Bruno indicted
Charges accuse ex-state Senate majority leader of trading power for $3.2M, concealing his deals
By BRENDAN J. LYONS AND JAMES M. ODATO, Staff writers, timesunion.com
First published: Saturday, January 24, 2009
LINK

ALBANY — A federal grand jury indicted former state Senate Majority Leader Joseph L. Bruno on felony charges Friday, alleging he used his elected position to extract $3.2 million in private consulting fees from clients who sought to use his influence.

A defiant Bruno, who is the sole person charged in the 8-count indictment, criticized the U.S. Attorney's office and an 'overzealous' FBI for conducting what Bruno characterized as a 'politicized' criminal investigation of his business dealings. During a brief news conference following his appearance in front of a federal magistrate, Bruno vowed to go to trial to fight the charges as he accused federal authorities of conducting 'a three-year fishing expedition that . . . stinks.'

If convicted on any of the charges, the 79-year-old Brunswick Republican faces a maximum sentence of 20 years in prison, although under federal sentencing guidelines he would likely face much less time behind bars.

Whatever comes of Bruno's criminal case, his indictment lays bare more than a decade of instances where Bruno, while occupying the state's powerful position of Senate majority leader, concealed one after another payments steered to him personally by people and organizations seeking an advantage in state politics. The indictment claims that from 1993 through 2005, all of Bruno's annual financial disclosures, required by the state's Ethics in Government law, contain false, misleading and incomplete information.

During most of those years, as Senate majority leader, Bruno controlled the ethics committee with sole power to police his own ethics.

A gauntlet of federal law enforcement officials from the Department of Justice, Internal Revenue Service and the Department of Labor explained their work following Bruno's brief court appearance, saying they joined forces three years ago and unearthed a series of questionable deals dating back 15 years in which the former senator enriched himself at the expense of state taxpayers.

Acting U.S. Attorney Andrew T. Baxter and FBI Special Agent-in-charge John Pikus said New York's 'byzantine' legislative structure made the investigation difficult because so many political decisions, including bills and spending measures, are made behind closed doors.

The indictment outlines a series of deals and business arrangements dating back to 1993 in which Bruno made money from companies or individuals who had an interest in state government, or profited as a 'consultant' for steering labor unions, which rely heavily on state government contracts, to invest in companies that were paying Bruno hundreds of thousands of dollars. The charges also delve into Bruno's penchant for race horses and several shadowy financial deals tied to the thoroughbred industry.

But it was Bruno's relationship with a Connecticut investment firm and his efforts to steer New York labor union leaders to invest their pension funds there that brought him the most private wealth, more than $2 million, according to the charges.

'While New York state legislators are part-time officials and permitted to pursue employment or business activities, the indictment alleges Bruno improperly exploited his official position and concealed conflicts of interest, contrary to state ethics and reporting laws, with respect to his private 'consulting' business,' Baxter said.

Pikus pledged his office would continue to investigate other allegations of wrongdoing in state government.

Bruno, dressed in a blue pin-striped suit, walked into a packed courtroom on the fourth floor of the James T. Foley federal courthouse and introduced himself to the lead prosecutors on his case, Elizabeth Coombe and William Pericak, shaking their hands and exchanging brief pleasantries. He then sat at a defendants table and pleaded not guilty through his attorney, William Dreyer. U.S. Magistrate Judge David R. Homer released Bruno on his own recognizance. Bruno, who reigned for years as one of the most powerful lawmakers in New York, is charged with using his office to deprive the public of the honest services of government.

The indictment marks the culmination of a three-year FBI investigation into the shadowy public and private dealings of a storied politician who emerged from a childhood of poverty to become arguably the Capital Region's most iconic political leader.

Bruno retired from his state Senate seat in July after 32 years in legislative service. He is now a lobbyist and chief executive of his close friend Kay Stafford's Latham company, CMA Consulting.

The indictment lays out Bruno's alleged deceptions, such as not disclosing his dealings to ethics authorities. It describes "schemes" involving use of his public office to convince labor unions to steer their money management to Wright Investors Service, a Connecticut firm that paid him nearly $1.4 million from 1994 to 2006, and McGinn, Smith & Co., an Albany investment firm that paid Bruno $632,116 from 1993 to 2005. The firms ended up receiving investment advisory fees or brokerage fees paid by the union benefit funds.

"Bruno did not perform legitimate consulting services commensurate with the substantial consulting fees which were in essence gifts," Baxter said.

Pikus said the case was complicated because of the veil of secrecy over a state government that makes it nearly impossible, even for the FBI, to trace the origin of legislative decisions.

The accusations against the man who was the top Republican in the state include his use of state employees to perform various duties in his outside business dealings.

Senate Republican Leader Dean Skelos said Bruno's faced many tough challenges and he will successfully confront this indictment.

Senate Majority Leader Malcolm Smith, D-Queens, called Bruno a friend adding "these are serious charges that deserve attention by the appropriate authorities, but now New York needs to move forward and meet the needs of its people."

People named in the indictment were Bruno's friends Leonard J. Fassler, Jared E. Abbruzzese and Russell C. Ball who paid Bruno hundreds of thousands of dollars for alleged consulting services, even though Bruno provided virtually no consulting, the charges allege. Federal prosecutors said no one named in the indictment, except Bruno, violated any federal laws, although the actions of his associates are cast as unflattering.

In one case, Abbruzzese paid Bruno $80,000 for a nearly worthless horse raised by Bruno at his thoroughbred breeding farm and home in Brunswick.

The investigation had dogged Bruno during the last two years of his political career as information surfaced publicly about the FBI's deep foray into his real-estate dealings, investments, political decisions and his ownership and breeding of thoroughbred horses.

The 'honest services' provision of federal statutes has been used repeatedly by federal prosecutors to take down some of the nation's corrupt government officials and lobbyists. The broadly written law, which was inserted into federal statutes 20 years ago by Congress, prohibits public officials from using the mail or interstate communications to deprive the public of an inherent "right to honest services." Democratic Assemblyman Anthony Seminerio of Queens is awaiting trial under a similar indictment.

The law has become a favored weapon of many prosecutors because it does not require a quid pro quo, which is often difficult to prove in the world of pay-to-play politics where multimillion-dollar deals and campaign fund payoffs are known to be arranged with winks and nods.

Bruno maintained that the federal prosecutors invented a crime to stick on him while letting former Gov. Eliot Spitzer off the hook for what Bruno called admitted felonies. The former Democratic governor, a foe of Bruno, resigned in 2008 after he was identified as a patron of an expensive call-girl service.

"This is not the first time we have seen deeply flawed, dysfunctional or even illegal behavior by those with prosecutorial power," Bruno said. He said he looks forward to a public trial.

The investigation began three years ago, when FBI agents from a white-collar crime unit in Albany began examining a series of private jet flights provided to Bruno by people with whom he did business both politically and privately, a source close to the case said.

The chartered jet flights, in some cases worth thousands of dollars per hour, ferried Bruno to private vacations in South Florida, political fundraisers, government functions and at least once to Kentucky horse country.

The FBI's interest in the flights was triggered, in part, by a related inquiry by the state's now-defunct lobbying commission, according to a source familiar with the investigation, and focused on Abbruzzese, a Loundonville businessman, race horse enthusiast and jet owner.

The FBI's examination quickly expanded and agents began sifting through bank records related to a private consulting firm Bruno ran from his Brunswick home. The hundreds of thousands of dollars that Bruno was paid through that firm serve as the foundation of many of the counts listed in the indictment.

Bruno abruptly resigned from that firm, Wright Investors Service of Milford, Conn., last year. He has repeatedly declined to disclose how much he was paid as its employee and has refused to identify his personal consulting clients.

Five months ago, Bruno resigned from the Senate seat he held since 1976. To many, he left a legacy as an iconic Capital Region politician who rose from an impoverished childhood to become one of the three most powerful elected officials in state government.

But he had developed a taste for fine things nice cars, jet travel and expensive suits.

Brendan J. Lyons can be reached at 454-5547 or by e-mail at blyons@timesunion.com; James M. Odato can be reached at 454-5083 or at jodato@timesunion.com.

Charges in the indictment

Count 1: Bruno received $1.37 million from Wright Investors Service of Milford, Conn., and $632,116 from McGinn, Smith & Co., an Albany brokerage firm, as a 'consultant.' His compensation centered around steering state labor union leaders to invest pension funds through the companies. Bruno concealed details of his work as required by state law.

Count 2: During a 2004 meeting at his capital office, Bruno introduced lobbyists and various state agency officials to representatives of Asentinel, a Tennessee telephone-bill management company that paid Bruno undisclosed sums for accounts he referred.

Count 3: Companies controlled by Leonard J. Fassler paid Bruno $468,000 as a 'consultant' for work that was not performed. Bruno formed 'Capital Business Consultants' to conceal his interest in Microknowledge, a Fassler-backed company which had contracts with the state.

Counts 4 and 5: Bruno received $360,000 in 'gifts' from companies controlled by Jared E. Abbruzzese through payments made to Bruno's home consulting business. Bruno 'did not perform legitimate work' and Abbruzzese had an interest in Bruno's legislative activities.

Count 6: Bruno's consulting agreement with TerreStar Networks, a company involving Abbruzzese, terminated his contract four months early, costing Bruno $80,000. To make it up, another Abbruzzese company paid Bruno's Mountain View Farm $40,000 and a $40,000 debt forgiveness for a 'worthless' horse.

Count 7: From March 2004 through May 2005 Bruno was paid $270,000 through a consulting agreement with Roadway Contracting, Inc., a company connected to Russell C. Ball, whose companies had an interest in state legislative matters. Bruno 'did not perform legitimate work.'

Count 8: Bruno failed to disclose his participation through Mountain View Farm in a partnership with Abbruzzese involving thoroughbred race horses.

Bruno is charged with scheming to defraud the state and its citizens of the right to his honest services by soliciting money from people and businesses with an interest in state government.

Bruno indictment: A little odd (Updated)

Joe Bruno, in a news conference, denounced his indictment, blamed it partly on Eliot Spitzer, complained that the ex-governor never got prosecuted for his prostitution escapade, and said he was a fighter who would beat the rap. You can read about it at Capitol Confidential.

Among other things, Bruno said: “After being hounded for three years. I am being indicted on a prosecutor’s slight of hand. Because after years of effort, they cannot find one example of criminal activity or illegal intent.”

What does he mean? Probably this:

The indictment charges that Bruno collected $3.1 million in various consulting fees from businesses with interests before the legislature and various referral fees for soliciting business from entities with interests before the legislature.

It says those various entities knew that Bruno had the ability to influence things for them, and documents various steps Bruno allegedly took to mislead voters or keep them from knowing about the nexus between his private interests and public responsibilities.

But, as far as we can see, it never cites a single piece of legislation that he allegedly influenced on behalf of the people who were paying him, or a specific legislative act he took on their behalf. It does have a couple of boilerplate paragraphs (in a 35-page indictment) that make the generic assertion -- but no specifics.

That's not necessarily a legal flaw. The charge that he deprived voters of "honest services" is an enormously flexible vehicle under federal law, the allegations of deception may be enough, and the whole thing is deeply seamy -- Bruno gets hired by a private company to drum up business and calls together everyone under his legislative thumb to hear a presentation from the company that hired him. It all smells to high heaven.

But it's still a little strange to see a public corruption indictment and be unable to cite any particular thing that he corrupted. And it's not just that it doesn't allege a quid pro quo -- it doesn't allege even an act that abstractly benefited his patrons.

In a part-time legislature where everyone has outside income, and everyone knows that the legislative status is a selling point -- Is Sheldon Silver, after all, a partner at a personal injury law firm exclusively because he's such a great litigator? -- the absence of that kind of allegation makes the line a little murky.

That's what Bruno seems to be complaining about.

Update: The Feds' version is here.

Bruno indicted
Charges accuse ex-state Senate majority leader of trading power for $3.2M, concealing his deals
By BRENDAN J. LYONS AND JAMES M. ODATO, Staff writers, Timesunion.com
First published: Saturday, January 24, 2009
LINK

ALBANY — A federal grand jury indicted former state Senate Majority Leader Joseph L. Bruno on felony charges Friday, alleging he used his elected position to extract $3.2 million in private consulting fees from clients who sought to use his influence.

A defiant Bruno, who is the sole person charged in the 8-count indictment, criticized the U.S. Attorney's office and an 'overzealous' FBI for conducting what Bruno characterized as a 'politicized' criminal investigation of his business dealings. During a brief news conference following his appearance in front of a federal magistrate, Bruno vowed to go to trial to fight the charges as he accused federal authorities of conducting 'a three-year fishing expedition that . . . stinks.'

If convicted on any of the charges, the 79-year-old Brunswick Republican faces a maximum sentence of 20 years in prison, although under federal sentencing guidelines he would likely face much less time behind bars.

Whatever comes of Bruno's criminal case, his indictment lays bare more than a decade of instances where Bruno, while occupying the state's powerful position of Senate majority leader, concealed one after another payments steered to him personally by people and organizations seeking an advantage in state politics. The indictment claims that from 1993 through 2005, all of Bruno's annual financial disclosures, required by the state's Ethics in Government law, contain false, misleading and incomplete information.

During most of those years, as Senate majority leader, Bruno controlled the ethics committee with sole power to police his own ethics.

A gauntlet of federal law enforcement officials from the Department of Justice, Internal Revenue Service and the Department of Labor explained their work following Bruno's brief court appearance, saying they joined forces three years ago and unearthed a series of questionable deals dating back 15 years in which the former senator enriched himself at the expense of state taxpayers.

Acting U.S. Attorney Andrew T. Baxter and FBI Special Agent-in-charge John Pikus said New York's 'byzantine' legislative structure made the investigation difficult because so many political decisions, including bills and spending measures, are made behind closed doors.

The indictment outlines a series of deals and business arrangements dating back to 1993 in which Bruno made money from companies or individuals who had an interest in state government, or profited as a 'consultant' for steering labor unions, which rely heavily on state government contracts, to invest in companies that were paying Bruno hundreds of thousands of dollars. The charges also delve into Bruno's penchant for race horses and several shadowy financial deals tied to the thoroughbred industry.

But it was Bruno's relationship with a Connecticut investment firm and his efforts to steer New York labor union leaders to invest their pension funds there that brought him the most private wealth, more than $2 million, according to the charges.

'While New York state legislators are part-time officials and permitted to pursue employment or business activities, the indictment alleges Bruno improperly exploited his official position and concealed conflicts of interest, contrary to state ethics and reporting laws, with respect to his private 'consulting' business,' Baxter said.

Pikus pledged his office would continue to investigate other allegations of wrongdoing in state government.

Bruno, dressed in a blue pin-striped suit, walked into a packed courtroom on the fourth floor of the James T. Foley federal courthouse and introduced himself to the lead prosecutors on his case, Elizabeth Coombe and William Pericak, shaking their hands and exchanging brief pleasantries. He then sat at a defendants table and pleaded not guilty through his attorney, William Dreyer. U.S. Magistrate Judge David R. Homer released Bruno on his own recognizance. Bruno, who reigned for years as one of the most powerful lawmakers in New York, is charged with using his office to deprive the public of the honest services of government.

The indictment marks the culmination of a three-year FBI investigation into the shadowy public and private dealings of a storied politician who emerged from a childhood of poverty to become arguably the Capital Region's most iconic political leader.

Bruno retired from his state Senate seat in July after 32 years in legislative service. He is now a lobbyist and chief executive of his close friend Kay Stafford's Latham company, CMA Consulting.

The indictment lays out Bruno's alleged deceptions, such as not disclosing his dealings to ethics authorities. It describes "schemes" involving use of his public office to convince labor unions to steer their money management to Wright Investors Service, a Connecticut firm that paid him nearly $1.4 million from 1994 to 2006, and McGinn, Smith & Co., an Albany investment firm that paid Bruno $632,116 from 1993 to 2005. The firms ended up receiving investment advisory fees or brokerage fees paid by the union benefit funds.

"Bruno did not perform legitimate consulting services commensurate with the substantial consulting fees which were in essence gifts," Baxter said.

Pikus said the case was complicated because of the veil of secrecy over a state government that makes it nearly impossible, even for the FBI, to trace the origin of legislative decisions.

The accusations against the man who was the top Republican in the state include his use of state employees to perform various duties in his outside business dealings.

Senate Republican Leader Dean Skelos said Bruno's faced many tough challenges and he will successfully confront this indictment.

Senate Majority Leader Malcolm Smith, D-Queens, called Bruno a friend adding "these are serious charges that deserve attention by the appropriate authorities, but now New York needs to move forward and meet the needs of its people."

People named in the indictment were Bruno's friends Leonard J. Fassler, Jared E. Abbruzzese and Russell C. Ball who paid Bruno hundreds of thousands of dollars for alleged consulting services, even though Bruno provided virtually no consulting, the charges allege. Federal prosecutors said no one named in the indictment, except Bruno, violated any federal laws, although the actions of his associates are cast as unflattering.

In one case, Abbruzzese paid Bruno $80,000 for a nearly worthless horse raised by Bruno at his thoroughbred breeding farm and home in Brunswick.

The investigation had dogged Bruno during the last two years of his political career as information surfaced publicly about the FBI's deep foray into his real-estate dealings, investments, political decisions and his ownership and breeding of thoroughbred horses.

The 'honest services' provision of federal statutes has been used repeatedly by federal prosecutors to take down some of the nation's corrupt government officials and lobbyists. The broadly written law, which was inserted into federal statutes 20 years ago by Congress, prohibits public officials from using the mail or interstate communications to deprive the public of an inherent "right to honest services." Democratic Assemblyman Anthony Seminerio of Queens is awaiting trial under a similar indictment.

The law has become a favored weapon of many prosecutors because it does not require a quid pro quo, which is often difficult to prove in the world of pay-to-play politics where multimillion-dollar deals and campaign fund payoffs are known to be arranged with winks and nods.

Bruno maintained that the federal prosecutors invented a crime to stick on him while letting former Gov. Eliot Spitzer off the hook for what Bruno called admitted felonies. The former Democratic governor, a foe of Bruno, resigned in 2008 after he was identified as a patron of an expensive call-girl service.

"This is not the first time we have seen deeply flawed, dysfunctional or even illegal behavior by those with prosecutorial power," Bruno said. He said he looks forward to a public trial.

The investigation began three years ago, when FBI agents from a white-collar crime unit in Albany began examining a series of private jet flights provided to Bruno by people with whom he did business both politically and privately, a source close to the case said.

The chartered jet flights, in some cases worth thousands of dollars per hour, ferried Bruno to private vacations in South Florida, political fundraisers, government functions and at least once to Kentucky horse country.

The FBI's interest in the flights was triggered, in part, by a related inquiry by the state's now-defunct lobbying commission, according to a source familiar with the investigation, and focused on Abbruzzese, a Loundonville businessman, race horse enthusiast and jet owner.

The FBI's examination quickly expanded and agents began sifting through bank records related to a private consulting firm Bruno ran from his Brunswick home. The hundreds of thousands of dollars that Bruno was paid through that firm serve as the foundation of many of the counts listed in the indictment.

Bruno abruptly resigned from that firm, Wright Investors Service of Milford, Conn., last year. He has repeatedly declined to disclose how much he was paid as its employee and has refused to identify his personal consulting clients.

Five months ago, Bruno resigned from the Senate seat he held since 1976. To many, he left a legacy as an iconic Capital Region politician who rose from an impoverished childhood to become one of the three most powerful elected officials in state government.

But he had developed a taste for fine things nice cars, jet travel and expensive suits.

Brendan J. Lyons can be reached at 454-5547 or by e-mail at blyons@timesunion.com; James M. Odato can be reached at 454-5083 or at jodato@timesunion.com.

Charges in the indictment

Count 1: Bruno received $1.37 million from Wright Investors Service of Milford, Conn., and $632,116 from McGinn, Smith & Co., an Albany brokerage firm, as a 'consultant.' His compensation centered around steering state labor union leaders to invest pension funds through the companies. Bruno concealed details of his work as required by state law.

Count 2: During a 2004 meeting at his capital office, Bruno introduced lobbyists and various state agency officials to representatives of Asentinel, a Tennessee telephone-bill management company that paid Bruno undisclosed sums for accounts he referred.

Count 3: Companies controlled by Leonard J. Fassler paid Bruno $468,000 as a 'consultant' for work that was not performed. Bruno formed 'Capital Business Consultants' to conceal his interest in Microknowledge, a Fassler-backed company which had contracts with the state.

Counts 4 and 5: Bruno received $360,000 in 'gifts' from companies controlled by Jared E. Abbruzzese through payments made to Bruno's home consulting business. Bruno 'did not perform legitimate work' and Abbruzzese had an interest in Bruno's legislative activities.

Count 6: Bruno's consulting agreement with TerreStar Networks, a company involving Abbruzzese, terminated his contract four months early, costing Bruno $80,000. To make it up, another Abbruzzese company paid Bruno's Mountain View Farm $40,000 and a $40,000 debt forgiveness for a 'worthless' horse.

Count 7: From March 2004 through May 2005 Bruno was paid $270,000 through a consulting agreement with Roadway Contracting, Inc., a company connected to Russell C. Ball, whose companies had an interest in state legislative matters. Bruno 'did not perform legitimate work.'

Count 8: Bruno failed to disclose his participation through Mountain View Farm in a partnership with Abbruzzese involving thoroughbred race horses.

Bruno is charged with scheming to defraud the state and its citizens of the right to his honest services by soliciting money from people and businesses with an interest in state government.

? Read the 35-page federal indictment on timesunion.com

January 23, 2009
Bruno Faces Mail and Wire Fraud Charges
LINK

The former Senate Majority Leader for New York, Joseph L. Bruno, was charged with mail and wire fraud in an eight count Indictment. Findlaw has the Indictment here. The Indictment includes alleged violations of mail fraud as defined under section 1346, the honest services statute. This statute was added to the fraud statutes following a Supreme Court decision in United States v. McNally, that held that "money or property" was a requirement for a mail fraud charge. The legislature immediately responded with a statute that allowed for prosecutions premised upon the "intangible right to honest services."

One interesting aspect of this Indictment is that the honest services allegation is premised in part on the New York Public Officer's Code of Ethics. It includes reference to written advisory opinions of the Legislative Ethics Committee. The alleged scheme or artifice to defraud as claimed in the Indictment was that he "would contact persons or entities who had business before the Legislature or State agencies, including union officials, exploiting his official position for personal compensation and enrichment, knowing and believing that his reasonably perceived ability to influence official action would, at last in part, motivate those he contacted to enter into financial relationships beneficial to his personal financial interest."

Several issues are likely to arise here, although some of these have rulings in prior cases. Is the honest services provision vague, should violation of a state ethics provision be sufficient to prosecute for a federal crime, and should federal courts be handling alleged state corruption charges? Again, many of these issues are not new, but prior to McNally there were many cases that allowed prosecutions based on intangible rights. One never knows when government will be found to have overstepped its boundaries in its use of the mail and wire fraud statutes.

(esp)(w/ a thanks to Peter Henning for sending the Indictment)

January 24, 2009
Ex-Senate Leader Bruno Is Indicted for Corruption
By MIKE McINTIRE and JEREMY W. PETERS, NY TIMES

Joseph L. Bruno, the former State Senate majority leader, was indicted on Friday on charges that he reaped millions of dollars from companies seeking business from the state or from labor unions, capping a long-running investigation into one of New York’s most powerful political figures.

In an eight-count indictment, federal prosecutors accused Mr. Bruno of collecting more than $3 million over a 13-year period, beginning in 1993, from a handful of companies seeking contracts and grants with the state, as well as contracts to manage pension fund investments for at least 16 labor unions. In addition to receiving cash payments disguised as consulting fees, he also had undisclosed interests in a race horse partnership and in a computer software firm that had contracts with state agencies, according to the indictment.

Prosecutors said Mr. Bruno used his position in the Senate to take “official action on legislative, funding, contract and regulatory issues” benefiting those who were paying him, although the prosecutors did not cite any specific examples.

Mr. Bruno, 79, was charged under an anti-corruption law making it a crime to deprive citizens of honest services from their elected officials. He faces a maximum sentence of 20 years in prison if convicted.

It was an inglorious turn for a politician who had fashioned himself as a champion of ordinary taxpayers and was for 14 years one of the three most powerful men in state government, able to foil governors, kill legislation, influence state contracts, direct state grants and open doors for lobbyists.

In a news conference, Andrew T. Baxter, the acting United States attorney for the Northern District of New York, said the payments to Mr. Bruno were in essence gifts because Mr. Bruno “did not perform legitimate consulting service commensurate with these substantial consulting fees.”

“Mr. Bruno exploited his office by concealing the nature and the source of substantial payments that he received from parties that benefited from his official actions,” he said.

Mr. Baxter made his comments at the federal courthouse in Albany, where about an hour earlier a defiant Mr. Bruno entered a not guilty plea and was released without bail. The former senator then addressed reporters at the Crowne Plaza Hotel nearby, angrily criticizing the indictment as “an expensive fishing expedition” that contorted federal statutes and invented crimes.

“After being hounded for three years, I am being indicted on a prosecutor’s sleight of hand,” Mr. Bruno, a former boxer, said, his voice growing louder. “I’ve been a fighter. And I don’t plan on changing now.”

Mr. Bruno, who represented the Albany area, retired last year after 14 years as majority leader, spending his final year as the de facto leader of the state’s Republican Party after Gov. George E. Pataki left office. An outgoing and gregarious political insider, he remains a friend of Gov. David A. Paterson and has close relationships with a number of political figures, though he clashed frequently with Eliot Spitzer, the former governor.

The three-year investigation, which became public in December 2006, has spanned a range of subjects, including Mr. Bruno’s overlapping business and political ties to longtime friends, his purchases of real estate and thoroughbreds, and his relationship with a Connecticut investment company that was seeking to increase its pension business among New York labor unions. Along the way, federal grand jury subpoenas were issued to business executives, Senate staff members, thoroughbred owners, labor leaders and lobbyists.

The indictment portrayed Mr. Bruno as determined to cash in on his status as one of Albany’s triumvirate of powerful men, the others being the Assembly speaker and governor. It said he formed a consulting business in the early 1990s to receive what were essentially contingency fees from companies seeking introductions to clients or state contracts. Mr. Bruno often inaccurately described these dealings on his annual financial disclosures, or omitted them entirely, the indictment said.

His largest source of money was Wright Investors’ Service, a Connecticut firm that paid him $1.37 million from 1994 to 2006 to solicit New York labor unions to hire Wright as an investment adviser for their benefits funds. Prosecutors said Mr. Bruno “falsely led Wright employees and certain union officials” to believe his dealings had been cleared by state ethics officials, when in fact he had never disclosed them.

In a statement, Wright said Friday, “If Mr. Bruno engaged in illegal activities, Wright was not aware of them.”

“Just as it is lawful for New York state legislators to maintain employment outside the Legislature, so too is it lawful to hire those individuals,” the statement said. “Wright has done nothing wrong.”

Mr. Bruno is also accused of accepting $1.82 million from an array of companies controlled by several businessmen, including $440,000 from Jared E. Abbruzzese, a race horse enthusiast with whom Mr. Bruno is said to have shared an undisclosed ownership interest in thoroughbreds. In one instance cited in the indictment, Mr. Abbruzzese funneled $80,000 to Mr. Bruno by purchasing a “virtually worthless” horse from the senator, according to prosecutors.

As senator, Mr. Bruno directed $500,000 in state money to an upstate company, Evident Technologies, in which Mr. Abbruzzese was a major investor. Mr. Abbruzzese could not be reached for comment.

Another businessman, Leonard J. Fassler, who paid Mr. Bruno $483,000, was involved in several companies that had state contracts, including one, Microknowledge, in which Mr. Bruno also held an undisclosed ownership interest, according to the indictment. Mr. Fassler declined to comment when reached on his cellphone Friday.

The head of another company named in the indictment expressed anger on Friday that his offer of payment to Mr. Bruno to drum up clients was being portrayed as criminal.

The indictment said Mr. Bruno was host at a meeting in his Senate office in 2004 for a Tennessee company, Asentinel, to pitch its billing-management services to representatives of state agencies and the State University of New York. Mr. Bruno “failed to disclose that he had a financial interest in business Asentinel obtained as a result of his introduction,” it said.

Asentinel’s chief executive, David C. Perdue, said he never paid anything to Mr. Bruno, whom he called an old friend. He acknowledged offering to “pay him for the time he put in” arranging for the introductions to potential clients, but that ultimately nothing came of it.

“How can a guy introduce you to somebody, with the idea being if they like the product, they buy it, if they don’t, they don’t buy it, and that’s somehow improper?” Mr. Perdue said in an interview. “I don’t see anything wrong with that, do you?”

In interviews over the past few years, Mr. Bruno made similar arguments, saying that whatever services he provided to his clients — whom he would never identify — was above-board and legitimate. He has repeatedly said that he had a right to earn income beyond his salary as majority leader, which was about $121,000 when he retired.

“There is a frightening message to all elected officials who are not wealthy and who have to work to make a living,” Mr. Bruno said Friday. “You, too, can become target practice with a statute that can infer, insinuate and imply because they can’t find the facts to make a criminal case.”

As he left the hotel flanked by his lawyers and a public relations specialist, Mr. Bruno stopped momentarily to acknowledge the gaggle of reporters following him, and then rode away.

Danny Hakim contributed reporting.

Joseph L. Bruno - Former New York State Senate majority leader indicted for stealing millions!
2009-01-23 19:55:37 (GMT) (JusticeNewsFlash.com - Featured, Headline, Justice News Flash)
JusticeNewsFlash.com top news stories for New York lawyers and consumers
LINK

New York, NY (JusticeNewsFlash.com)–Breaking news: Joseph L. Bruno, former New York State Senate majority leader was indicted Friday by federal prosecutors in Albany. The New York Times just reported the acting United States attorney out of Syracuse, Andrew T. Baxter presented before the federal judge in Albany today alleging Bruno collected more than $3 million over 13 years in illegal bribes. Accusations in court documents claim since 1993, Bruno accepted money from several businessmen seeking state contracts and grants, plus pension fund managers seeking control over the pension fund investments of over 16 labor unions.

Bruno, 79, Republican from Albany, who stepped down last year from his New York Senate position, pled not guilty in federal court today with his defense attorney. Bruno was released without bail Friday afternoon. Federal prosecutors are maintaining their belief in the 8 count indictment handed down by a federal grand jury. Bruno is charged with crimes depriving citizens of honest services from their elected officials under anti-corruption laws.

JusticeNewsFlash.com top news stories for New York lawyers

July 23, 2008
Bruno Takes New Job at Firm That Does Business With the State
By JEREMY W. PETERS, NY TIMES

ALBANY — It took all of four days, but Joseph L. Bruno has found a new job.

Mr. Bruno, the majority leader in the State Senate for more than a decade, is now the chief executive officer of an information-technology company that has numerous state contracts. State ethics rules bar Mr. Bruno, a Republican who left office on Friday, from lobbying the Legislature for two years. But nothing prevents him from doing business with the executive branch.

Mr. Bruno’s new employer, CMA Consulting Services, has contracts with the offices of the attorney general and comptroller, as well as the Office of General Services.

In an interview on Tuesday, Mr. Bruno, 79, said that in his new role, he planned to expand CMA, which is based in Latham, N.Y., an Albany suburb. He brushed off any suggestion that the deep ties he developed to state government over the course of a three-decade career in politics would be helpful in winning more government contracts.

“We’re going to look to grow the company in a very productive way, hopefully make some money and pay more taxes,” he said. “There are rapid growth opportunities here.” Business with New York State, he said, would not be the company’s focus for growth.

Mr. Bruno, whose pension from the Senate is between $90,000 and $100,000 a year, declined to say how much he would earn at CMA. “It’s not enough, whatever you get,” he said with a chuckle.

State records show that CMA has hired lobbyists to represent its interests in Albany. In 2007, it spent almost $95,000 lobbying for two bills that never became law. One would have set up a pilot program to monitor traffic in Nassau County using cameras similar to those that CMA sells.

CMA drew some scrutiny this year after it hired Robert Scott Gaddy, a former adviser to Assemblyman David F. Gantt of Rochester, as a lobbyist. Mr. Gantt, the chairman of the Assembly Transportation Committee, had long opposed traffic cameras as too intrusive, yet he introduced a bill that would allow cities and towns across the state to install them and require the kind of technology that CMA sells. Currently, only New York City is allowed to use such red-light cameras.

CMA has also given to state Republican causes, including a $600 contribution to Mr. Gantt two months ago and a $5,000 contribution in November 2006 to the New York State Senate Republican Campaign Committee.

Mr. Bruno replaces CMA’s former chief executive, Kay Stafford, who will become its president and chairwoman of the company’s board of directors. Mrs. Stafford, the widow of a Republican state senator, has longstanding ties to New York’s Republican Party.

Mr. Bruno, who left office under the specter of a federal investigation into his private business dealings while he was a senator, explained his new job as running the company’s day-to-day operations. “Everybody in the company will be reporting to me — about 410 employees.”

Mr. Bruno relinquished his Senate seat on Friday, saying that he wanted to spend more time with his family and go back to work in the private sector. He was apparently in high demand. Last week he said that he had been approached about eight or nine different jobs.

March 3, 2008
The Empire Zone
A Furor After Bruno’s Role Is Revealed
By DANNY HAKIM, NY TIMES

ALBANY — The Senate majority leader, Joseph L. Bruno, concedes in an interview in the current issue of New York magazine that he was paid by a Connecticut investment firm to encourage trustees of union pension funds in New York to do business with the company.

But the senator’s spokesman denounced the story on Sunday, saying the magazine had violated the terms of the interview.

Mr. Bruno held a salaried job with the investment firm, Wright Investors’ Service, for more than a decade, but nothing was known about what he did until last year. He left the firm in December, a few weeks after an article appeared in The New York Times detailing ties the firm had built with pension funds affiliated with union locals in and around the senator’s Albany area district. In some cases, trustees of the funds had personally lobbied the senator on a variety of issues.

Mr. Bruno has refused to detail what he did for the company, and Wright officials have said only that Mr. Bruno’s job was related to “business development.”

“I provided the entree,” Mr. Bruno told the magazine. “In that business, the biggest problem is access. I provided access.”

Regarding the unions, he said, “my pitch to them was, ‘If you like what they have to say, take it to the next level. If you don’t, say goodbye.’ ”

Good-government groups have raised concerns about the arrangement, but Mr. Bruno told the magazine that there was no quid pro quo.

Mr. Bruno’s chief spokesman, John McArdle, reacted angrily to the piece.

“New York magazine did a tremendous disservice to its readers and to Senator Bruno by shamefully and purposely taking out of context comments Senator Bruno made several months ago to its reporter that clearly were not intended to appear in print,” Mr. McArdle said. “It is especially troubling that this reporter chose to misrepresent his intentions and violate trust and access given him at a time when Senator Bruno was dealing with difficult personal and family issues.”

Mr. Bruno’s wife, Barbara, died this year after a long bout with Alzheimer’s disease.

In a statement, Lauren Starke, a spokeswoman for New York magazine, said the publication “fully stands behind” its story. “During the time he spent with our reporter, Senator Bruno spoke on the record and was fully aware that a feature story would result.” The senator’s business interests have been the subject of a federal investigation for about two years.

The magazine also quoted him saying, in reference to the investigation: “Who the hell knows if, inadvertently, there’s something there — that they uncovered, that they want to accuse you of.”

“That’s on my mind,” he added. “I think, ‘What the hell could they get somebody to say that I said or did?’ I know that’s what they try and do. They tried like hell to intimidate a couple of people.”

Pressure to Cross Over

With the margin of the Republican Senate majority down to a single seat after last week’s special election victory for Democrats, both sides have been resorting to seduction, attempting to woo new members from across the aisle.

“I have been approached for more than a year now,” said Senator Ruben Diaz Sr., a Democrat from the Bronx whose opposition to abortion might seem to make him an appealing prospect. “They’ve been approaching me, but I’m a Democrat, I’m a Democrat, I’m a Democrat. I like Bruno. I respect him. But these are my philosophies.”

Mr. Diaz, who also is a Pentecostal minister, instead said that the pressure to switch sides is now on Republican senators.

“I think some of the Republicans might switch,” he said. “The problem is on them.”

Republicans, however, have vowed to hang together.

Mr. Diaz said that the election last week of Darrel J. Aubertine, left, a Watertown Democrat who also opposes abortion, made for a welcome addition to the Democratic caucus.

“I am pro-life, and Aubertine is pro-life,” he said. “I’m delighted. The only thing that I don’t like about my party is its position on gay marriage and abortion. Other than that I’m as Democratic as they come.”

TRYMAINE LEE

Holding on to the Senate

A historical footnote to Mr. Aubertine’s victory in a heavily Republican district that was pointed out by political observers: In 1939, Republicans captured the State Senate and elected as the majority leader another politician from Watertown by the name of Perley A. Pitcher. It was the beginning of an era of Republican control in the Senate that has continued uninterrupted for all but one year since. JEREMY W. PETERS

A Constitutional Question

On to important technicalities. The razor-thin gap between the majority and minority parties in the Senate provokes a question: If there is a tie, what role would Lt. Gov. David A. Paterson, right, a Democrat, play?

The general thought is that the lieutenant governor, who presides over the Senate, would have tie-breaking power. But Democrats and Republicans, not surprisingly, have varying interpretations of the Constitution.

“Given our research, our position is that the lieutenant governor has a casting vote, which is clear in the Constitution and Senate rules,” said Christina Dickenson, deputy counsel to the Senate minority. “Our interpretation of that is something that hasn’t been tested. But in our opinion, it can be used for organizational matters, for procedural matters, motions made on the floor as well as passage of legislation.”

That, in essence, would give the Democrats the majority.

Meanwhile, Republicans believe that even if the Democrats pick up a seat to balance the scales, the lieutenant governor’s power is more limited.

“The Constitution is clear, very clear,” said Senate Republican spokesman John McArdle. “The Constitution gives certain rights to duly elected members. The lieutenant governor is not a duly elected member and is limited to certain procedural votes.”

When asked whether the Republicans would take legal action to defend their position should the argument become real, Mr. McArdle bristled at the notion, saying, “We’re not even contemplating that scenario.” TRYMAINE LEE

Bronzed, in Albany?

Reporters in the state capital have long been fascinated by the ability of Albany politicos on both sides of the aisle to look remarkably bronzed.

How do they do it? While touring Mr. Bruno’s farm, a New York magazine reporter, Geoffrey Gray, spied “a large, circular, retro-looking hunk of plastic and coils.”

“It looks like a spaceship,” Mr. Gray wrote. “It’s a tanning booth. His daughter Catherine once owned a tanning parlor,” he wrote, referring to Mr. Bruno, adding that the senator told him: “I fire her up, pop in once in a while.”

DANNY HAKIM

New York State Senate Majority Leader Joseph L. Bruno
Government Technology, June 95
LINK

Joseph L. Bruno was first elected to the state Senate in 1976. A Republican, Sen. Bruno was named chairman of the Legislative Commission on Public-Private Cooperation in 1989, and was a leader in the fight to control government costs, increase accountability, and reduce costly state mandates. Sen. Bruno was elected temporary president of the Senate in January 1995.

As a legislative priority, Sen. Bruno has highlighted the state's economy and has concentrated on programs to stimulate the creation of jobs, aid the growth of business and commerce and reduce personal taxes.

A former chairman of the board of Mitel Systems Integrators, and co-founder, chairman of the board and CEO of the Coradian Corp., Sen Bruno is well versed in technology.

Sen. Bruno was interviewed by Mike Nevins of State Technologies Inc., a non-profit firm based in Albany, N.Y.

GT: Congratulations on last month's announcement of the Online Public Exchange Network (OPEN Senate). It would seem the Senate is taking a leadership position in providing citizens online access to the legislative process. Is this something that has been in the works for some time?

Bruno: As soon as I became leader, I put together a group of fellow senators and we started talking about changes that should be made to open up the legislative process. This was one of them. It has been reviewed in the past, but I'm not really sure how serious people were about getting that much public access so quickly. I just think that is the direction we should be moving in government. It ought to be open, we ought to be responsive, people ought to have access. So we thought this was an important step and a big step and we wanted to do it quickly.

GT: A number of senators have Internet e-mail addresses now. How are they responding to this?

Bruno: I think most of them are sort of getting a kick out of being on the leading edge in terms of technology, and being able to communicate with each other and with the rest of the world. So I think they have had a very positive reaction. But as you know, people have to get used to knowing that it is there, how to use it and using it regularly. So there is that sort of burdening period - and I think we are going through that now.

GT: Since the announcement was only a month ago, is there any sense of the response from either citizens or interest groups?

Bruno: Any responses I have had have been positive. Some people made suggestions in terms of what might make us more operative. But by in large, everyone has been very positive about opening up the process and making it more accessible to the public and to those with a vested interest.

GT: Your private sector experience includes work in the technology industry. Have you found this to be helpful in your legislative work?

Bruno: Yes, it helps me a great deal and in a number of ways. For one, just having a background in business has been very important. We were in the communications business selling commercial telephone systems. We installed the first private branch exchange against AT&T; in New York. So we were kind of pioneers and competing against the Bell system after the Greene decision that broke up the Bell monopoly. We always sold leading edge products. That is good and bad because we were the first distributor for Rolm, for instance, in the United States. Rolm was one of the first computerized branch exchanges - they replaced the old crossfire systems with computers. We were the first distributor and installed the first Rolm in the U.S. They were one of the biggest communications companies ever in the U.S. and were sold to IBM.

But living life on the leading edge, you also learn that you have to work with the manufacturer in developing the technology so that it is workable. And the first six months or year we had nightmares with those systems. But it taught me that if you want to be on the leading edge and it's worth being there, you better have the resources to stay with the program. We did that in our business. We did take the lead. We were the biggest and fastest growing company in the state in the early parts of the industry. So that brings me back to the senate. We want to do things that are new, different and advanced - not just for the sake of technology, but to be responsive and accessible to the public. And if you're going to be responsive and accessible to them, you have to make the services that you provide "user friendly." You have a work station, you can turn on your TV and you're involved in the legislative process.

GT: Through the Centers for Advanced Technology and other initiatives, New York state has a long standing commitment to information technology as means to foster economic development. Do you see this as an opportunity for growth for New York state?

Bruno: Absolutely. I think it is something that we should develop here in the state. We have to invest in the latest technology and encourage it in every way. We are trying to play a role in that and we're going to be playing a bigger role because that is an area where the governor and I agree. I know we will take the lead and encourage technology here in the state through the growth of new businesses and the expansion of existing ones. So the answer is yes.

GT: There seems to be an enormous increase in interest regarding technology issues among legislators, both locally and nationwide. To what would you attribute this?

Bruno: I think it is really looking for ways to get the public more involved and interested in the legislative process. If we can make it easier for the public to participate and be involved in what goes on legislatively then they will take more of an interest. If the process is more cumbersome, they won't bother. The public is demanding that government get closer to them, more open to them, more responsive to them. I think you are seeing the state and federal government try to be responsive to that.

GT: Much of the recent talk around this project season has been around cost-cutting and downsizing government. Do you envision an increased focus toward technology solutions for service delivery?

Bruno: Yes. When you are trying to cut down the paperwork and trying to cut overhead costs - long term - as we all are in government, I think we have to turn to technology to do that. That is the direction we have been moving in as we try to make government more efficient.

GT: Several states have centralized at least the oversight of information technology into the office of a chief information officer. Senator LaValle's recently introduced bill (S. 2237) would create something like this. Is this something you would like to see happen?

Bruno: I think one of our challenges is to consolidate some of the information and services throughout the state. It's a big state, we have state agencies that do things independently of each other, which is often counterproductive. So yes, I think one of our challenges will be to pull the technology together and make it more efficient and more cost-effective, because now it's not.

GT: Along those same lines, Gov. Pataki recently announced an agreement with IBM which includes consolidation of some of the state's data centers into former IBM facilities in Kingston, Endicott and East Fishkill. Do you see this as a start of a new strategy for the state's handling of information?

Bruno: I believe so. I believe that you will see more and more of that - the consolidation of services and people. Again, the name of the game is efficiency and money. We have to deliver government services for less money.

GT: What role does the legislature play in developing those sort of strategies?

Bruno: We have, through our committee structure, tried to set up a system where we participate with the governor's office in formulation of programs and policy. On the initiation side, we try to be responsive when others bring proposals to us. We take a close look to see how we can help advance them. I work very closely with the RPI and the SUNY system and some of the things that they're doing and have been very instrumental in their work and helping to advance it.

GT: Does the legislature view an investment in technology as an investment in the future of service delivery?

Bruno: I do and I think most of my colleagues do. I think that is one of our challenges - to make sure that some of this gets funded and at least the seed money is there so things keep moving forward. Because as you know, when things are tight and we're looking at a $5 billion deficit, you get into the type of situation where the things that are here are the things that get cut before they even get a chance to be totally reviewed. We have to be careful of that.

GT: The private sector often advocates the use of technology as an enabling tool. It could lead to some dramatic changes in the business process. Do you see the state working more closely with the private sector to take advantage of some of their experiences?

Bruno: Well, the private sector as well as the public education system - RPI and SUNY - are taking the lead around here in sophisticated communications. I think we should form some kind of a partnership so we don't duplicate services. If we could do this, everyone would get so much more from their investment. We are going to be taking the lead in that if others don't. People tend to make more mistakes working in isolation. That is why we would like to coordinate some of these efforts. It's the biggest challenge and this governor has the opportunity to help pull it together.

GT: Are there any initiatives currently on the horizon?

Bruno: There are a number of them, but I can't give you the specifics. They get caught in the politics of trying to get something to happen. They get trapped in turf wars - who can do it best, who can do the most, who's the furthest advanced. What we need is to put our heads together and work toward a common goal. That is the challenge for this governor and for us as leaders.