Thursday, December 16, 2010

CityTime, Major Crime

Today is a dark day for the city of New York.

It was exactly fifty years ago, December 16, 1960, that two passenger planes collided, one crashing in Park Slope and the other in Staten Island. 134 people were killed, including six on the ground. It was the worst airplane accident in the city's history prior to September 11, 2001, which of course was no accident. Click here to see a picture of the young Gabe Pressman interviewing Mayor Wagner at the scene of the disaster.

Thursday, December 16, 2010, is the day the first scandal in the Bloomberg administration exploded publicly. It came with the indictment of six individuals for a series of crimes involving the theft of millions of dollars, reported by John Eligon on pA1 of today's Times, and on p1 of the Post by Bruce Golding, David Seifman and Dan Mangan. The story is also extensively covered on pp14 and 15 in the Daily News, whose Juan Gonzalez has been writing about the massive fraud literally for years, with relatively little attention paid to his reports.

The News' account begins: "A project to computerize city employee time sheets turned into a windfall for consultants who bilked the bloated program of $80 million, authorities said yesterday.

"Manhattan U.S. Attorney Preet Bharara brought charges of fraud and money laundering more than a year after the Daily News first exposed astonishing waste in the CityTime project."

The magnitude of the alleged fraud is enormous, reaching hundreds of millions of dollars. Even if the newspaper accounts are exaggerated, this is still major corruption on a substantial scale. It is far different than the frequent press releases about lower-level city employees who misstate their incomes and timesheets, or dishonest building inspectors who are nailed for petty graft.

The issues that come to mind here include these: How could this fraud have been carried on for so long, despite the fact that Juan Gonzalez was writing periodic stories about it which were published in the Daily News?

What was the responsibility of Joel Bondy, executive director of the Office of Payroll Administration for the last six years?

OPA is a joint operation of the Mayor and the Comptroller. Who was responsibility for overseeing its performance?

Where were OMB, DOI, DOITT, the Mayor's Office of Operations, the Mayor's Committee on Contracts, and all the other oversight agencies that slow the operation of government in the interest of assuring integrity and transparency? What was the response, if any, to the Gonzalez articles?

This matter is stranger because it is in the field of the mayor's particular competence: management of information technology. Mr. Bloomberg is quoted in today's Times: "The issue is that here we had someone that we trusted, or some of our contractors trusted, and that trust was misplaced. And we just have no tolerance for this whatsoever."

Of course, someone, or many people, betrayed the public trust, and we agreee with the Mayor in having zero tolerance for such criminality. This case should not end up with a plea bargain for a light sentence. This is heavy stuff.

The structural questions so far unanswered are basically variations on "How could this have happened in a government with multiple safeguards against misconduct?"

Is this case analogous to a secret embezzlement, known only to the immediate parties? Is it a conspiracy involving a number of people, not all of whom may already have been brought to justice? Who selected Joel Bondy, and who supervised him? Why is he still a city employee? What is the role of the Comptroller in overseeing OPA?

We believe that CityTime is to New York City government as Bernie Madoff was to the Securities and Exchange Commission. Wherever there is money, there will be crooks who will try to steal it. We have multiple guardians to protect us from predators. The millions involved here were not stolen overnight, or taken with machine guns? Where were our well-paid overseers for the past six years while this scheme was under way?

Questions remain to be answered, and we should not rest until complete justice is done, no matter who turns out to have been involved or who had knowledge of the facts and failed to act.

1 comment:

  1. To reduce the chance of fraud, you could always get your employees to use software that tracks employee computer activities then automatically generates timesheets for them - making timesheets more accurate and actually enjoyable. Clever Timesheets is an example.