John Liu got a public chewing out for publicizing progress on the CityTime fraud case, but the crackdown is winning Liu real stature as an honest pol daring to take on Bloomberg’s lax oversight over a corrupt city establishment.
Already seven people have been arrested and $28 million in stolen cash recovered as U.S. Attorney Preet Bharara delves into the so-called CityTime project that was initially supposed to cost New York City $28 million to automate its payroll system but has already cost $800 mil. Much of that is due to fraud, outright theft, complete lack of oversight of the companies providing tech consulting as well as some changes in specs.
As a city comptroller who has declared his intention to run for mayor, Liu has been aggressive in calling Mayor Mike Bloomberg out for letting the CityTime project turn into a massive white elephant by failing to exercise meaningful oversight. The Comptroller is New York City’s second most powerful elected post, and has served as a springboard for several recent mayoral candidates.
But Liu’s series of out-front public disclosures about the scandal has irked Bharara. In particular, Bharara seemed to be referring to Liu’s May 25 announcement that CityTime’s top consultant Gerard Denault was fired for timecard abuse when he wrote Liu to say he hoped Liu would allow prosecutors and the Department of Investigation to continue their work, “free from concern that even well-intentioned actions or announcements by third parties without access to all the facts might compromise their ongoing investigation.”
Two days after Liu’s statement the feds announced that Denault had been indicted for taking $5 million in kickbacks from a subcontractor, creating the irksome appearance that Liu was acting as pointman for the Fed’s probe.
“We are committed to working cooperatively with all law enforcement agencies,” Liu replied Wednesday in a statement that denied he has interfered with the investigation. At this point, virtually any statement out of Liu’s mouth only serves to reinforce his stature as the official who brought down what is increasingly looking like Bloomberg’s rotten house of cards.
