Background Checks Too Expensive for All Contractors, Bloomberg Says
CITY HALL — Background checks that would prevent ex-cons from getting lucrative city sub-contracts are too expensive, Mayor Michael Bloomberg said Thursday.
As DNAinfo.com New York's On the Inside reported, the city doesn't require agencies to conduct background checks when they're awarding sub-contracts for less that $100,000.
That means ex-cons like Nicholas Analitis, who served three years in prison for passing bad checks and ripping off banks, was able to land hundreds of thousands of dollars worth of contracts with the Parks Department — despite his checkered history.
Analitis is now accused of swindling his workers out of tens of thousands of dollars by paying them with phony checks.
But Bloomberg said that requiring background checks on every person looking to do business with the city wouldn't be worth the cost.
“We have so many contracts. It would cost us a fortune to have an investigator in every time,” he said at an unrelated press conference in Brooklyn, arguing that it makes sense to have an exemption when contracts are small.
“Yes, people will get contracts you wish they didn’t," Bloomberg added. "But the cost of every kind of investigation or regulation is substantial. And eventually, you’re spending all your money on regulation."
Analitis’ criminal history is immediately apparent in an online search of the New York State Unified Court System's public database.
The city’s Procurement Policy Board leaves it up to contracting agencies — in this case the Parks Department — to scrutinize the companies they hire. But the PPB’s protocols do not explicitly insist on background checks for contractors, sources said.
In November 2010, Analitis, fresh out of state prison, created a new company and officially applied for work with the city. As required, he filled out a detailed Vendex questionnaire provided by the Mayor’s Office of Contract Services.
The Vendex system was created years ago to weed out businesses linked to criminals or organized crime and prevent them from getting taxpayer-funded projects.
But when it comes to contracts under $100,000, the accuracy of the questionnaire's answers rely solely on the honesty of the applicant and do not receive a complete independent review, sources said.
Analitis took advantage of this loophole and failed to mention his history of fraud and prison time. As a result, sources said he was soon hired as a sub-contractor on two worksites, one in Marcus Garvey park in Harlem and another repairing the Coney Island boardwalk.
“Who knows how many more criminals are working for the city when they should not?” a law enforcement source said.
The Parks Department did not return calls and email requests for comment.