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Federal court upholds Percoco conviction on corruption charges

Joseph Percoco leaves the federal courthouse on Centre

Joseph Percoco leaves the federal courthouse on Centre Street after being sentenced, Sep. 20, 2018. Credit: Jeff Bachner

ALBANY — A federal court on Wednesday upheld the conviction of Joseph Percoco, the former closest aide of ex-Gov. Andrew M. Cuomo, on corruption charges.

The U.S. Court of Appeals for the 2nd Circuit also upheld the convictions of four others in the so-called Buffalo Billion scandal, including Alain Kaloyeros, the former state university official who oversaw Cuomo’s signature upstate development project.

Percoco was convicted in 2018 and sentenced to six years in prison for taking more than $300,000 in bribes from a developer and an energy company to exercise his clout in state government. The 52-year-old is held in a federal prison in Otisville, Orange County.

Kaloyeros, who founded the State University of New York Polytechnic Institute, was convicted of bid-rigging for steering lucrative contracts to Syracuse and Buffalo developers. In 2018, he was sentenced to 42 months in prison, but has been free pending his appeal.

Three developers involved with Percoco and Kaloyeros also saw their appeals rejected by the court.

The 2018 convictions tainted Cuomo’s high-profile projects to boost the upstate economy.

And though the then-governor wasn’t implicated, the trials were a "black eye to the executive branch and to Cuomo personally," given his closeness with Percoco, political analyst Michael Dawidziak said at the time.

Percoco was a longtime aide not only to Andrew Cuomo, but also to Mario Cuomo, once described as the late governor’s "third son." He was Andrew Cuomo’s executive deputy secretary and political enforcer.

He had left the state payroll to work as Cuomo’s campaign manager. But the trial showed he also solicited bribes and used his clout to cut red tape for a Hudson Valley power plant.

Percoco also facilitated projects for a Syracuse developer and Cuomo donor and pushed for a raise for one of the developer’s sons, who worked for Cuomo.

In seeking to overturn the verdict, Percoco argued he couldn’t be convicted of "honest services fraud" in part because he wasn’t on the state payroll at the time of the alleged actions.

The court rejected that claim, in a unanimous decision.

"In so concluding, we reaffirm our decades-old decision holding that a person who is not technically employed by the government may nevertheless owe a fiduciary duty to the public if he dominates and controls governmental business, and is actually relied on by people in the government because of some special relationship," the court wrote.

Kaloyeros, the nanotechnology professor who spearheaded the state university’s computer-chip development efforts, was convicted of giving connected developers the inside track on lucrative contracts. Buffalo developer Louis Ciminelli and Syracuse business owners Steven Aiello and Joseph Gerardi also were convicted, with sentences ranging from 28 to 36 months, but they remain free on appeal.

On appeal, the court dismissed claims from the defendants who argued that the trial judge made errors in jury instructions and the admission of evidence, and that there was insufficient evidence to convict them of the wire fraud allegation at the heart of the charges. They also claimed no one actually was harmed, which the court said isn’t the legal standard.

"To prove a scheme to defraud, it need not be shown that the intended victim of the fraud was actually harmed; it is enough to show defendants contemplated doing actual harm," the court wrote.

Lawyers for Percoco and Kaloyeros didn't comment immediately.

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