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Cuomo associates charged with bribery and fraud

SUNY Polytechnic President Alain Kaloyeros

A former Cuomo administration official is among eight individuals named in a criminal complaint by U.S. Attorney Preet Bharara, and accused of carrying out kickback and bribery schemes over a period of several years. Many of those illegal acts, the complaint alleges, involve the governor’s much touted upstate economic development programs, including the Buffalo Billion.

The 80-page complaint names Joe Percoco, until recently a top aid to the governor, and the head of the State University of New York’s Polytechnic Institute, Alain Kaloyeros, who is also the highest paid official in the state.

The U.S. attorney says Percoco and his wife, who was hired as a “low-show” consultant to a Hudson Valley power plant project, illegally “pocketed” $322,000 in four years.

“One of the most powerful people in all of New York was on the take,” Bharara said at a news conference in lower Manhattan.

Percoco was Gov. Andrew Cuomo’s right hand man, and was even referred by the governor’s father, the late former Gov. Mario Cuomo as his “third son.” Percoco was known in state government as Andrew Cuomo’s “enforcer.” Most believed that when Percoco spoke, often admonishing those who disagreed with Cuomo, that he spoke for the governor.

Kaloyeros masterminded much of Cuomo’s vast upstate economic development programs. Bharara alleges that Kaloyeros, along with lobbyist Todd Howe, gamed the bidding system, in some cases even allowing key developers who made large campaign donations to Cuomo to actually write the bids to tailor them to their own needs.

“Behind the scenes they were cynically rigging the whole process, said Bharara. “So that the contracts would go to the handpicked ‘friends’ of the administration, ‘friends’ being a euphemism for large donors.”

Todd Howe made money on both sides -- working both for the nonprofit associated with the state to facilitate the contracts and also accepting money from the developers. Bharara announced that Howe pleaded guilty to an eight-count indictment, and is now a cooperating witness in the case.

Credit Tom Magnarelli / WRVO News
COR Development executives Steven Aiello and Joseph Girardi after appearing in federal court in Syracuse Thursday.

Two major upstate developers have also been charged in the complaint, Syracuse-based COR development, and it’s officers, and Buffalo-based real estate developer Louis Ciminelli. Two executives at COR Development -- Steven Aiello and Joseph Girardi -- were among those charged by they U.S. attorney. Aiello and Girardi appeared in federal court in Syracuse Thursday.

The complaint reads in part like an episode of the Sopranos. It alleges that Percoco actually took inspiration from the TV show about organized crime, choosing to use the word “ziti” as a code word when demanding bribe payments and, according to the complaint, saying at times, “keep the ziti flowing,” and “don’t tip over the ziti wagon.”

Cuomo issued a statement shortly after the complaint was makde public, saying in part he is “saddened and profoundly disappointed,” and that he has “zero tolerance for abuse of the public trust,” saying if anything, a friend should be held to an even higher standard. Cuomo has distanced himself from Percoco and Howe since the spring, when word of the federal probe got out.

“If anyone did anything wrong I will be the first to throw the book at them,” Cuomo said on May 10.

Cuomo was not named in the complaint, but is known to be a hands-on manager. Bharara was asked by a reporter whether, based on his investigations so far, he could give Cuomo a “clean bill of health.”

“There are no allegations of any wrongdoing or misconduct by the governor anywhere in this complaint,” Bharara said. “That’s all I’m going to say.”

The criminal charges against Cuomo’s associates and former top aide come as both former leaders of the state legislature face lengthy prison terms over corruption convictions.

It also comes as New York State Attorney General Eric Schneiderman is charging SUNY Poly’s Kaloyeros and another SUNY Poly board member with felony bid rigging in connection with several public development projects. 

Cuomo announced that Kaloyeros has been immediately suspended from his job, without pay.

Karen DeWitt is Capitol Bureau Chief for New York State Public Radio, a network of 10 public radio stations in New York State. She has covered state government and politics for the network since 1990.