Friday, May 11, 2012

The Collapse of the Pension Revision Process

NYCERS appears to have stopped doing revisions of pension benefits. The need for a revision can be caused by several events. The most common is the payment of back pay paid by the former employer after a retiree's benefit has been finalized by NYCERS.

Right now there are retro payments that were paid over 20 months ago that have not been processed. What is worse is that NYCERS is refusing to communicate to the effected retirees the reason for the delays or tell them when the new benefit will finally be paid along with the significant retro payment.

NYCERS has an independent administrative budget controlled by the trustees. NYCERS has no legitimate reason not to provide timely service to members and retirees.

Thursday, May 10, 2012

Sex, Lies, and Martha Stark

2011 DOI report on Stark

Last week DOI released a June, 2011 investigative report on allegations about Martha Stark that were pending at the time she was forced to resign in April, 2009. Stark, in clear sign of problems, refused to be questioned by DOI. So much for DOI's subpoena power. Stark is still teaching at Baruch College earning over $100K and still earning pension credit at NYCERS. How's that for connections. She also seems to have landed a second job, teaching at Columbia. You can't make this stuff up.

The prime source of evidence for this report were emails, going back to at least November 2003, from Stark and other Finance employees. Finance employees, at least six, had no fear of lying under oath to DOI. Without the emails DOI would have been stymied. I guess DOI learned their lesson from their inept 2004 investigation at NYCERS. Of course, they might be using honest intelligent investigators now. Why are any of these Finance employees are still working for the city.

DOI appears to have only addressed the specific allegations pending as of April, 2009. I can only wonder what else DOI stumbled on in reviewing the history of Stark's emails.

Stark should have borrowed Kin Mak from NYCERS to clean up her email trail. Of course, she knew he'd make a copy of everything and then a lot people would be looking over their shoulders.

It is now clear why NYCERS has tolerated the continued employment of high level staff members who have lied under oath. It is a common practice at the city.

This report is 111 pages long and clearly represents an enormous amount of work by DOI. The report is a fantastic read. You will not be able to put it down. It is impossible to quickly characterize it. You just have to read it.

DOI has forwarded this report to the Manhattan DA'a office. What are they doing with this report since June, 2011? Perjury, bribery, and tax evasion are within the DA's jurisdiction, not COIB's.


Bribery at Finance

In February, 2002 the mayor appointed Stark as Finance Commissioner. This is an unclassified title which means there are no qualifications for the job. Stark is an openly gay female African-American. The problem was that she was not really qualified to run Finance. Of course, that's never stopped mayors before. But somewhere along the line the romance went cold.

On February 26, 2002 the NY Times reported the indictment of 18 NYC Finance tax assessors, one of which was a woman named Roberta Hand. DOI determined that at some point Stark and Hand were involved. This bribery scheme had been in existence for almost 25 years.

In response to the scandal, Stark agrees to implement key remedial measures recommended in an August, 2002 DOI/DOF preliminary report. DOI reports that these measures were never fully implemented "leaving glaring corruption vulnerabilities unaddressed". In addition, Stark lied in the 2004 final report about actually implementing these measures.

In the end, this is where Stark probably did the most damage. The tax mess from 2002 was never cleaned up and appears to have only gotten worse under her reign. Her escapades, however insane, with multitude female Finance employees are just a messy side show. In addition, the mayor has provided no evidence that he has corrected the chaos at Finance.

In September, 2002 the mayor appointed Stark to the NYCERS and TRS pension boards. Stark was the chair of the NYCERS board.

For many years Rochelle Patricof's husband, Allan, had worked as an administrative law judge at Finance. In 2002, when Stark made Rochelle the first deputy commissioner, she asked COIB for letter giving her clearance for the appointment and the obvious conflict with her husband working at Finance. There was also a 1997 COIB letter dealing with this issue when Patricof became general counsel at Finance.

In November, 2002 COIB issued a letter to Patricof approving her appointment as first deputy commissioner contingent on her recusing herself from any matters that involved her husband.


In January, 2003 as part of the reform process Stark appoints an outside real estate tax expert, Linda Yancey, as the new Assistant Commissioner of Real Property at Finance. By April 22, 2003, as reported by the N.Y. Daily News, Yancey had resigned in despair and had notified the City Council of her serious concerns about the property tax system and its lack of equity. In retrospect, Stark's comment in the article was completely false. City Hall had fair warning of serious problems at Finance.

On September 8, 2003 DOI determines that Rochelle Patricof, first deputy commissioner at Finance, violated COIB law by invoving herself in matters that potentially affected her husband's compensation as a Finance ALJ.

In October, 2003 DOI concluded that Allan Patricof presented an intimidating presence that people were reluctant to respond to because of his wife's position at DOF.

In the fall of 2003 Stark begins a long running affair with Dara Ottley-Brown, a married female Finance employee who was working in the Bronx at the time. From November 16, 2003 to June 5, 2005, Ottley-Brown's salary went from $84,460 to $131,175.

In order to get a feel for this relationship consider this email exchange between Ottley-Brown and Stark concerning Ottley-Brown's impending promotion. In a November 25, 2003 Finance email titled" The Biggie" Ottley-Brown writes to stark "Okay, here is the big question: If you are vetting me, have you tentatively set my future salary? If so what would it be? Is this open to negotiation? Would Negotiation be contentious? Dara B."

The response from Stark, 20 minutes later, is equally outrageous. I'm too tired to type the whole fawning email but let me give you the last sentence as the coup de gras: "I don't want to disappoint you in any way but I'll let you know if I can do what you want."

Everyone in the city should read this report. It goes to the heart of why the civil service system was invented. Elected officials and their appointees must be tightly constrained when it comes personnel issues.

Also in the fall of 2003 Carol DeFreitas, a female employee at Finance, allegedly asked Stark for a change in her work assignment. In December, 2003 Stark and Rochelle Patricof, the first deputy commissioner, assigned DeFreitas to work at DOI. DeFreitas continued to be paid by Finance for many years while working at DOI. At the very least, this is a violation of the city charter but also appears to be a pattern of Stark's behavior with female Finance employees.


In January, 2004 Stark appointed Ottley-Brown to the position vacated by Yancey the year before. It is hard to ignore the suspicion that Stark wanted back door control of the real property division.
It is comical to go back in time and read Stark's press release:
FOR IMMEDIATE RELEASE... January 16, 2004


Property Valuation Process Less Vulnerable to Corruption, More Efficient, Easier to Understand

Finance Commissioner Martha E. Stark and Department of Investigation Commissioner Rose Gill Hearn today released a report describing steps Finance has taken to reduce the risk of corruption in the property valuation process, and ways Finance will continue to improve the valuation process and make it easier for the public to understand.

Commissioner Stark also introduced Dara Ottley-Brown, newly-selected Assistant Commissioner for Property, who will serve in an acting capacity for three months. They described the data in the Fiscal Year 2005 tentative assessment roll and recent management changes that contributed to a more efficient, transparent valuation process. Ottley-Brown replaces John McBride, who served very ably as Acting Assistant Commissioner for Property. "With this report and this assessment roll, we have ended a chapter in the City’s history and have begun an exciting era of renewed faith in the way we value people’s property,” Commissioner Stark said. “In less than two years, we have vastly improved the way we do our jobs, and we have begun to turn a confusing, secretive process into something that New Yorkers can actually understand and believe in.”

Prior to her selection as Assistant Commissioner for Property, OttleyBrown served in various management positions at Finance, including Property. Before joining the division as Deputy Assistant Commissioner, Ottley-Brown worked most recently as Deputy City Register in the Bronx Office. "I'm excited to lead the effort to transform the process of valuing property in this great City, bringing our practices into the 21st century so New Yorkers can be proud of the work we do for them,” Ottley-Brown said. "I want to thank Dara for taking on this challenge, and also thank John McBride for doing such a good job in transition and for identifying Dara as the person best able to do this job,” Commissioner Stark said. “But most of all, I want to thank the assessors and other staff in Property who have worked tirelessly not just to produce an accurate roll but, more importantly, to change the culture into one that is honest, creative and forward-thinking.”

This is a clear indication of Stark's absolute arrogance. You have to wonder what McBride thought at the time.

If the relationship was genuine, the one thing Stark should not have done was promote Ottley-Brown three months after starting the relationship. In fact, Stark should have left her in the Bronx forever. If Ottley-Brown was competent, she would have gotten promoted on her own, of course, not at Finance.

Ironically, in June, 2004, Stark requests that DOI investigate my relationship with a woman who was and is still working at NYCERS. At the time I was executive director of NYCERS and Stark was chair of the NYCERS Board of Trustees. The woman is now my wife.


In March 2005, Stark starts working for Tarragon, a private real estate firm.

This is an absolute violation of the city charter. No commissioner can have outside employment. There is no exception.

It appears COIB was fooled into issuing an approval for work under Chapter 68 of the city charter. You will notice there is no reported approval from the Law Department who could possibly have issued a "colorable" approval but they did not.

Stop for a moment and realize that for seven years the mayor let Stark invest the city pension funds!!!

Even with the COIB approval, Stark was told not use her position to help Tarragon or to use any city equipment or personnel. Stark proceeds to do extensive work for Tarragon during office hours, use her official position and letterhead, and use city resources and personnel, including Rochelle Patricof, to do her Tarragon work. Over a three year period she made at least $120,000. Nice second job!


On March 2, 2005 based on an investigation by Vincent Green and Carol Defreitas, DOI sends Stark a letter falsely accusing me of promoting the woman I was involved with. This investigation bordered on the corrupt with the suppression of evidence and acts of perjury by NYCERS staff. I now suspect DeFreitas was involved with Stark at some point.

On the evening of March 10, 2005 Stark calls me at home and tells me that I have been fired from my position as executive director at NYCERS.

On May 31, 2005 COIB finds that there are no Chapter 68 violations involving me or my wife.

On June 1, 2005 Stark demotes my wife from the position which she had earned on her own merits and without any help from me. At this point both Rochelle Patricof, the first deputy commissioner, and her husband, Allan, an administrative law judge, were working for Finance.

Back to Finance

In March, 2005 Subordinate 2, a married female, starts to work at Finance as a college aide at $12.50/hr in the executive office.

In May 2005, Stark begins trying to find job (public/private) for Ottley-Brown's ex-husband. Rochelle Patricof is brought into the process. Stark's first attempt was with DOITT as per a May 13, 2005 email. Stark eventually hires Mr. Brown at Finance for $78,000 in 2007. I think there was some child support issues involved with this hire.

On June 21, 2005 Stark tries to get Ottley-Brown's ex-husband, Jodie Brown at job at Bloomberg LP.

As of June 30, 2005 Fenella Ramsami was working at NYCERS at a salary of $26,351. Ms. Ramsami is the sister of Felita Baksh/Ramsami the NYCERS HR director. By June 30, 2006 Fenalla was working at Finance at salary of $28,316. Within a year she was earning $42,510. She now is earning $65,000.

In September, 2005 in response to an anonymous email from an alleged Finance employee I notified the Law Department that Stark was involved with two female Finance employees, Dara Ottley-Brown and Roberta Hand. In addition there was an allegation that in the spring of 2005 there was improper interference by Stark and Ottley-Brown with the property valuation of the Met-Life Building in conjunction with its May, 2005 sale to NYCERS and TRS. The email listed five specific assessors caught in the interference. The property sold for $1.74B, a record amount at the time. Stark was the mayor's representative on both boards.

In light of the truth concerning the two women, the Manhattan DA's office should review its non-response to the notice I gave to that office in May, 2006.

As far back as 2005 Stark and Ottley-Brown attended public functions and in at least one case were photographed for the Prospect Park Alliance's annual report. As of late 2005, it would have been very difficult for City Hall not to have known about Stark and Ottley-Brown.

After March 2005, Finance employees would approach me in public and tell me about Stark and Ottley-Brown and that they were afraid to report them to DOI. Previous reports had gotten back to Stark. At the time Vincent Green was the I.G. for Finance and Stark was supplying resources to DOI.

In October, 2005 Stark along with the other NYCERS Trustees appointed Diane D'Alessandro as the new executive director. D'Alessandro is an openly gay woman. The executive director position is classified as a non-competitive position under NY Civil Service Law which means that it has specific minimum education and work experience requirements. D'Alessandro had none of the required work experience or a "satisfactory equivalent".

By October 30, 2005 Subordinate 2 is working as a Special Assistant to Stark at a annual salary of $$49,512 up from $12.50/hr in March.


On April 10, 2006 Ottley-Brown signs the infamous Yankee Stadium property valuation letter. Long story short, Ottley-Brown, as part of the documentation for the stadium bond deal, wrote to Goldman Sachs that the land on which the new stadium was to be built was worth $204M. At the same time in a May 9, 2006 letter, the NYC Parks Dept. reported to the federal government that the land was worth $21M. You can guess who who has a tighter grip on reality. If you want the gory details, you can view the Congressional hearing on this issue and read a review of the hearing.

In May, 2006, I notified Dan Castleman at the Manhattan DA's office about Stark, Ottley-Brown and the Met-Life Building deal.

By August 13, 2006 Subordinate 2 is making $63,240/yr up from $49,512 in October.

On Sept 19, 2006 the City Council approves the mayor's appointment of Ottley-Brown as a commissioner to Board of Standards and Appeals, one of the two non-professional positions on a five person board. DOI determined that Stark had recommended her to city hall as possible candidate without declaring their relationship. I suspect that after the DA's office got notice all parties involved wanted to make this problem go away.

In early December 2006 Stark first hits on Subordinate 2 and within weeks they began a sexual affair that Subordinate 2 claims only lasted several months. This is based on testimony from Subordinate 2. It was given to DOI during a third interview on March 2, 2011 with her attorney present, with a grant of immunity, and after twice lying under oath in previous interviews. Based on subsequent evidence presented by DOI, it is quite clear that DOI does not find Subordinate 2's testimony credible.

This turnaround in testimony was caused by the lucky discovery of a June 4, 2008 email. The contents of the email contained a copy of an instant message chat between Stark and Subordinate 2. DOI, generally, was not able to access the Finance Department Blackberry instant messages. But because of technical issues Stark had copied the instant message to an email. It appears that Stark and her associates were even more open with their text messaging than their emails.

As per DOI:

"The email was a revealing glimpse into the sexual relationship Stark had engaged in with subordinates, including Subordinate 2 and Ottley Brown. ... The June 4, 2008 email was a vivid demonstration of the lack of boundaries between Stark's City agency and personal life."

DOI chose to include a direct quote by Stark from the June 4, 2008 email:

"There we are all together. My ex-lover with my current lover, with a good friend from work who was happy to sleep with me, my lover or maybe my ex. All hanging out together at my neices's party ..."
Subordinate 2 was the good friend.


Property Tax Issues Again

In January, 2007 Stark arranges for her long time domestic partner, who she was breaking up with, to get an apartment at a reduced rent at an upper east side complex managed by a firm that had received favorable tax traetment from Finance two weeks before. The following year the firm again received favorable treatment. DOI could find no supporting documentation for these downard assessments. This is a clear indication of the continuing chaos in the property tax system at Finance, five years after the bribery arrests, this time at the highest level.

On a smaller scale this episode is comparable to the Met-Life building allegation in 2005.

As of January 9, 2007 in response to negative publicity about the Patricofs, Stark instructs her PR staff to not admit to the press that there was a conflict with the Patricofs' employment at Finance. Stark was adamant in defending Allan Patricof against charges of falsifying his billings for time worked. Stark and the Patricofs are very close friends. Stark used Allan Patricof for personal and business legal matters, a COIB violation. Patricof advised Stark not to use emails for communicating with him.

On February 13, 2007 DOI sends Stark eight policy recommendations as per Patricof's billing irregularities. Finance rejects them. There were also established problems with Rochelle Patricof's influence over those overseeing her husband.

In May, 2007, DOI presents its findings to Stark that Patricof had falsified his billings. A year later Stark responds with vigorous defense of Patricof. Stark's internal emails show that she had worries over this issue. In response to the DOI public report Stark began to consider withdrawing support that she was providing to DOI. This support was both personnel and materiale, i.e. cars. Of course giving this support in the first place was bad policy and is also a violation of the city charter.

In January, 2007 Galia Galansky began working at Finance as director of employee services. Galansky admitted to being socially active with Stark.

DOI chose to quote the following June 8, 2008 email from Stark to Rochelle Patricof:

"I don't care what you say {referencing an email exchange with Galansky], she's as dumb as [Subordinate 2]. I love you but we both are crazy about two dummies. Let's face it."
DOI is pointing out a relationship between Patricof and Galansky that is the same as the relationship between Stark and Subordinate 2. DOI also is raising the possibility of a similiar relationship between Stark and Patricof given Stark's appetite.

As per February 6, 2007 and March 8, 2007 emails, Subordinate 2 was pushing Stark and Patricof for a move to a more "challenging" position.

By March 13, 2007 Subordinate 2 has been assigned to work for Galansky. Subordinate 2's salary increases from $63,240 to $72,602 during the first 6 months of 2007. Her salary increases to $81,840 during the last 6 months of 2007. There is no backup in Subordinate 2's personnel file to support these salary increases. This is also the case for Ottley-Brown's salary increases.

In June, 2007 Stark arranges for her niece to get a job at Finance.

In August, 2007 Stark hires Ottley-Brown's ex-husband at Finance, having failed to find him employment at other places. His salary was $78,000

This hiring resulted in an EEO complaint based on the non-posting of this position. Without all the facts being established the complaint was dismissed on July 18, 2008. This complaint should now be reopened.

As of November 25, 2007 Subordinate 2 is making $81,840/yr and Subordinate 2's sister starts working at Finance.


May, 2008 Stark is instrumental in her half-brother getting a job at Finance. She continued to be closely involved with his work activities and performance at Finance.

In July 2008 Ottley-Brown's is divorced from her husband.


In April, 2009 Stark and senior Finance staff, including Patricof, publicly lie about Stark's relationship with Ottley-Brown. Stark and her crowd also lie to City Hall. What were they thinking? DOI determined that Patricof knew, at least as far back as 2005, that Stark and Ottley-Brown were involved. Did you have any doubt?

On April 28, 2009 Stark resigns.

In October, 2009 Stark shows up teaching at Baruch for $99,200/yr. for two lectures a week. This is as close to a no show job as it gets. I wonder what the average salary is for an associate professor with a PhD and publications? It appears she is now also teaching at Columbia.

The truly interesting question is how far back did City Hall know about Ottley-Brown. Based on public appearances in 2005, reports by Finance employees to DOI in 2004, and my reporting to the Law Department in September, 2005, this could hardly have been a surprise to anyone in New York City.

In December 2009 Subordinate 2 is divorced from her husband.


In April, 2011 Subordinate 2 resigns from Finance. All the rest of the crowd who lied under oath and Stark herself are still working for the city.