Don’t cry for the PBA six
February 2, 1998
Anyone wondering where the feds' investigation into the city's police unions is heading might look to the top levels of the Patrolmen's Benevolent Association.
That's First Vice President Doc Savage, Financial Secretaries Bruce Robertson and Bill Genet, former Second Vice President Ed Haggerty and Trustees Bill Gamble and Len Weber. Let's call them the PBA Six.
All six lived in the city in 1993 when Ron Reale, PBA president of the transit police, ran for public advocate and scammed city taxpayers into reimbursing his contributors with matching city funds.
Reale and Richie Hartman, the former PBA attorney, labor consultant and insurance agent extraordinaire, were convicted last week of conspiring to defraud the city's campaign-finance board.
Hartman also was convicted of looting the Transit PBA of hundreds of thousands of dollars. Convicted with him were attorneys Jim Lysaght and Peter Kramer, who (with Hartman as silent partner) represented both the Transit and the Big Daddy of PBAs, the 30,000-member NYPD.
Lysaght and Kramer assumed Hartman's law practice after Hartman "borrowed" hundreds of thousands of dollars in PBA escrow funds to feed his gargantuan gambling hunger. Then-PBA president Phil Caruso then allowed him to earn $2 million a year selling MetLife insurance policies to members. Caruso paid him another $2 million as PBA labor consultant.
Here is how Reale and Hartman conspired to rip off the Campaign Finance Board and why the PBA Six may be part of the conspiracy.
New York City's campaign-finance law states that candidates for public office receive matching funds for each contribution up to $1,000 from city residents. Non-city residents don't count, which is apparently why Caruso, then-treasurer Lou Matarazzo and board members Tom Velotti, Richie O'Neil, Jim Higgins, Frank Tuscano and Ron DeVito didn't contribute.
Between June 12 and July 13, 1993, the PBA Six and / or their wives, children, stepchildren, brothers, sisters, friends and friends of friends wrote 24 checks of $1,000 each to the "Friends of Ron Reale."
As Second VP Haggerty's sister Margaret Orr testified when asked by prosecutor Michelle Hirshman whose idea it was to write her $1,000 check: "My darling brother."
"What is that darling brother's name?" Hirshman asked.
"Edward," Orr said.
Meanwhile, between June 1 and July 12, each contributor deposited $1,000 in hundred-dollar bills into his or her bank account.
During that time, two checks were written to Lysaght and Kramer. The first, for $35,000, came from the Transit PBA's general fund and noted the money was to research the Americans with Disabilities Act. The second, for $25,000, came from the union's life-insurance fund. It, too, noted research.
Lysaght and Kramer could produce no records to support such work. Transit PBA treasurer Raymond Montoro, who pleaded guilty to corruption charges, testified Hartman told him the second check was to repay contributors. The day he was subpoenaed to testify, another contributor, Zlatko Lipovac, a friend of trustee Weber and the owner of a sporting-goods store in Astoria, was offered $10,000 to provide the PBA with T-shirts for its convention.
Two days after the guilty verdicts, U.S. Attorney Mary Jo White announced that the former president of the Housing PBA, Jack Jordan, another $1,000 contributor, had pleaded guilty to perjury in the scam.
The PBA Six and lawyer Diarmuid White weren't talking last week. PBA spokesman Joe Mancini said bravely, "The PBA has nothing to hide or fear from the federal investigation."
Hartman, meanwhile, the linchpin of the PBA and the Rosetta stone of municipal corruption, was, until his gambling consumed him, legendary for his dedication and generosity. Two decades ago, this reporter watched him work literally around the clock in his second-floor walk-up office in Mineola, earning Nassau and Suffolk County cops the highest pay scales in the country.
"Write what you want," he said last week. "Whatever you write is fine. I love you."
Bratton's appellation of mayoral spokeswoman Cristyne Lategano as "Madame DeFarge" first appeared in this column.
© 1998 Newsday, Inc. Reprinted with permission.