Joseph L. Bruno, the Former Majority Leader of the New York State Senate.

Joseph L. Bruno, the Former Majority Leader of the New York State Senate was charged with carrying out a scheme to defraud the State of New York and its citizens of the right to his honest services by soliciting private business from, and entering into direct and indirect financial relationships with, persons or entities who were pursuing interests before the New York State Legislature or other state agencies. The indictment further alleged that Bruno concealed and failed to disclose the existence and true nature of such financial relationships, and the resulting conflicts of interest while taking discretionary official actions benefitting parties with whom he had those relationships. While New York State legislators are part-time officials permitted to pursue other employment or business activities, the indictment alleged that Bruno improperly exploited his official position and concealed conflicts of interest, contrary to state ethics and reporting laws, with respect to his private “consulting” business. Each count of the indictment alleged particular uses of the mails or the interstate wires in furtherance of the alleged scheme.

United States Attorney Andrew T. Baxter and Special- Agent-in- Charge John F. Pikus of the Albany Division of the Federal Bureau of Investigation announce the verdict of a federal jury in Albany following the three-week trial of Joseph L. Bruno, the Former Majority Leader of the New York State Senate. After seven days of deliberation, the jury convicted Bruno on two felony counts, acquitted on five counts, and were unable to reach a verdict on one count of the indictment. The jury found Bruno guilty on the following “honest-services” mail fraud charges:

• Count 4, which involved Bruno’s dealings with two entities related to Jared E. Abbruzzese—Communication Technology Advisors LLC and Capital & Technology Advisors LLC—that made “consulting” payments to Bruno, which the government contended were not commensurate with legitimate services provided by Bruno; and
• Count 8, which related to Abbruzzese’s $80,000 “purchase” of a virtually worthless horse from Bruno, which the government contended was a disguised gift to Bruno to compensate him for “consulting fees” that another entity related to Abbruzzese stopped paying to Bruno.

The jury acquitted Bruno on five wire/mail fraud counts, which involved Bruno’s activities relating to other entities with which Bruno had private business arrangements—Wright Investors’ Service (Count 1), Asentinel (Count 2), two other entities related to Jared E. Abbruzzese (Counts 5 and 6), and BB Gardner Management Corporation (Count 7). The jury deadlocked on Count 3, which involved the activities of Bruno relating to Leonard J. Fassler and various related entities that made “consulting” payments to Bruno, which the government contended were not earned by Bruno for legitimate services.

U.S. District Judge Gary L. Sharpe declared a mistrial with respect to the one count on which the jury was deadlocked. The United States Attorney’s Office will consider whether to re-try Bruno on that count following post-trial motions and after appropriate internal deliberation. Sentencing was scheduled for March 31, 2010 before Judge Sharpe. Joseph L. Bruno faces a sentence of up to 20 years in prison and a fine of up to $250,000 for each count on which he was convicted. The parties consented to a bench trial on the government’s asset forfeiture demand.

United States Attorney Baxter made the following statement regarding the Bruno verdict: “We commend the jury for their dedicated and patient service. The jury’s guilty verdict on two felony counts reflects their unanimous determination that Joseph L. Bruno deprived of the citizens of New York of his honest and faithful services, contrary to federal law. I am extremely proud of Assistant United States Attorneys Elizabeth C. Coombe and William C. Pericak, who made a fair and cogent presentation of the government’s case, reflecting the highest principles of federal prosecutors. We appreciate the efforts of the Federal Bureau of Investigation and the Inspector General of the U.S. Department of Labor in developing this seminal case and assisting with the prosecution.”

United States Attorney Baxter continued: “As the Senate Majority Leader, Joseph L. Bruno had a fiduciary relationship with the State of New York and its citizens requiring disinterested decision making and candid disclosure of the potential motivation behind his official acts. We established at this trial that Bruno exploited his office by concealing the nature and source of substantial payments that he received from parties that benefitted from his official actions and the resulting conflicts of interest.”

“The prosecutors and agents involved in this case take no pleasure from what the trial revealed about the culture of the New York State Senate, under the leadership of Joseph L. Bruno. Federal law enforcement in the Northern District of New York will continue to strive to ensure that public officials who breach their public trust will be held accountable, notwithstanding the challenges presented by the state’s inadequate legislative ethics and disclosure laws.”

Governor David A. Paterson

Governor David A. Paterson met with more than 50 members of the small business community from the Capital Region, Hudson Valley and across the State to discuss his Deficit Reduction Plan (DRP) and the State’s current fiscal situation. The meeting, which took place in Albany, was one of several that the Governor has convened across the State, including in New York City, Long Island, the Hudson Valley, Syracuse, Binghamton, and Watertown.

“The time for action is now. We cannot continue to put off the difficult choices we must make in order to preserve our financial stability”  Governor Paterson.

The Governor has hosted these conversations in an effort to better understand the concerns of New York’s business communities and to emphasize that his proposed reductions he are painful but necessary steps to ensure the long term health of the State.

“The time for action is now. We cannot continue to put off the difficult choices we must make in order to preserve our financial stability,” said Governor Paterson. “Doing so, will only make those choices more difficult down the road. That is why I am traveling the State to personally make my case to the people of New York and to listen to their concerns and ideas.”

“Today’s meeting focused on the small business community – a community that is the engine of the New York State economy,” continued the Governor. “I am committed to helping them grow even as we face the worst economic downturn since the Great Depression.”

This September, Governor Paterson unveiled a comprehensive guide for small business owners and entrepreneurs – a first-of-its-kind, comprehensive and interactive guide that will assist entrepreneurs in starting new businesses and will provide current small business owners with invaluable information and resources. The handbook is a direct result of the work done by the Governor’s Small Business Task Force, a group of statewide business leaders that convened this summer. Governor Paterson charged the task force with developing new strategies to address the concerns of small business in New York and to promote their growth and development.

The directory is available HERE.

Mike Elmendorf, New York State Director of the National Federation of Independent Business (NFIB), said: “New York faces a very real and very dire fiscal crisis. It is a crisis of over-spending, not revenue, and certainly not under-taxation, brought on by years of unsustainable spending that neither State government nor its taxpayers could afford. Now is the time for real and substantial reductions in State spending, and fundamental changes to stop New York’s pattern of limping from fiscal crisis to fiscal crisis, such as a State spending cap and public employee pension reform. Small business owners make tough choices every day to keep their businesses running and their employees working. They also know they cannot spend more than they take in. It is high time for State government to do the same. Governor Paterson’s deficit reduction plan is a critical first step toward restoring fiscal stability in New York, and NFIB urges the legislature to enact it.”

F. Michael Tucker, President and CEO of the Center for Economic Growth, said: “Governor Paterson clearly understands the urgent need to implement a deficit reduction plan to insure the short term viability of New York State’s economy. To do nothing or continue ‘spending as usual’ will result in a disastrous downward spiral that will take years to recover. State government must tighten its belt just like families and businesses do in tough economic times.”

Bob Mallozzi of the Mallozzi Restaurant Group in Schenectady said: “Governor Paterson’s Deficit Reduction Plan is a courageous and necessary course of action, and the first step in the process of restoring financial stability to the State of New York.”