'Eyes and ears' called key

NEW YORK _ The Cuomo administration allowed Alain Kaloyeros to keep his position atop SUNY Polytechnic Institute on the condition that lobbyist Todd Howe _ already a convicted felon _ serve as the "eyes and ears" of the governor's office on campus, a former school spokesman testified Wednesday.

David Doyle, a former senior press officer for Gov. Andrew Cuomo and later SUNY Poly, told jurors at Kaloyeros' bid-rigging trial in Manhattan federal court that Kaloyeros told him when the governor took office in 2011, administration officials had "reservations" about Kaloyeros, whose college was getting enormous funding.

"They weren't sure if they wanted to continue to work with him," Doyle told Assistant U.S. Attorney Robert Boone. He said Kaloyeros made a successful case to stay _ so long as he allowed Howe to be the administration's "eyes and ears."

Doyle said the arrangement involved Howard Glaser, one of the governor's top aides at the time and a longtime associate of Howe, whose ties to the Cuomo family went back decades. Howe, a now eight-time felon, worked for late Gov. Mario Cuomo and later his future governor son when Andrew Cuomo served as federal housing secretary for President Bill Clinton.

Howe gave orders and, "he certainly was connected with the governor's office and seemed to have the trust of Dr. Kaloyeros," Doyle said.

Howe was based in Washington, D.C. running a subsidiary of Whiteman Osterman & Hanna, the firm Howe worked for and stole from. In 2010, Howe pleaded guilty to defrauding the firm $45,000 but remained an employee for six more years.

A spokesman for Cuomo's office declined comment, citing the trial.

Doyle's revelation came as federal prosecutors came close to resting their case against Kaloyeros and three co-defendants charged. Doyle was expected to be cross-examined Thursday, after which the government could rest.

Howe testified for prosecutors in their trial earlier this year against former top Cuomo aide Joseph Percoco. He has not been called to testify in this case but Kaloyeros attorney Reid Weingarten had hinted he could call Howe. Under an unusual arrangement, the judge and prosecution appeared willing to allow the defense to read some of Howe's testimony from the Percoco trial to illustrate his shady history.

Prosecutors for Manhattan U.S. Attorney Geoffrey Berman contend Kaloyeros rigged bids on more than $850 million in SUNY Poly-related contracts for allegedly favored developers - LPCiminelli in Buffalo and COR Development in Syracuse.

The bids were part of Cuomo's Buffalo Billion initiative to revive upstate cities. Howe was consulting for COR, a job he also did for LPCiminelli.

Kaloyeros, 62; LPCiminelli President Louis Ciminelli, 62; COR President Steve Aiello, 60, and COR General Counsel Joseph Gerardi, 58, are all charged with wire fraud and wire fraud conspiracy. Gerardi is also charged with lying to the FBI.

Wednesday's testimony featured allegations that Kaloyeros and Ciminelli deleted emails. Doyle testified Kaloyeros and Howe were using Wickr, a private cell phone app to delete text messages, and that he began using it as well.

"What was going on during this time period?" the prosecutor asked.

"The investigation," Doyle answered.

Prosecutors contend Kaloyeros, while not enriching himself, engaged in bid-rigging to maintain his status with the administration.

Hiring Howe through his firm allegedly aided that effort. Doyle said he considered Howe a supervisor and that Howe was involved in decision-making and became close to Kaloyeros.

Doyle, now a vice president at Gramercy Communications in Troy, testified that when Jim Heaney, an investigative reporter, began writing stories and making requests into the Buffalo Billion bidding process via the Freedom of Information Law, Kaloyeros and Howe engineered a countersuit against him and sought to find out who was contributing money to the journalist.

One of the contributors had been Ciminelli, Doyle said. In one email, Howe said, "All I can say is payback is a bitch."

In September 2015, Doyle said Kaloyeros wanted to issue a press release saying Kaloyeros was not a target of any investigation and that the news reports were part of a "misguided attack on the governor."

Howe later weighed in by email, saying, "Gents - is this wise? David, should you run by gov's office? Rich, should outside counsel approve?"

David was a reference to Doyle, Rich to Rich Leckering, Howe's boss at Whiteman Osterman & Hanna.

In April 2016, the same month Howe's home was raided as part of the investigation and he was arrested, Politico reporter Jimmy Vielkind contacted SUNY Poly to see if Howe was still working there as a consultant.

At Kaloyeros' instruction, Doyle testified, he told the reporter Howe had no direct relationship with SUNY Poly but was simply "one of a number of individuals at Whiteman Osterman & Hanna who are assigned to assist SUNY Poly in legal, business and strategy matters."

Earlier, Special Agent Justin Ellard, who works for the U.S. Attorney's office in Manhattan, testified that several emails between Kaloyeros and Howe were found in a preserved email box, but not in a newer repository - an indication they were deleted.

The emails included exchanges from Aug. 23, 2013, when Kaloyeros emailed Howe with "vitals" _ a reference to information Kaloyeros allegedly included in "requests for proposal" or RFPs to unfairly steer state contracts to LPCiminelli and COR Development.

The emails discussed at Wednesday's testimony hint at the comfort level Kaloyeros and Howe shared with one another. Howe leaned on gangland-style lingo in one exchange about an article written by Vielkind. On Sept. 18, 2015, Vielkind sent an email to Howe in which the reporter wrote, "subpoenas! Give me a call."

Howe replied to Vielkind that some reporting on the story was inaccurate. "Read that last paragraph," Howe wrote. "Your story reported incorrectly. If it isn't changed, change it."

Howe then described the correspondence in an email with Kaloyeros.

"I love you, I really do," Kaloyeros wrote back.

"Family. You don't (expletive) with members of the family," Howe replied.

The state contracts at issue were approved by SUNY Poly's nonprofit development arm, the Fort Schuyler Management Corp., which issued RFPs to find preferred developers in Buffalo and Syracuse for regional projects.

Neither the Syracuse nor the Buffalo RFP was issued before October, but emails showed communications between Kaloyeros and Howe, as well as Kaloyeros and Ciminelli, long before that.

Federal prosecutors have presented evidence showing that executives with COR and LPCiminelli dictated specific qualifications and language in the RFPs to suit their companies and assure they won the bids. They call it an illegal violation of a process that is supposed to be open and competitive.

On Wednesday, the agent testified that Ciminelli appeared to delete at least eight emails exchanged with Kaloyeros between Sept. 9, 2013, and Sept. 10, 2013.

That included a Sept. 9, 2013, email in which Kaloyeros sent Ciminelli a draft copy of an RFP used by COR and wrote: "Obviously we need to replace Syracuse with Buffalo and fine tune the developer requirements to fit."

One of the allegedly deleted emails by Kaloyeros was on Sept. 23, 2013, when Kaloyeros complained to Howe: "These vitals are not unique to Lou's company."

Based on a stipulation between prosecutors and the defense, both appeared to agree there would be a presumption the emails were deleted by the email account user.