National News

Silver Retrial Revisits Fraud Case

Posted April 30, 2018 10:54 p.m. EDT
Updated April 30, 2018 11:01 p.m. EDT

NEW YORK — The fourth-floor courtroom in Manhattan was the same as the last time, as was the judge and, most important, the defendant: Sheldon Silver, the once-powerful speaker of the New York state Assembly.

On Monday, the retrial of Silver, 74, on public corruption charges began in U.S. District Court, with Silver sitting at the defense table, a few years older, but with much of the case’s contours unchanged.

A prosecutor told the jury in an opening statement that Silver had obtained nearly $4 million in illicit fees in exchange for using his official position to benefit a cancer researcher, Dr. Robert N. Taub at Columbia University, and two real estate developers.

“Remember, the money that Silver sent to Dr. Taub, it wasn’t his own money,” the prosecutor, Damian Williams, told the jury, referring to state grants that Silver had steered to Taub. “It was the people’s money. He used that money to make a fortune for himself.”

Silver’s lawyer, Michael S. Feldberg, in his opening statement, said the evidence would show that there was no corrupt agreement, quid pro quo or bribe involving his client.

“Everything that happened in this case was not only legal,” Feldberg said, “it was designed to — and did — help people.”

“It is just not a crime to be a politician, even a powerful one,” Feldberg added.

Silver’s retrial is being watched as a test of the new rules for corruption prosecutions, as handed down by the U.S. Supreme Court.

Silver was convicted in November 2015, after a five-week trial, of charges that included honest services fraud, extortion and money laundering. Two weeks later, Dean G. Skelos, the Republican majority leader of the state Senate, was convicted in a separate corruption trial. Both men forfeited their seats upon their convictions.

The trials exposed Albany’s culture of secrecy, nepotism and influence peddling. But the convictions of Silver and Skelos were overturned last year on appeal, after the Supreme Court, in vacating the conviction of a former governor of Virginia, Bob McDonnell, narrowed the kind of quid-pro-quo actions that could constitute corruption.

The Supreme Court held that official action must involve concrete and formal government actions or decisions and not mere political courtesies, like setting up a meeting.

The appeals court ruled that the jury instructions at Silver’s trial were erroneous, and that a properly instructed jury might not have convicted him. Prosecutors vowed to retry both former New York lawmakers; Silver’s trial went first.

In one scheme outlined for the jury, prosecutors said Silver had arranged to have the state Health Department award two grants totaling $500,000 to Taub. In return, the government alleged, Taub sent cancer patients with legal claims to a law firm, Weitz & Luxenberg, which sent a portion of its fees to Silver.

“Dr. Taub was Silver’s golden goose,” the prosecutor, Williams, said.

Taub said on Monday that before he began referring cases, he was told by a mutual friend that “Shelly wants cases,” adding, “That was the wording that I had heard.”

In a second scheme, the government charged that Silver arranged to have the two developers, Glenwood Management and the Witkoff Group, send tax business to a law firm, Goldberg & Iryami, which also gave Silver a portion of its fees. Silver then supported real estate legislation that benefited the developers, prosecutors said.

Silver, a Democrat who represented the Lower East Side of Manhattan, served for more than 20 years as the Assembly speaker. “He had no rivals, no peers in the Assembly,” Williams said. “And because of that tremendous power, he was practically untouchable. But he was also corrupt.”

In the courtroom, Silver was attentive and at times animated. He shook hands and chatted with people he knew in the seats behind him. At one point, he approached the three artists who would be sketching him, his arms out and palms up, and asked in his thick New York accent, “How we doin’, huh?”

The prosecution appeared to use its first witness, Amy Paulin, a Democratic assemblywoman from Westchester County, to bolster its depiction of Silver’s influence and lack of accountability.

Paulin was asked if, considering Silver’s access to discretionary funds, she knew that he had dispersed large sums of public money to entities he favored.

“It was assumed he would, but we never heard which ones,” she said, adding, “It was not transparent.”

Paulin said that she had asked Silver for $3 million for a widely backed measure to fight sex trafficking. She recalled his response when she later asked him why the money had not come through.

“His words were something to the effect of, ‘You do for me, I do for you,'” Paulin said.