Updated news on the Gambino, Genovese, Bonanno, Lucchese and Colombo Organized Crime Families of New York City.

Sunday, May 13, 2018

Mafia tied contractor awarded over $30M in NYC contracts

A contractor whose former company was suspected of mob ties won $37 million in taxpayer-funded city contracts last year — despite his history of blocking investigations into his prior company.

Richard Persico owns PCI Industries, a Mount Vernon firm that won three huge city contracts in 2017 to resurface New York City streets and install wheelchair-accessible sidewalk ramps in all five boroughs.

He got the lucrative deals even though city investigators say in 2006 he blocked their efforts to look into mob involvement in an affiliated firm he co-owned 50/50 with his brother, Robert.

At the time, Robert Persico had been arrested on racketeering charges and identified by the FBI as an associate of the Gambino crime family. He was facing several federal charges, including paying off a corrupt official of a union representing employees of the brothers' company, Persico Contracting & Trucking.

Last year the city awarded PCI Industries three contracts: $24.1 million from the Department of Transportation and two more totaling $12.9 million from the Department of Design & Construction.

Officials at both Transportation and Design conceded that that they only learned of the obstruction findings on Persico when contacted by The News. Officials later said the finding had been automatically deleted in 2011 from the city's contract database known as Vendex.

In response to The News' findings, Councilman Ritchie Torres, (D-Bronx), says he'll propose legislation this week to "close the loophole in Vendex and require longer retention of information that could inform the city's determination of who qualifies as a responsible

He also chastised the city for striking the deal with Persico.

"The city's decision to hand a $37 million check to a contractor with ties to organized crime represents a colossal waste of taxpayer dollars," Torres said.

On March 2, 2005, Robert Persico was charged along with several alleged Mafia members with extorting a rival construction firm and trafficking in stolen luxury goods, including BMWs and Cadillacs. A week later he was charged separately with bribing union officials on behalf of Persico Contracting, the company the brothers co-owned.

Persico is led away in cuffs in 2005. His company just got millions in city paving contracts.

At the time the company's license to operate a trade waste business was about to expire, and the city Business Integrity Commission soon after received an application for renewal.

Richard Persico promised to answer the integrity panel's questions and submitted paperwork claiming that Robert had ended his 50% ownership of Persico Contracting on March 1, 2005.

"Not coincidentally," Integrity investigators noted, "the date of Robert's purported resignation occurred the day before the indictment charging him with conspiring with a capo in the Gambino Organized Crime family was unsealed."

The Integrity commission soon determined the documents filed by Persico were misleading and that Robert was still a principal when the renewal application was filed: "Documents were backdated in order to avoid filing a renewal application that acknowledged that PCT was owned and operated by a principal under indictment for significant organized crime activity," the commission wrote.

Officials say Persico Contracting's lawyer then began delaying Richard Persico's scheduled deposition with the integrity commission. In the end, Richard Persico informed officials he would not answer their questions.

On June 20, 2006, the commission declared, "It is of grave concern . . . that (Persico Contracting) filed a misleading and contradictory application and obstructed the commission's investigation into the matter."

Persico Construction, the commission ruled, "may not operate as a trade waste business in the city of New York."

To get around this problem, Richard Persico created a new company at the same address with the same phone number and with the same equipment, according to records.

Two weeks after informing BIC he wouldn't cooperate in their probe, he incorporated PCI Industries, listing himself as sole owner.

City Councilman Ritchie Torres (D-Bronx) slammed the city's dealings with Persico as "a colossal waste of taxpayer dollars."

According to a 2011 lawsuit filed by a union representing some of the company's workers, "all or most of the property and equipment used by Persico Contracting is or was owned by PCI."

The lawsuit by the Highway Road & Street Construction Laborers Local 1010 charged that "PCI exists for the purpose of servicing Persico Contracting."

More recently PCI appears to have skated around multiple obstacles to obtain city contracts.

All contractors seeking city work must detail if the "vendor, any affiliate or any of their current or former principal owners officers or managerial employees (have) been convicted of a felony and/or any crime related to truthfulness and/or any crime related to business conduct in the past 10 years."

In PCI's case, they would have had to answer "yes" to this question until July 2016 — 10 years after Robert Persico's conviction on two federal charges.

But that question is not asked of subcontractors, so in 2014 and 2015 PCI was able to land $2.2 million in city work as a sub-contractor on two projects.

And in December 2016, five months after the 10-year restriction ended, PCI was able to answer "no" to this question when it bid on the first of three contracts with the city.

Richard Persico did not return calls for comment from The News.

Notified of the Persico contract awards, the city Department of Investigation said it's working with BIC and the mayor's office of contract services "regarding the timeframe of how long cautions, including BIC denials, remain" in the system.

Asked about the current protocol of erasing negative findings from the system used to vet vendors, Jane Meyer, a spokeswoman for Mayor de Blasio, said, "We will work with our partners in the controller's office and the Department of Investigation to review protocols that ensure responsible organizations are receiving contracts."



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