But this was not a query about lunch, according to indictments unsealed Tuesday in state Supreme Court. The papers described a wide-ranging scheme involving three companies to steal at least $15 million from Bloomberg L.P., the giant financial information and media company, through bribes, kickbacks and bid rigging.
Among the conspirators, “sandwich” was code for bribes or kickbacks, prosecutors said. The contractor wanted to know if the executive, Vito Nigro of Turner Construction, was satisfied with the thick envelope stuffed with cash that had been delivered to his office the prior day, according to the indictment.
Nigro and the contractor were among the 14 people charged with grand larceny, bribetaking, bid rigging, money laundering and falsifying business records relating to work at Bloomberg offices at 120 Park Ave. and 919 Third Ave. The defendants all pleaded not guilty in state Supreme Court in Manhattan and were released on bail. Three companies were also charged in the scheme and pleaded not guilty.
The indictments Tuesday came after a two-year investigation by the Manhattan district attorney’s office and the State Police.
Prosecutors said contractors coveted work for Bloomberg because the company “pays extremely well and it pays on time.”
Executives at Bloomberg and Turner Construction routinely steered contracts to favored electrical contractors, vendors and others in exchange for cash, favors, or work on their homes, the indictments said. The executives and contractors in turn inflated the cost of their work for Bloomberg by millions of dollars.
The executives were fired in October 2017 as investigators seized records and computers at their offices.
The Manhattan district attorney, Cyrus R. Vance, described it as a “brazen” scheme that was nonetheless successful over the course of a decade. His office has repeatedly prosecuted companies for similar schemes, which he contends contribute to “New York’s sky-high construction costs.”
“This is a major cost for businesses and taxpayers,” Vance said in an interview. “Hopefully, this will spur corporations to invest in prevention strategies, auditing.”
Prosecutors said that more than a dozen individuals and companies had already entered guilty pleas in connection with the conspiracy and paid about $5.5 million in restitution. Some of those contractors are cooperating with investigators and providing evidence against the people arrested Tuesday.
At the arraignment, Assistant District Attorney Christopher Beard described Anthony Guzzone, Bloomberg L.P.'s former global head of construction, as the “capstone on this pyramid of corruption.”
Guzzone reaped not only millions of dollars in cash kickbacks, prosecutors said, but contractors also did work to convert his New Jersey home to a “palace,” installing iron gates and a custom-designed outdoor barbecue, among other things.
Alex Spiro, Guzzone’s lawyer, challenged the prosecutors’ case, suggesting the “bare bones” indictment was light on evidence of Guzzone’s alleged wrongdoing, aside from references to lunch meetings and a custom bar.
From almost the day Bloomberg recruited Guzzone more than 15 years ago, prosecutors said, he was looking to enrich himself by stealing from the company. At first, Guzzone was responsible for maintenance contracts at Bloomberg offices, including its headquarters, and he demanded kickbacks in exchange for steering work to vendors, prosecutors said.
But when he was promoted to global head of construction, prosecutors said, Guzzone expanded the fraud, colluding with Ronald Olson and Nigro, executives at Turner Construction, as well as contractors and vendors.
The scheme went undetected for years, prosecutors said, because the people with oversight responsibility to guard against criminal activity — Guzzone at Bloomberg and Olson and Nigro at Turner — were in on it.
Prosecutors said that Guzzone even came up with the idea in 2008 of creating an electrical contractor, Litespeed Electric, to obtain some of the work. Guzzone was a silent partner in Litespeed, which was formed with executives from Bloomberg’s former electrical contractor, including Robert Fleming, who was indicted Tuesday along with his wife, Donna Fleming, and three colleagues.
According to the indictment, Litespeed padded its bills. By 2017, when the scheme collapsed, Litespeed had gotten roughly $250 million in contracts for Bloomberg offices.
At the same time, Guzzone and Robert Fleming named Donna Fleming as a no-show company president so Litespeed could compete for contracts as a woman-owned company.
The company’s lawyer, Mark Agnifilo, said, “Litespeed categorically denies that it stole a dime from Bloomberg.”
Investigators say the investigation is continuing.
This article originally appeared in The New York Times.