Lawyer for Yonkers political operative calls for leniency, suggests (un-charged) Forest City Ratner was the big winner in corruption case

As sentencing Nov. 19 approaches for a former Yonkers elected official and her political mentor, both convicted in a corruption case involving two real estate projects, the lawyer for the political operative has asked the judge to look at the larger picture.

And that picture suggests that neither operative Zehy Jereis nor former Council Member Sandy Annabi were as big winners as Forest City Ratner, developer of the Ridge Hill mall and office project.

(The developer was not charged; its behavior, though not criminal, was less than sterling.)

A call for leniency

Much of the pre-sentencing memo prepared by Jereis's attorney argues for a lighter sentence than guidelines suggest, based on Jereis's character in the community. As the Journal News reported 11/9/12, in Zehy Jereis' lawyer urges leniency in Yonkers corruption sentence:

Former Yonkers GOP chairman Zehy Jereis deserves significant leniency when sentenced in his federal corruption case because of his ongoing community service and the care he provides his ill mother, his lawyer says in court papers.
Although sentencing guidelines call for more than a decade in prison, defense lawyer Anthony Siano this week asked U.S. District Judge Colleen McMahon to impose a sentence in the range of 10 to 18 months with some of that served under community confinement. He also requested that Jereis be allowed to remain free while he appeals his conviction.
“In all respects, Mr. Jereis has evinced by his actions and not merely in words, that his actions in his life were motivated by a desire to help others and not by profit,” Siano wrote in his pre-sentence memorandum, which included letters from 56 relatives, friends, tenants and political associates seeking leniency for Jereis.

The letter-writers also include his employees at a car wash in East New York, Brooklyn. (Here's coverage of Annabi's pre-sentencing memo.)

The big picture

Siano's memo also points to the big picture. Though Jereis provided Annabi with some $194,000 over the years, including a $60,000 loan promptly repaid, the money apparently came from his own resources.

"Taking the government's evidence on its face," Siano wrote, Jereis received no more than $25,000 from the real estate projects--$15,000 in fees after Forest City Ratner hired him for a $60,000-a-year no-show job after Annabi flipped her vote, and a $10,000 bribe related to the other project, known as Longfellow.

"At no time did he seek, receive, or have any equity or financial interest in either the Ridge Hill project or the Longfellow project," Siano wrote. "The benefits he conveyed upon Ms. Annabi were largely his own money and were paid out from his own checking account, in his own name."

Forest City the winner

"The evidence in the trial established that Forest City Ratner expended millions of dollars on lobbyists, consultants, and related opinion makers of all kinds. It was the Forest City Ratner interests alone that owned and profited from the Ridge Hill project," Siano wrote. "And indeed, it was solely the Forest City Ratner personnel that decided if, when, and why to hire Mr. Jereis and what they would pay him."

"Nothing in the testimony of the Forest City Ratner witnesses establishes any causal connection or quid pro quo type rational for their hiring of and payment of fifteen thousand dollars to Mr. Jereis," Siano wrote. Forest City's former government relations Executive VP Bruce Bender testified that it was "inconclusive" that they had promised Jereis a job, but "we certainly left the impression we were probably going to do it."

Siano pointed to one similarity between Longfellow and Ridge Hill: "the government's chosen witnesses themselves were going to profit," including equity gains and profits (the Longfellow developers, the Milios); continued legal fees (cooperating witness Anthony Mangone); and bonuses and raises (Bender and Scott Cantone, Forest City Ratner executives at the time).

"Despite these admitted profit motives centered on others, the government has prosecuted Mr. Jereis, and this Court must determine what punishment is proper for Mr. Jereis for his behavior," Siano wrote.

The Annabi relationship

The letters focused on Jereis's generosity to his family, friends, and others, including his close relationship to his children and his mother. Nearly everyone avoided Jereis's defense that his payments derived from his infatuation with Annabi, thus undermining his image as a family man.

One of his sisters, however, suggested an explanation: "The reason why my brother is in this situation is his heart, not BRIBERY. Sandy [Annabi] and people took his love and kindness for granted."

After leaving Forest City Ratner, Bender and Cantone rely on old ties for new clients: Prokhorov's Onexim, Viola's Virtu, and maybe even the Nets

Bruce Bender and Scott Cantone, Forest City Ratner's top government relations officials until they left earlier this year in the wake of the Ridge Hill corruption trial, have formed Bender Cantone Consulting, which relies in part on relationships begun while at Forest City Ratner.

The NYC Lobbyist Search web site (see screenshot at bottom) indicates five clients, including the Onexim Group, controlled by Brooklyn Nets majority owner Mikhail Prokhorov, which describes itself as "one of Russia’s largest private investment funds, with a focus on mining industry, innovative projects in energy and nanotechnology, real estate and other industries."

According to the web site, the consulting firm earned $5,000 from Onexim during July and August. For what isn't clear, but Prokhorov's foundation made a $1 million donation to the Brooklyn Academy of Music. Prokhorov held and event at BAM in the run-up to the September 28 opening of the Barclays Center.

Another Nets connection

Another client is Virtu Financial, an electronic trading firm, whose Chairman and CEO is Vincent Viola, former Chairman of the New York Mercantile Exchange (NYMEX) and a longtime minority owner of the Nets. The Brooklyn-born Viola was the connection that brought several investors to the Nets, including novelist Mary Higgins Clark.

According to the web site, the consulting firm earned $18,750 from Virtua from May through August.

Other clients

Other clients include the New York Yankees, the Association of Car Wash Owners, and the Albany government relations firm Cordo & Company. Only for the Yankees, among the five clients, is the subject lobbied disclosed: "regulation of ticket sales."

Lobbying fees aren't disclosed either, but presumably they're earning a good deal more than what's been reported so far.

What about the Nets?

Note that while Bender Cantone's web site indicates that the Brooklyn Nets are among the featured clients, the team is not listed on the lobbyist search site.

That may indicate that the Nets are not yet a formal client. Or it could be a reference to the lobbyists' past work, while at Forest City.

The firm's promise: "relationship that transcend political identity"

Bender and Cantone promise on their web site:

With 40 combined years of experience in public service and 20 years in the private sector, Bender Cantone Consulting offers clients comprehensive expertise and innovative approaches to solving problems. We are a proven and tested team that has successfully represented clients' interests in the community, in government and with the media.
As seasoned professionals representing our principals in Albany, City Hall and Washington D.C., we have developed long-term trusted relationships that transcend political identity and enables us to provide our clients the information and advice they need.

Indeed, one of the hallmarks of Forest City Ratner's work has been the company's influence on both sides of the legislative aisle. Of course strategic campaign contributions to both sides can't hurt, either.

Their record

Their website states:

Together, they have developed and implemented public affairs strategies for some of the City and State's most visible development projects: Atlantic Yards and Barclays Center in Brooklyn, New York by Gehry at 8 Spruce Street in Lower Manhattan, The New York Times Building in Midtown, East River Plaza Mall in Upper Manhattan, and Ridge Hill Village in Westchester, among others.

And yes, they're taking some credit for the arena.

The database

Convictions in Ridge Hill case upheld; judge's summation a reminder of Forest City's not-so-honorable behavior; in memo, Annabi's lawyer calls for probation, citing smothering family and ongoing responsibilities

From the New York Times, Judge Upholds Convictions in Yonkers Corruption Case, published online yesterday (and not in print):

A federal judge in Manhattan on Wednesday upheld the convictions of a former Yonkers councilwoman, Sandy Annabi, and a political operative who had testified that he had given her gifts out of love and not for corrupt reasons, as the government had charged.
Prosecutors had accused Ms. Annabi of taking about $195,000 in secret payments over the years from the operative, Zehy Jereis, in return for dropping her strong opposition to a proposed 81-acre luxury mall and housing complex in Yonkers called Ridge Hill, and a second project. The government had also contended that Ms. Annabi gave Ridge Hill her support in order to help Mr. Jereis obtain a no-show job from the developer, Forest City Ratner.
“The jury was entitled to conclude that the thing that changed Sandy Annabi’s mind about the Ridge Hill Project was her benefactor Zehy Jereis’ financial interest in getting the project approved,” the judge, Colleen McMahon of Federal District Court in Manhattan, wrote in her decision.
...Neither Forest City Ratner nor any of its employees were charged in the case. The developer has said it cooperated with the authorities throughout the investigation.

Forest City's deal

It's true that the developer cooperated, but McMahon's decision (bottom) reminds us that Forest City did not exactly behave honorably. (Here's my coverage of the case, including an analysis of why Forest City wasn't charged.)

Though Forest City agreed to pay more to Yonkers, a claimed concession to Annabi, "both supporters and opponents of the project testified that the extra $10 million that FCR agreed to pay was totally insignificant," McMahon wrote.

"The evidence showed that Jereis was indeed able to get FCR the private meeting with Annabi that it had been unable to arrange without his help," McMahon wrote. Five days later, they produced what then-Forest City executive Scott Cantone termed a "political parachute" for Annabi.

(Given testimony by Cantone and his boss Bruce Bender about unseemly though not illegal behavior, it's understandable why Bender left Forest City before the trial and Cantone soon after. They now run a consulting company, Bender Cantone Consulting, which relies on part on old ties for new clients.)

Jereis, as McMahon described it, then began hounding Forest City for a job, the $60,000 consulting contract for a no-show position. "In the end, the jury was entitled to conclude that the only relevant thing that changed about the Ridge Hill Project between December 2005 and June/July 2006 (or for that matter, between June 9 and June 15) was that Jereis now had a financial interest in getting the Project approved," she wrote.

And while McMahon agreed there was no evidence that Annabi was aware of Jereis's request to Forest City for a job before she flipped her vote, the jury didn't need to find that to reach a conviction, the judge noted.

Moreover, according to judge, "there was circumstantial evidence" for a jury to reach that conclusion, given the close political relationship between Annabi and Jereis and the fact they spoke 81 times on the day the two first met with Forest City.

Sentencing Nov. 19

Sentencing is scheduled for Nov. 19. In a voluminous memo, Annabi's lawyer, Edward Sapone, asks for probation, house arrest, and community service, not jail time, serving up a significant support for Annabi, with dozens of people citing her civic spirit and good works throughout her career.

As the Journal News reported:

Relatives called Annabi the rock of her family ever since she was a teenager, when her parents were arrested in a federal drug case. Her mother spent a year in prison and her father 13 years, forcing Annabi to work through high school and college.
Her dreams of becoming a prosecutor were dashed because financial hardships kept her from attending law school, relatives wrote.
Sapone suggested that Annabi was susceptible to Jereis’ political and personal efforts to gain her support, citing a psychiatrist’s assessment that she was naive when it came to others’ motivations.

Pulling at the heartstrings

The memo also pulls at the heartstrings. For example, it states that, as her grandparents' first grandchild born in the United States, "That status would prove to be detrimental to Ms. Annabi, who would be overly sheltered and deprived of life's experiences and the freedom to make small mistakes and to develop and grow in a healthy way."

They lived in an area overrun by gangs, and her parents were enormously protective, leaving her "little opportunity to test boundaries, experience life's situations, and establish relationships outside her family."

After her parents went to prison and even when her mother came back, Annabi was forced to grow up and be a virtual parent to her two younger brothers. Later, after her father returned from prison, Annabi, at 27, was still living with her mother and brothers:

Ms. Annabi's family continued to suffocate Ms. Annabi, and they simultaneously heavily relied on her. They tried to protect her while relying on her to protect them. Consequently, Ms. Annabi did not move out of her family's apartment until she was 34 years of age.

A friend said in a letter cited in the memo: "Everyone in her family leans on her. On the inside, Sandy is 80 years old--I know--I am her closest friend. It's not fair. She is worn out."

Learning from the mistake

Sapone's memo does acknowledge, "Ms. Annabi recognizes that she should not have accepted Mr. Jereis' gifts, and she has learned a lot from her mistake."

Meanwhile, Annabi's family relies on her to monitor her infirm parents' health, even as she "battles to control her own pain," including migraine headaches and other health problems.

"Additionally, the public does not need protection from Ms. Annabi," the memo states, citing "immense support" not only from those close to her but "from every segment of society."

On the other hand, Annabi doesn't apologize for flipping her vote--her defense was that the concession was worth it.

It will be up to the judge to decide how much the public needs protection from--or to make an example of--an elected official whose decision privileged corporate interests over the public interest.

McMahon's decision

Yonkers Corruption Case, Judge's Decision on Post-Trial Motions, 11/7/12