Thursday, March 27, 2008

Thursday, March 27, 2008

The Court Report
By Richard Blassberg

Mt. Vernon Federal Investigations Begin To Bear Fruit

Two Charged By U.S. In Scheme To Defraud City Of Mount Vernon Of More Than $1 Million

MICHAEL J. GARCIA, the United States Attorney for the Southern District of New York, and MARK J. MERSHON, Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), announced today the unsealing of an Indictment charging two individuals affiliated with a Westchester carting company with mail fraud and conspiracy for overbilling Mount Vernon by at least an estimated $1.25 million for the removal of construction debris and tree waste from Mount Vernon city property. In approximately November 2001, A & D Carting obtained a contract with the City of Mount Vernon to remove waste from a City storage yard at a price of $397 per 30- cubic yard container removed. To bill Mount Vernon under the contract, A & D Carting was required to submit invoices to Mount Vernon identifying how many 30-cubic-yard containers were removed on particular dates, together with a pre-printed receipt form (which is commonly referred to as a “ticket”) for the removal of each container.


The tickets were supposed to be signed by a Mount Vernon employee at the yard at the time each container was carted away. From 2002 through March 2006, ALBERTO TRANQUILLO III, an owner and operator of A & D carting, and MICHAEL PIZZOLONGO,
who helped manage A & D Carting’s business, defrauded the City of Mount Vernon by submitting tickets and invoices claiming that far more waste had been removed from the yard than had actually been removed, it was charged.

TRANQUILLO and PIZZOLONGO allegedly continued the scheme even after the Westchester Solid Waste Commission denied TRANQUILLO’s companies a carting license. After that denial, A & TWO CHARGED BY U.S. IN SCHEME TO DEFRAUD
CITY OF MOUNT VERNON OF MORE THAN $1 MILLION MICHAEL J. GARCIA, the United States Attorney for the Southern District of New York, and MARK J. MERSHON, Assistant Director-in-Charge of the New York Office of the Federal Bureau
of Investigation (“FBI”), announced today the unsealing of an Indictment charging two individuals affiliated with a Westchester carting company with mail fraud and conspiracy for overbilling Mount Vernon by at least an estimated $1.25 million for the removal of
construction debris and tree waste from Mount Vernon city property.

In approximately November 2001, A & D Carting obtained a contract with the City of Mount Vernon to remove waste from a City storage yard at a price of $397 per 30-cubic yard container removed. To bill Mount Vernon under the contract, A & D Carting was
required to submit invoices to Mount Vernon identifying how many 30-cubic-yard containers were removed on particular dates, together with a pre-printed receipt form (which is commonly referred to as a “ticket”) for the removal of each container.

The tickets were supposed to be signed by a Mount Vernon employee at the yard at the time each container was carted away. From 2002 through March 2006, ALBERTO TRANQUILLO III, an owner and operator of A & D carting, and MICHAEL PIZZOLONGO,
who helped manage A & D Carting’s business, defrauded the City of Mount Vernon by submitting tickets and invoices claiming that far more waste had been removed from the yard than had actually been removed, it was charged.

TRANQUILLO and PIZZOLONGO allegedly continued the scheme even after the Westchester Solid Waste Commission denied
TRANQUILLO’s companies a carting license. After that denial, A & D Carting was sold to United Waste Services, but even after this sale, which took place in December, 2003, TRANQUILLO’s companies continued to use trucks they owned to service the Mount Vernon
contract, and TRANQUILLO AND PIZZOLONGO continued to overbill Mount Vernon by submitting tickets and invoices vastly overstating the amount of waste removed.

The Indictment charges that, through this scheme, TRANQUILLO and PIZZOLONGO caused more than $1.25 million in losses to the City of Mount Vernon. Indeed, in 2002 – the Two Charged By U.S. In Scheme To Defraud City Of Mount Vernon Of More Than $1 Million first full year of the contract between A & D Carting and Mount Vernon – Mount Vernon paid companies controlled by TRANQUILLO $385,000, or approximately four times what Mount Vernon had paid for the removal of such waste the previous year. Mount Vernon’spayouts under the contract rose each subsequent year, peaking at approximately $856,000 in 2005. In that same year, records reflect that A & D Carting paid a dump to dispose of only 3,270 cubic yards of tree waste even though A & D claimed in its bills to Mount Vernon that it had collected 24,630 cubic yards of such waste from Mount Vernon.


COUNT ONE: CONSPIRACY TO COMMIT MAIL FRAUD


The Grand Jury charges:

THE SCHEME TO DEFRAUD MOUNT VERNON

1. At all times relevant to the Indictment, ALBERT TRANQUILLO III, a/k/a “Allie Boy,” the defendant, together with his now deceased father, Albert Tranquillo, Jr. (collectively, the “Tranquillos”), controlled carting contracts with the City of Mount Vernon through several
companies they owned and operated, including A & D Carting Corporation (“A & D Carting”) and Trancamp. At all times relevant to the Indictment, MICHAEL PIZZOLONGO, the defendant, assisted the Tranquillos in managing the contracts with Mount Vernon.

2. At all times relevant to the Indictment, the City of Mount Vernon collected debris from businesses and residences and temporarily stored that debris at a waste yard located at 10550 South Columbus Avenue in Mount Vernon, New York (the “yard”). The debris
included trees, branches and stumps as well as concrete and other construction debris. Mount Vernon contracted with private carting companies to remove the debris from the yard and appropriately dispose of it.

3. On or about November 30, 2001, the Tranquillos – through A & D Carting – were awarded a contract by the City of Mount Vernon to collect debris from the yard and dispose of it. Pursuant to the contract, the Tranquillos were paid $397 for each 30 cubic yard container of debris removed from the yard. To bill Mount Vernon under the contract, the Tranquillos were required to submit invoices to Mount Vernon identifying how many 30 cubic yard containers were removed from the yard on particular dates, together with a pre-printed receipt form (which is commonly referred to as a “ticket”) for the removal of each 30 cubic yard container of waste. The tickets were supposed to be signed by a Mount Vernon employee at the yard at the time each container was carted away.

4. ALBERT TRANQUILLO III, a/k/a “Allie Boy,” and MICHAEL PIZZOLONGO, the defendants, participated in an overbilling scheme from in or about 2002 until in or about March 2006 to defraud the City of Mount Vernon involving the submission of tickets and invoices claiming that far more waste had been removed from the yard than had actually been removed.

MICHAEL J. GARCIA, the United States Attorney for the Southern District of New York, announced that the former Commissioner of the Mount Vernon Department of Planning and Community Development and Executive Director of the Mount Vernon Department of Planning and Urban Renewal Agency, CONSTANCE G. POST, and WAYNE CHARLES were indicted today by a federal grand jury in White Plains on mail fraud charges. According to the Indictment, POST and CHARLES secretly agreed that CHARLES would receive the following:

(1) lucrative City contracts totaling more than $1 million, with CHARLES’s involvement in those contracts remaining hidden;

(2) a loan which would not be required to be repaid and which was not entered into the books and records of
Mount Vernon; and

(3) payment of architectural and other services benefiting properties in which CHARLES had an interest. According to the Indictment: CHARLES and POST secretly agreed that POST would benefit financially from CHARLES’s business dealings with the City of Mount Vernon and POST steered a series of contracts to CHARLES, while representing to the board of Mount Vernon’s Urban Renewal Agency that it was contracting with a company that was engaged in the business of providing computer services. CHARLES, however, had no prior experience in the industry. In addition, POST arranged for Mount Vernon to provide CHARLES with a loan that was not entered into the books and records of Mount Vernon until after POST was approached by federal investigators in 2005.

According to the Indictment, only after POST was approached by federal investigators did CHARLES make his first and only series of repayments, totaling approximately $7,500. In addition, POST authorized the payment of approximately $40,000 to pay for architectural and other services to benefit properties in which CHARLES had an interest, while not disclosing her personal and financial
relationship with CHARLES as described in the Indictment.

The Indictment also alleges that CHARLES and POST acted to cover-up their conduct: CHARLES lied to federal investigators in 2006, falsely stating that he had no involvement in the contracts that POST had steered to him. Throughout the relevant time period POST failed to disclose to Mount Vernon and HUD her personal and financial relationship with CHARLES, failed to file annual fi-nancial disclosure statements that she was required to file as Commissioner and Executive Director, and failed to enforce Mount Vernon’s loan provisions against CHARLES.

According to the Indictment, POST and CHARLES traveled together, secretly agreed to engage in financial transactions, and in 2004, CHARLES made a $30,000 payment to POST. POST, 58, of Mount Vernon, New York, and CHARLES, 55, of New York City, are scheduled to appear for arraignment in United States Magistrate Court in White Plains on March 26, 2008.

Mr. GARCIA said that the Indictment was the product of a joint investigation by the United States Department of Housing and Urban Development and the Federal Bureau of Investigation. He said the investigation is continuing. Assistant United States Attorneys CYNTHIA K. DUNNE and PERRY A. CARBONE are in charge of the prosecution.

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