the scandal gave generously to Cuomo around the times they won state economic development contracts.</p> <p><a href="http://reinventalbany.org/2016/09/three-indicted-ceos-are-all-among-gov-cuomos-biggest-upstate-contributors-biggest-state-econ-dev-contractors/" target="_blank">According to Reinvent Albany</a>, three of the executives now charged in bid-rigging schemes are some of Cuomo&rsquo;s biggest donors. Louis Ciminelli of LP Ciminelli has given Cuomo&rsquo;s campaign $143,550 in contributions and received over $600 million worth of contracts through state-controlled non-profits. Joe Nicolla of Columbia Development has given Cuomo $320,000 while receiving $190 million in contracts through state-controlled non-profits and Steven Aiello of COR Development has given $338,500 to the Cuomo campaign while receiving $105 million through state-controlled non-profits.</p> <p>Among those charged is Percoco, a childhood friend of Cuomo&rsquo;s who has followed the governor throughout his various political positions. Percoco was known as the governor&rsquo;s enforcer when he worked under him in the Capitol and later as a high-pressure fundraiser when he worked for Cuomo&rsquo;s campaign. He is accused of using his position to take state action on behalf of contractors in exchange for bribes.</p> <p>Alain Kaloyeros, now the former head of SUNY Polytechnic, which has awarded contracts to Buffalo Billion developers, was also charged Thursday. Kaloyeros is charged with bid-rigging.</p> <p><a href="https://www.justice.gov/usao-sdny/pr/nine-defendants-including-joseph-percoco-former-executive-deputy-secretary-governor-and" target="_blank">Also charged</a> were developers including Aiello, Ciminelli, and Joseph Gerardi.</p> <p>Bharara&rsquo;s office also unsealed a guilty plea by Todd Howe, a lobbyist and Cuomo family friend who has faced financial trouble over the years and was advocating for contractors while also overseeing and working with Kaloyeros.</p> <p>Up until very recently the system allowed the state to funnel money to two non-profit entities overseen by SUNY Polytechnic. Those entities issued requests for proposal that in several instances were written specifically to only fit developers that had donated generously to Cuomo&rsquo;s campaign. Bharara charges that Kaloyeros actually tipped his favorite contractors far in advance of issuing an RFP to give them a leg up.</p> <p>The nonprofits have resisted transparency, only recently opening board meetings to the press. Additionally, the state appears to have been extremely lax in holding recipients of economic development funds to their promises, like how many jobs they plan to deliver or how much a project will cost.</p> <p>Legislative leaders, the comptroller, and attorney general have raised little fuss about an economic development system that appeared to evade standard state contracting procedures by using a complicated system of nonprofits controlled by the State University to award bids and dole out funding.</p> <p>Even with the spectre of Bharara&rsquo;s investigation hanging overhead, the Legislature made no broad attempts to reform the system, instead mostly deferring to the Cuomo administration.</p> <p>Comptroller Tom DiNapoli&rsquo;s office raised concerns this year about its ability to audit economic development projects, but DiNapoli has a reputation as being non-confrontational. When an audit of his challenged the effectiveness and oversight of Cuomo&rsquo;s Excelsior Jobs Program, the administration hit back hard, attacking the competence of DiNapoli&rsquo;s staff. <a href="http://www.gothamgazette.com/index.php/state/6485-cuomo-seeks-to-undermine-comptroller-s-check-on-his-power" target="_blank">Cuomo said</a> DiNapoli should &ldquo;educate&rdquo; himself and called his audits of economic development's &ldquo;opinion.&rdquo; DiNapoli has said he&rsquo;s not intimidated and that he does his mandated job.</p> <p>Cuomo and the Legislature actually <a href="http://www.gothamgazette.com/index.php/state/6485-cuomo-seeks-to-undermine-comptroller-s-check-on-his-power" target="_blank">stripped DiNapoli</a> of the ability to review contracts issued by SUNY and CUNY ahead of time, part of creating a secretive system without clear checks and accountability.</p> <p>On Thursday afternoon, Attorney General Eric Schneiderman unveiled bid-rigging charges of his own, these having to do with the construction of dorms near SUNY Albany, against Kaloyeros and Nicolla, of Columbia Development. Kaloyeros has spearheaded economic development programs under Cuomo and routinely appeared by Cuomo&rsquo;s side for years.</p> <p>According to Schneiderman&rsquo;s office the investigation took a year and was performed in partnership with the probe by federal agents led by Bharara&rsquo;s office. Schneiderman accused Kaloyeros, who was the state&rsquo;s highest paid employee until being suspended without pay on Thursday, of rigging bids to go to developers who in turn directed grants and other benefits to SUNY Polytechnic. Kaloyeros&rsquo; compensation package was directly tied to the activity he oversaw at SUNY Polytechnic, therefore he benefited from the bid-rigging.</p> <p>Last year Kaloyeros contacted this reporter by Facebook messenger after reading and apparently being upset by a story about the role he played in the Buffalo Billion. When asked if he would like to set up an interview to correct any misunderstandings or inaccuracies, he replied that he would like to give a tour of the nano facilities he oversees, but any discussion of federal investigations would be off limits. "The issue we have is confidentiality. We were instructed in no uncertain terms not to comment on the inquiry from down South with the threat of jail which is being interpreted as we are the target of an investigation,&rdquo; Kaloyeros wrote. &ldquo;So that part we cannot comment on beyond what we were authorized to say publicly. The rest is not a problem.&rdquo;</p> <p><a href="http://www.gothamgazette.com/index.php/government/5925-buffalo-billion-boss-offers-cancels-interview-claims-threat-of-jail" target="_blank">The article</a> attracted attention to Kaloyeros and he later deleted his Facebook profile.</p> <p>Now with the &ldquo;gory&rdquo; details of the charges out for all to see, Reinvent Albany is calling on the state to take quick action to fix the system. It wants the state to freeze any new economic development activity by SUNY Poly and its subsidiaries; a phase out of using state-controlled non-profits to oversee economic development funds; a uniform contract process by the state, public authorities, and SUNY; new pay-to-play controls limiting contributions from those doing business with state entities; the creation of a database that reports the details of state subsidies and contracts given to businesses; and restoration of the Comptroller&rsquo;s ability to review contracts issued by all state entities before they are signed.</p> <p>Asked for a comment on Reinvent Albany's reform suggestions in light of Thursday's charges brought by Bharara, a spokesperson for Gov. Cuomo did not respond.</p> <p>Jennifer Rodgers, executive director of The Center for the Advancement of Public Integrity at Columbia Law School and a former prosecutor who served in Bharara&rsquo;s office, said that the charges give proof that the state&rsquo;s economic development system failed.</p> <p>"As shown by the allegations in the indictment, there was a clear failure here in the oversight of the bidding procedures related to these Buffalo Billion projects,&rdquo; Rodgers said in a statement. &ldquo;We need greater transparency in these processes and stronger oversight; hopefully this will prevent recurrences of a situation where public funds made their way into the defendant's' pockets instead of being used for the benefit of the people of New York."</p> <p>

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by David King, Albany editor, Gotham Gazette
     

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</p>
<p><img src="http://www.gothamgazette.com/images/graphics/2014/03/19673670634_68575a51ab_z.jpg" alt="cuomo topping off buffalo" width="600" height="392" /></p> <p>Cuomo in Buffalo (photo via The Governor's Office on Flickr)</p> <hr /> <p>After laying out multiple corruption and bribery charges against nine players involved with Gov. Andrew Cuomo&rsquo;s signature economic development program, including his former aide and close friend Joe Percoco, family friend and confidante Todd Howe, and a number of major developers and Cuomo donors, U.S. Attorney Preet Bharara refused to say whether the governor is a target in the probe or if it is reasonable to hold him accountable for the conduct of the people he empowered. The prosecutor noted the case remains open as a &ldquo;general matter.&rdquo;</p> <p>Alluding to things possibly to come, though, Bharara said, "I really do hope that there is a trial in this case, so that all New Yorkers can see, in gory detail, what their state government has been up to.&rdquo;</p> <p>Whether or not Cuomo is indeed being investigated, or will see charges, those brought by Bharara on Thursday are an indictment of a system that the governor has presided over, and one that other leaders in state government have done little to oppose.</p> <p>Cuomo issued a statement lamenting the charges and promising justice will be served: &ldquo;If the allegations are true, I am saddened and profoundly disappointed. I hold my administration to the highest level of integrity. I have zero tolerance for abuse of the public trust from anyone. If anything, a friend should be held to an even higher standard. Like my father before me, I believe public integrity is paramount. This sort of breach, if true, should be and will be punished.&rdquo;</p> <p>Cuomo and his administration have continuously responded to reports about corruption in his economic development programs as though they are surprising and have caught them off guard, but the administration has been receiving warnings for years that the system was being abused.</p> <p>Watchdogs have been setting off alarms that the state&rsquo;s economic development system is ripe for corruption, while the press has consistently reported what appeared to be instances of bid-rigging related to the Buffalo Billion and government favors for donors to Cuomo&rsquo;s electoral campaigns.</p> <p>All the while, the Cuomo administration has taken the criticism and spun it as attacks on the effectiveness of the investments and on the needy communities they benefit, especially Buffalo. And while the governor did hire an &ldquo;independent&rdquo; investigator, Bart Schwartz, to examine and oversee the system last Spring, it was only after the administration was rocked by a storm of subpoenas. Schwartz and his firm can earn up to $450,000 for their work examining the system, a job watchdogs say should have been carried out by the state Legislature, Comptroller, and Attorney General.</p> <p>Schwartz&rsquo;s office declined to comment on the charges or what his role will be going forward now that the charges have been unveiled.</p> <p>&ldquo;The real story here is the system is broken. Everything we thought was going on, was going on, and is actually worse than we thought,&rdquo; said John Kaehny, executive director of Reinvent Albany, a group that has been pushing for major reforms to the state&rsquo;s economic development systems and greater budget transparency.</p> <p>Kaehny noted that the scandals related to bid-rigging in Buffalo, Syracuse, and Albany involve over $1.5 billion in taxpayer funds. &ldquo;These indictments shine a light on a broken and corrupt system -- not a few bad apples,&rdquo; said Kaehny.</p> <p>Hundreds of millions of dollars in state funds flow through opaque non-profits that the state established, a practice that predates Gov. Cuomo but he has expanded. Large sums of cash are approved in the state budget with little debate and the money is given little scrutiny by the Legislature thereafter.</p> <p>The major beneficiary of the alleged malfeasance, besides those charged with unfairly winning contracts and those accused of taking bribes, appears to be the Cuomo campaign. Developers involved in the scandal gave generously to Cuomo around the times they won state economic development contracts.</p> <p><a href="http://reinventalbany.org/2016/09/three-indicted-ceos-are-all-among-gov-cuomos-biggest-upstate-contributors-biggest-state-econ-dev-contractors/" target="_blank">According to Reinvent Albany</a>, three of the executives now charged in bid-rigging schemes are some of Cuomo&rsquo;s biggest donors. Louis Ciminelli of LP Ciminelli has given Cuomo&rsquo;s campaign $143,550 in contributions and received over $600 million worth of contracts through state-controlled non-profits. Joe Nicolla of Columbia Development has given Cuomo $320,000 while receiving $190 million in contracts through state-controlled non-profits and Steven Aiello of COR Development has given $338,500 to the Cuomo campaign while receiving $105 million through state-controlled non-profits.</p> <p>Among those charged is Percoco, a childhood friend of Cuomo&rsquo;s who has followed the governor throughout his various political positions. Percoco was known as the governor&rsquo;s enforcer when he worked under him in the Capitol and later as a high-pressure fundraiser when he worked for Cuomo&rsquo;s campaign. He is accused of using his position to take state action on behalf of contractors in exchange for bribes.</p> <p>Alain Kaloyeros, now the former head of SUNY Polytechnic, which has awarded contracts to Buffalo Billion developers, was also charged Thursday. Kaloyeros is charged with bid-rigging.</p> <p><a href="https://www.justice.gov/usao-sdny/pr/nine-defendants-including-joseph-percoco-former-executive-deputy-secretary-governor-and" target="_blank">Also charged</a> were developers including Aiello, Ciminelli, and Joseph Gerardi.</p> <p>Bharara&rsquo;s office also unsealed a guilty plea by Todd Howe, a lobbyist and Cuomo family friend who has faced financial trouble over the years and was advocating for contractors while also overseeing and working with Kaloyeros.</p> <p>Up until very recently the system allowed the state to funnel money to two non-profit entities overseen by SUNY Polytechnic. Those entities issued requests for proposal that in several instances were written specifically to only fit developers that had donated generously to Cuomo&rsquo;s campaign. Bharara charges that Kaloyeros actually tipped his favorite contractors far in advance of issuing an RFP to give them a leg up.</p> <p>The nonprofits have resisted transparency, only recently opening board meetings to the press. Additionally, the state appears to have been extremely lax in holding recipients of economic development funds to their promises, like how many jobs they plan to deliver or how much a project will cost.</p> <p>Legislative leaders, the comptroller, and attorney general have raised little fuss about an economic development system that appeared to evade standard state contracting procedures by using a complicated system of nonprofits controlled by the State University to award bids and dole out funding.</p> <p>Even with the spectre of Bharara&rsquo;s investigation hanging overhead, the Legislature made no broad attempts to reform the system, instead mostly deferring to the Cuomo administration.</p> <p>Comptroller Tom DiNapoli&rsquo;s office raised concerns this year about its ability to audit economic development projects, but DiNapoli has a reputation as being non-confrontational. When an audit of his challenged the effectiveness and oversight of Cuomo&rsquo;s Excelsior Jobs Program, the administration hit back hard, attacking the competence of DiNapoli&rsquo;s staff. <a href="http://www.gothamgazette.com/index.php/state/6485-cuomo-seeks-to-undermine-comptroller-s-check-on-his-power" target="_blank">Cuomo said</a> DiNapoli should &ldquo;educate&rdquo; himself and called his audits of economic development's &ldquo;opinion.&rdquo; DiNapoli has said he&rsquo;s not intimidated and that he does his mandated job.</p> <p>Cuomo and the Legislature actually <a href="http://www.gothamgazette.com/index.php/state/6485-cuomo-seeks-to-undermine-comptroller-s-check-on-his-power" target="_blank">stripped DiNapoli</a> of the ability to review contracts issued by SUNY and CUNY ahead of time, part of creating a secretive system without clear checks and accountability.</p> <p>On Thursday afternoon, Attorney General Eric Schneiderman unveiled bid-rigging charges of his own, these having to do with the construction of dorms near SUNY Albany, against Kaloyeros and Nicolla, of Columbia Development. Kaloyeros has spearheaded economic development programs under Cuomo and routinely appeared by Cuomo&rsquo;s side for years.</p> <p>According to Schneiderman&rsquo;s office the investigation took a year and was performed in partnership with the probe by federal agents led by Bharara&rsquo;s office. Schneiderman accused Kaloyeros, who was the state&rsquo;s highest paid employee until being suspended without pay on Thursday, of rigging bids to go to developers who in turn directed grants and other benefits to SUNY Polytechnic. Kaloyeros&rsquo; compensation package was directly tied to the activity he oversaw at SUNY Polytechnic, therefore he benefited from the bid-rigging.</p> <p>Last year Kaloyeros contacted this reporter by Facebook messenger after reading and apparently being upset by a story about the role he played in the Buffalo Billion. When asked if he would like to set up an interview to correct any misunderstandings or inaccuracies, he replied that he would like to give a tour of the nano facilities he oversees, but any discussion of federal investigations would be off limits. "The issue we have is confidentiality. We were instructed in no uncertain terms not to comment on the inquiry from down South with the threat of jail which is being interpreted as we are the target of an investigation,&rdquo; Kaloyeros wrote. &ldquo;So that part we cannot comment on beyond what we were authorized to say publicly. The rest is not a problem.&rdquo;</p> <p><a href="http://www.gothamgazette.com/index.php/government/5925-buffalo-billion-boss-offers-cancels-interview-claims-threat-of-jail" target="_blank">The article</a> attracted attention to Kaloyeros and he later deleted his Facebook profile.</p> <p>Now with the &ldquo;gory&rdquo; details of the charges out for all to see, Reinvent Albany is calling on the state to take quick action to fix the system. It wants the state to freeze any new economic development activity by SUNY Poly and its subsidiaries; a phase out of using state-controlled non-profits to oversee economic development funds; a uniform contract process by the state, public authorities, and SUNY; new pay-to-play controls limiting contributions from those doing business with state entities; the creation of a database that reports the details of state subsidies and contracts given to businesses; and restoration of the Comptroller&rsquo;s ability to review contracts issued by all state entities before they are signed.</p> <p>Asked for a comment on Reinvent Albany's reform suggestions in light of Thursday's charges brought by Bharara, a spokesperson for Gov. Cuomo did not respond.</p> <p>Jennifer Rodgers, executive director of The Center for the Advancement of Public Integrity at Columbia Law School and a former prosecutor who served in Bharara&rsquo;s office, said that the charges give proof that the state&rsquo;s economic development system failed.</p> <p>"As shown by the allegations in the indictment, there was a clear failure here in the oversight of the bidding procedures related to these Buffalo Billion projects,&rdquo; Rodgers said in a statement. &ldquo;We need greater transparency in these processes and stronger oversight; hopefully this will prevent recurrences of a situation where public funds made their way into the defendant's' pockets instead of being used for the benefit of the people of New York."</p> <p>

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by David King, Albany editor, Gotham Gazette
     

Read more by this writer.

</p>
For Review, Cuomo Chooses Outside Agent Over Existing State Investigators 2016-06-05T04:00:00+00:00 2016-06-05T04:00:00+00:00 http://www.gothamgazette.com/?id=6377:for-review-cuomo-chooses-outside-agent-instead-of-existing-state-investigators Ben Max <p><img src="http://www.gothamgazette.com/images/9191518151_d1e1f4aa47_z.jpg" width="600" height="399" alt="schneiderman cuomo moreland corruption" /></p> <p>Scheiderman, left, &amp; Cuomo, center (photo via The Governor's Office on Flickr)</p> <hr /> <p>More than a month after Governor Andrew Cuomo <a href="http://www.gothamgazette.com/index.php/state/6363-role-of-cuomo-s-independent-investigator-remains-unclear" target="_blank">announced</a> that Bart Schwartz, a former federal prosecutor, would head an “independent investigation” into the Buffalo Billion economic development program, <a href="http://www.gothamgazette.com/index.php/state/6363-role-of-cuomo-s-independent-investigator-remains-unclear" target="_blank">it remains unclear</a> whether Schwartz has begun his work and the governor has repeatedly said that his contract with the state is still being finalized. The Buffalo Billion project and other pieces of Cuomo’s economic development programs have drawn scrutiny from the U.S. Attorney and Attorney General Eric Schneiderman due to allegations including bid-rigging that favored large Cuomo donors.</p> <p>This past week, the State Inspector General’s office <a href="http://www.newsday.com/news/new-york/state-investigation-finds-leak-in-probe-of-de-blasio-campaign-1.11861493" target="_blank">issued a report</a> on the source of a leak about an investigation into Mayor Bill de Blasio’s fundraising practices at the State Board of Elections. By all accounts the investigation was conducted expeditiously.The Joint Commission on Public Ethics is also involved in a de Blasio matter as it probes his allies’ lobbying practices. These matters, not to mention the existence of the Attorney General and Comptroller, make it clear that state government already has a number of investigative bodies that would not have required extended contract negotiations and monetary compensation to conduct an investigation of the Buffalo Billion. But, Cuomo decided not to call on an existing investigative body to look at all aspects of his major economic development programs.</p> <p>Gov. Cuomo’s office did not respond to questions about why an existing agency was not selected. Schwartz’s office declined to respond to questions about whether he had a contract and how many staff he would bring to his review of state economic development programming.</p> <p>Schwartz’s role is murky given that the U.S. Attorney and Attorney General are now both pursuing widespread investigations. It is unclear what he can do investigatively that won’t interfere with active probes. Government watchdogs say that Schwartz’s appointment would have had an impact when concerns about the bidding process were initially raised, but at this point many believe Cuomo is simply trying to obscure the scope of the federal probe and claim high ground as state integrity is questioned.</p> <p>“Schwartz’s investigation was triggered by a criminal probe. If he had been brought in years ago, that would have been a different thing,” said John Kaehny, executive director of Reinvent Albany.</p> <p>Jennifer Rodgers, a former federal prosecutor and head of Columbia Law School’s Center for the Advancement of Public Integrity sees value in Schwartz’s hiring. “There are two things Bart Schwartz brings to the table: independence and resources,” Rodgers said.</p> <p>“JCOPE is constantly tagged as not independent, and the state IG is ostensibly independent although appointed by the Governor,” noted Rodgers, adding that Schwartz’s firm, Guidepost Solutions, “has all the experts he might need to examine such a complex system: lawyers, former law enforcement officials, computer people - people with a set of skills that the IG and JCOPE would be hard-pressed to bring together.”</p> <p>While Cuomo has said Schwartz will take a soup-to-nuts approach to his review, no one will know exactly what he is tasked with and how his work will be done until his contract is finalized and made public.</p> <p>Schwartz’s firm details its approach to internal investigations <a href="http://www.guidepostsolutions.com/investigations/internal-investigations/" target="_blank">on its website</a>:</p> <p>“Guidepost Solutions is frequently called upon by businesses to conduct internal investigations into allegations or suspicions of corrupt or fraudulent conduct by employees. We rely upon our full-time staff of attorneys, forensic accountants, research analysts, field investigators and computer forensics experts to staff these assignments, and we work collaboratively with our business clients to develop an investigative plan that is appropriate to the suspected misconduct...Since most of our investigative professionals have had experience in federal, state and local law enforcement—as prosecutors, auditors and agents—our investigative strategies are developed with an understanding of the evidence that may be needed to support an eventual criminal prosecution.”</p> <p>The section goes on to state that the team is “equally sensitive to matters of confidentiality and public perception.”</p> <p>Blair Horner, legislative director of the New York Public Interest Research Group (NYPIRG), said that Gov. Cuomo had a full menu of options to choose from before even considering Schwartz. “The governor had a toolbox he could have gone to to review this, but instead he went out and bought a new hammer.” Critics of the state's approach to economic development, including the Buffalo Billion, have repeatedly said that the state Comptroller should have more oversight of contracts and spending - something Comptroller Tom DiNapoli recently addressed in a series of proposals.</p> <p>Horner said that the arrangement with Schwartz could technically allow Cuomo to address issues faster than if the IG’s office was investigating.</p> <p>“Schwartz reports directly to him, so in theory it would all happen faster, although the IG did just turn a report around in a few weeks,” said Horner, referring to the investigation of the BOE leak. “The IG would have to issue a report and the IG would have to act.”</p> <p>In other words, if the IG’s office was investigating the case the governor wouldn’t be able to fix anything until after a report was released, and the IG would have to recommend actions to be taken, which could include civil cases or referrals to law enforcement agencies for violations of the law, according to New York Executive Law <a href="http://codes.findlaw.com/ny/executive-law/exc-sect-53.html" target="_blank">section 53</a>.</p> <p>The Cuomo administration has said Schwartz will have the ability to review contracts and control cash flow, while also looking for larger fixes to the system, giving him a more proactive role than standard investigators. In an April 29 statement announcing his impending hire, Schwartz said that given the investigation and the administration’s desire to keep the Buffalo Billion program running, “they have asked me to commence an immediate review of all grants and approvals – past, current and future – in certain programs and operations,including the Buffalo Billion/Nano Economic Development Program.”</p> <p>“It’s belt and suspenders, but I’d rather have it that way,” Cuomo told reporters in New York City last week, referring to redundancy and noting that he will consider making changes to economic development programs depending on the findings. Cuomo aides have periodically reminded reporters that Schwartz will also have direct approval of contracts and cash allocations. No one has confirmed whether Schwartz has indeed begun his work.</p> <p>Last week, when asked if Schwartz’s report would be made public Cuomo appeared less sure of what Schwartz would be doing and admitted he had yet to secure a contract with him. “He is being hired as an independent to do an independent review,” said Cuomo. “I don’t know what his standard protocol is. I wouldn’t have a problem with [making his findings public], but I don’t know how he operates.”</p> <p>Cuomo’s aides later clarified Schwartz’s report would be made public if it didn’t interfere with the U.S. Attorney’s investigation. It is unclear if there has been communication between Schwartz and U.S. Attorney Bharara’s office.</p> <p>Kaehny of Reinvent Albany said he finds it a “stretch of the imagination” to think the governor could appoint someone to investigate the Buffalo Billion matter when the crux of the federal investigation appears to hinge on whether contracts were exchanged for major donations to the governor’s campaign.</p> <p>“He could have asked the Attorney General and Comptroller to jointly choose an investigator and signed an MOU [memo of understanding] that would give them access to the documents they need. It would have been highly credible, people would believe it.” He noted that “most observers don’t think of the IG or JCOPE as independent” and so wouldn’t have the ability to “give the governor a clean bill of health.”</p> <p>Rodgers said a joint investigation by Attorney General Eric Schneiderman and Comptroller Thomas DiNapoli, both Democrats like Cuomo who are known to have strained relationships with the governor, could have appeared independent but the relational friction could have prevented the governor from wanting to hand them the keys to his signature economic development program. She noted both offices would have the resources necessary for an investigation the scope of the Buffalo Billion.</p> <p>The main question surrounding Schwartz’s usefulness in the matter remains exactly what Cuomo has tasked him with investigating. Cuomo has repeatedly said that Bharara’s investigation focuses on two men, longtime associates Todd Howe and Joseph Percoco, something disputed by those familiar with the investigation.</p> <p>On Thursday Cuomo was asked whether he has been told by the U.S. Attorney’s Office that its probe focuses on only a few people. Cuomo said that he hadn’t but that he believes the actions of a few people are at issue.</p> <p>“Our investigator will talk to hundreds of people, but it’s about the actions of several people,” Cuomo <a href="http://www.nystateofpolitics.com/2016/06/cuomo-investigator-will-talk-hundreds-of-people/" target="_blank">said</a>, adding that he would consider changes to economic development practices if Schwartz’s indicates they are necessary.</p> <p>“There are major question marks around the scope of his engagement and the access he will get,” Rodgers said of Schwartz. “He has the tools and independence, but what was he asked to do with them? That is why it's so important we see a contract.”</p> <p>While Schwartz’s role has remained unclear, U.S. Attorney Preet Bharara’s investigation into alleged bid-rigging in Cuomo’s economic development initiative appears to be quickly expanding; last week the U.S. Attorney’s office and Attorney General Eric Schneiderman's office <a href="http://www.buffalonews.com/city-region/attorney-general-conducts-raid-at-suny-polytechnic-20160526" target="_blank">conducted a joint raid</a> on the headquarters of SUNY Polytechnic, the organization that oversees Buffalo Billion contracting. The raid appeared partly targeted at the office of Howe, a Cuomo ally and lobbyist, who has lobbied the administration while also representing semi-governmental entities and remaining close with key players in the Cuomo administration.</p> <p>A recent <a href="http://www.wsj.com/articles/lobbyist-had-ties-to-cuomos-office-1464830106" target="_blank">Wall Street Journal story</a> revealed emails showing that Howe, someone Cuomo himself has said is a target of the probe, had a close hand in guiding SUNY Poly head Alain Kaloyeros as well as directing conversations with the governor’s top aides about how to do so. Cuomo insisted last month that he wasn’t close friends with Howe. On Thursday he said otherwise, <a href="http://www.nystateofpolitics.com/2016/06/cuomo-irrelevant-whether-he-knows-todd-howe/" target="_blank">telling reporters</a> “I know Todd Howe. I’ve known him for many years. He worked for nano, he’s worked on a lot of these projects. But it’s also irrelevant. If anyone does anything improper, they will be punished to the fullest extent of the law, period.”</p> <p>Kaehny said that Schwartz’s appointment has in a way already failed the administration. “The problem Schwartz faced from the very first moment is that his client is the governor, and the people targeted by subpoenas are extremely close to the governor,” said Kaehny, adding that it is hard to have faith in an investigation launched by the governor himself. However, it won’t be clear exactly what kind of investigation Schwartz is undertaking until his contract is made public, if one is indeed signed.</p> <p>

***
by David King, Albany editor, Gotham Gazette
     

Read more by this writer.

</p>
<p><img src="http://www.gothamgazette.com/images/9191518151_d1e1f4aa47_z.jpg" width="600" height="399" alt="schneiderman cuomo moreland corruption" /></p> <p>Scheiderman, left, &amp; Cuomo, center (photo via The Governor's Office on Flickr)</p> <hr /> <p>More than a month after Governor Andrew Cuomo <a href="http://www.gothamgazette.com/index.php/state/6363-role-of-cuomo-s-independent-investigator-remains-unclear" target="_blank">announced</a> that Bart Schwartz, a former federal prosecutor, would head an “independent investigation” into the Buffalo Billion economic development program, <a href="http://www.gothamgazette.com/index.php/state/6363-role-of-cuomo-s-independent-investigator-remains-unclear" target="_blank">it remains unclear</a> whether Schwartz has begun his work and the governor has repeatedly said that his contract with the state is still being finalized. The Buffalo Billion project and other pieces of Cuomo’s economic development programs have drawn scrutiny from the U.S. Attorney and Attorney General Eric Schneiderman due to allegations including bid-rigging that favored large Cuomo donors.</p> <p>This past week, the State Inspector General’s office <a href="http://www.newsday.com/news/new-york/state-investigation-finds-leak-in-probe-of-de-blasio-campaign-1.11861493" target="_blank">issued a report</a> on the source of a leak about an investigation into Mayor Bill de Blasio’s fundraising practices at the State Board of Elections. By all accounts the investigation was conducted expeditiously.The Joint Commission on Public Ethics is also involved in a de Blasio matter as it probes his allies’ lobbying practices. These matters, not to mention the existence of the Attorney General and Comptroller, make it clear that state government already has a number of investigative bodies that would not have required extended contract negotiations and monetary compensation to conduct an investigation of the Buffalo Billion. But, Cuomo decided not to call on an existing investigative body to look at all aspects of his major economic development programs.</p> <p>Gov. Cuomo’s office did not respond to questions about why an existing agency was not selected. Schwartz’s office declined to respond to questions about whether he had a contract and how many staff he would bring to his review of state economic development programming.</p> <p>Schwartz’s role is murky given that the U.S. Attorney and Attorney General are now both pursuing widespread investigations. It is unclear what he can do investigatively that won’t interfere with active probes. Government watchdogs say that Schwartz’s appointment would have had an impact when concerns about the bidding process were initially raised, but at this point many believe Cuomo is simply trying to obscure the scope of the federal probe and claim high ground as state integrity is questioned.</p> <p>“Schwartz’s investigation was triggered by a criminal probe. If he had been brought in years ago, that would have been a different thing,” said John Kaehny, executive director of Reinvent Albany.</p> <p>Jennifer Rodgers, a former federal prosecutor and head of Columbia Law School’s Center for the Advancement of Public Integrity sees value in Schwartz’s hiring. “There are two things Bart Schwartz brings to the table: independence and resources,” Rodgers said.</p> <p>“JCOPE is constantly tagged as not independent, and the state IG is ostensibly independent although appointed by the Governor,” noted Rodgers, adding that Schwartz’s firm, Guidepost Solutions, “has all the experts he might need to examine such a complex system: lawyers, former law enforcement officials, computer people - people with a set of skills that the IG and JCOPE would be hard-pressed to bring together.”</p> <p>While Cuomo has said Schwartz will take a soup-to-nuts approach to his review, no one will know exactly what he is tasked with and how his work will be done until his contract is finalized and made public.</p> <p>Schwartz’s firm details its approach to internal investigations <a href="http://www.guidepostsolutions.com/investigations/internal-investigations/" target="_blank">on its website</a>:</p> <p>“Guidepost Solutions is frequently called upon by businesses to conduct internal investigations into allegations or suspicions of corrupt or fraudulent conduct by employees. We rely upon our full-time staff of attorneys, forensic accountants, research analysts, field investigators and computer forensics experts to staff these assignments, and we work collaboratively with our business clients to develop an investigative plan that is appropriate to the suspected misconduct...Since most of our investigative professionals have had experience in federal, state and local law enforcement—as prosecutors, auditors and agents—our investigative strategies are developed with an understanding of the evidence that may be needed to support an eventual criminal prosecution.”</p> <p>The section goes on to state that the team is “equally sensitive to matters of confidentiality and public perception.”</p> <p>Blair Horner, legislative director of the New York Public Interest Research Group (NYPIRG), said that Gov. Cuomo had a full menu of options to choose from before even considering Schwartz. “The governor had a toolbox he could have gone to to review this, but instead he went out and bought a new hammer.” Critics of the state's approach to economic development, including the Buffalo Billion, have repeatedly said that the state Comptroller should have more oversight of contracts and spending - something Comptroller Tom DiNapoli recently addressed in a series of proposals.</p> <p>Horner said that the arrangement with Schwartz could technically allow Cuomo to address issues faster than if the IG’s office was investigating.</p> <p>“Schwartz reports directly to him, so in theory it would all happen faster, although the IG did just turn a report around in a few weeks,” said Horner, referring to the investigation of the BOE leak. “The IG would have to issue a report and the IG would have to act.”</p> <p>In other words, if the IG’s office was investigating the case the governor wouldn’t be able to fix anything until after a report was released, and the IG would have to recommend actions to be taken, which could include civil cases or referrals to law enforcement agencies for violations of the law, according to New York Executive Law <a href="http://codes.findlaw.com/ny/executive-law/exc-sect-53.html" target="_blank">section 53</a>.</p> <p>The Cuomo administration has said Schwartz will have the ability to review contracts and control cash flow, while also looking for larger fixes to the system, giving him a more proactive role than standard investigators. In an April 29 statement announcing his impending hire, Schwartz said that given the investigation and the administration’s desire to keep the Buffalo Billion program running, “they have asked me to commence an immediate review of all grants and approvals – past, current and future – in certain programs and operations,including the Buffalo Billion/Nano Economic Development Program.”</p> <p>“It’s belt and suspenders, but I’d rather have it that way,” Cuomo told reporters in New York City last week, referring to redundancy and noting that he will consider making changes to economic development programs depending on the findings. Cuomo aides have periodically reminded reporters that Schwartz will also have direct approval of contracts and cash allocations. No one has confirmed whether Schwartz has indeed begun his work.</p> <p>Last week, when asked if Schwartz’s report would be made public Cuomo appeared less sure of what Schwartz would be doing and admitted he had yet to secure a contract with him. “He is being hired as an independent to do an independent review,” said Cuomo. “I don’t know what his standard protocol is. I wouldn’t have a problem with [making his findings public], but I don’t know how he operates.”</p> <p>Cuomo’s aides later clarified Schwartz’s report would be made public if it didn’t interfere with the U.S. Attorney’s investigation. It is unclear if there has been communication between Schwartz and U.S. Attorney Bharara’s office.</p> <p>Kaehny of Reinvent Albany said he finds it a “stretch of the imagination” to think the governor could appoint someone to investigate the Buffalo Billion matter when the crux of the federal investigation appears to hinge on whether contracts were exchanged for major donations to the governor’s campaign.</p> <p>“He could have asked the Attorney General and Comptroller to jointly choose an investigator and signed an MOU [memo of understanding] that would give them access to the documents they need. It would have been highly credible, people would believe it.” He noted that “most observers don’t think of the IG or JCOPE as independent” and so wouldn’t have the ability to “give the governor a clean bill of health.”</p> <p>Rodgers said a joint investigation by Attorney General Eric Schneiderman and Comptroller Thomas DiNapoli, both Democrats like Cuomo who are known to have strained relationships with the governor, could have appeared independent but the relational friction could have prevented the governor from wanting to hand them the keys to his signature economic development program. She noted both offices would have the resources necessary for an investigation the scope of the Buffalo Billion.</p> <p>The main question surrounding Schwartz’s usefulness in the matter remains exactly what Cuomo has tasked him with investigating. Cuomo has repeatedly said that Bharara’s investigation focuses on two men, longtime associates Todd Howe and Joseph Percoco, something disputed by those familiar with the investigation.</p> <p>On Thursday Cuomo was asked whether he has been told by the U.S. Attorney’s Office that its probe focuses on only a few people. Cuomo said that he hadn’t but that he believes the actions of a few people are at issue.</p> <p>“Our investigator will talk to hundreds of people, but it’s about the actions of several people,” Cuomo <a href="http://www.nystateofpolitics.com/2016/06/cuomo-investigator-will-talk-hundreds-of-people/" target="_blank">said</a>, adding that he would consider changes to economic development practices if Schwartz’s indicates they are necessary.</p> <p>“There are major question marks around the scope of his engagement and the access he will get,” Rodgers said of Schwartz. “He has the tools and independence, but what was he asked to do with them? That is why it's so important we see a contract.”</p> <p>While Schwartz’s role has remained unclear, U.S. Attorney Preet Bharara’s investigation into alleged bid-rigging in Cuomo’s economic development initiative appears to be quickly expanding; last week the U.S. Attorney’s office and Attorney General Eric Schneiderman's office <a href="http://www.buffalonews.com/city-region/attorney-general-conducts-raid-at-suny-polytechnic-20160526" target="_blank">conducted a joint raid</a> on the headquarters of SUNY Polytechnic, the organization that oversees Buffalo Billion contracting. The raid appeared partly targeted at the office of Howe, a Cuomo ally and lobbyist, who has lobbied the administration while also representing semi-governmental entities and remaining close with key players in the Cuomo administration.</p> <p>A recent <a href="http://www.wsj.com/articles/lobbyist-had-ties-to-cuomos-office-1464830106" target="_blank">Wall Street Journal story</a> revealed emails showing that Howe, someone Cuomo himself has said is a target of the probe, had a close hand in guiding SUNY Poly head Alain Kaloyeros as well as directing conversations with the governor’s top aides about how to do so. Cuomo insisted last month that he wasn’t close friends with Howe. On Thursday he said otherwise, <a href="http://www.nystateofpolitics.com/2016/06/cuomo-irrelevant-whether-he-knows-todd-howe/" target="_blank">telling reporters</a> “I know Todd Howe. I’ve known him for many years. He worked for nano, he’s worked on a lot of these projects. But it’s also irrelevant. If anyone does anything improper, they will be punished to the fullest extent of the law, period.”</p> <p>Kaehny said that Schwartz’s appointment has in a way already failed the administration. “The problem Schwartz faced from the very first moment is that his client is the governor, and the people targeted by subpoenas are extremely close to the governor,” said Kaehny, adding that it is hard to have faith in an investigation launched by the governor himself. However, it won’t be clear exactly what kind of investigation Schwartz is undertaking until his contract is made public, if one is indeed signed.</p> <p>

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by David King, Albany editor, Gotham Gazette
     

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