January 12, 2005: Hard to believe the first half of the first decade of the new
century is almost over. Remember Millennium dread? The fear that
computers would crash worldwide, leaving us stumbling in the dark
and fruitlessly punching keys of dead ATMs? In Connecticut, the
Millennium bogey drove X Governor John Rowland's X aide Lawrence
Alibozek, to want his graft paid in gold coins. Which he buried
in his backyard. The feds eventually disinterred Larry's
treasure. Yo ho ho and a bottle of rum!
Speaking yo ho 'twas only a little over a year ago that Patty
Rowland read her rewritten version of "The Night Before
Christmas" to a rapt Chamber of Commerce in Middlesex, Conn.
Metaphorically laying her finger on the side of her nose and
blaming the evil newsmedia for spreading lies re her hubby. Yet
on the day before this last Christmas Eve, John Rowland pled
guilty to one charge of corruption. Thereby dodging a Santa sack
of potential tsoras. Back when Connecticut's Homeland Security
Director Vincent DeRosa was Rowland's state trooper chauffeur, he
allegedly witnessed the Guv cutting deals with cronies. Over the
last year X Director DeRosa was getting chatty with the feds.
Supposedly Rowland didn't want him to do likewise in court and
tossed in the tea towel. Rowland might even do a few months!
Hopefully his buds will be able to install a hot tub in his cell.
If Rowland should turn talkative about how he and his crew turned
the state house into their bitch, Patty could rewrite his prose.
Into the Valley of Graft rode the umpteen hundred?
On the same day Rowland pled out, Alexander Salvagno and his
father Raul of AAR Contractor were awarded lengthy prison
sentences in federal court in Syracuse, New York. What the EPA
calls the biggest case of environmental fraud in U.S. history
closed with a bang. Temporarily. Appeals are in the wings. The
AAR case involved asbestos abatement fraud in myriad public
and private buildings across New York State. One notable AAR
project was the Capital Building in Albany. AAR's workers? As
a 03/08/04 Syracuse Post-Standard headline put it: "Asbestos
Worker tasted it, choked on it".
As ever, the topic of Alex Salvagno and AAR continues to draw
QT mail. One recent correspondent lays the main blame not on the
Salvagnos but on the various government agencies, both federal
and state, that didn't bring the oversight hammer down on AAR
earlier. The writer has a point. AAR was one of the most
successful environmental abatement companies in New York State--
due in part to lower than average bids. They defrauded the public
for a decade. But while it's true the AAR ball was noticeably
fumbled by assorted government entities, the prime responsibility
for the fraud still lies with the individuals who devised it.
According to many accounts, Alex Salvagno never intended AAR to
be an honest enterprise. With fraud in mind, he set up his
"independent" testing facility Analytical Laboratories of Albany
(ALA). ALA not only provided false abatement verifications for
AAR, but other companies as well. The AAR story is not about a
hard working contractor pushed to cut corners in order to low
bid, but a sophisticated criminal operation run by a bright, well
connected guy with a taste for doing things grifter style.
On December 23rd, the Albany Times Union covered the Salvagno
sentencing and John Rowland's guilty plea on adjoining pages.
With photos. The two men, both of whom sullied state houses
(albeit in different ways) look as if they were separated at
birth. Both are middle aged and stocky. In the photos, both face
the camera and hunch into their coats. Their faces wear an almost
identical expression; lips pressed together as if holding back
outrage over the injustice being done THEM.
Main Street grifters with Ubermensch delusions (MSGUD) are
increasingly common. Like orcs, they may be hybrids. Possibly the
result of cross breeding between Screwdasystem Man of the Counter
Culture Age, and Greedisgood Man from the Neocon Period. MSGUD
can be found rampaging across the land. Often in the halls of
government and real estate. Some MSGUD multi task. X Governor
Rowland dabbled in mortgage flips when he was a state rep hanging
in Washington D.C. In Springfield, Massachusetts (birthplace of
basketball) dicey mortgage deals by political insiders are one
subject of a larger federal investigation into local municipal
corruption. In Los Angeles, the cozy relationship between Mayor
Jim Hahn and developers Mark Abrams and Charles Fitzgerald,
alleged partners in a massive Beverly Hills mortgage fraud, is
generating heat. In Miami, Florida, X City Commissioner Humberto
Hernandez did the mortgage fraud mambo right into jail. To be
followed by suspended Commissioner Arthur Teele, charged with
trading construction contracts for bribes when he headed the
Community Redevelopment Agency. (Note: MSGUD often lurch in such
agencies-- driven by their never ending need for HUD bux.) When
the law came looking for MSG Teele he allegedly went full
throttle UD and tried to run a cop off the road. Before
threatening to shoot him.
MSGUDs are becoming more and more violent. Over the last year the
national mortgage industry has been marked by a string of violent
deaths connected to unraveling frauds. Such was the case with
Thomas Fazy, an Oak Forest, Illinois, mortgage broker gunned
down in his office on December 8th while his co-workers took
a 20 minute dinner break. Fazy had a long record as a convicted
mortgage crook. Recently, he'd been part of a ring that flipped
decrepit properties in Chicago's poor nabes. The ring used fake
ID's to buy properties back from themselves at inflated prices.
Leaving banks and neighborhoods holding the bag. When the scam
collapsed Fazy turned state's evidence against his cohorts. Some
say that's why Fazy will never flip again.
Chicago is also the place where an investigation into a string of
gang related murders led the feds to launch "Operation: This Old
House". The investigation expanded into mortgage fraud territory
when it emerged that the same gangs who were dealing drugs and
doing rivals (30 dead bodies by 10/04) had allegedly laundered
some $70 million in profits through more than 100 fraudulent
mortgages. Proving that boys in the hood are no less canny
about unreal real estate than MSGUD.
The good news front: despite a scandal that erupted last spring
in Cleveland, Ohio about a $21.2 million home rehab fraud in the
HUD funded Repair-a-Home (RAH) and Senior Housing Assistance
programs, it looks as if the culprits were just a couple of
building inspectors and contractors. And as Mayor Jane Campbell
told the Plain Dealer (01/04/05) in relation to another case
of bribery involving one of these inspectors, the city has
"disciplined the individual and streamlined the process." The
permit process that is. More good: in 2003, the U.S. Department
of Housing and Urban Development (HUD!) wanted Cleveland to
return $11.6 million of money supposedly misspent in the city's
"Empowerment Zone" program. Empowerment Zones are meant to create
jobs in high poverty areas via business incentives such as loans
and grants. HUD believed Cleveland Zone loans and grants weren't
producing enough jobs. And that the jobs being produced went to
people living outside the Zones. But thanks to former U.S.
Representative Louis Stokes, HUD adjusted that $11.6 million
payback sum downward into the comfort zone. To a little over
one hundred thousand.
Back when Stokes sat on a congressional subcommittee overseeing
HUD, he was a force behind Cleveland getting Empowerment Zones.
So when the municipal administration paid Stokes a $150,000
consulting fee to argue their case before HUD they were getting
a staunch champion. One thing HUD objected to was that some of
the new Zone jobs were really only the old ones of Cuyahoga
County outreach workers. Who were transferred into a new office
building built within an Empowerment Zone with Zone dollars.
But Stokes convinced HUD the investment was legit because it
brought more social services into a high poverty Zone. Is
that empowerment-- or what?
The person in Ohio who sent QT the Plain Dealer article thinks
apathy is the reason people shrug off misuse of HUD funds.
(Speaking theoretically since nothing is amiss in Ohio.) It may
also be a form of passive complicity. As HUD's mission keeps
expanding, more people develop a stake in keeping local HUD Bux
flowing. Since they fear that scrutiny of one program will spread
to others. It's as if HUD were leading more and more people to
carry water for MSGUD.
One last thing. New Yorkers should keep watching the Erie Canal.
Rumors of alien abductions at SUNY just keep getting weirder.
Carola Von Hoffmannstahl-Solomonoff
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