NEW YORK CITY — Gov. Andrew Cuomo ran for office as a detail-oriented manager who would be unaffected by Albany's notorious corruption.
But on Thursday, Sept. 22, two close former aides to the two-term governor were charged in a federal corruption and bribery scheme involving hundreds of millions of dollars in state contracts.
WHAT ARE THE CHARGES ABOUT?
According to U.S. Attorney Preet Bharara, Joseph Percoco, who served as Cuomo's executive deputy secretary, solicited and accepted $315,000 in bribes that Todd Howe, a former aide to the governor who became a lobbyist, helped facilitate. Also indicted were Alain Kaloyeros, president of State University of New York Polytechnic Institute in upstate Utica. Howe pleaded guilty to multiple charges and is now cooperating with federal authorities.
WHO IS JOSEPH PERCOCO?
Cuomo once said his father, the late Gov. Mario Cuomo, considered Percoco like a "third son."
WHAT ARE PERCOCO, HOWE and KALOYEROS ACCUSED OF DOING?
According to the complaint, Percoco solicited $315,000 in bribes from energy company Competitive Power Ventures and Syracuse developer COR Development in exchange for helping them to win lucrative state contracts. Competitive Power sought an agreement from the state to buy power at its proposed power plant that would have saved the company $100 million. COR Development received an exemption from a costly labor agreement and help in freeing up $14 million in state funds.
Competitive Energy paid Percoco, who was having financial difficulties, by setting up a $90,000 per year job for his wife where she allegedly did little to no work. Howe and Percoco referred to money to be paid to Percoco's wife as "ziti," borrowing a term from "The Sopranos," the HBO series about a New Jersey mob boss.
"Keep the ziti flowing," is one way the pair discussed bribes, said Bharara.
Howe set up shell bank accounts and companies that allowed COR to funnel $35,000 in bribes to Percoco.
The second portion of the bribery scam is connected to Cuomo's $1 billion plan to revive Buffalo's economy called the "Buffalo Billion" program. According to the complaint, Howe and Kaloyeros conspired to rig the bidding process so that COR Development and another company would win hundreds of millions of dollars in contracts.
HOW DID THE INVESTIGATION START?
Bharara began looking into the Cuomo administration after the governor disbanded an ethics commission investigating corruption in Albany.
Cuomo, despite saying that the so-called Moreland Commission was independent, dismantled it after legislators agreed to a package of ethics reforms that good government groups say did not go far enough to end the historical corruption in Albany.
Bharara announce in January 2016 that he had "insufficient evidence to prove a federal crime" in his investigation of Cuomo's dismantling of the panel, but warned that his work in rooting out corruption was not yet finished.
Bharara then issued subpoenas to the Buffalo Billion project to see if donors to Cuomo's political campaign were receiving favors in the form of state contracts. In the complaint, Bharara alleges Howe asked two of the developers involved in the alleged bribery scheme to make donations to Cuomo's campaign.
HOW DOES THIS INVOLVE CUOMO?
Two of the governor's former aides are charged in the complaint and Cuomo has repeatedly praised Kaloyeros' contributions to upstate New York.
Even after the complaint was issued, Cuomo said Kaloyeros had "done a lot of good for New York" during his two decades in state government. Cuomo has not been directly implicated in any wrongdoing.
"There are no allegations of any wrongdoing or misconduct by the governor anywhere in this complaint," said Bharara at a press conference announcing the charges.
The key words in Bharara's remarks are "this complaint," and the U.S. Attorney has vowed to continue to root out corruption in the state.
WHAT HAS BHARARA DONE TO STOP CORRUPTION?
So far, Bharara has convicted the two former leaders of the state Assembly and state Senate, Sheldon Silver and Dean Skelos, respectively, on corruption charges and is currently conducting a wide-ranging probe of the fundraising practices of Mayor Bill de Blasio.
Bharara has shown no signs of stopping or that any state politician is off-limits.
WHAT DOES THE GOVERNOR SAY?
Cuomo, in a press conference following the announcement of the charges, denied having any knowledge of the schemes outlined by Bharara.
"No, I had no idea about anything that was contained in that complaint," Cuomo told reporters.
During an announcement in Buffalo, Cuomo said he was fighting against the sort of allegations outlined in the complaint.
"The central point of my administration has always been about public integrity and zero tolerance for any waste, fraud, or abuse," Cuomo said.
The governor also spoke of feeling betrayed as a result of the "disturbing and reprehensible" charges and "misdeeds" the complaint alleges.
"It was an emotional day for me," he said. "It was emotional because it was a longtime friend and I was tremendously disappointed."
Cuomo said he has known Percoco for 25 years and that Percoco had started working for his father when he was 19 years old.
"It’s the first time since we lost my father that I didn’t miss him being here yesterday because it would’ve broken his heart," Cuomo said.
Despite the alleged corruption around the Buffalo Billion program, Cuomo announced it would continue.
"I want you to know, personally, that these charges against these nine individuals will have absolutely nothing to do with the energy, and the progress, and the momentum of Western New York’s revitalization under the Buffalo Billion project," he said.
Kaloyeros was suspended without pay when the complaint was revealed and the Buffalo Billion project was turned over to the Empire State Development Corporation, headed by Cuomo ally Howard Zemsky.
The governor said Zemsky will propose a second phase of the economic development initiative by the time his January State of the State speech rolls around.
In light of the bid rigging charges in the complaint, Cuomo said changes to the SUNY's procurement process, recommended by a former prosecutor Cuomo hired to review the project, will be implemented.
"[Zemsky's] first mission is to learn from what happened and to see how we can improve the system to make sure that it never happens again," Cuomo said. "I want the taxpayers of New York to know that every dollar is guarded and guarded professionally."
If Cuomo plans to run for a third term in 2018, the charges against his former aides could hurt his re-election hopes and embolden rumored possible challengers such as state Attorney General Eric Schneiderman.