ten-net-logo.gif - 5895 Bytes

no-post.gif - 5505 Bytes

Click here to send mail to Spotty

public housing spotty gif - 1000 Bytes

Public Housing Spotlight

Issue Preface
Published on April 30, 1999

(Updated with 2 new ReaReal Audio files on February 23, 2000)

Click here to go on to Chapter 1

Click here to jump to Chapter 2

(Click Here for NYCHA "preliminary" Audit
by NYC Comptroller Alan Hevesi)

(Click Here for Directory of Issues)

public-housing-break.jpg - 985 Bytes

on Corruption

Curiouser and Curiouser!

"To know how to say what others only know how to think
is what makes men poets or sages;
and to dare to say what others only dare to think
makes men martyrs or reformers--or both."
Elizabeth Charles

(There are many decent folks working in
New York City's Public Housing Authority,
NYCHA, to whom those words can apply!)

To give readers a sense of the corruption we are trying to have investigated, I've converted a copy of one audio tape (of Contract Inspector Richard "Tony" DiAlto recalling some of his bribes) into the Real Audio format. HUD, the US Attorney General, the NY Attorney General and the Members of the NYC Council have all been made aware of this particular tape, other tapes not yet posted and the Public Housing Spotlight itself. Yet, not one of those august bodies has deemed NYCHA corruption to be worthy of their attentions.

If you don't already have the FREE Real Audio player, you'll need to fill out a form and download it..(click here).

I loaded two versions. The whole conversation (25 minute, < 3 Meg CLICK HERE), or, if you have a very slow connection (or attention span . . . ), a smaller (6 minute, <1 Meg CLICK HERE) file containing only the first 6 minutes of the conversation.

The background noise on the tape is a result of our being in Tony's car, in a rainstorm, and his wipers were going part of the time. During the first part of the tape, he's driving under an Expressway. By the last half, we're parked on a quiet street, so that's much clearer.

The dings come from the Freeware version of an audio editor I used to reduce the tape hiss. Unless you purchase the full package, it will ding every so often.

(On future tapes, which we will post, Tony "remembers" a lot more than he did on this initial go round. I don't believe he was being deceptive; I really believe that the extent and amount of bribery and other corruption was so great that Ol' Tony just needed more time to remember even most of it. But it was all to no avail, as the NYC Dept. of Investigation is more interested in containing scandals for City Hall than it is in seeing that corruption is held in check .

"You know, Jack. I'm beginning to think it
would have been better if I had stayed dirty."

The same Tony DiAlto said that to me after he and I had spent months working on a corruption investigation for the New York City Housing Authority (NYCHA) Inspector General's (IG) Office. (Clicking on the following link will bring up a Real-Audio clip of a portion of a conversation between John Kilpatrick-IG Investigator, and myself: JK.ram)

And I hate to admit it, but I am beginning to believe that Tony may have been right.

"Why?" you ask. Well, take it from me, reporting on corruption in this City will cause you nothing but anguish. In this upside down world of what appears to be a "Law and Order" Administration, the Department of Investigation appears to be in charge of insuring that crimes go unpunished. It's as if their neural synapses convert a command to prosecute felons into a command to persecute those who report the crimes.
(At one time, I thought that "military intelligence" was the most humorous example of an oxymoron. Now, after what we all went through, "DOI investigation" is my favorite.)

Let me tell you, if you report on a NYC Housing Authority employee who sneaks out for a cup of coffee at 8:30 AM, the IG/DOI will have a team in an "unmarked" van pulling surveillance on that coffee shop in a heartbeat. If you're a grounds keeper who they can catch carrying an empty NYCHA plastic garbage bag home, they'll have your ass so fast you won't know what hit you. On the other hand, give them information on large payoffs to a NYCHA executive from a NYCHA vendor-a vendor who does millions of dollars in business with NYCHA every year-and they will refuse to investigate that!

If you think I'm exaggerating read on and I'll prove that exact example. And if you'll spend the time necessary to read this long Spotlight on NYCHA Issue to it's finish, I guarantee that you will be convinced beyond a shadow of a doubt that something is seriously wrong with the people and agencies who should have been investigating NYCHA for these past 5 years. And please remember that the NYCHA IG's office is not an independent office. They are a part of the Department of Investigation. Mr. Pasichow, the NYCHA IG, is actually a DOI Executive officer.

(Before I go on, I want to highly recommend an excellent book for those of you who might believe that my charges regarding the NYC DOI are a bit far fetched. The book is

Secret Police
-Inside the New York City
Department of Investigation

It is written by Peter Benjaminson, who was the Executive Assistant to the Commissioner of DOI. It is published by Barricade Books and I know that it is carried in some branches of the NY Public Library. I recommend reading the entire book, which is a quick read at only 249 pages. However, if you're pressed for time, I'd ask that you read Chapter 26, titled

DOI as Lap Dog

It runs from pages 170 through page 181, and it will truly open your eyes to what has happened to this supposed investigative agency.)

Okay, I guess it's about time that we were introduced.

My name is John (Jack) Ballinger, and I'm the editor of this rag. And in this issue, I'm going to spend some time telling you how the Spotlight came into being. I'm going to start at the beginning (Duh!), and that means it will take some time before we get to Spotty's birth. As with some good suspense stories, it will start slow and pick up speed as you get further into it. I'm hoping that by the end, or even by the middle, you'll think that the time you spent was well worth it.

Many of the sentences will begin with "I" or "My", end with "me". I'm uncomfortable with that, but in this case I believe you'll see it was unavoidable. But please understand this, this story would not exist if it weren't for a growing group of decent, honest and courageous individuals who risked much in a stubborn battle against corruption, and in a battle against an even more insidious foe, apathy. Each of the dozen people who worked together on the corruption investigation covered in Chapter 2 has a story to tell. Nearly all suffered in tangible ways. Some suffered punitive transfers. Some were denied overdue and well-deserved promotions, while they watched those who were part of a corrupt crew receive promotions and act with impunity. Three of the "good guys" wound up quitting NYCHA.

Of course, the Public Housing Spotlight portion of the story goes way beyond the confines of the NYC Housing Authority's Contract Administration Department. The stories in the Spotlight came from a wide range of NYCHA workers. The real heroes of the Spotlight range in age from some in their early 20's through those in their 60's. Female and male; Black, Hispanic, Asian and White are all represented. Some work in NYCHA's Projects, while others toil at 250 Broadway. Each was fully aware that they were taking career risks, and some knew that they might be facing more serious threats.

In retrospect, I'd say that the only commonality was an unusual willingness to bang one's head against the wall for month after month while trying to get someone to believe an incredible story. For NYCHA was annually listed as the nation's best Public Housing Agency/Authority, at the same time that the HUD money tree was being picked on a near daily basis. A story of a large government entity that resembled a tale of two cities that would do Dickens proud.

We have the illusory New York City of the City Hall press conferences, where the crime rates are proudly displayed and where it sounds as if corruption would never be tolerated.

On the other hand, there is the real New York City. A city wherein officials holding Mayoral appointments are committing the crimes. Officials who are aided by those whom they appoint. A City where females working in the nations largest public housing authority/agency become victims of sexual harassment, and then face job related retaliation for having the audacity to report that harassment to the Office of Equal Opportunity. A City where nobody ever needs worry about arrest, as every allegation is shuffled off to some dead letter file called DOI.

A city where, if my perspicacity is functioning, the inept DOI will now claim that they have been actively investigating these charges and that by making my charges in public I have ruined their chances of getting successful prosecutions of those who committed crimes. And/or that I and anyone associated with this story are all just a group of disgruntled NYCHA employees spreading a false story about corruption in high places. To that I say, Bullshit!

It seems obvious what was going on at DOI. Obvious enough that this Corruption Issue will, I believe, force them to finally act. sadly, I don't believe you'll they will be looking into anyone who holds a high office at NYCHA. Public housing in New York City seems to be immune from any truly independent oversight. Only an outside independent agency could be trusted to do that. Read on and see what you think.


What the hell is a NYCHA?
And why should I care about
what happens in NYCHA-land?

Good question! Let me tell you why you should care, whether you live in Brooklyn, NY or Sioux City, SD.

(All figures used below were taken from the NYCHA web site, http://www.ci.nyc.ny.us/pub-hous/nycha/home.html , and were the latest available to me at the time of publication.)

The New York City Housing Authority (NYCHA) is the largest public housing authority in the United States. It owns and operates approximately 181,000 apartments in 346 developments throughout the five boroughs, providing public housing to over 600,000 low-income residents, including an estimated 150,000 doubled up persons. In addition, NYCHA administers a federal Section 8 housing program, providing rent subsidies for approximately 77,000 families living in apartments owned by 25,343 private owners.

NYCHA receives public housing revenues from two primary sources: the Federal Government (71 %) and resident rents, interest and other income (27%). The State of New York and City of New York make up the remainder.

Total revenues from all sources were approximately $2.5 billion in 1997. So, almost $2 BILLION of your federal tax dollars directly subsidize NYCHA, no matter where you live. If you live in New York State you also kick in some more cash. New York city residents get to dig for a few extra bucks on top of all the rest, in order that NYCHA can exist. (Of course, all that $ brings with it certain temptations. We will be looking at some of them, in detail!) Also, In July, 1995, NYCHA executed an agreement with HUD that allows 22,624 State and City aided units to receive $230 million in federal funding for much-needed modernization and capital improvements, including repairs needed to meet statutory requirements, emergency safety and security conditions, and to make repairs to the buildings' structures and systems, apartments, and grounds.

NYCHA's enabling statutes give the State of New York, through its Division of Housing and Community Renewal (DHCR), certain regulatory authority over NYCHA, however, the Mayor of New York City appoints all NYCHA Board Members. This tripartite structure (Federal, City and State) makes the governance of NYCHA particularly complex. (And that makes accountability a convenient exercise in round-robin finger pointing. Do you bring charges of official corruption and/or malfeasance to the US Attorney General, the NY Attorney General, HUD, the District Attorneys, City Hall, the City Council, the Public Advocate, NY Senate/Assembly or whom? Well, as you'll see, we contact just about everyone!

I hope you now see that we're talking BIG money here. And that money once belonged to you.

Let's see how they handle that small portion of it with which I was familiar.

The $50,000,000 in missing Security contracts that we'll discuss in depth in Chapter 1 was reported to the IG/DOI in November of 1995. That's almost 4 years ago! (I'm no lawyer, but I hope that DOI is aware of that old "Statute of Limitations" thing!!!) And, John Kilpatrick said that the investigation into those charges was finished in early 1996, and that DOI concluded that there was no case to be made!.

I reported on CAD Inspector corruption to the IG's office in January of 1997. During that same month, Tony DiAlto gave the IG/DOI testimony including Inspector's names and dates of payoffs. By May of that year, they had the incriminating tapes that Tony had made. Yet today, 2 years later, the only people who have been physically and/or financially hurt by this scandal are the "good guys." At least 3 had their careers ruined and had to leave their jobs at NYCHA, others lost any chance of promotion. Harassment was a constant companion to those who helped DOI, and, as the bad guys always found out who was working with the IG/DOI, every Inspector who helped wound up facing that harassment.

I'd be lying if I said that everyone who was involved in the IG/DOI investigation did poorly in their chosen NYCHA careers. At least 4 of those who were listed as "suspects" in the corruption also experienced big career changes. They were promoted and given large pay raises by the powers-that-be* at NYCHA.

So, if DOI or City Hall starts whining about the publicity harming their investigation, please ignore them. If they had handled the Kennedy assassination they would still be "investigating" the TV coverage and Zapruder tapes as they thoroughly investigated whether it was murder, or if JFK committed suicide!

Okay. Let's get back to basics.

The three basic charges that caused
the birth of the Spotlight are:

  • 1) That over$50,000,000 in CAD contracts were being paid through NYCHA's Financial Management System (FMS) system. These same contracts did not exist in the CAD computer system that is supposed to track them. Simply put, this means that there were no records of inspections on any of these contracts. There was no way of knowing if the contracts were really being completed, no way of knowing if the contractor had insurance or was paying prevailing wage. In essence, it couldn't be said that any work was ever done on these contracts. The only thing that NYCHA had records of was checks signed over to contractors.
  • 2) That an IG/DOI investigation was carried out that showed wide scale bribery taking place in CAD. That the IG's office (known to those of us involved in this investigation as the "Keystone Kops") seemed to have bungled much of the investigation. Either that, or they had worn political handcuffs from the start, which made it impossible for them to perform in anything resembling a professional manner.
  • 3) But far worse than bungling a straight forward contractor to inspector bribery racket, a much more important scheme was given a green light by DOI. That occurred when I told the IG investigators about a report I received from one of our group of inspectors. This inspector, although realizing that his report was political dynamite, reported on a conversation he recently had. A conversation in which he learned of corruption in the executive level of NYCHA's Design Department. He gave me names, and more. I relayed it to the IG/DOI. For months, nothing happened. After I continually nagged them about this, the Department of Investigation closed down the entire investigation.
  • That's much more frightening than even
    investigative incompetence would be!
    The NYC Department of Investigation had just
    given it's official sanction to NYCHA corruption.

    Until now, those who worried about the Spotlight's uncovering of NYCHA corruption and mismanagement responded by trying to make some believe that the Spotlight was in the "Alien beings inhabit our sewers" type of trash tabloid category. That the charges of corruption were versions of some delusions we surrendered to in some fanatical zeal to tar our bosses with imaginary dirt.

    They ain't gonna be able to do that this time! No sir!

    But you'll have to be the judge of that.

    As you travel along with us, you'll see some (Click Here) hyperlinks.

    A few, in the beginning of the story, will just show how terrible the "normal" working environment can be at NYCHA. How rules and punishments are used in both an arbitrary and capricious manner. Although, as they must be, the examples are of things done to me, feel free to extrapolate from there. Almost every lower level NYCHA employee can tell tales similar to mine, with many of those being more egregious than those examples I have given. My hope is that it will become patently obvious that there is an immediate response of organized harassment the moment that an employee gets near to finding out about any of the various money making schemes being carried out at the executive levels of the Authority. I doubt that anyone can read this story without realizing that these folks can make one's daily life turn into a day in back stabbing hell.

    As you get to the main portion of the story, the links will indeed show an unmistakable pattern of retaliation against anyone who discovers and reports on corruption, environmental hazards or any other of the embarrassing NYCHA related problems. I believe, therefore, that each of those links are extremely important and relevant. They will each, in their own way, slowly close the walls in on those who have been ripping off NYCHA's tenants by stealing the taxpayer's money. And this time we hope to leave no wiggle room for the NYCHA worms to use in an attempt to get free of the charges.

    The fact that those millions of dollars in contracts were missing from CAD's Security contracts database(s) has never been disputed. As you'll see from some of the internal email and memos,there were always problems in trying to pin down security contract information. Records were never verifiable, and a single contract's data would vary widely from one database to another. Yet nothing was ever done to those in charge of producing that data. Well, that's not really true. Actually, instead of suffering some punishment for (at a very minimum) extremely sloppy record keeping, shortly after all of that contract data was discovered to be missing the two persons immediately responsible for the integrity of that data were promoted!

    Many of the other hyperlinks will bring up documents that show a pattern of harassment that could only be seen as an attempt to "kill the messenger." I believe that when you read the back-and-forth communication between the various players, you will lose any doubt that NYCHA, and quite likely City Hall, have conspired to cover over one of the biggest scandals to hit our City in years.

    You'll find that these charges have not just recently surfaced. And you'll see that plenty of people who had authority and/or responsibility over the various examples of illegal and/or immoral NYCHA activities chose to ignore the charges. Or worse, they were knowing participants in the various schemes.

    Why they ignored the reports, I can't understand. My background isn't that of someone who makes claims to get personal publicity. I refused to speak to anyone outside the normal government chain until I had written to everyone up to the Attorney General of the US. I have receipts for deliveries of reports on this scandal from various officials, including Andrew Cuomo of HUD. But no investigation!

    There will be links to the documents and reports that were sent to various authorities. These reports go back to early 1996. And the reports didn't just go to local NYCHA people, as this reply from the HUD IG shows (Click Here). There were also letters, faxes and email sent to US Senators, Members of Congress, NY Senate and Assembly members and NYC Council Members. Nothing has been done.

    Although I'm near certain that when these pages become public knowledge, every investigative/political body involved will be swearing that they've been investigating our charges for a long time now. However, if you ask any inspector connected with the aborted IG investigation, any CAD member who was connected to the Security Contracts Report, or anyone connected to the Spotlight, all of whom who might have been a good source of information for such investigation, you'll find that not one of these people have ever been contacted. I know that for a fact because, with the exception of Tony DiAlto who the IG has hidden somewhere (Arizona?), I've talked with each of them.

    No doubt you'll be amazed at how inept the IG's office was at handling this straight forward corruption investigation. I have personally laid out this story to both a former Federal prosecutor and a former assistant DA, and both say they would have loved getting this case. "A slam-dunk" was the Federal Prosecutor's term. And they had just a small percentage of the information you will be viewing.

    So it's my guess that, as the chapter of that Secret Police book (above) states, The IG As Lap Dog is what this administration has demanded. And it's what they've gotten.

    Further discouragement was delivered via the lack of response from other elected/appointed Government officials. We've emailed, faxed and written to scores of folks who, while they are collecting Government checks themselves, they don't seem too interested in protecting your tax dollars from being squandered through dealings concerning NYCHA. Click Here to see a list of just some of the people we've asked to help in getting an independent investigation of NYCHA.

    But again, you'll have to be the judge.

    So, if you'll click the link to Chapter 1, below, we'll get to that slow start we mentioned.

    Click here to go to Chapter 1
    Click here to jump to Chapter 2

    © 1999 Public Housing Spotlight and John Ballinger. All rights reserved.
    Get a Free Search Engine for Your Web Site

    Issue links are at page bottom
    or click here for a Directory page with Issue overviews.

    Click on the mailbox to send us your thoughts!
    Or Message/Fax us with info at 718/745-0170

    Links to all Issues are at page bottom

    Contact Jack Ballinger at nychaspotlight@netscape.net
    for a Real Audio sound clip containing a
    conversation wherein DOI Investigator
    John Kilpatrick discusses how he learned
    that 2 NYCHA execs attended
    a Mafia connected contractor's funeral .

    Contact Jack Ballinger at nychaspotlight@netscape.net
    for a Real Audio sound clip containing
    the (3 Meg) confession of Tony DiAlto.
    Tony was a member of a group of
    corrupt Contract Inspectors working at NYCHA.
    Neither Tony nor the person he confessed to
    sharing his bribes with (Richard Penesi)
    were ever charged, let alone prosecuted, by DOI.

    For a great source of general tenant information,
    visit the Tenant Net Home Page |

    And for a great source of New York City news and
    policy information, visit our friends at the Gotham Gazette

    City Limits GIF graphic- 3573 Bytes
    Click here to view City Limits Magazine

    nyc housing authority (public housing) symbol jpg - 5961 Bytes
    NYC Housing Authority's
    (NYCHA) own site

    hud pub hous gif - 167 Bytes
    U.S. Department of
    Housing and Urban Development

    451 7th Street S.W.,
    Washington, DC 20410
    Telephone: (202) 708-1112
    TTY: (202) 708-1455

    public housing authorities directors association - 4956 Bytes
    Public Housing Authorities
    Directors Association site

    Public Housing

    Directory page with Issue overviews. |
    Current Issue of the Public Housing Spotlight |
    Special NYCHA Corruption Issue |
    ATIS (Timekeeping System) Issue |
    Spotty's Home |

    Issue 1 | Issue 2 | Issue 3 | Issue 4 | Issue 5 |
    Issue 6 | Issue 7 | Issue 8 | Issue 9 | Issue 10 |
    Issue 11 | Issue 12 | Issue 13 | Issue 14 | Issue 15 |
    Issue 16 | Issue 17 | Issue 18 | Issue 19 | Issue 20 |
    Issue 21 | Issue 22 | Issue 23 | Issue 24 | Issue 25 |
    Issue 26 | Issue 27 | Issue 28 | Issue 29 | Issue 30 |
    Issue 31 | Issue 32 | Issue 33 | Issue 34 | Issue 35 |
    Issue 36 | Issue 37 | Issue 38 | Issue 39 | Issue 40 |
    Issue 41 | Issue 42 | Issue 43 | Issue 44 | Issue 45 |
    Issue 46 | Issue 47 | Issue 48 | Issue 49 | Issue 50 |
    Issue 51 | Issue 52 | Issue 53 | Issue 54 | Issue 55 |
    Issue 56 | Issue 57 | Issue 58 | Issue 59 | Issue 60 |
    Issue 61 | Issue 62 | Issue 63 | Issue 64 | Issue 65 |
    Issue 66 | Issue 67 | Issue 68 | Issue 69 | Issue 70 |
    Issue 71 | Issue 72 | Issue 73 | Issue 74 | Issue 75 |
    Issue 76 | Issue 77 | Issue 78 | Issue 79 | Issue 80 |
    Issue 81 | Issue 82 | Issue 83 | Issue 84 | Issue 85 |
    Issue 86 | Issue 87 | Issue 88 | Issue 89 | Issue 90 |
    Issue 91 | Issue 92 | Issue 93 | Issue 94 | Issue 95 |
    Issue 96 | Issue 97 | Issue 98 | Issue 99 | Issue 100 |
    Issue 101 | Issue 102 | Issue 103 | Issue 104 | Issue 105 |
    Issue 106 | Issue 107 | Issue 108 |
    Secret Santa Issue | Extra Issue 1 |
    2nd Anniversary Issue |