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Prosecutor: 4 conspired in bid-rigging development effort

Former SUNY official Alain Kaloyeros arrives at a

Former SUNY official Alain Kaloyeros arrives at a federal courthouse in Manhattan for his trial on July 2. Credit: Charles Eckert

A once-powerful SUNY official and three developers conspired with a disgraced lobbyist to rig bids on upstate development projects and tried to hide their crime by deleting emails, prosecutors argued Monday at the Manhattan federal court corruption trial over Gov. Andrew M. Cuomo’s “Buffalo Billion” initiative.

“These men did not want to play by the rules,” prosecutor Matthew Podolsky told jurors as summations began in a case that has put a harsh spotlight on the governor’s signature upstate revitalization program. “They did not want to give anyone else a fair shot at the millions of dollars in projects, so they wired it.”

Former SUNY Polytechnic Institute head Alain Kaloyeros, Cuomo’s choice to head the development effort, is accused of steering nearly $1 billion in projects to Louis P. Ciminelli, a Buffalo builder, and Steven Aiello and Joseph Gerardi of COR Development in Syracuse.

Prosecutors allege that Todd Howe, a former lobbyist and one-time Cuomo aide who pleaded guilty and agreed to cooperate with the government, was at the center of the scheme, making six-figure consulting fees from Kaloyeros,as well as from the Syracuse and Buffalo developers.

Howe — who has admitted to bank fraud, embezzlement from his law firm and bribery — wasn’t called as a witness because of credibility issues, but Podolsky warned of defense efforts to blame him for the entire scandal, citing emails showing Kaloyeros and the developers worked to tailor bid specifications while using Howe as an intermediary.

“Todd Howe was up to no good, but he was up to no good with the men sitting right here behind me,” the prosecutor said. “Todd Howe was a criminal and a fraudster, but don’t be distracted. He was a criminal and a fraudster that these defendants picked, used and benefited from.”

Podolsky also leaned heavily on evidence of a cover-up, repeatedly directing jurors to the defendants’ use of private email or secure apps, and nearly two dozen suspicious emails deleted by Kaloyeros and Ciminelli after the government probe surfaced in 2015.

Among the correspondence they tried to get rid of, he said: a note from Howe passing along “vitals” from Ciminelli’s company for use in bid specs, and another from Kaloyeros asking for “unique” features to require in a request for proposals.

“These emails are complete proof that they rigged the process,” the prosecutor argued. “And they never wanted you to see them.”

The government claims Kaloyeros, 62, of upstate Slingerlands, steered projects, including a solar-panel fabrication plant and a “film hub,” to Howe clients Ciminelli and COR, both major Cuomo donors, because Howe was a bridge to Cuomo, whose favor Kaloyeros craved to enhance his power and prestige at SUNY.

But Kaloyeros lawyer Michael Miller told the jurors his client got no tangible payoff, and said it made no sense for his client to risk for nothing in return a 20-year career at SUNY in which he is credited with turning its Albany campus into a high-tech hotbed.

“There were no fancy suits,” Miller said. “There was no sweetheart deal. There was nothing.”

Instead of a corrupt scheme, Miller said, Kaloyeros was on trial because Cuomo chose him in 2013 to kick-start a moribund upstate economic development program outside the “red tape” of formal procurement standards, and he acted in “good faith” in discussing plans with developers before formal bidding.

“That system isn’t on trial here,” he told jurors. “That’s why we vote every four years.”

Miller said that even though he wasn’t called as a witness, Howe had colored the case through his emails and conversations with other government witnesses, giving it a corrupt cast that wasn’t merited.

“He told people what they wanted to hear,” Miller said. “He was everything to everyone. . . . Alain Kaloyeros was betrayed by Todd Howe. Todd Howe was playing everyone for Todd Howe.”

The four defendants are charged with conspiracy and wire fraud for misleading the board of SUNY’s development arm, the Fort Schuyler Management Corp.

Closing arguments from lawyers for Ciminelli, Aiello and Gerardi are scheduled Tuesday.

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