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Catsimatidis Blasts 'Culture of Corruption' as Aide Busted in Bribery Plot

By  Jill Colvin Aidan Gardiner and Jeff Mays | April 2, 2013 1:14pm | Updated on April 3, 2013 1:15pm

NEW YORK CITY — A close aide to John Catsimatidis, the billionaire Republican mayoral candidate, was ensnared in a sweeping alleged bribery and fraud scheme to put Democratic State Sen. Malcolm Smith on the GOP's 2013 mayoral ballot, sending ripples through the city's political world.

Vincent Tabone, a Catsimatidis aide and vice chairman of the Queens Republican party, was arrested by FBI agents Tuesday morning along with Smith, City Councilman Dan Halloran, the chairman of the Bronx GOP, and two other officials in the broad bribery plot.

"The arrests this morning point to a culture of corruption that permeates our city and state — corruption fueled by career politicians who put personal advancement before public service," Catsimatidis said in a statement.

"Earlier this year we learned that an investigation was underway and since that time my campaign and my business have fully cooperated with law enforcement," the candidate added.

Later in the day, Catsimatidis refused to say anything more when asked about his knowledge of the bribery scheme when a DNAinfo.com New York reporter confronted him outside his apartment.

Smith hoped to snatch the city's highest office by getting on the Republican ticket without switching his party, officials said. In order to do so, three of the city's five borough party leaders needed to support him. Smith bribed party officials, including Tabone, to get their support, according to the criminal complaint against him and the other defendants.

Tabone, who is the second-in-charge of the Queens GOP, allegedly accepted $25,000 in bribes and was promised an additional $25,000 to help secure Smith's spot on the GOP ballot.

Halloran, of Queens, acted as a liaison between Smith and GOP party officials while also lining his own pockets during the process, documents charge. Many of the bribes were masked as accounting and legal fees, according to the criminal complaint.

Catsimatidis gave Tabone $3,000 on Feb. 16, two days after the aide took a hefty cash bribe from an undercover FBI agent posing as a real estate developer, campaign finance records show.

Catsimatidis' staffers said Tabone's actions— working for the supermarket magnate and his political campaign while trying to help Smith get on the ballot— were disgraceful.

“This is a betrayal of Shakespearean proportions. Someone who you trust, who works for you is in fact double dealing and trying to get another party on the Republican ballot. All that can be said is that it’s sad," aide Rob Ryan said.

Republican mayoral hopeful and former MTA chief Joseph Lhota released a statement Wednesday praising federal authorities for "rooting out corruption and prosecuting violators of the public’s trust to the fullest extent of the law.

"When convicted, they should not only be incarcerated but they should also be stripped of any public pensions," Lhota continued. "I personally don’t believe in degrees of integrity: you either have it or you don’t."

The arrests come as a blow because Lhota had recently secured a coveted endorsement from Joseph Savino, the Bronx GOP chairman who was also arrested Tuesday, over Catsimatidis, according to the Bronx Times.

"These allegations represent a reprehensible abuse of the public's trust," City Council Speaker and Democratic mayoral candidate Christine Quinn said in a statement. "If true, then the full weight of the legal system should be brought to bear on all parties implicated."

The City Council's Standards and Ethics Committee will also investigate the scheme, Quinn said.

Mayor Michael Bloomberg blamed the scandal on the city's partisan elections. In 2005, Bloomberg spent $7 million of his own money to try and convert the city's electoral system to non-partisan.

"We are the only big city in the country that has partisan elections — the only one," Bloomberg said.

"But generally speaking, partisan elections deprive the public of the right to pick their own leaders, because the only people that vote in the only election that matter are the fringe group of whether it's one party or another party," added Bloomberg. "And maybe they make good choices; maybe they don't."

Halloran's office released a statement denying the allegations.

"When the full story comes out, he is confident that he will be vindicated," Halloran's spokesman said.

In a statement, Smith spokesman Todd Shapiro said his boss would be "vindicated when all the facts in the case are revealed."

A woman who identified herself as Queens GOP Chairman Phil Ragusa's wife said he wasn't at home and "doesn't know anything," about the indictments.

"We heard it on the radio this morning," she said.

The indictment against Smith mentions that he and an FBI undercover agent and a confidential informant were planning a meeting with the "New York State Senator who represents the Spring Valley, New York area."

U.S. Attorney Preet Bharara said Sen. David Carlucci was not involved in the scheme.

Carlucci issued a statement.

“Like many New Yorkers, I am shocked and outraged over the alleged misconduct undertaken by various public officials at the state, city, and local government," Carlucci said.

“As the United States Attorney had indicated, in no way whatsoever was I, or any member of my staff, involved in the alleged criminal misconduct and subsequent charges filed this morning.  On the contrary, these actions speak to a broader, more fundamental reason as to why I ran for office in the first place — to clean up the culture of corruption that pervades our politics," he added.

The calls for Smith's resignation also began on Tuesday.

Sen. Daniel Squadron, who represents Manhattan and Brooklyn, called for Smith to step down.

"The charges outlined in today's complaint are simply shocking. This is something that belongs in 'House of Cards,' not an election to decide who will run our city or any part of our government," Squadron said in a statement.

"Regardless of the outcome of the criminal charges filed against Senator Smith, he has lost the public trust — and he should resign."

The city's mayoral candidates also weighed in.

"Sadly, today's news is the latest in a long line of wrong and improper use of discretionary funds.  To restore the public trust, we need a real investigation into this troubling pattern of abusing taxpayer dollars for political gain. It's time for real reform and transparency," said Public Advocate and mayoral candidate Bill de Blasio.

Fellow mayoral candidate Bill Thompson agreed.

“These charges are extremely troubling, particularly because they involve the use of taxpayer dollars to advance corruption," Thompson said.

Even Comptroller John Liu, who himself was the subject of a federal investigation into his fundraising efforts, weighed in.

“The news this morning is shocking. When there is suspicion that taxpayers’ money is being abused investigations should be carried out quickly and thoroughly," Liu said.

Another mayoral candidate, Sal Albanese, said that the bribery charges are part of a systemic problem that makes it too easy for elected officials to gorge themselves on public funds and that campaign finance laws should be strengthened.

"The biggest mistake we can make is to assume that these are just a 'couple of bad apples.' Their pay-to-play mentality is a systemic problem, and it's directly harming regular New Yorkers," Albanese said in a statement.

Smith will continue to hold his office, but the leader of the Independent Democratic Conference, Jeffrey D. Klein, announced that the senator would be stripped of his committee appointments.

"These are very serious allegations that, if true, constitute a clear breach of the public trust," Klein said in a statement. "Given the level of criminality alleged, I believe that Senator Smith should seriously consider whether or not he can continue to effectively serve his constituents."

In Albany, Senate Republican leader Dean Skelos said in a statement that the "allegations outlined today involving Malcolm Smith are extremely troubling.

"I concur with the swift decision made by Independent Democratic Leader Jeff Klein to strip him of his committee assignments and his conference leadership position," Skelos added.

Ewa Kern-Jedrychowska contributed reporting.