A Patronage Flop
Lou Carbonetti, Rudy Giuliani's childhood pal and failed patronage appointee, stood repentant before a Manhattan criminal judge last week to confess three counts of perjury. It was his fourth scandal in less than a decade and his first conviction, making his the toughest hard-luck story in an administration with an otherwise charmed life.
Carbonetti, 56, admitted to Acting Supreme Court Justice Brenda Soloff that he had lied when he told the city's Department of Investigation last year that while serving as director of the Fulton Mall Improvement Association in downtown Brooklyna post he owed to his friend, the former mayorhe'd never been hired as a consultant to drum up business for Techsolve, a Long Island-based computer firm. The question was important because Carbonetti had awarded the firm a $25,000 contract to design the association's website.
He'd lied as well when he said the firm never paid him any money. He'd lied again when the question was repeated in a slightly different form intended to cover all bases.
"Did Techsolve ever give you any benefit of any kind?" asked DOI investigators Alicia George and Julia Davis back on January 28, 2003.
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"None whatsoever," Carbonetti had answered with conviction.
In fact, as prosecutors revealed last week, the computer company and Carbonetti had signed a contract in March 2000, back when Carbonetti still had strong connections in City Hall. He would do what he could to find work for the firm, which in turn would pay him $5,000 a month.
Things hadn't gone well, however. Techsolve paid him his first month's fee but then cut his rate by half. Unable to get others to retain the company, an embarrassed Carbonetti did the next best thing: He hired the firm himself.
This conduct was all the more questionable since an audit by the city's comptroller had revealed that Carbonetti had squandered more than $700,000 of the association's reserves through poor management and improper expenditures.
"What makes this so sad is that he lied about a consulting agreement that is perfectly legal," said Carbonetti's lawyer, Paul Shechtman, a former top aide to Manhattan District Attorney Robert Morgenthau, whose office brought the charges. "His conduct was more foolish than anything else."
If the emblem of the Giuliani years seared in public consciousness remains the hard-charging, crime-busting mayor with the unfortunate combover, then its flip side is poor Lou Carbonetti, a schlepper whose repeated city appointments gave the lie to Giuliani's claims to have staffed his City Hall only with the best and the brightest. Time and again, the affable yet feckless Carbonetti was boosted aboard the mayor's political gravy train only to slide miserably back off again.
But then, they were lifelong friends. Their fathers had been buddies growing up in East Harlem; Carbonetti's was a Democratic district leader, and, as Wayne Barrett's Giuliani biography revealed, an aide to a mob-tied judge, while Giuliani's dad had his own connections, serving time in Sing Sing for a failed stickup.
In Giuliani's successful 1993 campaign, Lou Carbonetti helped out by serving as deputy manager for running mate Herman Badillo. After his election, Giuliani promptly named Carbonetti as his director of the city's Community Assistance Unit, the mayor's liaison with neighborhoods. He also hired Carbonetti's son Anthony as a top City Hall aide and promoted Carbonetti's ex-wife, JoAnna Aniello, to a high post at the city's Housing Authority.
Lou Carbonetti, however, quickly became an embarrassment. In early 1995, he was exposed as having failed to report more than $150,000 in debts, including unpaid taxes, on official financial disclosure reports. Worse, in a scam favored by miscreants all over New York, he was shown to have solved the problem of a suspended driver's license by obtaining a new one using a slightly altered name. Before the scandal broke, Giuliani had been preparing to name him a commissioner. Instead, Carbonetti resigned.
A year later Carbonetti was in the news again, this time when it was revealed that he was poised to be hired by a politically connected social services agency that had been awarded a $43 million welfare contract by City Hall, a deal in which Anthony Carbonetti played a key role. Another son, Louis Jr., was already working at the lucky agency. Giuliani said he had no idea his old pal was slated for a job there, and the contract was later dropped, but not before a federal grand jury probe was launched. No charges were ever made against the Carbonettis, but the head of the social services agency later pled guilty to making illegal campaign contributions.
After that, Carbonetti scrambled to make a living. For a while he managed a Greenwich Village restaurant. But in 1998, his old friend came through again, this time by forcing then Brooklyn borough president Howard Golden to accept Carbonetti as the $80,000-a-year chief of one of the borough's most important economic development organizations, running the business improvement district along downtown Fulton Street. Such BIDs, as they're called, depend on special business assessments and are heavily regulated by the city, a control that Giuliani had made even tighter.
When Carbonetti took over, the audit by Comptroller William Thompson later found, the association had $720,000 in assets. But for the following four years, Carbonetti ran in the red, draining its resources so severely that a special contract to provide uniformed security guards on the mall had to be canceled. He found money for more frivolous expenditures, however. He had the organization pay $351,000 for a set of ornamental archways, designed as replicas of Brooklyn's three East River bridges, installed at the district's entrances. Carbonetti assured his board that the city's business services agency would kick in half the cost, but paperwork for the funding was never completed and the grants never came through.
Even after Carbonetti had the association take out lines of credit worth $400,000, paying high interest on the debt, he continued to spend. He sponsored an awards dinner at the posh River Café, spending $21,000 for the dinner, musical entertainment, and a master of ceremonies. He spent $2,100 to buy breakfasts for his board of directors, and another $1,100 on his own meals at nearby restaurants.
In light of the fact that it had no money, "the [district] should have made more prudent decisions on how it spent its funds," the audit gently stated.
When rumors of the BID's money troubles and a city investigation swirled in early 2002, Carbonetti buoyantly insisted all was well. "No, I am not having any problems with DOI," he told the Voice then. "The board has unanimously supported me and there is no problem. Everything is kosher."
Less than a year later, Carbonetti was forced to resign. The ensuing DOI probe, kicked off by the audit questions, revealed that Carbonetti's attention was being diverted by other concerns. While denying his ties to the computer firm, he acknowledged to DOI that he did have a private consulting business, mentioning four corporate clients. One of them, he said, was a firm called Falcon Web Free Technologies. There is no such company, but there is a Falcon Water Free Technologies. Based in California, the firm sells waterless urinals. "He was hired as a salesman in July 2001," confirmed a company spokesman. "The relationship was discontinued shortly afterwards. He was supposed to see what he could do. Nothing came of it."
First-degree perjury is a felony that carries a maximum permissible sentence of seven years, but Carbonetti did well by the prosecutors. He will be on probation for the next five years, pay a $7,500 fine, and make $10,000 in restitution.
If his efforts to capitalize on his Giuliani associations fell apart, he can rest assured others in his family did well. Son Anthony is now prospering in Giuliani Partners, the ex-mayor's jet-setting consulting firm; and ex-wife Aniello earns $154,000 at the housing authority, courtesy of a last-minute promotion by the outgoing Giuliani regime in late 2001.
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