Wednesday, August 12, 2009

Federal Corruption Probe Leads to Riverdale

By N. Clark Judd

Cambridge Mews, a four-square brick apartment building just off the commercial corridor of busy Riverdale Avenue, doesn’t exactly look suspicious.

The structure, which occupies about half of the block between Riverdale Avenue and Cambridge Avenue along West 236th Street, was completed last year. It sits in a neighborhood that’s been sprinkled with similar complexes in the last decade, their brick-and-mortar facades emulating older townhouses and co-ops.

But the quiet building on a quiet street plays a cameo role in a federal court indictment unsealed on Aug. 5 that alleges the head of the Carpenters Union District Council in New York City, Michael Forde, and nine others were involved in a scheme in which $1 million in bribes and gifts changed hands.

It’s not the first time on this stage for the building at 3536 Cambridge Ave. The chief financier of the building, James Murray, is already under indictment for allegedly skipping out on payments he was required to make to the union. Mr. Murray is also locally infamous for leaving the skeletal tower on Tulfan Terrace unfinished.

In exchange for bribes, prosecutors say, union officials falsified reports and turned a blind eye as contractors paid workers below the union rate, hired non-union labor at uniononly job sites, and skipped out on payments to the unions’ benefits funds.

The benefit funds provide insurance as well as money for retirement for union members.

Accused of perjuryJoseph Olivieri, a trustee of the District Council’s benefits funds and the head of a contractors’ trade group, is accused of perjuring himself when he described under oath how his own company won excavation work at the Riverdale site.

“I had met a gentleman who was doing the projects in the area,” Mr. Olivieri said under oath, according to the indictment. Prosecutors say he lied when he said he couldn’t recall the gentleman’s name.

Prosecutors also say Mr. Olivieri is associated with Louis Moscatiello, described in the indictment as a soldier in the Genovese crime family who has already pleaded guilty to being involved with racketeering in the construction trades.

Mr. Murray, the financier, is head of On Par Contracting Corp. He was indicted on fraud and embezzlement charges in 2006 for failing to make benefits payments as well as structuring his finances to hide it.

He was believed to have fled to Ireland after the indictment came, sources have said, but is now back in the United States and out on bail, with $8 million in government-seized property as his bond.

The federal government is seeking $15 million from him, alleging that money and his stake in several real estate projects — including Tulfan Terrace and Cambridge Mews — are forfeit because they are ill-gotten gains.

Court documents show Mr. Murray’s lawyer is discussing “a possible disposition” of his case with federal prosecutors.

No comment
The U.S. attorney’s office declined to comment. Mr. Murray’s lawyer did not return calls seeking comment.

It’s unclear if Mr. Murray is one of the contractors — unnamed in the indictment — who allegedly gave bribes to union figures. But, among other coincidences, the charges filed against Mr. Murray in 2006 stem from how he allegedly operated On Par, a drywall business. “Contractor #1” in the indictment from last week was a drywall contractor.

Michael Brennan, a District Council shop steward, is accused of lying about how he came to be assigned by the union to “Contractor #1” work sites on West 34th Street and another project in Times Square.

According to transcripts of earlier court depositions, On Par operated both those job sites.
If true, the alleged bribery might explain how Mr. Murray was able to build in Riverdale so quickly and cheaply, said Joseph Gordon, an engineering consultant who keeps tabs on Riverdale real estate development.

“There has to have been something, shenanigans going on between the developers and the carpenter’s union,” Mr. Gordon said of Cambridge Mews. “Because they didn’t get struck and they were using non-union labor.”

Mr. Gordon explained that the union carpenters, under normal circumstances, would have protested in front of Cambridge Mews until the construction site hired only union workers.

Low bidder
And Mr. Murray frequently under-bid other contractors on Riverdale-area projects, Mr. Gordon said, by as much as 20 percent.

His work was technically solid, said Mr. Gordon. But the word in the industry was, “there was something crazy going on with Murray.”

Indicted Aug. 5 were Mr. Forde, the head of the Carpenters Union District Council in New York City; John Greaney, business manager and president of Carpenters Local 608; Brian Hayes, a business agent and Local 608 officer; Mr. Brennan, Brian Carson, Joseph Ruocco, John Stamberger, and Michael Vivenzo, shop stewards; and Mr. Olivieri, a benefits fund trustee and the executive director of the Wall, Ceiling and Carpentry Industries of New York, a trade group representing unionized contractors.

Prosecutors also accused contractor Finbar O’Neill of helping to deliver cash to Mr. Forde.

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