Pennsylvania Turnpike corruption alleged in federal indictment of senator, wife of Pike chairman
By Peter Samuel
Vincent Fumo in AP pic
Turnpike chairman's wife is charged second after Fumo
Fumo's country retreat where $220k of Turnpike money went in phony contract
Indictment notes phony Turnpike contract was issued on behalf of Fumo just two months after Mitchell Rubin became chairman
Joseph Brimmeier, a Pittsburgh pol, took charge as exec director of the Turnpike at the same time gambling magnate Rubin became chairman
Vincent Fumo as presented on his Senate website - picture when he was 20 years younger
Ruth Arnao (aka Ruth Rubin) at check giving ceremony of fraudulent Citizens Alliance
Fumo who was chair of the Democratic Appropriations Committee stood down from the position Feb 5, was arrested and charged by the feds Feb 6 and is free on bail of $100k after pleading not guilty. The Turnpike chairman's wife Ruth Arnao/Rubin is charged as a conspirator along with Fumo and two senate aides.
The federal indictment in US District Court for the Eastern District of Pennsylvania filed Feb 6 2007 (Criminal Case 06-319) is United States v. Vincent J. Fumo, Ruth Arnao/Rubin and two others and involves 101 counts of fraud, 32 counts of obstruction of justice, multiple counts of tax evasion and conspiracy.
Ruth Arnao/Rubin is described in the grand jury indictment as the girlfriend and later wife of the current chairman of the Turnpike Commission, Mitchell Rubin.
The corrupt Turnpike contract with the unnamed man (identified elsewhere as Michael Palermo) working on Fumo's property is described as having been signed two months after Mitchell Rubin became chairman of the Turnpike at which time Joseph Brimmeier, a Pittsburgh politician also became executive director.
Rubin's connections kept quiet
Rubin keeps a low profile. Google searches show him described as a "heavy hitter" in the Democratic Party in Philadelphia but the search engine produces nothing more about him. The Turnpike's official announcement of Rubin's appointment as chairman on Feb 4 2003 is extraordinarily terse for an announcement of a new chairman just calling him "Mitchell Rubin of Philadelphia." He had been a member of the commission since 1998, it added. Not a word on his occupation, education, former jobs.
The Turnpike still does not provide any biography on its chairman as if there is something embarrassing there. There is!
The Turnpike chairman is big in the gambling industry it turns out. Mitchell Rubin is described as "an investor in a gaming company" by none other than the indicted Senator Vincent Fumo in a letter of August 2 2006 on his website (see http://www.fumo.com/Press_Releases/OrieGamingLTR8-2-06.htm). The letter addressed to Sen Jane Orie reads:
"You (Orie) have also gone so far as to attempt to attack the character of Pennsylvania Turnpike Commission Chairman Mitchell Rubin. Please know that Chairman Rubin has never been accused of wrongdoing and has an impeccable reputation as a public official. In fact, he has repeatedly received the support from your caucus as Chairman of the Turnpike Commission. He is an investor in a gaming company. I am not. I neither control nor direct Chairman Rubin's personal investments. I am not aware of anyone who has suggested that he has used his office to gain improper influence. Furthermore, contrary to your statement, Rubin's wife has not worked in my office in over 2 years."
Rubin's wife Ruth Arnao (described as aka Ruth Rubin) is indicted along with Senator Fumo and two others in the 101 counts of fraud, 32 counts of obstruction of justice, multiple counts of tax evasion and conspiracy filed by the feds Feb 6.
Turnpike chairman's wife
Ruth Arnao/Rubin is described as having worked in Fumo's South Philadelphia office and as also being executive director of a not-for-profit of Citizens Alliance for Better Neighborhoods (CABN) and secretary treasurer of CA Holdings, a for-profit spin-off involved in real estate investments.
Philadelphia newspapers carried long articles alleging wrongdoing by the CABN and associated for-profit spinoffs back in 2003, articles which appear to have sparkd the federal investigation that culminated in the recent indictment.
Fumo has multi-million annual income but favors spending OPM
Fumo is described in the indictment as controlling a staff of 90 on the Senate payroll, most in Harrisburg. Fumo was chairman of the Senate Democratic Appropriations Committee. His main office and house is in Philadelphia. A very rich man, Fumo is the largest shareholder in a family bank he inherited, and receives $1 million a year from a law firm. He owns four houses, one described as a 33-room mansion in the rich Spring Garden area Philadelphia, an oceanfront house at Margate on the Jersey shore, a multi-million dollar oceanfront house in Jupiter Beach FL and large amounts of condos and rental property. (ADDITION: Fumo sold his share in PSB Bankcorp recently for $18m plus a $6m golden parachute.)
The indictment says that despite his personal wealth Fumo boasted that he believed in "spending OPM" for Other People's Money.
The federal indictment charges Fumo "regularly endeavored to gain personal benefits and gratuities from others, including entities over which he had influence" and lists the state senate, the Citizens Alliance for Better Neighborhoods, and a Seaport Museum as among those the senator bilked.
Senator Fumo is charged with having "systematically, routinely and improperly used the funds and resources of the Senate for his personal and political benefit" having directed senate employees and contractors to "serve him in any manner he desired, throughout the regular workday and at all hours of day and night, to further his political goals and attend to his personal wants." (p3 #4)
Fumo is described as padding his payroll with superfluous staff including friends put on the senate payroll who performed little or no legitimate senate work. He "used numerous senate employees to attend to his many personal needs." Staff on the senate payroll acted as his housekeeper, his cleaners, kept his personal accounts, managed refurbishment of his houses, ran personal errands, looked after him on vacations, and drove him everywhere.
Fumo gave senate equipment including laptop computers to friends, family members and girlfriends, the indictment states.
Fumo had senate contractor spy on ex-wife & girlfriend
The senator directed the issuance of a senate contract of $40k to a private investigator who he had conduct surveillance on his former wife and girlfriends, reporting to him at senate expense on their liaisons.
The private investigator was told to follow an ex-girlfriend of Fumo watching for indications of drunk driving under instructions to call the police and get her charged. Fumo instructed the senate paid investigator to harrass her new boyfriend, including getting his drivers license revoked.
Fumo also used private investigators hired on senate contracts to gather dirt on political rivals, the indictment giving detailed examples of this.
Turnpike chairman's wife paid $95k/yr by Fumo
Ruth Arnao/Rubin was on the state payroll in Fumo's office for many years but retired at the end of September 2004 when she was on a $95k senate salary, the indictment says. She is described (p10 #16) as having done "little work for the senate and instead occupied her time during regular business hours as the treasurer of Fumo's campaign committee Fumo for Senate, as the executive director of Citizens Alliance, and in organizing Fumo's personal affairs." Arnao is described as having had assistants also on the senate payroll who also did nothing for the senate but worked on Fumo's personal and political business. The indictment cites a memo of their duties.
The Fumo farm that the Turnpike gave $220k
The Fumo "farm" is described as 100 acres in Halifax PA near Harrisburg and appears to be where the senator stays when in the state capital. Halifax is on the west bank of the Susquehanna River in a picturesque spot about 25km (16mi) north of the state capitol. It can be seen just across the river driving on US15, the most direct route between Washington DC and upstate New York and Toronto Canada. There are beautiful views of the wide river, its cliffs and its rapids. Halifax is on a curve in the river providing great views north and south. It is close by the Lake Tobias Wildlife Park.
Fumo bought the Halifax farm early 2003 for $515k. The indictments quotes emails from Fumo to senate staffers who he got to develop the farm property for horses. Some were doing it fulltime.
Turnpike "contractor" an "old friend of Fumo"
Michael Palermo described as Senate Contractor #4 (SC#4) is described as an old friend of Fumo, as living in Hummelstown (just east of Harrisburg), and, coincidentally, the small town where TransCore has its national headquarters.
Fumo is said to have sometimes stayed at Palermo's house. Palermo had senate contracts worth $45k to $60k/yr from 1999 to 2003 purportedly to provide consulting services on "intrastate transportation issues." The indictment says (p41 #79) the senate has "no documentation regarding any work" that Palermo did, no notes, or reports. After the federal investigation got under way the contract of SC#4 with the senate was terminated. Palermo was working almost exclusively on Fumo's farm at Fumo's direction, the indictment states (p42). It cites emails.
In April 2003 two months after Rubin (and Brimmeier) gained control of the Turnpike Palermo started getting $10k/month from the Pennsylvania Turnpike, the indictment states (p43 #83).
"...at the same time that he began to take an active role at the farm, (SC#4) also received beginning in April 2003, a $10,000 a month check from the Pennsylvania Turnpike Commission (PTC) as part of a lucrative consulting contract. This contract was awarded to (SC#4) by the PTC within two months after (SC#5), a member of Fumo's inner circle of friends and the boyfriend (later husband) of Ruth Arnao was elected chairman of the PTC. Despite total payments of $220,000 to (SC#4) between April 2003 and December 2004 the Pennsylvania Turnpike Commission has no records reflecting that any work was ever performed by (SC#4) on that contract either." (p43 #83)
Here Mitchell Rubin chairman of the Turnpike Commission is identified as SC#5!
Watch this space. This story has legs...
Now we see why the Governor dumped the Brimmeier plan - COMMENT
Now we see why Governor Ed Rendell brushed aside Joseph Brimmeier's plans for keeping control of the Turnpike in favor of a private concession. The governor knew some of the present crew at the Turnpike were likely headed soon to a federal courtroom and likely then a federal penitentiary.
TOLLROADSnews 2007-02-07 SMALL REVISIONS 2007-02-10