The biggest RIOC scandal of all time, for now, at least, brought three resignations and a jail sentence. But more important today, it shines a glaring light on current failures in responsibility.
By David Stone
String of facts…
Introduction to RIOC’s biggest scandal…
When I started researching the scandal that engulfed RIOC in 2012, I wasn’t expecting it resonating so clearly with today’s administration and its failures in responsibility.
But then, I got a look at a report from the Inspector General, written in 2014. Its slashing review of RIOC corruption shows how at least one RIOC executive used Southpoint Park as a personal piggybank. Worse yet was the utter failure of the board and insiders doing anything about it.
The biggest RIOC scandal fell apart only because local residents raised enough hell and woke up Albany.
And as you’ll see, it’s not just that vice president of operations Fernando Martinez hauled in $183,000 in bribes, it’s that the largest chunk came from money for cleaning up Southpoint Park.
Roots of the crimes…
As the IG report shows, Martinez started raking in “fees” from Bright Cleaning Solutions before hiring on with RIOC. He got a monthly finder’s fee of $1,000 and slice of the profits.
During this period, Martinez worked at SUNY Downstate Medical Center, according to his LinkedIn profile.
Martinez’s close friend, Xavier Ramos, owned BCS, a fact withheld from RIOC, and he brought the company and his deal with him to 591 Main Street.
The IG also found Martinez breaking RIOC and state rules about nepotism, hiring relatives and even creating a whole new job title for one who co-workers found incompetent.
But the big deal, the one that should be a bright red beacon for RIOC’s board and current management, is what he pulled off in Southpoint.
By the end, Martinez pocket $74,000 of the $252,500 RIOC eventually approved for cleaning up Southpoint — all of it — but the horror story hardly ends there.
Getting the big haul out of Southpoint… with unanimous board approval
The scheme started small.
Declaring an emergency, avoiding standard procurement guidelines, Martinez cobbled together a set of three bids, using two for information. That led to a November 2008 award of $43,500 to none other than his buddy at Bright Cleaning Solutions.
Although he concealed that maneuver, nowhere does it appear that anyone objected to his hiring of a janitorial service for an environmental clean up. BCS’s credentials are not questioned by RIOC CEO Steve Shane or by the board.
They just took money collected from residents and handed it over to an unqualified vendor who, in turn, kicked a chunk back to Fernandez.
But it didn’t stop there.
Just a month later, RIOC gave BCS another $6,500 because “…the cleanup had uncovered a large number of household, nonbiodegradable materials at the site such as mattresses, carpets and plastics, which required larger equipment and more disposal containers than anticipated.”
Stepping up the game in the biggest RIOC Scandal…
It was just too easy.
Martinez and Ramos were only getting started. That same month, December, 2008, Martinez said clean up of Southpoint Park was done, after only a month. But he had more up his sleeve.
In a memo, he recommended expanding the project to include cleaning up the shorelines. To the tune of $210,000. Shane agreed to “beautifying” the shorelines and presented the deal to the board in January.
As previously noted, out team of experts determined, through rigorous analysis, that only one thing in the universe is harder than getting unanimous RIOC board approval for spending public money.
“Falling off a log,” our experts say.
And you guessed it. The $210,000 award got the nod in May, 2009.
But if your hair’s not standing on end yet, consider this. RIOC, again with unanimous board approval, is currently paying another favored contractor, Langan, upwards of $5 million for the same work.
Of course, it’s even worse. Evidence is clear that Southpoint, from top to bottom, is filled with toxic wastes, as we reported. BCS could never have cleaned it all up in a month, and Langan’s own, long concealed 2014 survey showed shorelines saturated with multiple toxins.
Where did they come from?
So far, RIOC refuses to answer, and there is no evidence of any testing complimenting the rush for Langan’s converting Southpoint into Brooklyn Bridge Park North.
The park welcomes visitors today, sans any warnings, although the state never adequately addressed toxic waste concerns.
Small by comparison, collateral damage rolled on through the next six months.
Powered by noise created by activist Roosevelt Islanders, follow up investigations led to resignations of RIOC president Leslie Torres and CFO Steve Chironis.
The IG got Torres for abusing a RIOC credit card, absenteeism and using a state vehicle. She resigned in September 2012.
Martinez followed in December and, as a result of the IG investigation, pleaded guilty to one felony in 2014.
Chironis, who seems to have profited the least personally, misusing a credit card for meals, paid a price for enabling the whole mess. He lasted until August 2013.
Conclusion: the biggest RIOC scandal today…
The repercussions are several.
First, the biggest RIOC scandal undermined trust, and while subsequent steps shored up control and accountability, 2020’s shenanigans tell us there’s a long way to go. Secrecy and lying remain endemic with RIOC.
We can’t say it enough. When you’re doing the right thing, secrecy and dishonesty are absent. On the other hand…
And another point made by activist Frank Farance: “Stupid people keep doing stupid things.”
Second, the serious issue of toxic wastes in Southpoint remains unaddressed, and RIOC appears actually resistant toward considering it. Risks — and liabilities — are already present, after RIOC and Langan failed at making public toxic wastes discovered in 2014. And for five years, thereafter, they let workers get exposed on a daily basis, never issuing a single warning.
Third, and probably most impactful in the long run, the utter failure of firewalls in place for protecting the public….
Largely under Albany control, not a single local elected official raised a finger to stop RIOC’s negligence, incompetence and revenge-seeking. In fact, each leans on Albany for political backing, and none represents constituents first.
Stress calls out weaknesses, and ours are glaring.
Finally, that extends to RIOC’s neglectful board. Fiduciary responsibility for overseeing the agency’s operations is nonexistent.
Three sat through the biggest RIOC scandal, unanimous, one and all, and show no remorse or even learning from the experience.
Where oh where is the Inspector General today?