Friday, July 1, 2011

CM James Commends Mayor Bloomberg On Demanding $600M Refund for Citytime Disaster

June 29, 2011

Contact: Aja Worthy-Davis at (212) 788-7081

Council Member Letitia James Commends Mayor Bloomberg On Demanding $600M Refund for Citytime Disasterr

New York, NY— The charges against Citytime were outrageous— on December 15, 2010 four Citytime consultants were charged with embezzling $80 million from the City of New York through steering public funds to consulting firms who funneled the money to shell companies controlled by the consultants and their families. By the time federal investigators and the NYC Department of Investigation began looking into the program’s payroll fraud and abuse, the list of crimes became more unbelievable. By February 2011, three upper-level Citytime officials employed by project contractor, Science Applications International Corporation (SAIC) were dismissed from their positions.

And it soon became clear why such steps were taken— two officials soon plead guilty to criminal charges, and SAIC found one senior projects manager erroneously billed overtime hours. In fact, TechnoDyne, one of the largest subcontractors of Citytime, saw its executives flee the country after receiving federal indictments for their crimes. All this brought the number of people allegedly involved in Citytime corruption since last December to a whopping eleven, with federal prosecutors seizing more than $38 million in stolen funds from over 100 bank accounts hidden in international shell companies.

It is no wonder Mayor Bloomberg— on the eve of the expiration of the SAIC contract— saw fit to demand a $600 million refund from SAIC on behalf of the City of New York!

“Mayor Bloomberg absolutely made the right decision in demanding a refund for this thief’s buffet,” said Council Member Letitia James. “I regret that he did not move to address this Citytime corruption when it first became apparent, perhaps it could’ve saved CUNY’s Vallone scholarship or DHS’ Advantage Program program, programs that offered options for low-income New Yorkers. Perhaps this money could’ve helped ease cuts to domestic violence services, criminal justice services, and city hospitals and health services. Allegations of greed and mismanagement were widespread for some time before the investigations proved them to be more than accurate.”

On September 2010, before any crimes were uncovered, Comptroller Liu announced his agreement with the administration to give SAIC a deadline of June 30, 2011 to complete all original work on the program. With the understanding that the delayed work would be completed, the program was allocated up to $32M for maintenance and support services alone. Around this time, Council Member Letitia James joined Local 375 (DC 37) in opposing the project. Council Member James cited what were at the time ‘accusations’ of administrative greed and mismanagement, as well as the ballooning costs of the program from an initial $68 million to what at the time was $700 million.

Council Member James has been a long-term opponent of the Citytime project, from her tenure of Chair of the Contracts Committee where she held two hearings on the project in 2008 and 2009, respectively.


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