Prosecutor: Consultant Stole $1M from NYC Mayor

By Samantha Gross
|  Monday, Sep 26, 2011  |  Updated 6:18 PM EDT
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Prosecutor: Consultant Stole $1M from Mayor

AP

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A political consultant accused of stealing more than $1 million from Mayor Michael Bloomberg has been turned into a scapegoat by mayoral staffers eager to distance themselves from unsavory campaign practices, a defense lawyer told jurors Monday as the consultant's criminal trial began.

"There is fraud here, but it's campaign fraud by Mr. Bloomberg and his people," lawyer Raymond Castello said in his opening statement at John Haggerty's trial.

Haggerty is accused of taking the mayor's money to underwrite an elaborate 2009 poll-watching effort but then mounting only a meager operation and using most of the cash to buy his father's house. The mayor's representatives have said that his campaign broke no laws and followed standard practices. Prosecutors have not accused him of wrongdoing.

But the defense told Manhattan jurors Monday that the case would revolve around the billionaire mayor, and they sought to paint a picture of a self-financed candidate surrounded by loyalists who skirted campaign rules, blurred the line between the public and private sphere and didn't hesitate to bend the law to Bloomberg's benefit.

"This case is about winning at all costs. That's what Michael Bloomberg is all about," Castello told the jurors. "He spent over $100 million to win his third term as mayor of New York City. And he did not want to lose."

Prosecutors gave a less dramatic accounting of events, saying that Haggerty had outlined plans to provide more than 1,300 poll-watchers and instead pocketed hundreds of thousands of dollars and executed a cover-up after questions were raised by a reporter.

Haggerty didn't have the money to buy his father's house, but he did have "access to one of the largest mayoral campaigns this city has ever seen. ... And with it, the mayor's money," Manhattan Assistant District Attorney Brian Weinberg told the jurors.

The case could prove to be uncomfortable for the mayor, who is expected to testify. It stands to provide a rare peek behind the scenes of the $109 million effort that won the Democrat-turned-Republican-turned-unaffiliated candidate his third term at City Hall. Attorneys said that Bloomberg's first deputy mayor, Patricia Harris, would be among several staffers called to testify.

Castello called into question the motivations of the Bloomberg employees, saying they had all been granted immunity by prosecutors.

"Mr. Bloomberg has paid or is paying large sums of money to almost every witness who is testifying," the lawyer said.

A Bloomberg spokesman said Monday that the mayor has done nothing wrong.

"The person accused of breaking the law in this trial is Mr. Haggerty, who the evidence will show stole money from Mayor Bloomberg through outright lies," said Jason Post. "Mr. Haggerty and his legal team are prepared to say anything to avoid prison."

Former Deputy Mayor Kevin Sheekey testified Monday that he had asked Haggerty to handle poll watching for the 2009 campaign. Bloomberg donated $1.2 million to the state Independence Party, which agreed to pay Haggerty $1.1 million for the effort, prosecutors said.

Sheekey testified that he endorsed the donation based on a plan presented by Haggerty. He believed the money would be used to hire poll-watchers who would make sure voters weren't stymied by problems with voting machines or paperwork, he said.

Haggerty's lawyers have suggested the mayor's campaign didn't pay directly for the so-called ballot security effort in order to avoid associating itself with the practice, which has at times been subjected to court scrutiny as an alleged tool for voter suppression. A civil court judge has told the Independence Party — which hasn't been criminally charged and says it did nothing wrong — that its conduct "doesn't smell right."

Castello argued Monday that prosecutors can't prove that the money was stolen from Bloomberg because the mayor gave the money in a donation that, according to campaign finance law, could not legally be earmarked for a specific purpose.

Former state Attorney General Dennis Vacco, himself a political insider and now one of Haggerty's lawyers, quizzed Sheekey at length about his rise through the Washington, D.C., political world and the connections that led him to jobs at Bloomberg's financial information company, on his campaigns and eventually at the mayor's office.

Sheekey said he hadn't enjoyed his first two years at City Hall, when he was an adviser to the mayor. While high-ranking staffers at Bloomberg's financial information company had operated without titles, the culture at City Hall was different, he said: Without a recognized title, it was difficult to get things done.

When it came to his bids for office, Sheekey said he had urged Bloomberg to pay his own way rather than accepting political donations.

"The basic view is that it corrupts the system," he said. "I think it does put pressure on candidates. And if you can avoid it you can run a better campaign."

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