The National Attorneys General Training & Research Institute

The National Attorneys General Training & Research Institute The National Attorneys General Training & Research Institute

CEPI Newsletter October 2018

This monthly compendium of news reports about corruption and ethics issues is brought to you by the Center for Ethics and Public Integrity (CEPI). Neither the National Association of Attorneys General nor the National Attorneys General Training & Research Institute express a view as to the accuracy of news accounts or affirm any position taken by the authors of the hyperlinked articles.

Cases

State

City Worker Took a $1K Bribe. Now, He'll Spend 3 Years in Prison: A former clerk in Newark, New Jersey admitted that a club owner paid him a $1,000 bribe to induce him to change a building’s certificate of occupancy to allow it to be used as a social club. Qaadir Royal was sentenced to three years in prison. Similar charges remain pending against a second code enforcement worker, Tajji Williams, who allegedly received thousands of dollars for promising to alert the same club owner about police action in the area and prioritizing his building permits. The New Jersey Attorney General’s Office charged both cases.

Accused are Getting Benefits: Connecticut has filed a civil lawsuit alleging violations of the state False Claims Act by former and current Connecticut state employees. The state is alleging that the employees participated in a scheme that bilked the state of nearly $11 million. Although Connecticut has enacted a law that allows the attorney general to request an order revoking or reducing pensions of state and municipal officials convicted of certain felonies, the employees, who have not been criminally charged or convicted, continue to receive their state pension benefits.

Massachusetts State Police Lieutenants John Giulino, David Keefe Plead Not Guilty to Overtime Theft Charges: Three Massachusetts State Police troopers, David Wilson, John Giulino, and David Keefe, have been charged by the Massachusetts Attorney General’s Office with stealing overtime pay while claiming to conduct traffic enforcement on the Massachusetts Turnpike and Metropolitan tunnels system.

For G. Steven Pigeon, a Lonely Plea Caps Decades of Political Ambition: A former county political chairman pled guilty to bribing former New York State Supreme Court Justice John A. Michalek, who pled guilty to related charges over a year ago. G. Steven Pigeon entered into a plea agreement with the New York Attorney General’s Office that subjects him to up a year in prison. Pigeon has also pled guilty to unrelated federal charges in connection with arranging illegal campaign donations to New York’s governor.

“Extraordinary Theft” By Upstate Medical Prez “Exploited University's Lax Oversight”: Dr. David R. Smith, the former president of SUNY Upstate Medical University, has pled guilty to official misconduct to resolve charges that he gave himself unauthorized pay raises of nearly $30,000 per year for six years. Smith will pay nearly $250,000 in restitution. SUNY Upstate’s former vice president, Steven Brady, previously pled guilty in connection with a scheme to obtain a similar, but smaller, unauthorized pay raises, and has already paid back $60,000 in restitution. Both cases were brought by the New York Attorney General’s Office, which media reports say picked up the case after the FBI and federal prosecutors decided not to bring charges.

Federal

Rethinking Corporate Monitors: DOJ Tells Companies To Mind Their Own Business: The U.S. Department of Justice has issued a new memorandum that is likely to reduce the use of monitors as a part of a deferred or non-prosecution agreement in cases involving corporations. Brian A. Benczkowski, the Assistant Attorney General in charge of the Justice Department’s Criminal Division, also indicated that the Department would not be replacing the “monitor czar” position that existed for several years.

With a Guilty Plea, Former Jackson County Executive Mike Sanders’ Downfall is Complete: Former Jackson County, Missouri County Executive (and former prosecutor) Mike Sanders entered a guilty plea to using $15,000 to $40,000 of campaign contributions for personal expenses.

He Was Governor Cuomo’s Closest Aide. Now He’s Going to Prison for 6 Years: Joseph Percoco, a former top advisor and confidant to New York’s governor, will spend six years in federal prison for soliciting and accepting more than $300,000 worth of bribes from company executives in exchange for taking official acts on their firms’ behalf. The bribes primarily came in the form of a “low-show” job for Percoco’s wife.

Legislation

New ‘SWAMP’ Index Ranks States on Public Corruption Laws: The Coalition for Integrity (formerly the U.S. chapter of Transparency International) has analyzed state laws setting forth the scope, independence, and power of ethics agencies; limiting and requiring the disclosure of gifts; and requiring disclosures of funding expenditures and clients by state legislators. The study, called the States With Anticorruption Measures for Public Offices (or SWAMP) Index, gives Washington state its highest marks, and North Dakota its lowest.

Ethics

Are Ethics Bonuses Ethical?: The FCPA Blog reports about a private company’s decision to provide bonuses to ethical employees, and asks several trust, ethics, and compliance experts if such bonuses are themselves ethical, or a form of bribery. (Spoiler alert: the verdict is mixed.)

Cook County Judge Reassigned After He Allegedly Called Prosecutor a ‘B–ch’: Cook County, Illinois Judge Mauricio Araujo has been reassigned after he called a female prosecutor names and implied that they may have had sex in law school. The complaints against the now-former criminal court judge were made by the Cook County State’s Attorney in a letter to the Chief Criminal Courts Judge.

Hennepin County Attorney's Office Likely to Dismiss 32 Cases After Eden Prairie Detective Falsified Search Warrant: A search warrant falsified by a detective in Hennepin County, Minnesota, has resulted in an investigation into the detective and potentially imperiled 32 other cases in which the detective was involved. The detective allegedly created a warrant that purported to authorize his search of a car, including a forged judge’s signature. The county attorney has suggested that he will dismiss charges in several cases in which the detective was a key witness.

The Besden Redemption: Laurie Besden, the Executive Director of Lawyers Concerns for Lawyers of Pennsylvania, shares her story of struggling with drug abuse, beginning during law school in the late 1990s, and culminating in several felony convictions, in spending time in jail, and by being suspended from the practice of law for several years. Besden also discusses the resources that helped her, and are available to help other lawyers who are struggling with drug abuse or mental health issues.

New Investigation of Police Misconduct Could Threaten Criminal Cases: A Dallas, Texas, criminal defense attorney’s posted images of two police officers’ disciplinary files on Facebook. The Dallas County District Attorney’s Office, which reported that it had already been aware of concerns about those officers, is said to have decided not to call them to testify in any additional cases.

Dallas Attorney Kicked Off NRA Case for Failure to Disclose $177K Sanction: Dallas, Texas, attorney William Brewer III has been removed from a federal case in the Eastern District of Virginia for not disclosing in a pro hac vice application that he had been subject to sanctions in Texas. In 2016, Brewer was fined $177,000 by a Texas state court judge for engaging in abusive litigation tactics; he nonetheless stated in his 2018 pro hac vice application that he had never been “reprimanded in any court” or had “any action in any court pertaining to [his] conduct or fitness as a member of the bar.”

International

How We Did It: the U.S. Congress’ Exposure of the Grand Scale of Global Corruption: An article at the Global Anticorruption Blog looks back at how the U.S. Senate Permanent Subcommittee on Investigations successfully identified the use of banks by corrupt foreign officials to launder the proceeds of their crimes, and passed legislation designed to close some of the loopholes they exploited.

Did Manafort Corrupt European Politicians?: The Global Anticorruption Blog also details evidence released as part of the materials associated with Paul Manafort’s plea that reflect his enlistment of senior European politicians to falsely portray Ukrainian President Victor Yanukovych’s pro-Russian, authoritarian regime as a democracy that was friendly to American and European interests. The piece notes that the Council of Europe has been the subject of similar “secret propagandizing,” including what its own investigation referred to as “caviar diplomacy” by Azerbaijan—where Azeri government officials covertly provided European MPs with thousands of dollars’ worth of caviar, luxury travel, and other expensive gifts in an effort to gain their support. As a result of its investigation, the Council suspended for life fourteen former members of the Council’s Parliamentary Assembly, forbidding them from even entering the premises.

Brazil: Mexico Dragging Feet on Odebrecht Corruption Scandal: Brazil has publically criticized Mexico for refusing to sign off on terms necessary for the exchange of information that could be used by prosecutors in Mexico to investigate Odebrecht, the Brazilian construction company that has admitted to paying $800 million in bribes in countries across Latin America. The agreement requires Mexico not to charge the cooperating witnesses/ informants who provided information to Brazilian authorities.

Woman Who Spent $21M on Luxury Goods Must Explain to Court Where Money Came From: Prosecutors and investigators in the United Kingdom have used an Unexplained Wealth Order (UWO) to require a woman from Azerbaijan to explain the source of over $50 million she used to buy homes and luxury goods. The target, Zamira Hajiyeva, was married to former International Bank of Azerbaijan chairman Jahangir Hajiyev, who was sentenced to 15 years in prison in his home country for fraud and embezzlement. This is the first use of the new UWO, and additional investigations will be launched if the case succeeds.


Amie Ely is the Director of the Center for Ethics & Public Integrity and the Editor of the CEPI Newsletter and may be reached at 202-326-6041. The CEPI Newsletter is a publication of the National Association of Attorneys General. Any use and/or copies of this newsletter in whole or part must include the customary bibliographic citation. NAAG retains copyright and all other intellectual property rights in the material presented in this publication. For content submissions or to contact the editor directly, please e-mail aely@naag.org.

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