National News

Energy Executive Admits Lying About ‘Low-Show Job’ for Wife of Governor's Aide

Posted May 11, 2018 11:37 p.m. EDT

NEW YORK — A former energy executive admitted Friday that he had lied when he told his company that the governor’s office had approved his hiring of the wife of a former top aide to Gov. Andrew M. Cuomo.

The concession by the executive, Peter Galbraith Kelly Jr., as he entered a guilty plea in U.S. District Court for the Southern District of New York, was the latest chapter in a prolonged corruption investigation that led to the conviction of the aide, Joseph Percoco, and questions about the governor’s knowledge of the illicit activity.

Kelly, 54, stood trial this year alongside Percoco and two Syracuse-area developers on charges that they had funneled some $300,000 in payments to Percoco, formerly the governor’s executive deputy secretary, in exchange for his help negotiating profitable state contracts.

After a nearly two-month trial, Percoco was found guilty in March of soliciting bribes and conspiracy to commit honest services fraud.

But the jury failed to reach consensus on Kelly, who was accused of giving Percoco’s wife, Lisa Toscano-Percoco, a “low-show job” at his company to win Percoco’s help with a power plant the company was building upstate. The payment for that job, in which Percoco’s wife taught schoolchildren about energy, made up the bulk of the alleged bribes.

“I wanted to hire Lisa for a number of reasons,” Kelly told the judge Friday, “not the least of which was to further my relationship with Joe.”

On Friday, Kelly pleaded guilty to one count of fraud conspiracy. In court, he acknowledged he had lied when he told the head of his company, Competitive Power Ventures, that Percoco had secured a written ethics opinion permitting Toscano-Percoco to work there. (The company was pursuing business before the state.)

Geoffrey S. Berman, the U.S. attorney in Manhattan, called Kelly’s plea a victory for government reform.

“Corruption in Albany casts a shadow over the many honest public servants who do good work in the administration of government, and deprives the citizens of New York of the honest representation they deserve,” he said in a statement.

Had Kelly not pleaded guilty, the government could have chosen to retry him. He is to be sentenced by Judge Valerie E. Caproni on June 11.

Cuomo has resolutely denied that he knew of any illegal activity involving his former close aide. And prosecutors have not accused him of any wrongdoing.

But Cuomo’s political rivals have harped on the case as an example of the corrupt culture they say the governor has enabled. The chairman of the state Republican Party, Edward F. Cox, filed a state ethics complaint against Cuomo, claiming that Cuomo had turned a blind eye to Percoco’s backroom dealings. And Cuomo’s primary opponent, Cynthia Nixon, has repeatedly presented the trial as an indictment of the governor’s administration.

That culture will soon be thrust into the spotlight again. In June, a group of men will go on trial for an alleged bid-rigging scheme involving a billion-dollar development project in Buffalo. The defendants include Alain E. Kaloyeros, former president of the State University’s Polytechnic Institute and an ally of the governor whom Cuomo once said was “as close as I’ve ever come to dealing with a genius.”

Kaloyeros has pleaded not guilty.