All that clucking you're hearing? That's nothing but the CityTime chickens coming home to roost-just as the NY Daily News' Juan Gonzales warned. Now, however, we go from malfeasance on the part of the Bloombergistas, to outright fraud-as City Room has reported: "Four contractors were arrested and charged Wednesday with misappropriating more than $80 million for work on the development of an automated timekeeping system for New York City employees. Federal prosecutors said that Mark Mazer, who was hired to do quality assurance on the creation of the system, CityTime, awarded contracts to people he had ties to and took nearly $25 million in kickbacks. Mr. Mazer, his colleague Scott Berger and the men whose companies he steered business toward, Dmitry Aronshtein and Victor Natanzon, also submitted false time sheets for consulting work, the authorities said."
The US Attorney captures the same irony that Gonzales had exposed in a series of Pulitzer Prize deserving articles: "In an ironic twist, funding for CityTime, a project intended to prevent payroll waste, fraud and abuse, was itself allegedly bilked in part by fraudulent timekeeping,” Preet Bharara, the United States attorney in Manhattan, said in a statement. Along with Mr. Mazer, Mr. Aronshtein and Mr. Natanzon, Mr. Mazer’s wife and mother were charged with money laundering for, prosecutors said, funneling the kickbacks through a series of shell companies."
All of this devolves from the lax oversight that Gonzales had brought to light-a point that the WSJ reiterates: "The CityTime project, which began in the 1990s, has been plagued by cost overruns. Mayor Michael Bloomberg has called it a "disaster." The project's costs skyrocketed to more than $738 million from $68 million, and in September the city reached an agreement in which it wouldn't make any more payments related to the project."
This dramatically underscores just how overrated Mike Bloomberg's management acumen really is-and raises a question that we raised in March: Will Morticia give Bloomberg the Knucklehead Award he deserves. As we wrote: "So, while local businesses suffer and services are cut down with the concomitant layoff of city workers, we enter the mayor's unearned third term with the paradox of a chief executive touted for his competence, exhibiting something far less-and that these "consultants" are still on the payroll is an outrage that is deserving of a Platinum Knucklehead Award from a Mort Zuckerman who will simply never give Bloomberg the honors that he has earned."
The NY Times highlights this gross example of management negligence: "The indictment raises questions of the city’s oversight of the CityTime project, and how the Office of Payroll Administration, a hybrid agency of the mayor’s and comptroller’s offices, lost control of the project under the office’s executive director, Joel Bondy."
The mayor's response? Lame: "The issue is that here we had somebody that we trusted, or one of our contractors trusted, and that trust was misplaced,” Mr. Bloomberg told reporters on Wednesday. “And we just have no tolerance for this whatsoever.”
City Room gets the quote of the day from DOI Commissioner Rose Gil Hearn: "The supposed experts hired and paid well to protect the city’s interests were exposed as the fox guarding the hen house, secretly pocketing millions and purchasing expensive homes and cars,” Rose Gill Hearn, the department’s commissioner, said in a statement."
But the Fox-in-Chief is Gill Hearn's boss, the mayor of the City of New York. Gonzales warned him and all of us in his series of exposes-and he well deserves the last word. As he said so presciently last March: "It's time to speak plainly. CityTime is a new-age version of feeding at the government trough. It's a luxury employment project for computer geeks with friends and connections in high places. The mayor should fire everyone in charge of it. He should pull the plug on this boondoggle now."