Carl Paladino: The Dirty Details in His Campaign Filings
The $53,000 tax lien against campaign spokesman Michael Caputo unearthed by the Times got a taunting "so what" from Caputo himself. Stiffing the IRS just proved again, as Caputo put it, that this is "a campaign of junkyard dogs."
No wonder Caputo, Carl, and the rest chat so comfortably with Duke, the untethered pit bull that accompanies Paladino on baby-kiss-free campaign swings. "Carl knows each of us comes to the campaign with warts," Caputo continued, acknowledging even that the candidate "has his own" warts. "We don't hide anything."
Actually, the so-called disclosure forms that People for Paladino filed with the State Board of Elections were designed to hide a lot, in apparent violation of state law.
Most hidden was the viral hand of the man who manufactured Paladino but never directly appears on his campaign filings, Roger Stone, the infamous Republican dirty trickster who suggested to the Times in August that he was advising Paladino pro-bono, which literally means "for the public good."
With a tattoo of Richard Nixon's head on his back, Stone's scandals started with Watergate, when he was 19, and peaked in 1996 when ads he placed in Local Swing Fever picturing himself and his wife seeking "athletes and military men" cost him a key role in Bob Dole's presidential campaign. He reached legendary proportions in a New Yorker profile in 2008 subtitled "Campaign tips from the man who's done it all," lodged over a bare-chested photo of a smug Stone, who'd described himself as "handsome body builder husband" in that long-ago ad.
Another Paladino filing is due by the end of the week, but look at what the prior submissions contain:
*Two companies controlled by Stone's secretary Dianne Thorne, and registered out of her Miami apartment, have received a total of $84,320 so far from the campaign. The payments started in March, shortly after the campaign also made the first of $17,000 in payments to Thorne's stepson, Andrew Miller, who listed a St. Peters, Missouri address. Miller was confounded when the Times told him he'd actually appeared on the payroll for four months longer than he was aware. Thorne, down on the beach, was described as Paladino's "scheduler." She actually once had a company registered out of the same address called Hype LLC.
*Caputo himself was paid $407,190 in the first six months of the campaign, a remarkable sum for a hired mouth, suggesting that he gets expletive bonuses. Since Stone recommended his former driver Caputo to Paladino, and Caputo and Stone have worked together on and off since the mid-90s (when Caputo handled the press response to Roger's group-sex scandal), this largesse may not belong exclusively to the lien-laden Caputo. In any event, it was paid to Caputo Public Relations at an East Aurora address, a village near Buffalo. No such company is incorporated in the state, according to the secretary of state's office. Caputo's firm does have a website, listed at the address of Caputo's father's insurance company, as well as a Florida location. But Florida officials tell the Voice that the state dissolved the company on September 25, 2009 for failing to meet registration requirements. Even junkyards incorporate a petty legal requirement with large tax implications.
*These are hardly the only avenues available to Stone if he was seeking to supplement his charitable good works on Paladino's behalf. The campaign has adopted the extraordinary new tactic of making major payments to a Paladino family real estate company, which, in turn, pays the wages of unnamed campaign workers. So far, it has hidden $62,278 in payments to this invisible staff, an apparent violation of state laws requiring the actual identities of people paid to work in campaigns. Paladino has also formed his own advertising firm for this campaign, Ellicott Advertising, which was paid $1.8 million by the campaign to do TV and radio ads. These insider deals make it all the easier to conceal Roger rewards. * Stone simply moved his traveling troupe of "misfits," as Caputo himself characterized the Paladino crew in an Observer piece, from a 2009 losing effort last November in Ohio. Stone was in Ohio as the "strategic consultant" to an anti-casino campaign, trying to defeat a referendum legalizing casinos in four cities. Having made a fortune in the Indian gaming business, Stone also opposes casinos when a casino interest pays him to, and that's precisely what he was doing in Ohio. Stone, his onetime top client Donald Trump, and a third party were hit with a record $250,000 fine by the New York lobbying commission in 2000 over their similar effort to kill New York casinos that might compete with Trump's Atlantic City empire.
This time, in Ohio, Stone was working for Jeffrey Jacobs and MTR Gaming, the big buck backer of something called TruthPAC, which led the fight against the casino ballot issue. Jacobs owns a Columbus racetrack and a West Virginia casino threatened by the Ohio measure. Not only is Stone fungible on gaming issues, he's never too picky about his politics either. Jacobs' ties to Ohio Democratic Governor Ted Strickland were so strong that Strickland's treasurer was Truth Pac's treasurer, and Stone had to share the strategic workload for TruthPAC with the media adviser for the Ohio House's Democratic caucus.
So guess who's on the TruthPAC payroll for $67,701? Caputo Public Relations Inc. at its Florida address (appropriately enough, no Inc. is used on the Paladino filing). State officials actually dissolved the company while Caputo was working for TruthPAC, with two payments totaling $21,500 made after its dissolution. In addition to the payments to the Caputo company, TruthPAC gave $5,000 to Caputo's wife Maryna, who he married that June and took on a tugboat honeymoon that lasted months. On August 15, after his boat broke down, Caputo blogged: "Now we're headed to Cleveland to await the repair and win a campaign!"
One of the same Thorne companies that appear on the Paladino filings comes in for $15,000 in Ohio, as does stepson Andrew Miller for $3,200. In addition to Miller, Terrence Cronin, also listed at a St. Peters address, collected $1,500. Even Thorne's husband Tim Suereth, a Florida real estate broker, was paid $20,171. Two Stone companies from Florida that don't appear on the Paladino filings walked away with over $200,000.
A North Carolina web outfit, Clamworks, has received $36,059 so far from Paladino and $48,510 from TruthPAC.
Cornerstone Management Partners, a New Jersey mailing database company, got $12,500 from Paladino and $228,250 from TruthPAC.
William Rey used Paladino's Buffalo business address for his $5,640 payments in that campaign and a Florida address for his $5819 in Ohio payments.
In fact, the majority of the TruthPAC vendors from outside Ohio climbed on the Stone tour bus to Buffalo, meaning that the same Stone operation that guided Paladino to his primary win sent Jacobs to his general election defeat.
TruthPAC got in hot water over an ad it ran on TV that featured wanted ads placed in Las Vegas and Atlantic City newspapers to suggest that out-of-staters were being recruited to take the new casino jobs if the referendum passed. The pro-casino forces denied that anyone associated with them had placed the ads, arguing that no one would advertise jobs now for casinos that wouldn't even be built for years. An AP story reported that the ads were actually placed by an Indian-gaming equipment supplier whose principal was once tied to Trump and Stone, though TruthPAC denied it had anything to do with the ads.
Caputo shot a video opposing the ballot initiative in Niagara Falls, near Buffalo, trying to make the case that the new Indian casino there killed local businesses and jobs. The same Seneca tribe bought Paladino land in Buffalo to build another casino.
Stone's benefactor and longtime ally Jacobs resigned in 2010 after suffering a $24 million loss in the final quarter of 2009, partially attributable to the costly and botched anti-casino fight.
* A rather famous right-winger, Larry Klayman, published a book last year called Whores, subtitled "Why and How I Came to Fight the Establishment." The founder of Judicial Watch, the leading anti-Clinton advocacy group in the 90s, Klayman ran for senate in Florida in 2004 and hired Stone to run the campaign in May 2003. He calls the crew Stone brought in the Dirty Dozen, and some of the names should send a chill up Carl Paladino's spine.
For starters, Klayman refers to Caputo as "a frequently well-lubricated press secretary who had once worked for Boris Yelstsin."
Then there's Dianne Thorne. "Commissioning the husband of his secretary Diane (sic) to find space," wrote Klayman, "Roger leased the entire upper floor of a dilapidated building, right above a dry cleaner. Perhaps I should have taken note of that as an omen. I didn't realize then that Roger and company were taking me to the cleaners."
Next Klayman went to Roger's Miami villa and met a pollster Roger hired, Tony Fabrizio, who's on the Paladino tab now and has billed $104,200 so far in this campaign. Klayman's starkest memory of the evening was sitting on the dock with Roger overlooking Biscayne Bay and hearing his campaign manager declare: "Isn't this great? I feel like Hyman Roth." Fabrizio runs a company that's still called Fabrizio McLaughlin but the McLaughlin part of it has split off, and McLaughlin Associates did the TruthPAC campaign. Stone has long been associated with both Fabrizio and John McLaughlin.
Stone's words to Klayman may ring some alarms for Paladino as well. When Klayman raised questions about the staff, which he said "acted like a bunch of misfits" (exactly the description Caputo later offered of the Paladino team), Roger said: "This is beneath you." The same happened when Roger picked the office space, which happened to be near Roger's suite on the same road. Roger also explained that "he would have to keep a low profile" because Klayman was not the candidate favored by the Bushes and "he was not favored by the Bushes either," though in fact all Stone was doing across the country in his Indian gaming self-promotion was marketing his Bush ties.
Klayman soon discovered that Stone was barely tending to business. He found him "sitting in an outdoor café salivating at the cavalcade of bodies, both male and female, marching up and down Lincoln Road" or in New York, "allegedly attending to his sick father." By the time Stone and Klayman parted company that fall, "I had a campaign debt of several hundred thousand dollars, much of it on my own lines of credit."
Stone had promised Klayman that he would do no other campaign and it wasn't until after he'd fired Roger that the senate candidate discovered that his consultant had another reason for his frequent New York trips. Already handling a candidate that Roger positioned as the most right wing in a right wing field (sound familiar, Carl?), Stone was simultaneously orchestrating the presidential campaign of none other than Al Sharpton, the biggest mouth on the left in the 2004 Democratic sweepstakes. An astonished Klayman cited my Voice article, which appeared in February 2004, concluding that "Roger and his band of misfits were even donating money" to Sharpton.
In fact, Mr. Tea Party today, tough-guy Michael Caputo, was one of the many rounded up by Stone in 2003 to give $250 to Sharpton, precisely the maximum contribution that would trigger federal matching funds. Another Klayman consultant, Teddi Segal, did the same. So did Thorne and Suereth. Even Paul Jensen and his wife gave to Sharpton though Jensen was Klayman's campaign counsel and a right wing anti-gay litigator of national prominence. Vendors that Stone put on the Klayman payroll just moved quietly over to Sharpton's payroll. The Federal Election Commission quickly ruled that Sharpton's matching fund submission was improper and forced him to return the $100,000 it had advanced the campaign. An FEC audit later resulted in another record fine, $285,000, against the Sharpton campaign.
Stone's undercover role with Sharpton was a gambit that flopped when the candidate flopped. Had Sharpton gone to the convention with more than a handful of delegates, like Jesse Jackson did in 1988, he could have ensnarled the eventual Democrat nominee in a racially damaging internecine war, presenting Stone with an opportunity to deliver for Bush like he did in Florida in 2000, when he helped organize the infamous Brooks Brothers riot during the recount. After my Stone stories in 2004, he created a website challenging their accuracy called the truthaboutstone.com. Caputo was listed as the contact person for the blog at a Stone corporate address.
Roger wasn't quite done with Klayman, however. Klayman blames Stone for planting a Miami Herald hit on him in the peak of the 2004 campaign, even suggesting that he did it to benefit another candidate that Klayman said he might have subsequently worked for. The story revolved around Klayman stiffing a Roger-owned company, as well as Fabrizio, Caputo, and others. "Caputo was claiming that I failed to pay him," writes Klayman. "In fact, Mike Caputo, who was paid handsomely thanks to Roger, rarely showed up for work on time or for that matter much at all, and he still owed me money I had loaned to him when he claimed to be short for payments to his estranged wife, whom he was divorcing."
A ruined Klayman got one percent of the vote, though he'd done well in early public polls. He gave up Judicial Watch for this campaign, and is so elusive now he can scarcely be located, though he recently filed the first lawsuit against the so-called Ground Zero Mosque. I got him on the phone for this piece and told him it was about Roger. He promised to get back, but never did. *
Of course, the Florida-based Stone has been involved in New York politics for years. Indeed, it was his purported role in bringing down Eliot Spitzer that prompted the New Yorker profile by Jeffrey Toobin, who's become somewhat of a Stone publicist. Stone brought Caputo to his first Miami meeting with Toobin and the two sidekicks gloated over websites that Caputo created in 2007 to apply relentless and reckless internet pressure on Spitzer while he was still governor.
The profile appeared months after Spitzer's resignation in a prostitution scandal, which Stone has also, ridiculously, claimed credit for, contending that he was the first to bring it to the attention of the feds. The timing of the Toobin interview allowed Caputo and Stone to chortle about tactics they'd denied doing just months earlier, bragging now that Stone was part of the website weaponry, though Caputo had told the Daily News' Celeste Katz in 2007 that he doing it out of "the goodness of his own heart" and wasn't on anyone's payroll. "I never worked in New York politics at Roger Stone's behest," truthteller Caputo assured the Albany Times Union. This fiction was necessary in 2007 because Roger was on the payroll of the state senate's GOP majority, managing its anti-Spitzer war.
Remarkably, Caputo and Stone praised Andrew Cuomo on one of these sites, which were focused on the Troopergate scandal, the absurdly overcharged contention that Spitzer had used the state police to spy on Senate GOP boss, Joe Bruno, who hired Stone to probe the Democratic governor. The site railed on about "Spitzer cronies" -- naming the State's Public Integrity Commission, the inspector general and the Albany District and accusing them all of working hard "to hide the truth."
"In contrast," wrote Caputo and Stone, "Democratic Attorney General Andrew Cuomo issued a damning report on Troopergate. His involvement was hobbled, however, as the governor refused to give his party rival the authority to issue subpoenas in the matter."
It is one of the many remarkable ironies of the Stone/Caputo management of Paladino's clean-up Albany campaign that their last state service was as the hatchet men for Bruno, convicted in a recent federal trial of crimes that define the corrupt state culture. It's their Bruno service that put them on both sides of Cuomo, who was an ally in the war with Spitzer.
Though Caputo was executive director until recently of a chamber of commerce sponsored group called Floridians for Smarter Growth opposed to an environmental referendum, he has some surprisingly strong environmental credentials, particularly on Florida sewage dumping in the Atlantic. He even developed a Florida blog called reasonable shades of green, saying farewell in a March 20 post, just after he joined the Paladino campaign.
The post was headlined "So it's insurance now...Goodbye Politics." A Buffalo native who'd led what he branded a Forrest Gump life, Caputo said he'd "finally moved back to Buffalo." Calling himself "still a newly-wed," he said he was determined "to find some peace."
"I've had enough of the bullshit," he wrote. "I'll run just one more campaign." Linking to the Paladino site he'd just help develop, Caputo said that "working with Carl will likely be drinking from a fire hose." Instead of peace, though, he's now gushing from a five-alarmer.
Last night, he was thumping his barrel chest at 66-year-old Postman Fred Dicker, the real pit bull of New York politics, telling a reporter more powerful than Paladino will ever be that he was off their list, which is about as close as any Republican strategist in the state can come to throwing in the towel a month before election day. (I was apparently never on the list of people who get callbacks, because the bring-it Caputo never responded to my e-mails).
Caputo's blog post said he was returning to Buffalo to sell insurance with his father, but in fact the Tea Partier and new wife Maryna are trying to start The Roycroft Tea Company, embroiled in litigation over their attempt to sell "high quality organic loose leaf tea" but blessed with a recently granted permit by Buffalo authorities. Maryna used to be Marina Ponomarenko, a Ukrainian beauty he met there in 2007, and on their boating honeymoon in 2009, he reported that she was constantly working on her immigration papers while Caputo piloted her to Paladinoland. The contradictions of personal and public life apparently never hit home with guys like Caputo, who is now piloting the virulently anti-immigrant Paladino. Caputo's candidate challenged Fox reporter and native American Ti Hua Chang in a recent interview with the question: "You're not an illegal immigrant, are you?"
"Some will say I'll be bored selling insurance," Caputo blogged in March. But, he explained, in perhaps the only truthful even if subconscious reference he's ever made to Roger, "I've grown weary of all the crap flying around in campaigns, the disloyalty among thieves."
Put that in your next press release.
Research Credit: Lily Altavena, Samantha Cook, Ryan Gellis, Jared Greenfield, Puneet Parhar, Brianna Strange
Get the ICYMI: Today's Top Stories Newsletter Our daily newsletter delivers quick clicks to keep you in the know
Catch up on the day's news and stay informed with our daily digest of the most popular news, music, food and arts stories in New York, delivered to your inbox.