June 18, 2018 / 8:23 PM / 9 months ago

Bid-rigging trial begins for ex-State University of New York official

NEW YORK (Reuters) - The former president of the State University of New York’s Polytechnic Institute went to trial on Monday on charges that he helped rig a 2013 bidding process for a billion-dollar development project intended to revitalize the Buffalo, New York, region.

FILE PHOTO: Alain Kaloyeros (L), president of the State University of New York's Polytechnic Institute, walks out of the Manhattan federal courthouse in New York, U.S., September 22, 2016. REUTERS/Bria Webb/File Photo - TM3ECAB17B201

Alain Kaloyeros has pleaded not guilty to charges of wire fraud and conspiracy. Prosecutors have said he helped fix bids for “Buffalo Billion,” an economic development project to invest $1 billion in Buffalo, the state’s second largest city.

“This is a case about lying and cheating to get huge state construction projects worth hundreds of millions of dollars, all paid for by the taxpayers of New York,” Assistant U.S. Attorney David Zhou told jurors in his opening statement in Manhattan federal court.

Zhou told the jury that Kaloyeros worked with Todd Howe, a lobbyist and former aide to New York Governor Andrew Cuomo, to award lucrative contracts to Buffalo-based developer LPCiminelli and Syracuse, New York-based COR Development Co. He said the two companies were hand-picked in advance, and public requests for bids were tailored to them.

Former LPCiminelli executive Louis Ciminelli is also charged in the case, as are former COR executives Steven Aiello and Joseph Gerardi.

Kaloyeros is not accused of taking bribes. Instead, Zhou said, he was motivated by a desire to curry favor with Howe, who had ties to Cuomo.

Kaloyeros’s lawyer, Reid Weingarten, told jurors that his client was a “lone ranger” who did what was necessary to bring development to upstate New York, but that he never broke the law.

“He cut through red tape like on one else,” Weingarten said.

Lawyers for Ciminelli, Aiello and Gerardi also told jurors that their clients never schemed to rig bids.

Aiello and Gerardi were previously defendants in a separate trial in which they were accused of bribing Joseph Percoco, a former top Cuomo aide, to win favorable treatment for COR.

Percoco was found guilty on multiple corruption charges. Aiello was convicted of one count of conspiracy, while Gerardi was acquitted.

Howe, who pleaded guilty and agreed to cooperate with prosecutors, testified at that trial but was arrested after he admitted under cross-examination that he violated his cooperation agreement.

Howe is not expected to testify in Kaloyeros’s trial. Instead, prosecutors are expected to call former LPCiminelli executive Kevin Schuler, who pleaded guilty last month and agreed to cooperate.

Reporting by Brendan Pierson in New York; Editing by Tom Brown

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