Senate leader surrenders to federal authorities on corruption charges

May 4, 2015

The leader of the State Senate, Dean Skelos, surrendered to federal authorities Monday morning and was charged with six counts of corruption, including bribery and extortion, in connection with an alleged scheme that used his political position to enrich himself and his son.

The complaint, by U.S. Attorney Preet Bharara, alleges the Senate majority leader used his influence in Albany to extort hundreds of thousands of dollars in payments to his son from a real estate developer and a related environmental company. In exchange, Skelos protected the companies’ business interests at the Capitol, including renewal of the New York City rent regulations and related property tax breaks for large developers.

Bharara paints Adam Skelos as a man financially dependent on his father and he says the two Skelos’ “worked as a team” to “illegally monetize” the senator's power to take care of Adam’s “financial needs.”

Senate leader Dean Skelos faces corruption charges in connection with an alleged scheme where he used his political position to enrich himself and his son.
Credit nysenate.gov

Bharara says, as a result, Skelos’ decisions were “often based not on what was good for his constituents, or good for New York.”

“Rather,” said Bahrara.  “On what was good for his son’s bank accounts.”  

The charges state that, as early as 2010, an unnamed real estate  developer, who is also a cooperating witness in the case, made a one-time $20,000 payment to Adam Skelos for work that federal investigators say he did not do. The payments then continued, at $4,000 per month, disguised through a company that the developer had a financial  interest in.

The company, an environmental services firm, makes storm sewer cleaners and was seeking a lucrative contract with Nassau County on Long Island, where Skelos lives, to help with clean up after Superstorm Sandy. Adam Skelos shepherded the company through the process, even though Skelos’ son admitted that he “literally knew nothing about water.” 

At one point, it is charged, Senator Skelos threatened to block the contract unless payments to his son were increased to $10,000 a month.  

The complaint alleges that Adam Skelos was also paid tens of thousands of dollars from companies that had contributed to Senator Skelos' campaign and that had business before the state. Some of those firms were title insurance companies that Skelos steered to his son from the Senate leader’s work at a private law firm.  

The U.S. Attorney also charges that Skelos was paid $2.6 million by the law firm, of which he was “of counsel,” but did not perform any actual work for them, paid for referring clients to the firm who had business before the state, and meeting with law firm clients “including about legislative matters.”

The complaint says Skelos also pressed to get hydraulic fracturing made legal in New York, which the environmental company was interested in, to treat fracking wastewater. But ultimately Skelos failed in that when Governor Andrew Cuomo banned fracking in New York.

The complaint says Skelos and his son attempted to cover up their actions, as it became clear that the federal authorities were onto corruption at the Capitol. It says they doctored documents to hide the true nature of the $20,000 payment  from the developer to Adam Skelos.

They also used coded language and, at one point, and Adam Skelos purchased a one-time cell phone, known as burner phone, erroneously thinking that the calls could not be traced by any law enforcement surveillance, says Bharara.

“Adam also expressed frustration to his father that it was becoming too dangerous and difficult to talk on the phone like they used to,” said Bharara.

The U.S. Attorney says Senator Skelos instructed his son to cancel key meetings with other state senators that would promote the environmental  company’s interest.

"Right now, we are in dangerous times’,” Bharara says Skelos told his son.

But even then, the U.S. Attorney says the Skeloses, father and son, “did not entirely abandon their corrupt scheme.” The still tried to get favorable legislation and funds secured for the environmental company in the recently-enacted state budget. In early March they were recorded complaining that Governor Cuomo’s push for an ethics reform deal was getting in the way of their alleged scheming.

Skelos’ calls were wiretapped and, according to the complaint, he at one point bragged to his son, after he was elected the sole leader of the Senate in January, that “ I’m going to control everything…what legislation goes to the floor, the budget, everything.”

Adam Skelos was recorded on his burner phone, complaining “You can’t talk normally because it’s like f***ing Preet Bharara is listening to every f***ing phone call.”

Skelos is the fifth Senate leader in a row to be accused or convicted of corruption. His arrest comes just over three months after the former Assembly Speaker, Sheldon Silver, was arrested and charged with running a multi-million dollar corruption scheme. Silver resigned from his post and was replaced.

Bharara, who said after Silver was arrested to “stay tuned,” says that message continues to be implicit every time the U.S. Attorney announces new corruption charges.

“Public corruption is a deep-seated problem in New York state,” said Bharara, who said its going on in both chambers of the legislature and in both major political parties

“We are deadly serious about tackling that problem,” Bharara added.

It is uncertain whether Skelos will have to step down as well. So far, the majority leader has said he intends to stay, and members of his Republican conference have not said publicly that they would like to see him gone.

The leader of the minority party Senate Democrats, Andrea Stewart Cousins, says she finds the charges against Skelos “deeply disturbing” and says she can’t see how he can continue  as leader.

Senator Skelos issued a statement in response to his arrest. In it he said he is “innocent of the charges leveled against me” and he says he fully expects “to be exonerated by a public jury trial.”