Feds Bill Prosecution of Ex-Cuomo Aide as One of ‘Old-Fashioned Corruption’

Joseph Percoco (far right) ignores a group of protesters shouting behind him as he leaves an April 6, 2017, hearing ahead of his trial on federal corruption charges. (Photo by Adam Klasfeld, CNS)

MANHATTAN (CN) – Introducing a long-anticipated New York bribery trial, a federal prosecutor told jurors Tuesday that the case against Joseph Percoco, former deputy to Governor Andrew Cuomo, came from a long tradition.

“This case is about corruption – the old-fashioned kind,” Assistant U.S. Attorney Robert Boone said.

Percoco has pleaded not guilty to a wide-ranging criminal scheme involving more than $300,000 in bribes Percoco is said to have taken in return for favors to energy executives and developers.

Boone has described Percoco as the “right-hand man” in one of New York’s most recognized political dynasties, working for the current Cuomo administration and – in a more modest capacity – for Mario Cuomo, the governor’s father who was in office for three terms from 1983 to 1994.

Chart of bribery schemes released with prosecutor’s charges.

“Wherever the governor went, Percoco went,” Boone said, referring to Andrew Cuomo, who is rumored to be eyeing a presidential bid in 2020.

Defense attorney Barry Bohrer of Schulte Roth & Zabel said that Mario Cuomo called Percoco his “third son.”

“Mr. Percoco is a human being,” said Bohrer. “If there were mistakes made in this case… it was not evidence of a corrupt bargain.”

Standing trial with Percoco are energy executive Peter Galbraith Kelly and two Syracuse developers: Steven Aiello and Joseph Gerardi, the president and general counsel of Syracuse-based COR Development Co.

Prosecutor Boone promised to show the jury “that each of these men needed Percoco because each had companies that had business before the state.”

“Percoco had the authority and the ability to influence those decisions,” Boone added.

All of the men were charged by former U.S. Attorney Preet Bharara, whose crusade against political corruption brought down two state legislators.

Four other men will stand trial in July, and only one of the nine charged has pleaded guilty: Todd Howe, a political lobbyist now cooperating with the government.

Prosecutors uncovered emails Percoco exchanged with Howe in which they allegedly used “ziti” as a code word for bribe payments.

“You’re going to learn that he learned that word from a TV show we’re going to talk about later at trial,” Boone told the jury, hinting at a plot point from HBO’s mafia drama “The Sopranos.”

The 80-page criminal complaint liberally cites the macaroni mischief.

“Keep the ziti flowing,” one message says.

“Don’t want to tip over the Zitti wagon,” says another, using an alternate spelling.

Attorneys for Percoco, Kelly, Aiello, and Gerardi all depicted Howe, who sent and received the ziti emails, as a liar accusing their clients to escape his own legal problems. Percoco’s attorney hammered this point by punning on Howe’s middle name.

“Todd Ransom Howe has kidnapped the truth in this case, and he’s holding these gentlemen hostage,” Bohrer said. “And the ransom he seeks is a good deal: a lesser sentence and perhaps his own freedom.”

Howe pleaded guilty to eight counts of honest services fraud, wire fraud, extortion, conspiracy, tax evasion and other charges.

Boone emphasized that the jury does not have to like Howe to convict the other men.

Nonetheless, Boone told the jurors private emails would corroborate Howe’s tale.

“The emails tell the story,” he said. “If you pay attention to the emails, the defendants’ guilt will be clear.”

Gerardi attorney Milton Williams argued that Howe’s dishonesty made even physical evidence suspect.

“Todd Howe liked to alter and doctor emails,” said Williams, from the Lower Manhattan office of Walden Macht & Haran.

Lobbyist Peter Galbraith Kelly Jr.’s attorney Daniel Gitner took his own shots at Howe, in a folksy opening statement shortening his client’s mouthful of a name to “Braith.”

“Braith never bribed Joe,” Gitner said, referring to Kelly and Percoco.

For Aiello’s attorney Scott Iseman, from the Albany-based O’Connell and Aronowitz, the case rose and fell on Howe’s word.

“At the end of the day, you’re going to be asked a very, very simple question,” Iseman said. “Who do you believe? Steven Aiello, a man whose reputation has never been questioned, or do you believe the government’s Todd Howe?”

Opening statements marked by passion and outrage ebbed into dry and technical testimony by FBI forensic accountant Mollie Brewster, who spent the afternoon leading jurors through spreadsheets, charts and checks illustrating the Percoco family’s finances.

Prosecutors allege that Percoco abused his position in 2012 to land his wife a substitute teaching job and work at Kelly’s company Competitive Power Ventures (CPV), which was building fracked-gas power plants in New York and New Jersey.

That year, the Percocos bought a house in Westchester, and prosecutors said that they needed new sources of income to pay the bills.

Brewster showed the jurors illustrations of wife Lisa Percoco receiving payments from an entity associated with Chris Pitts, who worked for CPV, as well as from Potomac Strategies LLC, steered through COR.

On cross-examination, Percoco’s attorney Michael Yaeger led the witness through what the FBI illustrations left out – tens of thousands of dollars in the Percocos’ savings account, a point meant to undermine the prosecution’s interpretation of motive.

U.S. District Judge Valerie Caproni, who is presiding over the case, told Yaeger that he had belabored the point with too many questions.

“Seriously, you really have beat this puppy to death,” Caproni said.

An Alabama native with a droll and caustic wit, Caproni urged the parties to keep their questioning short and efficient over the course of the six-week trial.

While the judge acknowledged that Percoco and his co-defendants deserve a “vigorous defense,” she added that, “What [they’re] not entitled to is a tedious defense.”

Brewster will return to the stand on Tuesday, followed by Cuomo’s chief of staff and counselor Linda Lacewell.

 

%d bloggers like this: