Key Witness in Albany Corruption Trial Is Jailed

NEW YORK — Todd R. Howe, the star prosecution witness in a sweeping corruption trial centered on Albany, was arrested Thursday night, just hours after he admitted in court that he had violated the terms of his cooperation deal.

The arrest of Howe, a former lobbyist and loyalist to Gov. Andrew M. Cuomo and his father, was a stunning development in the case against Joseph Percoco, a former top aide to the governor, and three other defendants.

One provision of Howe’s cooperation deal was that he “commit no further crimes whatsoever.” But on Thursday, Howe, under a grueling cross-examination, acknowledged that he tried to defraud a credit card company after his cooperation agreement had been finalized.

Prosecutors often rely on witnesses whose admissions of past crimes could weaken their credibility. Salvatore Gravano helped the government bring down nearly 40 gangsters — most notably John J. Gotti — even though Gravano had admitted his participation in 19 murders.

In other cases, jurors’ concerns about the credibility of the witness have led to mistrials.

But to have a government witness arrested midway through cross-examination is extremely uncommon, and poses a problem for prosecutors when the trial resumes Monday and Howe’s cross-examination is scheduled to continue.

The arrest is the latest obstacle prosecutors have encountered in pursuing corruption cases in Albany: The government is retrying two prominent former state leaders, Sheldon Silver and Dean G. Skelos, after their 2015 convictions were overturned last year in light of a Supreme Court decision that narrowed the legal definition of corruption.

Howe struck his cooperation deal in September 2016, and assisted the government in its investigation of Percoco and alleged bribery schemes involving companies doing business with the state.

On Thursday, the second day of cross-examination, Howe was questioned about one of his numerous trips to New York in 2016, where he stayed at the Waldorf Astoria Hotel, to meet with prosecutors in preparation for the cooperation agreement.

Howe said on the stand that in October, several weeks after he signed his deal, he called his credit card company and claimed that he had not stayed at the Waldorf, and asked that the $600 hotel charge be credited back to him.

“You lied to your credit card company about staying at the Waldorf the very night that you had come to New York to see the government?” a defense lawyer, Daniel M. Gitner, asked Howe on cross-examination.

“Correct,” Howe replied.

“As you sit here now,” Gitner said, “do you realize that you are in violation of your cooperation agreement?”

“I do, looking at this, yes,” said Howe, who had been shown a copy of the agreement.

“As you sit here now, do you think they’re going to rip it up?” Gitner asked.

“I sure hope not,” Howe replied.

Late Thursday, after the day’s proceedings had ended, Judge J. Paul Oetken granted a government request that Howe’s bail conditions be revoked, a court filing shows. Howe was then arrested at his hotel room and taken to the Metropolitan Correctional Center in lower Manhattan.

“He was remanded for violating the terms of his bail,” said Nicholas Biase, a spokesman for the U.S. attorney’s office in Manhattan. “No additional charges have been filed.”

The government declined to comment on how Howe’s arrest might affect its trial strategy.

A bedraggled Howe, wearing a faded Martha’s Vineyard T-shirt, his graying hair mussed, appeared briefly Friday before a magistrate judge, Stewart D. Aaron, who advised him of his rights as Howe nodded slightly.

A prosecutor, Janis Echenberg, told the judge that Howe had consented to be held without bond.

After the hearing, Howe’s lawyer, Richard J. Morvillo, asked by reporters whether Howe would be returning to court Monday to continue testifying, called it an “interesting question.”

“I’m planning to be here Monday morning,” Morvillo said.

Asked how his client was doing, Morvillo added, “I’m sure you can imagine.”

Lawyers for Percoco and his co-defendants either declined to comment or had no comment on Howe’s arrest, which was reported Friday by The Wall Street Journal.

Howe, an old friend of Percoco’s, pleaded guilty in 2016 to charges that included extortion, fraud and conspiracies to commit honest services fraud and bribery. He has been cooperating with the government against Percoco and three executives of two firms, COR Development and Competitive Power Ventures, who are also on trial. Cuomo, a Democrat who is running for re-election, has not been accused of any wrongdoing.

Percoco has been charged with obtaining at least $315,000 in bribes from the executives, paid to Percoco’s wife through a third party and through a company operated by Howe, in return for Percoco’s taking official actions on the firms’ behalf.

Prosecutors have been candid about the questions concerning Howe’s credibility. During opening statements, a prosecutor, Robert L. Boone, pre-emptively told the jury that Howe was a criminal who had pleaded guilty to eight felonies, many of which related to him telling lies.

“He has lied to his employer, he has lied to the IRS, and he’s even lied to the defendants. He will tell you all about it,” Boone said.

But under questioning by Gitner, who represents one of the executives charged in the case, Peter Galbraith Kelly Jr., Howe seemed to admit to lies that the government had not been aware of.

He acknowledged, for example, that in applying in 2014 for a disability insurance policy, he checked a box stating that he had never been convicted of a felony, even though that was not true.

“And the government is hearing about that for the first time right now?” Gitner asked.

“Yes,” Howe said.