Corruption trial bruises powerful law firm

ALBANY – Over the past 43 years, Whiteman Osterman & Hanna became one of New York’s largest and most prominent legal and lobbying firms.

In just eight days at the recent political corruption trial of Joe Percoco and three businessmen, it gained a less prestigious distinction: the firm that employed Todd R. Howe, a convicted felon and the bagman for payments to Percoco.

Howe, a onetime government insider, testified against Percoco, the former top aide to Gov. Andrew Cuomo, and his three co-defendants. He also inflicted collateral damage to the Albany-based firm, where Howe managed to stay employed for six years even after being convicted of bank fraud. From its subsidiary offices, where his job title was lobbyist, he engaged in widespread chicanery right under the noses of some of the most seasoned legal experts in upstate New York.

Percoco was convicted March 13 of three of the six counts against him, including honest services fraud and soliciting bribes.

Just as Percoco’s crimes have damaged the reputation of his former employer, Howe’s misdeeds have bruised Whiteman Osterman & Hanna. In the wake of the trial, people are “certainly going to connect corruption with that law firm,” said Vincent Bonventre, a law professor at Albany Law School.

“For lawyers, we’re puzzled as to how this could happen in that firm, that they could have had somebody like Todd Howe in that firm for such a while,” Bonventre said.  “I would imagine any lawyer — even probably lawyers in the firm — are bewildered at how this could have happened.”

Bonventre offered abundant praise for the ethics, professionalism and legal acumen of others at the firm, which he noted includes senior counsel Howard Levine, a former associate judge of the state Court of Appeals, the state’s highest court. Another senior counsel, Bernard “Bud” Malone, served as an associate justice on the Appellate Division’s Third Department.

The firm, with its main offices just across from the state Capitol at 1 Commerce Place, has included other prestigious legal minds: John R. Dunne, a longtime Republican state senator, was assistant attorney general for civil rights in the administration of President George H.W. Bush; a co-founder of the firm, Michael Whiteman, was counsel to Govs. Nelson Rockefeller and Malcolm Wilson.

“They’ve got to be mortified that the name ‘Todd Howe’ is associated with Whiteman, Osterman & Hanna,” Bonventre said.  “I know so many fine lawyers in that firm — I mean really good, decent people.  It’s hard for me to imagine that they would have allowed this to happen.”

The firm’s leaders declined to be interviewed for this story. William Dreyer, a longtime Albany attorney who is representing the firm, said in a statement that Whiteman Osterman & Hanna “was a victim of Todd Howe’s fraud.”

Dreyer noted that after firing Howe after federal agents raided his Maryland home in April 2016, the firm “cooperated with the government by providing witnesses for interviews and thousands of documents to assist the government in putting its case together against Mr. Howe. Under those circumstances, a victim should not be asked to explain later why it was conned and defrauded by a con man.”

Immediately after his termination, a defiant Howe denied wrongdoing and threatened to sue Whiteman Osterman & Hanna for defamation. But less than five months later, he pleaded guilty to multiple felonies — including several related to embezzling from his employers — and began cooperating with prosecutors.

When Howe first took the stand in early February, his history at the firm was catnip for defense attorneys who sought to undermine his credibility.

“From 2002 to 2010, you were convicted of a felony, you’ve been sued by family, friends and colleagues, you’ve gone through a bankruptcy, you were stealing from Whiteman Osterman from at least 2009,” Stephen Coffey, an Albany lawyer representing Syracuse developer Steve Aiello, asked Howe on Feb. 14. “You had financial problems, past frauds and crimes — and that was just in eight years, correct?”

“Yes,” Howe replied.

“Yet even with that, in 2010 you were considered a valuable member of the community by Whiteman Osterman, weren’t you?”

“Yes,” Howe responded.

The Troy native arrived at Whiteman Osterman & Hanna in 2002 with a resume of work for Gov. Mario Cuomo and his son, Andrew. Howe had served alongside the younger Cuomo, who led the Department of Housing and Urban Development under President Bill Clinton.

More recently, Howe had been fired from his previous job, at the Mortgage Bankers Association.

Howe testified the association fired him and Howard Glaser, another Cuomo family retainer who had worked at HUD, because “they didn’t want two Cuomo Democrats in this organization when (President George W.) Bush had just pulled into town.”

But Howe acknowledged that another reason for his firing was because of a “travel expense issue, that I had stayed at a hotel that wasn’t approved by the current president at that point, and I didn’t listen to him and went ahead and did it anyway.”

Howe testified that when he approached Whiteman Osterman & Hanna,  he “certainly indicated that I left on bad standing at the Mortgage Bankers.”

It was no roadblock: Howe was hired and became president of a D.C.-based subsidiary of the firm, WOH Government Solutions.

In 2010, Howe was charged with stealing $45,000 from a bank. He said Whiteman Osterman & Hanna not only kept him on the job, but the firm also offered to go to bat for him with a letter of recommendation.

“I had my lawyer talk to the managing partners,” Howe testified.

“So after Whiteman Osterman wrote the letter of recommendation, did you stop stealing from them then?” Coffey asked.

“I did not, no,” Howe said.

Indeed, Howe remained employed at the firm after he was convicted, allowing him to continue to steal hundreds of thousands from his employers through sham bank accounts.

Coffey, the defense attorney, grilled Howe about his 2010 conviction for scamming the bank, and how it didn’t end his career at Whiteman Osterman & Hanna.

“Well, you didn’t tell them that you had defrauded a bank out of $45,000, did you?” he asked Howe.

“Yes, I did,” Howe said.

“They kept you on the job, right?” Coffey asked Howe moments later.

“Yes,” Howe said. “In fact, counselor, they even said they had represented TD Bank in the past and (asked) would it have helped if they’d called to TD Bank to say, ‘Try to get rid of this problem.'”

But Howe said the case at that point had already been resolved.

“That was unfortunate, then,” Coffey said. “Perhaps if they had called before, then you could have gotten out of that $45,000 fraud, right?”

A federal prosecutor objected, and Judge Valerie Caproni sustained it.

Dreyer, WOH’s attorney, said in his statement that at the time of Howe’s bank fraud case “the firm … dealt with Mr. Howe’s attorney and understood the conviction to be about a bounced check for college tuition and not an underlying bank fraud, so the information that Mr. Howe provided at trial is not in accord with what the firm understood.”

“Members of the firm were on the government and defense witness list, but were never called,” Dreyer added. “All of the witnesses who were on the witness list were ready, willing and able to appear if called.”

Howe had made it clear in his testimony that he did not believe Whiteman, Osterman & Hanna wanted any part of Percoco, who according to Howe wanted to be hired at the firm after he left the Cuomo administration in April 2014 to run the governor’s first re-election campaign.

“I knew it wasn’t going to be a possibility because I knew that the law firm would not hire Joe on a temporary basis like that because the law firm had a lot of state business before the state, and they knew Joe’s reputation and Joe’s position in the campaign, and they probably would think that he might go back to the governor’s office,” Howe said. “My feeling was they wanted to probably stay as far away from this idea as possible.”

Howe said Richard Leckerling, his boss at Whiteman, Osterman & Hanna and a person he said he had known for 30 years, “was going to look at me like I had three heads if I raised this idea with him, so I didn’t raise it with him.”

Among other misdeeds, Howe falsely claimed to be an attorney, used an old signature from his boss to falsify paperwork, and served as a bagman for illicit payments to Percoco.

Despite the inventory of his crimes described at the trial, Howe presented himself on the witness stand as a clean-cut professional who may have made mistakes but was trying to make amends.

That effort was dealt a serious blow when Howe was taken into federal custody mid-trial after he admitted during cross-examination to trying to scam his credit card company out of the cost of a night’s stay at the Waldolf-Astoria — even after he had signed a cooperation agreement with the federal government that required him to stop committing crimes.

Howe’s testimony helped convict Aiello, the top executive of Syracuse-based COR Development, of conspiring to commit honest services fraud. Jurors cleared COR’s general counsel, Joseph Gerardi, of all charges. They could not reach a verdict on the charges facing Peter Galbraith Kelly, a former executive with Competitive Power Ventures, an energy company that also had business before the state.

Whiteman Osterman & Hanna now faces the impact of a second high-profile political corruption trial in Manhattan federal court in June that could also feature Howe as a witness. In that proceeding, Aiello and Gerardi will join former SUNY Polytechnic Institute President Alain Kaloyeros and Buffalo development executives Louis Ciminelli, Michael Laipple and Kevin Schuler in the second and final trial to emerge from the federal probe into upstate development projects.

Competitive Power Ventures, LPCiminelli, SUNY Poly and COR Development all were clients of Whiteman Osterman & Hanna or its Howe-led subsidiary, WOH Government Solutions.

The second trial “is going to drag the firm in the mud again,” said Albany Law School’s Bonventre.

Still, Bonventre believes Whiteman Osterman & Hanna “will come out fine” due to the fundamental quality of its team — with the one notable exception.

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