City Hall, Davis are targets of investigations
Federal authorities, DA, state troopers launch probes
State police and the Erie County district attorney have launched a criminal investigation into the financial dealings of Ellicott Common Council Member Brian Davis, and federal authorities, including the FBI, are scrutinizing City Hall for other potential wrongdoing, The Buffalo News has learned.
The Davis inquiry was triggered by allegations that he has a history of writing bad checks and his repeated failure to file financial disclosure reports with the Board of Elections.
Federal investigators, meanwhile, are reacting to an audit that uncovered problems with the city’s management of anti-poverty funds and a series of investigations published by The News.
“We are following the information,” Acting U. S. Attorney Kathleen Mehltretter said. “I’m talking about the HUD audit process; I’m talking about information from public sources including The Buffalo News; I’m talking about information that has come to the attention of the FBI.
“It is the Department of Justice’s policy that we do not confirm or deny investigations. Therefore, I can’t comment on what areas we are investigating,” she said.
One source with knowledge of the federal investigation said it involves, at least in part, the FBI’s Government Corruption Unit.
Federal investigators have obtained information related to Davis, the One Sunset restaurant deal, the city’s block grant spending and allegations of inappropriate activity related to Brown’s re-election campaign.
Brown’s spokesman, Peter K. Cutler, declined to comment. Davis did not return a telephone call seeking his comment.
Erie County District Attorney Frank A. Sedita and Lt. William D. Saunders, head of the State Police Special Investigations Unit, declined to confirm or deny the investigation their offices are conducting of Davis, a political ally of the mayor.
But sources familiar with the investigation said state police investigators have been on the job about two weeks, conducting interviews and reviewing financial documents.
The News reported in February that Kevin Brinkworth had filed a complaint with Buffalo police saying Davis wrote him a $3,500 check that bounced to cover one month’s rent at One Sunset. The restaurant on Delaware Avenue was started with the help of city loans and grants. Buffalo police subsequently ruled the check was a civil matter, rather than a criminal complaint.
Artvoice, a local alternative weekly, has reported claims by the owners of several inner-city corner stores that Davis had written bad checks at their businesses.
A News investigation in April found Davis has a history of financial difficulties.
Creditors, including state tax officials, have filed five liens with the Erie County clerk and five lawsuits in Buffalo Small Claims Court against Davis in an effort to obtain payment of $22,456 in debts, public records show. Some $8,018 of that has yet to be paid, records show.
Financial woes
In addition, Davis has gone through personal bankruptcy, his Council wages have been garnisheed, apparently for child support, and the state suspended his driver’s license in 2007 for lapsed insurance. The licence was restored April 27, about two weeks after The News’ story ran.
Davis also has run afoul of the local and state Board of Elections.
During his first four years in office, the Erie County Board of Elections wrote him seven times about his failure to file financial disclosures for 14 reporting periods. In November 2004, a letter chided him for “severely delinquent” filings.
Starting in 2006, candidates were required to submit disclosure reports to state election officials in Albany. Davis failed to submit reports that year but filed reports in 2007 and January 2008. According to records, he’s filed nothing since, including reports due July 2008 and January of this year. The state Board of Elections froze his campaign account in February 2008.
Davis has not taken corrective action since The News’ story ran.
“We still haven’t received anything,” said Bob Brehm, spokesman for the state Board of Elections.
In May, The News reported that Davis had falsified his resume, claiming a college degree he did not earn.
While Davis has caught the eye of the FBI, federal investigators are taking a much broader look at City Hall.
The city’s use of Community Development Block Grants is a topic of prime interest. The U. S. Department of Housing and Urban Development issued a report in March that found 19 deficiencies in the city’s management of the program, which provides the city with about $22 million a year to deal with poverty and blight.
The HUD review found the city spent too much of the block grant on paying the salaries and benefits of city employees, has made questionable loans to upscale housing developments and continues sloppy oversight of anti-poverty funds.
The Brown administration’s first response was to criticize HUD for making the report public and to ask federal officials in Washington to silence Stephen Banko, head of HUD’s office in Buffalo, after he criticized the city’s management of the program in Artvoice.
The city has since agreed to a HUD offer to provide technical assistance to correct problems.
Agencies under fire
In the meantime, the Common Council has been forced to resort to using the Freedom of Information Law to obtain information from the Brown administration about the program. And members believe further federal examination is required.
Last month, in a 5-4 vote, the Council asked HUD Inspector General Kenneth
M. Donohue Sr. to audit spending and lending practices at the city’s two economic development agencies, the Buffalo Economic Renaissance Corp. and the Buffalo Urban Renewal Agency.
The agencies have come under criticism in recent months.
BURA, which is headed by the mayor and controlled by his appointees, selected a team headed by former Council President James W. Pitts to develop a waterfront hotel, a move criticized by several Council members and many nearby residents. Five of six members of a review panel gave a substantially higher score to an alternative proposal submitted by developers Paul Ciminelli and Mark Hamister.
BERC, which Brown also heads, is the subject of an audit by City Comptroller Andrew SanFilippo triggered by a News investigation published in May that detailed the agency’s role in providing $160,000 in public loans and grants to One Sunset and the involvement of BERC Vice President Michelle Barron in its operation. One Sunset closed in December after being in business just a year and has left behind a trail of more than $230,000 in debt.
Last week, The News reported that BERC staff, without board approval, expanded its health insurance options in a way that allowed agency President Brian Reilly to put the woman he lives with on his policy. The mayor subsequently demanded that Reilly step down as BERC president, while staying on as commissioner of economic development, permits and inspections.
SanFilippo said last week he wants his office to begin exercising day-today oversight in the operations of BERC and BURA.
Also last week, The News reported that Tanya Perrin-Johnson, the city’s commissioner of community services, has sent a series of e-mails to about 20 members of her staff suggesting she expected them to work on Brown’s reelection campaign. The e-mails appear to violate a City Charter provision that prohibits coercion of civil service protected employees to perform campaign work. Questions also have been raised as to whether the e-mails represent a violation of the federal Hatch Act, which prohibits political activity by employees paid with federal funds.
Kearns’ requests
South Council Member Michael Kearns, who is challenging Brown in the Sept. 8 Democratic primary, attempted to submit a request with the Council last week to ask the city’s Ethics Commission to investigate. He was blocked on technical grounds by Masten Council Member Damone Smith, an ally of the mayor.
Kearns instead filed a request for an investigation with Douglas Coppola, chairman of the Ethics Committee. Kearns made a similar request to the state Commission on Public Integrity.
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