A federal judge again postponed former Town of Oyster Bay Commissioner Frederick Ippolito’s sentencing Tuesday for tax evasion connected to fees received from a paving contractor, saying that information received from Ippolito and town officials about their relationship with the company was too vague and only raised more questions.
In postponing the sentencing in his Central Islip courtroom, U.S. District Judge Leonard Wexler also said he intended to give Ippolito a higher sentence than the one reached in a plea deal.
Ippolito, 77, of Syosset, agreed to a plea bargain in January calling for a sentence of between 18 to 24 months for tax evasion in connection with failing to report to the IRS $2 million. Federal prosecutors said he received the money as an outside consultant for the paving contractor, Carlo Lizza & Sons and the Lizza family trust.
In court Tuesday, Wexler referred back to his comments in July when he first postponed Ippolito’s sentencing to express his views nearly six weeks later.
“I previously said, ‘there is something rotten in the Town of Oyster Bay,’ ” Wexler said. “I now conclude not only is it rotten, but it smells.”
Wexler set Sept. 28 for Ippolito’s next sentencing hearing, allowing his attorney, the town and federal prosecutors to file further briefs.
In July, the judge postponed the sentencing hearing and threatened to increase Ippolito’s sentence after saying he wanted to know whether payments the Lizza company made to Ippolito influenced how the town awarded paving contracts and what control he had over those contracts. In the July 13 hearing, Wexler noted that federal prosecutors Catherine Mirabile and Raymond Tierney said the Lizza company has received millions of dollars in town paving contracts.
He also wanted Ippolito to account for the $2 million he collected from the contractor since he said he could not afford to pay taxes owed.
After the July hearing, Ippolito’s attorney, Brian Griffin of Garden City, said his client would honor the judge’s requests.
“The judge wants answers, we intend to give them to him,” Griffin said at the time.
Wexler said Tuesday he found it “ridiculous” that town officials did not see that Ippolito’s work for both the town and Lizza was a conflict. Ippolito was the former town commissioner of planning and development.
Wexler said that in the new information provided to him by Ippolito, the former commissioner “does not admit” to handling any Lizza matters involving the town and Ippolito said “it does not matter” because, in any event, he disclosed his consulting income in filings with the town.
The judge said, “The Town Board . . . says they never received the defendant’s filings, but they knew that he had a personal interest with the Lizzas and received money from them.”
“So who did the defendant file with? I have no idea. And nobody tells me. And who reviewed it? I have no idea. And nobody tells me,” Wexler said.
Griffin said later in an email that “in compliance with the Town of Oyster Bay code, Mr. Ippolito filed his financial disclosure forms with the Town of Oyster Bay Board of Ethics.”
The judge said the town board now maintains that it “does not matter because the defendant was only reviewing and making recommendations, not the final decisions.”
“This is totally ridiculous,” the judge said. “It is a conflict of interest for the person in charge and making recommendations to the town board to be receiving money from persons or corporations they are reviewing.”
Griffin said that “Ippolito followed all of the rules and town codes in connection with his relationship with the Lizzas and the filing of his financial disclosure forms. We are confident that the answers to Judge Wexler’s questions will fall in Mr. Ippolito’s favor.”
In response to Wexler yesterday, a spokeswoman for Oyster Bay, Marta Kane, said in a statement: “The Town previously provided the Court with responses to two questions, and stands by those responses. Apparently, the Court is now making a further inquiry, and the Town will review the minutes of the Court proceeding and act accordingly.”
If Wexler follows through on his vow to increase Ippolito’s sentence, he would be within his rights as a federal judge. While they usually follow plea bargains, federal judges are not bound by them. The maximum sentence Wexler could give Ippolito is 5 years for pleading guilty to a single count of income tax evasion.
Prosecutors Mirabile and Tierney declined to comment.