The Dean of the Senate

The Dean of the Senate

The Dean of the Senate
February 12, 2015

With all the focus on Shelly Silver and his Assembly apparatchiks, let’s not forget New York’s state Senate, where four of the last five majority leaders have been indicted and the fifth, Dean Skelos, is reportedly under investigation.

The first, Joe Bruno, got his conviction overturned because the U.S. Supreme Court significantly narrowed the “honest services” he owed his constituents, excluding the $3.2 million in conflict-of-interest consulting fees he collected from clients with public business before him. Pedro Espada was forced to resign as leader the same day he was indicted for embezzling hundreds of thousands from a state-funded nonprofit, using $49,000, for example, to make a down payment on a Bentley. Malcolm Smith, who thought cash bribes were the quickest way to buy himself a ballot line for mayor, is now facing 45 years in prison. And John Sampson, who succeeded Smith, will soon go to trial for stealing $400,000 from foreclosure accounts and trying to get a list of the witnesses against him so he could, as he put it, “take them out.” He wasn’t looking for dates.

As one measure of how interlocked this two-house degeneration is, Frank Seddio, the former assemblyman who’s now the boss of the Brooklyn Democratic party and played a pivotal role in the elevation of new speaker Carl Heastie, took credit for Sampson’s 2014 re-election, running the indicted senator’s campaign out of his own Canarsie club.

The swamp is so deeply bi-partisan that Democrat Smith was bribing Republican county leaders to get the Republican line, Democrat Espada was initially installed as leader by Republicans, and Bruno, who claimed years ago that Silver’s outside income inspired his own consulting career, just derided Silver’s prosecutors as “out of control.”

In fact, the partner in Skelos’ law firm that runs its lobbying operation is Arthur Kremer, the former Democratic chair of the Assembly Ways and Means Committee who ran for speaker in the '80s, lost to Mel Miller and quit. Miller was subsequently convicted of stealing $300,000 from his law clients but, like Bruno, got his conviction overturned on a re-interpretation of a statute. Within minutes of the 1991 conviction that automatically cost him the speakership, Miller told reporters in the hallway of the courthouse that “maybe I’ll make some real money now.” Prophetically anticipating his new career as a lobbyist, Miller now works at the firm headed by former Republican U.S. Sen. Al D’Amato, a tawdry pillar of the insider commercial party that actually rules New York.

Criminal charges have become so routine in Albany that the Senate Republicans just re-elected Tom Libous as deputy majority leader without so much as a word of public criticism. U.S. Attorney Preet Bharara has already indicted Libous and just convicted his son. After both of those indictments were announced, Bharara raided Libous’ house to get his wife’s computer and records. Grandchildren might be next. Yet Libous got the judge to postpone his trial until July, so he could complete the ongoing legislative session (how could we do it without him?). While the Democrats actually stripped Sampson of his committees and barred him from their caucus, Skelos anointed Libous once again as their second most powerful leader.

Of course numerous other senators have been nailed in recent years, including Carl Kruger, who chaired the Senate budget committee, where billions are bartered.

It is comforting to note that local comedian Al Sharpton hosted new speaker Heastie at his National Action Network over the weekend and declared that any attempt to change the three-men-in-a-room nirvana in Albany would now be seen as racist. Along with a prayer blessing for Heastie, Sharpton issued a threat: “If you mess with Carl, you’re messing with us.”

“Don’t talk about breaking up the trio now. We just got into the trio,” Sharpton said, forgetting that Smith, Sampson and ex-governor David Paterson were recently part of the three, actually outnumbering white men at one point. It’s hard to believe Sharpton might’ve forgotten Paterson, Smith and Sampson, since all were involved with him in the Aqueduct scandal, with Sharpton collecting $100,000 in NAN contributions from bidders on the $3 billion, 30-year racino contract, the richest in state history.

We haven’t heard from the Greeks yet about what they will do if they lose their man in the room, Dean Skelos, the state senator from Rockville Centre in Long Island who succeeded Bruno. Hemlock is always an option. Jonathan Dienst, the Emmy-Award winning WNBC reporter who broke the Skelos story, says Bharara is investigating the majority leader’s ties to the real estate industry. The Real Deal says that the law firm that pays Skelos up to $250,000 a year, Ruskin Moscou, “is not part of the investigation,” which, if true, gives the probe an air of mystery.

The only known conflict of interest involving Skelos and the Ruskin firm occurred in 2006 when Skelos, as deputy majority leader, fought an Assembly bill that sought to legalize whistleblower suits against the health care providers that Ruskin represents. Skelos was described as “the most outspoken opponent” of the whistleblower provision, denouncing them and their lawyers as “bounty hunters,” and he successfully blocked it until the Democrats took over the Senate in 2009.

Though Skelos said then that he had nothing to do with the firm’s representation of the health care companies, he headlined a dinner panel at the firm’s offices for the leaders of 70 providers a few months after the whistleblower section of the bill was killed. The Ruskin website said he discussed the “road to the new legislation,” detailing the other new compliance requirements, which were prompted by a scathing federal report about the lack of Medicaid monitoring in the state. Of course, the ethics question was not whether he personally represented the providers. It was the transparent fact that his obstruction of the whistleblower provision served his firm’s interests. 

Beyond the law firm, Skelos does have one other known connection to real estate. His son Adam has been selling title insurance for years, a business rooted in connections that went utterly unregulated in New York until 2014. A month before Bruno announced he’d step aside for Skelos in 2008, a Long Island-based title company, Liberty Title, gave the young Skelos his first job as an agent.

As part of the budget deal last April that closed the Moreland Commission, the governor got the recalcitrant Senate to finally pass a bill requiring the licensing and vetting of title agents, leaving Kentucky as the only state left that doesn’t license them. The Senate’s insurance committee had long favored such a bill, but couldn’t get it to the floor. New Yorkers pay more for title insurance than anyone else in the country.

Liberty’s President Bruce Madden was arrested a year after Adam Skelos was hired, and the company shut down. Adam’s job history prior to his Liberty hiring included stints in Gov. George Pataki’s regional office and the Long Island Power Authority, as well as a gig as an executive assistant with lobbying firm Davidoff Malito and an event coordinator at the Bridgeview Yacht Club, where super-lobbyist Al D’Amato proposed to his second wife at a birthday party he’d organized.

It’s not hard to see the helpful hand of his father in one job after another. The Davidoff firm, for example, is so close to Skelos it regularly donates to him and hosted a major fundraiser for the senator’s brother Peter, an appellate division judge re-elected in 2012. In last year’s Senate races, the firm filed an exquisitely timed and damning lawsuit against a former partner who was also a Democratic Senate candidate, delivering the seat to Skelos’ majority. Even when Liberty closed in 2009, Adam picked up some part-time work on Mayor Bloomberg’s re-election campaign, another patriarchal dividend.

Adam is now with East Coast Abstract (ECA), another Long Island firm that handles title insurance for such Manhattan giants as The Feil Organization. A $7 billion developer, Feil owns 26 million square feet of office space, and recently signed a headquarters lease with the state’s Department of Motor Vehicles at a rate exceeding the advertised $46 per square foot for the midtown building. The ECA website says that account executive Skelos has been a “major success in delivering multi-million dollar commercial and residential closings to the firm.”

Perhaps the most intriguing part of this bio is that Adam was with Liberty when one of its biggest clients was Extell, the Manhattan colossus that just sold the most expensive apartment in city history for $100 million. It has also been recently reported that Bharara is probing Extell, which managed to get state tax credits for its 1,000-foot-tall tower, One57, that’s already sold a billion dollars worth of condos and is only half sold. Liberty’s Madden in fact pleaded guilty to stealing a half million of escrow funds on this tower, and another $2 million on a second Extell building. In 2011, Madden was sentenced to 20 months in jail and required by Bharara to pay $5.7 million in restitution.

Madden and Liberty contributed $4,000 to Skelos’ Senate committee in 2007 and 2008, and $25,000 to the Senate Republican Campaign Committee shortly after Skelos ascended to majority leader. Gary Barnett, the CEO of Extell, kicked in another $10,000 to SRCC. Barnett’s was the largest contribution the committee received in that cycle, and Madden’s was one of the largest in the earlier cycle.

While there’s no indication that these overlapping relationships are part of the Skelos investigation, they raise questions like those posed by the Libous indictment, which involved the senator’s efforts to land his son Matthew a job (the Silver case as well includes a job he got for the son of the doctor who was referring asbestos cases to his firm). Libous is charged with lying to the FBI about his own role in securing a job with a Westchester law firm for Matthew, including efforts to get a lobbyist to pay the firm $50,000 to boost his son’s salary. The raid for the computer and records of Frances Libous, the senator’s wife and member of the Workers Compensation Board until recently, appear connected to her ties to a real estate company that at one point included her and her husband as partners.

The company owns 230 acres near Albany that it’s leasing to a hydrofracking firm and Libous has been fracking’s top champion in the Senate, blocking an Assembly two-year ban on it. Partnering with the contractor that built their upstate lakefront house and is a substantial donor to the senator, Frances Libous incorporated the real estate firm, though it’s unclear how long she and her husband were tied to it. The FBI has questioned another contractor who worked on the Libous home. “It was something about corruption,” the contractor told a reporter.

With Matthew Libous convicted and facing sentencing, the senator awaiting a July trial and the threat of a case against his wife, Libous is presumably feeling the heat to cooperate. He and his wife have cancer. He’s drained his campaign committee, paying four criminal attorneys, and only has a $527,000 balance, down almost $200,000 from a year ago. But his lawyer, Paul DerOhannesian, says “there’s no likelihood” of his cooperating, “no reason to believe otherwise,” and “no pressure.”

Combine the circumstances of Libous’s predicament with the fact that no one in the Senate has worked as closely with Skelos as Libous and you have to wonder if the always grim Skelos is now sweating. Should Skelos be indicted and Libous convicted, the Senate Republican leadership itself will be up for grabs.               

It’s a job with the highest prosecution rate in the state.

 

Wayne Barrett has covered New York politics for decades, primarily at the Village Voice. 

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Wayne Barrett
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