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Wednesday, October 16, 2013

THE START OF THE OTHER SIDE

This will eventually be a very detailed posting as their are so many aspects being uncovered. The documents will spell out the details and I have obtained a small portion so far and I am awaiting many more to come.The situation started with an Internal memo that was written by the Hartford Schools Chief Financial Officer, Paula Altieri. That memo is below:

It is unclear what started this chain of events or why Altieri launched her Investigation, but after you review the facts, it will probably be clear that the Accountants should stick to accounting and leave the investigations to the investigators.

Altieri begins her memo and also her "Investigation" regarding a payment that was supposed to have been made to Segur Insurance, the City's Insurance Agent, for a payment that was in excess of $600,000. The payment was about to become past due when the Broker for Segur, Hybrid Insurance, operated by Earl O"Garro, emailed Hartford 's Treasurer Adam Cloud.

As you can see from the e-mail O'Garro e-mailed treasurer Cloud on July 18, 2013 requesting the wire transfer and also submitted copies of the invoices to Cloud. The invoices were apparently copies that were originally sent by Segur to the City of Hartford. The invoices that O'Garro submitted to cloud appeared very generic in nature with no logo or distinctive markings, the original invoices from Segur contained the Segur Logo . it appears that O'Garro created a second set of invoices to send to Cloud

Upon obtaining O'Garro's invoices , Cloud, by e-mail, forwarded them to former Finance Director Julio Molleda. Molleda replied that the checks would be cut and included in the next days check run .According to sources, somewhere along the line in the Finance department, City Comptroller Lee Ann Ralls instructed Finance department staff person Ellen Mcreary to wire the money as mentioned in the O'Garro e-mail rather than mail a check.

This is apparently where some of the problems began. Segur was set up in  MUNIS, the City's computer program, as a vendor. Hybrid was not. If the proper protocols were followed, a payment would have never been able to have been processed to Hybrid and a check cut, but apparently when the wire information was provided, that allowed the process to be violated and the money was sent to Hybrid electronically rather than a check being printed to Segur.

It doesn't appear that Adam Cloud had input on that process , other than the e-mail to Molleda requesting payment for the outstanding invoices. So far it appears that the breakdown was entirely in the Finance Department. The normal process is that for any vendor payment, the finance Director has to apply a "warrant" for the payment and is then sent to the Treasurer's Office to authorize the payment. The way it has been explained to me is that the Treasurer's Office can not simply cut a check or process a payment without the Finance Department warrant



In Altieri's memo she also makes the claim that there is no proof that the Insurance is in effect in her September 24, 2013 memo, yet her own Risk Manager, John Griffin, who apparently answers directly to Altieri sent an e-mail on September 10, 2013 stating that "National sent confirmation that coverage is in place" National is one of the Companies that provided the policy. The other company, Starr, was apparently reluctant to confirm that the insurance was in effect , but the e-mail stated that Starr was  "awaiting approval from legal" before sending any confirmation

Although on face value Altieri's accusations seem serious, once you start peeling back the layers, you might want to ask yourself what is the motivation for the memo in the first place.
 The claim that cloud moved an Insurance Policy without bidding doesn't appear to be accurate. Quotes were solicited from numerous companies for the Fiduciary Liability Policy for the Pension Commission. The policy had been in place for years. According to sources, the policy was never intended to cover the Board of Education

The changes in vendor's was approved by a vote of the Pension Commission before any changes were made

Griffin, the Risk manager began asking questions and if the policy was in effect. It is unclear what his concerns were or why the Board felt it necessary to have the policy. Somewhere along the lines , Cloud and the pension Commission solicited proposals to attempt to save the City some money on the Policy. During that process, apparently O'Garro (Hybrid) proposed a company that would save the City and the Pension Commission approximately $3,000 annually. Below is a list of companies that apparently rejected the City's proposal offer and the reasons for the rejections

.CLOUD Fiduciary Policy Rejections0001 There is much more to come on this as numerous FOI requests are hopefully complied with by the City and the Board of Education. Sources are telling me that a string of e-mails between City Hall, Altieri and Griffin may lay the groundwork for the motivation behind this and it may have nothing to do with Cloud and his relationship with O'Garro. In the meantime though it seems that not just the City of Hartford was duped by a slick operator. Earl O'Garro is being chased by numerous entities who also apparently fell for his smooth talk. Included are the State of Connecticut who are calling O'Garro's loans in default and due in full. For more on O'Garros defaults read Jeff Cohen here

One source who spoke on the condition of remaining anonymous said he felt pretty confident the City's Insurance payment is gone along with O'Garro. He further stated that he believes O'Garro got caught up in a "High roller" lifestyle and in the end the bills caught up with him. O'Garro's homes are apparently headed into foreclosure, the restaurant he opened for his wife in Middletown was apparently suffering losses of over $30,000 per month in operating costs and many other losses that are public record now.

Since the payment was made to the City's broker, the City will suffer no loss. Under Connecticut law, it is apparently up to the Broker and the Agent to battle out who suffers the loss, but it won't be Hartford

Among those losses are the Cloud Family as well, Chris Cloud is apparently owed a large past due amount from O'Garro for his lobbying fees and the Cloud Family hasn't apparently seen a rent check from O'Garro for the 30 Lewis Street Office in some time.

Much more will be developed on this as time goes on

Sunday, October 13, 2013

TWO SIDES TO EVERY STORY, THE OTHER SIDE OF THIS ONE IS COMING

The documents regarding the City of Hartford Treasurer Adam Cloud and his handling of an insurance payment , on face value look bad. But over the past week I have gathered numerous documents and e-mails and conducted hours of Interviews trying to get to the full story.

It is coming together and is taking some work to get it all into a format to be easily understandable .I hope that when it is posted and the documents are read, it will paint a clearer picture. I hope to get that done by the end of the day today.

In the meantime, Treasurer Cloud released a statement that I am posting now  as well as the original memo from the Board of Education's Paula Altieri. Much more will be coming out on this



WHY BRUCE RUBENSTEIN NEEDS TO GO

The answer is simple, because Hartford's Deputy Corporation Counsel L. John Van Norden says so. Shouldn't that be enough for us? L. John says so.

It is not good enough for me. I can look at the situation and see that since Rubenstein has been appointed to the Hartford Internal Audit commission, times have become very difficult for Van Norden's bosses, Saundra Kee-Borges and Pedro Segarra.. Too bad.

The facts are the facts and the fact is that the Internal Audit Commission has gotten over a severe case of "low T" since Bruce was appointed by Hartford's Treasurer Adam Cloud. The Audit Commission has grown a spine and has realized they do not answer to Hartford City Hall. They are there to keep City on the right path to best serve the people of Hartford.

The Audit Commission is actually producing some very good reports, identifying problems and forcing change. That  is what they were designed to do. I think it is hitting too close to home for the City Hall power brokers as their incompetence is being identified publicly now  and really causing people to question what is going on. The Keney Park Tree Audit should have everyone shaking their heads and questioning "how could this happen?'.

 Are we really supposed to believe that no one in City government ever questioned the presence of logging trucks and equipment traversing the Golf Course  or no one noticed hundreds of large Oak stumps across the course.

Was it really up to Rubenstein and the Auditors to identify abuse of City vehicles and force the establishment of a solid vehicle use policy? Wasn't the Mayor's former Chief of Staff stealing his City vehicle enough to get the Administration to realize they had a problem. Wasn't the fact that there was apparently no centralized list of who even had City Vehicles troubling enough to do something?

Did it really take the crash of two City vehicles to get something started, one accident definitely alcohol related and the other questionably alcohol related, as well as a questionable time line before the accident occurred? Did it really have to fall on the Rubenstein and the  Audit Commission to be the heavies?

 The obvious answer is yes. In a City that is spiraling out of control due to a lack of leadership and management, I am appreciative that we do have a few people willing to pit their necks on the line to protect us. Hartford's Auditors Patrick Campbell and Craig Trujillio I am sure are having some sleepless nights. Even though they are supposed to be autonomous from City Hall, their paychecks still come from Hartford City Hall.

They are doing audits and filing reports that are not pleasing City Hall ,I am sure of that.

In Van Nordens letter below he essentially telling Hartford Treasurer Adam Cloud, "get rid of Rubenstein or else" . Cloud is the appointing Authority  for Rubenstein to the Internal Audit Commission  as authorized under the Hartford Municipal Code.

In the letter, Van Norden threatens the use of a "quo warranto" action if Cloud doesn't comply with his demands. In the United States today, quo warranto usually arises in a civil case as a plaintiff's claim (and thus a "cause of action" instead of a writ) that some governmental or corporate official was not validly elected to that office or is wrongfully exercising powers beyond (or ultra vires) those authorized by statute or by the corporation's charter.

Where is the threat for Segarra's Department heads who should fall under the same type of action when they breach their contracts and aren't residing in Hartford as required by the Municipal Code?Apparently they aren't challenging the Mayor's competence and powers the same way as Rubenstein and the Commission are.

Van Norden seems to be concerned regarding a possible Conflict of Interest of Rubenstein being on the commission, yet conflicts have never seemed to be in the sights of Corporation Counsel in the past. Where was the concern when the previous Chairman of the Internal Audit Commission, who by the way resigned shortly after Rubenstein arrived on the scene. The Chairman was a high ranking official with Webster Bank. A financial institution that the City of Hartford did business with.

Why was there no concern about a conflict there. Maybe because the Internal Audit Commission were the quiet lapdogs they were supposed to be and never stirred the pot , never challenging the Mayor or City operations. The focus was more on whether or not the nickels in the Cashiers office were being stored in the correct tray in the cash register. The scope of the investigations conducted in the last six months have been huge and requiring a large amount of staff hours, but they are rising to the challenge and doing some great work

If van Norden feels he has the grounds for his "quo warranto" action, I say bring it on and let a judge decide. I somehow feel that will be another mark in the defeat column for Van Norden and his legal "career".

Here is Van Nordens letter to the Honorable Adam Cloud, Treasurer of the City of Hartford.


Tuesday, October 8, 2013

SCHENECTADY DEJA VU: L.JOHN, YOU'RE FIRED

In what may be history repeating itself, a resolution is being introduced for Tuesday night's Council meeting to remove Deputy Corporation Counsel L. John Van Norden from his position.

Van Norden had previously left Schenectady , New York under a cloud of suspicion as their City Attorney. You can read that story here.

The resolution is being introduced by Councilman Larry Deutsch and sources are telling me that other Democratic Council people will possibly be signing on to the resolution. I am also being told five votes required for the passage are probably a good bet.

Van Norden has had his issues on numerous occasions recently for intemperate behavior in dealing with the Council and related City business including an  e-mail describing Councilman Raul Dejesus as apparently having mental health  issues.

Here is the proposed resolution:


CAPTION THIS

Take a couple minutes if you have time and go to courant.com and add a caption to the drawing above by clicking here


My thought, "This is Hartford, they all said they had the green light" or maybe "Sandy, don't
forget the Crabshack free drink coupons"

HPD HIRING DRIVE

Please share: The City of Hartford is recruiting for Police Officers. Applicants must be 21 years of age by January 8, 2014, must be a citizen of the U.S. and must have a high school diploma or GED and a driver’s license. Extensive testing is required. Hartford residents will have 10% added to their passing grades. Applications will be accepted until Friday, November 22, 2013. For more information or to apply, visit the Human Resources Department on the ground floor of Hartford City Hall, 550 Main Street.