Feds conduct wide-ranging criminal investigation of port authority
A federal grand jury has subpoenaed six years of Connecticut Port Authority records pertaining to a wide-ranging investigation of the quasi-public agency’s business, from its comprehensive management contract for New London’s State Pier to a communications/marketing deal that went to a former associate of Deputy Secretary of the State Scott Bates, when he was chairman of the authority.
The subpoena by a grand jury sitting in New Haven was dated March 16 with a required return date for the requested materials of April 6.
Tom Carson, a spokesman for the U.S. district attorney for Connecticut, said this week the grand jury business is secret and he could not comment on the status of any federal criminal investigation into the port authority.
The grand jury’s subpoena asks for communications, financial information, compensation and payroll information and a host of other records pertaining to the port authority’s relationship with a number of entities, including Gateway Terminals, the operator of the New Haven port terminal that was given long-term management control of the competing port of New London.
The subpoena also asks for materials related to Gateway’s partner at the time of the transaction, Enstructure LLC, and its lobbyists, the prominent state firm of Gaffney, Bennett and Associates. The records request specifically mentions the lobbying firm’s managing partner and co-founder, Jay Malcynsky.
Records sought in the subpoena for other entities include Dealy Mahler Strategies, a firm headed by a former associate of Bates, who landed the bigger part of a communications and marketing contract for the agency after the deputy secretary of the state involved himself closely in the selection process.
Bates recommended the firm run by his former associate be hired even before he had reviewed the official bid proposals, I learned and reported on after reviewing emails obtained through a Freedom of Information request.
Others specifically named in the subpoena, with a request for their emails, include Bates, David Kooris, the current chairman of the board, Evan Matthews and the former executive director, Henry Juan, a former board member whose employer, Seabury Maritime _ also cited specifically in the subpoena _ received a controversial “success fee” of more than $500,000 for arranging the bid process that awarded State Pier management to Gateway.
Emails were also requested for Andrew Lavigne, a former associate of Bates, who was hired for a prominent, high-paying port authority job despite no relevant experience. He was ethics compliance officer for the authority until the board revoked that designation this week, following recent disclosures that he took gifts from Seabury Maritime that resulted in the company being fined by the Connecticut Office of State Ethics.
Lavigne is still employed by the agency. John Johnson, a board member whose term has expired, has also continued to serve, in the absence of a replacement appointment by Gov. Ned Lamont, despite a ruling by the ethics office that he should not routinely vote on matters related to State Pier, which he does.
I obtained the Department of Justice subpoena in response to a Freedom of Information request for all subpoenas issued to the agency.
I received one other, from the office of Attorney General William Tong, which also asked for records pertaining to the marketing contract to Dealy Mahler, as part of an anti-trust matter.
Authority Executive Director Ulysses Hammond reported in a subsequent email that authority lawyers have reported the anti-trust probe by the attorney general relating to the Dealy Mahler contract has been closed.
A spokesman for Tong’s office confirmed it is not pursuing that matter at this time although other probes pertaining to the authority remain open.
“Our investigation involving communications and marketing services has been closed. Other investigations relating to the Port Authority remain open and active and we cannot comment further,” the Tong spokesperson said.
It appears the port authority is not disclosing other subpoenas it has received.
Hammond said in an email that “to the extent other subpoenas were issued to the CPA” they would be exempt from FOI disclosure because they pertain to a whistleblower investigation.
Indeed, Tong’s office has confirmed an investigation involving subpoenas into the half-million-dollar success fee paid to Seabury, former board member’s Henry Juan’s employer, and it was apparently started by a whistleblower.
I asked Hammond to explain why, for the purposes of FOI law, materials held by the port authority could be labeled part of another agency’s investigation. After all, how would the port authority even know a subpoena was part of a whistleblower probe.
I hadn’t heard back from Hammond on that question before deadline.
But it looks like it might become one more instance in which the governor’s scandal-plagued port authority has resisted transparency and chose to wage long, expensive and dogged battles before the Freedom of Information Commission.
The port authority is not only resisting an FOI request for subpoenas but also its response to whatever subpoenas it may be hiding.
I think the public would like to know all it can about how the employer of a former board member came to get a half-million success bonus, in addition to its generous fees.
It was the rich bonus to Seabury that the Connecticut State Contracting Standards Board has already said was probably illegal, the same as finder’s fees, which the General Assembly outlawed, after a nasty political criminal scandal.
Authority Chairman Kooris suggested some time ago to the governor’s office in an email, which I obtained through a FOI request, that the agency resist providing information to state auditors when they were investigating the payment of the rich success fee to Seabury.
It’ good to now know that not only is the attorney general on it, but so are federal investigators, in their very wide-ranging probe of what may be destined to be remembered some day as one of Connecticut’s most corrupt agencies ever.
And there’s a lot more to learn about what has gone on.
This is the opinion of David Collins