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December 23rd, 2008

HAMPTONS POLITICS: A DOSE OF REALITY.

by D. Clark MacPherson


Henry Paulson: A good man to know if you happen to own a bank.

When a stupid man is doing something he is ashamed of, he always declares that it is his duty.
— George Bernard Shaw

We hang the petty thieves and appoint the great ones to public office.
— Aesop

As the Hamptons economy burns, the Southampton Town Board fiddles, the real estate industry implodes, Suffolk County D.A., Tom Spota arrests people. It’s not bad enough that Henry Paulson is saving his buddies at Goldman Sachs, JPMorgan Chase and Morgan Stanley—by dishing out billions from under the TARP to cover them for the losses that they created by handing out mortgages to anyone breathing—now Spota’s Economic Crimes unit is busy trying to criminalize the people who accepted the largesse. The bogus paper known facetiously as CDO’s and SVI’s—debts that were bundled into securities by thirty year olds pulling down $5 million dollar a year bonuses at Merrill Lynch, Goldman Sachs, Morgan Stanley, Lehman Brothers and Bear Sterns. One thirty year old from Merrill Lynch recently commented that he left the company with $20 million in cash and his only heartburn comes from trying to figure out how not to pay taxes on it.

You think he has a mortgage to worry about?

So Spota, seeing an opportunity to show what a tough guy and a great politician he is, along with his envious Detectives on a paycheck and all they can arrange under the table who try to “make” cases by threatening people — went into action against the poor schmucks that Wall Street people targeted. Mortgage holders and real estate owners have always been the preferred targets of police. They try to pay their bills and they are law-abiding middle class citizens and investors – who in this case were conned into being part of the biggest Ponzi scheme in history – not Madoff’s – but the securitized mortgages scheme by Wall Street that generated billions in fees to everyone in on the scam even before the ink was dry on the bonds and notes. The middle-class homeowners who took the loans and bought the property that greased the economy are easy to intimidate and convictions are a snap. There is zero risk for cops. No drug dealers or hold-up threats here.

There was no way that the escalation of financing by Wall Street forced upon a greedy society (like the Town of Southampton where the party is now over) which pushed banks, mortgage brokers and real estate agents to push loans — ever expected, or cared, whether the bill would ever be paid. That was never part of the equation. That never mattered to the kids pulling down $5, 10, or $20 mil per year. There were so many tricks in the fine print that Wall Street’s yuppies and CEO’s knew to take their fees first and move on before the shit hit the fan. That was part of the plan and when they finally acknowledged the Ponzi scheme that THEY had created, they were out the door and long gone. Of course, Paulson then had to bail them all out.

What is happening now in Suffolk County is the age old 90% -plus conviction rate game – the D.A.’s ploy to hold on to his job – boasting high conviction rates by picking on people who do not have the resources to defend themselves against bogus criminal charges. They know better than to go after the Bear Sterns executives because any laws actually broken (if there were any) were beyond the D.A.’s ability to prosecute. Better to go after middle class people who were the real victims in all of this – by virtue of Wall Street’s greed, mortgage broker’s greed and the greed of Towns and Villages with bloated economies and police forces pulling down a few hundred thousand a year.

Even local corruption, like the Masterson Southampton Town Highway department con game of collecting cash from pavers for contracts for the Republican Party, is ignored. That’s a political accommodation. Then, there are the local law firms (with partners in Town government) who have been illegally steering business to themselves and off-budgeting any hard legal work to outside legal firms at $500 per hour, while getting a kickback. That too, is ignored by the D.A.

Spota is a Republican despite the Democratic moniker. And, the D.A. recently cut a deal for himself after it became clear that his continued prosecution of Marty Tankleff (who was railroaded into prison for 17 years by one of Spota’s clients, a dirty cop) was a tad too over the top. He subsequently appointed a Special Prosecutor so he could go out the back door, who, lo and behold, dropped the entire matter against Tankleff. Showmanship is part of law enforcement and the media is “malleable” in Suffolk. Aside from Tankleff’s release, some really positive results arose from the birth of such organizations such as the Fortress Innocence Project—a world class investigations agency that assists wrongly imprisoned individuals.

Jay Salpeter, who worked hard to help Tankleff, is among its highly qualified staff.

In truth, Spota is better than Catterson, a D.A. who was a retaliative dimwit that practically ran a bag man operation out of his Suffolk County bar — and who routinely got drunk with another recently departed bully, Dave Wilmot, the publisher of a now defunct comic book known as Suffolk Life. “News” was routinely leaked to Suffolk Life by the likes of Town Attorney Joe Lombardo when a character assassination job was needed on any targets who actually believed in the Constitution. Lombardo, known as a legal errand-boy for Heaney and the Republicans was given the job of executing Southampton Town’s anti-Latino racial bias and its concomitant landlord policy directed against New Yorkers—and has been sued in Federal Court in part for his complicity.

Town Attorneys Joe Lombardo and Michael Sendlenski both operate a plea bargain program for the Town, ostensibly directed at code violations, in order to bring in fines while intimidating New Yorkers – who pay for the entire economy. While Town officials and friends of the police never see a visit from the Code Enforcement clowns, anyone who criticizes the Justice Court, Town Attorneys or Police are regular targets. Unfortunately, due to this corrupt system, many people have been forced to give up their property rights while a rumored “payoffs for constitutional rights” operation continues. Investigators have uncovered widespread abuse of the legal system where nearly 90% of the housing in the Town is substandard or below State codes yet, is ignored or tolerated. Code Enforcement is only used for targeting, not safety.

All of this is essential to the Southampton Town Attorney’s office operation which has followed Skip Heaney’s announced agenda against New Yorkers — of prosecuting landlords and the taking of their property if they rent to people who are on their racist hit list (illegal immigrants, blacks, or Latinos). While there is often no illegality found as a result of the expensive searches, seizures, fines and plea deals — coping with the cost for justice in a prosecutorial environment can be daunting, if not impossible. Silencing objectors, of course, is the point.

As Sol Wachtler once said, most prosecutors can get a Grand Jury to indict “a ham sandwich.”

Justice is ephemeral and in Suffolk County it’s based upon who you know, not whether you did anything wrong. A.D.A’s and Detectives in Suffolk County routinely threaten people on and off the job because they know that they can ruin a person’s life with any criminal charge that causes large legal fees and fear, despite their dubious legitimacy. And, as criminal attorneys will attest: those who lie the most on the witness stand with impunity—are police and prosecutors. Many judges are blind to the game—until you get into Federal Court.

Recently, for example, scores of people were arrested for having unwittingly forgotten to advise the tax collector in Suffolk County that they are no longer qualified for STAR exemptions – and were arrested by the D.A.s office for something that is simply not a crime. It is a completely civil matter. There is no criminal penalty for the oversight – even if it was intentional. Old ladies, black people, working mothers and laborers were dragged in to court by Suffolk County D.A. Detectives. Everyone pleaded guilty, of course. They did not have the money or legal counsel to withstand the pressure. But, every aspect of it smells of intimidation.

Of course, you tell that to the high school grads at your door with badges and guns drawn. You don’t pick a fight with someone holding all of the cards. And, there’s the rub. Justice is expensive and risky. Suffolk County juries are not known for their legal knowledge. They are hand-picked by corrupt A.D.A’s looking for a raise or notoriety.

In Manhattan, the D.A. goes after criminals. Bob Morgenthau may not be a saint, but he’s alert, awake, and has a real sense of justice – in spite of his age and long experience. His top prosecutor, Dan Kastleman is as tough as they come, but does not prosecute people as a political favor to informers, police, or politicians. Not so in Suffolk County.

Police routinely move from on duty, to home security company, to informer. They may not have any balls left but they still have the urge to be relevant and feign importance – even when they step over the line. Until they are caught.

The Hamptons are known for its Police State mentality and the concept of retaliation for not going along with the program is acknowledged widely – so that the Town Attorneys, current and former Police officers, current and retired Supervisors or Town officials, Code Enforcement personnel – all have a vested interest in being informers and inciters to augment the Republicans — the symbols of which are described by Seth MacFarlane as “an elephant, and a big fat white guy who is threatened by change.”

Recently, in fact, where no criminal actions existed, in an environment of retaliation, D.A. detectives have been hiring out their services and doing personal favors both on and off duty — to feed this illegal operation of acting to further personal vendettas using their badges. They know that this is an effective way to conduct what the NKVD perpetrated in the Soviet Union during the 1930’s. It was called “The Terror.” Rather than support of their efforts in the service of Justice, honesty and diligence, the D.A. and his Detectives would prefer to be feared rather than respected by the public. That was true of Stalin and Machievelli as well.

As the economy sinks further into the muck and mire—verging on a full-blown Depression by the year 2011—more illegality will be uncovered. But, it won’t be due to people like the couple in East Quogue who were accused of supplying incorrect information in order to obtain a mortgage. It will be due to Hedge Funds who won’t (or cannot) return money to investors, financial institutions who cooked up securitized debt obligations and who knowingly sold off trillions of dollars of phony securitized mortgages to make commissions and signaled to everyone in the real estate market that they needed more and more product to feed their insatiable need for commissions, salaries and bonuses. The mortgage banks like American Home or American Brokers Conduit, as in the case of the East Quogue matter, were encouraged to package loans however they could so the loans could be passed off. So, where are the Wall Street boys in this so-called investigation? Oops, probably couldn’t get them to lie down on that end of the “investigation.”

Counties, Towns, Villages and even States may be headed for bankruptcy.

And, this is a ship of state that few realize is in much deeper trouble than anyone yet realizes. With the probability that another 4 million will be unemployed this coming year; with the probability that the foreclosure numbers will INCREASE over the next two years; and, with the reality that this economic pain is a worldwide reality for several years going forward – expect the Justice system to founder and collapse along with the Bankruptcy system, as it seeks answers while attempting to punish innocent victims in its bewilderment.

What we have to do is take the power away from the abusers in our society.

In the Town of Southampton, we must succeed in obtaining the right to vote so that Justice is a reality.

For more Hamptons Politics, click here.

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