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If government law enforcers were half as tough on agencies like the MTA as they are on unions, two of its top officialschairman Peter Kalikow and board member Barry Feinsteinwould have some explaining to do.
Thanks to tough federal lawsuits aimed at rooting out corruption in labor's ranks, members and officers of several unions, most notably the Teamsters, operate under strict rules that bar them from meeting or dealing with former officials who were removed from office for wrongdoing.
And woe to those who break the rules, as New York's top Teamsters leader found out just last week. Teamsters Joint Council 16 chief Anthony Rumore now faces a two-month unpaid suspensionjust for having MTA member Feinstein, who was disgraced back in his days as a Teamster, speak to a Teamsters training conference in February.
In Kalikow's case, he also has a continuing association of the sort that would be expected to draw scrutiny, were he a union official.
The real estate millionaire who once owned the New York Post brought one of his top aides, a man named Rick Nastiwho pleaded guilty in a mob-linked newspaper circulation scam in 1992to last week's tense contract talks with the Transport Workers Union.
Nasti, a vice president in Kalikow's real estate firm, was seen several times accompanying Kalikow in and out of the MTA's suites at the Grand Hyatt Hotel, where the talks were held. Nasti even brazenly walked right into the Monday-night press conference at which Kalikow and Transport Workers Union president Roger Toussaint announced their contract settlement.
Nasti's presence was a shock to many who saw him at the talks. In April, Nasti abruptly quit the MTA after questions were raised by the Daily News' Michael Blood about Nasti's work at the agency. Blood learned that Nasti was serving as Kalikow's unpaid liaison to several firms seeking multi-billion-dollar subway procurement contracts.
MTA spokesman Tom Kelly acknowledged that Nasti was present at the hotel during the talks, but said he was there only out of friendship for his boss. "Rick Nasti is a friend of Peter Kalikow's," said Kelly. "He had no role in the negotiations with Roger Toussaint or his representatives."
Nasti's conviction stemmed from an uncomfortable chapter in Kalikow's past when he owned the Post. At the time, Nasti was serving as Kalikow's right-hand man at the paper. The two knew each other from the 1986 reelection campaign of then senator Alfonse D'Amato. Nasti, a longtime D'Amato aide, served as manager of the campaign, and Kalikow was in charge of fundraising.
An investigation by the Manhattan district attorney's office into mob corruption in the newspaper industry found a massive scheme at the Post, which inflated its circulation figures by more than 50,000 sales per day in order to cheat advertisers. As part of his plea of guilty to labor law violationsa misdemeanorNasti admitted to his role in the scheme, which included members of organized crime. A dozen gangsters were arrested in the case, including several high-level figures in the Bonanno crime family.
Kalikow was never charged, although the corporation that owned the newspaper pled guilty to a felony count and agreed to compensate advertisers $2.3 million in fees. Kalikow, facing money troubles, later sold the paper in a move that cost the Posts editorial workers millions of dollars in severance pay. He filed for bankruptcy, got out of it, then was named to the MTA in 1999 by Governor Pataki and made its chairman in 2001.
Nasti also landed on his feet. After the guilty plea, he gave up his own position as an MTA board membera post he gained with D'Amato's backingbut he was soon hired by Kalikow's real estate company, where he today serves as senior vice president. There, he works alongside another former top Post employee, Steve Bumbaca, who also pled guilty to a misdemeanor in the scheme and is currently controller for Kalikow's firm.
Nasti's conviction also didn't prevent him from being named in 1996 by Pataki to serve as chairman of the advisory council at his alma mater, State University of New York at Stony Brook.
But the affair had lasting repercussions for the hoodlums involved and the city's newspaper deliverers union, whose members were enlisted in the scheme. Robert Perrino, a mob associate who served as the Post's superintendent of delivery, was also charged in the scheme but vanished before his arrest. In October, a top Bonanno captain, Richard Cantarella, who also worked at the Post, was arrested and charged with killing Perrino to keep him from talking about the scam. Cantarella has pleaded not guilty.
The D.A.'s office was so concerned about its findings that it brought a criminal racketeering case against the Newspaper and Mail Deliverers Union. The case lingered for years, but in October, the union finally settled it with a consent decree that installs an outside monitorin this case, former Fordham Law School dean John Feerickto watchdog the union. Among other guidelines, the new restrictions bar members from associating with organized-crime figures as well as anyone permanently barred from membership in the NMDU or any other union.
That consent decree is just a mini-version of the one that the giant Teamsters union agreed to in 1989 after then rackets buster Rudy Giuliani sued it for corruption. The decree resulted in the ouster of more than 200 members and officials for a range of violations. One of them was MTA board member Feinstein, who resigned in 1993 after being accused by union monitors of embezzling $390,000 in member funds for high-living and taking $100,000 in interest-free loans from the union.
Feinstein's downfall was noisy and public. The charges against him made headlines, as did a week-long public hearing at which investigators introduced evidence of his high-flying, union-paid lifestyle, including expensive Chinese silk hangings and antiques that adorned an East Side apartment kept for him by the union. Once the city's most powerful municipal union leaderas head of Teamsters Local 237, which represents workers at the city Housing Authority and other agencies Feinstein agreed not to have anything to do with the Teamsters or its membership ever again. He now heads the Consortium for Worker Education, which provides job-training services.
But if Feinstein has been declared an untouchable in Teamster union affairs, he has no such taint as far as state political leaders are concerned. At the time of his resignation, Feinstein was already a member of the MTA board, appointed by then governor Mario Cuomo in 1989 at the urging of former senator Alfonse D'Amato. Governor Pataki reappointed Feinstein in 1998. He now serves as chairman of a key MTA committee overseeing New York City transit matters.
But if it's OK for governors and real estate millionaires to hang out with Feinstein, it is definitely not OK for Teamsters. Anthony Rumore, who heads New York's 150,000-member Teamster Joint Council 16, found that out earlier this year when he was charged by an internal union panel of consorting with Feinstein.
Rumore allowed Feinstein to address a union conference at the Hotel Fountainbleau in Miami Beach this Februaryeven after other Teamsters officials vigorously warned him not to do so. The internal union panel last month held a hearing on the matter, including testimony from Feinstein. The panel ruled that Feinstein is a so-called "prohibited person" under terms of the consent decree that union officials agreed to in 1989. Its ruling on Feinstein and Rumore was handed down on Friday, December 13the same day that transit labor talks were kicking into high gear at the Grand Hyatt Hotel on East 42nd Street with Feinstein in attendance.
Feinstein left town for the holidays after the transit talks and couldn't be reached. During the talks, however, he took time to sit down with the Post's Steve Dunleavy and give management's spin on the talks. "Yes, I suppose you could say I'm working for management. I often think of the irony of it myself," said Feinstein.
Actually, as Feinstein and Kalikow both know, it is a whole lot safer on that side of the table.