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New York Pol Pleads Not Guilty in Federal Corruption Case

Former New York State Assembly Speaker Sheldon Silver, center, is surrounded by members of the media as he leaves a federal courthouse in New York, Feb. 24, 2015.
Former New York State Assembly Speaker Sheldon Silver, center, is surrounded by members of the media as he leaves a federal courthouse in New York, Feb. 24, 2015.

Former Speaker of the New York State Assembly, Sheldon Silver, pleaded not guilty to federal charges of fraud and extortion in a Manhattan federal courtroom on Tuesday.

The 71-year-old Democrat, who rose to Speaker in 1994, resigned the post after his January 22 arrest by FBI officials in a high-profile U.S. corruption sting.

“I am confident I will be vindicated in court," Silver, who is out of jail on $200,000 bail, told reporters shortly after his plea.

Silver has largely remained defiant since his arrest, refusing to give up the Lower East Side legislative seat he has held for 40 years.

The 25-page grand jury indictment handed up on February 19 accuses Silver of collecting nearly $4 million in corrupt payments via two entities, the “Real Estate Law Firm” and “Weitz & Luxenberg.” The three-count indictment says U.S. authorities seized $3.8 million in cash that Silver had tucked away in eight accounts at six different banks.

It says Silver collected some $700,000 in kickbacks by steering real estate developers with state-related business to “Real Estate Law Firm,” which is run by a former aide. The indictment also accuses Silver of collecting more than $3 million in payments from Weitz & Luxenberg, a Manhattan-based law firm that employed the state legislator. Documents say Silver funneled state grants to a physician — identified in the indictment only as “Doctor-1” — who directed asbestos claims to Weitz & Luxenberg, which paid Silver client referral fees. The indictment says Silver used his role as Speaker to secretly direct a half-million dollars to a research center run by the physician, along with additional benefits for the physician's family.

The federal grand jury also accuses Silver of making “materially false and fraudulent representations and omissions about his outside income, including but not limited to statements on his [official NY State] Disclosure Forms and statements to others concerning his outside income.”

“In addition,” the grand jury said, “from in or about 2013 to in or about 2014, Silver sought to prevent, and in fact prevented, the disclosure of information about his outside income to the Moreland Commission to Investigate Public Corruption.” That body was created in mid-2013 by New York Governor Andrew Cuomo “to probe systemic corruption and the appearance of such corruption in state government, political campaigns, and elections in New York State.”

'A show-me-the-money culture’

In announcing the charges against Silver, U.S. Attorney Preet Bharara said the indictment shows “the show-me-the-money culture of Albany, New York state’s capital, has been perpetuated and promoted at the very top of the political food chain.”

Shortly after the charges were unveiled, Bharara made a speech at a law school in which he called the case against Silver indicative of Albany's “cauldron of corruption," a place where governance is conducted by “three men in a room.”

After Silver entered his “not guilty” plea, one of his attorneys, Steven Molo, launched an attack on Bharara's statements. "The U.S. attorney excoriated [Silver] and basically deprived him of his presumption of innocence and extolled his guilt," he said.

Silver’s defense team entered a motion for dismissal of charges at the February 24 arraignment, arguing that Bharara’s statements make a fair trial impossible. U.S. District Judge Valerie Caproni, who is presiding over this case, did not take up that motion then, but federal prosecutor Carrie Cohen said the court would respond to it by March 6.

For decades Albany has been known as a place where a “to the victors belong the spoils” attitude prevails — on both sides of the aisle. Republican powerbroker Joseph Bruno, who held the post of Temporary Senate President in the capital from 1994 to 2008, and who was also Senate Majority Leader, was federally indicted in January 2009 on eight corruption counts, including wire and mail fraud. Bruno was also accused of taking $3.2 million in fees from entities that were seeking or conducting business with the state.

In 2010, Bruno was convicted and sentenced to two years in jail. A volley of appeals followed that conviction, leading to a 2014 retrial in which the Republican boss was found not guilty. Bruno's defense team subsequently triumphed in their demand that New York State foot his $2.4 million legal bill.

Meanwhile, Silver’s situation is shaking the Empire State's Democratic Party establishment with worries Bharara may probe other politicians. One unidentified top Democratic figure told the New York Post, “There’s a lot of people scared s---less because [Silver] covered up for a lot of people. Many big players in the political circles are worried the dominoes are going to fall hard.”

Indeed, Bharaha has publicly stated that “our unfinished fight against public corruption continues. Stay tuned.”

U.S. District Court Judge Valerie Caproni did not set a date for the start of Silver's trial, but a procedural hearing in the case is set for May 7.

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    Jeffrey Young

    Jeffrey Young is a Senior Analyst in VOA’s Global English TV.  He has spent years covering global strategic issues, corruption, the Middle East, and Africa. During most of 2013, he was on special assignment in Baghdad and elsewhere with the Special Inspector General for Iraq Reconstruction (SIGIR).  Previous VOA activities include video journalism and the “Focus” news analysis unit. He also does journalist training overseas for VOA.