06.13.2011

Day 6: Cordaro’s financial dealings take center stage

BY BORYS KRAWCZENIUK (STAFF WRITER)

Former Lackawanna County Commissioner Robert C. Cordaro earned a fee on the  county ski resort sale, paid almost $100,000 in cash to buy himself new  vehicles, sought to hide his Dunmore home’s real purchase price and wanted  political opponents’ support to continue their county tax collection contract,  witnesses testified Monday in federal court.

As the federal corruption trial of Mr. Cordaro and Commissioner A.J. Munchak  goes into its second week, another witness testified Monday that he gave Mr.  Munchak $500 cash that other evidence showed was never reported on the finance  reports of Mr. Munchak and Mr. Cordaro’s campaign committee.

With the largest part of their case out of the way, federal prosecutors  kicked off Monday with Michael Conflitti, the former owner of Northeast Credit  and Collections and later a consultant for the company that bought his business,  Commonwealth Financial Services.

Mr. Conflitti testified Commonwealth had the contract to collect county  delinquent real estate taxes, but eventually cancelled the deal because Mr.  Cordaro was insisting on company owners’ political support.

In his first meeting with Mr. Cordaro after the commissioner and Mr. Munchak  were elected majority commissioners, Mr. Conflitti testified Mr. Cordaro  promised the company could keep the work if it did a good job, but wanted the  political support from Commonwealth’s owners, who included attorney Larry Moran,  William Conaboy, Dick Conaboy and Edwin Abrahamsen, all prominent Democrats,  plus Dennis Corvo, Vince Scarpetta and John Kotula.

Mr. Conflitti said Mr. Cordaro singled out Mr. Moran, the lawyer for  Democratic former Commissioner Joseph Corcoran, whom Mr. Munchak and Mr. Cordaro  defeated in the 2003 election.

“He knew the people behind my company were large supporters of his opponents  both financially and politically so he wanted those guys to be on his side now  both politically and financially,” Mr. Conflitti said.

Mr. Conflitti testified he was unsure whether he or Mr. Cordaro brought up  having a fundraiser for the two Republican commissioners, but bounced the  fundraiser idea off Commonwealth’s partners who refused.

On Aug. 31, 2004, the county Tax Claim Bureau sent Commonwealth a letter  saying its services were no longer needed, according to a copy of the  letter.

Mr. Conflitti, whose consulting job was to ensure the company keep its county  contract, said he met with Tax Claim Bureau Director Thomas Harrison, who said  Mr. Cordaro was concerned about the 25 percent fee the company added on to the  bills of delinquent taxpayers. Later that day, Mr. Munchak said the company  would keep the contract.

More than a month later, he met with Mr. Cordaro and in notes he kept at  company owners’ direction wrote, “He (Mr. Cordaro) wanted to make sure all the  owners are in his corner.”

In late November 2004, they met again and, according to Mr. Conflitti’s  notes, Mr. Cordaro reminded him of their first meeting eight months earlier and  his offer to give Commonwealth a chance to “come on board and as of today he had  heard nothing.”

Further meetings followed, but after a Feb. 11, 2005 meeting with Mr.  Cordaro, Mr. Conflitti’s efforts had failed.

“For many months, Commissioner Cordaro has been saying that he wanted some  sign that the owners of Commonwealth would be on his side,” he wrote in his  notes.

Mr. Conflitti said he and Mr. Corvo made $1,000 contributions to the  Munchak-Cordaro campaign, but no other partners in Commonwealth did and the  company cancelled its contract with the county.

Under cross-examination by Mr. Cordaro’s lawyer, attorney Jerry Johnson, Mr.  Conflitti agreed that the relationship between Mr. Moran and Mr. Cordaro, in Mr.  Johnson’s words, had “bad blood for political reasons” and that Mr. Cordaro told  him Mr. Corvo had “bad-mouthed” the commissioner at the Country Club of  Scranton.

Mr. Conflitti, who had immunity from prosecution if he testified truthfully,  acknowledged he did not know what Mr. Cordaro meant in his notes by the term “in  his corner.” He also said he did not believe he was paying a bribe or being  extorted.

Asked by Mr. Munchak’s lawyer, attorney Christopher T. Powell, if it was true  that Mr. Munchak had little to do with the contract and never asked for cash,  campaign contributions, kickbacks or bribes, Mr. Conflitti replied, “correct,”  each time.

But on re-direct questioning, Assistant U.S. Attorney Bruce Brandler asked  Mr. Conflitti what he meant in a note referring to a conversation as the  commissioner was leaving a meeting between the two.

“He said ‘If we (referring to the two commissioners) could start getting some  contributions’, we (Commonwealth) could have some business,” Mr. Conflitti  testified.

“So he did ask you for contributions? Is that correct?” Mr. Brandler  asked.

“That’s correct,” Mr. Conflitti replied. “We did talk about contributions. I  don’t know if I brought it up or he brought it up.”

On re-cross examination, Mr. Johnson pointed out that one note said nothing  about contributions.

Mr. Conflitti agreed.

Jurors also heard Mardi Steppacher, the bookkeeper for her attorney husband,  attorney William C. Steppacher, testify he paid Mr. Cordaro a $4,908.18 fee for  referring title search work on the county ski resort sale to him.

The county sold the resort to Sno Mountain LP in 2006 for $5.1 million. Title  searches are done prior to sales to ensure money is not owed to others on the  land.

The referral fee practice is standard among lawyers, but Assistant U.S.  Attorney William Houser guided Mrs. Steppacher through documents that reminded  jurors Mr. Cordaro was a county commissioner and the county sold the land. Mr.  Cordaro called her to say she made an error and actually paid him too little so  she issued a check for another $981.64, she said.

Under cross-examination by William C. Costopoulos, Mr. Cordaro’s other  lawyer, Ms. Steppacher blamed herself for the error, and said Sno Mountain paid  the fee, not county taxpayers. She told Mr. Powell that Mr. Munchak received no  similar fee.

Anthony Domiano, co-owner of Tony Domiano Auto Dealerships Inc., said Mr.  Cordaro paid $98,000 in cash for a 2005 Chrysler 300 and a 2007 GMC Yukon Denali  XL in separate deals in 2005 and 2006.

Much of the cash was in $100 bills or higher, according to prosecution  documents, a critical point because previous witnesses testified to paying  bribes in $100 bills.

Under cross-examination, Mr. Domiano said Mr. Cordaro made no attempt to  conceal paying with cash.

Shawn Tuffy, who sold Mr. Cordaro his home at 57 Tiffany Drive, Dunmore,  testified Mr. Cordaro suggested two sales agreements for the home – one for  $350,000, the other for $700,000, which was labelled “amended.”

The lower price agreement was signed by Mr. Cordaro, but the higher listed  the buyer as “Robert Co” and was signed that way. Mr. Tuffy said he witnessed  the commissioner sign both.

Mr. Tuffy acknowledged he and his wife, Christine, are targets of an  unspecified federal investigation and he is testifying with limited immunity –  his testimony could not be used against him, but that it could be used to  question others whose testimony could be used against him.

His testimony is scheduled to continue today.

Automobile dealership owner John Grow said he asked Mr. Munchak in April 2003  to be appointed to the county stadium authority board and later gave Mr. Munchak  $500 in cash – five $100 bills in an envelope – at a campaign fundraiser  featuring the commissioner’s nephew, Mike Munchak, a former professional  football player.

The money does not appear on the Munchak-Cordaro campaign committee’s  campaign finance reports, according to prosecution documents.

Just two months after Mr. Munchak and Mr. Cordaro were indicted, Mr. Munchak  invited him to dinner at Russell’s Restaurant in Dunmore where they discussed  the $500.

“He said, ‘I don’t remember getting it, but if you said I got it, I got it,'”  Mr. Grow testified.

In January 2004, Mr. Grow got the board appointment, and was appointed board  chairman a year later after Munchak-Cordaro appointments gained the board  majority. At Mr. Cordaro’s request, the board fired the stadium’s previous  concessionaire, S&W Management, because of its questionable practice of  asking for county money upfront to fund its operations, Mr. Grow testified.

Mr. Grow said he agreed to be chairman if the authority could run the stadium  like a business, but Mr. Cordaro, without bidding it out, negotiated the deal  with a new concessionaire, Concessions Plus Inc., co-owned by Glenn Gress and Al  Hughes. Believing he was becoming nothing more than “a figurehead,” he resigned  from the board, Mr. Grow testified.

On cross-examination, Mr. Grow said he never felt as if the $500 cash was a  payment to gain his position on the board, never felt extorted and the  commissioners never stopped his dealership from fixing county cars.

Another witness, Al Magnotta, former owner and president of CECO Associates,  a Scranton engineering firm, told of a separate $500 cash contribution to Mr.  Cordaro. The contribution was in cash because his firm had county work and did  not want to anger Mr. Corcoran by having it appear on campaign finance  reports.

On cross-examination, Mr. Magnotta acknowledged telling the FBI only that he  “may have made a contribution in 2003.”

“At the time, I wasn’t clear about the question,” he testified.

He said Mr. Cordaro never asked him for the contribution.

“You offered it?” Mr. Johnson asked.

“Yes,” he said.

Later, after CECO was appointed county engineer, he gave more than $20,000 to  the Munchak-Cordaro campaign.

“I felt we were part of the county team, part of the Cordaro-Munchak  administration,” Mr. Magnotta said. “I thought it was proper to support  them.”

He said Mr. Munchak never asked for or received a contribution.

Large construction projects – the courthouse renovations, the new 911 center  and others – have been a key focus of the case.

One witness suggested Mr. Cordaro was contemplating construction within days  of being elected to the majority.

John P. Heim Jr., owner and president of A.J. Guzzi General Contractors, said  Mr. Cordaro’s brother, Ronald, called him a day or two after the election,  reminding him he bet on “the wrong horse” in the election, Mr. Corcoran.

“I’m going to give you the opportunity to bet on the winning horse after the  election is over,” Ronald Cordaro told him, Mr. Heim testified. “We’re going to  be doing a lot of construction and we’re looking for donations to the  campaign.”

Mr. Heim said he had his wife write a campaign contribution check for $3,000  or $5,000 and put it on the kitchen table. Three days later, he shredded it.

“I didn’t want to be paying for construction work,” he said.

Mr. Heim testified he had county work under Mr. Corcoran, but none under Mr.  Cordaro and never had an opportunity to bid because of a lack of notice.

Under cross-examination, Mr. Heim acknowledged he could not explain why a  $151,000 contract to renovate the Abingtons Senior Citizens Center during the  Munchak-Cordaro administration did not appear on a list of county contracts he  provided to prosecutors.

Contact the writer:  bkrawczeniuk@timesshamrock.com

Read more: http://thetimes-tribune.com/news/day-6-cordaro-s-financial-dealings-take-center-stage-1.1161406#ixzz1Qbjow9Id

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