December 19, 2011
Brooklyn Senator Expected to Plead Guilty in Corruption Case
By WILLIAM K. RASHBAUM and BENJAMIN WEISER, NY TIMES
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State Senator Carl Kruger was expected to plead guilty on Tuesday to federal corruption charges that he accepted at least $1 million in bribes to finance a lavish lifestyle, including a large home in Mill Basin, Brooklyn, where he lived with two gynecologist brothers and their mother, according to several people briefed on the case.

One of the brothers, Michael Turano, who was also charged in the corruption case unveiled in the spring, was expected to plead guilty along with Mr. Kruger, the people who were briefed said. Recorded conversations between the two men revealed that they were intimate companions.

Mr. Kruger, an influential Democrat and 16-year legislator, was expected to plead guilty to four of the five counts in the indictment, according to two of the people. The charges include fraud conspiracy, for which he could face up to 20 years in prison, and bribery conspiracy, which carries a maximum term of five years.

The two people said Mr. Turano, also charged with all five counts, was expected to plead guilty to a single bribery conspiracy count, for which he would face a maximum of five years in prison.

Mr. Kruger’s lawyer, Benjamin Brafman, said Mr. Kruger and Mr. Turano were scheduled to appear before the presiding judge in the case, Jed S. Rakoff of Federal District Court in Manhattan, on Tuesday afternoon; he would not discuss the details of what was expected to transpire. If he pleads guilty to a felony, Mr. Kruger will automatically lose his job.

Mr. Turano’s lawyer, Robert F. Katzberg, declined to comment, as did a spokeswoman for the United States attorney, Preet Bharara.

Mr. Kruger, Mr. Turano and six other men, including Assemblyman William F. Boyland Jr., two hospital executives, a lobbyist and a developer, were arrested in the case in March. A criminal complaint detailed a smorgasbord of schemes, most of which included a single staple: the senator accepting bribes.

And the schemes were lucrative, according to the charges. Mr. Kruger collected at least $1 million in bribes, the authorities said, in return for all manner of political favors, like helping hospitals seeking to merge, getting state money for real estate developers and even expanding the business hours of liquor stores. The bribes, according to prosecutors, financed a four-door Bentley Arnage and the Mill Basin home, which was originally built for a boss of the Luchese crime family.

Mr. Kruger, through his lawyer, denied wrongdoing when he was charged. Mr. Kruger has said he is not gay.

Mr. Boyland, a Democrat, who was tried separately before Judge Rakoff last month, was acquitted of conspiring to take $175,000 in bribes in return for using his influence on behalf of a health care organization that operates hospitals in Queens and Brooklyn.

Less than three weeks later, federal prosecutors in Brooklyn charged him with soliciting $250,000 in bribes in a separate case that accused him of continuing to commit corruption crimes after his arrest on the first case — and of seeking bribes to pay the lawyers in that case. Mr. Boyland’s case was the second stemming from the original charges issued in March.

In September, another defendant, David P. Rosen, the former chief executive of the health care organization, MediSys, was convicted of conspiring to bribe Mr. Boyland — as well as Mr. Kruger and a third legislator, Anthony S. Seminerio, a Democratic assemblyman from Queens — in return for favorable treatment for MediSys.

Mr. Seminerio, who pleaded guilty to fraud in an earlier case, has since died.



NEW YORK (CBSNewYork) – State Sen. Carl Kruger will be in court today where he’s expected to plead guilty to federal corruption charges, according to published reports.

The charges allege that the 16 year legislator accepted at least a $1 million in bribes to finance a lavish lifestyle, which included a home in Mill Basin, Brooklyn where he lived with two doctors.

Kruger allegedly accepted bribes in return for a host of political favors, including helping hospitals seeking to merge, obtaining state money for real estate developers and expanding the business hours of liquor stores.

Kruger is expected to plead guilty to four of the five counts in the indictment and faces up to 25 years in prison.

Kruger was the Senate Finance Committee chairman from 2008 to 2010 when Democrats controlled the Senate.

March 10, 2011
Graft Charges Depict Kruger’s Lavish Lifestyle
By NICHOLAS CONFESSORE and MICHAEL BARBARO, NY TIMES
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In Albany, State Senator Carl Kruger was a canny and influential lawmaker for 16 years, respected for his command of the political currency that matters most: raising and spreading around campaign contributions.

But there was something unusual about Mr. Kruger. He rarely socialized with fellow senators, seemed uncomfortable in crowds, frequently took his lunch alone in the drab Capitol cafeteria and, in an age of ubiquitous cellphones, could be spotted whispering into public pay phones.

On Thursday, federal prosecutors unveiled a 53-page criminal complaint against Mr. Kruger, 61, that unlocked many of the mysteries of his life — but deepened others. It portrayed a man who had amassed at least $1 million in bribes in return for political favors: helping hospitals seeking to merge, obtaining state money for real-estate developers, expanding the business hours of liquor stores.

And it revealed, prosecutors say, that the seemingly measured senator was using the bribes to bankroll a lavish lifestyle, financing a four-door Bentley Arnage and a $2 million waterfront home originally built for a boss of the Luchese crime family.

Mr. Kruger and seven other defendants — including Assemblyman William F. Boyland Jr., a fellow Brooklyn Democrat, and a prominent lobbyist, Richard Lipsky — were charged by federal prosecutors in Manhattan with what United States Attorney Preet Bharara called “a broad-based bribery racket.”

Mr. Bharara expressed exasperation over the unrelenting corruption in Albany, saying lawmakers did not appear to learn.

“Every single time we arrest a state senator or assemblyman, it should be a jarring wake-up call,” Mr. Bharara said. “Instead, it seems that no matter how many times the alarm goes off, Albany just hits the snooze button.”

Mr. Kruger, wearing a dark suit and overcoat, entered the Jacob K. Javits Federal Building in Lower Manhattan about 8:30 a.m. along with his lawyer, Benjamin Brafman. He said nothing to reporters.

A judge released the defendants, none of whom entered a plea.

“He’s saddened,” Mr. Brafman said, “because he’s been one of the most dedicated public servants for the last 25 years with an impeccable reputation. This is obviously a difficult day for all of us.”

The Senate Democratic leader, John L. Sampson, removed Senator Kruger on Thursday from his position as ranking member of the Finance Committee, effective immediately. Austin Shafran, a spokesman for the Senate Democrats, said in a statement, “These are serious charges, and it is inappropriate to comment further on an ongoing legal matter.”

In the investigation, the Federal Bureau of Investigation used a bug and taps on the cellphones of Senator Kruger and Mr. Lipsky, among others.

The complaint accuses Senator Kruger of accepting bribes to obtain state money for Parkway Hospital in Forest Hills, Queens and to oppose a big box store in Brooklyn; and of doling out $500,000 in state funds to one of Mr. Lipsky’s clients.

Another of the accused was David P. Rosen, whose company, MediSys Health Network, gave Assemblyman Boyland a no-show job, according to the complaint. The lawmaker helped the company get a meeting with a New York State Health Department official, the complaint said.

But it was the tangled tale of Mr. Kruger — the stocky son of a cabdriver whose accent still bears the inflection of his native Brooklyn neighborhood, Brownsville — that most captivated Albany, now jaded by run-of-the-mill pay-to-play stories.

Under the scheme, according to the complaint, Mr. Kruger sometimes accepted payments from Mr. Lipsky, the lobbyist, to do work on behalf of his clients. Other times, prosecutors said, he accepted bribes from hospitals that were funneled through a friend and partner, Solomon Kalish.

In 2009, according to the complaint, Mr. Kruger received money from Mr. Lipsky and worked against a bill expanding the reach of state recycling laws, which was opposed by beverage distributors for whom Mr. Lipsky lobbied.

When his effort failed and the bill passed, Mr. Kruger introduced a bill to delay the date the new law would go into effect.

The complaint said Mr. Kruger last year tried to help a developer and client of Mr. Lipsky’s — not named but easily recognizable as Forest City Ratner — to obtain money for three projects: $9 million for the Carlton Avenue Bridge, $2 million for a retail development in Mill Basin and $4 million for the renovation of the skating rink in Prospect Park.

Beyond the accusations of official misconduct, the complaint also described the personal drama around how the money was allegedly used by Mr. Kruger and the Turano family of Mill Basin.

Despite listing his official residence as his sister’s home on Avenue L in Mill Basin, Mr. Kruger had all but moved in with the Turanos in their 7,000-square-foot home, which towers over others in the neighborhood and features ostentatious sculptures of frolicking children and soaring seagulls.

At the Turanos’, he helped manage the household and shop for groceries, and even help pick out a gravestone for the family plot. He also oversaw the installation of security cameras and sprinklers at the Mill Basin home.

No one was especially sure of what to make of the senator’s place in the house, which was occupied by two brothers, Michael S. Turano, 49, and Gerard I. Turano, 47, and their mother, Dorothy Turano, 73.

Mrs. Turano, who is divorced, often appeared with Mr. Kruger at public events, and some neighbors described the two as a couple. But, it was the oldest son, Michael, to whom Mr. Kruger was closest, and they forged a relationship in which they “supported and relied on one another,” according to the complaint.

And it was Michael Turano, the complaint said, who established shell companies to conceal the bribes, and later used the money to finance the Bentley, pay credit card bills and make mortgage payments on the house. One of the accounts bore the name “Bassett,” the name of the street on which they lived.

Michael Turano was charged in the criminal conspiracy, along with Mr. Kruger, Mr. Lipsky, Mr. Boyland and Mr. Rosen. The hospital executive Robert Aquino; the hospital consultant, Mr. Kalish; and the real-estate developer Aaron Malinsky were also charged. All the defendants surrendered on Thursday morning.

The events on Thursday capped a year of personal and political pressure for Mr. Kruger. News that he had been under federal investigation surfaced last June, and last month, an associate of his agreed to plead guilty in another federal inquiry.

Recently, when staying at the Turanos, Mr. Kruger had made it a point to park his car around the corner from the house, in what neighbors viewed as a curious change of habit.

He has also faced unusually intense criticism from gay rights activists for his 2009 vote against a Senate bill legalizing same-sex marriage. Activists traveled last year to the Turano residence and the Brooklyn home of Mr. Kruger’s sister, protesting loudly and saying Mr. Kruger himself was gay. Mr. Kruger has said he is not gay.

Two activists also crashed an evening fund-raiser Mr. Kruger held last March at an Albany hotel, presenting themselves as guests of one of the co-hosts, Mr. Sampson. As a dozen or so lobbyists and donors — ticket prices topped out at $9,500, the maximum legal donation to a senator’s campaign — snacked on chicken and pasta, the activists berated Mr. Kruger.

Neighbors interviewed on Thursday said they were offended by the visits from the gay rights protesters, with their placards and chants.

But the area is accustomed to a bit of theater: Anthony Casso, the Luchese crime family boss who poured hundreds of thousands of dollars into the house Mr. Kruger and the Turanos share, never moved in. And, apparently worried that the architect who designed it knew about illegal activities, he ordered him killed.

William K. Rashbaum, Colin Moynihan, Noah Rosenberg and Tim Stelloh contributed reporting.

This article has been revised to reflect the following correction:

Correction: March 10, 2011

An earlier version of this article misspelled Carl Kruger's given name as Karl.

March 10, 2011
Federal Corruption Case Ensnares a Self-Styled Fighter for the Underdog
By DAVID M. HALBFINGER, NY TIMES
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He was omnipresent in the press rooms at City Hall and the State Capitol in Albany, a wiry man with a gray mustache, bags under his eyes and a Bluetooth headset that seemed to have been permanently lodged inside his ear — endlessly pushing, prodding and pitching stories.

In 30 years of advocacy work, Richard J. Lipsky, 63, the lobbyist who surrendered on Thursday to face charges that he bribed a Brooklyn senator to do his clients’ bidding, managed to convert his media savvy, tirelessness and pugnacity into a raw and often menacing kind of political influence: ephemeral, but real.

“People can underestimate the gamesmanship that goes into getting press around an issue,” said David Lombino, an economic development official in the Bloomberg administration who got to know Mr. Lipsky while a reporter for the now-defunct New York Sun. “He was very effective at getting coverage. That gave him power.”

Mr. Lipsky styled himself a fighter for the underdog, picking fights with City Hall, and with corporate behemoths like Wal-Mart or real estate giants like the Related Companies. He seemed to have carved out, and sewn up for himself, a niche representing small businesses: bodega owners, independent grocers, immigrant entrepreneurs, small-time beer distributors. Adversaries saw him as unscrupulous and unsavory, stirring up crises to make a buck, even by needlessly inflaming racial tensions.

But according to federal prosecutors, Mr. Lipsky had come to rely heavily on one well-placed politician to do his bidding, State Senator Carl Kruger, Democrat of Brooklyn, and was secretly paying him for his services.

Prosecutors said over $100,000 in cash was found in a safe in his home, and some $4,000 in crisp bills was in his suit pocket.

Mr. Lipsky is accused of splitting his fees with Mr. Kruger, the former chairman of the Senate Finance Committee, in exchange for Mr. Kruger’s official actions on behalf of his clients: business interests as varied as the Red Apple Group, the operator of the Gristede’s groceries and hundreds of convenience stores, and a Bronx beverage distributor known as Good-O. None of the clients were accused of wrongdoing. Neither Mr. Lipsky, his lawyer, nor his son — a former business partner now working at a major law firm — responded to requests for comment.

In addition to Mr. Lipsky and Mr. Kruger, the others charged in the corruption case were Assemblyman William F. Boyland Jr.; David P. Rosen, chief executive of MediSys Health Systems; the hospital executive Robert Aquino; the hospital consultant Solomon Kalish; the real estate developer Aaron Malinsky; and Dr. Michael Turano.

If Mr. Lipsky was portrayed in the federal complaint as a corrupt agent for a crooked politician, for years he has occupied a different kind of middle ground, a hall-of-mirrors-like gray area of conflicted loyalties.

He fought against a Fairway market in Harlem after offering to help the company with any land-use problems there. He helped the grocery workers’ union in its fight against Wal-Mart, while separately representing the owners of scores of nonunion groceries that the union said exploited workers. He fought on behalf of Dominican store owners against an East Harlem Pathmark in the 1990s, but later signed up to lobby for the much bigger East River Plaza, with stores like Target and Costco, in the same neighborhood.

Mr. Lombino recalled Mayor Michael R. Bloomberg’s asking, at a ribbon-cutting for the East River Plaza, what the difference was between a Target, which sailed through the approvals process, and a Wal-Mart, which has met all-out resistance.

“I think the answer was Richard Lipsky,” Mr. Lombino said. “There was a flexibility in his ideology that I think was becoming more apparent.”

Mr. Lipsky earned a doctorate in political science from the City University of New York Graduate Center in 1979, worked as an assistant professor at Manhattanville College and wrote a book on the relationship between sports and politics in American life. He took a job as an aide to a Bronx assemblyman, Louis Nine. And in the early 1980s, he has said, he helped defeat a Pathmark long planned for Zerega Avenue.

That was the first of many similar battles. Some ended in victories: a B. J.’s Wholesale Club proposed by Related was rejected in the Bronx, and the Kingsbridge Armory redevelopment, also a project by Related, was ended in 2009 after Mr. Lipsky went to work on behalf of a local grocery owner. Another fight involved his work on behalf of car-repair shop and junkyard owners who wanted to stop the city’s sweeping redevelopment of their dilapidated section of Willets Point, Queens.

“He’s been fighting the cigarette wars for us with the Indians for years, and where are we? No place,” said John Catsimatidis, the chairman of Red Apple, citing other acrimonious Albany skirmishes. “He was fighting the bottle law, and he lost that one too. He’s good at communications, but we didn’t win many.”

In recent years, Mr. Lipsky’s blog, full of flamboyantly written screeds and carefully argued indictments — often of Mr. Bloomberg, whom he derides as “the King” — became his most potent weapon, according to fans and foes alike, and enhanced his claims of being the one lobbyist willing to fight City Hall.

“He’s got a sharp tongue,” said Michael Nieves, a political operative who worked with Mr. Lipsky on Willets Point. “The same way that Rudy Giuliani would send the message, ‘I’m the big bad U.S. attorney, and I know how to come after you,’ Richard’s message was: ‘I know how to use the press, and the pen. If you mess with me, I’ll come after you.’ ”

Everyone, it seemed, was subject to his withering scrutiny. But if he sometimes burned bridges — Joseph B. Rose, Mr. Giuliani’s planning commissioner, stopping taking his calls — he seemed to outlast those he alienated.

If he is proven guilty, however, it will be the politician to whom he had ingratiated himself the most who brings about Mr. Lipsky’s downfall.

Mr. Catsimatidis said he got a hint of that closeness when he was thinking of running for mayor in 2009. Mr. Lipsky brought Mr. Kruger to his office, he said. “Kruger said he wanted to help me,” he said. “I guess Lipsky told Kruger he has access. But we didn’t hire Kruger’s people.”

But when the subject of his hiring people tied to Mr. Kruger had been broached, Mr. Catsimatidis called a halt to the questions. “Full stop,” he said.

On Monday, as agents searched his Riverside Drive home, Mr. Lipsky’s phone rang 26 times with calls from Mr. Kruger, prosecutors say. Mr. Lipsky called a political associate and asked him to tell Mr. Kruger to “stop calling me and tell him why.”