- 4 months ago
A look at the effects of corruption on a city government's day-to-day operations.
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00:00Funding for Frontline is provided by this station and other public television stations nationwide, and by the Corporation for Public Broadcasting.
00:11Tonight on Frontline, the biggest corruption scandal in New York City in 50 years.
00:19Everybody struggles for why did this happen, and how could it have happened in New York City, or anywhere else.
00:25Now, on the very basic level, you have greed. This is fast money, and it's not taxable.
00:33An inside look at the prosecution of crooked officials, and a bribery scheme involving hundreds of thousands of dollars.
00:40The practice of politics in this city stinks.
00:43Tonight, the politics of greed.
00:46From the network of public television stations, a presentation of KCTS Seattle, WNET New York, WPBT Miami, WTVS Detroit, and WGBH Boston.
01:07This is Frontline, with Judy Woodruff.
01:14Good evening.
01:15Tonight, the anatomy of a scandal, the lessons and questions it holds for all of us.
01:21The scandal is New York City's, a complex investigation into bribery and corruption which began a year and a half ago and still continues.
01:31But it's a story that is not unique to New York.
01:34It's happening in Philadelphia, Boston, Chicago, Washington.
01:38Public officials betraying public trust and illegally profiting from their public office.
01:45Our cities are in trouble.
01:48Our frontline report is about what happened in one and how it cast a deep shadow on the trust that must exist between citizens and those who serve them.
01:59Our program is called The Politics of Greed.
02:03It is produced by Edward Gray.
02:05The senior producer and reporter is Mark Obenhaus.
02:09New York City is the biggest and richest city in our country.
02:16Its economy generates nearly $150 billion a year.
02:21The scale, the sheer numbers of buildings, people, cars, and businesses governed by the city, have made corruption an inevitable fact of political life.
02:31But few New Yorkers were prepared for the revelations of 1986 when the integrity of the entire political system was shaken by the worst corruption scandal in 50 years.
02:44We've committed no crimes and I'm confident that we'll be vindicated.
02:47Are you satisfied with the jury?
02:49The practice of politics in this city stinks.
02:51I mean, it is an old-fashioned way of practicing politics that becomes the kind of atmosphere from which people easily learn that the way to do things is through bribery.
03:07The way to do things is to grease things.
03:09The way to do things is to pay money, to pay favors, to give favors, and not to try to get things done on the merits.
03:14Rudolph Giuliani is a man with a mission.
03:18During the last year, he has directed a series of high-profile federal investigations that have led to the indictments or resignations of over a dozen public officials,
03:28culminating in the trial and conviction of four men on charges of taking over an entire city agency and running it for their own personal profit.
03:37The agency involved, the Parking Violations Bureau, or PVB, brings in more money to city government than any other source except taxes.
03:47Last year, the PVB issued 11 million tickets and took in $175 million.
03:54The importance of the PVB case is that it dramatically illustrated how pervasive and how high up corruption went in New York City.
04:05Selwyn Rabb covers the criminal justice system for the New York Times.
04:09What you had here was a group of top Democratic leaders in New York, two of the top Democratic leaders in New York,
04:18the borough president of Queens and the Democratic leader in the Bronx, using a parking violations bureau, a major city agency, as a criminal enterprise.
04:28Stealing, rigging contracts, in a sense, corrupting a major institution pervasively and systematically.
04:39The roots of the corruption scandal lay in the temptation which the PVB's huge annual take represented to the public officials who controlled it.
04:48Money.
04:49Money.
04:50Money.
04:51I mean, let's get to it.
04:52I mean, that's why it's done an awful lot of time.
04:55They like money.
04:57And this is fast money.
04:59And it's not taxable.
05:01And so they can get their hands into that.
05:04And there are a million ways to get their hands into that.
05:06And these are rather alert minds that are looking at all this possible money and they get into it.
05:11And that does it.
05:13And the fact that, you know, there's a double standard or a triple standard around where, you know, one thing works here, but you don't have to be quite as honest there.
05:23You can be totally dishonest over here.
05:26And it's not always found out.
05:28I mean, this was going on for several years and it's been going on for years and years.
05:32And there are people out there right now with their pockets full who are never going to get caught.
05:36Is there an MLS involved?
05:38Mostly it's Donald Maness, the power of president.
05:41It's all cut up.
05:42For New Yorkers, the year of scandal began with this news report.
05:45At two o'clock on the morning of January 10th, 1986, one of New York's highest elected officials, Donald Maness, was found in this car, bleeding from his wrist and ankle.
05:56Maness was Mayor Edward Koch's closest political ally.
06:00He was the borough president and Democratic Party boss of Queens, one of the city's five boroughs.
06:06He was also a member of the city's highest legislative body, the Board of Estimate.
06:11By sitting on the Board of Estimate, he could determine almost every contract that developed in the Board of Estimate that concerned Queens.
06:19And at the same time, by being a party leader, he had this enormous clout in deciding who would be a judge, who would get all sorts of favors.
06:28So he had this dual role, which gave him a more powerful position than most borough presidents.
06:34The borough president is a powerful person in his own venue, but he had this extra muscle that nobody else in New York had.
06:41Beyond his power in local government, Donald Maness was also a force in national politics.
06:47His ability to deliver the votes in a community of two million people made his endorsement eagerly sought after by candidates for president of the United States.
06:57The last time I saw Donald Maness was the week between Christmas and New Year's. I bumped into him in City Hall and asked him something about...
07:04Barbara Ross is a reporter for the New York Daily News.
07:08She covers city politics and was one of the principal journalists reporting on the corruption scandal and Donald Maness.
07:15And he was just a space cadet. I mean, he was just like, he wasn't focused. He wasn't answering the question. His voice was hoarse. His complexion was ashen. He was sweaty.
07:30And he just sort of like gave, just sloughed off the answer. He sloughed off the question. And it wasn't like him.
07:38I mean, Maness was the kind of guy. He'd see you in City Hall. He'd put his arm around you and he'd say,
07:43How you doing, kid? You know, and he'd tell you a funny story. He was, he was just a very, very lovable bear.
07:49And this was not the normal Donnie. And you sort of, at the time I remember thinking, well, gee, you know, I guess he's having a bad day. He's, uh, he's not quite tuned in.
08:01Little did I know how tuned out he was.
08:06Maness was taken to Booth Memorial Hospital. Among the first to visit at 3.30 in the morning was Mayor Edward Koch.
08:14He wasn't in a, uh, state, uh, where, uh, he could be, uh, interviewed. So I really don't know what, uh, happened.
08:22Uh, thank God, uh, there's nothing life threatening and, uh, he's gonna be alright.
08:27Maness told the police he had been knifed. The chief of detectives held a press conference.
08:34At some point he realized there were two males in the back seat.
08:40He cannot offer any description at all.
08:42Maness had told the police that he had been kidnapped and attacked by two men who had been hiding in the back seat of the car.
08:50He remembers being hit in the neck and thinks he was hit in the back.
08:56He was told to drive to Flushing Meadow Park, but doesn't remember any conversations.
09:03Is this a credible story?
09:05Well, drawing on my years of police work, I always take at face value what's given to us by a complainant.
09:11Almost no one believed Donald Maness' story. Even his friend the mayor was skeptical.
09:17Do I care whether, uh, he, uh, was, uh, with a hooker? Who cares if that was the case?
09:27Do I care except from the emotional point of view of what might have motivated an attempted suicide if that were the case?
09:35Does that make him less from me? No. He's my friend.
09:39What the mayor and the public did not know was that Donald Maness' fate had been sealed two weeks before he was found bleeding in his car,
09:47when agents of the FBI confronted this businessman, Bernard Sandow.
09:51It was December 20th, 1985. I was in my office. I was getting ready to go down to my home in Florida, where I commuted almost every weekend.
10:03And I was just about to leave to the airport, and it was approximately two o'clock.
10:07And Agent Joe Persichini from New York and Daryl Jenk from Chicago came into my office, and Joe Persichini told me, he says,
10:15uh, Bernie, this is the most, uh, important day of your life.
10:19Uh, we have evidence that you've been paying the Queensboro president, the Parking Violation Bureau commissioner,
10:29and assistant commissioner monies, and, uh, we want you to cooperate with us.
10:36I, uh, was very, very nervous, because nothing like this ever happened to me.
10:40I made notes and told them I wanted to have an opportunity to contact an attorney.
10:46Bernard Sandow was president of Systematic Recovery, a private collection agency.
10:51The PVB used collection agencies to pursue unpaid parking tickets.
10:56The companies kept the percentage of the money they collected as their commission.
11:00Sandow would testify that officials at the PVB were demanding kickbacks in exchange for business.
11:07In one year, uh, my company, Systematic Recovery, received 93 million dollars in business.
11:14The major clients, uh, that weren't municipal agencies, such as banks or department stores,
11:21uh, if somebody got three to six million dollars in business, it would be considered a tremendous amount.
11:28And yet here was this municipal agency that could give out 93 million dollars of business.
11:34It was staggering.
11:35And anyone who owned a debt collection service at that time, uh, I guess their mouths would sort of water
11:43to have the opportunity to collect that much business.
11:48And, uh, I was, uh, greedy.
11:51And, uh, when I had the opportunity to be very successful, I got caught up in the possible earnings
12:00of Systematic Recovery and myself, and therefore had agreed to pay off.
12:06He was told you either pay or you don't get the business.
12:10Ira London is Bernard Sandow's lawyer.
12:14It's a matter of degree.
12:16How different is that from, uh, a six foot six, 250 pound man walking in to your film studio
12:29and saying, uh, I don't think you want any equipment broken here during the week.
12:36We can ensure that if you pay us $25 a week.
12:40I'm just making that up.
12:41But how different is it?
12:44The point is, if you want to stay in business, you have to pay.
12:49And someone who has the authority to enforce that is telling you that.
12:55Either someone who's very big and large and threatening, or someone who has the power.
13:01Mr. Lindenauer, do you have anything to say at all?
13:03Mr. Lindenauer has no comment.
13:05Jeffrey Lindenauer, the deputy director of the PVB, was identified by Sandow as the man he had to pay off.
13:12Lindenauer was arrested by the FBI and charged with extorting over a quarter of a million dollars in bribes.
13:19Lindenauer was placed in his job by his longtime friend, Donald Maness.
13:25At the time, the connection between Maness and what was going on in New York as far as the corruption in New York
13:33and the whole sting operation and all of that, we did, uh, we did not know.
13:38Did you suspect?
13:40Uh, I don't know. We were working so hard at that point, I don't know what we suspected and what we didn't.
13:46Uh, we were just running after the story. We knew we had a story.
13:49And it was a question of, uh, what was going on.
13:52And it wasn't just having a story. It was a question of opening up a whole cesspool in New York.
13:57One week after Lindenauer's arrest, Maness called the press to his hospital room to read a statement.
14:03The truth of what happened to me on the night of January 9th is, as the police have said,
14:08The wounds I received that night were self-inflicted. There were no assailants and no one but me is to blame.
14:15I apologize deeply to the police officers and investigators for the Queens County District Attorney's Office for misleading them where they tried to come to my aid.
14:26I was confused and embarrassed and felt disgraced by what I had done to myself.
14:31Maness answered no questions and would say nothing about the reasons for his suicide attempt or about the arrest of his friend, Jeffrey Lindenauer.
14:40Most of all, I apologize to my family for putting them through this ordeal.
14:45I have always known how wonderful they are.
14:48And I realize more than ever how much I have to live for.
14:54Donald Maness was clearly a man with something to hide.
14:57But as yet, the government did not have a case against him.
15:00Bernard Sandow had provided the prosecutors with nothing more than his suspicions that the money he paid ended up in Maness' pocket.
15:08Jeffrey Lindenauer was refusing to answer any questions about his relationship to Donald Maness.
15:13The day after Maness' hospital press conference, this would change.
15:18And New York's second most powerful politician would be named as the mastermind of the bribery scheme.
15:24At Michael's initiative, he and I met yesterday with the United States Attorney to discuss certain matters relating to the parking violations bureau and Donald Maness.
15:34It will become clear that Mr. Dowd was pressured by others abusing their official positions.
15:40A co-owner of a collection agency, Queen's lawyer Michael Dowd, charged that Donald Maness had personally directed him to pay bribes.
15:49Dowd said that to maintain his Parking Violations Bureau contract, he had to pay kickbacks to Jeffrey Lindenauer.
15:56He had quit paying the bribes 18 months before the scandal broke.
16:01The choice was either pay and have the company exist, which was entitled to exist because of its good work or not to pay and let the company go down the tubes.
16:15And, you know, I felt like somebody standing at the foot, and I've used this, I've said this before, I felt like a person standing at the foot of a volcano with the lava coming at you.
16:25There's just no way you're not going to get hurt.
16:28And, you know, it just depends on how bad.
16:32And it's a frustrating feeling.
16:34I mean, to know that you did nothing more than exist to, I mean, I've searched for a reason.
16:47Why did they do this to me?
16:48What did I do?
16:49I didn't go to them and say, you know, can we be partners?
16:54They made the threat to me.
16:56Dowd was, I think, very much affected by the Maness attempted suicide.
17:02I think he realized that this scheme that he had been involved in, about which he had always been extremely guilty.
17:09I mean, he's, I think, the only person in this entire scheme to have voluntarily walked out on it.
17:15Some other people were annoyed with it, upset with it, but went along with it.
17:20Others enjoyed it because they were making a lot of money out of it.
17:22Dowd was the only person who had the character and the moral fiber to walk out on this scheme long before anybody knew about it.
17:32Because it disgusted him.
17:33I mean, the prospect of actually walking into Donald Maness' office and paying him cash made him upset.
17:41Dowd, I think, had carried that guilt with him for a long, long time.
17:45And when all of this started breaking, he decided that he had to, that he had to tell somebody about it.
17:52They came to me through Shelly Chevrolet, who was my friend, with a threat to me and said to me, you pay protection.
18:02You know, it's no different than if they came to me and said, we are going to slit your tires every day if you don't give me $20 a week to protect your car.
18:15And that's exactly what they did.
18:18And it was a protection racket.
18:22And I think it's uglier than when some cheap two-bit hood threatens to throw a rock through your window or slit your tires.
18:34And the ugliness is because of this guy who has the power to dominate the system that's designed to protect people.
18:41That's what's really ugly about this thing.
18:43You know, municipal corruption comes and goes.
18:46Some people in an agency have a deputy commissioner or a commissioner, maybe, or inspectors.
18:51And, okay, you expect this.
18:53All of a sudden, you had somebody saying, it's not just that level.
18:58This is very big.
18:59This is big in New York City.
19:01And it had been years since anyone had directly implicated someone on the level of Donald Maness in corruption.
19:08And beyond that, it wasn't just corruption.
19:11It was a very kind of crude, extortionate corruption where someone was, he was personally saying and, you know, had the gall to approach someone on a sidewalk outside.
19:26It happened to be outside a funeral and say, you want your contract?
19:29You go pay my boy, Jeffrey.
19:31Not in those words, but that's the gist of it.
19:34It was that crude.
19:36And so, all of a sudden, you had a major political figure in New York City directly implicated in municipal corruption on an extremely crude level.
19:44And the story just exploded at that point.
19:49I would have staked my life on the honesty of Donald Maness.
19:57But nevertheless, even though he is someone who I would have allowed to be the executor of my estate, I've known him for more than 20 years, I am convinced now that he engaged in being a crook.
20:11The press's effect on Donald and on Marlene was absolutely oppressive.
20:18They had reporters around their house 24 hours a day.
20:24Donald, who had been told by the, we had been told that if he learned what was going on, that it could get him agitated and because of the heart condition that he had, it could kill him.
20:41I said that publicly.
20:43And reporters went up to the windows of his house and tried to show the headlines through the blinds on the inside.
20:51And whenever he went out to visit a doctor, as he did occasionally, there would be a phalanx of reporters around him shoving microphones in his mouth.
20:59I've been advised by my doctor to give no interviews, so I just, I think I'll follow the other guys if it's all right.
21:06Are you going to go and talk to the authorities?
21:07Sonny, over here.
21:08Are you going to talk to the authorities soon, Mr. Maness?
21:12A lot of people apparently are waiting to talk to you.
21:14Well, everybody wants to talk to me. Of course I'll talk to you.
21:17While the press was pursuing Maness' every move, they were also hounding his good friend Jeffrey Lindenauer.
21:24It was discovered that Lindenauer's qualifications as a city official were questionable at best.
21:30In the 1960s, Lindenauer had purchased a phony doctor's degree and established a psychotherapy institute where he admitted having sex with his patients.
21:40There is no way to characterize Jeffrey Lindenauer. God made him up on an off day.
21:47Well, you know, he was the so-called amateur sex expert and sex doctor and whatnot.
21:56And he looked like an unmade bed and capped with a hat.
22:03And the hats were interesting. We did a whole thing on the hats of Lindenauer.
22:07He was just a guy that rolled into this thing and saw some money lying around and had a connection with Donny Maness.
22:16And he was off and running.
22:18As part of their effort to substantiate the charges against Donald Maness, Giuliani and his staff were probing the curious relationship between Maness and Lindenauer.
22:27Assistant U.S. Attorney David Zorno had principal responsibility for investigating Jeffrey Lindenauer.
22:33Who knows what about the particular personalities made the friendship click?
22:40But it did click.
22:42It turns out that they had in common.
22:45We know the fact that Maness's father had committed suicide early in Maness's life.
22:50Lindenauer's father committed suicide later in his life around the time that he became close with Maness.
22:57And maybe that was something that drew them together.
23:00But in any event, they did become close.
23:03I think what really engendered the relationship that later led to the bag-man-patron relationship,
23:11that developed, I think, when Lindenauer suffered severe financial catastrophe.
23:17That happened in 1974.
23:19He had this Institute for Emotional Education.
23:23It was his psychological institute.
23:27And it went bust.
23:28It went belly up.
23:30And for two years, Jeffrey Lindenauer was unemployed and in a very bad way.
23:35And as he described it, it was Donald Maness who really got him through that period.
23:40Maness continued to socialize with him, saw him every week, and began helping him find a job.
23:48And where would Donald Maness go to help a friend in need?
23:53He would go to city government, where he had power, where he had the power of patronage.
23:57What background did Jeffrey Lindenauer have to be the number two person at the Parking Violations Bureau?
24:02What background did he have in parking violations, in adjudication, in transportation?
24:07He was a makeshift psychologist.
24:11He got the job because Donald Maness pushed him into the job.
24:14I mean, when that becomes the practice, then I think you're on the road to a very corrupt situation.
24:23One man who knew both Maness and Lindenauer was former Queen's Democratic boss Matthew Troy.
24:29Troy's political career was ended when he was convicted for income tax evasion.
24:34When you give permission to a political leader who has to fill jobs from the clubhouses because the people have come to him looking for a job
24:41because they can't get jobs in other areas, then intrinsically you're opening up an area where you're going to, if not force the corruption,
24:50you're at least putting it into a position where it's there if they want it.
24:53Particularly when you get a shark like Lindenauer in there.
24:57I mean, he made the great whites of Australia look like they were swimming in a tank in somebody's house for crying out loud.
25:04He completely corrupted the entire system for his own benefit and good.
25:10I don't think he was an unwitting dupe either.
25:13I think he was part and parcel of the strategy and planning of it.
25:16He had a constant refrain that Donald Maness was his best friend.
25:20Donald Maness had saved his life.
25:22Donald Maness had done everything for him.
25:24He owed his whole life and everything in it to Donald Maness.
25:27And he sounded like a character out of the Manchurian Candidate.
25:32He'd been brainwashed in career, you know, and came back and was talking about Lawrence Harvey as the best human being that ever lived.
25:38And he just didn't want to hear anything.
25:42He wanted money.
25:43He would call and call and call, would stall and stall and stall and call and call and insist on meetings.
25:53He'd go any place at any time to meet, to shake us down.
25:59Giuliani's problem was how to overcome the strong bonds between Lindenauer and Maness and convince Lindenauer to betray his friend.
26:07On February 24th, 1986, Lindenauer was indicted on 39 separate federal charges.
26:14Only days later, he folded.
26:16Lindenauer pled guilty to reduce charges and agreed to testify against Donald Maness.
26:22Maness remained incommunicado in his home while Jeffrey Lindenauer was telling federal prosecutors that he and Maness had collected hundreds of thousands of dollars in cash bribes
26:34and that they had been scheming with other prominent political figures to make millions more.
26:39As a prosecutor, you come into contact with different types of criminals.
26:44Somebody like Donald Maness, up here in his head, views himself the way he wants the public to view him.
26:51As a paragon of New York City.
26:54As a potential future mayor of New York City.
26:58As a powerful person.
27:00As a person who Michael Dowd described walked arm in arm with Jimmy Carter down Queens Boulevard.
27:07And that type of criminal defendant is leading really a double life.
27:12On the one hand, he is the respected politician, political leader.
27:17On the other hand, he has this dirty little secret.
27:20And the dirty little secret is that the same day that he's sitting on the board of estimate,
27:25he's meeting Jeffrey Lindenauer in Anton's restaurant in Queens and going into the bathroom and taking $5,000 in cash.
27:33And I think for someone like Donald Maness, whose image was so important to him,
27:38who lived, I would think, as many politicians do for their image,
27:43and who spend a great deal of time attempting to create an image,
27:47that when he realized that the truth, that the dirty little secret was going to come out,
27:52that that created a tension psychologically within him that was just untenable.
27:58He could not live having been exposed in this manner.
28:02We had begun...
28:03Three days after Lindenauer's guilty plea,
28:05Donald Maness went to his lawyer, Michael Armstrong.
28:08...preparing his defense, and he was going over documents and working on things.
28:13And as I say, he appeared to be very agitated, not by going over the documents.
28:19Indeed, we had trouble making him concentrate on the documents.
28:24He seemed to be very agitated and disturbed and, I mean, perfectly rational, perfectly...
28:30It wasn't that he was hallucinating or anything, but he was obviously quite depressed.
28:36And at the end of the day, he went home and he said he was going to have dinner that night with his family at a relative's house.
28:45And then he was going home from there.
28:47And, as I say, I'd recommend it to Marlene that she ought to get him in the hospital over the weekend, right away.
28:57And she said yes, and they had discussed it, and I was down here working at the office, and continued to just...
29:06I was just working, and I forget what time it was, it was fairly late, and we were working on various matters.
29:12And I got a phone call from a reporter asking me if I knew why an ambulance would have pulled up in front of Maness' house.
29:22On the night of March 13th, 1986, Donald Maness committed suicide by stabbing himself in the heart.
29:35At 10.15, two police officers from the 107th precinct arrived and found Donald Maness face-up in the kitchen with what appears to be a single, self-inflicted stab wound to the chest.
29:54Mr. Maness was talking on the phone to his psychiatrist, and he was in the kitchen, and his wife was in another room on an extension phone in a three-way conversation.
30:07At one point, the psychiatrist had to interrupt the conversation due to a knock on his door at his residence or office's, and when he got back to the phone, he heard what appeared to be screams coming through the line.
30:26It was very sad. I mean, I got to tell you, the people who covered him were really very saddened by all that happened.
30:39You can get, on a certain level, you can get angry that people violated a public trust, but when you've covered these people for years and you trusted them and you sort of became friendly with them, it's very painful to see somebody do what he did to himself.
30:56I mean, I know members of the press corps that were in tears. It's just, he was sort of a friend, you know? And it's, um, maybe we're all fools.
31:08Or maybe there are more bad guys out there that are among the guys we pal around with and cover that we should be more leery of.
31:19It's just a terrible human tragedy. I mean, I don't, I don't think that even the most seasoned political reporters in this town ever covered anything quite like Donald Maness' story last year.
31:30Donald Maness, like all of us, had within him and did, in fact, do many good things and some that were not so good.
31:51I believe that what he did that was good will overwhelm that which was not.
31:58One of the many politicians attending the funeral was Maness' good friend, Stanley Friedman.
32:04In the days that followed, Friedman would take Maness' place as the central figure in the corruption scandal.
32:10The federal prosecutors were investigating Friedman's connections to the Parking Violations Bureau.
32:16This investigation is continuing. There's a great deal of money involved and the FBI and my office and the Department of Investigation will continue the investigation.
32:31At this point, beyond saying that, I really can't indicate whether there are other people involved or if there are other people, how many other people.
32:39Maness would have been, in my opinion, and you don't really want to do a lot of talking about the dead, although we've talked about Maness a lot.
32:47I think Maness would have been convicted. I don't think there's any question about it.
32:52But Maness was dead. And Lindenhauer had already, you know, they already had Lindenhauer and there were some others.
33:00But Stanley Friedman was terribly important to this case and terribly important to the city in terms of what we could understand had happened.
33:09Stanley Friedman was the Democratic Party boss of the Bronx, one of the city's five boroughs.
33:19Although he held no elective office, Friedman was the premier power broker in New York City politics.
33:25As a lawyer, he represented companies seeking city business and earned nearly three quarters of a million dollars a year.
33:32Friedman had a reputation of being only behind the scenes. I mean, Friedman was not a person who was seen out front in fighting for causes in the Bronx.
33:45Friedman was, if anything, considered the master manipulator of deals.
33:51I mean, that was a reputation he had for a long time. When he was a deputy mayor, it was the same thing.
33:56Everything had to go through Stanley Friedman. But he wasn't interested in courting the press.
34:00Manus was. Manus called you back. Manus was very polite, very engaging.
34:06Stanley Friedman, I don't think, gave a care two cents about what the press said about him.
34:10And all he cared about was his power and how he could control the Bronx and whatever, and other agencies in New York City.
34:18He wasn't looking for publicity. I think Friedman realized that too much exposure might not be the best thing for a politician, the way he operated.
34:27Wayne Barrett is an investigative reporter for the Village Voice, a New York City weekly.
34:32He has long been a critic of Stanley Friedman.
34:35He has never run for anything in his life, and yet he was the second most powerful man in New York City politics.
34:41Now, how did he become that? He became it simply because the Bronx organization was something he controlled with an iron fist.
34:49He could raise enormous amounts of money, political contributions, from contractors with the city, some of which he represented, some of which he didn't represent.
34:58But all of whom he could do favors for at a city-wide level.
35:02So he had the tremendous ability to raise money. He had tremendous control over an entire county's politics.
35:08And so he became an extraordinary, powerful figure. But he has never run for anything in his life.
35:15Stanley Friedman is a fantastic deal maker. He can take two people who hate each other's guts and bring them together and have them see self-interest.
35:23Josh Friedman is a Pulitzer Prize-winning reporter for New York Newsday. He has known Stanley Friedman for 12 years.
35:30Then Mayor Abe Beam was elected. He drew Stanley into City Hall.
35:35Stanley started working his way up. He was sent up to Albany, where the state legislature is, to make deals up there for the city. That's where I met him.
35:42He was brought back to the city. All of a sudden, we had this enormous fiscal crisis when the city nearly collapsed.
35:49Some people think Abe Beam was unable to really deal with a lot of what was happening. But Stanley was. He was very shrewd, very smart.
35:56And in a positive sense, he helped the city through this horrible fiscal crisis.
36:00Then, and somewhat tragically, Stanley allowed his own greed and selfishness to come to the forefront.
36:11The deal, which would be Stanley Friedman's undoing, involved the Parking Violations Bureau.
36:16Friedman helped a company called CitySource win an exclusive contract to manufacture hand-held computers that could issue parking tickets.
36:25In return for his services, he was made the company's largest shareholder.
36:30Stanley would have benefited a great deal if this thing had gone through because this thing being the city source contract in which they were going to sell this high-tech gizmo to the Parking Violations Bureau.
36:43And once they had their contract, they all owned stock and it was going to go up enormously in value into the millions of dollars.
36:52Stanley gets that contract into the Parking Violations Bureau and his stock becomes big bucks, lots of money, a million dollars.
37:00So, he is going to gain by making sure that Mannis and Lindenauer get bribed because they control the Parking Violations Bureau that's going to award the contract.
37:13Friedman had crossed the line. He broke the law when he bribed Mannis and Lindenauer with promises of stock in the company.
37:20Stanley Friedman, he paints the picture of a guy who was just basically, and he's almost proud to say this, an unethical politician.
37:27I mean, a guy who made big money from his contacts with the city while he was in charge of a political party in one of the poorest counties in America.
37:35He was making $900,000, most of it selling his political influence.
37:39Well, that's reprehensible. That's annoying politically. That isn't necessarily criminal.
37:43But the same guy who was doing that was also making millions of dollars or attempting to make millions of dollars from bribes.
37:49That's the part that's illegal.
37:51Rudolph Giuliani charged Stanley Friedman with racketeering.
37:55The indictment alleged that Friedman and three others took over the Parking Violations Bureau and ran it as a criminal enterprise.
38:02Stanley Friedman denied the charges. Unlike his friend Donald Mannis, he would take his chances in court.
38:09He protested his innocence and claimed he was a victim of anti-corruption hysteria.
38:14The headlines dictated indictment.
38:17The result? We're here today in this courthouse.
38:22Our judicial system, with all its shortcomings, is still the best known to man and the best in this world.
38:32I have faith in it and will vindicate me, CitySource, and all the directors that are here today.
38:38Friedman's attorney was Thomas Puccio, himself a former federal prosecutor.
38:43The name of the game today is, and I quote,
38:45Make the facts fit the headlines.
38:48A temptation, I suggest to you, that even the most conscientious and respected prosecutor might find it difficult to resist.
38:55One cannot help but add that thrown into the mix is the fact that a suicide, but a few days ago, created an empty chair which Stanley Friedman is now being asked to fill.
39:05Stanley Friedman has broken no laws and he has done nothing which runs counter to the ethics of the municipal marketplace.
39:14Beyond the charges relating to the handheld computer, Friedman was also accused of two other bribery schemes involving the PVB.
39:22His co-defendant, Marvin Kaplan, was the businessman whose company manufactured the handheld computers.
39:29Lester Schaffron, the former director of the PVB, was charged with accepting money, gifts, and meals from a collection agency president.
39:38And real estate developer, Michael Lazar, the city's former commissioner of transportation, was charged with paying Lindenauer and Manis cash bribes on behalf of yet another collection agency.
39:50The government contended that these acts constituted a pattern of racketeering and charged the men under the racketeer-influenced and corrupt organizations law, or RICO.
40:00Under the RICO law, they each faced up to 40 years in prison.
40:05The severity of the law raised questions about Giuliani.
40:09Was he being overzealous in his crusade against corruption?
40:13Assistant U.S. Attorney William Schwartz tried the case with Rudolph Giuliani.
40:19What happened was a group of public officials and businessmen and politicians took a public agency, the Parking Violations Bureau, and they just twisted it and turned it into a vehicle for private profit.
40:32That was the crime they were accused of. That's racketeering.
40:35The crime of RICO focuses on the taking of an enterprise, the PVB, and using it illegally for your personal benefit. And that's exactly what they did.
40:46I don't think Stanley Friedman is a racketeer. That's nonsense.
40:50You know, when you think of racketeer, you think of Edward G. Robinson and these gangster movies he made.
40:58In fact, that's where the name RICO came from. There was this great movie with Humphrey Bogart where Edward G. Robinson is lying there dying and he says,
41:06Mother of God, is this the end of RICO? That's where RICO comes from. It's a great name.
41:12I mean, Stanley Friedman is not a racketeer like that. He's a deal maker. He's a broker. He's a political leader. He's a negotiator.
41:22A negotiator, you know, you can question whether he does it right or wrong. But to me, a racketeer is someone, you know, who has a gun in his pocket or people around him with guns and they kill you if you don't go along with what you want to do.
41:36Of course, Stanley Friedman is not a racketeer and Congress never intended the RICO statute to apply to this kind of conduct.
41:44I think almost all lawyers in this country now agree that the racketeering influence and corrupt organization statute has accordion like been extended and expanded to fit the government's needs.
41:55You know, so many corporations have been declared to be racketeers. Decent businessmen have been declared to be racketeers.
42:04I don't want to libel anybody on the air, but I could give you a list of people who have been charged with RICO both civilly and criminally.
42:12That would sound like a Hall of Fame or a list of Nobel Prize winners.
42:16RICO is just out of control today.
42:18It would have been unthinkable for me not to use the racketeering statute given the facts and circumstances, the egregious bribery of these four defendants in this situation.
42:29A very appropriate question could be asked. Why am I not using an appropriate weapon given to me by the United States Congress to deal with this reprehensible ongoing criminal activity?
42:39I know the defense lawyers make a lot of noise about this. That's what they get paid to do.
42:45But in fact, had I not done it, I think very appropriate questions could have been asked by the Congress as to why is it that the United States government isn't using the statute passed by Congress to deal specifically with this kind of corruption.
42:57The trial of Stanley Friedman and his co-defendants began on September 22, 1986.
43:03It was moved to New Haven, Connecticut because the defense contended that a jury in New York could not be impartial given the extraordinary amount of pretrial publicity.
43:13I don't know how long it's going to be. The government's got a couple of corrupt witnesses that are going to testify and then maybe we can all go home.
43:20Do you feel confident? Yes, absolutely.
43:22What did you say originally, Stanley? You were talking about batting practice?
43:28Yeah. Up to now, Gabe, the government has been taking batting practice. Now at least we get our turn at bat. We'll be in there pitching, we'll be in there hitting, and I'm sure that we'll be victorious.
43:37How are you?
43:38How are you doing?
43:39Hey.
43:40Be careful.
43:41Walk a little slow, will you?
43:42All right.
43:43Okay.
43:44Tell us how you feel today, Bob.
43:46Very nice morning.
43:47It was terrific. Great weather.
43:48Do you feel confident?
43:49Oh, sure.
43:50Absolutely.
43:51I decided that it was an important case.
43:52It's one...
43:53Giuliani's case against Stanley Friedman and the others was largely built upon the testimony of a series of government witnesses who were admitted accomplices in the corruption at the PVB.
44:03Geoffrey Lindenauer was the star witness for the prosecution.
44:10Lindenauer's cooperation agreement, under which he expected a reduced sentence, gave him a powerful incentive to help the government convict the others.
44:19The defense contended that it also gave him a powerful incentive to lie.
44:26I've met Geoffrey Lindenauer a hundred times, and I've never met Mr. Geoffrey Lindenauer.
44:31He is typical government witness in this case.
44:35The worst of the worst, who then come forward and make the case against marginal others.
44:44Then, like born-again religious fanatics, they are taken in by the church government into their bosom.
44:51The government says, yes, he was terrible, but then he found us.
44:55He found religion.
44:57And every word he uttered thereafter was God's truth.
45:01I mean, you hear it every day.
45:03You hear it with drug dealers.
45:05You hear it with corrupt politicians.
45:07You hear it with murderers.
45:09You hear it with mafia people.
45:11You hear it with everybody.
45:12It's the same story.
45:14The lyrics change a little bit.
45:16The tune's exactly the same.
45:18And the juries fall for it.
45:20Hook, line and sinker.
45:22Because they want to believe in redemption.
45:24And here's a redeemed man in front of them with the government standing behind them.
45:29It's a charade.
45:30It's a force.
45:31The jury was not swayed by the attacks on the credibility of Lindenauer and the other government witnesses.
45:37For eight weeks, they listened to testimony about a shadowy world where parcels of cash were exchanged in bathrooms.
45:44Where politicians schemed for kickbacks from unscrupulous businessmen.
45:48Where a piece of every new contract was secretly diverted into the pockets of corrupt officials.
45:54We used to joke about this case being an old-fashioned trial.
45:57The kind of trial that was done before Abscam.
46:00Before you had the secret video camera.
46:03It was done on the basis of testimony.
46:06That's the way cases always used to be tried.
46:08Before the electronic revolution.
46:11And that's the way we tried the case.
46:13We presented the entire case.
46:15They had Jeffrey Lindenauer, who was a man whose past was brought up for four days or five days on cross-examination.
46:24And they went over it, over it, and over it, and over it.
46:27Many things that he did in his life that he's not proud of.
46:30That no one could be proud of.
46:32That make him look horrible to a jury.
46:34The jury accepted the essence of his testimony.
46:37By the same token, the jury was able to assess the credibility of Stanley Friedman.
46:41Stanley Friedman took the stand in this case.
46:43Stanley Friedman directly contradicted the testimony of Jeffrey Lindenauer.
46:48The jury had a very sharp contrast.
46:51Stanley Friedman was a person who didn't have the sordid past that Jeffrey Lindenauer had.
46:56The jury believed Lindenauer and didn't believe Friedman.
46:58The jury made its decision.
47:01Well, this verdict is a very significant victory for the honest and decent citizens of New York City
47:05who have had to labor under the yoke of people like Stanley Friedman for too darn law.
47:09Barbara.
47:10Crooked politicians and crooked bosses of political organizations that are running counties that are in dire need of honest, decent people running those counties,
47:19who are raping those counties for their own advantage.
47:22Coming eight months after the death of Donald Maness, the conviction of Stanley Friedman completed the destruction of the two most powerful Democratic Party bosses in New York City.
47:32In return, the fight is out of you when they close the box, and I have no intention of quitting.
47:39At the core, Stanley Friedman and Donald Maness were essentially the same kind of people.
47:44And I thought the facts in our case indicated above and beyond the facts of just clear involvement in crimes,
47:49but the overall facts in the case indicated that Stanley Friedman and Donald Maness proceeded from the same general assumption about public office,
47:58which is that you're in it primarily to make hundreds of thousands and millions of dollars.
48:03And they were both quite proud of the fact that they could cash in on making, they could cash in on their political power and public power.
48:12I think when you have that mentality over a long period of time, 10, 15, 20 years of ascending in city government and becoming more and more powerful,
48:20it becomes very easy then for you to rationalize stepping over the line.
48:24And where a good opportunity for bribery comes along and you can make millions from the bribe, you do it.
48:31And I think that is essentially, at least in a public way, the story of Maness and Friedman.
48:37We can overcomplicate these things and romanticize these people beyond what they're really worthy of.
48:44In essence, these are people who cashed in on their public office.
48:47That's what they were seeking. They're seeking money, as much money as they get their hands on.
48:51There is a sentiment among politicians that they're underappreciated and underpaid.
48:56And they're making great sacrifices for us by working hard for the party and for the benefit of what they consider city government or state government.
49:05And therefore, they're entitled to certain rewards, which we might consider unethical, but they consider part of the system.
49:12What's wrong with giving a job to a relative? What's wrong with getting a contract for a friend?
49:17What's wrong with, after being a regulator, you go to work for the agency or the company that you regulated?
49:24They see this as part of their rewards for not going out into the free market and becoming millionaires.
49:30Therefore, they think they're entitled to it, for the long hours and the hard work and being underpaid, even if they are overprivileged.
49:37So they don't consider it that, they don't consider it that venal.
49:43When you are a politician and you've been around for a long time and you're re-elected time after time with an overwhelming percentage of the vote,
49:52when you run a county organization that is peopled with minions who are willing to do your bidding
49:58and who live in large part to support the organization and support the county leader,
50:04that that provides for a person a tremendous sense of ego, a tremendous sense of standing above it all,
50:11and a tremendous sense of believing that you cannot get caught and that you're really larger than life.
50:17And I think that that is something that poisoned Donald Manus, I think it poisoned Stanley Friedman.
50:23I don't believe that these men ever believed that they could be caught,
50:29and I believe they thought they were powerful and important enough so that no one would find out.
50:34They were operating in a world where it was just accepted, they were going to do this.
50:39It was part of their, kind of their, their mindset that it was okay to go around and do this stuff, this is alright.
50:45In a lot of ways, when I, when I've thought back on it, I've kind of compared their mindset to, to guys in, in organized crime.
50:53Not the violence, but this, this idea that thievery is okay.
50:57And that I think is really at the heart of this thing, that it's kind of greed times two.
51:04There's something else there that, that has kind of infected a lot of things.
51:08And I don't know how you get at, at rooting that out.
51:12It's easy to put somebody in jail, but how you change how people approach their jobs and their mindset toward money, and their mindset toward corrupt practices.
51:21And we said from day one we were going to appeal because we were wrongfully convicted.
51:27Stanley Friedman was sentenced to 12 years in prison.
51:31He is appealing his conviction.
51:33He declined to be interviewed for this program.
51:36Do you still maintain your innocence, Mr. Friedman?
51:38Well, I think that you heard me in the courtroom indicate that I say it here, I said it before, is that we have committed no wrongdoing and we will have, make every effort to upset the conviction.
51:52Stanley Friedman.
51:53Stanley Friedman did something that I think he really didn't, to this day, accept as corrupt.
52:02And it is absolutely corrupt.
52:04I believe that he believes that he simply used the system.
52:09I don't think that that's true at all.
52:13He corrupted the system.
52:16I believe that his sense of morality, if it ever existed, was lost years ago simply as a result of the authority he was given in prior administrations and greed, simple greed.
52:35I believe that in this country, regrettably, there has been a reduction in values.
52:41Money plays much too large a role in the lives of people in this country and whether we have forgotten how to deal with elevating people in their life styles, private life, public life.
53:04I think we have, regrettably.
53:07I think we're not focusing on it enough in terms of uplifting people.
53:13The revelation that officials as powerful as Donald Maness and Stanley Friedman were corrupt has shaken public confidence in New York City government.
53:23The scandal has spawned a raft of other investigations.
53:28During 1986 and 1987, the commissioners of hospitals, taxis, transportation, cultural affairs, business development, two members of the city planning commission, a borough president, and a United States congressman all resigned or were under indictment.
53:46There has been no citywide election in New York since the corruption scandal began.
53:52It remains to be seen whether the people of New York will demand higher standards from their political leaders or whether cynicism about politicians will continue to nourish the politics of greed.
54:04The burden for preventing corruption does not rest with prosecutors or the press.
54:11The burden rests with the public, and it is the public, not politicians, who will ultimately be tested by this scandal.
54:23There are many theories and explanations for what happened in New York, a loss of values, an overemphasis on money, an excess of pride.
54:34But there are those who say there may also be something in the very nature of our cities which makes it easier for corruption to thrive.
54:42Cities lack the sense of community, connectedness that exists in small towns.
54:49In their scale and density, cities can foster an emphasis on self, self-interest, self-centeredness.
54:57And as centers of power, cities attract so many who are out to make it, driven to succeed, sometimes at any cost.
55:07That lost sense of community and caring about each other may, in the end, be a basis for so much that went wrong in New York.
55:17This brings to an end another front-line season, our fifth.
55:21We hope that in the stories we've brought you this year, we've offered a sense of our community, of shared ideas,
55:28seeing different perspectives, possibilities, and the choices we face in our larger world as citizens.
55:37We'll be back in the fall with a special five-part series on South Africa,
55:41and then we'll return for our regular season in January.
55:45Thank you for joining us.
55:47I'm Judy Woodruff for Frontline.
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