Cuomo’s Office Admits Former Top Aide May Have Defrauded the State

In a late Friday evening news dump, Governor Andrew Cuomo’s office admitted that former top aide Joseph Percoco and other contractors working closely with his administration may have “deceived” and “defrauded” the state.

The announcement came shortly after a federal investigation by U.S. attorney Prett Bharara had been revealed, in which potential improper lobbying and undisclosed conflicts of interests in Cuomo’s “Buffalo Billion” boondoggle have been alleged.

America Rising PAC launched it’s own investigation into the matter in January, saying “there are numerous questions surrounding potential ethical lapses of his administration in the Buffalo area.”

The Daily News reported how one of those questions being probed is that of Percoco:

A former top aide and several others close to Gov. Cuomo are being probed by the Manhattan U.S. Attorney’s office for potential improper lobbying and undisclosed conflicts of interests involving an upstate power plant and Cuomo’s signature “Buffalo Billion” economic development program, the Daily News has learned.

Joseph Percoco, who until recently was Cuomo’s $169,000-a-year executive deputy secretary, and had long been his political enforcer and close personal friend, is said by sources familiar with the investigation to be a key target.

A source with knowledge of the situation said Percoco failed to accurately report outside income he received came from entities with business before the state.

He also seemingly failed to report potential conflicts of interest to the Cuomo administration or recuse himself from projects he had ties to, several sources said.

Shortly thereafter, Cuomo’s office admitted that his aide and confidants may have been involved in some illegality.

A joint statement issued by Cuomo’s counsel and a former federal prosecutor said, “This investigation has recently raised questions of improper lobbying and undisclosed conflicts of interest by some individuals which may have deceived state employees involved in the respective programs and may have defrauded the state.”

Via the Observer:

Gov. Andrew Cuomo’s office acknowledged late today that contractors close to his office may have “deceived” and “defrauded” the state, and that one of his top aides may have engaged in “improper lobbying”—and announced he was putting a former lieutenant to Rudolph Giuliani in charge of a “full review.”

The joint statement from Cuomo counsel Alphonso David and former federal prosecutor Bart Schwartz dropped shortly after 5 pm on a Friday, a classic tactic for burying potentially damaging news. Just minutes earlier, the Daily News reported that Joseph Percoco—the governor’s former executive deputy secretary and close personal and political confidante—may have engaged in “self-dealing” by taking work from a lobbyist while still employed by the state.

Mr. David said the allegations are tied to U.S. Attorney Preet Bharara’s probe of the “Buffalo Billion” economic development package in western New York, which saw major contracts go to top Cuomo donors like developer Louis Ciminelli.

The New York Times added that investigators are trying to determine whether Percoco and his wife might have gotten tens of thousands of dollars from a design and engineering firm involved in the Buffalo Billion project.

Authorities are investigating whether Mr. Percoco and his wife had received tens of thousands of dollars in income from a design and engineering company that worked on the project and failed to properly declare it, two of the people said. The company, according to a person familiar with the development program, worked on one of the main projects, a solar-panel factory for SolarCity, whose chairman is Elon Musk, the chief executive of Tesla Motors.

The investigation has sent shockwaves throughout the administration with one state source telling the Buffalo News, “the devastation is acute” and “everyone is literally flabbergasted.”

Percoco, described as “hulking” by the Observer, has long been Cuomo’s strong arm man.

When the investigation into Cuomo’s shuttering of the Moreland ‘ethics’ panel was heating up, Percoco called several of the commissioner’s on the ethics panel and ‘encouraged’ them to make public statements in support of the governor. He intimidated the members, even allegedly offering to write the statements for them and suggesting that the commissioners with which he was ‘encouraging’ use private e-mails rather than New York state accounts.

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