Westchester Attorney Indicted in Mortgage Fraud Scheme

Westchester lawyer indicted in mortgage fraud scheme
The Mid-Hudson News - February 17, 2010

WHITE PLAINS, NY – Federal authorities Wednesday announced the indictment of Louis Cherico, 69, of Eastchester, a Westchester lawyer who allegedly participated in a fraudulent real estate investment scheme. Officials said the scheme had as its primary objective the purchase of multi-million dollar residential properties in communities including Purchase, Eastchester and Rye, with loans obtained through the submission of false and misleading information to banks and other lenders. Many of the loans were equal to or more than 100 percent of the property’s actual sale price, so Cherico and his co-conspirators did not have to put any of their own money at risk in the transaction. It is alleged that Cherico submitted documents to several federally insured banks with false or misleading information about the income, assets, existing debt and credit-worthiness of the borrower, the chain of title to the property, and the sale price of the home. The indictment also charges Cherico with laundering the illegal obtained from the sale of one of the properties used in the mortgage fraud scheme by transferring the proceeds from a bank account controlled by Cherico to an account that was controlled by one of his co-conspirators, Dominick DeVito.

Here's the FBI PRESS RELEASE:

Department of Justice Press Release

For Immediate Release
February 17, 2010 United States Attorney's Office
Southern District of New York
Contact: (212) 637-2600

Manhattan U.S. Attorney Charges Lawyer with Multi-Million-Dollar Mortgage Fraud, Money Laundering and Obstruction of Justice

PREET BHARARA, the United States Attorney for the Southern District of New York, and JOSEPH M. DEMAREST, JR., the Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation ("FBI"), announced the unsealing of an Indictment yesterday charging LOUIS CHERICO, a lawyer who practiced in New York City and Westchester County, with participating in a wide-ranging scheme to commit mortgage fraud, obstruction of justice, and money laundering.

According to the Indictment filed in Manhattan federal court:

From July through December of 2002, CHERICO participated in a fraudulent real estate investment scheme which had, as its primary objective, the purchase of multimilliondollar residential properties in various communities in Westchester County, New York, including Purchase, Eastchester, and Rye, with loans obtained through the submission of false and misleading information to banks and other lenders. Many of the loans were equal to or in excess of one hundred percent of a property's actual sale price, so that the defendant and his coconspirators did not have to put any of their own money at risk in the transaction. CHERICO served as the attorney for various coconspirators in negotiating and closing the fraudulent purchases that were part of the scheme. CHERICO and his co-conspirators submitted to numerous federally-insured banks various documents, including loan applications, contracts of sale, deeds, real estate transfer documents, and title reports. Those documents contained materially false or misleading information about the income, assets, existing debt and credit-worthiness of the borrower, the chain of title to the property, and the sale price of the home, as well as the borrower's intent to reside in the property as a primary residence, when, in fact, the properties were typically purchased for investment purposes. As a result of the scheme to defraud, CHERICO and his co-conspirators obtained millions of dollars in loan proceeds, enabling them to control certain properties that they otherwise would not have been able to purchase and finance. The Indictment also charges CHERICO with laundering the illegal proceeds obtained from the sale of one of the properties used in the mortgage fraud scheme by transferring the proceeds from a bank account controlled by CHERICO to an account that was controlled by one of his co-conspirators, DOMINICK DeVITO. The transaction was designed to conceal and disguise the nature, location, source, ownership, and control of the illegal proceeds. The Indictment further charges CHERICO with obstruction of justice, and conspiracy to obstruct justice, in connection with the 2003 sentencing of DOMINICK DeVITO, following DeVITO's conviction in United States v. Pasquale Parello, et al.,(01 Cr. 1120) in United States District Court for the Southern District of New York on charges of racketeering and mortgage fraud. Specifically, CHERICO assisted DeVITO in concealing profits that DeVITO earned from the sale of a property located in Purchase, New York, and in submitting an affidavit containing false and misleading information about the sale to the United States Probation Office. CHERICO, 69, of Eastchester, New York, was arrested this morning and was presented and arraigned this afernoon in Manhattan federal court. The case has been assigned to United States District Judge COLLEEN McMAHON. If convicted, CHERICO faces a maximum sentence of 30 years in prison on each of the six counts of mortgage fraud, 20 years in prison on the money laundering count, 10 years in prison on the obstruction count, five years in prison on the conspiracy to obstruct justice, and a fine of the greater of $1,000,000, or twice the gross gain or loss resulting from the crime. Mr. BHARARA praised the work of the FBI. This case is being prosecuted by the Office's Organized Crime Unit. Assistant United States Attorney JONATHAN B. NEW is in charge of the prosecution. The charges contained in the Indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.

******* END OF FBI PRESS RELEASE *******

FBI trash probe goes into Allied site in Mt. Kisco
The Journal News by Terry Corcoran and Cara Matthews - July 27, 2005

FBI agents executed a search warrant at a Mount Kisco transfer station Wednesday, the latest development in a widening criminal investigation into organized crime in the garbage industry in New York and Connecticut. William F. Williams, Mount Kisco's village manager, confirmed yesterday that the FBI searched a transfer station owned by Allied Waste Industries on Columbus Avenue on Wednesday evening. But he said he did not know what the agents were seeking. "They didn't tell the police anything," Williams said. "The police just informed me that they executed a search warrant there." The search came one day after federal authorities executed warrants at several locations in Connecticut and New York, including Putnam County Executive Robert Bondi's office in Carmel and Suburban Carting Corp. in Mamaroneck, also an Allied-owned transfer station. Federal agents removed roughly a dozen boxes from Bondi's office Tuesday night. Bondi has not been available for comment, but Legislature Chairman Robert McGuigan, R-Mahopac, has said that Bondi left him a phone message saying the search was related to the garbage-hauling industry, and there was no corruption on Bondi's part.

The target of the probe, law enforcement officials said, is James E. Galante, a 52-year-old businessman who runs a garbage empire in Connecticut that includes Automated Waste Disposal of Danbury, Conn., and several affiliated businesses. Galante is also a major figure in Putnam's carting industry and is a former business partner of Thomas Milo, a Pelham Manor resident who served time in the 1990s for rigging garbage contracts in Westchester. Milo is the former owner of Suburban Carting, reportedly also a subject of the probe. Federal agents on Tuesday searched Automated Waste Disposal, a massive trash-collection and recycling operation at 307 White St., Danbury; Galante's home in the nearby suburb of New Fairfield; and the Danbury office of his attorney, Jack D. Garamella. Messages left with Galante and Garamella, 60, have not been returned. In all, agents have raided more than two dozen addresses this week, including a New Haven, Conn., transfer station and sanitation companies on Long Island.

One of Galante's lawyers, defense attorney Hugh Keefe of New Haven, said federal agents had not told him much about the investigation. "I have gotten precious little information out of the government," Keefe said. "In due time, I'm sure we'll talk." Milo, who has been identified by prosecutors as an organized-crime figure, could not be reached for comment yesterday. Milo's wife said yesterday that he was at work, but she would not say where. Court records show that Galante was sentenced in 1999 to a year and a day in prison after pleading guilty to federal tax evasion. He was also fined $100,000 plus the cost of his incarceration, and Automated Waste Disposal was fined $210,000. One of the related businesses Galante owns is Superior Waste Disposal, which lists its address at 307 White St., Danbury, according to records filed with New York's Department of State. Putnam County paid Superior $103,740 in 2003, $115,005 in 2004 and $59,511 this year to pick up trash at county facilities, Finance Department records show. David Steinmetz, a White Plains-based attorney for Allied Waste, wouldn't comment about the FBI's search of the company's Mamaroneck and Mount Kisco properties. The attorney said that as far as he had been advised, his client cooperated fully with the FBI investigation "of other individuals." In March 2004, two of Galante's companies, Greensphere Inc. and Transfer Systems Inc., were fined $13,600 by the Westchester County Solid Waste Commission for dumping solid waste at the Resco incinerator in Peekskill without commission permits. Garamella, Galante's lawyer, entered not-guilty pleas on two counts of unlicensed operation and paid a reduced $6,800 fine after the company argued it did not know it needed permits to dump in Westchester. No companies that Galante is associated with have licenses with the Solid Waste Commission to do business in Westchester, executive director Bruce Berger said yesterday. Records in New York and Connecticut show a complex web of connections among Galante, Milo and Allied Waste, the nation's second-largest garbage handler. Allied, with revenues of $5.66 billion in 2004, took over several Westchester companies after an organized-crime monopoly on the industry was broken up by federal indictment in the late 1990s. The biggest player in Westchester's garbage industry at the time was Milo's Suburban Carting, which also owned 40 percent of the stock in Galante's Automated Waste Disposal. In February 1998, Milo was sentenced to three years in prison and paid $3.2 million in fines and restitution for the part he played in what prosecutors said was a mob-run scheme that used price fixing, violence and intimidation to control Westchester's garbage industry over 35 years. Milo currently heads Mialto Realty Inc., according to New York Department of State records. The principal executive office is listed at the same 524 Waverly Ave. address in Mamaroneck as Suburban Carting. There is no listing in the phone book for the business. One of the contacts listed for Mialto is the law firm of Cherico & Stix, now called Cherico, Cherico & Associates on Battle Avenue in White Plains.

The firm at one point represented Automated Waste Disposal. Attorney Louis Cherico did not return a phone call seeking comment yesterday, but on Wednesday he said his firm had not represented Galante's company in two years. Suburban Carting also has offices at 566 N. State Road in Briarcliff Manor. That same address is shared by Valley Carting Corp., another carting company bought by Allied in 1999. All of Allied's Westchester subsidiaries - Valley Carting, the Mount Kisco transfer station and the Metro Enviro transfer station in Croton-on-Hudson - came under federal monitorship because of Allied's purchase of Suburban Carting and that company's role in the federal organized-crime case. The federal monitor uncovered deceptive business practices by Valley Carting and Metro Enviro under Allied's ownership. A March 2004 federal monitor's report on Valley Carting said Allied's management was not "discernibly different" from when the company was led by James Hickey and Toby DeMicco, Hickey's late father-in-law and the son of a reputed soldier in the Genovese crime family. A 2003 report on Metro Enviro documented operating abuses, such as exceeding daily tonnages, doctoring records and accepting banned materials. Hickey, who died in 2002, also co-owned Greentree Realty, a company that at one time shared the same 566 N. State Road address as Valley Carting and now Suburban. Greentree owns the land in Croton where Metro Enviro is situated and leases the property to Allied. Staff writers Sean Gorman and Timothy O'Connor and The Associated Press contributed to this report.

Judge Covers Eyes for Cop Arrested Half-Dozen Times

Troubled cop cleared in 2008 drunken driving crash
The Times Union by PAUL NELSON - February 17, 2010

SCHENECTADY, NY -- Fighting to keep his job amid criminal and internal charges, jailed city cop John Lewis won a legal victory today when a judge acquitted him of drunk driving charges. City Court Judge Guido Loyola said there simply was not enough evidence to convict Lewis, 40, of driving while intoxicated charges related to his arrest the day after Christmas 2008. The judge also dismissed a traffic ticket for speeding. The judge did convict Lewis of traffic infractions for failure to drive on the proper side of the roadway and ordered him to pay a $160 fine. "It was the right decision and we're pleased," said Lewis' attorney, Michael Horan. "I think the judge focused on the essential elements of the crime, which was the testimony of the officers on the scene, whether they observed any indication that the defendant was intoxicated." Assistant District Attorney Michael Tiffany said, "We put the facts out there and the judge makes the determination. We felt there were sufficient facts to find him guilty." When asked about trial testimony that officers on the scene turned off a police car video camera and microphones, Tiffany said, "Why would somebody want to turn off their cameras and microphones and what conclusions can you draw from that?"

It's the second time Loyola has exonerated Lewis. In March 2008, Loyola, in another bench trial, cleared Lewis of harassment related to allegations he had fought with his ex-wife over custody of their young son. But his legal woes are far from over and top police officials have publicly said they want him fired. He is currently being held without bail in Schenectady County Jail after facing a second DWI charge in relation to a Jan. 23 accident in the Ellis Hospital parking lot. Lewis, who his attorney said has a drinking problem, also pleaded not guilty to a 10-count indictment accusing him of using a former girlfriend's computer to hack into his ex-wife's e-mail accounts. He has filed a notice of claim contending the city conspired with his ex-wife to get him fired. In December, Lewis suffered a stab wound in Massachusetts, allegedly at the hands of his girlfriend. He has not been on active duty with the Schenectady Police Department since March 2008 and is on unpaid suspension. During the two-day DWI trial, Assistant District Attorney Michael Tiffany argued that Lewis was out drinking all night on Dec. 26, 2008 and crashed his black SUV into a parked vehicle in the 1000 block of Eastern Avenue at around 4:30 a.m.Defense Attorney Michael Horan countered that prosecutors couldn't prove Lewis was drunk at the accident scene, noting he didn't take a Breathalyzer until four hours later. Meanwhile, an independent hearing officer who presided at an internal affairs disciplinary hearing will soon issue a decision that could result in his termination. In the past two years, Lewis has been arrested a half-dozen times on domestic violence and drunken driving charges. He also is facing charges stemming from a fight with his brother, also a police officer. Lewis' trouble with the department date back to 1998, when an arbitrator reversed his firing over his use of a racial slur at the police station. Paul Nelson can be reached at 454-5347 or by e-mail at pnelson@timesunion.com.

Hope for the Judiciary: Bharara Targets Political Corruption

Stamping out political corruption a top priority for U.S. Attorney Preet Bharara
The New York Daily News by Alison Gendar, James Gordon Meek and Larry - February 14, 2010

Just six months into the job, U.S. Attorney Preet Bharara vows to stamp out political corruption in wake of Larry Seabrook's 13-count indictment.

In U.S. Attorney Preet Bharara's view of history, corruption was invented around the same time as fire and the wheel. "Unscrupulous cavemen no doubt fleeced unsuspecting Neanderthals out of clubs and animal skins when the opportunity arose," the prosecutor observed drolly last November. The crimes evolved along with the species, as Bharara knows only too well. Just six months into the job, the prosecutor is making corruption a top priority - targeting public servants and the private sector. Last week's 13-count indictment of City Councilman Larry Seabrook (D-Bronx) was the latest salvo from Bharara, an Obama nominee sworn in Aug. 13, 2009. "In my office, we have a thriving and successful public corruption unit," Bharara said in a speech this month. "At the moment, business is not slow. "This is vitally important work, in my view." The new head of the Southern District, considered the most prestigious post among U.S. attorneys, took a circuitous route to his spacious lower Manhattan office.

Bharara, 40, is a naturalized American citizen born in India. His father grew up in a small village, living in a home without plumbing, and came to America "with only a few dollars in his pocket and a hope in his heart that we would have a better life," Bharara said at his swearing-in ceremony. He was an infant when his family settled in suburban New Jersey. Bharara graduated magna cum laude from Harvard in 1990, earning a Columbia Law School degree three years later. He went into private practice after a short stint with Mark Green's campaign for public advocate. Bharara became a Southern District prosecutor in 2000, spending the next five years prosecuting cases involving securities fraud, organized crime and drugs. But he really made his bones as counsel to Sen. Chuck Schumer (D-N.Y.), spearheading the probe of ex-Attorney General Alberto Gonzales' politicization of the Justice Department. Gonzales resigned in disgrace over the investigation into the Bush administration's 2006 firings of nine U.S. attorneys. Bharara persuaded his mentor and ex-Southern District boss, former Deputy Attorney General Jim Comey, to provide dramatic testimony against Gonzales. Comey recounted how Gonzales - then White House counsel - tried to persuade hospitalized Attorney General John Ashcroft to sign off on warrantless spying. Comey, as acting attorney general, had refused; Gonzales unsuccessfully pressed Ashcroft, recovering from painful surgery, to overrule him. Bharara is married with three kids, and made a point of thanking his wife when he was sworn in. "If anyone has ever had a more supportive partner in life, I'm not aware of it," he said. Befitting of a Jersey guy, Bharara is also a Bruce Springsteen fan - often playing The Boss' music in his office while working long hours as an assistant U.S. attorney. Bharara now heads the office of more than 450 people, including more than 200 assistant U.S. attorneys. He oversees an annual budget of $50 million. And he intends to direct those resources against white collar crooks, Wall Street schemers and crooked politicians. Their motives, he believes, remain unchanged since the Stone Age. "Greed, gullibility and things of value are the basic elements of financial fraud," he said. "History tells us that these ingredients have existed for millennia." agendar@nydailynews.com

Update on Judicial "Kids for Cash" Scandal

Ciavarella's Juvenile Cases Thrown Out
WNEP by Ryan Coyle - January 25, 2010

A judge has thrown out all juvenile cases that were handled by former Luzerne County judge Mark Ciavarella between 2003 and 2008. For many it was a big sigh of relief. For others,it was a reminder of the corruption that troubles the county. Either way, Luzerne County officials feel like they are moving forward. A Luzerne County judge ruled Monday that 5,000 juvenile cases overseen by disgraced former judge Mark Ciavarella will all be thrown out. The move comes after District Attorney Jackie Musto Carroll announced she would not retry the accused. It comes on the eve of the one-year anniversary of the plea agreement made between Ciavarella and federal prosecutors. That agreement has since been withdrawn. Today county officials said the ruling is another step forward. "I don't think that something like this can happen ever again. That it happened in Luzerne County is very tragic. We are an example that shows how something should not be done. We know that here, no one is ever going to have to teach us that lesson," said District Attorney Jackie Musto Carroll. "I think that we have set the gold standard for cleaning up violations of kids rights and the corruption that took place here," said Marsha Levick of the Juvenile Law Center. The 5,000 cases were vacated from the state's highest court last year but now the cases have been thrown out, meaning there is no chance for them to be retried. That ruling pleased many who felt they got a bad break from the county. Craig Daniels of Nanticoke was among those whose record was cleared. "Everything from 2003 and on got dropped so I'm pretty happy about that," Daniels said. Others weren't so confident that this will fix the problems facing the county. Florence Myers is the mother of two children who have gone through the justice system. "I don't feel like it's still healed. I feel there's still a lot of injustice that's still here. I don't feel trust still here," Myers said. Chief public defender Basil Russin said changes have been made in the how they approach the juvenile court.

******BACKGROUND STORY:

Pa. judges accused of jailing kids for cash
Judges allegedly took $2.6 million in payoffs to put juveniles in lockups
The Associated Press

WILKES-BARRE, Pa. - For years, the juvenile court system in Wilkes-Barre operated like a conveyor belt: Youngsters were brought before judges without a lawyer, given hearings that lasted only a minute or two, and then sent off to juvenile prison for months for minor offenses. The explanation, prosecutors say, was corruption on the bench. In one of the most shocking cases of courtroom graft on record, two Pennsylvania judges have been charged with taking millions of dollars in kickbacks to send teenagers to two privately run youth detention centers. “I’ve never encountered, and I don’t think that we will in our lifetimes, a case where literally thousands of kids’ lives were just tossed aside in order for a couple of judges to make some money,” said Marsha Levick, an attorney with the Philadelphia-based Juvenile Law Center, which is representing hundreds of youths sentenced in Wilkes-Barre. Prosecutors say Luzerne County Judges Mark Ciavarella and Michael Conahan took $2.6 million in payoffs to put juvenile offenders in lockups run by PA Child Care LLC and a sister company, Western PA Child Care LLC. The judges were charged on Jan. 26 and removed from the bench by the Pennsylvania Supreme Court shortly afterward. No company officials have been charged, but the investigation is still going on. The high court, meanwhile, is looking into whether hundreds or even thousands of sentences should be overturned and the juveniles’ records expunged. Among the offenders were teenagers who were locked up for months for stealing loose change from cars, writing a prank note and possessing drug paraphernalia. Many had never been in trouble before. Some were imprisoned even after probation officers recommended against it. Many appeared without lawyers, despite the U.S. Supreme Court’s landmark 1967 ruling that children have a constitutional right to counsel.

'I have disgraced my judgeship'

The judges are scheduled to plead guilty to fraud Thursday in federal court. Their plea agreements call for sentences of more than seven years behind bars. Ciavarella, 58, who presided over Luzerne County’s juvenile court for 12 years, acknowledged last week in a letter to his former colleagues, “I have disgraced my judgeship. My actions have destroyed everything I worked to accomplish and I have only myself to blame.” Ciavarella, though, has denied he got kickbacks for sending youths to prison. Conahan, 56, has remained silent about the case. Many Pennsylvania counties contract with privately run juvenile detention centers, paying them either a fixed overall fee or a certain amount per youth, per day. In Luzerne County, prosecutors say, Conahan shut down the county-run juvenile prison in 2002 and helped the two companies secure rich contracts worth tens of millions of dollars, at least some of that dependent on how many juveniles were locked up. One of the contracts — a 20-year agreement with PA Child Care worth an estimated $58 million — was later canceled by the county as exorbitant. The judges are accused of taking payoffs between 2003 and 2006.

Allegations of extortion

Robert J. Powell co-owned PA Child Care and Western PA Child Care until June. His attorney, Mark Sheppard, said his client was the victim of an extortion scheme. “Bob Powell never solicited a nickel from these judges and really was a victim of their demands,” he said. “These judges made it very plain to Mr. Powell that he was going to be required to pay certain monies.” For years, youth advocacy groups complained that Ciavarella was ridiculously harsh and ran roughshod over youngsters’ constitutional rights. Ciavarella sent a quarter of his juvenile defendants to detention centers from 2002 to 2006, compared with a statewide rate of one in 10. The criminal charges confirmed the advocacy groups’ worst suspicions and have called into question all the sentences he pronounced. Hillary Transue did not have an attorney, nor was she told of her right to one, when she appeared in Ciavarella’s courtroom in 2007 for building a MySpace page that lampooned her assistant principal. Her mother, Laurene Transue, worked for 16 years in the child services department of another county and said she was certain Hillary would get a slap on the wrist. Instead, Ciavarella sentenced her to three months; she got out after a month, with help from a lawyer. “I felt so disgraced for a while, like, what do people think of me now?” said Hillary, now 17 and a high school senior who plans to become an English teacher.

'I was completely destroyed'

Laurene Transue said Ciavarella “was playing God. And not only was he doing that, he was getting money for it. He was betraying the trust put in him to do what is best for children.” Kurt Kruger, now 22, had never been in trouble with the law until the day police accused him of acting as a lookout while his friend shoplifted less than $200 worth of DVDs from Wal-Mart. He said he didn’t know his friend was going to steal anything. Kruger pleaded guilty before Ciavarella and spent three days in a company-run juvenile detention center, plus four months at a youth wilderness camp run by a different operator. “Never in a million years did I think that I would actually get sent away. I was completely destroyed,” said Kruger, who later dropped out of school. He said he wants to get his record expunged, earn his high school equivalency diploma and go to college. “I got a raw deal, and yeah, it’s not fair,” he said, “but now it’s 100 times bigger than me.”

New York Corruption Top$ California Any Day

Judge Faces Discipline Over Small Claims Case
The Recorder by Cheryl Miller - February 10, 2010

SACRAMENTO, CA - Placer County Judge Joseph O'Flaherty says he was just trying to do right by litigants in his court. Investigators with the Commission on Judicial Performance say the superior court jurist abused his authority. Which side is right will be determined in the coming months as the commission pursues charges against O'Flaherty of willful misconduct, conduct prejudicial to the administration of justice and improper action. The charges stem from a December 2008 small claims case involving car salesman Scott Herold and two employees of a Roseville credit union. Herold had sued the credit union workers for allegedly interfering in the would-be sale of a car to one of their customers - a sale that eventually fell through, said James Murphy, O'Flaherty's attorney. After O'Flaherty dismissed the case, Herold left the courtroom. The two credit union employees then told the judge they feared Herold might retaliate against them. O'Flaherty had his bailiff summon Herold back to the courtroom. "I'm going to put it bluntly," O'Flaherty told Herold. "I think you've been abusing these people, and I don't like it." O'Flaherty then ordered Herold to stay away from the employees, both women, and their bank branch for 90 days. If he didn't, O'Flaherty warned that he would issue a restraining order.

The National Problem of Prosecutorial Misconduct

Department of Justice Press Release
For Immediate Release
February 5, 2010 United States Attorney's Office
Northern District of Florida
Contact: (850) 942-8430

Former Dixie County Attorney Sentenced to 87 Months’ Imprisonment

GAINESVILLE, FL—Thomas F. Kirwin, United States Attorney for the Northern District of Florida announced that Joseph T. Lander, the former County Attorney for Dixie County, was sentenced to 87 months’ imprisonment following a sentencing hearing conducted today before United States District Judge Stephan P. Mickle in Gainesville. Lander had been indicted for mail, wire, and bank fraud, as well as money laundering arising from his actions as the Dixie County Attorney and as the CEO of GenSpec, LLC., a vitamin company he founded. Lander was convicted of five counts of mail fraud and 11 counts of money laundering at the conclusion of a jury trial in October of last year. Evidence introduced at trial established that Lander fraudulently induced a former client and others to invest in GenSpec. Lander diverted the funds from those investments into other businesses he started. At sentencing, the Court found that Lander had diverted more than $1,000,000 to his own use over a five-month period of time. Evidence at trial also showed that while acting as County Attorney in 2005, Lander fraudulently demanded and received payment of an $820,000 performance bond from developers having business before Dixie County. At the time Lander demanded payment of the performance bond, he knew that no bond was required and had no authority to personally accept payment of the bond, which was deposited into Lander’s law firm account. Lander then spent more than $300,000 of the money on luxury items and other personal expenses. Additional provisions of the sentence require Lander to pay a $50,000 fine, $1600 in court costs, and serve a three-year term of supervised release upon completing his prison sentence. A restitution hearing will be scheduled within the next 90 days to determine the amount of loss. Lander was immediately taken into custody after the judge determined he was a flight risk. Mr. Kirwin praised the work of the Federal Bureau of Investigation and the Florida Department of Law Enforcement, whose investigation led to the convictions in this case. The case was prosecuted by Assistant United States Attorney Gregory McMahon.

Feds Not Fooling Around, Finally, Lawyer Goes Into Hiding

Lawyer goes into hiding
The Omaha World Herald By Todd Cooper - January 10, 2010

To his friends and former colleagues, this is the extent of Terry L. Haddock's existence today:
A voice on a speakerphone. A voice that echoes with both resolve and resignation. In measured words, the Omaha attorney confides that he is in hiding after he wore a wire to help the U.S. government indict inmate Shannon E. Williams and 10 others in a massive marijuana conspiracy. I realize I could lose my law license over this, his friends have recalled him saying in recent weeks. But, please, don't jump to conclusions. Williams talked about committing crimes, about eliminating witnesses. I had to do something. And that's it. Just as quickly as he tantalizes former colleagues, he shuts down — saying federal prosecutors have asked him not to talk about why he chose to risk his legal career, even his life, by taking on the marijuana ring and its alleged kingpin. In a case that will hinge in large part on Haddock's credibility, here's what Haddock doesn't always divulge: His involvement in the federal investigation came after a yearlong stretch in which his personal and professional lives began to circle the drain. Law enforcement officials close to the investigation say Haddock, 52, became enthralled with a 23-year-old woman from Zimbabwe who describes herself as a former escort. His wife filed for divorce. Credit card debt mounted. He was hospitalized for health problems and later treated for mental health problems. He stopped answering his phone, meeting with clients or showing up for court. Then the federal government came calling, offering the man who friends say “hates drugs” and “hates drama” a front-row seat to both. Haddock began wearing a wire and smuggling a cell phone into the Douglas County Jail to witness Williams orchestrate the movement of marijuana and money from Phoenix to Omaha. “They got the perfect guy,” said an Omaha attorney, a former Haddock colleague who spoke on condition of anonymity. “You have to understand with Terry — if he concluded something was right, he was going to continue to pursue it, no matter how futile the fight. “In his world, there's good and bad — and he was going to do good. He's just one of those guys who, rightly or wrongly, sees everything in black and white.” Scottsbluff attorney Maren Chaloupka doesn't remember the black-and-white nature of Haddock. She remembers the white. “To me, he was a nondescript, middle-aged white guy,” Chaloupka said. Chaloupka worked with Haddock briefly in 2004 when the two attorneys jointly filed a lawsuit against the Omaha Public Schools on behalf of a student who got kicked out of Burke High School. Chaloupka eventually took over the case. She said she was floored when she recently heard of Haddock's undercover work. “He certainly didn't strike me as the kind of guy who would take on a bona fide bad (guy),” she said. “He just seemed like a milquetoast sort of guy.” At the time of his involvement in this case, Haddock was just seven years into what had been a relatively benign legal career. A nontraditional student, the Columbus, Neb., native graduated from the University of Nebraska at Omaha with a perfect 4.0 GPA in 1998. He then graduated from the University of Nebraska-Lincoln College of Law in 2001, received his law license in Colorado in 2002 and Nebraska in 2003, and joined the Omaha law firm of Raynor, Rensch & Pfeiffer. At the small firm — its Web site lists fewer than 10 attorneys — Haddock handled “whatever he brought in the door,” a former colleague said. Divorces. Child custody. Immigration. Drunken driving. Other than his filing of the lawsuit against OPS, he made news when he and a neighbor engaged in a running dispute over the neighbor's loud music and brash behavior. He later filed a defamation lawsuit over that squabble, claiming an Omaha man's false statements caused “mental and physical harm” to him, including hospitalizations and medical expenses of more than $2,500. The case was dismissed after a couple of years. Colleagues describe Haddock as a “bulldog” who worked hard and long for his clients. “He was pretty persistent, pretty effective,” said a longtime Omaha attorney. “He wasn't afraid to pick up the phone and get things done before it got to the courtroom.” At times, colleagues said, he worked too hard — obsessing over and appealing judges' rulings that didn't go his way. “He would put an extraordinary amount of effort into something that should have been a tenth of the time,” said another attorney who spoke on condition of anonymity. “He just wasted a lot of time on stinkers that he should have walked away from.” In 2008, Haddock did walk away. From his wife of 30 years. From his cases. From his practice. His pursuit, according to two law enforcement officials close to the investigation: Nyasha Muchegwa, the 23-year-old immigrant from Zimbabwe. Haddock became enamored of the former nursing assistant who advertised herself on the Internet as an “escort,” the officials said. In an interview, Muchegwa said she met Haddock at the Nebraska Furniture Mart. He noticed her accent and asked where she was from. The two struck up a friendship, she said. Over time, she said, Haddock provided great help to her family on immigration matters and to her on a DUI and a couple of other misdemeanors. She said that she didn't have an affair with him — that there was “nothing sensual, nothing ungodly” about their relationship. She views him as “family, like a brother or cousin,” she said. Her account was different in a November 2008 sworn deposition about a crime she witnessed. Prosecutor Michael Jensen — who said he was curious about Haddock's zealous representation of Muchegwa — asked about their relationship.

Jensen: “Prior to Mr. Haddock becoming your attorney, did you ever have any relationship with him?”
Muchegwa: “No I didn't … he's more of a friend.”
Jensen: “And did you ever see Mr. Haddock on more than just a friendship basis?”
Muchegwa: “At one point, yes, I did.”
Jensen: “Was that prior to him becoming your attorney?”
Muchegwa: “That was prior.”
Jensen: “Has that ever happened since he's become your attorney?”
Muchegwa: “No.”

Whatever the relationship, Haddock was involved in Muchegwa's world. And any time Muchegwa was in trouble, the attorney wasn't far behind. In May 2008, she was pulled over for not having a front license plate on her car. Officers ticketed her for that and for driving under suspension. They then arrested her on a misdemeanor warrant. But before they could book her into jail, Haddock was at her side. Haddock offered to have her talk to investigators about another crime. Then came Oct. 5, 2008. Illinois state troopers pulled over a U-Haul speeding on Interstate 80 and discovered 329 pounds of marijuana inside. With the driver's cooperation, agents followed the U-Haul to Omaha to try to round up others involved.

Soon, the U.S. Attorney's Office in Omaha filed a marijuana conspiracy charge against Steve Kisseberth, John Oglesby, Richard Conway and one woman: Nyasha Muchegwa. That night, Muchegwa had gone with Conway to the SuperTarget near 132nd Street and West Maple Road. Conway got out of the car and headed toward the U-Haul. Agents then watched Muchegwa drive away and park near the Dairy Queen — facing the U-Haul. “Based on the actions observed of Muchegwa,” a federal drug agent wrote, “affiant believes that she was acting as a lookout for Conway.” Within a day, Haddock rode to Muchegwa's rescue — albeit reluctantly. On Oct. 6, 2008, Haddock told Muchegwa he wouldn't represent her unless she paid him. She told him where to find cash in her northwest Omaha apartment. While searching for the cash, Omaha police reports say, Haddock found a gun under Muchegwa's bed and unloaded it. He found a small baggie of marijuana and flushed it down the toilet. Soon after, he turned over the gun to police and took Muchegwa to the U.S. Attorney's Office to tell her story. Muchegwa told prosecutors that she had just begun dating Conway and that she didn't know anything about the conspiracy or what was going on that night. On Oct. 21, 2008, federal prosecutors dismissed charges against Muchegwa and another Omaha resident. As it turned out, that traffic stop in Illinois — and the resulting cooperation of Conway and Kisseberth — helped launch the investigation into Williams and 10 others. And it brought Haddock into the case to briefly represent both Muchegwa and Conway. After charges were filed, investigators say, Williams paid Haddock $8,000 to represent Conway. It was in the course of those discussions that Williams, who was acquitted of a 1993 murder, started talking about eliminating witnesses, Haddock has told others. Haddock told friends he had to act. Federal prosecutors won't say what led them to make the bold move of having Haddock wear a wire to record their conversations. Nor have they said whether the government is paying Haddock to work as an informant. One thing is clear: Haddock's constant presence around Muchegwa gave investigators access to an attorney who was diligent — and increasingly desperate. Haddock's wife had filed for divorce in July 2008. About the same time, Haddock essentially stopped meeting with clients or going to court.

In a 2008 case, Haddock put up no defense for a client accused of breaking a woman's leg by ramming her with a car. When he and the client continually failed to appear to contest the lawsuit, Sarpy County District Judge David Arterburn slapped Haddock's client with a $250,000 judgment. Soon after, Haddock submitted an affidavit saying he was solely at fault for mishandling the case. Haddock wrote that he was hospitalized for physical issues; court documents indicate he told others he suffers from Crohn's disease and severe depression. He wrote that his “physical and mental health continued to deteriorate throughout the summer and fall months of 2008, that he became unable to manage normal day-to-day activities,” according to a judge's summary. “He states that, at some point, he stopped answering his phone, stopped opening his mail, stopped managing his files.” Haddock, who eventually left Raynor, Rensch & Pfeiffer, put it this way in his affidavit: “I withdrew from everything and everyone.” He entered into mental health treatment in February 2009. Investigators began outfitting him with a wire a couple of months later. Now the man who was at the center of the investigation is sure to be in the crosshairs in court. Nothing about Haddock or his credibility will go unexamined as attorneys seek to throw out more than 30 tapes of meetings between Haddock and Williams. Haddock isn't talking to reporters. Williams is. In a jailhouse interview last week, Williams said he is convinced that Haddock became involved to curry favor for Muchegwa. “He went undercover to get her out of trouble,” Williams said. “I wish I had an attorney like that.” Muchegwa calls that ludicrous. She noted that her charges were dismissed in October 2008 — several months before Haddock began wearing a wire. “There was no reason for him to do it for me — my case was already dropped,” she said. “I have no idea why he did what he did. “Only God knows.” Contact the writer: 444-1275, todd.cooper@owh.com

Corrupt Westchester Surrogate Court Gouls Salivating, Again

Woman, 78, found 6 months after she died
The Journal News by Hoa Nguyen - February 6, 2010

CHAPPAQUA, NY — The body of a 78-year-old woman living by herself who appeared to have died in her home six months ago was found Thursday by New Castle police, officials said. Jane Wild died in the second-floor bathroom of her home at 406 Bedford Road around August but her body, which was reduced to a skeleton, was not discovered until her lawyer contacted police and asked them to break down her door, according to a neighbor and an investigator from the Westchester County Medical Examiner's Office. The lawyer had been trying to get in touch with her for the past two months, the medical examiner's investigator said. The utilities to her home had been turned off for months and mail service was discontinued after it began accumulating in her mailbox, according to the medical examiner. Police said the incident remains under investigation. The home sits on an acre, set back from the road and surrounded by trees. Despite the inactivity in the home, the driveway and pathways appeared to have been regularly plowed and landscaping was up to date. Neighbors said Wild was a recluse whom they hardly saw coming and going. Snow plowing and landscaping service was done by a contractor who billed in six-month increments and wasn't particularly demanding when it came to requesting payment, neighbors said. At some point, Wild lived with a sister, but that relative had since died, leaving her by herself. Bedford Road, also known as Route 117, is a main thoroughfare with few walkers and with homes set far apart from one another as to promote privacy, but also isolation, neighbors said. They said the homes sit on large one-acre lots, and they wouldn't have noticed that one home lacked electricity. In general, neighbors said they don't know each other well or socialize much within the community. "It's 117 and hard to do that," said Sarah Dearmont, a Bedford Road resident who had never met or seen Wild. New Castle Supervisor Barbara Gerrard said the town is home to many older residents who live alone, and offers them services designed to help them. "I'm sorry to hear about that," she said of Wild's death. "We do try to provide assistance to those who live by themselves." One such program is called "R-U-O-K," which telephones residents who sign up for the service once a day to check on them. It was unclear whether Wild was enrolled or knew about the program, though Gerrard said the services are well-publicized throughout the town. "She was of that age, she must have known about it," Gerrard said. hnguyen7@lohud.com

Court Attorney Moves into Dead Lady's Home, Family Members Stunned

We celebrate the 12-year anniversary of the scheme by the Surrogate's Court Law Department charged with over-seeing the wishes of the departed. The Court's own Law Department found their own court attorney moving into a decedant's Scarsdale home with her family. That same Law Department attorney-referee, Jody B. Keltz, is now involved in the Brooke Astor estate proceedings. When 88-year-old Berta M. Murray died on August 12, 1997, she probably had not previously considered that the Scarsdale home built by her father, and that had been in her family for decades, would soon be occupied by a Westchester County Surrogate’s Court attorney-referee who worked in the very same court’s law department charged with the duty to oversee the affairs of the deceased-- A fact that has been secreted from her surviving relatives, they say. But Westchester Surrogate’s Court employee, attorney-referee Jody Keltz and her attorney-husband, Carl T. Peluso of Peluso & Touger in Manhattan, really liked that house at 168 Gaylor Road in Scarsdale, so in they moved in the Spring of 1998. And the two attorneys still call it home, even now as questions swirl as to just how they came to own the dead lady’s house. By all accounts, the Keltz-Peluso attorneys never knew Berta, and they had most likely never invited the elderly widow to their prior home located at 75 Third Place in Brooklyn, New York. “It’s outrageous that a Surrogate’s Court lawyer bought Berta’s house,” said an 80-plus-year-old cousin of Berta, and who only recently learned that Ms. Keltz was a lawyer in the Westchester Surrogate’s Court. “This stinks to high heaven, and I’m mad. It’s just not right, I don’t like this at all!” she added. The real estate deal by the Keltz-Peluso team is reminiscent of a Brooklyn Surrogate Court “arrangement” in 2002 where, as the Village Voice described it, Judge Scholnick’s clerk “…snatched up the 11-room brownstone…of 85-year-old Elsie Perry…in a move that would make Donald Trump proud…” Honorably, Brooklyn Chief Court Clerk, George Crowley, refused to keep quite, saying publicly that, “If I did this, I would expect to be fired. The whole thing was unethical…the judge shouldn’t have allowed it…” Brooklyn senior court official Crowley was so outraged by the cozy inside real estate deal that he took the highly unusual step of placing a note about it in the decedent’s Brooklyn Surrogate’s Court case file. But in the Westchester Murray-Keltz-Peluso transfer, no such concern has ever been voiced or documented by Surrogate’s Court Chief Clerk John Kelly or Surrogates Emanuelli or Scarpino. “Isn’t a Surrogate Court supposed to make sure everything is on the up-and-up, and handled properly?” asked Berta’s cousin, adding, “I knew Berta over seventy years, and everyone knew she wanted that house to stay in the family.”

Berta’s Dead: Enter The Vultures

A cursory review of Berta Murray’s estate file appears that it is largely normal, according to legal experts engaged to analyze the Murray estate transactions, and who are familiar with New York estate law, ethical obligations and the specific practices of the Westchester County Surrogate’s Court. However, they noted, the complete absence of any estate file “accounting” is quite unusual. And though not required, the name of Surrogate’s Court attorney-referee Jody B. Keltz, is nowhere to be found in the estate file. However, a review of the property Deed on file in the Westchester County Clerk’s office memorializes the transfer of ownership of 168 Gaylor Road in Scarsdale from the “Estate of Berta M. Murray…by The Bank of New York…to Carl T. Peluso and Jody B. Keltz, his wife.” In a recent telephone conversation, a court employee confirmed that Ms. Keltz was still employed as an attorney-referee in the Surrogate’s Court’s law department. When asked to comment about the Keltz property transfer, she advised that, “If you want to keep your job around here, you keep your mouth shut.” When asked her name, the telephone connection ended.

Move from Scarsdale to an Astor Estate Would Be Nice

A quick review of Berta’s estate file also shows a relatively standard probate proceeding, and it is quickly observed that The Bank of New York is the fiduciary and that the house was valued at $350,000.00--approximately one half of the total estate value of $742,968.00.

• But an in-depth analysis reveals some eyebrow-raising facts, including that Berta’s last will was substantially different than her stated wishes as expressed to friends and relatives since her husband Elmer died in December of 1982. “In Westchester, everyone gets a crumb,” one estate lawyer noted. But those associated with the “new” wishes of Berta Murray EACH received “crumbs” worth tens of thousands of dollars: Attorney W. Rowland Miller of the Judy, Miller & O’Connor law firm in Scarsdale, and who drafted the Will for Berta (and in which The Bank of New York is named as the new fiduciary), and who was then retained as the attorney for the fiduciary, The Bank of New York;
  
• Attorney Samuel S. Yasgur, then of the Hall Dickler law firm, and who was appointed by former Hall Dicker lawyer and then-Judge Emanuelli to represent “unknown heirs”; and
  
• Real estate agent Camille Paradise of Claire D. Leone Real Estate, who lived in Berta’s neighborhood and who was the realtor that handled the sale of the house to court employee Keltz and her husband.

“Judges and attorneys have an obligation to avoid even the appearance of impropriety,” observed one White Plains estate attorney who asked that his name be withheld, adding, “But that ethical requirement doesn’t apply here-- every player gets their piece of the pie-- that’s how court business is done in Westchester County.” He conceded that, “On its face, this doesn’t look good-- a state-employed attorney-referee working in the Surrogate’s Court shouldn’t be purchasing a house from any estate her court is overseeing.” Under Westchester County Surrogate Anthony A. Scarpino, court attorney-referee Jody B. Keltz continues her work insuring a high level of integrity in the administration of estate proceedings, also while holding professional fiduciaries, such as banks, to a high set of ethical and performance standards. The biggest “crumb” from the Estate of Berta M. Murray went to Westchester County Surrogate’s Court attorney-referee Jody B. Keltz and her attorney-husband Carl T. Peluzo. That “crumb” -- the house and property located at 168 Gaylor Road in Scarsdale is, according to the village of Scarsdale tax office, now conservatively valued at $950,000.00.

State Judge Guilty on 3 Federal Corruption Charges

State judge Manuel Barraza guilty on three charges
The El Paso Times by Ramon Bracamontes - February 5, 2010

Barraza's trial for fraud and making a false statement to a federal agent. Barraza was found guilty on three charges Thursday. He faces up to 20 years in prison and a $250,000 fine on each of the fraud convictions and up to three years in prison and a $250,000 fine for the false statement charge.

EL PASO, TX -- Stoic and seemingly more concerned about his family than himself, state judge Manuel Barraza politely sat and listened Thursday as jurors found him guilty of devising a scheme to receive sex and money for a judicial ruling. The only words Barraza spoke were "yes, sir," and they were in response to a series of orders and lectures from U.S. District Court Judge Frank Montalvo. "Be prepared to go to prison on April 28," Montalvo told Barraza. "My intention was to remand you to the custody of the U.S. Marshals today," he said. "Your lawyers recommended that I not remand you because of the complexity of the case and because of appeals." Montalvo paused, then continued with a lecture. "You will not discuss this case with anyone, not your family, not the press, not anyone. If you do, I will revoke your bond." Barraza, 54, has been free on bond since FBI agents arrested him in April 2009. A grand jury indicted him on two counts of wire fraud, one count of mail fraud and one count of making a false statement to a federal agent. The jury of six women and six men convicted Barraza of both counts of wire fraud and lying to a federal officer. They acquitted him of mail fraud. Their deliberations lasted a bit more than five hours over two days. Barraza faces up to 20 years in prison and a $250,000 fine on each of the fraud convictions, and up to three years in prison and a $250,000 fine for the false statement charge. Montalvo left no doubt that he would sentence Barraza to prison. During a break that came moments after the verdict was read, Barraza did what he could to comfort his shaken family. Upon adjournment, he left the courthouse by himself. He did not speak to anyone outside. John Barraza, his brother, said the judge was most concerned about his family. "He told us not to worry, that everything would be OK, that this was just part of the process," John Barraza said. His father, Manuel Barraza Sr., would only say that everything was all right. The rest of the Barraza family left the courthouse without talking to outsiders. Barraza's lawyers did not want to talk about the specifics of the trial. "Obviously we are disappointed with the verdict," said Ken Del Valle, one of Barraza's lawyers. "That's all I can say." Mervyn Mosbacker, Barraza's lead attorney, would not say if they would appeal. "It was a fair process. We can't complain about the process in any way," Mosbacker said. Barraza's trial took almost three weeks. Prosecutors called 13 witnesses and played 15 audio and video recordings to prove that Barraza tried to influence a drug defendant's case by moving it into his courtroom. The audio and video recordings shown to the jurors were perhaps the strongest part of the prosecution's case. Two videos showed Barraza accepting more than $5,000 in cash from a woman who visited him in his judicial office early last year. She was Sarai Valencia, 24, whose sister was in jail on a cocaine charge. Barraza years earlier had represented the sister, Diana Rivas Valencia, in a different drug case. He succeeded then in getting the charges against her dismissed. Accused of possession of two kilos of cocaine, Rivas Valencia wanted his help again. This time, though, Barraza was a sitting judge who could not legally represent defendants in criminal cases. Rivas Valencia testified that Barraza said he would help her if she paid him and found women willing to have sex with him. In one of the videos, Sarai Valencia delivered the money to Barraza as though it came from her and her family. The cash payments, for $3,800 and $1,300, actually were provided by the FBI. Jurors were never told that Sarai Valencia had a prostitution conviction. Montalvo ruled that her past was irrelevant to the case against Barraza. In his defense, Barraza's attorneys characterized him as an efficient and hard-working judge who had just taken office in January 2009 when the FBI set out to derail his career. Ramon Bracamontes may be reached at rbracamontes@elpasotimes.com; 546-6142.


Suspended Judge Barraza Guilty On 3 Federal Charges
KFOX News by Reporter Derek Shore - February 4, 2010

EL PASO, Texas -- A federal jury has announced a verdict in the case of suspended Judge Manuel Barraza Thursday. Barraza was found guilty of charges related to a bribery scheme. The jury found Barraza guilty on two counts of wire fraud and one count of lying to a federal agent. They acquitted him of one charge of mail fraud. Evidence revealed that in December 2008 to Feb. 26, 2009, Barraza solicited and accepted bribes in the form of cash money. He also solicited sex and agreed to accept a bribe of engaging in sexual activity with women, said the U.S. attorney’s office. U.S. Attorney John E. Murphy released a statement: "These acts were all committed in exchange for his influence and exercise of discretion in his official capacity as an elected judge. In carrying out his bribery scheme, Judge Barraza promised to intervene in a felony criminal case filed by the State of Texas pending in state district court in order to influence the outcome of the case." Barraza could face more than 40 years in federal prison and a $750,000 fine when he is sentenced on April 28. Judge Frank Montalvo told Barraza, "Be prepared to go to prison on April 28." "We got a trial that was orderly and presented well on both sides. The judge, I think, did a good job in presiding over this trial…. We can't complain about the process, we may have some complaints about areas of the law," said Mervyn Mosbacker, Barraza’s attorney. Mosbacker would not comment if they planned to appeal the verdict. KFOX spoke with El Paso’s administrative judge, Patrick Garcia. He said he had yet to hear that the State Commission on Judicial Conduct had removed Barraza permanently as a judge.

Click here to see related story, "FBI FILMS JUDGE TALKING CASH"

NY Daily News Calls for "Radical, Dramatic Action" to Clean Up New York

Countdown to disaster: Albany keeps ducking hard budget choices
The New York Daily News - EDITORIAL - February 6, 2010

Only radical, dramatic action by Gov. Paterson and the Legislature now stands between New Yorkers and severe damage to the quality of life. With each day, the state and city governments sink ever deeper into financial ruin because of plummeting tax collections. Paterson's two-week-old plan for balancing the books is suddenly short by an additional $1 billion. And the Metropolitan Transportation Authority has watched $350 million simply evaporate. Paterson and the Legislature would produce dire consequences should they hold to their traditional approaches to budget balancing.

They would:

• Force the NYPD to lay off 3,150 cops, a move that would likely reverse the city's hard-won victories over crime.
• Drive the schools to lay off 8,500 teachers, pushing up class sizes and threatening to reverse student achievement gains of the last five years.
• Compel astronomical hikes in subway and bus fares, and deep service cuts.
• Close firehouses, increasing response times to emergencies.
• Shutter libraries that are already cutting back hours in Manhattan and Queens.

And worse and worse. America's Great Recession and the damage done to Wall Street have dealt powerful, long-term blows to New York's economy and, with it, tax revenue. As a result, Albany has no choice but to reduce expenses. Paterson proposed a budget that did so by inflicting all the above horrors - before he lost that $1 billion and before the MTA went $350 million deeper into the hole. So now what? The public employee unions have begun to call for tax hikes. New York State United Teachers, for one, has urged imposition of a levy on stock transfers with the goal of raising $3 billion annually. This would be reckless insanity. The tax would drive out stock trading, irreparably weakening New York City as the world capital of finance. As for other levies, there will undoubtedly be a push for a new round of a so-called millionaire's levy. This, too, would be destructively nuts. New Yorkers who make more than $250,000 now pay combined city and state taxes at the highest effective rate in more than 30 years. And President Obama has targeted these top earners for a new federal hit in the elimination of President George W. Bush's excessive tax cuts. Adding to the state burden would create an incentive for some to leave New York - with all their tax payments. Lest you say, "Let them go," consider the following astounding statistics: Of 3.7 million tax filers in the five boroughs, the top 5,000 accounted for almost 40% of all the income taxes paid to the city. Meanwhile, half of those 3.7 million filers have been fully exempted from local income tax because their wages fall below the taxable limit. That's progressive taxation, and it's the right policy. But when a city of 8 million is so dependent on revenue from a mere 5,000 people, you can't afford to lose any of them. What's urgently needed is a budget that moves New York toward fundamentally reforming its expenses - in particular, the cost of workforces whose pensions and benefits far exceed those in the private sector and who remain, even now, in line for annual pay hikes of 4% a year. The tradeoff is clear. Invest the money there or in maintaining public safety, education and transportation. This is not a close call.

If You Come Out Against Corruption in New York: WATCH OUT!

Will The New York Times expose a Gov. Paterson scandal?
The Post-Standard by Gloria Wright - February 5, 2010

The N.Y. Daily News and New York Magazine report today that the blogosphere is buzzing with rumors that the New York Times will soon publish a scandalous exposé on the personal life of New York Gov. David Paterson. The Daily News' Elizabeth Benjamin says in her Daily Politics report that the alleged blockbuster story "will be far worse than his acknowledged extramarital affair with a former state employee."
More on the Paterson rumors

Rumors abound about Paterson-scandal Exposé [New York Magazine]

For about two weeks now, Albany has been buzzing that the New York Times was preparing a blockbuster scandal exposé about Governor Paterson, one that could seriously affect his chances for reelection. At first the rumors had it that the piece would be run last Sunday. When that day came and went, there was a lull until yesterday, when they again reached a fever pitch. The gossip fires had also been stoked by a "Page Six" report over the weekend in which the Post recounted an unpleasant alleged encounter in the governor's mansion. "At one point [a state trooper] opened the door to an electrical closet/utility room that isn't normally used," a source told columnist Fred Dicker. "The trooper opened the door and the first thing he saw was the governor and a woman inside and the two of them snuggling together, embracing. There was nothing more than that, snuggling, and they had their clothes on."

The Daily News, coincidentally, had just run a story claiming that trooper presence in the mansion had recently been reduced "after a number of incidents in which the governor and First Lady Michelle Paige Paterson were 'startled' by troopers." When State Police Superintendent Harry Corbitt wrote a letter to the Post editors denying these stories, Daily News Albany chronicler Elizabeth Benjamin saw fit to mention the exposé rumors publicly for the first time. At around the same time, Observer media reporter John Koblin tweeted that he'd been hearing the same buzz. "Anyone hearing about NYT bombshell on Paterson?" he asked. "Heard big, damanging story comin. [sic] been working for weeks, but still not published yet."

The Times hasn't run anything yet, but we hear they are definitely coming up with something big about the Paterson administration. A spokeswoman had no comment, but regardless, if these rumors continue to gain speed online or even in print, it would seem damage is already being done to Paterson. Aspiring gubernatorial candidate Andrew Cuomo, for example, can't be too chagrined about a Paterson scandal story that, like Cuomo himself, is gaining momentum by running just under the surface.

"Bombshell" to explode Governor Paterson? [Gothamist]

The rumor mill is churning right now about a "big, damaging" New York Times "bombshell" story that supposedly features some ruinous dirt about the personal life of Governor David Paterson. Elizabeth Benjamin at the Daily News hears it "will be far worse than his acknowledged extramarital affair with a former state employee." Remember when you first heard about Eliot Spitzer's involvement with prostitutes, and everyone was like, "Okay, so who the hell is David Paterson?" Well, let's get to know current Lieutenant Governor Richard Ravitch! (We would link to his official New York State website, but, heh, that doesn't even exist.) You may recall that he is old and white and not blind, and was sworn in at Peter Luger's in Brooklyn. The Wikipedia tells us his family history in New York dates back to the 19th century, he graduated Phi Beta Kappa from Columbia, and went on to Yale Law School. Ravitch was also the third generation to take over his family's construction company, and he's credited with building the first integrated housing projects in Washington, D.C. He ran the MTA from 1979 through 1983 (declining a salary), and Mayor Ed Koch once called him a "Renaissance man." It's unclear what role hookers, cocaine, and extra-marital sex play in his past, but let's not get ahead of ourselves here.

The story everybody’s talking about (but no one’s read) [Albany Times Union]

No one, that is, except for reporters, editors and lawyers at the New York Times, which has according to an avalanche of first-, second- and third-hand accounts been working on a piece about Gov. David Paterson that, depending on who you talk to, could prove to be anything from mildly embarrassing to politically apocalyptic. The last few weeks have brought two major eruptions of rumors concerning Paterson’s private life: reports of nuzzling at a New Jersey restaurant and being caught in semi-flagrante in a utility closet in the Governor’s Mansion — stories that Paterson and his press office have vehemently denied. According to sources who have actually been interviewed for the Times’ story, its central narrative is the role played by members of Paterson’s inner circle in his personal and political activities. Rumors about a possibly publication date for the story have ranged from Monday to today; the latest suggests Sunday, but it’s hard to believe that the Times would hold the story much longer when knowledge that it’s pending has put every other reporter in the Capitol and elsewhere on the scent. Possible reasons for delay include editorial fine-tuning and thorough legal review. Someday, a sociologist might be able to use an analysis of the rumors currently flying around the Capitol as their dissertation topic. Information from credible sources slowly becomes wilder as it spreads out. Sometimes, the chain of information is circular: A calls B, who calls C; then C calls A, who discovers that the story has changed markedly on its journey. The Times, of course, won a Pulitzer for breaking the story of Eliot Spitzer’s transgressions. Living in anxiety that the paper could be on the verge of dropping something of similar impact won’t make for a happy weekend at the Governor’s Mansion.

New York Times sitting on Paterson swinging bombshell? [Gawker]

The Observer's John Koblin heard the New York Times is supposedly working on a major story on our wacky governor. The guy's admitted to drugs and adultery, what else could there be? (We're all ears!) Update: More sex, looks like. The New York Daily News' Liz Benjamin points to a weird letter to the editor of the Post from the State Superintendent, who flatly denies the recent Page Six story on Paterson dining (and nuzzling) with a lady who is not his wife. And supposedly the bombshell story will make the earlier adultery revelations look tame in comparison. For what it's worth, there is a rumor that the governor and his wife are swingers. And if that is what the Times is working on, all we can say is we look forward to reading them attempt to describe the practice in the house style.

3 Lawyers and Corrections Officer Charged with Real Estate Fraud

3 lawyers and correction officer among 12 charged with real estate fraud
The New York Daily News by William Sherman - February 4, 2010

Smith for NewsKings County District Attorney Charles Hynes (l.) announce charges against 12 people for real estate and mortgage fraud in a press conference at the office of the Kings County District Attorney. A man who collected $16,250 in rent for an apartment he didn't own was among a dozen people charged Thursday with real-estate fraud in Brooklyn. Three lawyers and a city correction officer were also named in the indictments announced by Brooklyn District Attorney Charles Hynes. "There is an epidemic," Hynes said, adding the dirty dozen reaped more than $2.6 million in profits through the schemes.

The indictments charge that:

• Earl Davis placed an ad on Craigslist and collected a full year's rent in advance after giving the victim a forged lease.
• Correction Officer Margareth Blanc collected more than $30,000 in federal rent subsidies with forged applications while living in her sister's apartment.
• Deric Nelson worked a phony deed scam, making it look like he owned a building he'd already sold - then rending vacant apartments.
• Attorney Alexander Landy bought a home, took out a $500,000 mortgage, never registered the deed or the loan, and then sold the home without paying a nickel to the lender. He was able to fool the buyer's title company because there was no public record of the mortgage.
• Another lawyer, Alan Rocoff, a court-appointed referee in the sale of a church, deposited $200,000 into his own account instead of turning the money over to the court. Both Landy and Rocoff have resigned from the bar. "Ordinarily, in real estate deals, you would say, 'Get a lawyer,'" said Hynes. "Now you say, 'Get an honest lawyer.' You have to pay attention to the lawyers you hire, you have to get referrals." Jean Kemp, a victim of one scam, described how shocked she was to get a call demanding payment for a mortgage on her home - since she'd paid off the mortgage 23 years ago. "It was so scary. I was just furious," she said. It turned out that a lawyer, Jarrett Haber, and his associate, took out a $225,000 mortgage on her home without her knowledge and used that money to pay a debt in another real estate scam, the indictment said.

Governor Paterson In Full Gear Against Corruption

Paterson vetoes Legislature’s ethics bill, goo-goos unhappy
The Albany Times Union by Rick Karlin - February 2, 2010

Gov. Paterson has vetoed the Legislature’s ethics bill, saying it doesn’t go far enough: “While there are positive aspects of this legislation, it does not go far enough in addressing the corrosive effects of outside influence and internal decay that have caused the people of New York to lose faith and trust in their government,” the governor said in his veto message. First up with a response was the coalition of civics groups that have pushed for the measure, even though some admitted it was imperfect.

Here’s the statement from Citizens Union, League of Women Voters and NYPIRG: Our organizations are deeply disappointed that the governor has vetoed important ethics reform legislation. We wish that the governor has not chosen to be an obstacle to reform, but since he has taken that action we urge the legislature to move swiftly and enact the ethics reform legislation over the objections of the governor.

And from Senate Democratic Conference Leader John Sampson: “For 40 years, special-interests in Albany have prevented reform in state government. Lack of disclosure of business relationships with our lawmakers, the near non-existence of campaign finance enforcement, and millions of special-interest dollars have led us to the brink of fiscal disaster. “The ethics and campaign finance reform legislation passed with nearly unanimous, bipartisan support by both houses of the Legislature changes that. Our bill creates greater disclosure requirements for public officials, strengthens enforcement capabilities to ensure the law is upheld, and increases transparency to tear down Albany’s veil of secrecy. “To average New Yorkers struggling to keep their jobs, feed their families, and pay their bills, ethics reform might not seem that real or important. But the impact of special interest money can be felt at kitchen tables across the state. Corruption costs money. Inaction is unacceptable, and change delayed is change denied.

And here’s a rundown from the civics groups on what the bill would have accomplished:

Critical changes to executive branch ethics

Unlike previous executive branch ethics agencies, the legislation proposes that no one elected official chooses a majority of the appointments to the commission. The legislation grants to the commission the crucial power to randomly review ethics filings to ensure honesty and accuracy.

Critical changes to lobbying oversight

All state and municipal lobbyists and their clients must report business relationships with state public officials. Expands the definition of lobbying to include lobbying for resolutions. Critical changes to legislative branch ethics. The most important change is that the legislation creates an office of legislative ethics investigation. This new entity would have a board that contains no lawmakers and no lobbyists, among other restrictions. In addition, the new office has the powers necessary to fully investigate complaints.

Critical changes to campaign finance enforcement

As proposed in the legislation, the State Board of Elections (SBOE) enforcement counsel and special counsel would have four-year terms with removal only for cause. The enforcement counsel would have power to initiate investigations. The legislation requires a majority vote of the in order to stop an investigation from going forward. Determination of violation and issuance of penalties would still rest with the Board.

Critical changes to disclosure requirements

Currently, public officials are required to disclose the sources of outside income and the value of that income within ranges established in law. However, those dollar-figure ranges are redacted from public view. Under the legislation those dollar-figure ranges would become public and a new range is added from $250,000 to $1,000,000. Those required to report under the lobbying law would now have to report business relationships they may have with public officials. Such relationships are not currently disclosed. Candidates would be required, for the first time, to file disclosure with the State Board of Elections in a uniform format that would be made available to the public on-line. Expenditures by individuals or groups that are independent of the candidate, and thus were not subject to campaign finance disclosure, would be required to file disclosure that would, for the most part, mirror the disclosure of candidates. Thus, the public will know the names of those who contribute $100 or more to these groups.

Attorney General Took Cash From Opposing Attorneys

Cuomo Took Cash From Lawyers With Matters Before Him
Bloomberg News by Linda Sandler and Karen Freifeld -November 23, 2009

(Bloomberg) -- New York Attorney General Andrew Cuomo’s campaign fund took tens of thousands of dollars from law firms representing clients his office investigated or accused of wrongdoing, state records show. Boies Schiller & Flexner LLP, a New York law firm led by David Boies, gave Cuomo $35,000 this year, records show. The firm represents former American International Group Inc. Chief Executive Officer Maurice “Hank” Greenberg in a civil fraud case the attorney general is pursuing. Lawyers defending Dell Inc., Deutsche Bank AG and a former state political party chief in Cuomo cases also contributed to him, records show. Cuomo’s donation forms ask contributors to sign a statement saying they have no “matter” pending with him. That rule “does not extend to attorneys representing persons or entities with matters before the NYS Attorney General’s office,” the form states, mirroring predecessors’ policies. The exception creates the appearance of impropriety, ethics experts said. “If Cuomo doesn’t want to accept contributions that have the appearance of being corrupting, then he would need to include those attorneys as well,” said Allison Hayward, a former Federal Election Commission chief of staff and counsel who teaches legal ethics at George Mason University School of Law in Arlington, Virginia. Middlemen, such as lawyers, are sometimes seen as a bigger threat to an official’s integrity than their clients, because “they are working the political system for a profession, and the public sees them as insincere and manipulative,” she said.

About $1 Million

Cuomo in 2006 and 2008 raised about $1 million from lawyers and lobbyists in the U.S., out of a total $18 million gathered in those years, according to FollowTheMoney.org, the Web site of the nonprofit National Institute on Money in State Politics, which analyzes campaign funding. For his fund “Andrew Cuomo 2010” he raised more than $10 million as of July, according to records at the New York State Board of Elections. By the next filing due mid-January, Cuomo, 51, plans to have $20 million in donations and plans to run for governor, said a person familiar with his plans. By now, ‘Andrew Cuomo 2010’’ has $16 million to challenge fellow Democrat, Governor David Paterson, said another person familiar with his plans. Former Republican Congressman Rick Lazio, who is seeking the New York governor’s job, said today in a statement that Cuomo’s donations taken from lawyers with cases before him expose the “ethically challenged culture that exists in Albany,” the state’s political capital.

Appearance of Impropriety

“It is even more dangerous because of the Attorney General’s power to decide whether or not to prosecute or publicly destroy someone in the media,” Lazio said in the statement. “We must end the appearance of ethical impropriety in Albany and restore the people’s faith in government.” If Cuomo were to reject lawyer donations to avoid any appearance of conflict, he could still raise enough for “a credible campaign,” said Ronald Michaelson, a former national chairman of the Council of Governmental Ethics Laws who teaches at the University of Illinois at Springfield. “Even if he’s going to use the money in a gubernatorial race, he would still be the attorney general,” Michaelson said in an e-mail. “The perception of impropriety is obviously clear, and that’s reason enough to refuse the money.”

Hurt Chances

Excluding large groups of donors might make Cuomo a leader in ethics while hurting his chance to be elected, said Susan Lerner, executive director of Common Cause, New York, a nonprofit that promotes honesty in government. “People who run for office are between a rock and a hard place,” she said. “The system stinks. If you don’t want people running for office to be influenced by campaign contributions, then you have to give them public money to run.” Richard Bamberger, a Cuomo spokesman, said in an e-mail, “Lawyers appear constantly before all sorts of government agencies, whether it is the Mayor’s Office, the Governor’s Office, or countless agencies and boards. No one would argue that lawyers can’t donate to candidates for any of these offices. Indeed, the ABA and New York State rules specifically encourage lawyers to participate in the political process.”

The Rules

The American Bar Association “Model Rules” for lawyers, which don’t address attorneys general, prohibit donations made for the purpose of getting hired by judges and other government officials. Cuomo, who doesn’t hire outside lawyers, abides by that principle, Bamberger said. Except for donations made to win jobs, the commentary to the ABA rule says, “Lawyers have a right to participate fully in the political process, which includes making and soliciting political contributions to candidates for judicial and other public office.” New York State rules for attorneys allow contributions to judges or public officials as long as the recipient is allowed to accept gifts. Eliot Spitzer, attorney general from 1999 to 2006, took lawyer donations too from those with cases before him. Boies gave him $15,000 and the Boies Schiller firm gave $10,000 in 2004, according to state records. “Candidates in New York State for district attorney, judge, attorneys general, and all other offices have operated under the very same rules for decades,” Bamberger said. Spitzer, who resigned as New York State governor amid a call-girl scandal in March 2008, declined to comment.

‘A Meeting’

Peter Harvey, a partner at Patterson Belknap Webb & Tyler LLP, who attended a Nov. 18 lawyer fundraiser for Cuomo and has been a supporter since Cuomo ran for attorney general, said that supporting the attorney general means “you get a meeting.” “You get an opportunity to communicate your thoughts but that doesn’t mean the person listening is going to agree with you,” said Harvey, New Jersey’s former attorney general. In fact, he said, “because you are a supporter they will be careful not to give you any special treatment” so they can’t be accused of anything. Cuomo’s campaign chest is being swelled by lawyer donations and pledges from recent fundraisers including a Nov. 12 event at the Trump National Golf Club in Briarcliff Manor, New York, and the Nov. 18 lawyers breakfast, held at New York’s Sheraton Hotel with a requested $1,000 minimum donation. Maria Vullo of Paul Weiss Rifkind Wharton & Garrison LLP, co-chair of the “Lawyers Committee for Andrew Cuomo,” said about 200 people attended the Nov. 18 breakfast, exceeding the target in a non-election year for Cuomo. The attorney general spoke about “integrity” in state government, she said. Sponsoring firms at the event included Sullivan & Cromwell LLP and Skadden Arps Slate Meagher & Flom LLP.

Greenberg Case

Cuomo’s case against Greenberg, inherited from Spitzer, is pending in New York state court. Greenberg, pushed out by AIG’s board during a 2005 probe by Spitzer, asked a judge in September to dismiss the suit, which accused him of distorting the company’s financial condition. If the case isn’t dismissed, Cuomo could still drop or settle it, both of which would benefit Boies. Boies, who represented the U.S. Justice Department in a successful antitrust case against Microsoft Corp. and former Vice President Al Gore in a court fight to recount Florida votes in the 2000 presidential election, didn’t respond to a call and e-mail seeking comment. Spokeswoman Dawn Schneider declined to comment. New York-based Kramer Levin & Frankel LLP gave Cuomo $33,459 in 2005 and 2006 for his successful attorney general race, records show. This year at least 21 Kramer Levin partners gave Cuomo amounts of $100 to $500 each on June 3, according to state Board of Elections data.

Raymond Harding

Kramer Levin Co-Chair Gary Naftalis is representing former New York Liberal Party Chairman Raymond Harding, who pleaded guilty Oct. 6 to wrongfully taking $800,000 from investment firms that sought access to New York public pension fund money. Since 2007, Cuomo has been investigating kickbacks at the $116.5 billion state fund. Harding, who agreed to cooperate with Cuomo, eventually will be allowed to withdraw his felony plea, the judge handling the case said in court. “Our firm, like many other law firms, makes contributions to candidates whose policies we support,” said Kramer Levin Managing Partner Paul Pearlman in an e-mailed statement. “All our contributions are vetted to insure that they comply with all applicable ethical and legal standards. These contributions are not intended to have any impact whatsoever on client matters involving regulatory bodies.”

Restitution

Cuomo in 2007 sued Dell, the third-biggest personal- computer seller, accusing it of deceptively advertising financing and warranties. The company committed to pay $4 million in restitution and penalties, Cuomo said in a Sept. 15 release. Featherstonhaugh Wiley & Clyne LLP, Dell’s local counsel in Albany, New York, gave Cuomo $18,000 in 2008 and 2009, state records show. Name partner James Featherstonhaugh said he hasn’t noticed that his donations helped clients. He failed this year to win money for a client who had a ski accident at a state-owned resort that Cuomo’s office defended, Featherstonhaugh said. “I contributed because I have known him since he was 20, am an old friend of his father’s, and his brother Chris used to work for me as an intern,” Featherstonhaugh said. Cuomo’s father Mario is a former Governor of New York. Cuomo’s campaign, according to state records, took $2,500 on Dec. 15 from Philadelphia-based Morgan Lewis & Bockius LLP, which represented Deutsche Bank as Cuomo probed banks that allegedly underrated the risks of auction-rate securities.

Goldman, Merrill

Settling with Cuomo, the Frankfurt-based lender agreed to pay $15 million in penalties to state regulators, Cuomo said in August. It was one of a series of deals that made banks, including Goldman Sachs Group Inc. and Merrill Lynch & Co., return $61 billion to investors who bought illiquid securities after being told they were safe, Cuomo estimated in July. Morgan Lewis Chairman Francis Milone didn’t respond to calls and e-mails seeking comment. Chicago-based Mayer Brown LLP, which represented TD Ameritrade Holding Corp. in Cuomo’s auction-rate securities probe, gave the attorney general $2,000 on May 4, according to state records. The Omaha, Nebraska-based online brokerage agreed in July to buy back $456 million of the illiquid investments from customers, Cuomo said in a July 20 release. A Mayer Brown spokesman declined to comment or be named. Mayer Brown partner Lynn Neils, who attended the Sheraton fundraiser, said on Nov. 18, “I think he would make a great governor if he decides to run.”

Coventry First

In a September settlement with Cuomo, Philadelphia-based life insurer Coventry First LLC said it agreed to pay the state $10.5 million to end a lawsuit originally filed by Spitzer in 2006 that alleged it had defrauded policy holders. Los Angeles-based O’Melveny & Meyers LLP, Coventry’s law firm, gave Cuomo $7,500 on May 10, 2006, through a political action committee, according to state data. “We do not think that the attorney general of New York would make it any easier for lawyers or cut any slack for their clients because of the lawyers’ prior campaign contributions,” said Arthur Culvahouse Jr., the law firm’s chair, who was counsel to President Ronald Reagan in the 1980s. “That was not our thinking in 2006 or now. Indeed, as officers of the court we would not contribute to a candidate if we thought that were the case.”

‘Cost of Doing Business’

Lawyers probably regard campaign contributions as “a cost of doing business,” said Peter Henning, a former U.S. Securities and Exchange Commission senior lawyer who teaches legal ethics at Wayne State University Law School in Detroit. “They take the view that it will help us down the road.” Former New York Attorney General Dennis Vacco, who lost to Spitzer in 1998 and has a case before Cuomo, has contributed to him even though his own policy was not to take money from lawyers who had pending matters. He did accept money from such a lawyer’s firm, he said. Such an exemption, he said, might be interpreted as “splitting hairs.” To contact the reporters on this story: Karen Freifeld in New York at kfreifeld@bloomberg.net; Linda Sandler in New York at lsandler@bloomberg.net.

Disbarred NY Lawyer Who Ripped Off the Disabled Jailed

Disbarred NY Lawyer Who Ripped Off the Disabled Jailed
The New York Law Journal by Vesselin Mitev - February 1, 2010

Steven T. Rondos, the former Brooklyn attorney who pleaded guilty to stealing millions from guardianship accounts of incapacitated seniors and children, was sent to jail by a Manhattan judge on Friday while he awaits sentencing. Mr. Rondos, who had been free on $2 million bail, was indicted last year on money laundering and grand larceny charges of stealing more than $4 million from various accounts he oversaw. A probe uncovered that at least 16 court examiners had signed off on Mr. Rondos' reports without detecting any red flags. Five examiners resigned in the wake of the probe and one was suspended. Mr. Rondos, who has since been disbarred, pleaded guilty in November to all 19 counts of the indictment and was set to be sentenced to between six and 18 years. On Friday, defense attorney Franklin Rothman asked Acting Supreme Court Justice Ronald A. Zweibel to allow his client to remain free until a restitution hearing is held. Mr. Rothman told the court his client was "the last person in the world" who would run away but the court remanded Mr. Rondos until the restitution hearing, now set for Feb. 10.