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Ciminelli indictments suggest feds going 'full speed ahead,' former DA says

There were few, if any, surprise surprises in the federal grand jury indictments made public Tuesday in the LPCiminelli fraud and bribery case.

Buffalo developer Louis P. Ciminelli and two of his top aides are accused of making payoffs to a state consultant who then made sure that LPCiminelli would be the state’s “preferred developer” for one of the most expensive public works projects in Buffalo history – the $750 million SolarCity plant..

U.S. Attorney Preet Bharara  first made that charge in a criminal complaint two months ago. It was restated Tuesday  in the indictments, though the Manhattan-based Bharara made no new allegations.

But the indictments are viewed by one legal expert as an important procedural step in the case against Louis P. Ciminelli, chief executive officer of the Buffalo construction firm, and two of his top aides, Kevin Schuler and Michael Laipple.

Putting the case before a grand jury and obtaining indictments show the U.S. Justice Department is moving “full speed ahead” with its prosecution, said Frank J. Clark, a former federal prosecutor and former Erie County district attorney.

“Sometimes, when you file a criminal complaint, it kind of dies on the vine, because of questions about witnesses, a victim or other issues,” Clark said. “But once a prosecutor goes to the point of putting his witnesses and his evidence before a grand jury, it can be assumed that the prosecutor feels any problems have been resolved. A good prosecutor doesn’t put a case before a grand jury unless they are really committed to it.”

The indictment are also an indication that – for now, at least – none of the Buffalo defendants is taking a plea deal in the case.

“When the case is in the criminal complaint stage and not yet indicted, that is the time when prosecutors and defense attorneys have the most latitude to make some kind of arrangement on a guilty plea,” Clark said. “You can still make a plea deal after the indictment, but it’s easier to do it before you reach the indictment stage.”

In the meantime, the words "bribery, corruption and fraud" seem to  sum up the charges against the executives in connection with  state contracts awarded by the Buffalo Billion economic development program.

 

The indictment clarifies the exact charges. All three Ciminelli executives face counts of wire fraud conspiracy and bribery. The RiverBend site is where SolarCity Corp., a California company, has committed to hire nearly 1,500 people to operate the largest solar panel manufacturing firm in the Western Hemisphere.

The indictment  details how the trio and others across the state conspired to "secretly rig the bidding process for state contracts worth hundreds of millions of dollars" in favor of LPCiminelli and other companies.

The government elaborated  that lobbyist Todd Howe and Alain Kaloyeros, president of the SUNY Polytechnic Institute that oversaw state development projects such as the SolarCity solar panel factory in South Buffalo, provided the appearance of an open competition for the Buffalo project when LPCiminelli had actually been pre-selected by Howe and Kaloyeros.

And in what could preview a significant aspect of the government's case, the indictment notes the selection of the two companies occurred "after the Syracuse Developer [COR Development]  and the Buffalo Developer [LPCiminelli] had each made sizable contributions to the Governor and had begun paying Howe in exchange for Howe's influence over the request for proposal process."

"These preferred developer contracts were particularly lucrative for the Syracuse Developer and the Buffalo Developer," the indictment continues, "as the Syracuse Developer and the Buffalo Developer were then entitled to be awarded future development contracts of any size in Syracuse or Buffalo, respectively, without additional competitive bidding."

Bharara's team also charges that Howe (who has already pleaded guilty to eight felony charges of bribery, extortion, wire fraud and tax evasion) and Kaloyeros provided "secret information" to Ciminelli, Laipple and Schuler about the Buffalo project, including the "location and purpose of the first preferred developer project...that was provided to no other developer."

Then Howe and Kaloyeros worked with Ciminelli, Laipple and Schuler to secretly alter the Buffalo RFP to "include qualifications that would favor the Buffalo Developer," Bharara charged. The prosecution also contends that LPCiminelli falsely certified that nobody had influenced the contract award, when the company had  retained Howe for exactly that purpose.

"Ciminelli, Laipple and Schuler paid bribes to Todd Howe...to influence and to reward the taking of official action in his capacity as an agent and representative of SUNY Polytechnic in connection with obtaining the Buffalo RFP."

Court appearances for Ciminelli, Schuler and Laipple will be held off until after Thanksgiving Day, and will probably be scheduled for New York City no sooner than next week, sources close to the case said. Criminal investigators from the Internal Revenue Service are also  working with Buffalo FBI agents on the case.

Two months ago, the three Buffalo-area men pleaded not guilty, and LPCiminelli issued a statement saying, “We are confident everyone will be vindicated.”

Ciminelli, Schuler and Laipple are all represented by prominent Buffalo defense attorneys, Daniel C. Oliverio, Terrence M. Connors and Herbert L. Greenman.

“Unequivocally, my client, Mr. Schuler and Mr. Laipple are innocent,” Oliverio said after the charges were filed in September. “In an 80-page criminal complaint, my client is mentioned twice. There are statements throughout the criminal complaint that are absolutely erroneous.”

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