1098 C2RQANN3 Bender - Direct 1 A. Yes. 2 Q. Did either council member ever refuse to meet with you? 3 A. No. 4 Q. During this time period did you also make attempts to meet 5 with Sandy Annabi one on one to discuss her concerns? 6 A. Yes. 7 Q. What efforts did you make? 8 A. Well, we called the office. We reached out to other 9 elected officials. We reached out to trade unions. We reached 10 out to the mayor's office. We reached out to our consultants. 11 We even reached out to where she was employed. We spoke to 12 some board of directors there to see if she would speak with 13 us. 14 Q. Did she agree to meet with you at that time? 15 A. No, she did not. 16 Q. In your experience in politics, was it unusual for a public 17 official to refuse to meet with a developer on a project like 18 this? 19 A. Yes. I mean, in the 30 years I've worked in government and 20 in politics, we were able -- I was able to arrange meetings for 21 my principals with mayors or governors, senators or Congress 22 people, county officials, council members, local legislators, 23 and this was a unique case. 24 Q. What efforts did you make to get Sandy Annabi to support 25 the project during this time period? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1099 C2RQANN3 Bender - Direct 1 A. We had a couple of consultants that were -- that we had 2 hired, Pat Lynch Associates and Al Pirro. We worked with them, 3 you know, to try to, you know, get a meeting or to communicate, 4 and then we also used local state senator and council members 5 and anybody else that we could find to have some type of 6 relationship that we can get a meeting. 7 Q. Were you successful? 8 A. No. 9 Q. Please broadcast Government Exhibit 374. We direct your 10 attention to the spring of 2006. Do you recall receiving this 11 email? 12 A. I'm just new with these glasses. 13 Q. Maybe, Mr. Bender, if you just look at monitor next to you, 14 does that help? 15 A. Very much so. What was the question? 16 Q. Are you familiar with this email? 17 A. Yes. 18 Q. Who is John Swagerty? 19 A. John Swagerty was one of the gentleman who worked on the 20 project with our project coordinators. 21 Q. Did he attach a copy of Judge Colabella's decision? 22 A. Yes, he did. 23 Q. What was the date of the decision? 24 A. It was May 2, 2006. 25 Q. Prior to May 2 of 2006, how many votes did you need? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1100 C2RQANN3 Bender - Direct 1 A. Four. 2 Q. Did you have four votes? 3 A. At that point in time, yes. 4 Q. What effect did Judge Colabella's decision on May 2 of '06 5 have? 6 A. What it did essentially was we needed a fifth vote for a 7 super majority. 8 Q. What, if any, efforts did you make during this time period 9 to obtain more information about Zehy Jereis? 10 A. Again, we asked people from the community that we were 11 dealing with from the start of the project, which was in 2002, 12 about, you know, who he is, what his function is, you know, how 13 he interrelates into the politics or the structure of Yonkers. 14 Q. Why were you seeking more information about Zehy Jereis at 15 this time? 16 A. Because what had happened was through a lot of our 17 conversations it seemed that people have told us that all roads 18 lead through Zehy Jereis to Sandy Annabi. 19 Q. Did you have any discussions with any other council members 20 or individuals, lobbyists at the time about whether you felt 21 you needed to contact Zehy Jereis or go through him prior to 22 May 2? 23 A. I believe -- I believe I did. I went through -- I mean, I 24 had asked our consultants if we should, and they said they had 25 everything under control. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1101 C2RQANN3 Bender - Direct 1 Q. Let me direct your attention to June 2 of 2006. Do you 2 recall that day? 3 A. Yes. 4 Q. Please maximize Government Exhibit 391A. Maximize the 5 June 2 entry. Is this your calendar? 6 A. Yes, it is. 7 Q. And what does it reflect? 8 A. It reflected my meeting schedule. 9 Q. Did you attend a meeting that day? 10 A. Yes, I did. 11 Q. Where was the meeting? 12 A. There was two on there. One earlier in the day and one in 13 the latter part of the day. In the latter part of the day was 14 with Assemblyman Joseph Lentol at Marco Polo. 15 Q. Who set up the meeting? 16 A. The assemblyman. 17 Q. What was the purpose of the meeting? 18 A. It was to meet some people from Yonkers who could possibly 19 help us with the project. 20 Q. Who attended the meeting? 21 A. It was attended by Assemblyman Lentol, Joe Galimi, Zehy 22 Jereis, Scott Cantone and myself. 23 Q. Had you ever met Zehy Jereis before this meeting? 24 A. No. 25 Q. What, if anything, did you say to him when you were SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1102 C2RQANN3 Bender - Direct 1 introduced? 2 A. It was somewhat cordial. I asked him why he was against 3 our project. He responded that he really wasn't against our 4 project; that it was a great project. And then I responded 5 that, "well, everybody is saying that you're against the 6 project, and you're the one who is holding it up." And then he 7 responded, "well, maybe you just hired the wrong people." 8 Q. What, if anything, did Zehy Jereis tell you about his 9 background at this meeting? 10 A. He was very involved in Yonkers. I believe he was the 11 Republican chairman of the party over there; that he helped 12 elect or he assisted in the electing of many of the officials 13 in the city of Yonkers, and that he also actually did the 14 campaign for Sandy Annabi, he helped elect Ms. Annabi as the 15 councilwoman. 16 Q. Was the subject of the status of the Ridge Hill project 17 discussed during the meeting? 18 A. Yes. 19 Q. What, in substance, did Zehy Jereis say about the Ridge 20 Hill project? 21 A. Once again, he said that he was, you know, he was for the 22 project, and that he didn't have any problems with the project. 23 Q. What, if anything, did he say about his relationship with 24 Sandy Annabi at the meeting? 25 A. He said he had a relationship with her. He actually said SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1103 C2RQANN3 Bender - Direct 1 that he -- he had knocked her opponent off the ballot when she 2 was running for city council, and by doing that just helped 3 elect that person, you know, to the seat. 4 Q. Was your understanding that he was telling you this was a 5 social or political relationship? 6 A. Political relationship. 7 Q. What, if anything, did Zehy Jereis say about the subject of 8 whether a meeting could be arranged with Sandy Annabi? 9 A. At that point in time he said that he would try -- he 10 didn't give any commitments at that meeting, but he said that 11 he would, you know, come back and he'll see what he could do 12 about it, and we left it at that. 13 Q. Was Mr. Jereis successful in setting up a meeting with 14 Sandy Annabi? 15 A. Yes. 16 Q. Please broadcast Government 445A in evidence. Maximize the 17 receipt on the right. I show you the receipt that's been 18 received in evidence for a meeting at Jake's Steakhouse. Did 19 you attend this meeting? 20 A. Yes, I did. 21 Q. What was the date of the meeting? 22 A. June 9. 23 Q. Who attended the meeting? 24 A. It was attended by Zehy Jereis, Council Member Annabi, 25 Scott Cantone, Rich Pesin and myself. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1104 C2RQANN3 Bender - Direct 1 Q. Prior to this meeting, had you ever been able to get a 2 direct one-on-one meeting with Sandy Annabi? 3 A. No. 4 Q. When you were introduced to Sandy Annabi, what, if 5 anything, did you say? 6 A. I asked her why she wouldn't meet with us. I said, you 7 know, we weren't bad people. I said I just wanted to get 8 together to explain the project. 9 Q. Where is Jake's Steakhouse located? 10 A. I believe it's on the border of the Bronx, Yonkers line. 11 Q. What, in substance, was discussed at the meeting? 12 A. We actually did discuss the project. We discussed some of 13 the issues that the council member had with the project. 14 Q. And what, if any, reaction did Rich Pesin and Sandy Annabi 15 have at the meeting? 16 A. The discussion was based on the amount of real estate taxes 17 or the taxes that we were contributing to the city of Yonkers. 18 Ms. Annabi wanted more than we had, you know, originally 19 offered in our documents, and that's what more or less 20 Mr. Pesin and Ms. Annabi were discussing. 21 Q. Without Sandy Annabi's support, what was the status of the 22 project at this time? 23 A. I believe we were going to challenge the, you know, the 24 decision in court, and we were at a standstill. 25 Q. Did any member of Forest City Ratner at the meeting offer SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1105 C2RQANN3 Bender - Direct 1 any additional tax payments? 2 A. Yes, Rich Pesin did. 3 Q. Do you recall how much in additional taxes Forest City 4 Ratner agreed to pay at the meeting? 5 A. I believe -- don't hold me to the exact amount -- but 6 approximately $10 million. 7 Q. During this meeting, did Forest City Ratner make any 8 additional commitments to address traffic mitigation? 9 A. No, we did not. 10 Q. During this meeting, did Forest City Ratner make any 11 concessions with proposals that had not been previously 12 offered? 13 A. Not that I'm aware of. 14 Q. Did you come to any final agreement at the meeting? 15 A. No, we didn't. At this time we were -- it was still in 16 more or less the discussion phase, so we were just discussing 17 the number on the property taxes, discussing the size of the 18 project and so on and so forth, but nothing was-- 19 MR. CARBONE: Would this be a good time to break, your 20 Honor? 21 THE COURT: If it's the end of this meeting. When you 22 reach the end of the questions about this meeting, it's a good 23 time to break. 24 BY MR. CARBONE: 25 Q. How did you leave off at this meeting? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1106 C2RQANN3 Bender - Direct 1 A. That we would probably meet again. 2 MR. CARBONE: That's the end of the meeting. 3 THE COURT: Then it's time for lunch. I'll see you at 4 2:00. Don't discuss the case. Keep an open mind. 5 (Jury recessed; luncheon recess) 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1107 C2RUANN4 Bender - direct 1 A F T E R N O O N S E S S I O N 2 2:05 p.m. 3 (In open court, jury present) 4 BRUCE BENDER, resumed. 5 THE COURT: You are still under oath, sir. 6 MR. CARBONE: May I, your Honor? 7 THE COURT: Yes, Mr. Carbone. 8 DIRECT EXAMINATION (Continued) 9 BY MR. CARBONE: 10 Q. Mr. Bender, when we broke, I think you testified about the 11 way the June 9th meeting had ended up. I think you said that 12 there was no final agreement, but you were going to agree to 13 talk some more, is that right? 14 A. Correct. 15 Q. Did in fact you have any further discussions with either 16 Mr. Jereis or Mr. Annabi? 17 A. I believe we had one conversation with Mr. Jereis after the 18 9th. 19 Q. Who was primarily responsible from your end for negotiating 20 the details of the agreement? 21 A. Rich Pesin. 22 Q. What was Scott Cantone's role as far as communicating with 23 Mr. Jereis? 24 A. Just more or less as an intermediary. 25 MR. SIANO: Your Honor, I wonder if you could ask the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1108 C2RUANN4 Bender - direct 1 witness to speak closer to the microphone? 2 THE COURT: I will. Use that microphone, OK. 3 Q. Was it Mr. Cantone who was actually doing the communicating 4 with Mr. Jereis? 5 A. Partly. 6 MR. CARBONE: Please broadcast Government Exhibit 404 7 in evidence. 8 Q. What is Government Exhibit 404? 9 A. It is my call sheet. 10 Q. What is a call sheet? 11 A. It is messages taken by my assistant when I am not in the 12 office or messages off of my cell phone. 13 Q. Who is your assistant? 14 A. Debbie Venezia. 15 MR. CARBONE: Please maximize the middle line. 16 Q. What is the message indicated there that was left for you? 17 A. It was a message from my assistant basically saying that 18 Zehy called and he is at home. 19 Q. What was the date of this call sheet? 20 MR. CARBONE: Please maximize the top. 21 A. June 13th. 22 Q. Who is "Zay"? 23 A. That is Mr. Jereis. 24 Q. Now, at the time, who had most of the contact with Zehy 25 Jereis? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1109 C2RUANN4 Bender - direct 1 A. I believe it was Mr. Cantone. 2 Q. Did there come a time when there was another meeting? 3 A. Yes, sir. 4 Q. What was the date of that meeting? 5 A. That was on June 14. 6 Q. Where was that meeting? 7 A. At Madison's. 8 Q. Prior to that meeting, did Mr. Jereis provide you with any 9 advice? 10 A. Yes, I believe so. 11 Q. What if anything did he say? 12 A. I mean, just how we should handle the next meeting. 13 Q. When you say "handle the next meeting," what meeting are 14 you referring to? 15 A. The meeting that we were going to have on the 14th. 16 MR. CARBONE: Please broadcast Government Exhibit 17 391C. 18 Q. Is this your calendar entry for that day? 19 A. Yes, sir. 20 Q. Tell us what the entry says in the bottom left where it 21 says 2:30 to 4. 22 A. Friends of Yonkers, Madison's and Riverdale Avenue. 23 Q. Is that the meeting that you just described at Madison's 24 restaurant? 25 A. Yes, sir. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1110 C2RUANN4 Bender - direct 1 Q. Where was Madison's located? 2 A. Again, I believe it is on Riverdale Avenue in the Bronx -- 3 on the Bronx-Yonkers border. 4 Q. Did you pick up the check that day? 5 A. I believe I did. 6 MR. CARBONE: Please broadcast Government Exhibit 402, 7 page 3 and maximize the middle receipt. 8 Q. Is that a photocopy of your signature? 9 A. Yes. 10 Q. What is the date of that check? 11 A. It should be June 14th. I don't see it -- June 14th. 12 Q. Can you just explain the substance of the discussions that 13 took place at this meeting? 14 A. It was about the real estate tax contribution that we were 15 going to further make to the City of Yonkers. It was a 16 continued discussion about just some of the other issues that 17 were kind of outstanding during -- from the June 9th 18 conversation. 19 Q. What if anything did Mr. Jereis say about the project 20 during that meeting? 21 A. He was supportive of the project. 22 Q. But who was there? 23 A. It was Ms. Annabi, Zehy Jereis, Scott and myself and Rich 24 Pesin. 25 Q. Scott is Scott Cantone? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1111 C2RUANN4 Bender - direct 1 A. Yes. 2 Q. And your recollection is that Rich Pesin was there as well? 3 A. Yes. I think he may have come late and didn't stay for the 4 whole meeting. 5 Q. Did you reach any final agreement during that meeting? 6 A. Yes, we did. 7 Q. What was the substance of the agreement? 8 A. That we were -- that the company was going to contribute 9 more dollars to the City of Yonkers as it relates to real 10 property taxes and that we were going to create an education 11 fund. 12 Q. I'm sorry? An education fund? 13 A. Yes. 14 Q. Who had asked for the education fund? 15 A. The council member. 16 Q. Which council member? 17 A. Council Member Annabi. 18 Q. Did that ever come to pass? 19 A. No. 20 Q. Did Council Member Annabi ever follow up on that education 21 fund request? 22 A. Not that I can recall. 23 Q. How did Ms. Annabi announce her support for the project? 24 A. Through a press release. 25 Q. Who drafted the press release? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1112 C2RUANN4 Bender - direct 1 A. Scott Cantone assisted in drafting it. 2 Q. During the month of June, did you have any direct 3 discussions with Zehy Jereis on the subject of whether Forest 4 City Ratner would hire him as a consultant? 5 A. On one occasion. 6 Q. When was the first time you had any direct discussion with 7 Zehy Jereis about whether Forest City Ratner would hire him? 8 A. I think on June 28th. 9 Q. What happened on June 28th? 10 A. There was a meeting with Scott Cantone, Rich Pesin, myself 11 and Mr. Jereis. 12 Q. Do you recall where the meeting took place? 13 A. At Dunkin' Donuts in Yonkers. 14 Q. Was the subject of whether Forest City Ratner would hire 15 Zehy Jereis discussed at this meeting? 16 A. Yes. 17 Q. Approximately how many days after Sandy Annabi announced 18 her support for the project did the meeting take place? 19 A. Less than two weeks or pretty close to it. 20 Q. Now, had he asked to meet with you sooner? 21 A. Yes. 22 Q. On this subject? 23 A. He didn't ask. Scott Cantone asked. 24 Q. Did Scott Cantone convey to you that he had asked? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1113 C2RUANN4 Bender - direct 1 Q. Did you agree to meet with him sooner? 2 A. No. 3 Q. Why not? 4 A. It was just an uncomfortable feeling. 5 Q. Uncomfortable in what way? 6 A. Just the whole dynamics of the situation was uncomfortable. 7 On the one hand, we finally got to meet the Councilwoman Annabi 8 on the other hand, you know, he was asking for a consulting 9 contract. It just didn't feel good. 10 Q. What if any pressure did you feel when he was asking for a 11 consulting contract? 12 A. The pressure that I felt corporately was that it took 13 months to finally get a meeting with the councilwoman and the 14 person who brought her to the table could easily, you know, 15 take that away also. So we were caught between a rock and a 16 hard place. 17 Q. As of this date and referring again to June 28 of 2006, had 18 Sandy Annabi actually voted in favor of the project at this 19 time? 20 A. No. 21 Q. What if any discussions did you have at this meeting with 22 Zehy Jereis on the subject of whether you could hire him? 23 A. We ended up, it was inconclusive but certainly we left the 24 impression that we were probably going to do it. 25 Q. When you say "left the impression," you mean left that SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1114 C2RUANN4 Bender - direct 1 impression with Mr. Jereis? 2 A. Yes. 3 Q. Why did you leave him with that impression? 4 A. Because, I said it earlier is that, we didn't know what 5 tomorrow was going to be and as it relates to just the 6 relationships and the vote was coming up on July 11th, so we 7 just, you know, wanted to just keep the discussions going, per 8 se. 9 Q. Approximately how much money had been invested in the 10 project by this time, June 28th? 11 A. I would say somewhere between 70 and 80 million dollars. 12 Q. At this June 28th meeting where Mr. Jereis was asking for a 13 job, did you know or did you have any information that he had 14 paid $10,000 towards the purchase of a Mercedes-Benz for 15 Ms. Annabi? 16 A. No, sir. 17 Q. Did you know that he had given her tens of thousands of 18 dollars for the purchase of three separate pieces of real 19 estate? 20 A. No, sir. 21 Q. Did you know that he had paid thousands and thousands of 22 dollars towards loans for her? 23 A. No. 24 Q. Did you know that he had given her any financial benefits 25 like that? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1115 C2RUANN4 Bender - direct 1 A. No. 2 Q. Had you known that, would you have led him to believe that 3 you would hire him? 4 A. No, sir. Not at all. 5 Q. Do you recall the day that the city council voted on the 6 Ridge Hill project? 7 A. Yes. 8 Q. What day was that? 9 A. July 11th. 10 Q. Did you meet with Councilwoman Annabi on that day? 11 A. Yes, I did. 12 Q. Where did you meet with her? 13 A. At a Starbucks on Central Avenue in Yonkers. 14 Q. Who set up the meeting? 15 A. Mr. Jereis. 16 Q. Was Mr. Jereis present? 17 A. Yes. 18 Q. What was the purpose of the meeting? 19 A. I think it was just to recap, you know, our last three 20 weeks together, talk about the project. For me it was just to 21 insure that she was still with us and that we could still count 22 on her vote. 23 Q. What if any assurances did you receive that day from her 24 that she was going to support the project? 25 A. She made a commitment during coffee that she was still very SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1116 C2RUANN4 Bender - direct 1 supportive of the project. 2 Q. Did she in fact vote to support the project that night? 3 A. Yes, sir. 4 Q. After Sandy Annabi voted to support the project, did Forest 5 City Ratner hire Zehy Jereis as a consultant? 6 A. Yes. 7 Q. Do you recall what he was hired to do? 8 A. He was supposed to do some retail hunting, which means to 9 find sites for the company and, I believe, to advise 10 Mr. Cantone and myself on the politics and the goings-on from a 11 political perspective of what was going on in Yonkers. 12 Q. Other than producing Sandy Annabi's vote, are you aware of 13 any value Zehy Jereis added to Forest City Ratner? 14 A. No. 15 Q. Were you grateful that he was able to get you a meeting 16 with Sandy Annabi? 17 A. Yes, very much so. 18 MR. CARBONE: Please broadcast Government Exhibit 443. 19 Would you maximize the third paragraph, first sentence. 20 Q. It says: "During the term, consultant shall deliver a 21 written report to FC Acquisition, "the report", at least once 22 per month, regarding general matters and happenings within 23 Westchester County and issues that may be time sensitive and of 24 interest to FC Acquisition." 25 Now, this agreement was backdated to August 1, is that SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1117 C2RUANN4 Bender - direct 1 correct? 2 A. Yes. 3 Q. When is the first time you saw any reports generated by 4 Mr. Jereis? 5 A. I think in March. 6 Q. Was that after the investigation began? 7 A. Yes, sir. 8 Q. Now, the last sentence of the first paragraph, it says that 9 Mr. Jereis shall be reporting directly to Bruce Bender, Richard 10 Pesin and Scott Cantone and other senior members of FC 11 Acquisition and its affiliates. 12 Did Mr. Jereis report to you during this time period? 13 A. I can't recall. 14 Q. Approximately how many times would you say that you met 15 with him between the time period August 1, 2006 and March of 16 2007? 17 A. Maybe once or twice. I am not sure. 18 Q. Approximately how many times did you talk to him by phone? 19 A. Maybe the same amount. 20 Q. Did you receive any monthly reports from him during that 21 time period? 22 A. No. 23 Q. Has he ever been to your office? 24 A. No. 25 Q. Do you know whether he has ever been to Forest City SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1118 C2RUANN4 Bender - direct 1 Ratner's offices? 2 A. No. 3 MR. CARBONE: May I have a moment, your Honor? 4 No further questions. 5 Thank you. 6 CROSS-EXAMINATION 7 BY MR. ARONWALD: 8 Q. Mr. Bender, you don't know who I am, do you? 9 A. No, sir. 10 Q. That's because we never met, right? 11 A. That's correct. 12 Q. My name is William Aronwald. 13 I am the attorney representing Sandy Annabi. 14 A. Pleasure to meet you. 15 Q. Pleasure to meet you too. 16 Actually you were aware before you took the stand 17 today that I had made several attempts to meet with you, is 18 that correct? 19 A. Not to my knowledge. 20 Q. Do you know who David Franco is? 21 A. Yes, sir. He is the corporation's attorney. 22 Q. Weren't you aware through what Mr. Franco told you that I 23 had asked to meet with you? 24 MR. CARBONE: Objection. 25 THE COURT: The objection is sustained. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1119 C2RUANN4 Bender - cross 1 Q. So you were never aware that I had made efforts to speak to 2 you about this case? 3 MR. CARBONE: Objection. 4 THE COURT: The objection is sustained. 5 Q. Now, you began working with Forest City Ratner in 2002, 6 correct? 7 A. In 2000. 8 Q. 2000. 9 You don't work at Forest City Ratner anymore, do you? 10 A. That's correct. 11 Q. When was it that you left Forest City Ratner? 12 A. A couple of weeks ago. 13 Q. Do you have a date, prior to February 14th? 14 A. February 17th, I believe. 15 Q. Did Scott Cantone leave with you? 16 A. No, he did not. 17 Q. Did Richard Pesin leave with you? 18 A. Richard Pesin left earlier, sooner. 19 Q. When you left Forest City Ratner, what are you doing 20 currently? 21 A. I am the co-founder of a consulting firm. 22 Q. I am going to ask you, if you would, just to speak closer 23 to the microphone so that I can see you and so that every one 24 of the jurors can hear you. 25 Thank you. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1120 C2RUANN4 Bender - cross 1 What is the name of your consulting firm? 2 MR. CARBONE: Objection. 3 THE COURT: Ground? 4 MR. CARBONE: Relevance, what he is doing now. 5 THE COURT: The objection is overruled. Background 6 information. 7 What is the name of your firm now. 8 THE WITNESS: Bender Cantone Consulting. 9 BY MR. ARONWALD: 10 Q. Is Cantone, Scott Cantone? 11 A. Yes, sir. 12 Q. So he also has left Forest City Ratner? 13 A. No. His date is -- I don't know exactly what his date is, 14 but probably a month from now, probably sometime in March. 15 Q. I apologize because I didn't ask the question correctly, so 16 let me ask the question differently. 17 So you and Scott Cantone are forming your own or have 18 already formed your own consulting company, correct?. 19 MR. CARBONE: Objection. 20 THE COURT: The objection is overruled. 21 Q. Is that correct, Mr. Bender? 22 A. Yes, sir. 23 Q. Now, when you began the Ridge Hill project which I think 24 you testified earlier began in 2002? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1121 C2RUANN4 Bender - cross 1 Q. At that time the Ridge Hill project, was that considered 2 like one of the largest projects in Forest City Ratner's 3 inventory of projects at that time? 4 A. I am really not sure of that. At that time we were doing, 5 I believe The New York Times building -- 6 Q. I still can't hear you? 7 A. I am not sure of that. I believe at that point in time we 8 were doing The New York Times building which was larger than 9 that. 10 Q. But it certainly was a large project? 11 A. Yes. 12 Q. In fact -- 13 A. Let me just correct, we were also starting on Atlantic 14 Yards also, which was larger than the Ridge Hill project. 15 Q. Did you have a contract with Forest City Ratner? 16 A. No, I did not. 17 Q. Once Ridge Hill was developed, isn't it true that you and 18 others that were working for Forest City Ratner were going to 19 be paid more money? 20 MR. CARBONE: Objection. 21 THE COURT: The objection is sustained. 22 Q. You had a financial interest in Ridge Hill being developed, 23 didn't you? 24 MR. CARBONE: Objection. 25 THE COURT: Overruled. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1122 C2RUANN4 Bender - cross 1 Q. Didn't you, sir? 2 A. I guess so. 3 Q. In what way did you have a financial interest in the event 4 that Ridge Hill was developed? 5 I am going to ask you again, please closer to the 6 microphone. 7 Go ahead. 8 A. Could you repeat the question, please? 9 Q. In what way did you have a financial interest in Ridge Hill 10 being developed? 11 A. There was a complicated formula that was based upon its 12 assessed value after it stabilized. 13 Q. How would that translate into you having a financial 14 interest? 15 A. Well, what could have happened, like with other projects, 16 there is none and there is no financial interest. It was all 17 dependent upon the stabilization, the interest costs, the 18 financing, the time the space wasn't leased because there were 19 several projects in which there was no interest that anybody 20 received. So -- 21 Q. I am talking about Ridge Hill as a developed project, not 22 as a project in the planning stage. If Ridge Hill had been 23 developed, what was your financial interest? 24 A. Again, the answer is, I don't know what the interest was 25 because it was based upon a formula, and whatever that formula SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1123 C2RUANN4 Bender - cross 1 was, that would have been the interest. 2 THE COURT: We can move on now. 3 Q. Forest City Ratner employed a number of consultants in 4 connection with their efforts to get the Ridge Hill project 5 passed, correct? 6 A. Yes, sir. 7 Q. And those included Al Pirro? 8 A. Yes, sir. 9 Q. And those included Michael Spano? 10 A. It was Pat Lynch Associates. 11 Q. You knew that Michael Spano worked for Pat Lynch 12 Associates? 13 A. Yes. 14 Q. You knew that Michael Spano was related to New York State 15 Senator Nick Spano, correct? 16 A. Yes, sir. 17 Q. You also had another consultant or lobbyist by the name of 18 Milio? 19 A. Yes. 20 Q. Now, Al Pirro, Mike Spano were tasked with getting Sandy 21 Annabi to vote yes, correct? 22 A. Yes. 23 Q. Milio was tasked with getting Pat MacDow's vote? 24 A. Yes, sir. 25 Q. With respect to Al Pirro and Mike Spano or Patricia Lynch SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1124 C2RUANN4 Bender - cross 1 and Associates, they were tasked not only with getting Sandy 2 Annabi to change her vote, but they were also tasked with 3 persuading John Murtagh and Dee Barbato to consider changing 4 their votes? 5 A. Yes. 6 Q. In fact, those efforts began in 2004, would that be 7 correct? 8 A. I don't know the exact date. It is possible. 9 Q. Let's see if we can put a time frame on it. 10 Mr. Carbone asked you how many votes were needed to 11 pass the Ridge Hill project in 2005, and you told him that it 12 was five votes, correct? 13 A. No, it was four votes. 14 Q. Didn't there come a time when the Westchester County 15 planning board issued a negative vote on Ridge Hill due to the 16 environmental issues that the planning board was concerned 17 about? 18 A. Yes. 19 Q. And as a result of the negative vote issued by the 20 Westchester County planning board, isn't it true that in order 21 to pass Ridge Hill, you needed a super majority or five of the 22 seven votes on the city council? 23 A. Yes. 24 Q. Isn't it true that on November 22 of 2005, the Yonkers City 25 Council passed a resolution to eliminate the need for the super SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1125 C2RUANN4 Bender - cross 1 majority? 2 A. Yes. 3 Q. And under that scenario, a simple majority of four votes 4 was all that was required to pass the project, correct? 5 A. Correct. 6 Q. So when I asked you before about when the effort began to 7 get these consultants to get access to Sandy Annabi, was Al 8 Pirro retained before or after the Westchester County planning 9 board issued its negative vote? 10 A. To the best of my recollection, Al Pirro was hired at the 11 outset of the project, at the very beginning. 12 Q. So that would have been before the Westchester County 13 planning board? 14 A. Correct. 15 Q. So at the time that Al Pirro was hired, all was required 16 was a simple four to three majority? 17 A. Correct. 18 Q. In fact, before the Westchester County planning board 19 issued its negative finding with respect to the project, the 20 vote in the city council was four to three for the project, 21 correct? 22 A. Yes, sir. 23 Q. But because of the super majority, a four-to-three vote was 24 not enough? 25 A. Correct. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1126 C2RUANN4 Bender - cross 1 Q. Now, were you involved in discussions with respect to the 2 four city council members that were in favor of the Ridge Hill 3 project to put together this resolution to do away with the 4 super majority requirement? 5 A. I had knowledge of those discussions. 6 Q. And you had knowledge of those discussions because you were 7 involved in those discussions with the city council members who 8 were in favor of the project, correct? 9 A. Correct. And a lot of it were on the periphery. 10 Q. Do you remember having specific discussions about doing 11 away with the super majority with City Council President 12 Martinelli? 13 A. Yes. 14 Q. Do you recall having specific discussions about doing away 15 with the super majority with City Council Member Liam 16 McLaughlin? 17 A. Yes. 18 Q. Do you remember having discussions about doing away with 19 the super majority with City Council Member Dennis Robertson? 20 A. I am not sure of that. 21 Q. Do you remember having discussions about doing away with 22 the super majority requirement with City Council Member Pat 23 MacDow? 24 A. I am not sure of that. 25 Q. You were a proponent -- you were advocating to SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1127 C2RUANN4 Bender - cross 1 Mr. Martinelli and to Mr. McLaughlin that they put together a 2 resolution to do away with the super majority to pave the road 3 for the Ridge Hill project to be approved, correct? 4 A. No. That is somewhat not accurate. Basically, it was 5 council Member McLaughlin's idea and concept because he knew 6 the regulations of the law, and I believe that he had come 7 forward with that idea. 8 Q. Just to switch topics for a moment because I will probably 9 forget it if I don't ask it, I want to direct your attention to 10 the meeting on July 11 of '06 that you had with Ms. Annabi to 11 shore up and make sure that she was still supporting the 12 project, correct? 13 A. Yes, sir. 14 Q. Do you recall that meeting was at, what, 2:30 in the 15 afternoon or somewhere around that time? 16 A. It was in the afternoon. I don't know the exact time. 17 Q. But do you recall that Sandy was in a hurry to leave? 18 A. I don't recall that she was in a hurry to leave. 19 Q. Do you recall her telling you that she had to get out 20 because there was going to be another project on the city 21 council agenda that night in addition to Ridge Hill, namely, 22 Longfellow? 23 MR. CARBONE: Objection. 24 THE COURT: Overruled. 25 Q. Do you recall that? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1128 C2RUANN4 Bender - cross 1 A. I don't recall that. 2 Q. Do you recall calling Dennis Robertson and asking him if he 3 could move the Longfellow item off of the city council agenda 4 so that you could speak to Sandy about the vote that was 5 supposed to take place that night on Ridge Hill? Do you recall 6 that? 7 A. No, I do not recall that. 8 Q. Getting back to the super majority issue, so as of November 9 22, 2005, you had been unsuccessful in your efforts to speak to 10 Sandy Annabi, correct? 11 A. Yes, sir. 12 Q. Now, did you attend any of the city council meetings that 13 were held with respect to the Ridge Hill project? 14 A. I think early on, maybe one or two. 15 Q. Did you attend the city council meeting on November 22, 16 2005 when the issue was placed on the city council agenda about 17 doing away with the super majority requirement? 18 A. I can't recall being there or not being there, but I could 19 have been there. 20 Q. In any event, you were aware as of November 22nd of 2005 21 what Ms. Annabi's objections were to the original project, 22 weren't you? 23 A. They were similar to that of Council Member Dee Barbato. 24 Q. Except for Council Member Dee Barbato, Ridge Hill was in 25 her district, correct? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1129 C2RUANN4 Bender - cross 1 A. Yes, sir. 2 Q. And Sandy Annabi was representing a completely different 3 district that was somewhat further removed from Ridge Hill than 4 where Dee Barbato was, correct? 5 A. Were separate. 6 Q. So among the issues that Sandy Annabi was concerned about 7 was the one that was a pilot, a payment of lower taxes, 8 correct? 9 A. Yes. 10 Q. And she was opposed to that, correct? 11 A. I don't recall if she was opposed to it, per se. I think 12 the issue at the time was that a lot of the council members 13 wanted to see it. 14 Q. By the way, with respect to Milio, Milio was the consultant 15 or lobbyist whose job it was to introduce Forest City Ratner to 16 Councilwoman MacDow, correct? 17 A. That's correct. 18 Q. And his efforts were successful? 19 A. Yes, sir. 20 Q. And she became a supporter of the project, correct? 21 A. Yes. 22 Q. And Forest City Ratner entered into an agreement with Mr. 23 Milio, correct? 24 MR. CARBONE: Objection. Relevance. 25 THE COURT: The objection is sustained. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1130 C2RUANN4 Bender - cross 1 Q. So beginning in the fall of 2005, or at least as of the 2 fall of 2005, Forest City Ratner's efforts to get access to 3 Sandy Annabi through Al Pirro, Mike Spano, Nick Spano, those 4 had all failed, correct? 5 A. Correct. 6 Q. And this was the source of great frustration to you, wasn't 7 it? 8 A. Yes, sir. 9 Q. In fact more than frustration, you were angry about it, 10 weren't you? 11 A. I don't know if I was angry or it was frustration. 12 MR. ARONWALD: Could I have the September 25th email 13 from Mr. Mike Spano to Mr. Bender up. I forget the number. 14 MR. HALPERIN: 371. 15 MR. CARBONE: The redacted one? 16 MR. ARONWALD: Yes. Is the entire one in? 17 MR. CARBONE: No. 18 MR. ARONWALD: Let's do the redacted one, 371. 19 BY MR. ARONWALD: 20 Q. Now, in September of 2005, how often were you speaking to 21 Mike Spano concerning his efforts to get access to Sandy Annabi 22 with respect to the Ridge Hill project? 23 A. I was actually speaking with him and other members of his 24 firm, so several times or more. 25 Q. Several times a day, several times a week, several times a SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1131 C2RUANN4 Bender - cross 1 month? 2 A. It wasn't really on a daily basis. 3 Q. But in any event, on September 25th, you received an email 4 from Mr. Spano, Mike Spano in which he says, "Hi Bruce, I have 5 taken every angle with this Sandy. I have Nick involved, Zehy 6 and Anthony. We have all talked to her more than once. She 7 has not moved. We have unions heads talking to her too. We 8 are still working it." 9 Now, the Nick that is referred to in that email is 10 Senator Nick Spano, correct? 11 A. Yes, sir. 12 Q. And Zehy is Zehy Jereis, correct? 13 A. Yes, sir. 14 Q. So as of September of 2005, you were familiar with the name 15 Zehy Jereis, correct? 16 A. I have heard the name, yes. 17 Q. You heard it in the context that Zehy Jereis had a close 18 relationship with Sandy Annabi, correct? 19 A. Yes. 20 Q. I mean, with respect to this email, 371R, Mr. Spano doesn't 21 say Zehy Jereis, he just referred to him as Zehy, so at the 22 time of this email you knew that the Zehy he was referring to 23 was Zehy Jereis? 24 A. Correct. 25 Q. Now the Anthony that he was referring to, that was Anthony SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1132 C2RUANN4 Bender - cross 1 Mangone, correct? 2 A. Yes. 3 Q. And you knew that Anthony Mangone was the chief of staff or 4 chief counsel for Senator Nick Spano, correct? 5 A. No, I wasn't sure of that. 6 Q. Did you know who Anthony Mangone was before you received 7 this email on September 25th? 8 A. Yes. I had heard the name. 9 Q. But did you know whether or not you heard the name in the 10 context of his having a relationship with Nick Spano? 11 A. I heard the name, initially and -- I could recollect was 12 that I thought that he was Council Member Dee Barbato's 13 campaign manager. 14 Q. So in any event, your best recollection was that you had 15 heard the name in connection with the relationship that he had 16 with Dee Barbato not Nick Spano, correct? 17 A. At that point, yes. 18 Q. This email was in response to your questioning Mike Spano 19 as to what progress had been made in developing access to Sandy 20 Annabi, correct? 21 A. Well, without seeing any of the prior emails, I would, you 22 know, say yes. 23 Q. Do you remember when you responded to that email? 24 A. No. 25 MR. ARONWALD: I have an exhibit that I would like to SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1133 C2RUANN4 Bender - cross 1 have marked as a defense exhibit, if that's OK. 2 THE COURT: Is it in evidence as a government exhibit? 3 MR. CARBONE: No, it is not, your Honor. 4 THE COURT: Then mark it as the next defendant exhibit 5 in sequence. 6 MR. CARBONE: In the interests of saving time, your 7 Honor, we have no objection. 8 THE COURT: It is admitted by the way as Defense 9 Exhibit whatever it is. 10 MR. ARONWALD: I believe it is 38. 11 THE COURT: Defendant's 38. 12 (Defendant Exhibit 38 received in evidence) 13 MR. ARONWALD: Mr. Turk, would you post this, please. 14 Can we just blow up the lines below -- the first two lines. I 15 think you need to narrow it down a little bit? 16 BY MR. ARONWALD: 17 Q. An RM is an abbreviation for "room," correct? 18 A. Yes. 19 Q. Directing your attention to the portion of the email after 20 the word "tomorrow," you are telling Mr. Spano, Mike Spano, "no 21 fucking around. Get Sandy on board. Tell your brother we need 22 help now. I have to close this and take care of my family." 23 That was an email that you sent to Mike Spano in 24 response to his email that we discussed just a few moments ago, 25 correct? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1134 C2RUANN4 Bender - cross 1 A. I would gather, yes. 2 Q. I'm sorry? 3 A. Yes. 4 Q. When you say, tell your brother we need help now, you are 5 referring to Senator Nick Spano, correct? 6 A. Yes. 7 Q. So you wanted Senator Nick Spano to exert whatever 8 political influence or whatever political pressure he had to 9 get Sandy Annabi to vote for this project, isn't that so? 10 A. Yes, that's correct. 11 Q. Between September 26th of 2005 and June 9th of 2006, you 12 were not given access to Sandy Annabi, correct? 13 A. Correct. 14 Q. In fact, the first meeting that you ever had with her was 15 on June 9th of 2006, correct? 16 A. Correct. 17 Q. Did you attend a meeting at the Westchester Country Club in 18 May of 2006? 19 A. Yes. 20 Q. A meeting that was hosted by Al Pirro? 21 A. Yes. 22 Q. And also present at that meeting was Scott Cantone? 23 A. Yes. 24 Q. And also present at that meeting were Council Members Dee 25 Barbato and John Murtagh, correct? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1135 C2RUANN4 Bender - cross 1 A. Correct. 2 Q. Sandy Annabi was not at that meeting, isn't that so? 3 A. I can't recall if she was there. 4 Q. But you do recall Ms. Barbato, Mr. Murtagh and Mr. Pirro 5 and Mr. Cantone being there together with you, correct? 6 A. Correct. 7 Q. And the purpose of that meeting was to explore the 8 possibility of swinging Dee Barbato and John Murtagh over in 9 support of the project, isn't that so? 10 A. It was a discussion of the open issues and how we could 11 resolve them, and if in fact we could resolve them, we were 12 hopeful that they would support the project. 13 Q. But the fact of the matter is that the meeting ended 14 unsuccessfully, isn't that so? 15 A. Yeah. I am always hopeful. I mean, do I have a commitment 16 from anybody? No. Was I going to stop trying? No. 17 Q. Well, the fact of the matter is, during that meeting, 18 Forest City Ratner did not make may any concessions during the 19 issues that were raised by either Dee Barbato or John Murtagh, 20 isn't that so? 21 A. I really can't remember. 22 Q. When you would have these meetings, was it your custom or 23 practice to prepare memoranda or documents, diary entries or 24 something concerning the meeting to memorialize the discussion? 25 A. I hardly ever wrote memos. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1136 C2RUANN4 Bender - cross 1 Q. I'm sorry? 2 A. I hardly ever wrote memos relating to our past meetings. 3 Q. How about dictating something into a voice recorder so that 4 your secretary or somebody could transcribe it into a memo? 5 Did you do that? 6 A. No. 7 Q. So you prepared no notes concerning this meeting at the 8 Westchester Country Club? 9 A. Not that I can recall. 10 Q. And you have no independent recollection that at the 11 meeting you, on behalf of Forest City Ratner, offered to make 12 any concessions to meet any of the concerns raised by Dee 13 Barbato or John Murtagh, isn't that true? 14 A. We had discussions over the issues. I can't recall if we 15 made any concessions. 16 Q. But at the conclusion of that meeting, you understood that 17 Dee Barbato and John Murtagh were still opposed to the project? 18 A. Yes. 19 Q. In fact wasn't it also your view that it would be virtually 20 impossible to persuade Dee Barbato to vote for this project 21 because the project was in her district, isn't that so? 22 A. In my experience in over 30 years of government, when it 23 comes to politics, there is nothing impossible and if the 24 project was good and if the project benefitted the city of 25 Yonkers, if we could relieve some of the traffic issues on SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1137 C2RUANN4 Bender - cross 1 Tuckahoe Road, I believe that possibly Council Member Dee 2 Barbato may have changed her mind. I don't know. 3 We, as a company, made a lot of efforts with Ms. Dee 4 Barbato about moving the east to the west side line, that we 5 had town hall meetings in her district. Whenever she needed 6 some type of information, we were available to her. With all 7 of that in mind, it was our opinion that, you know what, maybe, 8 you know, we could have convinced her community. Maybe we 9 could have convinced her that it was the right thing to do. It 10 was a good project. It wouldn't be that many impacts. 11 So I never gave up hope on Council Member Dee Barbato, 12 like I never gave up hope on Mr. Murtagh. Mr. Murtagh's issue 13 was really the pilot and the transparency of the pilot which I 14 believe as a company we wanted to, you know, give it out and 15 make it public, but it was the executive at the time, the 16 mayor's office who thought that there was an issue with it. So 17 I always thought that if we met the issues or the requests of 18 the elected officials, you don't know. 19 I am sorry to be long-winded. 20 Q. But the fact of the matter is that, as of July 11, 2006, 21 you had not put anything forward which resulted in Dee Barbato 22 or John Murtagh saying they were now in favor of the project, 23 that's correct, right? 24 A. No. I mean as it related to Ms. Dee Barbato and 25 Mr. Murtagh, I believe that we did make the pilot public or the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1138 C2RUANN4 Bender - cross 1 administration of the IDA did. 2 We had discussions -- one of the issues was how do you 3 reduce traffic. Well, you reduce traffic by reducing the size 4 of the project. So Rich Pesin put a metrics together in which 5 we showed if we reduced the project by this percent, this 6 percent or this percent, you know, this is what would happen, 7 you know, with the traffic. But, on the other hand, when you 8 do that, you lose jobs and you loss revenue for the city of 9 Yonkers. So we were having all of those discussions. 10 Now something might have, you know, stuck somewhere, 11 but we didn't give up hope. 12 Q. As of July 11, 2006, had you been successful in persuading 13 either Dee Barbato or John Murtagh to vote in favor of Ridge 14 Hill, yes or no? 15 A. No. 16 Q. Now, isn't it also true that you had tried to -- withdrawn. 17 Were you enlisting the support of other resources in 18 an effort to pressure Sandy Annabi to change her vote to yes? 19 A. I don't understand the word "pressure." 20 MR. CARBONE: Objection. 21 Q. Did you make -- 22 THE COURT: Excuse me. There was an objection. I 23 would like to hear the objection, to rule on it. 24 MR. ARONWALD: I apologize. 25 MR. CARBONE: Foundation. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1139 C2RUANN4 Bender - cross 1 THE COURT: Foundation? 2 MR. CARBONE: And ambiguous. 3 THE COURT: Overruled. 4 BY MR. ARONWALD: 5 Q. Did you make any effort to have Sandy Annabi's employer, 6 St. Joseph's Hospital, try to influence her to vote for this 7 project? 8 A. No. 9 10 (Continued on next page) 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1140 C2RQANN5 Bender - Cross 1 BY MR. ARONWALD: 2 Q. Didn't you try to reach out to Sandy Annabi through people 3 at the hospital where she worked? 4 A. Yes. 5 Q. And what did that consist of? 6 A. It consisted of given the fact that I was trying for weeks 7 and months to get in touch -- 8 Q. I didn't hear that. 9 A. I'm sorry. Given the fact that I was trying for weeks and 10 months and using all possible resources to set up a meeting 11 with the councilwoman and, again, I was unsuccessful, you know, 12 from elected officials, just trade unions to lobbyists to 13 anybody that I could find that might know her, I knew -- I went 14 to somebody who I was referred to was the board of directors at 15 the hospital, and the request I made was -- is there any way 16 that you could get a hold of Sandy Annabi and that she would 17 speak to me, so I could explain the project to her, at which 18 point a contact was made. I received her phone number. I 19 called her up at that number thinking that she was expecting my 20 phone call, at which time she hung up on me and said, "Don't 21 ever call me here at my place of work." 22 Q. And you never did after that, correct? 23 A. Correct. I respected her decision. 24 Q. I'm sorry? 25 A. I respected. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1141 C2RQANN5 Bender - Cross 1 Q. Now, when you had the meeting at the Marco Polo restaurant 2 on June 2, Sandy Annabi was not at that meeting, correct? 3 A. Correct. 4 Q. It's also true, is it not, that during that meeting, Zehy 5 Jereis did not suggest that he could help Forest City Ratner 6 obtain Sandy's support for the project, and that all that he 7 said was, "Let me think about it, maybe we can set up a meeting 8 with Sandy," isn't that true? 9 A. That's true. 10 Q. In fact, during the meeting, isn't it true that Mr. Jereis 11 said -- did not say that he could help you get the project 12 passed, isn't that true? 13 A. Can you repeat the question? 14 Q. Isn't it true that during the meeting, Zehy Jereis did not 15 say he could help Forest City Ratner get Ridge Hill passed? 16 A. I don't recall that. 17 Q. Do you recall being asked this question and giving this 18 answer before the grand jury at page 46/line-- 19 THE COURT: Let's try it again. He says, "I don't 20 recall." Would you like to show him something to refresh his 21 recollection? 22 MR. ARONWALD: Sure. 23 Q. I am showing you a transcript of your grand jury appearance 24 on April 8, 2008. Directing your attention to page 46/line 23 25 continuing on to page 47/line 7. Read that, please, to SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1142 C2RQANN5 Bender - Cross 1 yourself. Does that refresh your recollection? 2 A. Yes. 3 Q. So, it's true, is it not, that at that meeting, Mr. Jereis 4 did not express to you or the group, Forest City people, that 5 he could help you with the original project, correct? 6 A. In the context of that, that one sentence that you showed 7 me, there were several hours of, I think, testimony at the 8 grand jury, so if you're going to ask me to read that one 9 sentence, in the context you're correct, but I don't know what 10 I said afterwards or before that, so ... 11 Q. Having just read the lines I asked you to, isn't it true 12 that after the word "no" what you testified to is what Zehy 13 Jereis said at the meeting is "I am the Republican chairman" -- 14 MR. CARBONE: Objection. 15 THE COURT: What's the ground for the objection. 16 MR. CARBONE: It's just reading from the transcript. 17 THE COURT: Correct. And you can't do that. 18 Q. Did Zehy Jereis say at the meeting that he was the 19 Republican chairman; that he had done a number of -- 20 THE COURT: Let's do it one at a time. Did Zehy 21 Jereis say at the meeting that he was the Republican chairman? 22 THE WITNESS: Yes, ma'am. 23 THE COURT: Thank you. Did he say -- go to the next 24 one. 25 Q. Did he also say that he was on all of these campaigns? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1143 C2RQANN5 Bender - Cross 1 A. Yes. 2 Q. Did he also say, "I've done all of these things and you 3 guys just screwed up all of that"? 4 A. Yes. 5 Q. And he did not say that "I can help you," did he? 6 A. At that point in time he did not, but at -- towards -- I 7 mean -- 8 Q. At that point in time he did not say that he could help 9 you, isn't that so? 10 A. Correct. 11 Q. After the meeting on June 2, Mr. Jereis did arrange a 12 meeting to be held on June 9 with Sandy Annabi, correct? 13 A. Yes, sir. 14 Q. And present at that meeting were you, Richard Pesin, Scott 15 Cantone, Zehy Jereis and Sandy Annabi, correct? 16 A. Yes, sir. 17 Q. And the meeting was at Jake's Steakhouse, was it, or was it 18 Madisons? 19 A. What date was it, sir? 20 Q. June 9. 21 A. That was at Jake's. 22 Q. And that's located? 23 A. I believe on the Bronx/Yonkers border. I'm not that good 24 out there. 25 Q. And the meeting was in a public place? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1144 C2RQANN5 Bender - Cross 1 A. Yes. 2 Q. Right out in the open? 3 A. Yes. 4 Q. Now, the purpose of this meeting, as you understood it, was 5 for you to finally be able to sit down and talk to her 6 concerning the project and your respective positions, correct? 7 A. Yes, sir. 8 Q. And that during the meeting, each side, you on behalf of 9 Forest City, and Sandy conveyed your respective positions to 10 each other, correct? 11 A. Yes. 12 Q. One of the things that Sandy was concerned about was 13 traffic mitigation, correct? 14 A. Correct. 15 Q. She also wanted more tax dollars for the city of Yonkers, 16 correct? 17 A. Yes. 18 Q. And she also wanted help for the city of Yonkers education 19 fund, correct? 20 A. Yes. 21 Q. By the way, just getting back to what you said earlier, 22 when you met with John Murtagh, wasn't John Murtagh's principal 23 concern the traffic off of Tuckahoe Road into Ridge Hill? 24 A. The best that I could recall, John's main concern was the 25 pilot, it was more broader than that. He supported Ms. Dee SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1145 C2RQANN5 Bender - Cross 1 Barbato's position, but his issue was the transparency of the 2 pilot. 3 Q. And wasn't he also concerned with the fact that there were 4 no direct access roads from Tuckahoe Road into Ridge Hill, 5 which would cause traffic backups on Tuckahoe Road? 6 A. I can't recall exactly and only because the east side and 7 the west side alignment put the people from the Sprain on to 8 the alignment which bordered a portion of Tuckahoe Road, so -- 9 I'm not sure if I'm answering your question correctly. 10 Q. I am only asking for your recollection, so that's fine. 11 Now, at the conclusion of the meeting, Sandy Annabi did not 12 agree to support this project, did she? 13 A. No, not that I could recall. 14 Q. In fact, just focusing on the meeting itself, this meeting 15 started off very badly, didn't it? 16 A. Yeah, umm -- yes and no. I mean, just by sitting down with 17 a council member was a success, so you have to put everything 18 in perspective no matter what the outcome was. Just having an 19 opportunity to sit down and speak with her about the pluses and 20 minuses, an open debate on what her issues are, to me that was 21 a success. That's what, you know, it was supposed to be all 22 about. 23 Q. Do you recall being interviewed on June 26 of 2007 at the 24 United States Attorney's office in White Plains? 25 A. On June 26, what year? I'm sorry. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1146 C2RQANN5 Bender - Cross 1 Q. 2007. 2 A. I don't recall the exact date, but I'm not saying it didn't 3 happen. 4 Q. Well, do you recall saying at that meeting that when you 5 met with the agents or the United States Attorney's office, do 6 you remember telling them that that meeting on June 9 started 7 off bad, and Sandy said she didn't like being pressured? 8 A. I don't recall those exact words. I mean, you interpret, 9 you know, what bad is. I asked -- you know, the meeting opened 10 after my introduction, you know, with Miss Annabi was 11 worried -- 12 MR. CARBONE: Letting the witness finish his answer, 13 your Honor. 14 MR. ARONWALD: It's not responsive, your Honor. I'm 15 asking what he said at the time. 16 THE COURT: What did you say, sir? 17 A. I just asked -- I'm sorry, I just lost the whole train of 18 the thought here. 19 Q. Didn't you say at the meeting you had on June 26 of 2007 20 when you were relating what happened at the meeting on June 9 21 of '06, didn't you say that the meeting started off bad, and 22 Sandy said she didn't like being pressured? Didn't you say 23 that at that time? 24 A. I don't know if those were my exact words, but the fact of 25 the matter is that she had an altercation with Rich Pesin over SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1147 C2RQANN5 Bender - Cross 1 the issues, so things weren't going rosy, but there was a 2 discussion going on. 3 Q. Do you remember Sandy saying she didn't like being 4 pressured? 5 MR. CARBONE: Objection. 6 THE COURT: Overruled. 7 A. I might have said it -- 8 THE COURT: No. No. Did she say that to you? Yes or 9 no. 10 THE WITNESS: I believe she did. 11 MR. ARONWALD: Could I have a moment, please, your 12 Honor? 13 (Pause) 14 Q. Do you recall that you apologized to Ms. Annabi for the way 15 that Mr. Pesin acted at that meeting? 16 A. Yes. 17 Q. And how did he act at that meeting for which you 18 apologized? 19 A. Could you repeat the question? 20 Q. Why did you apologize? Strike that. What was it that 21 Mr. Pesin did or said at that meeting that you felt you needed 22 to apologize for? 23 A. The tone. 24 Q. Well, when you say the tone, was he confrontational with 25 her? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1148 C2RQANN5 Bender - Cross 1 A. You could, words -- it got confrontational between them 2 both. 3 Q. In what way? 4 A. Over the discussion of the amount of money we were 5 contributing as relates to tax dollars to the city of Yonkers. 6 Q. OK. She said she wanted more money for the city of 7 Yonkers. How did that generate into a confrontational exchange 8 between Ms. Annabi and Mr. Pesin? 9 A. It was the up and back, and a position on which they 10 weren't moving, you know, from their position that got a little 11 bit out of hand from a discussion perspective. 12 Q. The manner in which Mr. Pesin expressed his views led you 13 to believe that an apology was in order to Sandy Annabi for his 14 actions, correct? 15 A. It was correct with respect to the tone, but, moreover, is 16 that after several months of trying to get a meeting, what I 17 didn't want to happen is because -- you know, people were just 18 very ferocious in their ideas and what they wanted -- was for 19 Ms. Annabi to walk out, and then here's seven months of this 20 hard work of trying to get this meeting to just dissolve in a 21 second and she would have walked out, we would have been 22 nowhere again. 23 Q. So when you apologized to Ms. Annabi, what did she say? 24 A. I believe, you know, she accepted my apology. I believe 25 she was still very upset, but she accepted my apology. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1149 C2RQANN5 Bender - Cross 1 Q. In fact, during that meeting that occurred on June 9, Sandy 2 Annabi was not there for the entire meeting, was she? Didn't 3 there come a point when she left the meeting? She had to go to 4 work? 5 A. I don't know if it was -- if she -- if it was before or -- 6 if she left toward the end of it or she wasn't there at the 7 beginning of it. But one or the other, you're correct. 8 Q. Well, when the meeting first started, you told her that you 9 didn't understand why it took so long for her to be willing to 10 sit down and talk to you, isn't that so? 11 A. Yes. 12 Q. So she was there at the beginning of the meeting? 13 A. No. No. I don't know if she came with Mr. Jereis or they 14 came separately, and I don't know who got there first is what 15 I'm implying to you. 16 Q. Do you have any recollection that Sandy Annabi left before 17 the meeting ended and then soon after Richard Pesin left the 18 meeting? 19 A. I believe that's correct. 20 Q. Now, after the June 9 meeting, and before June 14, did you 21 have any discussions directly with Sandy Annabi concerning the 22 project? 23 A. I don't recall. 24 Q. You're not saying you didn't. You're just saying you don't 25 recall? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1150 C2RQANN5 Bender - Cross 1 A. Correct. 2 Q. Then the third meeting was on June 14, again at a public 3 restaurant, correct? 4 A. It was the second -- 5 Q. The June 14 meeting was you, Sandy Annabi, Zehy Jereis -- 6 A. It was the second -- 7 Q. Let's break it down. 8 A. Yeah. 9 Q. Your first meeting was on June 2; Sandy Annabi was not 10 there? 11 A. Correct. 12 Q. You had a meeting on June 9; Sandy Annabi was there? 13 A. Correct. 14 Q. You had another meeting on June 14; Sandy Annabi was there? 15 A. Correct. 16 Q. So that would be the second meeting you had with Sandy 17 Annabi. The third meeting you had with Zehy Jereis being 18 present? 19 A. Correct. 20 Q. So at the June 14 meeting, that's when Sandy Annabi agreed 21 to support the project because Forest City Ratner had addressed 22 some of her concerns, correct? 23 A. Yes, sir. 24 Q. Now, up to that point -- strike that. Throughout the 25 entire process up to and including her voting on July 11, 2006, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1151 C2RQANN5 Bender - Cross 1 Sandy Annabi never asked Forest City Ratner for anything of 2 value, isn't that so? 3 A. Correct. 4 Q. I'm sorry? 5 A. That's correct. 6 Q. In fact, the meeting of June 14 was really just to finalize 7 everything, isn't that so? 8 A. I think there was some loose ends, but you can characterize 9 it that way. 10 Q. In fact, after the meeting on June 9 -- strike that. 11 You reported directly to Bruce Ratner, correct? 12 A. Yes, sir. 13 Q. And do you know an individual by the name of Lovell, 14 L-O-V-E-L-L? 15 A. There's -- I knew somebody Lovell from the state senate, if 16 that's -- 17 Q. OK. Was Mr. Lovell at all involved with anything to do 18 with Ridge Hill? 19 A. No. 20 Q. Do you remember -- may I have this marked as -- 21 (Pause) 22 MR. ARONWALD: May I approach, your Honor? 23 THE COURT: You may. 24 BY MR. ARONWALD: 25 Q. I'm showing you what has been marked as Defense Exhibit 39. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1152 C2RQANN5 Bender - Cross 1 Would you just take a look at that and tell me when you have 2 finished reading it. Just to yourself. 3 (Pause) 4 Q. Do you recall that email? 5 A. Yes, I do. 6 Q. This is an email that you sent to Bruce Ratner concerning 7 the meeting you had on June 9 with Sandy Annabi, correct? 8 A. Partly. 9 Q. Well, part of this email has to do with the meeting that 10 you had with Sandy Annabi on June 9, correct? 11 A. Yes. 12 Q. OK. It also includes Mr. Ratner's response, correct? 13 A. Correct. 14 MR. ARONWALD: Move it into evidence, your Honor. 15 THE COURT: It's being offered, what's it marked 16 again? 17 MR. ARONWALD: This would be Defense Exhibit 39. 18 MR. CARBONE: No objection, your Honor. 19 THE COURT: Admitted. 20 (Defendant's Exhibit 39 received in evidence) 21 Q. I would like you, if you can, Mr. Turk, could you just 22 concentrate on the bottom part for now right where it says just 23 above the line from Bruce Bender. No, down below. If you 24 could just magnify that second half of the document. And you 25 can follow along on the screen in front of you, Mr. Bender? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1153 C2RQANN5 Bender - Cross 1 A. Thank you. 2 Q. So the part about Lovell, that had nothing at all to do 3 with Ridge Hill, correct? 4 A. Not at all. 5 Q. So if we could just blow up that second line, please, 6 Mr. Turk. The date of this is June 9 at 6:31 in the evening of 7 the year 2006, correct? 8 A. Yes, sir. 9 Q. The 18:31 is military time, so it's actually 6:31 in the 10 evening. 11 THE COURT: Is that correct? That has to be a 12 question. 13 THE WITNESS: I don't know. 14 THE COURT: You don't know. OK. So let's strike that 15 whole thing. 16 Q. Could we have the part we had. Mr. Turk, could we just 17 blow up the second paragraph? You can't do it any more? OK. 18 So you're telling Mr. Bender -- 19 A. Mr. Ratner. 20 Q. -- Mr. Ratner we had a good meeting with Sandy. We offered 21 10 mill, that means 10 million, correct? 22 A. Yes, sir. 23 Q. Over three years in tax dollars. We are 2 million short to 24 make the deal or 700,000 more for three years. I think we have 25 to make the deal. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1154 C2RQANN5 Bender - Cross 1 That's what you're telling Mr. Ratner, correct? 2 A. Yes, it is. 3 Q. OK. And that accurately reflected the discussion that you 4 had with Sandy Annabi during that June 9 meeting? 5 A. Yes. 6 Q. I'm showing you what's been marked as Defense Exhibit 39A. 7 A. Let me read the whole thing. 8 Q. This is a copy of the document I showed you which is 9 already in evidence, plus this portion over here which is not 10 in the document that's in evidence. 11 When you sent this email to Mr. Ratner at 18:31 hours 12 on the evening of June 9, 2006, did you get a response from 13 Mr. Ratner? 14 A. Yes. 15 Q. Within 20 minutes of your email to him? 16 A. Whatever that email says the response is. 17 Q. Then once you received that response from Mr. Ratner, you 18 then sent him another email which is in the top portion of the 19 Exhibit that's in evidence in which you say, "Thank you for 20 your confidence. Let's see if we can bring this home this 21 month. We may have to put some funds away for Lesnick and 22 traffic. There's a good chance this money will never be drawn 23 down." 24 Do you recall that? That's the email you sent to 25 Mr. Ratner after you received his response, correct? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1155 C2RQANN5 Bender - Cross 1 A. Yes. 2 MR. ARONWALD: Your Honor, we would move Defense 3 Exhibit 39A into evidence. 4 THE COURT: It's offered. 5 MR. CARBONE: Objection to the hearsay in the middle 6 of the document, your Honor. 7 THE COURT: Well, you want -- where? What line? 8 MR. ARONWALD: Judge, I'll hand it up to you. 39 is 9 in evidence. This would be 39A. 10 THE COURT: Give me 39. 11 THE DEPUTY CLERK: Do you have a copy of 39? 12 MR. ARONWALD: Yes. This would be 39, your Honor. 13 THE COURT: The objection is sustained. 14 Q. Your email to him, him being Mr. Ratner -- 15 THE COURT: Actually, you know what, the objection is 16 overruled. It's absolutely not possible to explain the certain 17 steps that we're taking subsequently without that being there; 18 therefore, it's not hearsay. I take that back. 19 (Defendant's Exhibit 39A received in evidence) 20 MR. ARONWALD: Could we put it back up on the screen, 21 please. 22 Q. So when you sent your first email to Mr. Bender -- 23 A. Mr. Ratner. 24 Q. I'm sorry, Mr. Ratner, Mr. Bender, you got a response from 25 Mr. Ratner saying that he agrees, correct? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1156 C2RQANN5 Bender - Cross 1 A. Yes. 2 Q. Now, you talked earlier about the fact that one of the 3 things that was discussed in order to address the traffic issue 4 was to reduce the size and scope of the Ridge Hill project 5 itself, correct? 6 A. Yes. 7 Q. And at one point Ms. Annabi indicated that one way to 8 address the traffic mitigation issue would be to reduce the 9 size of the project, the retail portion of the project by 30 10 percent, correct? 11 A. I don't know exactly which percentages were used, but there 12 was a discussion Ms. Annabi said, you know, again, there was a 13 matrix of reducing the size of the project, but I believe -- I 14 don't know if it was Dee Barbato who initiated it or Ms. Annabi 15 initiated or Mr. Murtagh. I know it was a discussion amongst 16 the three, but they all were in agreement with it. 17 Q. Do you recall whether it was Sandy Annabi who suggested a 18 30 percent reduction in the retail aspect of the project? 19 A. I don't recall. 20 Q. I'm showing you what has been marked as Government Exhibit 21 40 for identification. 22 MR. CARBONE: Defense Exhibit 40. 23 MR. ARONWALD: Defense Exhibit 40. Defense Exhibit 40 24 for identification, my colleagues at the government table 25 remind me. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1157 C2RQANN5 Bender - Cross 1 Q. Would you please take a look at what's been marked as 2 Defendant's Exhibit 40 for identification. Just read it to 3 yourself. Looking at Defendant's Exhibit 40 for 4 identification, does that refresh your recollection that you 5 were told that Sandy Annabi wanted a 30 percent reduction in 6 the retail part of Ridge Hill? 7 A. I don't recall that particular email, but according to that 8 email -- 9 THE COURT: No. No, not according to the email. 10 We're asking about your memory. Do you have any memory of 11 that? 12 THE WITNESS: I don't have memory of it. 13 THE COURT: OK. 14 Q. But the reduction in size of Ridge Hill was not something 15 that was an acceptable proposition simply because of the amount 16 of lost revenue to Ridge Hill as well as lost revenue to the 17 people of the city of Yonkers, correct? 18 A. Say that again? 19 Q. The idea or the concept of reducing the retail size of 20 Ridge Hill was something that Forest City Ratner was not 21 receptive to simply because it would result in a loss of 22 revenue to Forest City Ratner and a loss of tax revenue to the 23 people of the city of Yonkers, correct? 24 A. It sounds like there's two questions in there. 25 MR. CARBONE: Objection to form. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1158 C2RQANN5 Bender - Cross 1 THE COURT: Yes. 2 A. I'm sorry, I'm confused. 3 Q. Would a reduction -- I'm sorry, I'm withdrawing the 4 question. 5 THE COURT: Thank you. 6 Q. Would a reduction of 30 percent in the retail size of Ridge 7 Hill have resulted in any loss of revenues to Ridge Hill -- to 8 Forest City Ratner? 9 A. A 30 percent reduction would not have allowed us to build 10 that project. 11 Q. OK. As far as you were concerned, Mr. Bender, in your 12 experience, it's true, is it not, that as far as you were 13 concerned, you were the one who persuaded Sandy Annabi on the 14 merits to vote for this project and not Zehy Jereis, isn't that 15 so? 16 A. Mmm, I wouldn't take that credit. 17 Q. No? Well, when you testified before the grand jury, isn't 18 that exactly the credit you took? 19 A. I -- again, if you could refresh my memory. I don't recall 20 what context that was placed in there. 21 Q. I'm showing you page 62 of your April 8, 2008 grand jury 22 transcript beginning at line 2 and going through line 6. Would 23 you please read those lines to yourself and tell me when you've 24 finished. Are you finished? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1159 C2RQANN5 Bender - Cross 1 Q. Does that refresh your recollection that when you appeared 2 before the grand jury, you told the grand jury that you 3 persuaded her through the merits to vote yes for the project? 4 A. Yes, in that context, yes. 5 MR. CARBONE: Your Honor, might the Court have a five 6 minute stretch break? 7 THE COURT: I haven't had it in mind to have any such 8 break, Mr. Carbone. If somebody is desperate, let me know. I 9 am waiting for Mr. Aronwald to proceed. 10 Q. During this period of time leading up to July 11, 2006, the 11 unions were pressuring Sandy Annabi as well to vote for the 12 project, isn't that so? 13 A. Yes. 14 Q. Now, you were asked some questions on direct examination 15 about Government Exhibit 391C which was a -- if we could have 16 that put up on the screen, please. And if we could have the 17 bottom left-hand corner, if we could have that. 18 Now, this was the entry that you made for June 14, 19 2006, and it indicates 2:30 to 4:00 Friends of Yonkers 20 (Madisons, Riverdale Avenue). That's the meeting you were 21 referring to earlier that you had on June 14 at Madisons to 22 finalize the agreement with Ms. Annabi, correct? 23 A. Yes. 24 Q. And do you know who made this entry? 25 A. My assistant. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1160 C2RQANN5 Bender - Cross 1 Q. Did your assistant make this entry because this is the way 2 you told her the entry should read? 3 A. No. 4 Q. Well, was she at the meeting? 5 A. No. 6 Q. Who are the Friends of Yonkers? 7 A. I don't know how or why it was coded that way. I'm 8 assuming the Friends of Yonkers was just a meeting we're having 9 with whoever we had it that particular day. 10 Q. Well, that particular day at that particular time you 11 weren't meeting with the Friends of Yonkers; you were meeting 12 with counsel and Ms. Annabi and Zehy Jereis, isn't that so? 13 A. Correct. 14 Q. Do you know what the Friends of Yonkers are? 15 A. No, but I won't characterize -- 16 Q. Do you know what the Friends of Yonkers are? 17 A. No. 18 Q. OK. Could we have that thing now taken back to its full 19 size? This is your calendar for the period June 12 to June 18, 20 correct? 21 A. Correct. 22 Q. This is a document that is maintained and kept in the 23 regular and ordinary course of business of Forest City Ratner, 24 correct? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1161 C2RQANN5 Bender - Cross 1 Q. Accuracy is important, isn't it? Strike that. Can you 2 think of any reason why it would be necessary to put anything 3 in here that is not one hundred percent accurate? 4 A. Sometimes I -- sometimes things are coded on your calendar. 5 I don't check what's on the calendar. I know where I have to 6 go, so -- 7 Q. Mr. Bender, are you saying that this entry in which it 8 indicates that you were meeting with the Friends of Yonkers on 9 that date, are you saying that your secretary deliberately put 10 that in there rather than putting in Sandy Annabi's name and 11 Zehy Jereis's name? You're saying it's her fault? 12 A. I'm not saying it was her fault. I'm saying I don't recall 13 how it was placed in there, that's what I'm saying. 14 Q. But you agree that that meeting, that entry, was actually 15 with respect to a meeting that you had with Sandy Annabi and 16 Zehy Jereis, correct? 17 A. Yes. 18 Q. To the extent this does not indicate that, it's inaccurate, 19 correct? 20 A. Correct. 21 Q. By the way, at any time before, during or after you met 22 with Sandy Annabi on June 9 and again on June 14, did Sandy 23 Annabi ever ask you to conceal the fact that she was meeting 24 with you? 25 MR. CARBONE: Objection. Hearsay. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1162 C2RQANN5 Bender - Cross 1 THE COURT: The objection is sustained. 2 Q. Did Sandy Annabi ask you to put Friends of Yonkers in your 3 diary rather than -- 4 THE COURT: Sustained. 5 Q. -- Sandy Annabi -- 6 THE COURT: Sustained. 7 Q. Did you testified on direct examination that you were 8 uncomfortable with the idea of giving Zehy Jereis a job, 9 correct? 10 A. Correct. 11 Q. And you testified that you were uncomfortable because of 12 how it might look with respect to Sandy Annabi's changing her 13 vote, correct? 14 A. Well, at that point I don't think she changed her vote. 15 Q. No, please strike that. Please step closer to the 16 microphone. 17 A. I'm sorry. 18 Q. You were concerned -- I think you testified on direct, you 19 were concerned that if you told Zehy Jereis he wouldn't get a 20 job, that Sandy Annabi might not vote for the project on 21 July 11, isn't that what you said? 22 A. Yes. 23 Q. So when you went to Sandy Annabi and asked her whether or 24 not she would withdraw her support if she didn't give Zehy 25 Jereis a job, what did she say? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1163 C2RQANN5 Bender - Cross 1 MR. CARBONE: Objection. Argumentative. 2 MR. ARONWALD: It's a question. 3 THE COURT: Read back the question. 4 (Read back) 5 THE COURT: It didn't get transcribed correctly 6 somehow. Mr. Aronwald you need to re-ask the question. 7 MR. ARONWALD: Yes, I will. 8 Q. Did you ever ask Sandy Annabi whether her vote for the 9 project was dependent upon or contingent upon Forest City 10 Ratner hiring Zehy Jereis? 11 A. I never had a conversation with Sandy Annabi about that. 12 Q. It may be just because you're not comfortable in the chair, 13 but I'm having trouble hearing you hear? 14 THE COURT: Read the answer back, please. 15 (Read back) 16 THE COURT: Fine, next question. 17 Q. When you say about that, you mean about Zehy Jereis getting 18 a consulting position -- 19 THE COURT: About what you said. Mr. Aronwald, ask 20 the next question. The answer is very clear. 21 Q. Did you ever discuss with Sandy Annabi the fact that Zehy 22 Jereis had asked Forest City Ratner for any kind of job? 23 A. I can't recall that at all. 24 Q. When you say you can't recall that at all, is that the same 25 as saying it might have happened, but you don't know or you SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1164 C2RQANN5 Bender - Cross 1 just -- 2 A. No, I don't recall having that conversation with Sandy 3 Annabi. 4 THE COURT: Did you or didn't you -- 5 THE WITNESS: I'm sorry? 6 THE COURT: Did you have such a conversation? Yes or 7 no. 8 THE WITNESS: No. 9 Q. During all your discussions and meetings with Mr. Jereis -- 10 and, by the way, Sandy Annabi was never present at any meetings 11 or discussions that you had with Zehy Jereis about his seeking 12 a position with Forest City Ratner, isn't that true? 13 A. That's correct. 14 Q. And did you exchange any emails at all with Zehy Jereis 15 about a position at Forest City Ratner? 16 A. I can't recall, but I do not think so. 17 MR. ARONWALD: May I just have one moment, your Honor? 18 THE COURT: Yes. 19 (Pause) 20 MR. ARONWALD: No further questions, thank you. 21 THE COURT: Mr. Siano. 22 MR. SIANO: Thank you, Judge. 23 Judge, I need a moment to consult with Mr. Carbone. 24 THE COURT: Let's take a five minute break folks, and 25 I mean five. Don't discuss the case. Keep an open mind. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1165 C2RQANN5 Bender - Cross 1 (Recess taken) 2 (In open court; jury present) 3 MR. SIANO: May I proceed, your Honor? 4 THE COURT: Just a moment. You are still under oath, 5 sir. 6 Now you may. 7 CROSS-EXAMINATION 8 BY MR. SIANO: 9 Q. Good afternoon, Mr. Bender. My name is Anthony Siano. I 10 represent Zehy Jereis. Mr. Bender, you were asked some 11 questions at the end of your cross-examination about the line 12 item entries in your appointment book and this phrase Friends 13 of Yonkers. I take it this isn't the only time what was in the 14 appointment book didn't exactly line up with what was happening 15 in the real world. Is that a fair statement? 16 A. I wouldn't know. It could be. Could not be. 17 Q. Because you know where you are and your secretary needs to 18 know you need to be someplace? 19 A. Correct. 20 Q. And maybe they do line up and maybe they don't. All right. 21 I just wanted to clear that up. 22 I want to show you something, Mr. Bender. 23 MR. SIANO: May I approach, your Honor? 24 THE COURT: OK. 25 MR. SIANO: Is that in yet, 379? Excuse me, your SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1166 C2RQANN5 Bender - Cross 1 Honor, consulting with the government, obviously. 2 MR. CARBONE: Yes. 3 Q. I'm going to show you what's been received in evidence as 4 Government Exhibits 379. Mr. Turk, if I could impose upon you 5 to put 379 on the screen. Mr. Bender, do you recall sending 6 this email to Ms. Annabi on or about the evening of July 11, 7 2006? 8 A. No, actually, I don't recall, but I see the email. 9 Q. As you sit there now, what do you recall about the word 10 Longfellow? 11 A. I mean, the only thing I know about Longfellow is a project 12 in Yonkers. 13 Q. All right. And do you have an independent recollection as 14 you sit there now about seeing this exhibit when it was marked 15 FCR 17 in the grand jury back in April of 2008? 16 A. You can recollect my memory a little bit better if I can 17 see something, sir. 18 (Continued on next page) 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1167 C2RUANN6 Bender - cross 1 Q. I just have to ask you the preliminary question and the 2 answer is no, I take it? 3 A. Right. 4 Q. I place in front of you grand jury transcript of April 8, 5 2008. And in the interests of time, I take you back to, I 6 believe it is page 81 -- no. Excuse me one second. 7 It is page 81. 8 If you could take the time, sir, and just read from 9 page 81, line 11 -- and I do think it is necessary for you to 10 read the next three or four pages until you get to the end. 11 Take your time. 12 A. Is this my testimony? 13 Q. It does have your name there. You can look at the whole 14 thing if you want to, but I am trying to move it along. 15 (Pause) 16 Q. You have it just right, Mr. Bender, just right. Get to the 17 middle of page 84, Mr. Bender. 18 A. Yes, sir. 19 Q. Does that refresh your recollection about the subject 20 matter of Government Exhibit 379 which is displayed here on the 21 screen? 22 A. Yes, sir. 23 Q. Is it fair to say, sir, you didn't see that grand jury 24 testimony before I put it in front of you today, is that 25 correct? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1168 C2RUANN6 Bender - cross 1 A. Correct. 2 Q. You testified for the government in their grand jury 3 presentation in 08 and you didn't see that transcript until 4 today? 5 A. Yes, sir. 6 Q. Just clearing that up. 7 Now, having read that transcript, sir, do you recall 8 the context in which you became familiar with the word 9 "Longfellow"? 10 A. Yes, sir. 11 Q. And could you please share with us how that happened? 12 A. Yes. On the June -- the June 14th meeting at Madison's, we 13 were going over the press release with Ms. Annabi and she had 14 to leave to go to a council meeting, a meeting at city hall. 15 And I was kind of insistent upon her kind of staying with us 16 because we were just finalizing all of the details of her 17 support for Ridge Hill. 18 And she was insistent -- she wanted to leave and I 19 kind of in a nice way said, please won't you stay? 20 She said no, I've got to leave, it is very important, 21 something in my district. 22 I said, how can I help you? 23 She said, I can't miss the vote -- I don't know if it 24 was a vote or whatever the proceeding was, but it was very 25 important and in her district. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1169 C2RUANN6 Bender - cross 1 I read this quickly, you know, just now. 2 I asked who the meeting was with and she said Dennis 3 Robertson. Dennis Robertson said -- 4 MR. CARBONE: Objection. Hearsay. 5 THE COURT: Objection sustained. 6 Q. Is it your testimony, sir, that the word "Longfellow" was 7 brought to your attention by Ms. Annabi at the June 14th 8 meeting where you were going over the press release? 9 A. I believe so. 10 Q. Was it in reference to something she had pending somewhere 11 in city hall? 12 MR. CARBONE: Objection. Hearsay. 13 THE COURT: Objection sustained. 14 Q. Other than that reference in the grand jury in your answer 15 there, did you have anything at all to do with Longfellow? 16 A. No. 17 Q. In fact, this email that you sent was in fact an effort by 18 you, in your words, to bond with Ms. Annabi, isn't that right? 19 A. Yes. 20 Q. So when you said who did us wrong, that was sort of a 21 collegial us? 22 A. Yes. 23 Q. You can put that aside. 24 Now, you testified earlier on direct that you were 25 keeping Mr. Jereis at arm's length, pushing him off in the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1170 C2RUANN6 Bender - cross 1 period late June into early July. Do you recall giving that 2 testimony? 3 A. I thought I said between -- yeah, OK. 4 Q. In fact, sir, the reason you were doing that was because 5 the effort of five years of your life was pending before the 6 city council in Yonkers and that is Ridge Hill on July 11th, is 7 that right? 8 A. It was five years of collective teams. I don't know life, 9 that is a little dramatic -- 10 Q. Five years of effort? 11 A. Five years of effort by a lot of people. 12 Q. By a lot of people, and that's what your focus was, isn't 13 that right? 14 A. Yes. 15 Q. And that was the principal reason why you were holding Mr. 16 Jereis at bay? 17 THE COURT: Is that a question. 18 MR. SIANO: Yes, Judge. I'm asking him if that's the 19 principal reason. 20 THE COURT: It didn't sound like a question. 21 MR. SIANO: The hour is late, Judge, and I am failing 22 I apologize to the Court and the jury. 23 BY MR. SIANO: 24 Q. Is that the principal reason you were holding Mr. Jereis at 25 bay, sir? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1171 C2RUANN6 Bender - cross 1 A. Yes, sir. 2 Q. In fact, you didn't want to think about anything except the 3 vote on Ridge Hill? 4 A. Correct. 5 Q. After the vote on Ridge Hill, you -- just you -- continued 6 to talk to Mr. Jereis, isn't that correct? 7 A. Yeah -- yes, here and there, not on a daily basis, we 8 spoke. 9 Q. Here and there you continued to speak to Mr. Jereis, and 10 you continued to speak to him because he had evinced to you an 11 understanding of politics in Yonkers and Westchester County, 12 isn't that right? 13 A. Yes, sir. 14 Q. And Forest City Ratner continued to have an opponent of the 15 project, somebody who wouldn't be listed as friends of Yonkers 16 on the northern border of Ridge Hill, isn't that correct? 17 Mr. Finer? 18 A. Yes, he was an opponent of the project. 19 Q. And he continued to be an opponent of the project after 20 July 11th? 21 A. I am not sure of the dates because -- 22 MR. CARBONE: Objection. Relevance. 23 MR. SIANO: It is the continued interaction -- 24 THE COURT: Excuse me. The objection is overruled. 25 Q. He continued to be a foe of Ridge Hill after July 11th, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1172 C2RUANN6 Bender - cross 1 isn't that right? 2 A. I can't recall the exact date, but there was a point in 3 time in which we made a settlement with the town of Greenburgh, 4 Hastings, Ardsley and I think another town on the water in 5 which Mr. Finer collectively with that group was no longer 6 opponents of the project. So I am not sure of the date, the 7 date that you are referring to, but under the circumstances, 8 the point at which he was not an opponent of the project. 9 Q. But until he got his monetary settlement, he was still an 10 on opponent of the project? 11 A. I don't think it was a monetary settlement, sir. It was 12 about traffic, traffic improvements. 13 Q. Wasn't in fact there a lawsuit brought against the city of 14 Yonkers by Mr. Finer and some other people? 15 A. I would say probably, but that's not just what I do for the 16 company -- 17 MR. CARBONE: Objection. 18 THE COURT: Can we cut to the chase? 19 Was there a period of time during which Mr. Finer, a 20 supervisor of the town of Greenburgh opposed this project? 21 THE WITNESS: Yes. 22 THE COURT: Can we move on. There was such a period 23 of time. 24 Q. And that period of time included a period of time after 25 July 11, 2006? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1173 C2RUANN6 Bender - cross 1 A. Again, I can't recall the dates. You could check. It is 2 factual, out there, I just don't know. 3 Q. But it was a continued concern for Forest City Ratner? 4 A. Yes. 5 Q. Thank you. 6 And you continued to talk with Mr. Jereis about this 7 political issue as well as other political issues in Yonkers 8 and Westchester? 9 A. I can't recall talking to Mr. Jereis about Mr. Finer, per 10 se. I did discuss other things, like I can't pinpoint that I 11 spoke to Mr. Jereis about the issue of Mr. Finer. Mr. Finer 12 was a Democrat. Mr. Jereis is a Republican. War between them 13 both -- so I don't know how Mr. Jereis could have helped me 14 with Mr. Finer at that moment, but I am not sure. 15 Q. Let me show you two pieces of paper. Let me show the 16 government first, in terms of fixing the date. 17 Mr. Bender, if you could look at these two pieces of 18 paper. Read them to yourself. Don't read them out loud. 19 (Pause) 20 A. Got you. 21 Q. Does this reflect that in fact the issues with regard to 22 Greenburgh with Ridge Hill continued into January of 2007? 23 A. Yes. 24 Q. Thank you. 25 Do you recall that Mr. Jereis was tendered this SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1174 C2RUANN6 Bender - cross 1 consultancy by Forest City Ratner as of or effective August 1, 2 2006? 3 A. Yes. 4 Q. Are you the one that offered Mr. Jereis the job? 5 A. I don't believe so. 6 Q. Do you know who did? 7 A. The company did. 8 Q. I don't mean to be glib when I say that the company acts 9 through individuals, isn't that right? 10 A. The company is a collective, in a sense. 11 Q. But they didn't all come to Yonkers and offer him a 12 handshake, did they? 13 A. Well, we had a big party at Ridge Hill and everybody was up 14 there. 15 THE COURT: Fine. Is there some individual who you 16 can identify to us who is the person who offered Mr. Jereis the 17 consultancy? 18 THE WITNESS: Ultimately, you know, it is based on the 19 approval of Mr. Ratner. 20 Q. Ultimately, it is Mr. Ratner that offered Mr. Jereis the 21 job. 22 Now, was there a piece of paper evincing this job that 23 ultimately Mr. Ratner offered Mr. Jereis before the middle of 24 October, to your knowledge? He got a contract in mid October? 25 A. Correct. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1175 C2RUANN6 Bender - cross 1 Q. He didn't get a contract before then? 2 A. Correct. 3 Q. He got one check from the company, isn't that right? 4 A. Sir, I don't do the checks. You are asking the wrong 5 person these questions. 6 Q. Who should I ask? 7 A. Whoever does the accounting. I do the government relations 8 part. I don't do contracts. I wouldn't be truthful if I make 9 up an answer to you on that, sir. 10 Q. I didn't ask you to make up an answer, sir. 11 Are you aware of how many checks Mr. Jereis received? 12 A. No. 13 Q. Are you aware of how much money Mr. Jereis received? 14 A. Not really. 15 Q. I take it your answer would be the same. You are not aware 16 of Mr. Jereis receiving a dime from Forest City Ratner after 17 December 15, 2006, are you? 18 A. You are confusing me about the dates, sir. 19 Q. I gave you a specific date. Do you have any factual basis 20 to testify that Mr. Jereis received a dime from Forest City 21 Ratner after December 15, 2006? 22 MR. CARBONE: Asked and answered. 23 THE COURT: Overruled. 24 A. I don't know. 25 Q. Have you, sir, had occasion to actually see Forest City SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1176 C2RUANN6 Bender - cross 1 Ratner since that party and the ribbon-cutting you described -- 2 seen Ridge Hill, I'm sorry -- have you seen the project? 3 A. Yes, sir. 4 Q. Have you seen, Tuckahoe Road in its post opening 5 permutations? 6 A. No, sir. 7 Q. You haven't. 8 Have you seen the approach roads into the facility 9 from Tuckahoe Road? 10 MR. CARBONE: Objection. Relevance. 11 THE COURT: Overruled. 12 A. No, sir. 13 Q. So you testified earlier that in discussions with 14 Ms. Barbato, Forest City Ratner agreed to move the Tuckahoe 15 Road approach from what I will call the east side to the west 16 side of the site, is that right? 17 A. It is not an approach, an alignment, sir. 18 Q. The alignment, excuse me -- from the east side to the west 19 side? 20 A. Yes. 21 Q. Did you see that road after it was realigned? 22 A. I saw it from the top of Ridge Hill, not from the bottom of 23 Tuckahoe Road. 24 Q. It is a gigantic cut through a lot of rock, isn't it? 25 A. Yes, it is. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1177 C2RUANN6 Bender - cross 1 Q. Let me show you what's been previously marked as 2 Defendant's Exhibit Number 30, sir, and I ask you, do you 3 recognize this? 4 A. No. 5 Q. Thank you. 6 Now, at no time, sir, did Mr. Jereis demand anything 7 from Forest City Ratner, did he? 8 A. That's correct. 9 Q. And at no time, sir, did he in any way connect what 10 Ms. Annabi was doing to his resume, did he? 11 A. Correct. 12 Q. He never connected his desires and efforts to get a job 13 with Forest City Ratner to what Ms. Annabi was doing with you 14 up until July 11th, isn't that right? 15 A. That's correct. 16 Q. Through this period of time that you described you yourself 17 as holding him off, did ever raise his voice to you? 18 A. No. 19 Q. Did he ever express a demand of any kind? 20 A. No. 21 Q. Did he ever say to you, in words or phrases, I took care of 22 Ms. Annabi and you owe me anything? 23 A. No. 24 Q. He never did anything like that? 25 A. No, sir. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1178 C2RUANN6 Bender - cross 1 Q. With regard to the Joe Lentol meeting, you were in fact in 2 Pennsylvania when Assemblyman Lentol called you? 3 A. Correct. 4 Q. In words or phrases, in substance, he was needling you 5 about what he had heard about the project, isn't that right? 6 MR. CARBONE: Objection. Hearsay. 7 THE COURT: Objection is overruled. 8 Q. He was needling you? 9 A. I don't know, if you would use the word "needling," but, 10 again, what context he is needling me? 11 Q. He called to tell you that he was sitting down with someone 12 and they were telling him stories about how you were never 13 going to get Ridge Hill built and you got upset with it, isn't 14 that right? 15 MR. CARBONE: Objection. 16 THE COURT: Overruled. 17 A. Correct. 18 Q. That's correct, isn't it? 19 You were on vacation, isn't that right, at the time, I 20 believe that was, in Pennsylvania? 21 A. Yes, sir. 22 Q. Then you came back to the office and I think you described 23 yourself as cooler heads prevailed and you caused a meeting 24 with Mr. Lentol to be arranged, isn't that right? 25 A. Yes, sir. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1179 C2RUANN6 Bender - cross 1 Q. And your understanding was, Mr. Lentol was bringing his 2 friend with him, isn't that right? 3 A. He was bringing somebody -- but, yes. 4 Q. And that somebody was Joe Galimi, isn't that right? 5 A. Yes, sir. 6 Q. And that it was Mr. Galimi who brought Mr. Jereis to the 7 meeting? 8 A. That I do not know. 9 THE COURT: That's a good place, to stop, right? 10 MR. SIANO: Thank you, Judge. 11 THE COURT: Let's stop for the day, folks. I will see 12 you tomorrow. Don't discuss the case -- "discuss" in the 13 broadest sense of the term. Keep an open mind. 14 15 (Proceedings adjourned until February 28, 2012) 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1180 1 INDEX OF EXAMINATION 2 Examination of: Page 3 SCOTT CANTONE 4 Direct By Mr. Carbone . . . . .994 5 Cross By Mr. Aronwald . . . . .997 6 Cross By Mr. Siano ...... 1038 7 Redirect By Mr. Carbone . . . 1084 8 Recross By Mr. Aronwald . . . 1089 9 Recross By Mr. Siano . . . . . 1093 10 BRUCE BENDER 11 Direct By Mr. Carbone . . . . 1094 12 Cross By Mr. Aronwald . . . . 1118 13 Cross By Mr. Siano ...... 1165 14 GOVERNMENT EXHIBITS 15 Exhibit No. Received 16 440D ...... 993 17 DEFENDANT EXHIBITS 18 Exhibit No. Received 19 31 through 35 ...... 1045 20 36 ...... 1068 21 37 ...... 1073 22 38 ...... 1133 23 39 ...... 1152 24 39A ...... 1155 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1191

C2sQann1 TRIAL 1 UNITED STATES DISTRICT COURT 1 SOUTHERN DISTRICT OF NEW YORK 2 ------x 2 3 UNITED STATES OF AMERICA, 3 4 v. 10 CR 007 (CM) 4 5 SANDY ANNABI and ZEHY JEREIS, 5 6 Defendant. 6 7 ------x 7 8 New York, N.Y. 8 February 28, 2012 9 10:00 A.M. 9 10 10 11 11 Before: 12 12 HON. COLLEEN MCMAHON, 13 13 District Judge 14 14 15 APPEARANCES 15 16 PREET BHARARA 16 United States Attorney for the 17 Southern District of New York 17 JASON P.W. HALPERIN 18 PERRY A. CARBONE 18 Assistant United States Attorneys 19 19 WILLIAM I. ARONWALD 20 Attorney for Defendant ANNABI 20 21 ANTHONY J. SIANO 21 JEANNIE GALLEGO 22 Attorneys for Defendant JEREIS 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1192

C2sQann1 TRIAL 1 (Pages 1179-1188 SEALED by order of the Court) 2 (In open court) 3 THE DEPUTY CLERK: Case on trial continuing. The 4 government and defendants are present. The jurors are in the 5 jury room. 6 THE COURT: Thank you for anticipating side bars so 7 that we don't have to waste the jury's time. Now, let's get 8 the jury out here. 9 I forget, what are we doing? 10 MR. SIANO: Mr. Siano was still at the lectern, your 11 Honor. 12 THE COURT: Did you have a witness on the stand? 13 MR. SIANO: I believe Mr. Bender was on the stand. 14 THE COURT: How quickly I forget. That's correct. I 15 haven't checked my notes yet this morning, so I forget what 16 happened yesterday. 17 (Continued on next page) 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1193

C2sQann1 TRIAL 1 (Jury present) 2 BRUCE BENDER, 3 called as a witness by the Government, 4 having been previously duly sworn, testified further as 5 follows: 6 CROSS-EXAMINATION CONTINUED 7 BY MR. SIANO: 8 THE COURT: Good morning, everybody. OK, Mr. Bender, 9 you are still under oath. 10 Mr. Siano. 11 MR. SIANO: May I proceed, your Honor? 12 THE COURT: You may proceed. 13 MR. SIANO: Thank you. 14 Q. Mr. Bender, is it fair to say that Mr. Jereis never said to 15 you that access to Ms. Annabi was dependent upon you giving him 16 anything of value, isn't that right? 17 MR. CARBONE: Objection, hearsay. 18 THE COURT: The objection is sustained. 19 Q. At any time did Mr. Jereis ever demand anything from Forest 20 City Ratner in relation to Sandy Annabi? 21 THE COURT: The objection is sustained. 22 Q. Mr. Turk, if you could put up please 443, first page. 23 Mr. Bender, can you see that on the screen? 24 A. Not really, but I'll use my glasses. 25 THE COURT: Put your glasses on. It's amazing how SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1194 C2SQANN1 Bender - Cross 1 much it helps. 2 Q. Thank you, Mr. Turk. 3 Do you recognize Exhibit 443, Mr. Bender? 4 A. Yes, sir. 5 Q. What do you recognize it to be? 6 A. A contract. 7 Q. Is that in fact the contract that you were aware in 2006 8 was given to Mr. Jereis in or about October? 9 A. I'm not sure about the date, but, yes, it is. 10 Q. Are you familiar with the entity FC Acquisition Associates 11 LLC? 12 A. Not really. 13 Q. Other than on this contract, sir, other than on this 14 exhibit, have you ever seen the entity FC Acquisition 15 Associates LLC at any time during your employment at the Forest 16 City Ratner Companies? 17 A. I would not see it. That's not my function at the company. 18 Q. I didn't ask you what your functions were, sir. I merely 19 asked you have you ever seen this entity on any piece of paper 20 other than this contract? 21 A. No. 22 Q. Thank you. Mr. Turk, if you could please put up 352. 23 Mr. Bender, if you would be kind enough to look at 24 Government Exhibit 352. Do you recognize this document? 25 A. Yes, sir. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1195 C2SQANN1 Bender - Cross 1 Q. What do you recognize it to be? 2 A. Organization chart. 3 Q. Is that in fact the organizational chart for the Forest 4 City Ratner Companies as it existed during the period of your 5 employment with FCR? 6 A. I believe so. 7 Q. At any point on any such organizational chart did you ever 8 see the term FC Acquisition Associates LLC, sir? 9 A. No. 10 Q. All right. Did such an entity ever exist beneath your box 11 on the organizational chart? 12 A. No. 13 MR. SIANO: No further questions for Mr. Ratner. 14 Thank you, sir. 15 THE WITNESS: Thank you. 16 MR. SIANO: Excuse me, Mr. Bender. Thank you, sir. 17 THE WITNESS: Thank you. 18 MR. CARBONE: May I, your Honor? 19 THE COURT: Yes, Mr. Carbone. 20 REDIRECT EXAMINATION 21 BY MR. CARBONE: 22 (Pause) 23 THE COURT: OK, Mr. Carbone. 24 MR. CARBONE: Thank you, your Honor. 25 Q. Good morning, Mr. Bender. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1196 C2SQANN1 Bender - Redirect 1 A. Good morning. 2 Q. Now, Mr. Siano just asked you about FC Acquisition. What 3 is the parent company of Forest City Ratner? 4 A. Forest City Enterprises. 5 Q. Where is that headquartered? 6 A. In Cleveland, Ohio. 7 Q. And what is Forest City Ratner? 8 A. It's a sub of Forest City Enterprises, it's an SVU they 9 call it. 10 Q. It's a pretty substantial company? 11 A. Yes, sir. 12 Q. And do they sometimes -- 13 (Pause) 14 Q. Does the company sometimes set up many, many sub entities? 15 A. Yes, sir. 16 Q. And is that because that's the way business is -- 17 MR. ARONWALD: Objection, leading. 18 THE COURT: The objection is sustained. Please don't 19 lead. Not is that because. Ask him why. Why. 20 Q. Why? Why? 21 THE COURT: Good. Good. I have to train Mr. Carbone. 22 A. It's how they conduct, you know, the business of the 23 company. 24 Q. OK. Now, do you recall being asked by defense counsel 25 about Peter Finer and the town of Greenburgh? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1197 C2SQANN1 Bender - Redirect 1 A. Yes. 2 Q. Do you feel that Zehy Jereis or did you feel that Zehy 3 Jereis could help you in any way with Mr. Finer? 4 A. No. 5 Q. Did you ever ask him to help you with Mr. Finer? 6 A. No, I don't believe so. 7 Q. Why not? 8 A. Mr. Finer is a Democratic, kind of -- leader and elected 9 official in Greenburgh. Mr. Jereis was the Republican leader 10 or county chairman, I don't know the exact title, of Yonkers 11 and that just doesn't mix. 12 Q. You were asked a series of questions by Mr. Aronwald about 13 Melvin Lowe, who I think you testified Forest City Ratner hired 14 to consult, among other things, with Councilwoman MacDow. Do 15 you recall that? 16 A. Yes, sir. 17 Q. Do you have any idea of whether Mr. Lowe had paid for a 18 Mercedes Benz for Councilwoman MacDow? 19 A. No, sir. 20 Q. Do you know whether he had ever given her any other 21 financial benefits? 22 A. No, sir. 23 Q. You were asked a series of questions relating to your prior 24 testimony in the grand jury, do you recall that? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1198 C2SQANN1 Bender - Redirect 1 Q. Is it fair to say that you were asked many questions in the 2 grand jury? 3 A. Yes. 4 Q. About a variety of subjects? 5 A. Yes. 6 Q. Were you shown documents in the grand jury? 7 A. I believe so. 8 Q. Do you recall being asked by Mr. Aronwald very specific 9 snippets of your grand jury testimony? 10 A. Yes. 11 MR. ARONWALD: Objection to the characterization of 12 snippets, your Honor. 13 THE COURT: I don't think that's a pejorative term at 14 all, Mr. Aronwald. The objection is overruled. 15 Q. Do you recall that? 16 A. Yes, sir. 17 Q. Do you recall being asked whether Zehy Jereis told you at 18 the June 2 meeting whether he could be helpful in setting up a 19 meeting? 20 A. Yes. 21 Q. Do you recall Mr. Aronwald pointed to an answer you gave 22 where you said in substance that you didn't recall? 23 A. Yes. 24 Q. Did you clarify your testimony in the grand jury? 25 A. Yes, sir. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1199 C2SQANN1 Bender - Redirect 1 Q. What did you say? 2 A. Well, I was left with the impression that we're going to 3 have a follow-up meeting. 4 Q. Was Mr. Jereis in fact helpful in setting up that follow-up 5 meeting? 6 A. Yes. 7 Q. You said left with the impression. By whom? 8 A. By Mr. Jereis. 9 Q. Do you recall Mr. Aronwald asked you about a portion of an 10 answer you gave in response to a question on the subject of 11 whether you persuaded Ms. Annabi to support the project. Do 12 you recall that? 13 A. Yes, sir. 14 Q. Do you recall that Mr. Aronwald showed you only a portion 15 of your response? 16 A. Yes. 17 Q. Was your response a truthful response in the context in 18 which it was asked? 19 A. Yes. 20 Q. I want to show you page 50 of your grand jury testimony. I 21 want to ask you to look at line 15 through 17 and ask you 22 whether you told the grand jury that Mr. Jereis -- 23 MR. SIANO: Objection, your Honor. 24 THE COURT: The objection is sustained. 25 Q. What, if anything, did you tell the grand jury on the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1200 C2SQANN1 Bender - Redirect 1 subject of whether Mr. Jereis said he would be helpful in 2 setting up the meeting? 3 A. It was that he could set up the meeting. 4 Q. Now I want to direct your attention to page 62/line 4. Do 5 you recall that Mr. Aronwald had directed you to a portion of 6 that response? 7 A. Yes, sir. 8 Q. What, if anything, did you tell the grand jury on the 9 subject of whether Mr. Jereis was advocating for the project 10 and was helpful? 11 A. That's -- I said that. I said that while I had some input 12 in discussing the project, Mr. Jereis was advocating for the 13 project. 14 Q. And just how instrumental was Mr. Jereis in getting the 15 project approved? 16 A. I think he was very helpful. 17 Q. Do you recall being asked on cross-examination about 18 whether Sandy Annabi or Zehy Jereis ever directly asked you for 19 anything of value for Sandy Annabi? 20 A. Yes, I recall that. 21 Q. I want to direct your attention to the June 14 Madison's 22 meeting. What, if any, discussion did you have at that meeting 23 on the subject of whether Forest City Ratner would pay for 24 changes to Sandy Annabi's flight to Jordan? 25 A. There was a discussion as it related to the date of the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1201 C2SQANN1 Bender - Redirect 1 council meeting and that Ms. Annabi might not have been able to 2 make it because she got a -- she was scheduled to go on 3 vacation, and at that time there was a discussion that who 4 would pay the late fee or the penalty fee if she was not able 5 to take the flight. 6 Q. Well, when you say there was discussion, who raised the 7 issue? 8 A. I don't know if it was Ms. Annabi or Mr. Jereis, I can't 9 recall which one. 10 Q. It was one or the other? 11 A. Yes. 12 Q. And was Ms. Annabi present with Mr. Jereis, if it was 13 Mr. Jereis who raised the issue, was she present? 14 A. I believe so. 15 Q. What, if anything, did you say in response? 16 A. We could not do it. 17 MR. CARBONE: No further questions. Thank you. 18 RECROSS EXAMINATION 19 BY MR. ARONWALD: 20 Q. Mr. Bender, in response to Mr. Carbone's question a moment 21 ago, you said that Zehy Jereis had been helpful in getting the 22 project through. Do you recall that? 23 A. Yes, sir. 24 Q. By that, what you meant was that Zehy Jereis was helpful 25 because he was the one that provided access to Sandy Annabi for SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1202 C2SQANN1 Bender - Recross 1 you and Mr. Cantone and Mr. Pesin, isn't that correct? 2 A. He assisted in getting the meeting, that's correct. 3 Q. When you say he assisted in getting the meeting, who else 4 assisted in getting the meeting other than him? 5 A. He got the meeting. 6 Q. He got the meeting, didn't he? 7 A. Yes, sir. 8 Q. This was the meeting you were trying to get for over 14 9 months unsuccessfully, correct? 10 A. Correct. 11 Q. Through other individuals, such as Al Pirro, Mike Spano, 12 Nick Spano, correct? 13 A. Yes, sir. 14 Q. OK. And the fact is that without having the opportunity to 15 meet with her, you were unable to exchange your respective 16 views concerning the project, isn't that so? 17 A. Yes, sir. 18 Q. Isn't it so that without having access to her in the form 19 of being able to meet with her, you weren't able to persuade 20 her that this was a project that she should vote yea for, isn't 21 that so? 22 A. Yes, sir. 23 Q. By the way, I asked you some questions yesterday concerning 24 your grand jury testimony, correct? 25 A. Yes, sir. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1203 C2SQANN1 Bender - Recross 1 Q. That was grand jury testimony that you had given on 2 April 8, 2008, correct? 3 A. Yes. 4 Q. Almost four years ago, correct? 5 A. Correct. 6 Q. Now, before I showed you those portions of your grand jury 7 testimony yesterday, had you ever seen your grand jury 8 transcript? 9 A. No, sir. 10 Q. On how many occasions did you meet with the prosecutors 11 concerning your appearance before this jury yesterday? 12 A. A couple of times. 13 Q. At no time did Mr. Halperin, Mr. Carbone or any agent from 14 the FBI show you your grand jury transcript, did they? 15 A. No. 16 Q. OK. Mr. Carbone asked you about the conversation that you 17 had with Mr. Jereis and Mr. -- at the meeting with Mr. Jereis 18 and Ms. Annabi about when Mr. Jereis asked if you could -- 19 Forest City Ratner, not you personally -- Forest City Ratner 20 would be able to pay for the cancellation fee that she would 21 have to pay in order to delay her scheduled trip out of the 22 country so that she would be able to attend the city council 23 meeting, correct? 24 A. I don't remember who asked me. 25 Q. Somebody asked you, right? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1204 C2SQANN1 Bender - Recross 1 A. Yes. 2 Q. Forest City Ratner -- by the way, do you have any idea what 3 the cancellation fee would be? 4 A. No, sir. 5 Q. I mean, you've traveled in the past yourself? 6 A. Not really. 7 Q. Not really, OK. 8 A. Not a traveler. 9 Q. Certainly, the cancellation fee was not in the tens of 10 thousands of dollars as you understood it at the time, correct? 11 A. I wouldn't know. 12 Q. OK. But, in any event, you said no? 13 A. Yes, sir. 14 Q. Did Mr. Jereis or Ms. Annabi say, "Well, that's it, forget 15 about it, you're not getting our vote"? 16 A. No, sir. 17 Q. You were asked some questions by Mr. Carbone on redirect 18 concerning Mel Lowe, and concerning whether Mel Lowe ever asked 19 for any job or any other benefit in order to get Councilwoman 20 MacDow's vote, correct? 21 A. Yes, sir. 22 MR. CARBONE: Objection. I did not ask that question, 23 your Honor. 24 MR. ARONWALD: Well, your Honor, that's my 25 recollection what the question was. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1205 C2SQANN1 Bender - Recross 1 THE COURT: Why don't you just forget about whether 2 Mr. Carbone asked the question and ask whatever questions you 3 want. 4 Q. Are you familiar with a company known as Westchester 5 Invaders? 6 A. No, sir. 7 Q. Isn't it true that Forest City Ratner made a $10,000 8 contribution to Westchester Invaders at Councilwoman MacDow or 9 Mr. Lowe's request before the vote on Ridge Hill? 10 A. I can't recall that. I mean, it could be, but I don't 11 know. 12 Q. Who is Deidre Cahill? 13 A. She is my former executive assistant. 14 Q. Your former executive assistant? 15 A. Yes. 16 MR. ARONWALD: May I have a moment, your Honor? 17 (Pause) 18 MR. ARONWALD: May I approach, your Honor? 19 THE COURT: Yes. 20 BY MR. ARONWALD: 21 Q. Let me show you what's been marked as Defendant's Exhibit 22 41 for identification. Are you familiar with an individual by 23 the name of Tracey Fields? 24 A. No, sir. 25 Q. Do you know anything at all about the documents that I just SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1206 C2SQANN1 Bender - Recross 1 put before you? 2 A. No, sir. 3 Q. Never seen them before? 4 A. I don't recall ever seeing them before. 5 Q. OK. But Deidre Cahill was your executive assistant as of 6 July 11, 2006? 7 A. Yes, sir. 8 Q. I'm sorry? 9 A. Yes, sir. 10 MR. ARONWALD: May I just have a moment, your Honor? 11 THE COURT: Of course. 12 MR. ARONWALD: Your Honor, we would offer Defense 13 Exhibit 41. 14 MR. CARBONE: Objection. No foundation. Relevance. 15 THE COURT: Give me a copy. Objection sustained. 16 MR. ARONWALD: No further questions, your Honor. 17 Thank you. 18 (Continued on next page) 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1207 C2SUANN2 Bender - recross 1 RECROSS EXAMINATION 2 BY MR. SIANO: 3 Q. Mr. Bender, you were asked some questions by Mr. Carbone 4 about page 62 of your grand jury testimony. This is the 5 transcript I showed you during your cross yesterday, 3503A. 6 A. This is -- 7 Q. Well, you testified in the grand jury one time, isn't that 8 right, sir? 9 A. Yes, sir. 10 Q. And that appears to be the transcript you were looking at? 11 A. I didn't look at the number. 12 Q. I understand, I apologize for that. You can look at it 13 again and make sure that is you. Remember you said whose 14 transcript it is? 15 THE COURT: Is that the transcript of your testimony, 16 sir? 17 THE WITNESS: Yes, ma'am. 18 THE COURT: Thank you. 19 Q. Mr. Carbone asked you questions about that interaction you 20 had with the prosecutor in the grand jury on page 62 -- that's 21 why I put that little pink tab there so that we could save some 22 time. 23 A. Would you like me to read it? 24 Q. Read it to yourself, I don't want you to read it out loud. 25 I want to ask you some questions about that subject matter, and SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1208 C2SUANN2 Bender - recross 1 I want to give you the opportunity to see the transcript, sir. 2 That's the reason why I put it there? 3 A. Thank you. 4 THE COURT: Why don't you ask questions. If he needs 5 to refresh his recollection, he can consult the transcript. 6 Q. You were asked about this dynamic of who persuaded 7 Ms. Annabi to change or make her positive vote for the Ridge 8 Hill project, isn't that right? You were asked questions about 9 that? 10 A. Yes. 11 Q. You were asked questions about that there in the grand jury 12 on page 62, isn't that right? 13 A. Yes. 14 Q. In fact, sir, at the time you were meeting with Ms. Annabi 15 in June, you believed then that you persuaded her to vote for 16 Ridge Hill based on the merits of the project, isn't that 17 right? 18 A. I think it was a combination of a team effort, that 19 persuaded her. This was a collective effort by a lot of 20 people. I was one of those people. 21 Q. It was your belief that your persuasion, your team 22 persuaded her based on the merits of the project, is that 23 right? 24 A. Yes. 25 Q. And you said that to the grand jury, isn't that right? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1209 C2SUANN2 Bender - recross 1 A. I also said -- 2 THE COURT: Yes? 3 A. Yes. 4 Q. And you believe that as you sit there in the witness box in 5 front of these jurors today, isn't that right? 6 A. Yes. 7 Q. Thank you, Mr. Bender. 8 MR. CARBONE: I have one question, your Honor. 9 THE COURT: Yes. 10 MR. CARBONE: I am sorry. Are you finished, 11 Mr. Siano? 12 MR. SIANO: I am. 13 REDIRECT EXAMINATION 14 Q. Mr. Siano just showed you the grand jury transcript. What 15 else did you say in that response? 16 THE COURT: Go right ahead. 17 A. I said in that same sentence that Mr. Jereis was advocating 18 for the project at the same time. 19 MR. CARBONE: Thank you. 20 No further questions. 21 THE COURT: I think that you are finished. 22 (Witness excused) 23 THE COURT: Call your next witness. 24 MR. HALPERIN: Your Honor, the government calls John 25 Swagerty. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1210 C2SUANN2 Bender - redirect 1 JOHN SWAGERTY, 2 called as a witness by the government, 3 having been duly sworn, testified as follows: 4 DIRECT EXAMINATION 5 BY MR. HALPERIN: 6 Q. Good morning. 7 A. Good morning. 8 Q. How far have you gone in school? 9 A. I have a bachelor's degree and I have a master's degree. 10 Q. What field is the master's degree in? 11 A. It is in real estate -- master's in real estate with a 12 concentration in finance. 13 Q. Where are you currently employed, sir? 14 A. I work for Acadia Realty Trust. 15 Q. Where is Acadia Realty Trust located? 16 A. It is in White Plains, New York. 17 Q. How long have you worked there? 18 A. I have worked there for about a year. 19 Q. Before that time, where were you employed? 20 A. I worked for Forest City Ratner companies. 21 Q. How long did you work for Forest City Ratner? 22 A. I worked there for about eight and a half years. 23 Q. At the time you left Forest City Ratner, what was your 24 title? 25 A. I was a vice president in retail development. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1211 C2SUANN2 Swagerty - direct 1 Q. Starting from the beginning, what titles or positions did 2 you hold at Forest City Ratner? 3 A. When I started there in 2002, I was a project manager, 4 ultimately becoming a vice president. 5 Q. You mentioned that you were in the retail development 6 group? 7 A. Correct. 8 Q. Generally, what does the retail development group do at 9 Forest City Ratner? 10 A. Well, the retail development group would be in charge of 11 overseeing the development process for a large-scale retail 12 real estate project. So this would start off with securing a 13 site, negotiating, purchasing a site, going through the 14 necessary approvals to allow a retail real estate project, 15 overseeing the lease up of the project, overseeing the 16 construction of the project, the opening and all the while 17 watching the budget, projecting income and sort of monitoring 18 the investment criteria for the project. 19 Q. You mentioned lease up, what is a lease up? 20 A. That is just finding retail tenants to occupy the spaces 21 that we were building. 22 Q. Are you familiar with the Ridge Hill project? 23 A. Yes. 24 Q. When you worked at Forest City Ratner, did you work on the 25 Ridge Hill project? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1212 C2SUANN2 Swagerty - direct 1 A. I did, yes. 2 Q. What year did you begin working on the Ridge Hill project? 3 A. I started working on the Ridge Hill project when I started 4 in Forest City in 2002. 5 Q. How long did you work on it? 6 A. I worked on it until I left in 2011. 7 Q. Is Ridge Hill project now open? 8 A. Yes, it is. 9 Q. Let me direct you back to 2004 to 2006. Please describe 10 generally what the proposal was at that time for the Ridge Hill 11 project. 12 A. So we were proposing to build this project, the Ridge Hill 13 project. It was a large mixed use project in Yonkers with a 14 significant retail component. So that meant, to break it down, 15 it had about 1.2 million square feet of retail and retail 16 entertainment. That included all kinds of retail. That 17 included all kinds of retail. That included a movie theater 18 that included all of the restaurant s pace. That included 19 department stores. It included sort of large format retail as 20 well as like small inline stores as well. 21 Q. Break that down. Large format versus inline, just explain 22 those terms. 23 A. So inline retail would be the kind of stores like in the 24 mall between the department stores, like GAP or Ann Taylor Loft 25 or something like that. And large format would be like a SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1213 C2SUANN2 Swagerty - direct 1 department store or even something like they call it big box 2 container store, things like that. 3 Q. From 2002 through 2007, what were your responsibilities for 4 Forest City Ratner in relation to the Ridge Hill project? 5 A. I worked on the approvals of the project. We were seeking 6 a zone change to allow our project to be built. And there was 7 a pretty significant approval process associated with that 8 which I worked on pretty extensively. 9 Q. A zone change from which governmental entity? 10 A. We were seeking a zone change, and the Yonkers City Council 11 was the one who would approve that zone change. 12 Q. Did Forest City Ratner have to do an environmental impact 13 statement for the Ridge Hill project? 14 A. Yes. 15 Q. Were you involved in that project? 16 A. Yes. I oversaw the environmental impact statement for the 17 company. 18 Q. What did that entail? 19 A. Well, following the laws of the New York State SEQRA 20 process, we had to -- 21 Q. When you say SEQRA, what is that? 22 A. That is the State Environmental Quality Review Act. That 23 just meant that, in association with the rezoning that we were 24 proposing, we had to study all potential environmental impacts 25 associated with the zone change that we were proposing, so that SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1214 C2SUANN2 Swagerty - direct 1 meant that we had to study them and make sure that we were 2 aware of what the impacts were and we mitigated them to the 3 extent that we could. So this meant that we hired consultants 4 and planners to do a lot of work for it and we coordinated it. 5 And that meant that we studied air and noise impacts, traffic 6 impacts, visual impacts, impacts on city services, construction 7 impacts. Those were all what we studied in our draft 8 environmental impact statement that was done in connection with 9 the proposed zone change. 10 Q. I will just ask you to speak a little bit slower. 11 A. OK. 12 Q. What were the primary issues in relation to the 13 environmental impact statement for the Ridge Hill project? 14 A. The most important issue, the most controversial issue was 15 the traffic impact associated with the project because it was 16 big. There was also some concerns about impacts on city 17 services and other things like that, impacts on city services 18 and other things like that. Impact to city services, to the 19 extent that we would use those city services and what we would 20 give back in terms of tax revenues and tax generation. 21 Q. Now, from 2002 to 2007 when you worked on the Ridge Hill 22 project for Forest City Ratner to whom did you report? 23 A. My boss was Richard Pesin. 24 Q. And what was Richard Pesin's role at that time in Forest 25 City Ratner? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1215 C2SUANN2 Swagerty - direct 1 A. He was the executive vice president and the director of 2 retail development group. 3 Q. And in general which officials at Forest City Ratner dealt 4 with the public officials in Yonkers? 5 A. Bruce Bender and Scott Cantone and our government relations 6 office would have been working with the elected officials most 7 closely. 8 Q. And that was separate from your group, the retail -- 9 A. Yeah, we were separate. 10 Q. How much contact did you have with the public officials in 11 Yonkers? 12 A. I really didn't have any. Bruce and Scott wanted to make 13 sure that they were the only ones talking directly to the 14 elected officials. 15 Q. Let me direct your attention to 2005, 2007. Did you manage 16 or handle budgets and invoices for the project? 17 A. Yes. Part of what I worked on on the project was 18 overseeing the financials of the project which involved a 19 pretty extensive budget for the project. And I would oversee 20 the budget and part of that meant that, if we were hiring new 21 consultants or a vendor of some sort, that I would generally 22 approve the vendor, the amount and make sure that it was being 23 billed to the appropriate budget line. 24 Q. When you say the appropriate budget line, what does that 25 mean? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1216 C2SUANN2 Swagerty - direct 1 A. You know, it is a big project. It had a pretty extensive 2 budget. And the budget was just broken down to lots of 3 different line items. So I had to make sure that all the money 4 that we were spending was being appropriately allocated. 5 Q. In or about early 2006, what was the overall total budget 6 estimate for the cost of the project? 7 A. It was, in 2006 it was about $600 million. 8 Q. In 2005 did you attend Yonkers City Council meetings on the 9 Ridge Hill project? 10 A. Definitely. 11 Q. What was the reason that you attended such meetings? 12 A. Well, the meetings were important to the project. The 13 meetings were going to ultimately determine if the council was 14 going to approve this zone change, so I went just to make sure 15 that we knew what was happening at the meeting. 16 Q. I'm going to ask you, sir -- in front of you you have a 17 Redweld folder, if you could pull out what is marked for 18 identification as Government Exhibit 389A. Do you recognize 19 this document? 20 A. Yeah. 21 Q. What do you recognize it to be, sir? 22 A. It is an email that I sent to some executives at Forest 23 City. 24 Q. What is the date of the email? 25 A. The date is Tuesday, June 14, 2005. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1217 C2SUANN2 Swagerty - direct 1 Q. Don't read the substance yet, but what is the subject line 2 of the email? 3 A. The subject line says "tonight's council meeting." 4 Q. Does the email relate to the Ridge Hill project? 5 A. Yes, it does. 6 MR. HALPERIN: The government offers 389A into 7 evidence. 8 THE COURT: Any objection? 9 MR. ARONWALD: I want to take a quick look at it, your 10 Honor. 11 No objection, your Honor. 12 MR. SIANO: No objection, your Honor. 13 THE COURT: Received. 14 (Government Exhibit 389A received in evidence) 15 MR. HALPERIN: It is received? 16 THE COURT: Yes. I said the magic words. 17 MR. HALPERIN: Mr. Turk, could we please have 389A on 18 the monitor. 19 BY MR. HALPERIN: 20 Q. Again, mr. Swagerty, who is the email from? 21 A. The email is from me. 22 Q. The date? 23 A. June 14, 2005. 24 Q. The people on the "to" line are generally people from 25 Forest City Ratner? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1218 C2SUANN2 Swagerty - direct 1 A. Yeah. 2 Q. Bruce Bender, Scott Cantone, Richard Pesin? 3 A. Correct. 4 Q. Could you read the email aloud? 5 A. "Tonight's council meeting was not so good. Council 6 President Martinelli announced that the zoning public 7 hearing" -- 8 Q. Slow down a little bit. 9 A. "Council President Martinelli announced that the zoning 10 public hearing would be held on July 7th and then this was 11 followed by Council Members Barbato, Murtagh and Sandy Annabi 12 speaking publicly for the record that they were not contacted 13 to set the hearing on this date, that they did not support this 14 action and that they were upset that the issue was conducted in 15 this manner." 16 Q. Now, let me direct your attention to the second line of the 17 text. Why did you write the word "and" in all capital letters 18 before Sandy Annabi's name? 19 A. I wrote that because, again, we were constantly monitoring 20 the council members who seemed to be in favor of the rezoning 21 and who seemed to be most likely inclined to oppose it so. 22 That was important just to understand. 23 In this case it was significant because, well, there 24 are seven members of the city council, so to pass the zone 25 change, we would have needed four members to approve it. But SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1219 C2SUANN2 Swagerty - direct 1 we knew that there was a possibility, based on the 2 recommendation from the Westchester County planning board that 3 if that recommendation was negative, that we would need a super 4 majority of the council to approve the zone change so that 5 meant that we would have needed five council members. So here, 6 if three of them are seeming like they do not support the 7 project, that was an issue and that was significant. 8 MR. HALPERIN: Thank you, Mr. Turk. 9 Mr. Turk, if we could pull up 374 which the Court has 10 already received into evidence. 11 Q. Sir, do you recognize this email? 12 A. Yep. 13 Q. Who sent it? 14 A. I did. 15 Q. On what date? 16 A. On Monday, May 8, 2006. 17 Q. To whom? 18 A. It was sent to Al Pirro. 19 Q. What was his connection to the Ridge Hill project? 20 A. He was a lobbyist and a consultant for the project. 21 Q. Who did you CC? 22 A. I copied Bruce Bender. 23 Q. Subject line? 24 A. "Ridge Hill." 25 Q. What is the first document attached? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1220 C2SUANN2 Swagerty - direct 1 A. Annabi decision 5/2/06. 2 Q. Could you read the text? 3 A. "Al, attached please find Judge Colabella's decision and 4 the letter from Bob Dennison of DOT. Let me know if you need 5 anything else." 6 Q. What was the date there on the first attachment of Judge 7 Colabella's decision? 8 A. 5/2/06, May 2nd. 9 Q. After Judge Colabella's decision came down on May 2, 2006, 10 how many votes did you need for the zoning change for the Ridge 11 Hill project to be approved? 12 A. That meant that we needed a super majority, so we needed 13 five council members to support the rezoning. 14 Q. During 2005 and early 2006, how easy or hard had it been 15 for Forest City Ratner to get five supporters on the council 16 for the project? 17 A. It had been challenging. 18 Q. Let me direct your attention to June 2006. Do you recall 19 Councilwoman Annabi issuing a press release saying she would 20 now support the project? 21 A. Yes, I do. 22 Q. How much additional money did Councilwoman Annabi say she 23 had obtained from Forest City Ratner? 24 A. $10 million. 25 Q. On a percentage basis, about what percent was the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1221 C2SUANN2 Swagerty - direct 1 additional $10 million in relation to the total cost of $600 2 million? 3 A. 1 and 1/2 percent, total cost. 4 Q. 1 and 1/2? 5 A. 1 and 1/2 percent. 6 Q. When Annabi announced her support for the project in June 7 2006, what if any changes had been made in the previous few 8 months to the project's plan regarding traffic? 9 A. None. 10 Q. When Annabi announced her support of the project, what if 11 any changes had been made in the previous few months to the 12 projects plan regarding environmental issues? 13 A. None. 14 MR. HALPERIN: Thank you, Mr. Turk. 15 Q. At some point after Councilwoman Annabi voted in favor of 16 the project, did Zehy Jereis receive a consulting contract from 17 Forest City Ratner? 18 A. Can you repeat that? 19 Q. At some point after Councilwoman Annabi voted in favor of 20 the project, did Zehy Jereis receive a consulting project from 21 Forest City Ratner? 22 A. Yes. 23 Q. Was that in or about the fall of 2006? 24 A. Yes. 25 Q. During the fall of 2006, did you receive and review an SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1222 C2SUANN2 Swagerty - direct 1 invoice from a company called ZJ Enterprises? 2 A. Yes. 3 Q. Who was the principal of ZJ Enterprises? 4 A. Zehy Jereis. 5 Q. Let me show you please -- 6 MR. HALPERIN: Mr. Turk, can we display 428 which the 7 Court has received into evidence. 8 Q. Mr. Swagerty, who submitted this invoice to Forest City 9 Ratner? 10 A. Zehy Jereis. 11 Q. What is the date on that email? 12 A. Friday, October 13, 2006. 13 Q. And the subject line? 14 A. "Invoice." 15 Q. And the attachment, what does it say? 16 A. "Invoice August, September '06." 17 MR. HALPERIN: Mr. Turk, page 2, please. 18 Q. What is the company name there listed? 19 A. ZJ Enterprises. 20 Q. The address? 21 A. 17 Robbins Place, Yonkers, New York. 22 Q. Again, who was the owner of ZJ Enterprises? 23 A. Zehy Jereis. 24 Q. What was the reason that you had to review this invoice? 25 A. As I mentioned, I oversaw the budget for the project and it SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1223 C2SUANN2 Swagerty - direct 1 was pretty common for me to review invoices, soft cost invoices 2 and just make sure that they were coded properly to the 3 appropriate budget lines and often to make sure that they had 4 the necessary information that my accounting department would 5 need to approve and pay the invoice. 6 Q. You mention the soft costs. What is soft costs versus hard 7 costs? 8 A. Hard costs are construction costs, and soft costs are 9 basically anything else. So things like lobbyists, consultants 10 that are not construction-related costs were soft costs that I 11 would have overseen. 12 Q. Who within Forest City Ratner gave you this invoice for 13 your review? 14 A. Scott Cantone. 15 Q. How would you describe the quality of the invoice you 16 received from Mr. Jereis? 17 A. It struck me as a little unprofessional. I think I used 18 the word "JV" to describe it. 19 Q. What do you mean JV? 20 A. Junior varsity, kind of unprofessional. 21 Q. What makes you say that? 22 A. Well, typically, invoices would have more information on 23 this. They would be billed to a particular entity. They would 24 include some information about what they were billing for. 25 This just seemed very simple and didn't have a lot of SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1224 C2SUANN2 Swagerty - direct 1 information. 2 Q. What if any information might be included about the work 3 that a consultant had done? 4 A. Yes. Sometimes the invoices would include what had been 5 completed are what product had been produced in the previous 6 end of the billing period. 7 Q. When you received this invoice, did you process it or did 8 you do something else with it? 9 A. Actually, I kicked it back to Scott Cantone and told him 10 that I needed to see more information on it before I could 11 approve it and sent it down to the accounting department to be 12 processed for payment. 13 MR. HALPERIN: Thank you, Mr. Turk. 14 Q. At some point did you review monthly reports submitted by 15 Zehy Jereis? 16 A. Yes. 17 Q. What month and years did you review Jereis' monthly 18 reports? 19 A. I received them in March of 2007. 20 Q. Did Mr. Jereis' monthly reports include a list of 21 properties? 22 A. Yes. 23 Q. And for what purpose was he including these properties? 24 A. Part of his contract was that he was going to find or help 25 us find development sites in Westchester and the northern SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1225 C2SUANN2 Swagerty - direct 1 suburbs, so he produced a list of potential development sites. 2 MR. HALPERIN: Mr. Turk can we display 449 which the 3 Court has received. Let's start with page 1. Why don't you 4 just maximize the top half of the page. 5 Q. Sir, do you recognize this document? 6 A. Yeah. 7 Q. And what is this document? 8 A. This is a report that I wrote after investigating the 9 potential development sites submitted to us from ZJ 10 Enterprises. 11 Q. Are there any attachments to the report? 12 A. Yeah. 30 or 40 pages of photographs and information that I 13 collected about each of the development sites. 14 Q. Who took the photographs? 15 A. I did. 16 Q. Why don't you tell us what you did to go about creating 17 your report? 18 A. Like I said, I received a list of potential development 19 sites. 20 Q. From whom? 21 A. From ZJ Enterprises. 22 Q. These were properties that Mr. Jereis had proposed? 23 A. These were properties that Mr. Jereis had proposed as being 24 potential development sites that Forest City Ratner would be 25 interested in undertaking. So I performed some initial due SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1226 C2SUANN2 Swagerty - direct 1 diligence. I visited each of the sites. I accessed them. I 2 took photographs of them. I found out how big the property 3 was, if there was any easily accessible zoning information, 4 that sort of thing, and I compiled it in this report. 5 Q. What are the typed words in the upper left corner of page 6 1? 7 A. It says, "Retail Hunting, ZJ Enterprise Site Research, 8 March 20, 2007." 9 Q. Was that the date that you prepared the report? 10 A. Yes. 11 Q. March 20, 2007? 12 A. Correct. 13 Q. What does the handwriting say at the top of page 1? 14 A. It says "Report by John Swagerty." 15 Q. Who is handwriting is that? 16 A. That was Rich Pesin's handwriting. 17 Q. Your boss? 18 A. My boss at the time. 19 Q. And whose handwriting next to the various properties? 20 A. That is also Rich Pesin's handwriting. 21 Q. Can you please read the first line of text on page 1? 22 A. "I have visited the following sites in Riverdale and 23 Westchester County on March 16, 19 and 20, 2007. These sites 24 were provided to us via ZJ Enterprises." 25 Q. Again, who was the owner of ZJ Enterprises? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1227 C2SUANN2 Swagerty - direct 1 A. Zehy Jereis. 2 Q. So you spent three days in mid March 2007 going out and 3 visiting these sites? 4 A. Correct. 5 Q. Who instructed you to do this assignment? 6 A. My boss, Rich Pesin, and Bruce Bender. 7 Q. Just briefly take us through what you did when you went out 8 and reviewed these sites. You would go to a site and what 9 would you do? 10 A. Like I said, it was mostly visual inspection, checked out 11 the sites, took some pictures, tried to determine what were the 12 adjacent uses, if retail was appropriate, access, roads, 13 visibility, just basic stuff. 14 Q. How many sites were listed in Jereis' monthly report? 15 A. I think there were 18 sites. 16 Q. Out of those 18 or so sites, how many did you include in 17 this report? 18 A. 13. 19 Q. Is that the number that you visited? 20 A. Yeah, yeah. 21 Q. How many of the properties you visited had for sale signs 22 up on them? 23 A. I think one of them had a for sale sign. 24 Q. One out of the 13? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1228 C2SUANN2 Swagerty - direct 1 Q. How many of the sites were residential versus retail 2 commercial locations? 3 A. A number of them seemed better residential sites, probably 4 five or six of them. 5 Q. When you conducted your visits were the sites the types of 6 sites that Forest City Ratner would have an interest in 7 pursuing? 8 A. Generally, no. 9 Q. Why not? 10 A. The sites that were appropriate for retail were small. 11 They were, like, for example, one was an empty gas station or 12 something that was a former fast food restaurant. So these 13 properties would be small, an acre, an acre and a half. That 14 is just a small development. Forest City Ratner is a big 15 company. We undertake big projects like the Ridge Hill project 16 and we wouldn't have an interest in something of this scale. 17 Q. Let me direct your attention to page 2 of your report. 18 MR. HALPERIN: Mr. Turk, if we could please have that 19 up, and let's maximize the top third of the page, please. 20 Q. Can you read the first one on page 2, please? 21 A. Yes. "Site number Greenburgh, Scarsdale, Site number 7, 22 100 Spring Valley Road at Old Jackson Avenue, residential 23 home." 24 Q. Would a residential home be the type of the site that 25 Forest City Ratner would want to develop? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1229 C2SUANN2 Swagerty - direct 1 A. No. 2 Q. During your time at Forest City Ratner, had Forest City 3 Ratner ever developed something the size of a stand-alone 4 retail store like a CVS? 5 A. Not while I was there, no. 6 Q. When you visited the sites, what did you learn about 7 whether any had been sold already? 8 A. I learned that a couple of them had recently turned out 9 that they had been sold. 10 Q. They had already been sold? 11 A. Yeah. 12 Q. Let me direct your attention again to your report. 13 MR. HALPERIN: And, Mr. Turk, we can go back to page 14 1, please. 15 Q. Next to how many of the 13 properties was the word "pursue" 16 written? 17 A. Only one. 18 Q. That's for site number 1 at the top? 19 A. Yes. 20 Q. Please read the description of site number 1. 21 A. "Yonkers, Site number 1, 365 Kimball Ave at Yonkers Ave, 22 empty Exxon station." 23 Q. In your almost nine years at Forest City Ratner, how many 24 times have known the company to develop something the size of a 25 gas station lot? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1230 C2SUANN2 Swagerty - direct 1 A. None, zero times did they endeavor to develop such a site. 2 Q. Based on your time at Forest City Ratner, is a site the 3 size of a gas station something that Forest City Ratner would 4 have an interest in pursuing? 5 A. No. 6 Q. As far as you know, what if any steps were taken by Forest 7 City Ratner to pursue this property at site number 1? 8 A. I don't think any steps were taken to pursue the site. 9 Q. Thank you, sir. 10 MR. HALPERIN: Nothing further. 11 CROSS-EXAMINATION 12 BY MR. ARONWALD: 13 Q. Good morning, Mr. Swagerty. 14 How are you? 15 A. Good morning. 16 Q. I asked this question of every witness, so don't take it 17 personally. 18 You and I have never met, correct? 19 A. We have never met. 20 Q. Did you ever meet Sandy Annabi? 21 A. Not directly, no. 22 Q. When you say "not directly," I mean, you attended meetings 23 at which she was present? 24 A. I attended meetings at which she was present, but I don't 25 think that we were ever formally introduced. We didn't have a SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1231 C2SUANN2 Swagerty - cross 1 relationship. 2 Q. The fact of the matter is, to the extent there were ever 3 any meetings between any representative of Forest City Ratner 4 and Sandy Annabi, those meetings did not include you? 5 A. Correct. 6 Q. In fact, you were never ever even invited by Mr. Bender or 7 Mr. Cantone or Mr. Pesin to ever sit down and attend any 8 meeting they were having with Sandy Annabi relating to the 9 Ridge Hill project, correct? 10 A. That's correct, I was not invited. 11 Q. You were not insulted by that? 12 A. I wasn't offended by that. 13 Q. I would like to direct your attention -- first of all, with 14 respect to Government Exhibit 374 -- 15 MR. ARONWALD: If we could have that put back up 16 again. 17 Q. Now, this memo relates to the decision that was issued by 18 Westchester County Supreme Court Justice Nicholas Colabella in 19 a lawsuit that was brought by Sandy Annabi as the lead 20 plaintiff, John Murtagh, Dee Barbato and a number of other 21 individuals to challenge and vacate the vote of the Yonkers 22 City Council to overturn the super majority requirements, isn't 23 that so? 24 A. Correct. 25 Q. The purpose of this memo was to send Mr. Pirro a copy of SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1232 C2SUANN2 Swagerty - cross 1 Judge Colabella's decision because Mr. Pirro was a paid 2 lobbyist/consultant for Forest City Ratner in May of 2006 3 relating to the Ridge Hill project? 4 A. Yes, correct. 5 Q. Did you have anything at all to with negotiating the 6 contract between Forest City Ratner and Mr. Pirro? 7 A. No. 8 Q. Did you ever see any contract between -- 9 A. Yeah, I definitely saw it, but I didn't negotiate it. 10 Q. Was it your understanding that Mr. Pirro was specifically 11 hired as a consultant/lobbyist to target the votes Sandy 12 Annabi, Dee Barbato and John Murtagh? 13 A. Not necessarily. I think he was just a lobbyist. 14 Q. Were you aware at any time that he had been specifically 15 tasked by Mr. Bender or Mr. Cantone to get Sandy Annabi, Dee 16 Barbato or John Murtagh to cast that fifth necessary vote? 17 MR. HALPERIN: Objection. Beyond the scope. 18 THE COURT: Objection sustained. 19 MR. ARONWALD: Your Honor, would you direct the 20 witness that he is subject to recall at the end of the 21 government's case? 22 THE COURT: The witness is subject to recall at the 23 end of the government's case. 24 MR. ARONWALD: Thank you. 25 With respect to Government Exhibit 389A, if we could SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1233 C2SUANN2 Swagerty - cross 1 have that back up. 2 BY MR. ARONWALD: 3 Q. From this memo, is it correct that you attended that June 4 14, 2005 city council meeting? 5 A. Yep, yes. 6 Q. Because you copied this memo to Bruce Bender and Scott 7 Cantone and Richard Pesin, does that mean that none of them 8 were at that meeting? 9 A. Correct. 10 Q. Was any other representative of Forest City Ratner present 11 at the June 14, 2005 Yonkers City Council meeting? 12 A. I don't think so. 13 Q. Do you recall insofar as Ridge Hill was concerned, what was 14 the purpose of the June 14, 2005 city council meeting? 15 A. I believe that the purpose of that meeting was to just set 16 the dates for the -- for the next public hearing on the 17 project. 18 Q. So when you say that tonight's council meeting was not so 19 good, would it be correct to say that tonight's council 20 meeting, insofar as the Ridge Hill project was concerned, was 21 bad, bad, bad? 22 A. Yeah, OK. You could say that. 23 Q. I'm sorry? 24 A. Yeah, you could say that. 25 Q. You testified that $10 million represented approximately 1 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1234 C2SUANN2 Swagerty - cross 1 and 1/2 percent of the total cost of the project, correct? 2 A. Correct. 3 Q. That $10 million was to be paid to who? 4 A. It was to be paid directly to the city of Yonkers during 5 the construction period of the project when the site wouldn't 6 otherwise have been generating any tax revenues to the city. 7 Q. The city of Yonkers, you mean the people of the city of 8 Yonkers, correct? 9 A. Yeah, yeah. 10 Q. And, again, you were instrumental in preparing the 11 environmental impact report that was to be submitted to the 12 Westchester County planning board, correct? 13 A. Well, actually the environmental impact statement was 14 submitted to the council because they were the lead agency and 15 then another board received copies of it as part of their 16 review. 17 Q. You understood at the time that you were preparing the 18 environmental impact study report that ultimately that report 19 was going to have to be reviewed by the Westchester County 20 planning board because county park land abutted -- 21 A. Correct. 22 Q. -- the site of the Ridge Hill project? 23 A. Yeah. There were a number of agencies aside from the city 24 council that would review it and they were one of them. We 25 knew that. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1235 C2SUANN2 Swagerty - cross 1 Q. But the only agency that actually would determine whether 2 or not -- strike that. 3 Only the action of the Westchester county planning 4 board would determine whether or not the super majority 5 requirement was necessary? 6 A. Correct. Yes. 7 Q. The environmental impact study that you prepared just 8 related to issues relating to the environment and the impact 9 that the project would have on the environment, correct? 10 A. Yep. Yes. 11 Q. So the report that you prepared did not in any way relate 12 to the financial aspects of the project in terms of tax 13 revenue, sale taxes or anything along those lines? 14 A. Actually, that is not correct. When we say it was an 15 environmental impact statement, it reviewed a lot of impacts of 16 the project, even extending into impacts on city services. And 17 part of that was to assess how much city services we would be 18 using and how much tax revenues we would be generating to kind 19 of determine what the sort of net impact of the city of Yonkers 20 would have been. 21 MR. ARONWALD: Could I see Government Exhibit 355, 22 please. 23 I will hand the witness my copy. 24 Q. Showing you what's been marked as Government Exhibit 355 25 and before you actually take a look at it, let me ask you a SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1236 C2SUANN2 Swagerty - cross 1 preliminary question. 2 A. OK. 3 Q. First, do you recognize the document, Government Exhibit 4 355? 5 A. Yep, I do. 6 Q. Would it be fair to say that, although the environmental 7 impact study that you prepared and submitted to the city 8 council which was then submitted to the Westchester County 9 planning board may have related to the impact upon city 10 services that the project would have, isn't it correct that the 11 Westchester County planning board's report only addresses the 12 environmental impact aspects of it and not the financial 13 aspects of it? 14 And if you don't know the answer to that, please take 15 a look at the exhibit. You can read it to yourself and when 16 you have finished, let me know. 17 A. OK. 18 Q. Please don't read it aloud -- you can read it aloud because 19 it is in evidence. 20 A. OK. 21 Q. Was that correct? 22 A. Correct. This report didn't deal with any of the financial 23 impacts of the project or the tax revenues, city services -- 24 any of that stuff. 25 Q. With respect to the efforts of Forest City Ratner to get SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1237 C2SUANN2 Swagerty - cross 1 the fifth and deciding vote which, again, became necessary once 2 Judge Colabella issued his decision declaring the vote to do 3 away with the super majority void and invalid, did you have any 4 role in the efforts to meet with or persuade Dee Barbato, John 5 Murtagh, Sandy Annabi to change their vote to a yes vote? 6 A. No, I didn't. 7 MR. ARONWALD: No further questions. 8 Thank you, sir. 9 THE COURT: Mr. Siano. 10 MR. SIANO: Thank you. 11 Mr. Turk, would you be kind enough to bring up 12 Government Exhibit 443 in evidence. 13 CROSS-EXAMINATION 14 BY MR. SIANO: 15 Q. That's all right, Mr. Swagerty, they are going to put it on 16 the screen. 17 Now, Mr. Swagerty, do you recall seeing Government 18 Exhibit 443 sometime in the fall of 2006? 19 A. Yes, I do. 20 Q. In fact, it was after October, isn't that right? 21 A. Yeah, correct. 22 Q. You remember that? 23 A. I remember seeing this. 24 Q. You remember, you went looking for something called FC 25 Acquisition Associates, LLC, didn't you? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1238 C2SUANN2 Swagerty - cross 1 A. Yeah, I did. 2 Q. Because you are the man who put the money in the boxes, 3 isn't that right? 4 A. Yeah. 5 Q. And you found that there was no such entity at Forest City 6 Ratner? 7 A. Yeah. I was confused because I had never heard of it 8 before. 9 Q. And you went looking for it and it wasn't there? 10 A. Correct. 11 Q. You told Mr. Cantone that, didn't you? 12 A. Yeah. 13 Q. You did. You expressly told him that, is that right? 14 A. Yes. 15 Q. And his response was put, it in retail hunting, isn't that 16 right? 17 A. Yes. 18 Q. That's what he said to you? 19 A. Yeah. 20 Q. Now, you never spoke to Mr. Zehy Jereis, did you? 21 A. No. 22 Q. Never met him? 23 A. Never met him. 24 Q. So when you commented on direct that you thought that his 25 invoices were junior varsity, you spoke to Ms. Venezia and SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1239 C2SUANN2 Swagerty - cross 1 Mr. Bender about that? 2 A. Yes. 3 Q. So you spoke to what I would describe as a superior and his 4 administrative assistant about that? 5 A. Correct. 6 Q. And you recall that revised invoices came back to you? 7 A. Yes. 8 Q. And you don't know, as you sit there now, who revised those 9 invoices, do you? 10 A. No. 11 Q. Nevertheless, in December of 2006, you received a 12 communication by email about paying those invoices, isn't that 13 right? 14 A. December 2006. 15 Q. Yeah, let's see that. 16 MR. SIANO: Mr. Turk, if you could bring up 389I, 17 please. 18 Q. And Mr. Swagerty, if you just wait with us for a second 19 here. 20 A. OK. 21 MR. SIANO: If you bring up the first email in the 22 string from Venezia, December 6, 11:49 a.m., the whole text. 23 Q. Now, there's a second page to this, but do you recall 24 seeing this as part of a later email to you? 25 This is a beginning of the string -- now, that is a SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1240 C2SUANN2 Swagerty - cross 1 phrase that's been used in this trial to describe a bunch of 2 emails on one piece of paper. 3 A. I mean, I don't recall exactly but -- 4 MR. SIANO: Mr. Turk, let's go back to the whole 5 document then. 6 Q. How about the top part? Mr. Swagerty, do you recall 7 getting this email? 8 A. Yeah. 9 Q. Ah, so we got the last email in the string. And this is 10 from Ms. Venezia, right? 11 A. Yes. 12 Q. With a copy to the two fellows you referred to as Bruce and 13 Scott during direct, isn't that right? 14 A. Yeah. 15 Q. These are the higher-ups? 16 A. Yeah. 17 Q. Ms. Venezia is their administrative assistant? 18 A. That's correct. 19 Q. And she is copying them on something called "Re: ZJ 20 Enterprises, importance high." And we have a message here, 21 December 7, 2006, "John, we need to get ZJ Enterprises paid 22 ASAP. Can you please expedite. It is extremely important that 23 we get a check." 24 Do you recall getting that message? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1241 C2SUANN2 Swagerty - cross 1 Q. You paid the invoices after you got this message, isn't 2 that right? 3 A. Well, I signed off on them and sent them down to the 4 accounting department. They would then pay for them. 5 Q. I wasn't suggesting that this money came out of your 6 pocket? 7 A. Right. 8 Q. You caused the invoices to be paid by some box on the 9 Forest City Ratner chart shortly after you got this email? 10 A. Yes. 11 MR. SIANO: Now, if we could expand back, Mr. Turk, to 12 the entire email. 13 Q. Do you recall that in fact it was invoices totaling 14 $15,000? 15 MR. SIANO: There's a second page to this, Mr. Turk, 16 if you could show Mr. Swagerty the second page. Since we just 17 met, I don't want him just to rely on me. 18 THE WITNESS: OK. Yep. It appears to be three 19 months, $15,000. 20 BY MR. SIANO: 21 Q. Three months, $15,000 paid in December, is that correct, 22 sir? 23 A. I believe so, yeah. 24 Q. December 2006? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1242 C2SUANN2 Swagerty - cross 1 Q. As far as you know, not another dime was ever paid to 2 Mr. Jereis in any manner, shape or form, as far as you know? 3 A. As far as I know. 4 Q. Now, you testified on direct, you used the phrase "part of 5 his contract," you were referring to 442, isn't that right, 6 when you talked about the ZJ Enterprises contract? 7 A. That the -- 8 MR. SIANO: 442? 9 MR. CARBONE: 443. 10 MR. SIANO: Thank you. 443. 11 Q. Somewhere in there, you recall something about the specific 12 terms as to what he was doing, isn't that right? 13 A. Yes. In the third paragraph it is discussed. 14 Q. Thank you. 15 The invoices that were paid were invoices for August, 16 September and October of 2006, isn't that right? 17 A. Yes. 18 Q. Now, you made reference to the budget for Ridge Hill. Do 19 you recall an interview with the FBI? 20 A. I do, yeah. 21 Q. And in fact you described the original budget for this 22 project to the FBI, didn't you? 23 A. Yeah. 24 Q. And it was 400 to 500 million dollars, wasn't it? 25 A. Yeah. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1243 C2SUANN2 Swagerty - cross 1 Q. It came in at a nice round $600 million, didn't it? 2 A. Sir, what happens -- 3 Q. I am just asking you if it was closer to 600 than 400? 4 A. It all depends on the point of time that the question is 5 asked. The project costs increased quite a lot over the time 6 that I worked on it. There was a period where it was closer to 7 500, and there was a time in 2007 when it was closer to 600. 8 Q. What is it at today? 9 A. I haven't looked at it in more than a year, so I don't 10 recall. 11 Q. Now, you described the work you did at the direction of 12 Mr. Pesin to go out and find these properties? 13 A. Yes. 14 Q. Let me ask you a generalized question. Did you ever go to 15 a spot and not find the particular site that was listed in 16 whatever reports you were analyzing? 17 A. I had some trouble locating a couple of the sites. 18 Q. Because they were small? 19 A. Maybe they were small and maybe the information I was given 20 was not enough information for me to go on. 21 Q. After you reported back to Mr. Pesin, he marked "pursue" on 22 one of them? 23 A. Yes. 24 Q. And these are generally people up the chain from you? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1244 C2SUANN2 Swagerty - cross 1 Q. Did anybody tell you that Mr. Jereis had been told to find 2 supermarkets and empty lots? 3 MR. HALPERIN: Objection. Hearsay. 4 Q. Anybody at Forest City Ratner among your superiors ever 5 tell you that Mr. Jereis was to look for supermarkets and empty 6 lots? 7 MR. HALPERIN: Objection. Hearsay. 8 THE COURT: Sustained. 9 MR. SIANO: Judge, it is not offered for the truth. 10 It is offered for the fact that the words were said. 11 MR. HALPERIN: It is offered for the truth. 12 THE COURT: Sustained. 13 BY MR. SIANO: 14 Q. Other than the contract you saw, did you have any 15 information in your possession when you went looking at these 16 sites as to the instructions that were given to Mr. Jereis? 17 A. No, just a list of sites. 18 MR. SIANO: Thank you. 19 No further questions. 20 MR. HALPERIN: No redirect, your Honor. 21 THE COURT: You may step down. 22 (Witness excused) 23 MR. HALPERIN: Does the Court want to take a 24 two-minute break? 25 THE COURT: I don't, but let's do since you are going SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1245 C2SUANN2 Swagerty - cross 1 to get a new witness. 2 Let's take a short break. 3 Don't discuss the case. Keep an open mind. 4 (Recess) 5 6 (Continued on next page) 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1246 C2sQann3 1 (In open court; jury present) 2 THE COURT: OK. Have a seat. Call your next witness, 3 please. 4 MR. HALPERIN: Your Honor, the government calls Franco 5 Milio. 6 FRANCO MILIO, 7 called as a witness by the Government, 8 having been duly sworn, testified as follows: 9 DIRECT EXAMINATION 10 BY MR. HALPERIN: 11 THE DEPUTY CLERK: Be seated. Pull the chair all the 12 way up to the mike. Tell us your full name and spell your last 13 name. 14 THE WITNESS: Franco Milio, M-I-L-I-O. 15 THE COURT: You may inquire. 16 MR. HALPERIN: Thank you, your Honor. 17 BY MR. HALPERIN: 18 Q. Good morning, Mr. Milio. 19 A. Good morning. 20 Q. How old are you, sir? 21 A. 36 years old. 22 Q. What city do you live in? 23 A. Scarsdale. 24 Q. What county is that? 25 A. Westchester County. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1247 C2sQann3 F. Milio - Direct 1 Q. How long have you lived in Scarsdale, New York? 2 A. Seven years. 3 Q. How far did you go in school? 4 A. College. 5 Q. You graduate? 6 A. No. 7 Q. What do you do for work, sir? 8 A. I manage family real estate holdings, develop and manage 9 buildings, essentially. 10 Q. What's the name of your company? 11 A. Milio Management. 12 Q. Is that a family business? 13 A. Yes. 14 Q. How long have you worked for Milio Management? 15 A. Since 1997, approximately 15 years. 16 Q. Who currently owns Milio Management? 17 A. My -- it's a 50 percent my side of the family and 18 50 percent my cousin's side of the family. 19 Q. And when was Milio Management created? 20 A. 1997. 21 Q. Up until a few years ago who owned the company? 22 A. My father and my uncle. 23 Q. What's your title at Milio Management? 24 A. Specifically I don't have a specific title, but I would 25 consider myself a property manager or just a manager of the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1248 C2sQann3 F. Milio - Direct 1 office. 2 Q. What's your role in the business? What do you do on a 3 day-to-day basis? 4 A. I handle essentially between rental applications, 5 refinancing, development, I would say I have an involvement in 6 pretty much everything. 7 Q. What year did the family establish Milio Management? 8 A. It was July 1997 when it first was started. 9 Q. Which other family members work for the business? 10 A. Myself, my sister, my brother part time, and that's it for 11 now. 12 Q. Your father? 13 A. I'm sorry, my father does and my uncle do as well, and my 14 cousin used to and he passed away since. 15 Q. What's your father's name? 16 A. Antonio Milio. 17 Q. And your uncle's name? 18 A. Giuseppe Milio. 19 Q. We may need the spelling of Giuseppe. 20 A. G-I-U-S-E-P-P-E. 21 Q. Where is Milio Management's office located? 22 A. In Yonkers on Ashburton Avenue. 23 Q. About how many properties does Milio Management own and 24 manage? 25 A. Approximately 36, three dozen. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1249 C2sQann3 F. Milio - Direct 1 Q. Generally, where are the properties located? 2 A. Generally they are in southern Westchester and the Bronx, 3 Mount Vernon, Yonkers, Dobbs Ferry and the Bronx. 4 Q. Mount Vernon, Yonkers, Dobbs Ferry are in which county? 5 A. Westchester. 6 Q. Does Milio Management build properties? 7 A. It has in the past, yes. 8 Q. Does the company fix up and renovate properties? 9 A. Yes. 10 Q. And what might a renovation to a building entail? 11 A. A renovation will typically entail a complete gut/rehab 12 which would be new -- building wide systems, plumbing, new 13 roof, doors, floors, bathrooms, kitchens. 14 Q. When you fix up properties, do you purchase materials 15 manufactured outside of New York State? 16 A. We do, yes. 17 Q. Do you purchase building materials from companies outside 18 of New York State? 19 A. Yes. 20 Q. Do you ever use rock salt in your business? 21 A. Yes. 22 Q. For what purpose? 23 A. Part of the management office's responsibilities is to 24 manage rental properties, our properties, and we use rock salt 25 for the winter, slip -- to make sure the sidewalks aren't SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1250 C2sQann3 F. Milio - Direct 1 slippery. 2 Q. Where do you buy the rock salt from? 3 A. Pennsylvania. 4 Q. A company located in Pennsylvania? 5 A. That's correct. 6 Q. Do you ever use -- do you ever buy bathroom tiles for your 7 buildings? 8 A. Yes. 9 MR. ARONWALD: Objection, leading, your Honor. 10 THE COURT: The objection is sustained. 11 Q. What, if anything, do you need to use -- to renovate a 12 bathroom? 13 A. We use tiles, plumbing fixtures, copper piping, waste 14 pipes, vanities, medicine cabinets, toilets. 15 Q. When you buy tiles for the bathrooms, where do you buy the 16 bathroom tiles from? 17 A. They come from a wholesale distributor from New Jersey and 18 also they come from out of country such as Europe, South 19 America, China. 20 Q. Are there any other materials that Milio Management gets 21 from outside of New York State? 22 A. There are. 23 Q. For how many years has Milio Management bought materials 24 from outside New York State? 25 A. Since its existence, 15 years. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1251 C2sQann3 F. Milio - Direct 1 Q. Let me direct your attention to March 2008. Did you and 2 your father begin to cooperate with the FBI and the U.S. 3 Attorney's office? 4 A. Yes. 5 Q. Did you and your father retain counsel? 6 A. Yes. 7 Q. Who is your attorney? 8 A. Lawrence DiGiansant. 9 Q. What did you do as part of your cooperation? 10 A. We came in and spoke to the government and told them pretty 11 much everything that had occurred. 12 Q. Did you discuss the Longfellow project? 13 A. We did. I did. 14 Q. During your cooperation, did you also talk about some of 15 your own wrong conduct? 16 A. Yes. 17 Q. Mr. Milio, at some point were you charged with a federal 18 criminal charge? 19 A. Yes. 20 Q. Were you charged in an information? 21 A. Yes. 22 Q. What were you charged with? 23 A. Tax evasion, one count tax evasion. 24 Q. What happened with your case? Did you go to trial or did 25 you plead guilty? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1252 C2sQann3 F. Milio - Direct 1 A. Pled guilty. 2 Q. About how long ago did you plead guilty? 3 A. This month, about February 3 of this month. 4 Q. At about the time of your guilty plea, did you enter into a 5 formal cooperation agreement with the government? 6 A. Yes. 7 Q. Why did you decide to cooperate with the government? 8 A. I did it mainly to tell the truth and to also protect my 9 family. 10 Q. Were you also hoping to get a lower sentence for yourself? 11 A. Of course, yes. 12 Q. What's your understanding of what you must do under the 13 terms of your cooperation agreement? 14 MR. SIANO: Objection, your Honor. 15 MR. HALPERIN: It's not leading at all. 16 THE COURT: I think he'd rather have the cooperation 17 agreement introduced into evidence. Is that what you're 18 saying? It's the best evidence of what he has to do, is that 19 what you'd like, Mr. Siano? 20 MR. SIANO: Side bar, your Honor? 21 THE COURT: No side bar. The objection is overruled. 22 Q. Sir, you can answer. What's your understanding of what you 23 must do under the terms of your cooperation agreement? 24 A. Give my truthful testimony. 25 Q. What must you do in terms of paying back taxes you owe? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1253 C2sQann3 F. Milio - Direct 1 A. Refile amended returns. 2 Q. And what about paying any back taxes? 3 A. Oh, we have to pay them. Upon filing amended tax returns, 4 there will be an amount due, and it will have to be paid. 5 Q. What's your understanding of what the government agreed to 6 do under the terms of the cooperation agreement? 7 A. It agreed to give me a -- nothing. Nothing. Just a give a 8 letter. It's called, I believe, a 5K letter, a recommendation 9 letter of some sort. 10 Q. Who is a 5K letter sent to? 11 A. I believe it's the judge, the sentencing judge. 12 Q. What's your understanding of what the government's 5K 13 letter will say to the sentencing judge? 14 A. That I cooperated and I gave my truthful testimony today. 15 Q. What, if anything, will it say about the bad things you've 16 done? 17 A. It will disclose everything, good and bad. 18 Q. Have you been sentenced yet? 19 A. No. 20 Q. Which Judge was assigned to your case? 21 A. Judge Briccetti. 22 Q. What's a maximum sentence you face at sentencing. I'm 23 sorry, Briccetti? 24 A. Briccetti. 25 THE COURT: It's OK. It's frequently mispronounced. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1254 C2sQann3 F. Milio - Direct 1 Q. Judge Vincent Briccetti in White Plains, sir? 2 A. That's correct. 3 Q. What's the maximum sentence you face at your sentencing? 4 A. Five years imprisonment. 5 Q. Has the government promised to recommend a specific 6 sentence for you? 7 A. No. 8 Q. Who decides what your sentence will be? 9 A. Judge Briccetti. 10 Q. In your cooperation agreement, did you agree that you had 11 engaged in a tax evasion scheme? 12 A. Yes. 13 Q. Did you admit to failing to pay the full amount of 14 corporate income taxes? 15 A. Yes. 16 Q. Did you admit to failing to pay the full amount of personal 17 income taxes? 18 A. I did. 19 Q. Did you admit to failing to pay the full amount of payroll 20 taxes? 21 A. Yes. 22 Q. Did you admit to failing to report rental income your 23 company had received? 24 A. Yes. 25 Q. Do you admit that -- SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1255 C2sQann3 F. Milio - Direct 1 MR. ARONWALD: Objection to leading, your Honor. It's 2 all leading. 3 THE COURT: The objection is sustained. 4 Q. Sir, what, if anything, did you admit for the tax years 5 2006 to 2008 about income that you failed to report in terms of 6 rental income? 7 A. I failed to report the adequate income that the rental 8 properties made. It wasn't filed correctly. 9 Q. Do you remember the amounts roughly of the amount of rental 10 income you failed to report? 11 A. Yes. 12 Q. What was the amount? 13 A. Approximately $2.2 million. 14 Q. Did you hire employees who did not work in the country 15 legally? 16 A. Yes. 17 Q. Did you admit that you paid many employees -- 18 MR. ARONWALD: Objection. 19 THE COURT: The objection is sustained. Look I have 20 no objection to the documents coming in. All right. I have no 21 objection to your showing it to the witness, asking him 22 open-ended questions, and if he needs to refresh his 23 recollection about what he admitted to when he took a plea 24 three weeks ago, he is welcome to look at the document, all 25 right? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1256 C2sQann3 F. Milio - Direct 1 MR. HALPERIN: That's fine. 2 Q. What, if anything, did you admit to, sir, about paying 3 employees in cash? 4 A. I admitted that the employees were paid what was commonly 5 referred to as off-the-books. 6 Q. What, if anything, did you admit to in terms of 7 approximately how much money in cash wages to employees you 8 failed to report? 9 A. Approximately $2 million. 10 Q. What, if anything, did you admit to in terms of tips and 11 holiday gifts that you gave to city of Yonkers employees? 12 A. Some were given. 13 Q. What, if anything, did you admit about whether these 14 employees included building inspectors? 15 A. They were. They were, and -- yes, they were. 16 Q. What, if any, favors did you ask from these city employees? 17 A. None. 18 Q. From 2000 to 2004, did you engage in any real estate deals 19 to buy properties? 20 A. Yes. 21 Q. On a certain number of -- how many, if any, occasions did 22 you pay cash under the table to the seller in addition to the 23 listed sales price? 24 MR. SIANO: Objection, leading. 25 THE COURT: The objection is sustained. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1257 C2sQann3 F. Milio - Direct 1 Q. Sir, what, if anything, did you say about paying cash in 2 addition to the sales price? 3 A. There were instances where cash was offered under the table 4 upon purchasing or acquiring a property. 5 Q. Mr. Milio, are you familiar with the Longfellow project? 6 A. Yes. 7 Q. Let me direct your attention to 2003 to 2005. What was the 8 proposal for the Longfellow project? 9 A. Essentially, it was a land swap agreement with the city. 10 There are two schools: One on North Broadway and Ashburton 11 Avenue in Yonkers known as School 6, and one on Mulberry Street 12 in Yonkers known as the Hollows, that's the Longfellow Junior 13 High School, and what it involved was demolition of our 14 properties, several properties along North Broadway and giving 15 the city a road widening as well, and completely at our expense 16 we were to develop a Walgreens store on the North Broadway 17 Ashburton site and renovate the Longfellow school into 40 18 market rate housing apartments completely at our expense. 19 Q. What was the condition of the two schools? 20 A. Completely -- they were -- School 6 is a tear-down, and 21 Longfellow is essentially close to a tear-down. Poor 22 condition. 23 Q. What do you mean by tear-down? 24 A. They had to be -- well, School 6 couldn't be salvaged. It 25 had to be torn down, and Longfellow was not quite there but in SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1258 C2sQann3 F. Milio - Direct 1 very poor shape. So I meant tear down meaning demolition, 2 demolished. 3 Q. You mentioned a moment ago land swap. Explain what you 4 meant by that. 5 A. Land swap meant that there would be no money exchanged for 6 the properties in question but the developer, us, would have to 7 give up our properties, demolish our buildings along North 8 Broadway, move the tenants out, move the stores out. Our 9 buildings which had been recently remodeled as well, we would 10 have to be responsible at our expense for demolishing the 11 buildings, developing the site and giving the city a road 12 widening in exchange for the schools, and we had to make the 13 promise that we had to renovate the Longfellow School, it must 14 be developed. 15 Q. Now, I'm going to ask you to look at what you have in front 16 of you there in that folder as Government Exhibit 735 and 735A 17 through D. Please pull that file out. Sir, do you recognize 18 those items? 19 A. Yes. 20 Q. What do you recognize that to be? 21 A. School 6. 22 Q. Don't hold the photos up. Are they photographs? 23 A. They are. Yeah they're photographs. 24 Q. Of what? 25 A. School 6 and Longfellow. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1259 C2sQann3 F. Milio - Direct 1 Q. Do the photos fairly and accurately depict School 6 and the 2 Longfellow School? 3 A. Yes. 4 Q. And do they fairly and accurately depict them as they 5 looked in 2006? 6 A. Yes. 7 MR. HALPERIN: Your Honor, the government offers 8 Exhibit 735 and 735A through D. 9 MR. ARONWALD: No objection. 10 MR. SIANO: No objection. 11 THE COURT: Admitted. 12 (Government's Exhibits 735 and 735A through 735D 13 received in evidence) 14 Q. Mr. Turk, can we have 735 please for the moment? Let's go 15 to 735B. 735 A. 16 Mr. Milio, what's shown in these three photos? 17 A. In A? 18 Q. The three photos we just put up on the screen. 19 A. Longfellow Junior High School. 20 Q. It's the Longfellow School? 21 A. Yes, Longfellow. 22 Q. What was the condition of the Longfellow School in 2005 and 23 2006? 24 A. It -- it -- it's in poor condition. As in this exhibit 25 here, the cornice is missing. The roof is missing. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1260 C2sQann3 F. Milio - Direct 1 Q. Slow down a second. Describe upper left, upper right. 2 A. I'm sorry. Upper left where the red bricks are exposed, 3 there used to be like a covering, like a lead covering or it's 4 called a cornice. The roof was gone. It had caught fire 5 several times. And that's pretty much it on this picture. 6 Q. What about the windows on the first floor? 7 A. Oh, the windows, yeah. The windows are missing for the 8 most part. There -- everything had to be replaced in the 9 building. We knew that going into this project. 10 Q. I think you said it was poor, but what's the condition of 11 the building now? 12 A. Similar or worse. 13 Q. Now, under the proposal for the Longfellow project, what 14 would have happened to the Longfellow School? 15 A. This was -- with our meetings with the administration, the 16 city administration, it was to be developed into 40 market rate 17 housing units, apartments. 18 Q. What would Milio Management have had to do to make the 19 building safe and livable? 20 A. A complete gut/rehab which entailed, like I mentioned 21 earlier, a new roof. In this case, new plumbing, new 22 bathrooms, new kitchens. In this structure even more so 23 because originally it was a school building and everything 24 would have to be brand new because there were no bathrooms 25 except those in the public hallways for the children, but, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1261 C2sQann3 F. Milio - Direct 1 otherwise, it needed everything from the beginning -- you know, 2 every system in the building would be needed in the structure. 3 Q. Is the building still vacant today? 4 A. It is, yes. 5 Q. Thank you. 6 Mr. Turk, can we have 735D. And 735C. 7 What is shown, sir, in these two photos 735D and C? 8 A. In D, it's School 6. Do you want me to explain more? 9 Q. Yes. 10 A. In D it's School 6. It's not on the monitor though, D. I 11 just want to show -- 12 Q. Mr. Turk, let's put up D for a moment. 13 A. In D that's School 6, and that's the annex building, that 14 building on the bottom left on the left side of the screen. 15 Q. What color is School 6? 16 A. The color itself is red bricks, but the annex is that 17 one-level building. 18 Q. To which side? 19 A. On the left side. 20 Q. The annex is on which side? 21 A. The left side of the monitor, and it's a one-story 22 structure. It's part of the school, part of School 6. 23 Q. Let's go back to 735C. What's was the condition of School 24 6 in 2005 and 2006? 25 A. Similar as it is here. It was in poor shape. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1262 C2sQann3 F. Milio - Direct 1 Q. Why was it in poor shape? Expand on that. 2 A. It had been for years neglected. As a matter of fact, in 3 this picture here, as back in 2005 and earlier, the windows 4 were removed which I think contributed to its detriment, and 5 the roof had completely collapsed. 6 Q. What was going to be done under the proposal for the 7 Longfellow project to School 6? 8 A. That entailed -- our discussions with the administration 9 was to demolish our properties which is depicted in this 10 picture here. It's on the right side, one of our properties is 11 seen there -- 12 Q. What color is that? 13 A. It's the white roof building, and it's yellow, yellow 14 siding. You can't really tell in this picture, but it's the 15 one on the right side with the three windows. That building 16 there was part of the project to be demolished, which had been 17 renovated a few years earlier, brand new roof and the whole 18 rear was restored to -- it was collapsing, but that was part of 19 the project. It had to be demolished, and there was a 14 -- is 20 still a 14-unit building with two stores and more properties to 21 the north. So all of this had to be demolished including the 22 schools -- the school and the annex. 23 Q. What was going to be built there? 24 A. A Walgreens. A Walgreens. A triple net it's called. A 25 Walgreens retail store, it's a pharmaceutical -- SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1263 C2sQann3 F. Milio - Direct 1 Q. A drugstore? 2 A. A drugstore, yes. Yes. Pharmacy, drugstore. 3 Q. What about the parking lot? 4 A. It was going to be a 14,400 square foot pharmacy, and it 5 was going to -- that entailed having a parking lot, a 6 drive-thru, and an entrance from North Broadway and from 7 Ashburton Avenue. 8 Q. Under the proposal for the project, who would have built 9 the Walgreens? 10 A. We would have. We would have -- we were responsible for 11 that. 12 Q. Now, when you use the term the Longfellow project, what 13 properties or property are you referring to? 14 A. Both. When I refer to the Walgreens project, it always 15 is -- it entails both buildings, the School 6 and the 16 Longfellow because that's how our negotiations with the 17 administration had begun. 18 Q. How did the idea of the Longfellow project involving the 19 two schools come about? 20 A. We were called into a meeting at city hall back in 2003. 21 Q. What happened at the meeting? 22 A. At that time it was the Deputy Mayor Phil Amicone, he was 23 proposing the development of these two sites. Shortly 24 thereafter we agreed to pursue what I just spoke about, 25 demolishing our properties and restoring Longfellow into market SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1264 C2sQann3 F. Milio - Direct 1 rate housing. This is what had been suggested to us, and we 2 made a decision to move forward with it. 3 Q. What would you get, what would Milio Management get under 4 the proposal? 5 A. Under the proposal, Milio Management would just get -- we 6 would have the triple net Walgreens store, and we would have 7 the Longfellow school, but we would have to fix it, of course. 8 That was the agreement. 9 Q. What, if anything, would you do for the city? 10 A. Say that again? I'm sorry. 11 Q. Would you have to give any property to the city? 12 A. Oh, yes. On North Broadway in exchange what we had -- 13 there was a land swap in that on North Broadway we had to 14 not -- demolish our properties and give an eight foot or ten 15 foot turning lane along Ashburton and North Broadway because of 16 traffic on the street. They wanted us to at our expense -- 17 part of the deal was at our expense to build an extra road and 18 put the traffic light up and pretty much do everything for them 19 including the traffic signal as well all along North Broadway. 20 It was about a 40-foot stretch on North Broadway and 20 feet on 21 Ashburton Avenue a turning lane. 22 Q. You mentioned triple net before. What's triple net? 23 A. It's just a term in the retail business that once we build 24 the structure, Walgreens would take over maintaining their 25 business on their own, including the parking lot. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1265 C2sQann3 F. Milio - Direct 1 Q. Now, what year did you have a meeting with the city of 2 Yonkers officials? 3 A. It was 2003. 4 Q. When you first met with city officials in mid 2003 -- or in 5 2003, what was your understanding about how the project would 6 be approved? 7 A. It was -- it was understood that it would go through the 8 industrial development agency IDA we call it. 9 Q. And where is -- what entity is that in what city? 10 A. It's an entity in Yonkers. It's like another quasi-city 11 agency, I believe. It's called, like I say, Industrial 12 Development Agency. It was going t be handled through them, 13 the whole project as far as the handling of the schools, etc. 14 Q. At some point did your understanding of the approval 15 process change? 16 A. It did, yes. 17 Q. Which governmental body would have to approve the project? 18 A. We were told in a meeting in late 2004, fall of 2004, a 19 year and a half later after we started this project, that we 20 were no longer going through the IDA, and that we were going to 21 go through the city council. They would have to approve it, 22 the Yonkers City Council members. 23 Q. Why did that change from the IDA to the city council? 24 A. I'm not really a hundred percent sure. There was an issue 25 and -- SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1266 C2sQann3 F. Milio - Direct 1 MR. ARONWALD: Objection. He doesn't know, your 2 Honor. 3 THE COURT: If you don't know, you don't know. That's 4 all you had to say. 5 A. Oh, OK. I'm not really sure. 6 Q. Once you had to get approval from the city council, what 7 specifically was Milio Management trying to get named in 8 relation to the Longfellow project? 9 A. It was called designated developer status. 10 Q. And what would that mean? 11 A. Basically exclusivity; that we would be the developers for 12 these two projects. 13 Q. Let me direct your attention to January 2005. Did you meet 14 with city council members at the time? 15 A. Yes, I did. 16 Q. Let me ask you to look in front of you. You have 17 Government Exhibit 708. 18 A. Should I put these away? 19 Q. Yes. Pull it out. You can put the photos away. You can 20 just put them to the side there, that's fine. 21 A. Which exhibit? 22 Q. 708. Sir, do you recognize this item? 23 A. I do. 24 Q. What do you recognize it to be? 25 A. It's calendar entry that I made on Outlook. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1267 C2sQann3 F. Milio - Direct 1 Q. What date? 2 A. Dated for January 25, 2005. 3 Q. Relating to what? 4 A. It's city hall meeting -- 5 Q. No. No. I don't want you to read it, but relating to what 6 project? 7 A. To the Walgreens Longfellow project. 8 Q. Did you provide this document to the government? 9 A. I did. 10 MR. HALPERIN: Your Honor, the government offers 11 Government Exhibit 708 into evidence. 12 MR. ARONWALD: No objection. 13 THE COURT: Admitted. 14 (Government's Exhibit 708 received in evidence) 15 Q. Mr. Turk, will you display 708, please? What's the subject 16 line, sir? 17 A. Should I read it? 18 Q. Yes, please. 19 A. City hall meeting with council members Annabi and MacDow. 20 Q. When you say Annabi, which council member was that? 21 A. Sandy Annabi. 22 Q. And MacDow? 23 A. Patricia MacDow. 24 Q. What's the date? 25 A. January 25, 2005. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1268 C2sQann3 F. Milio - Direct 1 Q. Did you, in fact, have a meeting on or around that date 2 with them? 3 A. Yes. Yes. 4 Q. Whose council district was School 6 in? 5 A. Patricia MacDow. 6 Q. Whose council district was the Longfellow school in? 7 A. Sandy Annabi. 8 Q. Why did you think it was important to get Councilwoman 9 Annabi's support for Longfellow project? 10 A. It had been explained to me that -- 11 MR. ARONWALD: Objection. Hearsay, your Honor. 12 MR. HALPERIN: It's not offered for the truth. 13 MR. ARONWALD: Of course it's offered for the truth. 14 THE COURT: Nicely done. 15 MR. HALPERIN: It's offered to show why he had the 16 meeting. 17 MR. ARONWALD: Why he had the meeting would be 18 irrelevant, your Honor -- 19 THE COURT: Excuse me. The objection is overruled. 20 Q. You can answer, sir. Why did you think it was important to 21 get Councilwoman Annabi's support for Longfellow project? 22 A. Essentially, I -- since it was in their districts, I'd have 23 to speak with them to get their OK or their approval on -- to 24 make this project move forward. 25 Q. Did you view the project as one project or two different SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1269 C2sQann3 F. Milio - Direct 1 projects? 2 A. It -- always one project. It was in the beginning one 3 project. 4 Q. Why do you say that? 5 A. Because our meetings initially with the administration, it 6 was -- since we were giving up our properties, and we had to 7 demolish our buildings, it was a package deal. Both 8 properties, both schools were involved in this project from day 9 one. It was one project. 10 Q. When you say both schools, just remind us which schools 11 you're referring to. 12 A. School 6, the red brick building on Ashburton Avenue, and 13 Longfellow which is on Mulberry in Yonkers as well in Sandy 14 Annabi's district. 15 Q. What would you have done if the city council said you could 16 proceed on one project but not the other? 17 A. The project was dead. 18 Q. Let me direct your attention to April 2005. You had 19 another meeting with Councilwoman Annabi? 20 A. Yes. 21 Q. I'm going to ask you to look at Government Exhibit 710 22 which you have in front of you. Do you recognize that item, 23 Mr. Milio? 24 A. I do. 25 Q. What do you recognize it to be? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1270 C2sQann3 F. Milio - Direct 1 A. It's a calendar entry I made. 2 Q. What day? 3 A. April 5, 2005. 4 Q. Relating to what project? 5 A. Walgreens Longfellow. 6 Q. Did you provide this document to the government? 7 A. I did. 8 MR. HALPERIN: Your Honor, the government offers 9 Government Exhibit 710 into evidence. 10 MR. ARONWALD: No objection. 11 MR. SIANO: No objection. 12 THE COURT: Admitted. 13 (Government's Exhibit 710 received in evidence) 14 Q. Mr. Turk, can we please display? 15 What name is written above the black line at the top 16 of the page? 17 A. Franco Milio. 18 Q. What's the subject line, sir? 19 A. WAG meeting with Sandy Annabi at city hall. 20 Q. What's WAG stand for? 21 A. It was an abbreviation I used to mean Walgreens. I had it 22 in there just to represent the project. To me it -- I used 23 WAG. 24 Q. What's the date? 25 A. April 5, 2005. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1271 C2sQann3 F. Milio - Direct 1 Q. Now, when you spoke to Councilwoman Annabi in January and 2 April 2005, what did she say about the Longfellow project? 3 A. When I had spoken to her, she -- I had the plans on her 4 desk, and she basically -- she pushed them away, said, "There's 5 this man who's vocal in the community his name is Steve 6 Kubicek. Get his approval and I'll support the project. It 7 really looks good," she said, "but if Steve supports it, I 8 support it." And I said fine. 9 Q. Who is Steve Kubicek? 10 A. Steve Kubicek, I found out later he was a former city 11 council member, and he is someone who's vocal in that 12 community, in the Hollows section of Yonkers, which is or was 13 Sandy Annabi's district, and he also is a homeowner. I believe 14 he owns properties in that district as well. 15 Q. When you say the Hollows section of Yonkers, what section 16 is that? 17 A. That's the -- where Longfellow is situated. It's a 18 neighborhood name. 19 Q. Let me direct your attention to mid April 2005. At that 20 time, did you meet with Steve Kubicek? 21 A. Yes, I did. 22 Q. What was the result of the meeting with Kubicek? 23 A. We -- 24 MR. ARONWALD: Objection. Hearsay, your Honor. 25 THE COURT: Objection is overruled. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1272 C2sQann3 F. Milio - Direct 1 Q. What was the result of the meeting with Steve Kubicek? 2 A. My father and I met with Steve, and there were also two -- 3 THE COURT: What was the result of the meeting? You 4 had a meeting. Don't tell us what happened at the meeting. 5 What happened after the meeting? Did something result from the 6 meeting? That was the question. 7 THE WITNESS: OK. It was favorable. He -- he was in 8 favor of the project. He supported it. 9 MR. ARONWALD: Objection hearsay. 10 THE COURT: That's not the result of the meeting. 11 Strike it. Did you take any steps or action as a result of 12 having this meeting? 13 THE WITNESS: We proceeded with the project. 14 THE COURT: OK. You proceeded with the project. 15 That's fine. That answer is allowed. The other one is 16 stricken. 17 Q. After you met with Steve Kubicek, did you speak to 18 Councilwoman Annabi on the phone? 19 A. I did. 20 Q. What happened in your phone conversation with Councilwoman 21 Annabi? 22 A. I explained to her that Steve supported the project, and we 23 were ready to move on, move forward. 24 Q. What did she say? 25 A. At the time she didn't seem phased by the conversation. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1273 C2sQann3 F. Milio - Direct 1 Q. Sometime later in the spring of 2005, did you see Annabi 2 and Kubicek before a public meeting? 3 A. Yes, there was a meeting at city hall, and I was -- I was 4 in the hallway, and I saw the elevator door open, and I saw 5 Sandy exit the elevator, and basically I heard, she said, 6 "Look, I don't support this project" and "I'm a city council 7 member, not you," and just walked straight ahead. 8 Q. Who did she say that to? 9 A. To Steve Kubicek, the person she asked me to speak with. 10 Q. When Annabi made that comment, what did you see Steve 11 Kubicek do? 12 A. He stood there with his mouth open. He was shocked. He 13 was appalled at what he had just heard, actually. 14 MR. ARONWALD: Objection. Move to strike. 15 THE COURT: The objection is sustained. 16 Q. Don't use words like appalled. 17 THE COURT: You can't tell us what is going on in 18 somebody else's head. 19 THE WITNESS: I understand. 20 THE COURT: You can tell us what's going on in your 21 head, but not somebody's else's head. 22 THE WITNESS: OK, sorry. 23 Q. Mr. Milio, what did you see Mr. Kubicek do? Don't tell us 24 what he -- 25 A. I saw him stand there with his mouth open. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1274 C2sQann3 F. Milio - Direct 1 Q. Let me direct your attention to the first half of 2005. 2 Did you attend city council meetings and real estate committee 3 meetings on Longfellow? 4 A. Yes, I did. 5 Q. Did you hear Councilwoman Annabi speak about the Longfellow 6 project at those meetings? 7 A. I did. 8 Q. I direct your attention to June 14, 2005. Did you attend a 9 city council meeting that day on the Longfellow project? 10 A. I did. 11 Q. How crowded was the meeting? 12 A. Crowded. It was crowded. 13 Q. What, if anything, did you see Councilwoman Annabi hold up 14 at the council meeting? 15 A. A bottle of soda, 20-ounce plastic bottle of soda. 16 Q. Let me ask you to pull out what's been received into 17 evidence as Government Exhibit 741 R1, R2 and R3. Do you 18 recognize those items, sir? 19 A. I do. 20 Q. Would do you recognize them to be? 21 A. Compact discs. 22 Q. How do you recognize them? 23 A. I initialed them, and I've seen them before. 24 Q. Did you review them before trial? 25 A. I have. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1275 C2sQann3 F. Milio - Direct 1 Q. What council meeting do they relate to, what date? 2 A. June 14 of '05 city council meetings. 3 Q. Are these CDs excerpts from the council meeting? 4 A. Yes, they are. 5 Q. Which council member is speaking in the excerpts? 6 A. Sandy Annabi. 7 Q. Did you attend the city council meeting that night? 8 A. Yes, I did. 9 Q. Mr. Turk, can we please play Government Exhibit 741 R1? 10 (Videotape played) 11 Q. Mr. Milio, at a later time, was Milio Management later 12 approved as a designated developer? 13 A. Yes, it was. 14 Q. What month and year did that happen? 15 A. September 2006. 16 Q. When you were approved in September 2006, did your proposal 17 include strictly senior housing? 18 A. No. No, it did not. 19 Q. Mr. Turk, please continue. 20 (Videotape played) 21 Q. Mr. Milio, did you hear Sandy Annabi say that the market 22 rate rentals drove people out of 220 Yonkers Avenue? 23 A. I did. 24 Q. How much, if any, of the approved project in September 2006 25 contained market rate housing? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1276 C2sQann3 F. Milio - Direct 1 A. The entire project. It had to have, I believe, a clause in 2 there about 20 percent below market, had to be below market. 3 So 80 percent would be market rate housing, sorry. 4 Q. Mr. Turk. 5 (Videotape played) 6 Q. Pause. What did you understand Councilwoman Annabi to mean 7 when she said the project did not fit within this community? 8 A. That she wanted senior housing only. 9 Q. Thank you. 10 Mr. Turk. 11 (Videotape played) 12 Q. Pause. 13 Mr. Milio, were you going to be getting the Longfellow 14 school for one dollar? 15 A. No. No, I wasn't. 16 Q. Why not? 17 A. As I had explained to her in several meetings, it was never 18 a dollar. It was a land swap deal which entailed my 19 demolishing of our -- five properties along North Broadway and 20 it was a 14-unit building, a retail store newly renovated, 21 another house, a one-family with a retail, and we were going to 22 give the city land and a turning lane. It was never a dollar. 23 That is untrue. 24 Q. What are the costs -- 25 A. I'm sorry? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1277 C2sQann3 F. Milio - Direct 1 Q. What costs had you incurred at Milio Management for the 2 project by June of '05? 3 A. Approximately $1.2 million. 4 Q. At that time? 5 A. June of '05, yeah, close to it, yes. We already started 6 vacating the tenants and moving -- because the project had been 7 moving along through the city with the administration with the 8 idea, so I was moving full force. I wasn't renting apartments 9 in the building. I was already negotiating with the stores, 10 moving them out. We had started a building on North Broadway 11 also, a one-family with a commercial, which we had a permit. I 12 had to pull all the copper and everything out of there to 13 prevent the people from breaking in, and I kept it empty, so, 14 yes. 15 Q. Who, if anything, did Milio Management have to hire in 16 terms of consultants to work on the project? 17 A. We had to hire, at that time -- at that time we had our 18 architects we started hiring environmental companies already to 19 do SECRAs, which are stuff for development, and there might be 20 more but I can't think of anything at the present moment. 21 Q. Mr. Turk, thank you. 22 (Videotape played) 23 Q. Mr. Turk, let's play 741 R2. 24 (Videotape played) 25 Q. Let's pause. Who said something there, Mr. Milio? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1278 C2sQann3 F. Milio - Direct 1 A. I did. 2 Q. What did you say? 3 A. I screamed "never." 4 Q. And why did you scream that? 5 A. Because I was upset. She was lying -- she was just lying. 6 She was making it up. I never said a dollar. 7 Q. When, if ever, did you tell Councilwoman Annabi that you 8 were going to be able to buy the project for a dollar? 9 A. If anything, I explained to her it was a land swap, and 10 there might have been legalese in the document to explain that. 11 You have to write some amount when you do a land swap or a 12 transfer. You can't say zero. So I might have explained to 13 her, I did explain to her, sorry, that it was a dollar, but I 14 think it was taken out of context here. 15 Q. Again, how much money had Milio Management incurred roughly 16 by this time in June 2005? 17 A. 1 million, 1.2. 18 Q. Mr. Turk, please keep going. 19 (Videotape played) 20 Q. Mr. Turk, let's splay Government Exhibit 741 R3. 21 Mr. Milio, just to be clear, are these three clips all 22 from the same council meeting? 23 A. They are. 24 (Videotape played) 25 Q. Thank you. Mr. Turk. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1279 C2sQann3 F. Milio - Direct 1 Mr. Milio, what was the result of the June 14, 2005 2 meeting? 3 A. It was denied. 4 Q. Well, let's be specific. What was being considered by the 5 council and what was denied? 6 A. I'm sorry. Longfellow was denied. School 6 was approved. 7 Q. When you say School 6 was approved, what did the city 8 counsel do in reference to the Milios? 9 A. In previous meeting, there was what's called a real estate 10 committee meeting, it was discussed to split it up into two, 11 into two projects. At that point I explained to them they can 12 split it up, that's fine. I had thought they wanted to split 13 up for their own purpose of, I guess their own -- their own 14 reasons, which I was willing to accept that, but I explained to 15 them, this is one project, it always has been, and it's either 16 one -- it's altogether or nothing. But that night they voted 17 on the two separate agenda items, which was Longfellow and 18 Walgreens and -- 19 Q. When you say -- I'm sorry, when you say Walgreens? 20 A. I'm sorry, School 6, School 6 and Longfellow. They voted 21 in favor of School 6 and not in favor of Longfellow. 22 Q. OK. When you say they voted -- the city council voted in 23 favor of School 6, what did they name you in relation to School 24 6? 25 A. The designated developer status. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1280 C2sQann3 F. Milio - Direct 1 Q. And they voted down your request for what on Longfellow? 2 A. Designated developer status. 3 Q. Let me ask you to look at Government Exhibit 740, which the 4 Court has already received into evidence. 5 Mr. Turk, let's display page 1. 6 Mr. Milio, you have it up on your screen there too. 7 It's not the greatest copy. Sir, do you recognize this 8 document? 9 A. I do. 10 Q. What do you recognize it to be? 11 A. It's a resolution dated June 14, 2005 from the meeting. 12 Q. Let's look at page 1 paragraph four, Mr. Turk. 13 What property does this resolution relate to here? 14 A. School 6. 15 Q. Let's go to page 3. And let's maximize the top half. 16 What was the vote on the resolution naming you the 17 designated developer of School 6? 18 A. It was approved. 19 Q. What was the vote, do you see at the last sentence there? 20 A. This motion -- yes, I do. 21 Q. What does it say? 22 A. This motion was carried unanimously. 23 Q. Seven to nothing? 24 A. That's correct. 25 Q. Let's display the next page, page 4. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1281 C2sQann3 F. Milio - Direct 1 And, sir, what is this? 2 A. A resolution dated June 14, 2005. 3 Q. Let's maximize paragraph four. 4 What did this resolution relate to, Mr. Milio? 5 A. The Longfellow School. 6 Q. Let's display the last page. Would you please highlight 7 the -- yes, top half, maximize the top half, please. 8 Can you read the last paragraph on the page there? 9 A. This resolution was defeated at a stated city council 10 meeting held on Tuesday, June 15, 2005 by a roll call vote of 4 11 to 3. Council President Martinelli, Majority Leader McLaughlin 12 and Council Member Roberston voting yea. 13 Q. What was Councilwoman Annabi's position on the vote that 14 day? 15 A. No or nay. 16 Q. Thank you. 17 Mr. Turk. 18 Now, as you sit here today, Mr. Milio, on 19 February 2012, has the Longfellow project ever gone forward? 20 A. No. 21 Q. Why not? 22 A. We, as you know I stated earlier, we did get named 23 designated developer in September 2006, and we moved forward 24 with the project hiring traffic consultants, going before the 25 zoning board of appeals. At a certain point in time Walgreens SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1282 C2sQann3 F. Milio - Direct 1 didn't really like the site any more, the School 6 site because 2 apparently a new operations manager, they didn't like it. They 3 were being very hard to talk to, very hard to communicate with. 4 Also, our designated developer status had come up again and we 5 had to go before the city council again. Essentially, we just 6 walked away from the project altogether. 7 Q. When you say your designated developer status had to come 8 up again, when one is named designated developer, how long is 9 that in terms of time? 10 A. A year with a six-month extension. 11 Q. So that time had elapsed? 12 A. That's correct, yes. 13 Q. Approximately how much money did Milio Management spend on 14 the Longfellow project in total? 15 A. Both the entire project at that point I would put it around 16 1.5 million, million and a half, million six. 17 Q. Now, in connection with the Longfellow project, did Milio 18 Management hire an attorney? 19 A. Yes. Yes, we did. 20 Q. Who did you hire? 21 A. Attorney Al DelBello. 22 Q. Who, if anyone, recommended him to you? 23 A. We had a meeting in the city, it was Ed Sheeran, a person 24 at city hall, one of the people we were dealing with. His name 25 us was Ed Sheeran, and he recommended him. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1283 C2sQann3 F. Milio - Direct 1 Q. Why did you decide to hire an attorney? 2 A. I just felt that perhaps me doing this on my own and also 3 when I spoke to Ed Sheeran, he said you should have used an 4 attorney, I felt that maybe I should have and I did the wrong 5 thing on doing it on my own, and I said let's try this again, 6 and therefore we hired Al DelBello. 7 Q. About when did you retain Al DelBello? 8 A. Shortly after the meeting. I would say the summer of 2005. 9 Q. Now, by April 2006, what, if any, progress had been made on 10 the Longfellow project? 11 A. Nothing. Very little. Nothing. 12 Q. At this time, how satisfied were you with the job DelBello 13 was doing? 14 A. Very much unsatisfied. 15 Q. Why were you very much unsatisfied? 16 A. Practically eight months had passed and we were in the same 17 position we were a year earlier. Nothing really -- it was 18 pretty much moving at a snail's pace, the whole project. 19 Q. At that point in or around April 2006, did you decide to 20 hire another attorney? 21 A. Yes. 22 Q. Who did you hire? 23 A. Anthony Mangone. 24 Q. How did you end up retaining Anthony Mangone? 25 A. There was a meeting that we had in Yonkers, and we spoke SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1284 C2sQann3 F. Milio - Direct 1 then and we met then. 2 Q. Did someone recommend him to you? 3 A. Yes. My cousin mentioned him. My cousin had mentioned his 4 name and set up a meeting. 5 Q. Did you have an initial meeting with Mr. Mangone? 6 A. Yes. Yes, I did. 7 Q. Where was that meeting located? 8 A. It was in Yonkers at a restaurant Reno's on Lockwood 9 Avenue. 10 Q. What date did you meet with Anthony Mangone at Reno's 11 restaurant? 12 A. It was April 14, 2006. 13 Q. Who was at this initial meeting at Reno's? 14 A. It was myself, Anthony Mangone, this man Joe Gennaro. Who 15 else? My -- I said myself, Anthony Mangone, Joe Gennaro. 16 Dominick, Romeo, my two cousins, and later on Nick Spano, 17 former U.S. senator, state senator passed by as well. 18 Q. You mentioned a bunch of names there. When you say 19 Dominick, who are you referring to? 20 A. My cousin, my first cousin. 21 Q. What's his name? 22 A. Dominick Miano. 23 Q. And Romeo? 24 A. Romeo Milio, yes. 25 Q. A cousin? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1285 C2sQann3 F. Milio - Direct 1 A. Oh, both my first cousins, yes. 2 Q. Now, when you met Anthony Mangone at Reno's restaurant, 3 what did you discuss? 4 A. We -- my family attorney pretty much had retired earlier, 5 and we were discussing future business, different projects. 6 Longfellow came up and the Walgreens site, several things. 7 Q. At the meeting, what, if anything, did Mr. Mangone say to 8 you about Councilwoman Annabi and the Longfellow project? 9 A. At the meeting when I was discussing my frustration, he 10 pretty much told me I was getting dicked around; that she was 11 dicking me around were his exact words. 12 MR. ARONWALD: Objection. Hearsay. Move to strike. 13 MR. HALPERIN: A statement in furtherance of. 14 THE COURT: The objection is overruled. 15 Q. After the meeting at Reno's, did you start to work with 16 Mr. Mangone? 17 A. Yes. 18 Q. What did you tell Mr. DelBello about your hiring of 19 Mangone? 20 A. I mentioned -- I asked him if he'd like to, I guess, work 21 together with Anthony like a co-attorney or, I don't really 22 know the exact term, but to work together with Anthony. 23 Q. Did that end up happening? 24 A. No. 25 MR. HALPERIN: Judge, I just want to get a sense from SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1286 C2sQann3 F. Milio - Direct 1 the Court when does the Court want to break for lunch? 2 THE COURT: Not this minute. 3 MR. HALPERIN: So you'll let me know. 4 Q. Sir, after you met with Mr. Mangone at Reno's restaurant, 5 did Milio Management start working with Mangone? 6 A. I'm sorry. Repeat the question. 7 Q. After you had the meeting at Reno's restaurant on or about 8 April 14, 2006, did Milio Management start working with Anthony 9 Mangone? 10 A. Yeah, we started using him for other projects, I would say 11 shortly thereafter we had -- we started using him. 12 Q. When you hired Mangone in April 2006, what was the status 13 of the Longfellow project and the city council? 14 A. It was pretty much nowhere, stalled. 15 Q. Sir, do you know Zehy Jereis? 16 A. Yes. 17 Q. Was he at meeting at Reno's on April 14, 2006? 18 A. No, he was not, not at Reno's. No. 19 Q. How did you first meet Zehy Jereis? 20 A. I met him about a week later at Anthony Mangone's office. 21 I was asked to come up for a meeting, and he was there. That's 22 when I met him. 23 Q. Let me now show you what you have in front of you as 24 Government Exhibit 711. You have to pull it out of your 25 folder, sir. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1287 C2sQann3 F. Milio - Direct 1 A. Sorry. 2 Q. Do you recognize this item? 3 A. I do. 4 Q. What do you recognize it to be? 5 A. A calendar entry from Microsoft Outlook. 6 Q. For who? 7 A. Franco Milio. I wrote it. 8 Q. For what date? 9 A. April 21, 2006. 10 Q. Does this meeting relate to the Longfellow project? 11 A. It -- well, yes, essentially, it does. 12 MR. ARONWALD: Your Honor, again I am going to object 13 to the leading. 14 MR. HALPERIN: It's Rule 611(c) allows developing 15 testimony on background. 16 THE COURT: You know what, we're getting away from the 17 background. We're getting to the meat. This is not the 18 background. 19 Q. What, if anything, did this meeting relate to, sir? 20 A. It was relating to a meeting that I attended at Anthony 21 Mangone's office on April 21, 2006. 22 Q. About what project? 23 A. Longfellow Walgreens. 24 Q. Thank you. Did you provide this document to the 25 government? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1288 C2sQann3 F. Milio - Direct 1 A. I did. 2 MR. HALPERIN: Your Honor, the government offers 3 Government Exhibit 711 into evidence. 4 MR. ARONWALD: No objection. 5 MR. SIANO: No objection, your Honor. 6 THE COURT: Admitted. 7 (Government's Exhibit 711 received in evidence) 8 MR. HALPERIN: Mr. Turk. Thank you. 9 THE COURT: Could the folks in the back please sit 10 down? Thank you. 11 Q. Sir, above the black line upper left corner, whose name is 12 that? 13 A. Mine. 14 Q. What's the subject line? 15 A. FM, meeting with Anthony Mangone at 151 Broadway, 16 Hawthorne, New York 10532. 741-2929. 17 Q. What was located at 151 Broadway, Hawthorne, New York? 18 A. Anthony Mangone's office. 19 Q. What county is Hawthorne, New York in? 20 A. Westchester. 21 Q. What's the date? 22 A. April 21, 2006. 23 Q. Who was at the meeting on April 21, 2006? 24 A. Myself, Anthony, Zehy, I believe my cousin Dominick might 25 have been there as well. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1289 C2sQann3 F. Milio - Direct 1 Q. Had you ever met Zehy Jereis before this meeting on 2 April 21, 2006 at Mangone's office? 3 A. No. 4 Q. Did you know Zehy Jereis was going to be there at the 5 meeting? 6 A. No. 7 Q. At the meeting who introduced you to Zehy Jereis? 8 A. Anthony Mangone. 9 Q. At the meeting, what, if anything, did Mangone say about 10 why Jereis was there? 11 A. He brought -- he mentioned that he was there, perhaps he 12 could help out with the Longfellow project. 13 Q. What was discussed? 14 A. How Sandy Annabi was in favor of putting senior housing 15 there, and I really just remember us talking about Longfellow, 16 why it was being stalled, and I have a very -- I have a 17 recollection that the way we ended the meeting just left me a 18 little -- little surprised because he had -- I remember him 19 getting up -- 20 Q. When you say "him" -- 21 A. I'm sorry, Zehy. I mean, Zehy Jereis getting up and just 22 telling Anthony, "look, let me know what you want me to do," 23 and that was pretty much how the meeting ended. 24 Q. Mr. Milio, do you see the Zehy Jereis you've been 25 discussing here in the courtroom here today? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1290 C2sQann3 F. Milio - Direct 1 A. Yes. 2 Q. Please point to him and state where he's sitting. 3 A. He's standing up. 4 THE COURT: Indicating Zehy Jereis. 5 MR. SIANO: No objection. 6 Q. Mr. Milio, do you see the Sandy Annabi you've been 7 discussing here in the courtroom today? 8 A. I do. 9 Q. Please point to her and state where she's sitting? 10 A. She's right in front of me, behind attorney -- Mr. Carbone. 11 THE COURT: Indicating Ms. Annabi. 12 Five minutes, Mr. Halperin. 13 MR. HALPERIN: Thank you. 14 Q. Directing your attention to June 20, 2006, was there a real 15 estate committee meeting that day? 16 A. Yes. 17 Q. Did you attend? 18 A. Yes. 19 Q. Did the issue of Longfellow come up? 20 A. Yes. 21 Q. Which attorney was there, if any, on your behalf? 22 A. Al DelBello. 23 Q. Why DelBello and not Mangone? 24 A. Like I previously stated earlier, when I had mentioned 25 Anthony's name to Al DelBello, he wanted -- didn't -- he didn't SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1291 C2sQann3 F. Milio - Direct 1 want Anthony involved. 2 Q. Let me direct your attention to a town hall meeting on or 3 about June 21, 2006, the day after the real estate committee 4 meeting. Did you attend that town hall meeting? 5 A. I did. 6 Q. What was the town hall meeting about? 7 A. It was a meeting held by the then Mayor Phil Amicone, he 8 was the mayor at that point, and there were commissioners 9 there, police commissioners, it was, I guess, a town hall 10 meeting for that neighborhood, and they discussed issues at 11 hand -- crime and such and so forth. 12 Q. Did you talk to Councilwoman Annabi at the town hall 13 meeting? 14 A. I did. 15 Q. When did you talk to her, before or after the meeting? 16 A. It was after. 17 Q. Where was it when you had a conversation? 18 A. I was in the rear of the -- it was after the meeting. It 19 was towards the rear of the meeting, towards the rear of the 20 building. 21 Q. Was it a private conversation? 22 A. It was. 23 Q. Who was there in the conversation? 24 A. Myself and Sandy Annabi. 25 Q. What did the two of you discuss? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1292 C2sQann3 F. Milio - Direct 1 A. We were discussing the project. Anthony's name came up at 2 that point, and -- 3 Q. When you say Anthony -- 4 A. I'm sorry, Anthony Mangone, about us using him, his name 5 came up, and she was just at that point -- I remember her 6 telling me I can use him, but she'd also told me I didn't have 7 to use him, but I could use him, and pretty much that was the 8 nuts and bolts of the conversion. 9 A. How would you describe her reaction to the fact that you 10 were considering using Mangone? 11 A. She was -- my reaction was she was very much in favor. 12 MR. HALPERIN: Judge, this might be a good time. 13 THE COURT: In that case, let's break for lunch, and 14 I'll see you at 2:00. Don't discuss the case. Keep an open 15 mind. 16 (Luncheon recess) 17 AFTERNOON SESSION 18 2:00 P.M. 19 (In open court; jury not present) 20 THE DEPUTY CLERK: Case on trial continued. 21 The government and defendants are present. The jurors 22 are not. 23 THE COURT: Before the jurors come in, Mr. O'Neill has 24 had two juror contacts or has had two jurors approach him. 25 Juror No. 3, Ms. Euphemia Reid approached him and said that she SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1293 C2sQann5 1 had spoken to her employer this weekend, and her employer had 2 indicated that the employer, who I can't remember, I believe 3 she's in health care. 4 THE DEPUTY CLERK: Eastchester Health Care. 5 THE COURT: Eastchester Health Care was only paying 6 for ten days of jury service. Mr. O'Neill is going to contact 7 the employer to obtain additional information. We will deal 8 with that when we have to deal with it. 9 The other juror was Juror No. 12, Mr. Timmins, who 10 corralled Mr. O'Neill and said that he served on a board of an 11 organization with a woman named possibly Eustacia Bender, and 12 he wondered if that person was somehow related to Mr. Bender. 13 THE DEPUTY CLERK: Not certain on the first name, your 14 Honor. 15 THE COURT: And he's not certain on the first name, 16 right. So we are making inquiries about Ms. Reid's situation 17 before we bring her in for questioning. I don't know what you 18 want me to do about Mr. Timmins. 19 MR. CARBONE: Your Honor, we can inquire of Mr. Bender 20 whether he has any relationship to a Eustacia. 21 THE COURT: He's not sure of the first name is the 22 issue. What I'd like to do is get from him the name of the 23 organization, I think. Get from Mr. Timmins. 24 THE DEPUTY CLERK: I'm not sure of the name he'll 25 know. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1294 C2sQann5 1 THE COURT: The name of the organization, the name of 2 the individual, then you can make an inquiry of Mr. Bender. 3 I'd rather do it that way than bring him out in court and 4 separate him from the other jurors and make a big to-do about 5 it. 6 MR. CARBONE: That makes sense. 7 MR. HALPERIN: Judge, one other brief logistical 8 issue, which is simply that Antonio Milio, who the government 9 will call after Franco Milio, will have an Italian interpreter 10 available for Antonio Milio in court. I just wanted to let the 11 Court know. 12 MR. SIANO: Excuse me, your Honor -- 13 THE COURT: The rule is really simple. Either he 14 testifies in Italian or he testifies in English. 15 MR. SIANO: He testified in the grand jury without an 16 interpreter, Judge. 17 THE COURT: I see no need to have an Italian 18 interpreter. 19 MR. SIANO: He testified in the grand jury and said he 20 could speak English. 21 THE COURT: Mr. Siano. Mr. Siano, please. 22 There will not be an interpreter sitting here to give 23 him a word here and a word there. That's not the way it's 24 done. I will not allow it. End of discussion. End of 25 discussion. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1295 C2sQann5 1 You testify in one language or the other, and, 2 frankly, if he testified -- if it was good enough for the grand 3 jury, it's good enough for here. 4 The other thing I that was called to my attention by 5 my deputy that six months ago I committed to give my annual 6 address and pep talk to members of the first year class at 7 Cardozo Law School next Monday, the 5th of March. That's also 8 at 4:00. Everything is at 4:00. So we will be ending at 3:30 9 on Monday. 10 How are we doing, Mr. Halperin? How are we doing? 11 MR. HALPERIN: We're doing well, your Honor. The 12 government's case is moving right along. I don't want to give 13 an estimate yet as to when -- 14 THE COURT: How many more witnesses do we have? 15 MR. HALPERIN: I'd say roughly 28 or so, 25, but many 16 of them are very short, so I do think that -- 17 THE COURT: At this rate, we will call everyone in 18 Yonkers. 19 MR. HALPERIN: Well, no. The second half of the case, 20 Judge, deals with the mortgages from the banks. There are a 21 lot of little witnesses. I do think -- 22 THE COURT: I don't think Ms. Annabi thinks there are 23 little witnesses. 24 MR. HALPERIN: We obviously started Longfellow. We're 25 done with the presentation on Ridge Hill for the most part. I SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1296 C2sQann5 1 think the Longfellow testimony, depending on how long cross 2 takes for certain witnesses, will take most of this week, maybe 3 into the beginning of next week, but I'm not even sure. Then 4 we will have a full week from the government the next week, and 5 maybe a very little bit the following week, but that would be 6 pretty much it from the government. 7 MR. ARONWALD: All I know is that included with the 8 3500 material are some additional witnesses, who I can imagine 9 only relate to Ridge Hill, former city council member 10 Martinelli among them, so I don't really know -- 11 THE COURT: Maybe they've decided they've called 12 enough former city council members from Yonkers. How many 13 times can we listen to this story, Mr. Aronwald? 14 MR. ARONWALD: As far as the defense case is 15 concerned, your Honor -- 16 THE COURT: I ain't asking yet. Unless you want to 17 tell me. 18 MR. SIANO: Judge, Mr. Carbone and I are discussing an 19 issue with regard to the witness who is on the witness stand at 20 the present time. Mr. Franco Milio made some consensual 21 recordings at the behest of the government. Of particular 22 concern to me is a consensual recording of a conversation that 23 Mr. Franco Milio had with Mr. Anthony Mangone in a car, I 24 believe it was on March 24, 2008. 25 Mr. Carbone and I have had a conversation about it. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1297 C2sQann5 1 He tells me it's the government's present intention not to play 2 that conversation. I've told him I want to offer that 3 conversation, and I want to play it. It is a conversation in 4 which Mr. Milio while he was cooperating with the government, 5 and Mr. Mangone, who during the period of time he is alleged to 6 be part of the conspiracy that the government indicted on 7 January 2010 -- 8 THE COURT: The original conspiracy. 9 MR. SIANO: -- the original, alleging that he was part 10 of that conspiracy, and it's a conversation between the two of 11 them in which Mr. Milio discusses with Mr. Mangone where the 12 bribe money went, and that's the general subject matter of the 13 conversation. 14 And I've told Mr. Carbone I wish to play that 15 conversation. I have acknowledged that the government has a 16 mechanical problem in that they don't have it in the building 17 today. I've accepted that representation by Mr. Carbone. 18 However, Mr. Carbone tells me he intends to oppose its 19 admissibility, and I don't want Mr. Franco Milio leaving the 20 building until we get a chance to address this issue. I, for 21 the life of me, don't understand how this doesn't come in, but 22 here we are. 23 THE COURT: I would like to understand why these 24 issues don't get brought to my attention until now. 25 MR. SIANO: Because Judge, it wasn't, until I saw SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1298 C2sQann5 1 where we were in this direct and how it was going, and I looked 2 at the exhibits, and this conversation is not among the 3 plethora of electronic evidence that the government intends to 4 offer. 5 I talked to Mr. Carbone about it, and in discussing 6 both the mechanical side of it and the substantive side of it, 7 I want to make sure I made a full and honest presentation as to 8 where we stood. Again, I don't mind waiting until tomorrow to 9 get to the conversation, but if we are going to have to deal 10 with admissibility issues, I don't want Mr. Frank Milio off the 11 stand. 12 MR. CARBONE: Judge, just to be clear, this was a tape 13 that was turned over two years ago. 14 THE COURT: I don't care about that. 15 MR. CARBONE: I know you don't. I want to make a 16 complete and full record. 17 THE COURT: I don't care when you turned it over. 18 He's obviously aware of the tape and what's on it. And the 19 issue is, is Mr. Milio going to be served with a subpoena so 20 that he returns on Mr. Siano's case so that we can listen to 21 the tape or is there something that's not admissible about the 22 tape? 23 MR. CARBONE: Judge, the substance of our discussions 24 have been, and what we've advised Mr. Siano, is that if he 25 proffers some legitimate evidentiary basis to admit the tape, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1299 C2sQann5 1 we will certainly stipulate as to its authenticity and who the 2 participants are. We don't see that it's admissible. 3 THE COURT: Well, let me say that on the basis of what 4 he said so far, he's satisfied relevance. 5 MR. CARBONE: But, Judge, it should be treated like 6 it's a prior statement of the witness. So if he wants to ask 7 the witness about the tape, then he should certainly be 8 permitted to do so if he -- 9 THE COURT: He can ask the witness about the contents 10 of the tape and then play the tape to impeach, I understand 11 that. 12 MR. CARBONE: If, in fact, the witness says something 13 inconsistent, then he should absolutely be permitted to. 14 THE COURT: Absolutely. Positively. 15 MR. CARBONE: So that's our position. We haven't said 16 that absolutely no under no circumstances the tape shouldn't be 17 played. We just don't think you can play the tape for no good 18 reason. You have to lay a foundation, treat it as any other 19 prior statement. 20 THE COURT: As any other prior statement which is 21 hearsay and you have to come within and accept it or you have 22 to use it to impeach. I understand that. 23 MR. CARBONE: So we're in agreement, your Honor. He 24 just learned about this -- 25 THE COURT: Well, I think, but I don't really know -- SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1300 C2sQann5 1 I obviously haven't heard the tape. I don't know what's on the 2 tape. I don't know why it's being offered by the defense. I 3 don't know. You are not putting it in. I'm not requiring you 4 to put it in. You don't have to put it in. 5 MR. CARBONE: Judge, I think really what Mr. Siano 6 wants to get out of the tape, Mr. Milio went into Mr. Mangone 7 with a ruse, and what he said was in words and substance: "Did 8 you give any of the money to a third party" to get Mr. Mangone 9 to talk about the money that went to Ms. Annabi, and the 10 witness will explain, if asked, that that was a ruse. He had 11 no reason to believe anyone else got the money besides 12 Mr. Jereis and Ms. Annabi. So I don't think that the tapes -- 13 first of all, it's a lengthy tape with a wide range of 14 discussions on it. 15 THE COURT: That doesn't make any difference to me at 16 all. Let's talk about lengthy. Let's talk about the lengthy 17 amount of time that Mr. Jereis and Ms. Annabi are possibly 18 going to go to jail if they should happen to be convicted. 19 That's the lengthiness I'm worried about. I worry more about 20 that lengthiness than anything else. 21 MR. HALPERIN: It's lengthy and deals with other 22 subject matters that don't have anything to do with the passing 23 of the money. 24 THE COURT: That's entirely possible. I don't know. 25 I haven't heard the tape. Is it possible that Mr. Siano only SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1301 C2sQann5 1 wishes to introduce a portion of the tape? 2 There is certainly -- there is, however, a 3 time-honored method of getting a prior statement in front of 4 the jury for an appropriate purpose. If this is not a 5 statement that was made in furtherance of the conspiracy and if 6 it was made at behest of the government, it is not a statement 7 that was made in furtherance of a conspiracy. So it can't be 8 an exception to the hearsay rule under the co-conspirator 9 hearsay doctrine. 10 Therefore, if there is some independent evidentiary 11 basis to introduce it, I will consider that. If Mr. Siano 12 wishes to cross-examine this witness on the subject of what was 13 said on that tape, and then to impeach him, should the answers 14 be inconsistent, I expect the government to provide the tape so 15 Mr. Siano can do that. 16 MR. CARBONE: Judge, we're happy to do that -- 17 THE COURT: If his recollection needs to be refreshed, 18 we'll give him headphones so that he can listen to the tape. 19 MR. CARBONE: Judge, we're happy to provide the tape 20 again. We don't have it here -- 21 THE COURT: I hear you. It does seem odd that it 22 wouldn't be here, but, OK, Mr. Milio -- don't worry, Mr. Siano, 23 Mr. Milio is not going anywhere. 24 MR. SIANO: Thank you, Judge. 25 THE COURT: May I have the jury? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1302 C2sQann5 1 MR. HALPERIN: Can we ask one final question? The 2 court said Mr. Mr. Antonio Milio can testify either all in 3 Italian or all in English. If that's the case, we'd ask, since 4 he's more comfortable with Italian, Italian is his first 5 language, we'd ask him to testify all in Italian with the help 6 of the interpreter. 7 THE COURT: I'm happy to do that. It is a perfectly 8 fair subject for cross-examination as to his credibility, as to 9 his credibility and everything else that he testified in the 10 grand jury without the assistance of an interpreter. You want 11 to do that, you think that's going to look good to the jury, 12 you be my guest. 13 THE DEPUTY CLERK: Jury entering. 14 (Continued on next page) 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1303 C2sQann5 1 (Jury present) 2 THE COURT: Mr. Milio, please come back up. You're 3 still under oath. 4 Mr. Halperin, you're up. 5 I'm sorry, folks, we had some administratrivia to deal 6 with. 7 MR. HALPERIN: Thank you, your Honor. 8 BY MR. HALPERIN: 9 Q. Good afternoon, Mr. Milio. Before the break, we were 10 talking about a June 21, 2006 town hall meeting, is that 11 correct? 12 A. Yes. 13 Q. You were talking about a conversation you had with 14 Councilwoman Annabi? 15 A. That's correct. 16 Q. Now, around this time, did you receive a phone call from 17 Anthony Mangone? 18 A. I did. 19 Q. Where were you when Mr. Mangone called you? 20 A. I was in my office. 21 Q. What did Mangone say to you? 22 A. Mangone at that time mentioned to get this job done or get 23 the approval done, it was going to take a sum of money, $30,000 24 and -- cash, and giving this money to Ms. Annabi, I would get 25 the approval, named as designated developer. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1304 C2sQann5 1 Q. The approval for which project? 2 A. For the Longfellow -- Longfellow Walgreens project. 3 Q. What did Mangone say about why Councilwoman Annabi wanted 4 the cash? 5 A. He told me that he wanted it -- wanted it before she went 6 away, apparently she was going away next month, and he wanted 7 it before that time. He wanted -- yeah, he wanted me to give 8 it to him before that time. 9 Q. What did he say about what form the money should be in? 10 A. Cash. 11 Q. What did he say about who you should bring the $30,000 in 12 cash to? 13 A. He told me to bring it into his office. He specifically 14 told me that if I -- if he wasn't there, it was to be given to 15 his secretary, Jill. 16 Q. What, if anything, did you later learn about whether 17 Councilwoman Annabi had taken a trip? 18 A. I learned that she did take the trip on or about July, mid 19 July of that year. 20 Q. Where was the trip to? 21 A. Jordan. 22 Q. After you had this conversation with Mangone, what did you 23 do next? 24 A. After I had that conversation with Anthony, I called my 25 father, explained to him what had just happened, and he was SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1305 C2sQann5 1 going to bring it up himself essentially. 2 Q. At some point after that conversation, did someone give 3 Mangone the $30,000? 4 A. Yes. 5 Q. Who? 6 A. My father. 7 Q. In what form? 8 A. Cash. 9 Q. Were you with your father when your father gave Mangone the 10 money? 11 A. No, I was not. 12 Q. About when did your father give the cash to Mangone? 13 A. Late June, early July, around that time. 14 Q. What year? 15 A. 2006. 16 Q. I direct your attention to July 10. Did you receive an 17 email from Anthony Mangone that day? 18 A. I did. 19 Q. I will ask you to look at what's been marked as Government 20 Exhibit 700. Do you recognize that document, sir? 21 A. I do. 22 Q. What do you recognize it to be? 23 A. It's an email from Anthony Mangone to myself. 24 Q. What's the date? 25 A. July 10, 2006. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1306 C2sQann5 1 Q. What project was this related to? 2 A. Longfellow. 3 Q. Did you provide this email to the government? 4 A. I did. 5 MR. HALPERIN: Your Honor, the government offers 6 Government Exhibit 700 into evidence. 7 MR. ARONWALD: I need to see it, Judge. Just give me 8 a second. No objection. 9 THE COURT: Mr. Siano? 10 MR. SIANO: No objection. 11 THE COURT: Admitted. 12 (Government's Exhibit 700 received in evidence) 13 Q. Mr. Turk, if we can display 700, please. 14 Mr. Milio, who is the email from? 15 A. Anthony Mangone. 16 Q. And the name at very top of the page is whose? 17 A. Franco Milio, mine. 18 Q. What's the date of the email? 19 A. July 10, 2006. 20 Q. Time? 21 A. 4:20 p.m. 22 Q. Who is the email sent to? 23 A. Myself. 24 Q. Subject line? 25 A. Longfellow. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1307 C2sQann5 1 Q. Please read the email in a slow voice, please. 2 A. Here are the conditions: (1) 20 percent of the units will 3 be offered at below market rent housing. 4 (2) The city council will have an independent 5 appraisal conducted. Those results will not affect the 6 approval which will happen tomorrow. The appraisal is being 7 done for her own selfish political gain so that when people in 8 her district ask if she conducted one as she said she would, 9 then she has cover. 10 (3) The applicant will advertise for a period of six 11 months the availability of housing for senior citizens. The 12 applicant will further work with the second district council 13 member in accepting recommendations for consideration of 14 seniors her office comes in contact with for housing. 15 Q. Directing your attention to number one, what, if anything, 16 did you discuss with Mr. Mangone about condition number one? 17 A. I wasn't overly concerned with it. Anthony explained to me 18 that the 20 percent below market rent housing is nothing to be 19 worried about because if an apartment was renting for a 20 thousand dollars, I could rent it for 975 or anything under the 21 market, and that would satisfy that condition. 22 Q. What, if anything, does condition number one say about how 23 much below market rent you have to offer the units for? 24 A. It said 20 percent. It said nothing specifically as far as 25 money. It says 20 percent of the units will be offered at SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1308 C2sQann5 1 below market rent housing. 2 Q. But what is said about how much below market rent housing 3 it has to be? 4 A. It doesn't say anything specifically. 5 Q. OK. In terms of number two, what, if any, discussions did 6 you have with Mangone? 7 A. I was concerned with number two, and he told me not to 8 worry about it; that Zehy Jereis was an appraiser. 9 Q. Why were you concerned with number two? 10 A. I was concerned because it left a lot of leeway whether an 11 appraisal was conducted later showing some astronomical number 12 of some sort and just another way to make my life miserable, 13 and he told me, don't worry, Zehy is the appraiser, and I felt 14 comfortable with that. 15 Q. Directing your attention to the second sentence of number 16 two, read that again, please. 17 A. Sure. Those results will not effect the approval which 18 will happen tomorrow. 19 Q. So on July 10 when you received this email, what was your 20 understanding of when the approval of the Longfellow project 21 would occur? 22 A. The following day, July 11, 2006. 23 Q. What, if anything, did Mr. Mangone say about condition 24 number three? 25 A. He said, he said that basically I would be referred people SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1309 C2sQann5 1 and not to be worried because I would have the right to screen 2 them, and it's up to me to decide if they are eligible, and I 3 had no problem with that. 4 Q. Based on this email, what was your impression about whether 5 this project would be approved now? 6 A. I was under the impression it was going to be approved. 7 Q. What, if anything, did Mangone say to you about why 8 Councilwoman Annabi wanted these three conditions? 9 A. Basically because she wanted to have cover. She was long 10 opposed to the project and now she would have a way to 11 represent to the district why she decided to support the 12 project. 13 Q. In number two, the last sentence of number two, "the 14 appraisal is being done for her own selfish political gain," 15 who did you understand that to be referring to? 16 A. Sandy Annabi. 17 Q. What, if anything, did Mangone tell you about how 18 significant these changes would be? 19 A. Minor. 20 Q. Let me direct your attention to July 11, 2006. Did 21 Mr. Mangone call you? 22 A. He did. 23 Q. What did he say? 24 A. He had told me that day that everything was ready to go; 25 that -- SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1310 C2sQann5 1 Q. In terms of what? 2 A. Oh, I'm sorry, there was a special meeting that day. 3 July 11 was a special session for the Ridge Hill project to be 4 voted on to move along, and he told me that I would be on that 5 meeting, I just need to get all the council members -- I hadn't 6 been put on the agenda yet, but I needed to get unanimous 7 approval essentially because of such an on-short notice, but it 8 was a done deal, not to worry, and if I get put on the agenda, 9 fine, I was to speak to the people who had him put -- allowed 10 it to go on the agenda on short notice, and he said that she 11 was very nervous that night. Ridge Hill was a big project. 12 She was very nervous, and she just -- he made it sound like she 13 just wanted to get it done and over with. 14 Q. And who is the she? 15 A. Oh, Sandy Annabi. 16 Q. What, if anything, did Mangone tell you about who you 17 should have the agenda item put on to the city council agenda 18 through? 19 A. It was to speak to my attorney, Al DelBello, and have him 20 speak to them. He wasn't able to get it on. 21 Q. Did you attend a July 11, 2006 council meeting that 22 evening? 23 A. I did. 24 Q. At the meeting, what happened with the Longfellow project? 25 A. I walked in there, and I remember Chuck Lesnick making an SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1311 C2sQann5 1 announcement that Longfellow was not going to be heard. 2 Q. Who is Chuck Lesnick? 3 A. Chuck Lesnick is the president or was or still is the 4 president of the city council, and he made an announcement that 5 it was not going to be heard that night; that it was only Ridge 6 Hill. And he -- at that point I took it upon myself to speak 7 to the two city council members to see if they could allow it 8 to be put on that night's agenda. 9 Q. Was it able to be put on that night's agenda? 10 A. No. 11 Q. Were you concerned when it wasn't able to be put on the 12 agenda that night? 13 A. No. 14 Q. Why not? 15 A. I felt very comfortable that it was approved, and that it 16 was going to move forward. I was led to believe it was going 17 to happen, and I was just more upset that it wasn't happening; 18 that it was long awaited for, but at that point I really wasn't 19 nervous in the very least. 20 Q. Directing your attention to September 26, 2006, did the 21 city council vote on Longfellow that day? 22 A. They did. 23 Q. Let me now show you or ask you to pull out what's been 24 marked as Government Exhibit 706. Do you recognize this item, 25 sir? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1312 C2sQann5 1 A. I do. 2 Q. What do you recognize it to be? 3 A. Resolution allowing me to be named designated developer for 4 the project. 5 Q. Resolution from what body? 6 A. It was resolution from a city council meeting held that 7 night, that evening. 8 Q. What day was that again? 9 A. End of September of 2006. Let me see. I believe it was -- 10 September 26, 2006. 11 Q. What project did this resolution relate to? 12 A. It related to Walgreens Longfellow. 13 MR. HALPERIN: Your Honor, the government offers 14 Government Exhibit 706 into evidence. 15 MR. ARONWALD: 706? No objections. 16 MR. SIANO: No objection. 17 THE COURT: Admitted. 18 (Government's Exhibit 706 received in evidence) 19 Q. Mr. Turk, let's please display 706. If you can maximize 20 the top half of the page including the first five paragraphs, 21 please. 22 Mr. Milio, if you could read paragraphs three through 23 five on that page, please. 24 A. Sure. 25 "Whereas, in response to a request for proposals SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1313 C2sQann5 1 issued by the Yonkers Community Development Agency on behalf of 2 the city of Yonkers, Milio Management, Inc., hereafter Milio, 3 has expressed interest in redeveloping city owned property on 4 the west side of the city of Yonkers; and 5 Whereas Milio has offered to acquire from the city 6 that certain property situated at 33 Ashburton Avenue, formerly 7 operated as Public School Number 6, Section 2, Block 2094, Lot 8 40, such property being referred to hereinbelow as the School 6 9 property; and 10 Whereas, Milio has offered to acquire from the city 11 that certain property situated at 23 Mulberry Street, formerly 12 operated as Longfellow Junior High School, Section 2, Block 13 2062, Lot 25, such property being hereinbelow referred to as 14 the Longfellow property, and such property and the School 6 15 property being sometimes hereinbelow referred to collectively 16 as the city properties; and" -- 17 Q. For paragraph four what school is that referring to, sir? 18 A. Longfellow Junior High School. 19 Q. The fourth paragraph from the top? 20 A. Sorry, Public School Number 6. 21 Q. And the next paragraph below is related to what school? 22 A. Longfellow Junior High School. 23 Q. Mr. Turk, let's put up page 5, please. 24 Let's maximize the other portion. Let's maximize the 25 paragraph in all caps in the middle of the page please starting SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1314 C2sQann5 1 "this resolution." Blow up that paragraph, please. Sir, can 2 you read that allowed? 3 A. "This resolution was adopted by the city council at a 4 stated city council meeting held on Tuesday, September 26, 2006 5 by a vote of seven to zero or 7-0." 6 Q. Were you named as a designated developer that night? 7 A. I was. 8 Q. For both schools? 9 A. That's correct, yes. 10 Q. What was the city council vote margin there? 11 A. It was unanimous. 12 Q. Seven to nothing? 13 A. That's correct, yes. 14 MR. HALPERIN: A moment, your Honor? Nothing further. 15 MR. ARONWALD: Your Honor, with the Court's 16 permission, Mr. Siano will lead with cross this time. 17 THE COURT: That's fine. 18 MR. ARONWALD: Appreciate that, your Honor. 19 CROSS-EXAMINATION 20 BY MR. SIANO: 21 MR. SIANO: May I proceed, your Honor? 22 THE COURT: Please do, Mr. Siano. 23 MR. SIANO: Thank you. 24 Q. Good afternoon, Mr. Milio. My name is Anthony Siano. I 25 represent the defendant, Zehy Jereis. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1315 C2sQann5 F. Milio - Cross 1 A. Hello. 2 Q. Did I hear you testify on direct, sir, that you entered a 3 guilty plea in federal court in White Plains some weeks ago? 4 A. Yes. 5 Q. Let me show you what's been previously marked as 3520 R, 6 sir. Do you recognize that document? 7 A. I do. 8 Q. What do you recognize it to be, sir? 9 A. Cooperation agreement. 10 Q. And do you recognize your signature on the last page? 11 A. I do. 12 MR. SIANO: I offer into evidence 3520R, your Honor. 13 MR. HALPERIN: No objection. 14 THE COURT: Admitted. 15 (Defendant's Exhibit 3520R received in evidence) 16 Q. Now, you signed that document on what day, sir? 17 A. February 3, 2012. 18 Q. February 3 of 2012. That was just approximately three 19 weeks ago, is that right? 20 A. Yes. 21 Q. And you had in fact been cooperating with the government 22 for a substantial period of time prior to that, isn't that 23 right? 24 A. Yes. 25 Q. You had been talking to government agents, and in fact you SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1316 C2sQann5 F. Milio - Cross 1 made consensual recordings in an effort to cooperate with the 2 government, isn't that right? 3 A. Yes. 4 Q. Prior to you signing that document, sir, did you have 5 occasion to discuss it with your own attorney? 6 A. I did. 7 Q. You specifically understood the descriptions on the second 8 page, page 2 of that exhibit, with regard to what offenses were 9 and were not covered by the agreement? 10 A. I read it, yes. 11 Q. Well, did you understand it, sir? 12 A. Yes. 13 Q. All right. Now, it says here that you participated in a 14 tax evasion scheme in which you failed to pay applicable 15 payroll taxes on wages paid to employees. Did you in fact do 16 that? 17 A. I did. 18 Q. In fact, there came a point in time pursuant to that 19 agreement where you appeared in federal court in front of Judge 20 Briccetti, and you entered a guilty plea, isn't that right? 21 A. Yes. 22 Q. I place in front of you what's been marked as 3520U, sir, 23 and I ask you to look at that. Take as long as you like, sir. 24 Is that in fact a transcript of the proceedings at which you 25 pleaded guilty? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1317 C2sQann5 F. Milio - Cross 1 A. Appears to be, yes. 2 Q. Well, sir, you were in court that day with your father 3 standing next to you, isn't that right? 4 A. Yes. 5 Q. And you heard your father enter a guilty plea? 6 A. I did. 7 Q. What language was he speaking? 8 A. English. 9 Q. What language were you speaking? 10 A. English. 11 Q. What language was the Judge speaking? 12 A. English. 13 Q. What language was your lawyer speaking? 14 A. English. 15 Q. What language were the prosecutors speaking? 16 A. English. 17 Q. Direct your attention to page 40 of that transcript, sir. 18 Do you see commencing at page 17 what is attributed to F. 19 Milio? 20 A. Where? What line? 21 Q. Page 40, starting at line 17. Excuse me page 40, line 17. 22 A. OK. 23 Q. I would ask you to just read that on to the next page 24 through line 10. 25 A. OK. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1318 C2SUANN4 F. Milio - cross 1 Q. Do you recall that you spoke those words in front of the 2 judge on that day? 3 A. I did. 4 Q. Did you in fact describe, sir, that during the years 2006 5 and 2008 you used unreported rental income to pay your 6 employees' salaries in cash totaling about $2,103751? 7 A. Yes. 8 Q. Sir, at the time you said those things, you were 9 identifying, essentially, unreported wages for three years of 10 Milio Management, isn't that correct? 11 A. Yes. 12 Q. And you knew at the time you stood in front of the judge 13 that Milio Management had in fact been paying employees in cash 14 for decades, isn't that right? 15 A. I wouldn't say decades, but I knew -- yes. 16 Q. You started in the mid '90s with your father's company, you 17 testified on direct? 18 A. That's correct. 19 Q. And there was a longstanding practice in place of only 20 paying workers in cash off the books, isn't that right? 21 A. That's correct. 22 Q. And there was a system in place when you joined the 23 company, wasn't there? 24 A. Yes. 25 Q. And other members of your family were responsible for SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1319 C2SUANN4 F. Milio - cross 1 keeping track of the hours and putting cash in envelopes and 2 putting it into the hands of your workers on a regular basis, 3 isn't that right? 4 A. Yes. 5 Q. That was all there when you came to the company? 6 A. Yes. 7 Q. And you continued it, isn't that right? 8 A. Yes. 9 Q. And this plea agreement you have with the government 10 requires you to account for only three years of those wages in 11 front of Judge Bricetti, isn't that right? 12 A. Yes. 13 Q. Now, when you paid these workers in cash, did you withhold 14 Social Security? 15 A. No. 16 Q. Did you withhold workers' compensation? 17 A. No. 18 Q. Did you withhold state income taxes? 19 A. No. 20 Q. Did you withhold any Yonkers taxes for any of the workers 21 who worked at your buildings in Yonkers? 22 A. No. 23 Q. And that practice continued for decades, isn't that right, 24 Mr. Milio? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1320 C2SUANN4 F. Milio - cross 1 Q. Did you give the government a list of all of these workers? 2 A. Yes. 3 Q. Now, you see in that same page earlier on line 2, where you 4 identify the total sum, page 41, line 2, of corporate and 5 personal income taxes unpaid? Do you see that number? 6 A. Yes. 7 Q. Do you recall that number from the day you pleaded guilty? 8 A. Yes. 9 Q. You said in front of Judge Bricetti that through the years 10 2006 through 2008, you had evaded corporate and personal income 11 taxes totally $2,172,554. Was that true at the time you said 12 it? 13 A. Yes. 14 Q. You didn't start evading corporate and personal income 15 taxes in 2006, did you, Mr. Milio? 16 A. That is correct. 17 Q. You started evading corporate and personal income taxes the 18 minute you joined Milio Management, isn't that right? 19 A. Yes. 20 Q. And other members of your family participated in that, 21 isn't that correct? 22 A. Yes. 23 Q. Other members of your family took cash out of the business, 24 isn't that right? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1321 C2SUANN4 F. Milio - cross 1 Q. Carmela did? 2 A. OK, yes. 3 Q. Is that true? 4 A. Yes. 5 Q. Romeo did? 6 A. Yes. 7 MR. HALPERIN: Objection to others, Judge. 8 MR. SIANO: I am asking members of the family, Judge. 9 THE COURT: He said yes to that. We don't need to go 10 through an entire list of all of the members of his family. 11 Q. Did anybody get paid on the books of Milio Management? 12 A. Yes. 13 Q. Who? 14 A. I did. 15 Q. How about Antonio? 16 A. No. 17 Q. Now, the number stated here is for three years, isn't that 18 right? 19 A. Yes. 20 Q. Nevertheless, you had these 36 properties that were 21 generating the income that led to the unpaid taxes for decades, 22 isn't that right? 23 A. Yes. 24 Q. And none of those income taxes, corporate or personal, were 25 paid either, were they? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1322 C2SUANN4 F. Milio - cross 1 A. That's correct. 2 Q. And nevertheless you stood in front of Judge Bricetti and 3 promised to account criminally for only those three years, 4 isn't that right? 5 A. Yes. 6 Q. In addition to paying people off the books, your company 7 made a practice of employing a particular kind of worker, isn't 8 that right? 9 A. What kind? 10 Q. Your father made a practice of hiring undocumented aliens, 11 isn't that right? 12 A. Not necessarily. 13 Q. Well, were there a substantial number of undocumented 14 aliens that worked for Milio Management? 15 A. Yes. 16 Q. Who did that hiring? 17 A. Myself, my father. 18 Q. And that was a regular practice in the business from the 19 time you joined Milio Management in 1995? 20 A. '97, yes. 21 Q. '97. 22 And it continued right up until the time you began to 23 cooperate with the government, isn't that right? 24 A. Yes. 25 Q. Now, you testified earlier, sir, that you had an initial SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1323 C2SUANN4 F. Milio - cross 1 meeting with Mr. Mangone at a restaurant called Reno's, isn't 2 that right? 3 A. Yes. 4 Q. And at that meeting, you and a number of your family 5 members were in attendance, isn't that right? 6 A. Yes. 7 Q. When you went to the meeting, did you know that a gentleman 8 named Nick Spano was going to be there? 9 A. No. 10 Q. I believe you went to this meeting, I believe you said, it 11 was sometime in early 2006? 12 A. Yes. 13 Q. How long had you lived -- excuse me -- how long had Milio 14 Management been active in Yonkers as of 2006? 15 A. 20-plus years. 16 Q. And I take it your family business was familiar with the 17 name Spano, weren't you? 18 A. Yes. 19 Q. And you knew that in fact he was a senator at that time? 20 A. Yes. 21 Q. How many of your buildings use fuel oil? 22 A. About a dozen. 23 Q. Any of them buy fuel from Spano Fuel? 24 MR. HALPERIN: Objection. Relevance. 25 THE COURT: Objection sustained. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1324 C2SUANN4 F. Milio - cross 1 Q. I take it that you were familiar with the fact that 2 Nicholas Spano was a very significant political force in 3 Westchester County as of the time he walked into Reno's in 4 early 2006, isn't that right? 5 A. I honestly really never dealt with him. 6 Q. I didn't ask you if you dealt with him, sir. 7 MR. SIANO: I ask the court reporter to read back the 8 question. 9 (Record read) 10 Q. I take it you knew when he walked into Reno's in April of 11 2006, you knew Nicholas, Spano was a significant force in 12 Westchester politics, isn't that right? 13 MR. HALPERIN: Objection. Relevance. 14 THE COURT: Overruled. 15 A. Yes. 16 Q. Nevertheless, you told the government that when Mr. Spano 17 was at that meeting, you didn't think much of it? 18 A. I didn't. 19 Q. Now, did anybody from the Milio side of the equation invite 20 Mr. Spano to that meeting? 21 A. No. 22 Q. In fact you knew it was Mr. Mangone who had brought 23 Mr. Spano to that meeting, isn't that right? 24 A. I assumed that. I didn't know that he had invited him. 25 Q. Didn't Mr. Mangone tell you that at some point? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1325 C2SUANN4 F. Milio - cross 1 A. I can't recall. Perhaps. I can't recall. 2 Q. Now, I believe you testified, sir, that shortly after the 3 April meeting in Reno's, you went to a meeting at Mr. Mangone's 4 office and for the first time met Mr. Zehy Jereis? 5 A. That is correct. 6 Q. Isn't it a fact, sir, that in that meeting, all that 7 Mr. Jereis said to anybody was, he turned to Anthony and said, 8 let me know what you want to do? 9 A. That is correct. 10 Q. And he left? 11 A. Yes. 12 Q. And you never met Mr. Jereis ever again until you saw him 13 here in court, isn't that right? 14 A. Yes. 15 Q. And no one ever told you other than Anthony Mangone, that 16 Mr. Jereis had anything to do with this subject matter you 17 testified here today? 18 MR. HALPERIN: Objection. Hearsay. 19 THE COURT: Overruled. 20 A. Repeat the question. 21 THE COURT: Did anyone other than Mr. Anthony Mangone 22 ever tell you that Mr. Jereis had anything to do -- I gather -- 23 the Longfellow project? 24 MR. SIANO: The Longfellow project. 25 THE COURT: Yes or no? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1326 C2SUANN4 F. Milio - cross 1 THE WITNESS: No. 2 MR. SIANO: Thank you. 3 BY MR. SIANO: 4 Q. Now, the government posted up here on the screen a series 5 of these little electronic diary entries. You saw those Mr. 6 Milio? 7 A. Today? 8 Q. Yes. 9 A. No. 10 MR. SIANO: Mr. Turk, could you put up that last 11 appointment. Any one of them will do. 12 THE WITNESS: I understand now. Yes. 13 Q. I don't want to confuse you, Mr. Milio, I want you to 14 understand my question. 15 In addition to those diary entries, you kept other 16 electronic type notes of your transactions on behalf of Milio 17 Management, didn't you. 18 A. I did. 19 Q. I'm going to show you what was marked at 3520T. Do you 20 recognize 3520T? 21 A. I do. 22 Q. What do you recognize it to be, sir? 23 A. My task notes. 24 Q. These are in fact contemporaneous notes you keep of events 25 and transactions you participate in on behalf of Milio SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1327 C2SUANN4 F. Milio - cross 1 Management, isn't that right? 2 A. Yes. 3 Q. You make and keep them at or about the time in which they 4 are dated, isn't that right? 5 A. Yes. 6 Q. And you gave those to the government, isn't that right? 7 A. Yes. 8 Q. Did the government, before you came here today, show you 9 your task notes, as you described them? 10 A. Yes. 11 Q. Did they show you your plea allocution? 12 A. I don't understand the question. 13 Q. The document I put in front of you, sir, where you pleaded 14 guilty in front of Judge Bricetti, did they show you that 15 before you came here today? 16 A. No. 17 Q. Did they show you your grand jury testimony? 18 A. No. 19 Q. Did they show you the reports of the Federal Bureau of 20 Investigation about the things you said to the FBI? 21 A. No. 22 Q. Would you take a look at your task notes, sir, and tell me 23 if the name Zehy Jereis or the initials ZJ appear anywhere in 24 your task notes for the Longfellow project, and take your time. 25 (Pause) SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1328 C2SUANN4 F. Milio - cross 1 A. I don't see it here. 2 Q. You went through all eight pages, sir; I want you to take 3 your time and be certain? 4 A. OK. I don't see it here. 5 Q. It is not there, is it, Mr. Milio? 6 A. No, it is not. 7 Q. Now, you recall giving a number of interviews to agents of 8 the FBI, isn't that right? 9 A. Yes. 10 Q. In fact, you just said a minute ago, you were not shown the 11 report of your interview in preparation for your appearance 12 here today, were you? 13 A. Shown for me to read out of? No. 14 Q. Isn't it a fact, sir, that you told the FBI that you 15 believed the payment to Mr. Mangone took place one or two days 16 before the Yonkers real estate committee meeting on June 14, 17 2006? 18 A. Yes. 19 Q. And is that your recollection as you sit there now? 20 A. No. 21 Q. Do you have a different recollection now? 22 A. It had to have been after, the money transfer had to have 23 been after. 24 Q. Had to have been after? 25 A. That's correct. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1329 C2SUANN4 F. Milio - cross 1 Q. And what is the basis for had to have been after? 2 A. The basis for it to have to be after is further 3 recollection it wasn't before that meeting, before the date you 4 have there. 5 Q. Do you have a date, sir, that you recall the money being 6 paid? 7 A. I don't. 8 Q. And nevertheless in 2008 when you were interviewed by the 9 FBI, you told them it took place one or two days before the 10 June 14, 2006 real estate deal? 11 A. That's correct, I did. 12 Q. And during that period of time the FBI was helping you put 13 on recording devices and go out and make consensual recordings 14 in this case? 15 A. Yes. 16 Q. You never did meet with Mr. Jereis, did you? 17 A. When. 18 Q. When you were wearing the recording device? 19 A. No. 20 Q. You never did meet with Ms. Annabi when you were wearing 21 the recording device? 22 A. No. 23 Q. You met with Mr. Mangone, though, didn't you. 24 A. Yes. 25 Q. In fact, in one of those meetings you sat in the car and SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1330 C2SUANN4 F. Milio - cross 1 talked to Mr. Mangone at length about where your bribe money 2 had gone? 3 A. OK. 4 Q. Do you recall that conversation? 5 A. Yes, I recall having a conversation that day. 6 Q. And you recall it being in the car? 7 A. Yes. 8 Q. And you recall talking to Mr. Mangone about where the money 9 went, isn't that right? 10 A. Not entirely. 11 Q. Do you recall, sir, asking him, did any of the money go to 12 Kubaseck? 13 A. Not entirely, no. 14 MR. SIANO: Pursuant to our prior conversation, your 15 Honor, I am going to ask that Mr. Milio stay and come back to 16 us tomorrow morning? 17 THE COURT: Well, Mr. Milio will come back to us. 18 MR. SIANO: Thank you, Judge. 19 BY MR. SIANO: 20 Q. Do you recall discussing the volume of currency that was 21 laying about the Milio Management offices? Do you recall 22 discussing that with the FBI? 23 A. Yes. 24 Q. In fact, there was a very substantial amount of cash about 25 in the Milio Management offices in 2006 and 2007 and 2008, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1331 C2SUANN4 F. Milio - cross 1 isn't that right? 2 A. Yes. 3 Q. In fact, you told the FBI there was so much cash there that 4 you could steal money from your father and he would never know? 5 A. Yes. 6 Q. Now, after your father transferred this cash to 7 Mr. Mangone, the project wasn't approved in July, was it? 8 A. No. 9 Q. It wasn't approved in August, was it? 10 A. No. 11 Q. Your father took 40,000 dollars in cash to Mr. Mangone, 12 isn't that what you remember? 13 A. I remember being told to bring $30,000 for Sandy Annabi. 14 Q. How much money did your father bring to Mr. Mangone? 15 A. 40,000. 16 Q. And that's what I asked you? 17 A. That's correct, yes. 18 Q. So we are talking about how much currency your father, 19 Antonio Milio, carries to Mr. Mangone in or about June of 2006, 20 and it was $40,000, wasn't it? 21 A. That's correct. 22 Q. And it was $40,000 packaged in a particular way, wasn't it? 23 A. I don't know. 24 Q. You didn't count the money? 25 A. No. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1332 C2SUANN4 F. Milio - cross 1 Q. Where did you get it from? 2 A. It came in through the office, but it doesn't necessarily 3 mean I counted it or counted it right before giving it -- 4 before transporting it or bringing it to Anthony's office. I 5 didn't count it. 6 Q. Who did? 7 A. I'm not sure. I'm not sure. 8 Q. Did you pick it up from the office? 9 A. No. 10 Q. You say it came through the office. What do you mean by 11 that answer, sir? 12 A. Cash would come in through the rental properties, come in 13 to the office. Payment would be received. It doesn't mean, to 14 answer your question, that I counted the money, packaged it a 15 certain way and gave it to my father. 16 Q. Let's talk about that for a minute before we move on to the 17 $40,000. 18 You have several hundred apartments that you own, 19 isn't that right? 20 A. Yes. 21 Q. And they are spread all over the Bronx and various 22 communities like Mount Vernon, Yonkers and Mount Kisco? 23 A. Not Mount Kisco. 24 Q. Ossining? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1333 C2SUANN4 F. Milio - cross 1 Q. Do your rents end in round numbers of 100? 2 A. No. 3 Q. They end in fractions, as I might call it, specific dollars 4 and specific cents every month, isn't that right? 5 A. Yes. 6 Q. And, nevertheless, the money that was handed to your father 7 was 100 dollar bills, isn't that right? 8 A. I'm not sure. 9 Q. Are you familiar with how the cash is handled inside the 10 offices of Milio Management? 11 A. Yes. 12 Q. And on a routine basis that cash is counted and converted 13 into 100 dollar bills, isn't it? 14 A. Not converted, no. 15 Q. How does it turn into 100 dollar bills? 16 A. You take the 100 dollar bills that are given and you keep 17 those 100 dollar bills. 18 I don't understand the question. 19 Q. So you assemble or harvest the 100 dollar bills? 20 A. Yes. 21 Q. Is there a pattern or practice associated with Milio 22 Management's relationship with its tenants that encourages 23 paying in cash? 24 A. No. 25 Q. It just happens that the tenants pay in cash? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1334 C2SUANN4 F. Milio - cross 1 A. Yes. 2 Q. So you don't know the form that the $40,000 that was paid 3 to Mr. Mangone was in at the time it was paid? 4 A. I don't know. 5 Q. You gave your father $30,000, you said? 6 A. I don't recall giving my father any money. 7 Q. I thought you said, sir, you brought $30,000 to your 8 father? 9 A. No, I didn't. 10 Q. I apologize. 11 Did you take your father to Mr. Mangone's office? 12 A. No. 13 Q. He went by himself? 14 A. Yes. 15 Q. And he reported to you that he had paid Mr. Mangone 16 $40,000? 17 A. He had reported to me that he had given -- I remember him 18 calling me, telling me he gave the money. That's what I 19 remember. 20 Q. You just remember "the money"? 21 A. Yes. 22 Q. Now, at any time after your father reported that he gave 23 Mangone the money, did anybody complain to Mr. Mangone that the 24 project wasn't moving forward fast enough? 25 A. Such as? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1335 C2SUANN4 F. Milio - cross 1 Q. When you didn't get the vote on July 11, did anybody from 2 the Milio operation complain to Mr. Mangone? 3 A. I don't specifically remember anything, no. 4 Q. And when it wasn't on the agenda in August, did anybody 5 complain? 6 A. No. It had been explained she wasn't in the country. 7 Q. That's what Mr. Mangone said to you? 8 A. Yes -- oh, I don't remember if Anthony told me, Mr. Mangone 9 told me, but I remember she was going to come back and hadn't 10 come back. I specifically remember she was going to visit the 11 king -- or something about her going to visit a king and -- 12 Q. Who else besides Anthony Mangone were you talking with 13 about Sandy Annabi? 14 A. I don't recall anyone specifically. 15 Q. Did you ever complain to Mr. DelBello about this payment 16 that had not gotten you results in July and August? 17 A. No. 18 Q. You never brought it up with Mr. DelBello? 19 A. I did not. 20 Q. Never called up anybody except Anthony Mangone? 21 A. Regarding the payment? 22 Q. Yes. 23 A. Yes, that's correct. 24 Q. Now, there came a point in time, sir, where you became 25 aware by way of a subpoena that there was some law enforcement SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1336 C2SUANN4 F. Milio - cross 1 interest in your company, isn't that right? 2 A. Yes. 3 Q. You had a conversation with Mr. Mangone about it? 4 A. Yes. 5 Q. Did you go see Mr. Mangone? 6 A. Yes. 7 Q. Did you go alone? 8 A. I did, yes. 9 Q. You had a conversation with Mr. Mangone? 10 A. It wasn't just myself in the room. I went alone. 11 Q. Who did he bring into the room? 12 A. No. My father and my sister were there already. 13 Q. So when you got there, your father and your sister Carmela 14 were there? 15 A. That's correct. 16 Q. And you had a conversation, the three of you, with Anthony 17 Mangone? 18 A. Yes. 19 Q. Was any other lawyer present? 20 A. Later on, yes. 21 Q. Who was the lawyer that came later on? 22 A. Michael Santangelo. 23 Q. Who did you understand Mr. Santangelo to be? 24 A. Either a partner or an associate attorney, a colleague. 25 Q. Well, there was a sign on the law firm up there in SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1337 C2SUANN4 F. Milio - cross 1 Hawthorne, wasn't there? 2 A. Yes. 3 Q. And was Mr. Mangone's name on the sign? 4 A. Yes. 5 Q. And was Mr. Santangelo's name on the sign? 6 A. That's correct, yes. 7 Q. Mr. Santangelo sat in with his partner Anthony Mangone in 8 the meeting and discussed the subpoena, isn't that right? 9 A. Yes. 10 Q. Was there any discussion at that time about the payment of 11 cash? 12 A. No. 13 I'm sorry. 14 Q. That's all right. I paused. That was fair. 15 Was there any discussion of the payment of the cash to 16 Mr. Mangone? 17 A. No. 18 Q. How long did the conversation last? 19 A. I am not 100 percent sure how long. 20 Q. Your best estimate, sir? 21 A. An hour, an hour and 15, and hour and a half. 22 Q. Was there a second conversation with Mr. Mangone about the 23 subject matter of the subpoena in which you participated? 24 A. Yes. 25 Q. When did that take place? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1338 C2SUANN4 F. Milio - cross 1 A. About a week later. 2 Q. Where was that conversation? 3 A. At his office. 4 Q. Any particular place in the office? 5 A. Downstairs in the basement -- or it was a ground level -- 6 downstairs, yes. 7 Q. It was in the hot tub room? 8 A. Yes. 9 Q. Had you had any prior meetings with Mr. Mangone in the hot 10 tub room? 11 A. No, I never did. 12 Q. When you went into the hot tub room with Mr. Mangone, was 13 anybody else there with him? 14 A. No. 15 Q. And what did you say to him and what did he say to you 16 about the subject matter of the subpoena and the government 17 investigation? 18 A. The conversation went around the $30,000. 19 Q. It went around? 20 A. It was about the $30,000. 21 Q. Mr. Mangone in fact told you not to mention the $30,000, am 22 I right? 23 A. That's correct. 24 Q. Did you have a separate conversation, apart from your 25 conversation with Mr. Mangone, with Mr. Santangelo? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1339 C2SUANN4 F. Milio - cross 1 A. Yes. 2 Q. You had a conversation with Michael Santangelo? 3 A. Yes. 4 Q. You were talking to him about the same subject matter, 5 isn't that right? 6 A. Relating to the subpoena and the money, yes. 7 Q. The subpoena. And when you saw the subpoena, you thought 8 of the money, isn't that right? 9 A. I was talking to Mr. Santangelo about everything, yes. 10 Q. The subpoena didn't say tell us about the $30,000, did it? 11 A. I'm sorry? 12 Q. The subpoena didn't say, tell us about the $30,000? 13 A. Honestly, I don't recall if it did or didn't at this point. 14 Q. Nevertheless, you told Michael Santangelo about the money? 15 A. Yes. 16 Q. And then after that, did you have another conversation with 17 Mr. Mangone? 18 A. That was the one I was just telling you about. 19 Q. Ah. And he told you what Mr. Michael Santangelo's reaction 20 was, didn't he? 21 A. Yes. 22 MR. HALPERIN: Objection. Hearsay. 23 MR. SIANO: Mr. Mangone was talking to him. 24 THE COURT: I don't have a question. 25 Q. Did Mr. Mangone say to you in the hot tub meeting what SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1340 C2SUANN4 F. Milio - cross 1 Michael Santangelo's reaction was? 2 A. Yes, he did. 3 Q. And what did he say? 4 MR. HALPERIN: Objection. Hearsay. 5 THE COURT: The objection is sustained. It is double 6 hearsay. 7 Q. Did he communicate to you anything about Mr. Santangelo's 8 then existing state of mind after you had spoken to him about 9 the $30,000? 10 THE COURT: Sorry. It doesn't work. 11 Q. Did Mr. Santangelo ever talk to you again about this case? 12 A. No. 13 Q. Did there come a point in time where you were offered the 14 opportunity by anybody at Mr. Mangone's firm to speak to any 15 other lawyers? 16 A. Yes. 17 Q. And how did that happen, sir? 18 A. He told me that day in the basement. He told me that 19 the -- that to choose from a list, some attorneys, and to seek 20 the attorney, the first attorney on that list. 21 Q. So somebody at the firm gave you a list? 22 A. Yes. 23 Q. Who was that? 24 A. Jill. 25 Q. Jill Allen? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1341 C2SUANN4 F. Milio - cross 1 A. Yes. 2 Q. That was Mr. Mangone's assistant? 3 A. I am not sure if she was his assistant or secretary. I 4 thought she was his secretary maybe -- yes. 5 Q. And Ms. Allen gave you a list of four lawyers? 6 A. I don't recall exactly the amount of the attorneys. 7 Q. There were several lawyers on the list? 8 A. That's correct. 9 Q. Then down at the hot tub, Mr. Mangone said to pick the 10 first name on the list? 11 A. Yes. 12 Q. And who was that? 13 A. Lawrence Diagiansante. 14 Q. Did he counsel you with respect to your communications with 15 Mr. Diagiansante? 16 A. I left there under the impression not to mention the 17 $30,000. 18 Q. Isn't it a fact that Mr. Mangone told you to not mention 19 the money to Mr. Diagiansante? 20 A. It was made clear not to mention it. 21 Q. And who made that clear to you? 22 A. Anthony Mangone. 23 Q. I believe you testified on direct that it was Mr. Mangone 24 who gave you the news that you needed to provide $30,000 to 25 facilitate the approval of your program over there at SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1342 C2SUANN4 F. Milio - cross 1 Longfellow, isn't that right? 2 A. To get it approved, yes. 3 Q. Mangone told you that? 4 A. That's correct. 5 Q. And he told you to bring $30,000 to the office? 6 A. Yes. 7 Q. And he told you that he didn't even have to be there when 8 the money came, isn't that right? 9 A. That's correct. 10 Q. He told you you could leave it with his secretary, 11 Ms. Allen? 12 A. That's correct. 13 Q. Because she was cool? 14 A. That's correct. 15 Q. Now, do you recall being asked about the subject matter of 16 when you delivered the money -- excuse me -- when your father 17 delivered the money to Mr. Mangone's office? Do you recall 18 being asked about that in the grand jury appearance of August 19 9, 2008, which is in front of you, I believe? 20 THE COURT: The question is do you recall. Don't look 21 at the document. 22 Q. Do you recall being asked about the subject matter of when 23 these events with Mr. Mangone and saying deliver the money, you 24 can deliver it to Jill, it is cool? Do you remember? 25 A. Somewhat, yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1343 C2SUANN4 F. Milio - cross 1 Q. And you were asked about it in the grand jury? 2 A. Yes. 3 Q. And do you recall telling the grand jury that you told your 4 father and he brought the money to Anthony in June of 2006? 5 A. That is correct. 6 Q. And that's what you told the grand jury, isn't that right? 7 A. Yes. 8 Q. In fact you told the grand jury that the total amount your 9 father brought was actually $40,000? 10 A. OK. Yes. 11 Q. It's not OK unless you remember it, Mr. Milio? 12 A. Can I see it? 13 Q. Absolutely. You have to tell me you don't remember first? 14 A. I don't remember 100 percent. 15 THE COURT: In that case you can look. Don't read it 16 out loud. 17 Q. It is 25 and 26, Mr. Milio. 18 THE COURT: See if that jogs your memory. 19 THE WITNESS: I don't have it. 20 MR. SIANO: 3520A, your Honor, for the witness? 21 THE COURT: Thank you. 22 THE WITNESS: Which page? I think you said 26? 23 MR. SIANO: I think I did. 25 and 26, I believe. 24 (Pause) 25 THE WITNESS: OK. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1344 C2SUANN4 F. Milio - cross 1 BY MR. SIANO: 2 Q. In fact you told the grand jury that in fact the total was 3 $40,000, 30 plus 10, isn't that right? 4 A. 30,000 on page 25 and the 10,000 on page 26. 5 Q. Thank you, Mr. Milio. 6 In the conversation you had in the hot tub room with 7 Mr. Mangone, do you recall him telling you about who the people 8 were that knew about the payment of the $30,000? 9 A. I don't remember. 10 Q. Grand jury, page 34, line 8, if you would, just to 11 yourself, Mr. Milio. 12 A. Sure. OK. 13 Q. Now, do you recall Mr. Mangone telling you that the only 14 people that knew about the money -- 15 MR. HALPERIN: Objection. Hearsay. 16 MR. SIANO: Yes, your Honor, I will ask the question a 17 different way. 18 Q. Do you recall what Mr. Mangone told you about who knew 19 about the money? 20 A. Well, from reading this, it refreshed my memory, yes. 21 Q. That's what it is supposed to do. 22 THE COURT: Now, put it down. 23 Q. Put it down. 24 A. Basically, myself -- 25 MR. HALPERIN: Objection. Hearsay. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1345 C2SUANN4 F. Milio - cross 1 THE COURT: The objection is sustained. Double 2 hearsay. 3 Q. Who was speaking to you? 4 A. In the basement? 5 Q. Yes. 6 A. Anthony Mangone. 7 Q. What did he tell you? 8 MR. HALPERIN: Objection. Hearsay. 9 THE COURT: OK, guys. Come on up. 10 11 (Continued on next page) 12 13 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1346 C2SUANN4 F. Milio - cross 1 (At the sidebar) 2 THE COURT: I understand, of course, in furtherance of 3 the conspiracy. I understand that. But it also says -- I am 4 reading it to myself. 5 So, yes, the statement is admissible as a statement in 6 furtherance of the conspiracy to the extent that there isn't 7 double hearsay in it. It is the Santangelo part of the 8 conspiracy -- 9 MR. HALPERIN: The only problem, Judge, is that the 10 defense can offer a statement -- 11 MR. SIANO: Judge, it is not Santangelo that is 12 talking; it is Mangone that is talking. 13 THE COURT: I understand. 14 MR. SIANO: He is talking about the past. 15 (In open court) 16 THE COURT: Take a break. 17 I can't whisper about this. 18 (At the sidebar) 19 MR. ARONWALD: Your Honor, can I participate in the 20 break. 21 THE COURT: You may. 22 MR. ARONWALD: I will be right back. 23 (Jury not present) 24 (In open court) 25 THE COURT: Sir, could you go out to that exit sign SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1347 C2SUANN4 F. Milio - cross 1 and stand out there. 2 (Witness not present) 3 (At the sidebar) 4 THE COURT: The issue is for what purpose are you 5 offering Mangone's statement that persons other than himself 6 knew about -- 7 MR. SIANO: No, no, Judge, that Mr. Mangone omits any 8 reference to Mr. Jereis when they are all still involved in 9 this. And he says the only -- Mangone told me, the only people 10 that knew about -- 11 THE COURT: I see. I am sorry. See, I am focused on 12 Santangelo. I apologize. 13 MR. HALPERIN: Judge, the money -- 14 MR. SIANO: They asked that question exactly that way, 15 who passed the money? Mangone. These are the only people that 16 he mentioned -- he never mentioned Zehy Jereis at the time. As 17 to my client, Judge, this is very important. 18 THE COURT: I see. I can understand that. 19 MR. HALPERIN: Can I respond? 20 THE COURT: Yes. 21 MR. HALPERIN: The issue is, he defense can't offer a 22 statement in furtherance of the conspiracy under 801(d)(2)(E) 23 unless they are agreeing that there is a conspiracy unless they 24 agree. They cannot offer a statement under 801(d)(2). 25 THE COURT: I have never had anybody raise that issue. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1348 C2SUANN4 F. Milio - cross 1 MR. SIANO: I have a simple response for that, Judge. 2 I don't have to have admissible evidence for your Honor to rule 3 on the admissibility of evidence. That is 104. 4 MR. HALPERIN: Judge, the other issue is that they can 5 obviously ask Mr. Mangone about these statements to their 6 heart's content. 7 THE COURT: That I understand, but that doesn't answer 8 this question. 9 I am sorry. You said what section? 10 MR. HALPERIN: 801(d)(2), statements in furtherance of 11 a conspiracy. 12 THE COURT: The statement is offered against a party 13 and is a statement by a co-conspirator of a party during the 14 course and in furtherance of the conspiracy. The contents of 15 the statement shall be considered but are not alone sufficient 16 to establish the declarant's authority. 17 Forgive me. No one has ever suggested this to me 18 before. 19 Your position is not apparent from the words on the 20 page. 21 MR. HALPERIN: Well, it says a statement against the 22 party, so the government can offer -- 23 THE COURT: The government can, plainly -- 24 MR. HALPERIN: I have never heard of -- 25 MR. SIANO: I am offering it against the government. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1349 C2SUANN4 F. Milio - cross 1 THE COURT: I was just going to say, yes, you are. 2 MR. SIANO: Judge, I think that the rule is 104. 3 THE COURT: Wait a minute. 4 MR. HALPERIN: We are not charged in a conspiracy, 5 last I checked. 6 THE COURT: That is true. The statement has to be of 7 the conspirator's, a party -- the government is not a party to 8 any conspiracy. 9 MR. SIANO: It is certainly admissible. At the time 10 that the statement is made, Mr. Mangone is a member of the 11 conspiracy, and it is a statement that is offered against him. 12 THE COURT: He is not a party. 13 MR. ARONWALD: But I don't believe the rule is limited 14 to the government being the only one who can be the proponent 15 of the statement. 16 THE COURT: Well, we are going to have to come back 17 tomorrow with some learning on this. We don't have to pursue 18 this now. We have to have him come back anyway so that he can 19 listen to the tape. 20 You think it is 104. 21 MR. SIANO: Your Honor, I don't have to concede the 22 existence of a conspiracy for your Honor to make a ruling. 23 THE COURT: 104 is preliminary -- 24 MR. SIANO: A preliminary matter, Judge. 25 THE COURT: This is not a preliminary matter. That I SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1350 C2SUANN4 F. Milio - cross 1 am prepared to rule on. This is not a preliminary matter. It 2 has nothing to do with 104. 3 MR. HALPERIN: While we are here, we are also -- 4 THE COURT: I want to focus on this issue and I want 5 to either get it resolved or get it deferred and then I will 6 change my pattern of thinking. One at a time. 7 MR. SIANO: I have said all that I want to say. 8 MR. CARBONE: We will submit a letter tonight. 9 THE COURT: All right. Submit a letter. 10 I am sorry. I am old and cranky and I am not capable 11 of jumping back and forth. You are 30-something. 12 MR. HALPERIN: I wish. 13 MR. ARONWALD: Judge, you are not old. I am old. 14 MR. HALPERIN: I didn't want to do it in front of the 15 jury, but we are going to object to the repeated gratuitous 16 references to the hot tub room. 17 THE COURT: Forget it. Don't. They were in a hot 18 tub. Big deal. 19 And I am sensitive to this because my name is 20 mispronounced all of the time. It is Bricetti. I appreciate 21 that is probably his grandfather's name, but it is Bricetti. 22 MR. HALPERIN: Could we have two minutes? 23 THE COURT: Yes. I need it. 24 (Recess) 25 THE COURT: The lawyers are present. The jury is not SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1351 C2SUANN4 F. Milio - cross 1 present. 2 I know perfectly well that this is not 104. 3 And I know perfectly well that the statement cannot be 4 admitted "against the government." 5 I think what can happen is that Mr. Siano or Mr. 6 Aronwald can ask Mr. Mangone what he said. And if Mr. Mangone 7 should say something that is contradicted by Mr. Milio, that 8 Mr. Milio can be called on the defense case to impeach 9 Mr. Mangone. I do believe that that is entirely possible and 10 within the rules. 11 MR. SIANO: I am listening to your Honor. 12 THE COURT: That is what occurred to me as I went back 13 and tried to piece through this. 14 MR. HALPERIN: That comports with our understanding as 15 well. 16 THE COURT: So no one needs to submit a letter. Let's 17 just do it that way. Either Mr. Mangone will admit that he did 18 not include Mr. Jereis on the list of people who knew where the 19 money had gone -- this would be a most peculiar admission -- or 20 you are free to call Mr. Milio back and I will advise Mr. Milio 21 that he is subject to recall. 22 MR. SIANO: That is perfectly fine, your Honor. 23 24 (Continued on next page) 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1352 C2SUANN4 F. Milio - cross 1 (Jury present) 2 FRANCO MILIO, resumed. 3 THE COURT: Have a seat. 4 You are still under oath. 5 Mr. Siano. 6 Thank you very much. We have gotten our problem 7 solved. 8 CROSS-EXAMINATION (Continued) 9 BY MR. SIANO: 10 Q. Now, Mr. Milio, do you have in front of you your 11 contemporaneous -- what do you call them -- program notes? 12 A. I do. 13 Q. I wonder if you would go to the last page of the exhibit 14 which is 3520T, I believe, Mr. Milio, is that correct? 15 A. Yes. 16 Q. Am I correct, sir, in my reading of these, they appear to 17 be sort of in two pieces, is that right; there appear to be a 18 couple of chronological sequences? 19 A. Yes. 20 Q. And this would be the second piece, isn't that right? 21 A. I'm sorry? 22 Q. At the back, that last page, is part of a sort of a second 23 chronological piece. There is a reference at the top of the 24 page to 4/27/06. 25 MR. SIANO: Just so that we can get the government on SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1353 C2SUANN4 F. Milio - cross 1 the same page, "to committee and on and on." I want to get you 2 on the same page. 3 THE COURT: Do you want to show him what page? 4 MR. SIANO: That's OK. 5 THE WITNESS: I have it. 6 BY MR. SIANO: 7 Q. You have the page; it says "to committee and on and on" at 8 the top? 9 A. Yes. 10 Q. In that page you in fact write down the developing 11 relationship with the Mangone law firm, isn't that right? 12 MR. HALPERIN: Objection to reading from the document. 13 MR. SIANO: I am just trying to get him focused, 14 Judge. 15 THE COURT: That is fine, Mr. Siano. 16 MR. SIANO: I am going to stop leading in a second, 17 Judge. 18 THE COURT: You can lead; it is not your witness. 19 MR. SIANO: I understand that, Judge. I just want to 20 get him focused. 21 BY MR. SIANO: 22 Q. In fact, there is a reference to 4/28/06, isn't that right? 23 A. Yes. 24 THE COURT: You can put that down. 25 Q. Did mr. Mangone introduce you to another lawyer at his firm SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1354 C2SUANN4 F. Milio - cross 1 that he assigned to work on your matters? 2 A. On the specific matter, yes. 3 Q. Meaning Longfellow? 4 A. No. 5 Q. Which matter? 6 A. That one specifically dealt -- shall I read the name, so we 7 know what we are talking about? 8 Q. Sure. 9 MR. HALPERIN: Objection. 10 THE COURT: Do you recall the name? Do you recall the 11 name as you sit here today? 12 THE WITNESS: Yes. 13 THE COURT: What is the name? 14 THE WITNESS: Matt Libis. 15 BY MR. SIANO: 16 Q. Mr. Libis worked for Mr. Mangone? 17 A. Yes. 18 Q. And he was assigned by Mr. Mangone to work for you? 19 A. For relating to another matter. 20 Q. What other matter? 21 A. Moss Square Road. 22 Q. That is another real estate development? 23 A. That's right. 24 MR. SIANO: No further questions, your Honor. 25 MR. ARONWALD: May I just hand something to Mr. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1355 C2SUANN4 F. Milio - cross 1 O'Neil, your Honor? 2 THE COURT: Of course. 3 CROSS-EXAMINATION 4 BY MR. ARONWALD: 5 Q. Mr. Milio, my name is William Aronwald. I am an attorney 6 and I represent Sandy Annabi in this case. 7 And you and I have never ever met, correct? 8 A. That's correct. 9 Q. I would like to talk to you a little bit about the amount 10 of cash that you generated or was generated that was on hand at 11 Milio Management. You told Mr. Siano that this was something 12 that had gone on or was a practice that was in effect from the 13 very day that you started working for the company, correct? 14 A. Yes. 15 Q. It would be fair to say that during the period of time that 16 you worked for Milio Management from 1990 to the present, the 17 practices that you testified -- 18 MR. HALPERIN: Objection to the time frame. 19 MR. ARONWALD: Sorry? 20 (Discussion off the record among counsel) 21 Q. I'm sorry. 1997. Is that what you said was your start 22 date? 23 A. Yes. 24 Q. During the entire period of time that you were at Milio 25 Management, the practices that you described, both on direct SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1356 C2SUANN4 F. Milio - cross 1 and on cross by Mr. Siano, those were practices that pretty 2 much all of the Milio family members were involved in? 3 A. My company, yes. 4 Q. Was the cash that was generated, was that cash always kept 5 at the offices of Milio Management? 6 A. Not always. 7 Q. In fact was the cash sort of split up and kept at various 8 locations? 9 A. No. 10 Q. Was any of the cash kept in your home or someplace selected 11 by you? 12 A. No. 13 Q. What about your father? 14 A. Yes. 15 Q. Any other family member storing any of this cash? 16 A. No. 17 Q. Now, with respect to your plea agreement, you agreed with 18 Mr. Siano that the agreement only holds you accountable for 19 those three years that are referred to in the transcript, 20 correct? 21 A. In the information? I don't understand. 22 Q. Well, the information charged you with tax evasion for 23 three years, correct? 24 A. Yes. 25 Q. You agree that those three years only represent a fraction SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1357 C2SUANN4 F. Milio - cross 1 of the time that you and the business were involved in this tax 2 evasion scheme? 3 A. Yes. 4 Q. And with respect to the scheme itself, I think you 5 testified on direct examination that, in addition to the 6 unreported cash rents and in addition to the unreported cash 7 that you paid to your employees and in addition to the use of 8 undocumented aliens, you also from time to time, Milio 9 Management, purchased properties? 10 A. Yes. 11 Q. And the purchase price of those properties was different on 12 paper than what the actual purchase price was, correct? 13 A. Yes. 14 Q. You testified that it was the practice of Milio Management 15 that there would be additional cash paid to the seller under 16 the table that would not be reflected on the purchase price, 17 correct? 18 A. Yes. 19 Q. And you are familiar with the fact that when there is a 20 closing, there is a HUD form, an HUD 1 form? 21 A. I am familiar with the form, but I believe it relates 22 mainly to small homes, yes. 23 Q. But in any event, to the extent that those forms had to be 24 filled out with respect to any of these real estate 25 transactions, the form would also be incorrectly filled out SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1358 C2SUANN4 F. Milio - cross 1 because it would not include the cash that was paid to the 2 seller under the table, correct? 3 A. If the form was filled out? 4 Q. Yes. 5 A. That's correct. 6 Q. It is true, is it not, that the amount of cash that was 7 paid under the table to the seller of the properties varied, 8 correct? 9 A. Yes. 10 Q. And it varied from say as little as, say, 25,000 to as much 11 as 300,000 dollars, correct? 12 A. Yes. 13 Q. So there was at least one instance where Milio Management 14 paid under the table to the seller of the property $300,000 in 15 cash, correct? 16 A. Yes. 17 Q. How long ago was that? 18 A. I believe, eight years ago. 19 Q. That $300,000 came from the pile of cash that was generated 20 and accumulated over the years from the cash rentals? 21 A. Yes. 22 Q. Now, by the way, with respect to the cash payments to your 23 employees, those cash payments were unreported, correct? 24 A. Yes. 25 Q. You didn't provide the employee with a W-2 or a 1099, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1359 C2SUANN4 F. Milio - cross 1 correct? 2 A. Correct. 3 Q. And you knew from your experience that W-2s and 1099s are 4 required to be provided not only to the employee, but also to 5 the Internal Revenue Service, correct? 6 A. Correct. 7 Q. So you knew at the time that you were not providing these 8 1099s or W-2s to your employees, you also were not filing these 9 1099s or W-2s with the Internal Revenue Service, correct? 10 A. Correct. 11 Q. You also knew that in addition to the employees being 12 responsible for filing federal income tax returns, they, like 13 all earners are also required to file state income tax returns 14 if they live in New York State, correct? 15 A. Yes. 16 Q. And the cash that was not reported on your federal income 17 tax returns -- and by the way, when I say "your," I am 18 including both your personal and the corporate returns of Milio 19 Management, so we understand when I say "your," I am not 20 referring to you alone, I am referring to you and the 21 corporation, OK? 22 A. That's correct. 23 Q. And, by the way, were there subsidiary corporations also 24 with Milio Management? 25 A. Just corporations -- I don't understand the question. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1360 C2SUANN4 F. Milio - cross 1 Q. Well, do you know whether Milio Management was a Subchapter 2 S corporation? 3 A. Yes. 4 Q. So a Subchapter S corporation means that it is a 5 pass-through corporation. Do you know what that means? 6 A. Yes. 7 Q. So the corporation has to file a tax return, but it doesn't 8 file taxes; it doesn't pay taxes? 9 A. Yes. 10 Q. Instead, the taxes are passed through to the owners of the 11 company? 12 A. That's correct. 13 Q. And so those owners of the company would have to report the 14 net profit, net income on their tax returns, correct? 15 A. That's correct. 16 Q. Now, so the only corporation that you are aware of that was 17 in existence at this time was Milio Management; there were no 18 subsidiary or spin-off companies? 19 A. There were. 20 Q. Were they subsidiaries or spin-offs? 21 A. I don't know what spin-off means, but there were other 22 Subchapter S corporations -- subsidiaries, I guess, would be 23 ideal. 24 Q. Subsidiary corporations for which -- withdrawn. 25 How many additional subsidiary corporations were SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1361 C2SUANN4 F. Milio - cross 1 there? 2 A. I don't know exactly off the top of my head, but I would 3 say about 15. 4 Q. Over what period of time? 5 A. Some were newer; some were older, give or take, 10 plus 6 years. 7 Q. Was any of the unreported cash income or any of the 8 unreported cash payroll with respect to any of the subsidiary 9 corporations? 10 A. Yes. 11 Q. So those subsidiary corporations also had to file corporate 12 tax returns? 13 A. That's correct. 14 Q. And the amount of income that was not reported or the 15 amount of cash payroll that was not reported, that was done not 16 only with respect to the corporate tax returns filed by Milio 17 Management, but also with respect to the corporate tax returns 18 that were filed by these other subsidiary corporations? 19 A. That is correct. 20 Q. And so that with respect to any of the income that was not 21 reported with respect to these subsidiary corporations, that 22 had a direct effect with respect to your personal income tax 23 returns as well? 24 A. Yes. 25 Q. As well as other members of the Milio family? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1362 C2SUANN4 F. Milio - cross 1 A. Yes. 2 Q. Now, your cooperation agreement or your plea agreement with 3 the government, that only relates to your being charged with a 4 tax evasion scheme relating to your personal and corporate tax 5 returns as they relate to Milio Management, correct? 6 A. Yes. 7 Q. So your plea cooperation agreement with the government does 8 not in any way hold you accountable for the unreported income 9 and understated taxes that were due and owing by both the 10 corporation and by the individuals that worked for the 11 corporation, correct? 12 A. I am under the impression that it encompasses the 13 subsidiaries. 14 Q. Well, now, with respect to your plea agreement, does your 15 plea -- withdrawn. 16 Was part of your agreement, was it your understanding 17 that the government was not going to refer or report your tax 18 offenses and the scheme to the New York State Department of 19 Taxation or to the district attorneys in Westchester County? 20 A. I'm not sure about that. 21 Q. You have not been charged with any state tax crimes by the 22 district attorney of Westchester County, correct? 23 A. That is correct. 24 Q. And you have no knowledge that the information which formed 25 the basis for your plea of guilty before Judge Bricetti, you SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1363 C2SUANN4 F. Milio - cross 1 have no knowledge that that information was provided to the 2 Westchester County District Attorney or the New York State 3 Department of Taxation, do you? 4 A. That's correct. 5 Q. By the way, was it your understanding that your agreement 6 would also cover not only you and your father but all of the 7 other members of the Milio family that were participants in the 8 tax evasion scheme that you described? 9 A. I believe so. 10 MR. ARONWALD: May I have a moment, your Honor? 11 Your Honor, may we have a sidebar, please? 12 THE COURT: All right. 13 I brought you in late this morning because we were 14 having sidebars to get them out of the way. 15 16 (Continued on next page) 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1364 C2SUANN4 F. Milio - cross 1 (At the sidebar). 2 THE COURT: Why are we having a sidebar? There is not 3 even a pending question. 4 MR. SIANO: Nothing in the 3500 material -- 5 MR. ARONWALD: Nothing in the 3500 material says 6 anything at all about it covering the members of the Milio 7 family. We have never heard of this before. It was not 8 provided as Brady or Giglio. 9 MR. HALPERIN: I don't understand what the issue is. 10 THE COURT: If he is wrong -- 11 MR. SIANO: A concession from the government that he 12 is wrong. How are we going to establish that. 13 THE COURT: The document is in -- 14 MR. SIANO: This is an interesting debate in front of 15 the jury, but it is not part of the agreement and we are asking 16 the government to concede -- 17 THE COURT: It is not here. 18 MR. SIANO: He says it is his understanding -- 19 MR. ARONWALD: -- that his family will not be 20 prosecuted. 21 THE COURT: Does this agreement represent the entire 22 understanding between the government and Mr. Milio? It is a 23 yes or no question? I ask this at every plea. 24 MR. HALPERIN: It does. 25 THE COURT: And is there any side agreement that Judge SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1365 C2SUANN4 F. Milio - cross 1 Bricetti was made aware of at the time that Mr. Milio took his 2 plea? 3 MR. HALPERIN: No. 4 MR. SIANO: Judge, is there a side agreement. 5 MR. ARONWALD: Did the government agree that they were 6 not going to prosecute his sister or his uncle or his cousins 7 as part of his cooperation. That's the question. 8 MR. CARBONE: There is no agreement. He testified to 9 that under oath. 10 MR. SIANO: That's not what we -- 11 THE COURT: We are not going to do this now because he 12 is coming back anyway. We are going to finish this afternoon 13 what we can finish. 14 Move on to a different topic other than the 15 prosecution of his family 16 17 (Continued on next page) 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1366 C2SUANN4 F. Milio - cross 1 (In open court) 2 BY MR. ARONWALD: 3 Q. Mr. Milio, other than you and your father, has any other 4 member of the Milio family that was involved in the tax evasion 5 scheme been charged with any federal crime up to this date? 6 A. No. 7 Q. And has any member of the Milio family, including you and 8 your father, been charged with a state tax offenses up to this 9 date? 10 A. Not that I am aware of. 11 Q. Well, certainly with respect to you and your father, you 12 know the answer with respect to that question is no, correct? 13 A. Yes. 14 Q. And you say that you are not sure about other members of 15 your family? 16 A. That's correct. 17 Q. Mr. Milio, are you suggesting that it is possible that 18 another member of the Milio family has been charged with state 19 tax offenses resulting from their participation in this tax 20 evasion scheme and you don't know it? 21 A. I would say no, they haven't. I think I would have heard 22 by now if they had. 23 Q. Thank you. 24 By the way, I realize I am jumping around so I 25 apologize, I just want to make sure I remember to ask -- and we SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1367 C2SUANN4 F. Milio - cross 1 will come back to this. 2 Ultimately in September of 2006, when the Longfellow 3 project was approved by a unanimous vote of seven to nothing by 4 the city council -- when I say the Longfellow project, I mean 5 where Milio Management was designated as the developer for the 6 Longfellow project by the city council in September of 2006 -- 7 that was the result of various discussions and negotiations 8 back and forth between you and Sandy Annabi, correct? 9 A. From when to when? 10 Q. Up to the time of the vote in September of 2006, let's say 11 in the month or two before the vote, you had had discussions 12 with Sandy Annabi, communications with her? 13 A. No. 14 Q. Did you send any emails to Sandy outlining the compromise 15 that Milio Management was willing to undertake to secure her 16 vote? 17 A. A month or two before, no, I don't recall. 18 Q. Well, do you recall ever sending an email to Sandy Annabi? 19 A. I believe to her assistant. 20 Q. And who was her assistant? 21 A. I think it was David Madranda, I believe it was. 22 Q. Mr. Milio -- 23 A. -- or was it a woman. I'm sorry. 24 THE COURT: It's OK. It's all right. 25 Q. Did you ever send an email to Sandy/Debbie on August 10, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1368 C2SUANN4 F. Milio - cross 1 2006? 2 A. Yes. 3 Q. That would be within two months of the September vote? 4 A. Yes, it was. 5 Q. And Sandy refers to Sandy Annabi? 6 A. Yes. 7 Q. And Debbie refers to who? 8 A. I believe -- yes, it was an assistant. 9 Q. Does the Debbie Kayal mean anything to you? 10 A. Yes. 11 Q. Is that the Debbie that is referred to in that email? 12 A. Yes. 13 Q. Let me place before you, sir, what's been marked for 14 identification Defense Exhibit 43 for identification. Would 15 you take a look at that, please? 16 (Pause) 17 A. Yes, I see it. 18 Q. Did you send that email to Sandy Annabi and her assistant 19 Debbie? 20 A. I don't recall sending it. I would have to look back in my 21 notes. 22 THE COURT: OK. You don't recall sending it. 23 THE WITNESS: That's correct. 24 THE COURT: Next question. 25 Q. Before appearing here today, how many times did you meet SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1369 C2SUANN4 F. Milio - cross 1 with the government in connection with your testimony? 2 THE COURT: Put that down, please, sir. 3 A. I don't recall exactly the number of times. 4 MR. ARONWALD: May I have a moment to consult with 5 government counsel? 6 (Discussion off the record among counsel) 7 Q. Could I have the document back, please? 8 A. Sure. 9 Q. The fact of the matter is that, ultimately what happened 10 was that there was a resolution which was the result of 11 negotiations and discussions that you had with Sandy Annabi 12 concerning how the Longfellow project apartments would be 13 marketed, correct? 14 A. Not necessarily. 15 Q. You testified earlier that initially Sandy Annabi wanted 16 only senior housing, wanted these apartments only for the 17 seniors, correct? 18 A. Yes. 19 Q. You talked about market rate housing. You are also talked 20 about affordable rate housing. I don't recall you being asked 21 to explain to the members of the jury what the difference is 22 between market rate and affordable rate housing, so let's start 23 with market rate housing. What is market rate housing? 24 A. My understanding of market rate housing is, it is free 25 market housing. An apartment that becomes available for rent, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1370 C2SUANN4 F. Milio - cross 1 any rent which the market can bear, if the rent for that 2 neighborhood, a one-bedroom apartment is $1,000, that's what 3 you can get. It is whatever the market allows to collect on 4 the rent and for that, given neighborhood or locality. 5 Q. Now, let's explain to the jury, please, what your 6 understanding is of affordable rate housing. 7 A. It is like a program, running like, to me, my 8 interpretation is, almost like Mitchell-Lama and those other 9 programs. It is something to that effect. 10 Q. I am not sure that the members of jury understand what 11 Mitchell-Lama housing is, so would you please explain what 12 affordable rate housing means in laymen's term, please? 13 A. My understanding of affordable housing or the Mitchell-Lama 14 housing, it is where the tenant moves into the apartment and 15 pays a certain amount of rent based on their income similar to 16 Section 8 that is also similar -- 17 THE COURT: Can I cut through this. 18 Is it the difference between all the traffic will bear 19 and subsidized housing; is that what you are talking about 20 here? 21 THE WITNESS: I'm sorry? 22 THE COURT: Mitchell-Lama and these things, we don't 23 want to get into all of these programs. That is very 24 technical. 25 THE WITNESS: Affordable housing, to me, represents a SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1371 C2SUANN4 F. Milio - cross 1 program of some sort, either state or federal subsidized -- 2 THE COURT: Subsidized housing? 3 THE WITNESS: That's correct. 4 THE COURT: So the tenant doesn't pay the full cost of 5 the housing. 6 THE WITNESS: Yes. 7 THE COURT: Thank you. 8 BY MR. ARONWALD: 9 Q. In essence, the tenant pays based upon what the tenant can 10 pay based upon the tenant's income? 11 A. Yes. 12 Q. Now, the resolution that was ultimately presented and 13 passed by a unanimous vote of the city council in September 14 designating Milio Management as the designated developer, 15 didn't that resolution provide that the seniors would have a 16 six-month exclusive window within which to apply for the 17 apartments? 18 A. My understanding was that she would have six months to 19 refer seniors to me. 20 Q. Are you saying it was your understanding that only seniors 21 who were specifically referred by Sandy Annabi could apply for 22 the housing? Is that what you are telling us? 23 A. Referred to, either by her office. 24 Q. Is that what you are telling us, it had to be referred by 25 her or her office? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1372 C2SUANN4 F. Milio - cross 1 A. Not specifically. Senior housing, six months. 2 MR. ARONWALD: Could I have the resolution that was 3 put up before. I don't remember the number. 4 (Discussion off the record among counsel) 5 Q. By the way, did you attend the meeting on September 26th of 6 2006? 7 A. No. 8 Q. But did you see this resolution before you took the stand 9 and testified here this afternoon? 10 A. Previously, yes. 11 Q. And when was the last time you saw this resolution? 12 A. I don't remember exactly when. A long time. I don't 13 remember specific reading through the whole resolution. I 14 don't know. 15 Q. Well, during the period of time that you met with the 16 prosecutors to prepare for your testimony here this afternoon, 17 among the documents that you were shown, was this resolution 18 one of those documents? 19 A. It was shown, yes. 20 Q. So that was within the last week? 21 A. Right. I didn't review it but, yes, it was shown to me. 22 Q. OK. Directing your attention to the first page of the 23 resolution, if we could have paragraph H blown up, please. The 24 bottom -- I'm sorry -- I think it is page 3. Let me show you. 25 (Discussion off the record among counsel) SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1373 C2SUANN4 F. Milio - cross 1 Q. Would you read that language aloud, please? 2 A. Sure: "H. For a period of six months following the 3 commencement of the designated developers' marketing program 4 for the redeveloped Longfellow property, the residential units 5 contained therein shall be marketed only to senior citizen 6 households, generally households consisting of single persons 7 55 years of age or older, or couples wherein one of the persons 8 is 55 years of age or older, provided that after the expiration 9 of such six-month initial marketing period, such marketing 10 requirement shall no longer be applicable with respect to any 11 of the units that, as of the date of such expiration, have not 12 been leased for senior citizen occupancy." 13 Q. Now, there is nothing in that language that says that only 14 those seniors referred by Sandy Annabi or someone from her 15 office could apply for that housing, does it? 16 A. That's correct. 17 THE COURT: Hang on a second, Mr. Aronwald. 18 Folks who are here for the sentencing, it is not going 19 to happen for at least half an hour. You might want to take 20 the children outside; they cannot be in here if they are going 21 to make noise. Thank you. I really appreciate it. 22 Mr. Aronwald, you may continue. 23 BY MR. ARONWALD: 24 Q. Mr. Milio, what I would like you to do, do you have the 25 exhibit actually before you? Is it still up there or was it SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1374 C2SUANN4 F. Milio - cross 1 taken down? 2 A. It is here. Paragraph H is here. 3 Q. No. I don't want you to look at the screen. 4 Could I have the exhibit itself? 5 Let me show you what is in evidence as Government 6 Exhibit 706. And I am going to ask you to please read to 7 yourself the pages 1 through 4. And I want you to tell me 8 whether you see anything in those four pages which comprise the 9 resolution that was approved by the city council, whether you 10 see anything in that resolution that says that only seniors 11 referred by Sandy Annabi or someone from her office were 12 eligible to apply for the housing. 13 (Pause) 14 MR. HALPERIN: Your Honor, the government is happy to 15 stipulate that it does not have the phrase Mr. Aronwald is 16 talking about. 17 MR. ARONWALD: I will accept the government's 18 stipulation, your Honor. 19 THE COURT: You can stop reading. 20 BY MR. ARONWALD: 21 Q. Now, there is nothing in the resolution that limits the 22 number of seniors that could apply for the apartments during 23 that six-month period, correct? 24 A. Yes. 25 Q. There is nothing in that agreement that says that Milio SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1375 C2SUANN4 F. Milio - cross 1 Management would determine the financial criteria, correct? 2 A. Yes. 3 Q. You testified before that Anthony Mangone, when you 4 questioned Anthony Mangone about that provision, he indicated 5 to you that you had nothing to worry about because you would be 6 able to determine whether the applicant was qualified or not. 7 Isn't that what you said? 8 A. That's correct. 9 Q. But there's nothing in the resolution that says what 10 Mr. Mangone told you, isn't that correct? 11 A. Yes. 12 Q. Yes, I'm correct? 13 A. Yes. 14 Q. So, in other words, during that six months, if in fact 15 there were 40 seniors who met the criteria that is set forth in 16 subparagraph H for an apartment, then they would get the 17 apartment so long as they met whatever financial criteria was 18 established by the City of Yonkers Municipal Housing Authority, 19 correct? 20 A. I am not sure if it is by the Municipal Housing Authority 21 of Yonkers. 22 Q. Do you remember telling Ms. Annabi either verbally or in 23 writing that the City of Yonkers Municipal Housing Authority 24 had been contacted by you in order to review their rental 25 procedures? Did you ever tell that to Ms. Annabi? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1376 C2SUANN4 F. Milio - cross 1 A. That who -- say that again. 2 Q. Did you at any time contact the City of Yonkers Municipal 3 Housing Authority, the MHA -- 4 A. Yes. 5 Q. -- to review their rental procedures? 6 A. I had. 7 Q. And did you tell Ms. Annabi that the procedure that would 8 be followed in determining whether or not an applicant would 9 get an apartment in the Longfellow Building would be similar to 10 the procedures used by the MHA? 11 A. I don't recall specifically. 12 Q. Do you recall that that's what you committed to doing? You 13 were going to use the same procedures that were in existence by 14 the City of Yonkers Municipal Housing Authority? 15 A. No, I don't recall that. 16 Q. And you don't recall sending Ms. Annabi and Debbie this 17 email on August 10, 2006 that was marked as Defense Exhibit 43 18 for identification, do you? 19 A. I don't recall. 20 Q. But we agree that there is nothing in the resolution that 21 gives Milio Management the authority to establish the financial 22 criteria for the eligibility of the seniors to apply, correct? 23 A. That's correct. 24 Q. Other than what is in paragraph H? 25 A. That's correct. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1377 C2SUANN4 F. Milio - cross 1 Q. So, therefore, it is true, is it not, that if enough 2 seniors apply during that exclusive six-month window, more than 3 40, that in effect if they met the financial criteria under the 4 letter of the resolution, they would get the 40 apartments, 5 correct? 6 A. If they met the financial criteria, yes, that's correct. 7 Q. In that event, then Ms. Annabi who had initially requested 8 all seniors, her goal or objective would have been satisfied, 9 correct? 10 A. It would have. 11 Q. And, by the way, after that six-month window of 12 exclusivity, then the application process would be open to 13 everyone including those seniors that had not applied during 14 that exclusive six-month window, correct? 15 A. Yes. 16 Q. In fact, with respect to how the seniors could apply or be 17 added to the list of applicants, didn't you tell Ms. Annabi, 18 either in writing or verbally, that these applicants could 19 apply by either calling Milio Management directly at 20 914-423-5022 or by being referred by Ms. Annabi's office or by 21 being referred by an agency such as City of Yonkers Office of 22 the Aging? Do you remember telling that to Ms. Annabi? 23 A. Not specifically, no. 24 Q. Does that sound familiar? 25 A. Not necessarily. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1378 C2SUANN4 F. Milio - cross 1 Q. Did you also represent to Ms. Annabi that once the 2 application was received, the applicant would be contacted and 3 would be shown the apartment? Did you tell her that? 4 A. No. I don't recall having any of these conversations with 5 Ms. Annabi. 6 Q. Just so I am clear in my question, I don't want you to be 7 misled. I don't want you to think that when I say 8 conversation, I am referring to a verbal conversation. 9 A. OK. 10 Q. I should be using the word "communication" instead, for 11 that I apologize. So by communication I mean either verbally 12 or writing, whether by letter, memorandum, email -- that's what 13 I am referring to -- 14 A. I don't recall. 15 Q. You do not recall ever communicating to Ms. Annabi that 16 once you received an application, you would contact the 17 applicant or Milio Management would contact the application and 18 make a showing of the apartment? You don't recall? 19 A. I don't recall that. 20 Q. Isn't that the procedure or process that would have been 21 followed in the event that the Longfellow project went forward? 22 A. Repeat the procedure again, please, that I would call -- go 23 ahead. 24 Q. You are in the business of, among other things, renting 25 apartments? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1379 C2SUANN4 F. Milio - cross 1 A. Yes. 2 Q. SO in the normal course of the business of Milio 3 Management, when an applicant submits an application for an 4 apartment or expresses an interest in an apartment, isn't one 5 of the steps that Milio Management takes is to take the 6 applicant and to show the applicant the available apartment? 7 A. Yes. 8 Q. With respect to Longfellow, was it your intention to do 9 anything other than what was normal in the custom and practice 10 that Milio Management followed in terms of showing applicants 11 the apartment? 12 A. No. 13 Q. Then was it also part and parcel of the practice of Milio 14 Management that if the applicant, after seeing the apartment, 15 was still interested in renting the apartment, the applicant 16 would be requested to do a number of things, correct? 17 A. OK. 18 Q. And that would be the same with respect to Longfellow, 19 correct? 20 A. Yes. 21 Q. One of the things that you would require would be the 22 filling out of a rental application, right? 23 A. Yes. 24 Q. And you would also charge an application fee, correct? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1380 C2SUANN4 F. Milio - cross 1 Q. Do you recall what the application fee was that was 2 normally charged by Milio Management as of August of 2006? 3 A. It is the same as it is still, $30. 4 Q. $30. 5 Would the applicant also be required to submit any 6 other information along with the application and the $30 7 application fee? 8 A. Same procedure back then as now; it would be picture ID, 9 pay stubs, proof of income, yes. 10 Q. And the $30 application fee was a non-refundable 11 application fee, right? 12 A. That's correct. 13 Q. It didn't make any difference whether it was paid cash or 14 check; it was non-refundable? 15 A. That's correct. 16 Q. Did you also require at that time that the applicant also 17 provide a credit report? 18 MR. HALPERIN: Objection. Relevance to this line. 19 THE COURT: The objection is sustained. 20 MR. ARONWALD: Your Honor, may I have a moment to 21 confer with Mr. Halperin. 22 THE COURT: Be my guest. I have been wondering about 23 this for sometime. 24 (Discussion off the record among counsel) 25 MR. HALPERIN: Your Honor, we will withdraw the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1381 C2SUANN4 F. Milio - cross 1 objection to this line of questions. 2 MR. ARONWALD: Thank you, Mr. Halperin. 3 BY MR. ARONWALD: 4 Q. So one of the other items that was regularly required of an 5 applicant was that the applicant submit a credit report, 6 correct? 7 A. They signed the rental application. I run the credit. 8 They don't submit it to me. 9 Q. So you would conduct a credit report; you would also 10 conduct a criminal background check? 11 A. Landlord-tenant check, I call it. 12 Q. Did you ever use the term "criminal report" as something 13 that you would either ask for or conduct? 14 A. I like to refer to it as a landlord-tenant check, not so 15 much criminal. I don't know in the past. I don't think I 16 never ever used -- I think I called it a landlord-tenant check. 17 Q. Also, you wanted the applicant to submit a reference form, 18 correct? 19 A. Well, that's part of the rental application. There is 20 something referred to as the landlord reference form. 21 Q. And the purpose of that was to allow you, Milio Management, 22 to conduct a character reference search by contacting current 23 and prior landlords of the applicant, correct? 24 A. Mainly -- no, my rental app really only shows the current 25 landlord, it requests. It only has the current landlord to SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1382 C2SUANN4 F. Milio - cross 1 fill out the information about that tenant. 2 Q. Was it your practice to also send emails to Alfred DelBello 3 in August of 2006 relating to the Longfellow project? 4 A. It would have been, yes. 5 Q. I would like to place before you now what's been marked as 6 Defendant's Exhibit 44 for identification. I am going to ask 7 you to please read that to yourself. 8 A. OK. 9 Q. Do you recognize that document? 10 A. Yes. 11 Q. Is that a document that you sent to Alfred DelBello? 12 A. It could have been, yes -- it was. 13 Q. That document that you spent to Mr. DelBello included the 14 document that I showed you before which has been marked 15 Defendant Exhibit 43; you were sending that to him for his 16 comments, correct? 17 A. Yes. 18 MR. ARONWALD: Your Honor, at this time I would move 19 this into evidence. 20 MR. HALPERIN: May I see it? 21 No objection. 22 THE COURT: Admitted. 23 (Defendant Exhibit 44 received in evidence) 24 MR. ARONWALD: Your Honor, this might be a convenient 25 break for today if you wish to. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1383 C2SUANN4 F. Milio - cross 1 THE COURT: It is not that I wish to, but I have to do 2 something else. 3 We will break for the day. We will be back tomorrow. 4 Don't discuss the case. 5 Mr. Siano, don't worry about anything. 6 MR. SIANO: Your Honor, I have an issue. 7 THE COURT: I am letting the jurors go, Mr. Siano. 8 MR. SIANO: Thank you. 9 THE COURT: I am not doing anything else. 10 11 (Continued on next page) 12 13 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1384 C2SUANN4 1 (Jury not present) 2 THE COURT: I believe, Mr. Milio, that Mr. Siano wants 3 me to admonish you not to talk to Mr. Carbone or Mr. Halperin 4 or any representative of the government tonight because you are 5 on cross-examination. They are not allowed to talk to you and 6 you don't talk to them. 7 Does that make you happy, Mr. Siano? 8 It was not necessary to do that in front of the jury. 9 MR. SIANO: I just wanted to make sure that no one 10 else left the room. I am satisfied with your Honor's 11 admonition. 12 THE COURT: It is good to know that I learned 13 something after doing this for all these years. 14 You may step down. 15 (Witness excused) 16 THE COURT: Now, before anyone else leaves, here is 17 what I understand is going to happen. I understand that we 18 have a procedure for dealing with the tape issue. The 19 government should certainly make sure that that tape is in the 20 courtroom. 21 MR. CARBONE: We will, Judge. 22 THE COURT: And that we will have a way if the witness 23 needs to hear it to it refresh his recollection of letting him 24 listen to it with earphones or whatever, cued up to the 25 appropriate part. I don't think that you need to listen to the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1385 C2SUANN4 1 entire conversation. 2 Mr. Siano. 3 MR. SIANO: He does need to listen to the whole thing. 4 THE COURT: He doesn't? 5 MR. SIANO: He absolutely does. 6 THE COURT: And we were going to sit here while he 7 does it? 8 How long is it? 9 MR. SIANO: It is about 20 minutes. 10 THE COURT: With the jury in the box? 11 MR. SIANO: I don't mind if he does it on his own. In 12 Fact, I am at ease with the agents putting the headphones on 13 him and letting him listen. Since it is going to be a refresh 14 your recollection thing, I want him to listen to the whole 15 thing. It is a conversation in March of '08. 16 THE COURT: That is fine. Now I have just told him 17 that he can't have any contact with the agents until he gets 18 back on the stand because Mr. Aronwald was in the middle of 19 cross, and you specifically jumped up in front of the jury and 20 begged me to admonish him. So now the agent can't let him 21 listen to the tape until we have the jury in the box and the 22 witness on the stand, and then the jury will sit there for 20 23 minutes while he listens to the tape. 24 I think that's a bad way to do it. I think you think 25 it is a bad way to do it. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1386 C2SUANN4 1 MR. HALPERIN: Judge, can I have a moment to talk to 2 Mr. Siano? 3 THE COURT: Sure. 4 (Discussion off the record among counsel) 5 MR. HALPERIN: Judge, we have spoken with Mr. Siano. 6 He is apparently not comfortable with us playing the tape, but 7 he is comfortable with the agent playing the tape. So we will 8 have one of the agents play the tape. 9 THE COURT: Bring the witness back in for just a 10 moment. 11 MR. HALPERIN: Judge, you want the witness back in? 12 THE COURT: So I can tell him that the agent is going 13 to talk to him. 14 (Witness Franco Milio present) 15 THE COURT: There's an exception to what I just told 16 you because to save time the parties want to do this. One of 17 the agents tomorrow morning -- I would imagine it is going to 18 happen if you can get here by 9 o'clock. 19 THE WITNESS: OK. 20 THE COURT: One of the agents has my authorization to 21 play a tape for you that the lawyers for the defendants want 22 you to listen to before they continuing questioning. OK? 23 THE WITNESS: OK. 24 THE COURT: So you are going to listen to that tape. 25 The agents are not going to talk to you about anything else and SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1387 C2SUANN4 1 you are not going to talk to the agents about anything else. 2 You are just going to listen to the tape. OK? 3 THE WITNESS: Sure. 4 THE COURT: Thank you so much. 5 (Witness Franco Milio excused) 6 (Proceedings adjourned until February 29, 2012) 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1388 1 INDEX OF EXAMINATION 2 Examination of: Page 3 BRUCE BENDER 4 Cross By Mr. Siano ...... 1193 5 Redirect By Mr. Carbone . . . 1195 6 Recross By Mr. Aronwald . . . 1201 7 Recross By Mr. Siano . . . . . 1207 8 Redirect Q...... 1209 9 JOHN SWAGERTY 10 Direct By Mr. Halperin . . . . 1210 11 Cross By Mr. Aronwald . . . . 1230 12 Cross By Mr. Siano ...... 1237 13 FRANCO MILIO 14 Direct By Mr. Halperin . . . . 1246 15 Cross By Mr. Siano ...... 1314 16 Cross By Mr. Aronwald . . . . 1355 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1389 1 GOVERNMENT EXHIBITS 2 Exhibit No. Received 3 389A ...... 1217 4 735 and 735A through 735D ...... 1259 5 708 ...... 1267 6 710 ...... 1270 7 711 ...... 1288 8 700 ...... 1306 9 706 ...... 1312 10 DEFENDANT EXHIBITS 11 Exhibit No. Received 12 3520R ...... 1315 13 44 ...... 1382 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300

1390 C2TUANN1 Trial 1 UNITED STATES DISTRICT COURT 1 SOUTHERN DISTRICT OF NEW YORK 2 ------x 2 3 UNITED STATES OF AMERICA, 3 4 v. 10 CR 007 (CM) 4 5 SANDY ANNABI and ZEHY JEREIS, 5 6 Defendant. 6 7 ------x 7 8 New York, N.Y. 8 February 29, 2012 9 9:55 a.m. 9 10 10 11 11 Before: 12 12 HON. COLLEEN MCMAHON, 13 13 District Judge 14 14 15 APPEARANCES 15 16 PREET BHARARA 16 United States Attorney for the 17 Southern District of New York 17 JASON P.W. HALPERIN 18 PERRY A. CARBONE 18 Assistant United States Attorneys 19 19 WILLIAM I. ARONWALD 20 Attorney for Defendant ANNABI 20 21 ANTHONY J. SIANO 21 JEANNIE GALLEGO 22 Attorneys for Defendant JEREIS 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1391 C2TUANN1 Trial 1 (In open court; jury not present) 2 THE DEPUTY CLERK: Case on trial continues. The 3 government and the defendants are present -- almost present. 4 MR. SIANO: Mr. Aronwald is in the potty. 5 THE DEPUTY CLERK: The jurors are in the jury room. 6 THE COURT: Have we had our tape-listening-to this 7 morning? 8 MR. HALPERIN: Yes. It happened yesterday afternoon 9 with the agents, Judge. 10 THE COURT: Excellent. 11 What little surprises are in store for me today? 12 MR. SIANO: Judge, I understand, although Mr. Aronwald 13 is not here he is aware of this, that Mr. Halperin is prepared 14 to continue the sidebar conversation and to tell the Court that 15 there is no other agreement, there is no oral agreement 16 regarding the Milio family. I just wanted to wait for Mr. 17 Aronwald to hear -- 18 THE COURT: Mr. Aronwald is now here. 19 Good morning, Mr. Halperin. Is the government 20 prepared to assure me what I am positive it assured Judge 21 Briccetti at the plea? 22 MR. HALPERIN: We are, your Honor. We have no side 23 agreements from the cooperation agreement with the two Milios. 24 I will represent to the Court that it is not currently the 25 government's intention to prosecute any other family members. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1392 C2TUANN1 Trial 1 And the Milio attorneys have been advised that all other family 2 members who are owners or part owners of the business do need 3 to file amended, accurate tax returns, but there are no side 4 agreements in terms of prosecution. 5 MR. SIANO: Thank you, Judge. 6 THE COURT: Surely that can't shock you, Mr. Siano. 7 MR. SIANO: Very little does. 8 THE COURT: Good morning, Mr. Aronwald. 9 MR. ARONWALD: Good morning, your Honor. 10 I just want to follow up on what you advised us 11 yesterday concerning two of the jurors. I wanted to see if 12 there were any new developments. 13 THE COURT: Are there new developments? 14 THE DEPUTY CLERK: Yes. Juror Number 3 will be paid. 15 It has been taken care of. 16 THE COURT: Mr. O'Neil is an extraordinary and 17 invaluable resource to this Court. 18 MR. ARONWALD: Agreed. 19 THE COURT: Have we found out from Juror Number 12 the 20 board on which he sits and with whom he sits, the vendor 21 person. 22 THE DEPUTY CLERK: On that I am not such a great 23 resource. I will get that. 24 Are you ready for the jurors? 25 THE COURT: Yes. Would you like to get the witness. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1393 C2TUANN1 Trial 1 Would everyone like to get started? 2 Are we a go? 3 MR. HALPERIN: Yes. 4 MR. ARONWALD: Yes. 5 6 (Continued on next page) 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1394 C2TUANN1 Trial 1 (Jury present) 2 THE COURT: Good morning. 3 Happy Leap Day. 4 Mr. Milio is back with us. 5 You are still under oath, sir. 6 Mr. Aronwald. 7 FRANCO MILIO, resumed. 8 called as a witness by the government, 9 having been previously duly sworn, testified as follows: 10 CROSS-EXAMINATION (Continued) 11 BY MR. ARONWALD: 12 Q. Good morning, Mr. Milio. 13 A. Good morning. 14 Q. Mr. Milio, when you were on direct examination yesterday or 15 the day before, you were asked some questions concerning the 16 fact that when you were contacted by the FBI or were served 17 with the subpoena, Mr. Mangone referred you to Michael 18 Santangelo, correct? 19 A. Yes. 20 Q. With respect to the meeting that you had with Michael 21 Santangelo, was your father Antonio with you at that time? 22 A. No. 23 Q. Were you aware at the time of any relationship that existed 24 between Michael Santangelo and Anthony Mangone? 25 A. I believe they were partners -- associates or partners. We SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1395 C2TUANN1 F. Milio - cross 1 discussed that yesterday. 2 Q. Do you recall that you, in the course of speaking to 3 Mr. Michael Santangelo, you mentioned to him the fact that you 4 had given $40,000 to Anthony Mangone? 5 A. I believe I mentioned 30,000. 6 Q. Now, when you said that to Mr. Santangelo, he excused 7 himself from the meeting, didn't he? 8 A. He ended the meeting, or it seemed like to have ended 9 naturally and that was that. I don't recall him getting up and 10 excusing himself immediately. 11 Q. Was that the last time that you spoke to Michael Santangelo 12 concerning that matter? 13 A. Yes. 14 Q. And that was followed by your discussion with Anthony 15 Mangone in the basement of the building, correct? 16 A. Not the same day, yes. 17 Q. Within a day or two, was it? 18 A. That's correct. 19 Q. That's when Anthony Mangone recommended that you go to 20 Lawrence Diagiansante, correct? 21 A. Yes. 22 Q. Just so that we are clear, at that time you asked 23 Mr. Mangone whether or not you should mention the $30,000 to 24 Mr. Diagiansante, correct? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1396 C2TUANN1 F. Milio - cross 1 Q. And what did he say to you? 2 A. Not to. 3 Q. He said absolutely not, correct? 4 A. Yes. 5 Q. Now, you testified yesterday that you hired Anthony Mangone 6 to represent you, correct? 7 A. Yes. 8 Q. You were already represented by Mr. DelBello, correct? 9 A. Yes, I was, with the Walgreens project, I was. 10 Q. With the Walgreens? 11 A. Yes. 12 Q. At that time the company had been represented by another 13 attorney by the name of Frank Cocozza, correct? 14 A. That's correct. 15 Q. And Mr. Cocozza basically was your general counsel; he was 16 the attorney that handled all of the matters relating to the 17 company? 18 A. Yes. 19 Q. And he retired? 20 A. Yes. 21 Q. And so the company needed to hire another lawyer to replace 22 him in terms of the other matters that Milio Management was 23 involved in, correct? 24 A. Yes. 25 Q. When you initially met with Mr. Mangone, you met with him SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1397 C2TUANN1 F. Milio - cross 1 for the purpose of discussing with him the possibility of his 2 succeeding Mr. Cocozza as the company's general counsel? 3 A. Yes. 4 Q. At the time when you had hired Mr. DelBello, you hired 5 Mr. DelBello for the specific purpose of representing Milio 6 Management with respect to the Walgreen Longfellow project, 7 correct? 8 A. Yes. 9 Q. When you decided to hire Mr. Mangone, there was a formal 10 retainer agreement that was prepared, correct? 11 A. Yes. 12 Q. Let me show you what's been marked as Defendant Exhibit 45. 13 MR. ARONWALD: If I may approach, your Honor? 14 THE COURT: You may. 15 MR. ARONWALD: Thank you. 16 Q. And I would ask that you take a look at that and tell me 17 whether you recognize it? 18 A. Yes. 19 Q. Is that the retainer agreement that you signed on behalf of 20 Milio Management for the services of Mr. Mangone? 21 A. Yes. 22 MR. ARONWALD: Your Honor, I move Defense Exhibit 45 23 in evidence. 24 THE COURT: 45 is offered. 25 MR. HALPERIN: No objection. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1398 C2TUANN1 F. Milio - cross 1 THE COURT: Admitted. 2 (Defendant Exhibit 45 received in evidence). 3 MR. ARONWALD: If I can ask Mr. Turk to just put that 4 up on the screen. 5 BY MR. ARONWALD: 6 Q. So were you retaining Mr. Mangone or were you retaining the 7 firm of Santangelo Randazzo and Mangone to represent Milio 8 Management? 9 A. Regarding the Walgreens Longfellow project? 10 Q. When you entered into this retainer agreement, were you 11 retaining Mr. Mangone only for purposes of the Walgreen 12 Longfellow project or to handle other matters on behalf of 13 Milio Management? 14 A. He was handling other matters as well. 15 Q. My question to you is, when you signed this agreement, were 16 you retaining the services of Mr. Mangone or were you retaining 17 the services of the law firm Santangelo Randazzo and 18 Mr. Mangone? 19 A. In my opinion, Mr. Mangone. 20 Q. Did you read the agreement before you signed it? 21 A. I'm sure I had. 22 Q. Directing your attention to the first paragraph. 23 MR. ARONWALD: If we could that blown up. 24 Q. Were you aware at the time you signed it that you were 25 retaining the firm to represent Milio Management in connection SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1399 C2TUANN1 F. Milio - cross 1 with the development and reconstruction of the former 2 Longfellow and School 6 in the city of Yonkers? 3 A. Yes, however, there is more to it. 4 Q. OK, please. 5 A. This was signed later. Originally, Mr. DelBello did not 6 want to have Anthony Mangone involved, so I hadn't signed it. 7 This had been signed later on. 8 Q. The agreement is dated April 26 of 2006. Are you saying 9 you didn't sign it on that date? 10 A. That's correct. I believe it was signed much later. There 11 is a notation in the upper righthand corner. 12 Q. The notation in the upper righthand corner reads 7-22-06, 13 underlined, never paid, and then the word "executed" is crossed 14 out and it says, "this was stopped"? 15 A. Right. It was signed later on after the money was given 16 and everything else, sometime after. It was not signed in 17 April. 18 Q. Do you know of any reason why the document was not redated 19 to reflect the date that you actually signed it? 20 A. I don't. 21 Q. In any event, at the time that you signed this agreement, 22 it was your impression that Santangelo Randazzo and Mangone was 23 an existing law firm, correct? 24 A. Yes. 25 Q. The handwriting in the righthand corner that you referred SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1400 C2TUANN1 F. Milio - cross 1 to that I just read, is that your handwriting? 2 A. Yes. 3 Q. Can you tell us what that refers to? 4 A. That document specifically? 5 Q. I am going to hand it back to you. 6 MR. ARONWALD: And if we can put it back up on the 7 screen so that we can focus in on the handwritten portion. 8 Q. Do you see it in front of you? 9 A. Yes. 10 Q. Can you just explain what those handwritten notations mean 11 or refer to? 12 A. Those notations, I wrote that and, essentially, I never 13 proceeded with that specific agreement because Anthony wasn't, 14 according to Mr. Al DelBello, he didn't want his involvement so 15 I never had sent it. 16 Q. Had never sent what? 17 A. This agreement. I had never really executed it even though 18 it was signed. 19 Q. So 7/22/06, that is the date, correct? 20 A. That's correct. That's when I wrote it. 21 Q. So you wrote these notations on July 22 of '06? 22 A. That's correct. 23 MR. ARONWALD: You can take that down. 24 Thank you. 25 Q. You also had a retainer agreement with Mr. DelBello, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1401 C2TUANN1 F. Milio - cross 1 correct? 2 A. Yes. 3 Q. Showing you what's been marked as Defense Exhibit 46 for 4 identification, let me show you what's been marked as Defendant 5 Exhibit 46 for identification and ask you to take a look at it 6 and tell me whether you recognize that? 7 A. Yes. 8 Q. And what is it? 9 A. The retainer agreement for Ashburton Avenue School 6 10 Longfellow from Al DelBello's office. 11 Q. And it is signed by you, correct? 12 A. Antonio Giuseppe Milio. 13 Q. You recognize the handwriting? 14 A. I do. 15 MR. ARONWALD: Your Honor, I move Defense Exhibit 46. 16 MR. HALPERIN: Objection. Relevance. 17 THE COURT: Do you want to give it to me. 18 I will let it in. 19 (Defendant Exhibit 46 received in evidence) 20 BY MR. ARONWALD: 21 Q. Now, you testified that you had been referred to 22 Mr. DelBello by Edward Sheeran? 23 A. At a meeting, yes. 24 Q. Do you recall how soon before the date of the retainer 25 agreement, June 17, 2005, was it that you met with Mr. Sheeran SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1402 C2TUANN1 F. Milio - cross 1 and he referred you to Mr. DelBello? 2 A. I am not really sure. I can't say. Shortly before. 3 Can I see that again? 4 Q. Sure. 5 A. Thank you. 6 Q. You had used Mr. DelBello before, hadn't you? 7 A. No, not him, his firm. 8 Q. Do you recall being interviewed on March 12, May 19, and 9 July 17 of 2008 by Assistant United States Attorney Carbone and 10 agents from the FBI? 11 A. More or less, yes. 12 Q. Well, do you recall telling them that you were familiar 13 with DelBello since Franco -- meaning you -- since you used him 14 in the past on other matters for Milio Management? Do you 15 recall telling that to the agents and to Mr. Carbone? 16 A. Like I said earlier, we used his firm several times. 17 That's why we decided to use his firm. I don't recall 18 specifically saying that, but if I did, I would consider it 19 accurate because of the fact that I used his firm. But you 20 asked me specifically if I had used him before. I don't recall 21 ever using Al DelBello. That was the first time I met him. 22 Q. Let me show you what is 3520B, page 4. Directing your 23 attention to the highlighted portion that I am pointing to, I 24 just ask you to read that to yourself. 25 MR. HALPERIN: Mr. Aronwald, what page is that? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1403 C2TUANN1 F. Milio - cross 1 MR. ARONWALD: Page 4, first paragraph. 2 A. OK. 3 Q. You read that to yourself? 4 A. I did. 5 Q. Does that refresh your recollection that you told them that 6 you were familiar with DelBello since you had used him in the 7 past on other matters for Milio Management? 8 A. Not necessarily. I have used -- I don't think that is 9 accurate. 10 Q. OK. Now, just so we are clear, you never had any 11 discussions with Sandy Annabi concerning the payment of any 12 money, correct? 13 A. Yes. 14 Q. Yes, that's correct. 15 And it is also correct that you never had any 16 discussions with Zehy Jereis concerning the payment of any 17 money, correct? 18 A. Yes. 19 Q. The only person you had any discussions with concerning the 20 payment of money with respect to anything involving Longfellow 21 and the votes of the city council was Anthony Mangone, correct? 22 A. Yes. 23 Q. You testified that money was delivered, $40,000 was 24 delivered to Anthony Mangone by your father, correct? 25 A. I testified $30,000. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1404 C2TUANN1 F. Milio - cross 1 Q. 30,000. 2 Now, the fact is that you have no idea what Anthony 3 Mangone did with that money once you gave it to him, do you? 4 A. No, I do not. 5 Q. For all you know, he may have used the money for gambling 6 or some other avocation of his, correct? 7 A. I suppose. 8 Q. You just don't know, right? 9 A. That's correct. I don't know. 10 Q. You never saw Anthony Mangone give any of that money or any 11 money to either Zehy Jereis or Sandy Annabi, isn't that true? 12 A. That's correct. 13 Q. Now, you also testified concerning the first meeting you 14 had with Anthony Mangone -- I think you said it was at Reno's 15 restaurant? 16 A. Yes. 17 Q. That's located in Westchester? 18 A. Yes. 19 Q. What part of Westchester? 20 A. Yonkers. 21 Q. Who was present at that meeting? 22 A. Myself, my cousin Dominick, my cousin Romeo, Joe 23 Guarniero -- another man -- Joe Guarniero and Anthony Mangone 24 and later on, Nick Spano. 25 Q. You didn't expect to see Senator Spano at that meeting? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1405 C2TUANN1 F. Milio - cross 1 A. That's correct. 2 Q. Did you ever seek or attempt to utilize Senator Spano to 3 reach out to Sandy Annabi to persuade her to vote to designate 4 you the developer? 5 A. I believe at one point I may have made a phone call but 6 nothing -- just to talk and nothing came of it. 7 Q. But the purpose, the reason that you made that phone call 8 was because you wanted to solicit Senator Spano's support in 9 helping you get Sandy Annabi to vote to designate you the 10 developer, isn't that the reason why you made that call? 11 A. That's correct, yes. 12 Q. And that was before the meeting with Anthony Mangone at 13 Reno's restaurant, correct? 14 A. I don't remember. 15 Q. Let me show you what has been marked 3520T, and it would be 16 the first page. 17 You testified yesterday that 3520 is one page of a 18 series of contemporaneous diary entries that you made as the 19 projects went along, correct? 20 A. Yes. 21 Q. So directing your attention to the portion that I am 22 pointing to, would you just read that to yourself? 23 A. Yes. 24 Q. Does that refresh your recollection that you reached out to 25 Senator Spano before you ever met with Anthony Mangone? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1406 C2TUANN1 F. Milio - cross 1 A. Yes. 2 Q. And you reached out to Senator Spano on August 3 of 2005, 3 correct? 4 A. Yes. That's what my note states. 5 Q. By the way, the original proposal, we have heard the number 6 40 units as 40 apartment units that were to be let out if the 7 Longfellow project had proceeded, correct? 8 A. Yes. 9 Q. But the initial proposal was for twice that number of 10 apartments wasn't it? 11 A. Not necessarily. I believe there was some discussion with 12 the administration about adding higher floors to the building 13 but that was very early on shot down. 14 Q. No. I am referring to early on. At the earliest stages 15 wasn't the figure of 80 apartments or 80 units mentioned? 16 A. I remember at a meeting my father talking about wanting to 17 add extra floors with the administration, but that's as far as 18 it got as I recall. 19 Q. So the meeting you had at Reno's restaurant with Mr. 20 Mangone, what is your best recollection as to what month that 21 meeting took place in? 22 A. April. 23 Q. Do you know what date it was in April? 24 A. I believe it was April 14 of 2006, around Easter time. 25 Q. And then when was the next time that you spoke to SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1407 C2TUANN1 F. Milio - cross 1 Mr. Mangone? 2 A. I am not sure. I think we started a dialog after that. 3 Q. But you said that it was at that meeting that, in the 4 course of the meeting you started discussing with him a number 5 of different projects that Milio was interested in, right? 6 A. Yes. 7 Q. One of those projects was Longfellow? 8 A. Yes. 9 Q. And you mentioned to him that there was a problem with 10 Longfellow, is that what you said? 11 A. Yes, I had mentioned the stall, that they were stalling. 12 Q. As best you can, can you tell us what it is that you recall 13 saying to Mr. Mangone about the Longfellow project? 14 A. In substance, it would have been something to the effect, 15 the city came to me. It is a good project, a lot of people 16 support it. I just don't get why Sandy is giving me the 17 runaround. She is being difficult. Stuff to that effect. 18 Q. Well, when you told him that Sandy was giving you the 19 runaround, this April meeting, was that before or after the 20 city council meeting that the jury saw yesterday where she 21 mentioned the one dollar? 22 A. That was before. That meeting was before. 23 Q. The meeting with Mangone was before? 24 A. No, I'm sorry. The council meeting that we saw yesterday, 25 the video, that was before the meeting. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1408 C2TUANN1 F. Milio - cross 1 Q. And you were present throughout that city council meeting? 2 A. I was. 3 Q. This was an important project to you? 4 A. Yes. 5 Q. And so you were listening very carefully to what Ms. Annabi 6 said -- 7 A. Yes. 8 Q. -- as to the reasons why she was not going to support the 9 project? 10 A. Yes. 11 Q. You heard her say to you that it would be unfair to 12 designate you the developer and have you spend a substantial 13 sum of money putting together plans and everything have them 14 come back and say no, we are not going to approve that. You 15 heard her say this? 16 A. She did, yes. 17 Q. Was that correct, in other words, you described what the 18 designated developer means, so if you were designated the 19 developer, you would have one year to do what? 20 A. To seek approvals for the development of the sites. 21 Q. OK. Well, to seek approvals, what would you have to do? 22 Would that include getting together plans, environmental impact 23 studies, architectural drawings, things like that? Is that 24 what you would need to do to get these approvals? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1409 C2TUANN1 F. Milio - cross 1 Q. And those aren't for free, are they? 2 A. No. 3 Q. And they are quite expensive, aren't they? 4 A. Yes. 5 Q. So when Ms. Annabi said it would cost you a substantial 6 amount of money had you been designated the developer, she was 7 saying something that was entirely correct and accurate, wasn't 8 she? 9 A. Yes. 10 Q. Indeed, you would agree that it would have been unfair to 11 designate you the developer if she had the intention all the 12 time of not voting for this project, correct? 13 A. Yes. 14 Q. So you understood that one of the reasons why she was 15 "giving you the runaround" was because she had told you that it 16 would be unfair to designate you the developer, have you spend 17 a lot of money and then come back with a proposal that they 18 would shoot down, right? 19 A. Yes. 20 Q. Did you think that her saying that was giving you the 21 runaround? 22 A. No. 23 Q. By the way, you did say yesterday that it was a very 24 crowded meeting? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1410 C2TUANN1 F. Milio - cross 1 Q. When you say crowded, were you referring to the number of 2 seniors that had been bused in to attend the meeting from her 3 strict? 4 A. Yes. There were seniors as well as non-seniors present. 5 Q. Do you have any approximation as to the number of people 6 that came in from her district? 7 A. I don't know exact. It was crowded. I don't know the 8 number. 9 Q. It was not a small room, was it? 10 A. No. 11 Q. Not as big as this courtroom but certainly -- 12 A. It might be the size of this courtroom. 13 Q. I will take that. Thank you. 14 You heard her say that the reason why she was not in 15 favor of designating you the developer was because she was not 16 in favor of market rate housing and she wanted affordable rate 17 housing, correct? 18 A. She said, I believe, senior housing specifically. 19 Q. You don't remember her saying anything about market rate 20 housing? 21 A. I believe she said she didn't want market rate housing; she 22 wanted senior housing only. 23 Q. Let me ask you this question. If it is not market rate 24 housing, wouldn't it have to be affordable housing? 25 A. Not according to what was asking. She was asking for SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1411 C2TUANN1 F. Milio - cross 1 senior housing only. 2 Q. We discussed yesterday the difference between market rate 3 housing and affordable housing. Does senior housing have a 4 special classification? 5 A. Basically, it is affordable housing, but only for seniors. 6 I believe like we see day to day, senior complexes. I was 7 under the impression she specifically wanted one of those 8 complexes for seniors only. 9 Q. So you heard her say that, correct? 10 A. Yes. 11 Q. You heard her also tell you that she would vote for this 12 project if it was anywhere else in her district. She said that 13 too, didn't she? 14 A. She mentioned to seek other areas in District 2 or 15 something to that effect, yes. 16 Q. You know that she was the council member representing only 17 District 2 in the city of Yonkers? 18 A. Yes. 19 Q. So when I asked you before that you heard her say that she 20 would vote for this project if it was anywhere else in her 21 district, she was referring to District 2, correct? 22 A. Yes. 23 Q. So did you think when she said she wanted housing for 24 seniors only, did you think that that was giving you a 25 runaround? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1412 C2TUANN1 F. Milio - cross 1 A. At the time, no. 2 Q. When she said that she would vote for this project if it 3 was anywhere else in the district, did you think that that was 4 giving you the runaround? 5 A. I guess not. 6 Q. When she said to you, if you want to provide housing for 7 the seniors and you come back to us, we are ready to talk -- 8 did you hear her say that at that meeting? 9 A. She did. 10 Q. That wasn't giving you the runaround, was it? 11 A. Prior to that she had told me to speak to somebody else, 12 but that's why I felt she was giving me the runaround. 13 Q. Well, let's talk about that. You told the jury that when 14 you first raised the subject with Ms. Annabi, she said to you, 15 look, go speak to Steve Kubicek -- he was a former city council 16 member -- and if he says it is OK, it is OK with me? That's 17 what you testified to? 18 A. That's correct, yes. 19 Q. And then you spoke to Steve Kubicek, correct? 20 A. Yes. 21 Q. And now we jump forward to the conversation that you heard 22 when Ms. Annabi and Mr. Kubicek were coming out of the elevator 23 at City Hall and you overheard a conversation or something 24 Ms. Annabi said to Mr. Kubicek, right? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1413 C2TUANN1 F. Milio - cross 1 Q. What you heard her say, if I recall your testimony 2 correctly and if I recall it incorrectly please tell me -- 3 A. OK. 4 Q. -- I recall your testimony to be you heard her say, I am 5 not for this project. I am not voting for it. I'm the council 6 member. You are not. And she walked away? 7 A. Yes. 8 Q. And then you described Mr. Kubicek as standing there with 9 his mouth open? 10 A. Yes. 11 Q. That was just before the city council meeting, wasn't it? 12 A. Yes. 13 Q. The city council meeting that was played for the jury 14 yesterday, correct? 15 A. I am not specifically sure if it was that one or another 16 one, but it was for a meeting of some sort. I am not sure if 17 it was exactly the June 14 meeting. 18 Q. But that meeting that we heard yesterday, that the jury saw 19 yesterday, that meeting took place after the conversation that 20 you had with Mr. Kubicek and after the conversation that you 21 overheard between Ms. Annabi and Mr. Kubicek, correct? 22 A. Yes. 23 Q. Isn't it true that at that meeting, the city council 24 meeting, she explained that she had learned a lot more 25 information than she knew originally, for example -- I am SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1414 C2TUANN1 F. Milio - cross 1 asking too many questions. 2 Didn't she say -- thank you. 3 Didn't she say that she had learned a lot of 4 information that influenced her position? Didn't she say that? 5 A. She did. 6 Q. Among the things she referred to was the fact that there 7 was opposition by the seniors in her community to the project. 8 You heard her say that, right? 9 A. Yes. 10 Q. So you felt that she was giving you the runaround, from 11 what you just told us, because she referred you to Mr. Kubicek, 12 you went to Mr. Kubicek and when you got finished with 13 Mr. Kubicek, Sandy wouldn't give you the designated developer? 14 A. Essentially. 15 Q. So you had the conversation with Mr. Mangone. 16 MR. HALPERIN: Timing. 17 MR. ARONWALD: We are going now to the first 18 conversation. 19 Q. Between the time that you first met with Mr. Mangone, there 20 had been a number of real estate committee meetings? 21 A. Repeat the question. 22 Q. Before your initial meeting with Mr. Mangone in April of 23 2006, there had been a number of Yonkers city real estate 24 committee meeting? 25 A. There had been, yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1415 C2TUANN1 F. Milio - cross 1 Q. And some of those meetings related to the Longfellow issue, 2 correct? 3 A. Yes. 4 Q. Did you attend all of those real estate committee meetings? 5 A. I am not sure if I attended all of them. I can't recall. 6 Q. Did you attend some of them? 7 A. I am sure I did. 8 Q. At those meetings that you did attend, Milio Management was 9 represented by Al DelBello? 10 A. Yes. 11 Q. By the way, you also hired an architect by the name of 12 Bruno Pietrosanti, correct? 13 A. Yes. 14 Q. One of the things Mr. Pietrosanti was tasked with was 15 preparing some drawing and other things that would be needed to 16 move this designated developer process along, correct? 17 A. Yes. 18 Q. It took a while for Mr. Pietrosanti to get these plans and 19 drawings done, correct? 20 A. I suppose so. 21 Q. In fact, in the diary or the contemporaneous notes, didn't 22 you make mention of the fact that Pietrosanti had still not 23 done the drawings? 24 A. I can't recall, but it doesn't sound unreasonable. 25 Q. So there was a lot going on. There were real estate SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1416 C2TUANN1 F. Milio - cross 1 committee meetings that you attended, Mr. DelBello attended, 2 and Mr. Pietrosanti also attended some of these meetings? 3 A. That's correct. 4 Q. There were also some public meetings where members of the 5 public from the second district were invited to attend to 6 listen to the proposal and to discuss the pros and cons of the 7 Longfellow project, right? 8 A. Yes. 9 Q. And you attended those? 10 A. That one I did. 11 Q. And Mr. DelBello appeared also, correct? 12 A. Yes. 13 Q. And was Mr. Pietrosanti also there? 14 A. Yes. 15 Q. Was your father? 16 A. Yes. 17 Q. Was any other member of the Milio family there? 18 A. I don't believe so. 19 Q. Anthony Mangone was not there? 20 A. No. 21 Q. Anthony Mangone never attended any of the real estate 22 committee meetings on behalf of Milio Management with respect 23 to Longfellow, did he? 24 A. Up until that point, no. 25 Q. In fact, up to the time of the September 25, 2006 passage SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1417 C2TUANN1 F. Milio - cross 1 of the resolution designating Milio Management as the 2 designated developer, Anthony Mangone didn't appear at any real 3 estate committee meetings on behalf of Milio Management, did 4 he? 5 MR. HALPERIN: Objection to the date. 6 THE COURT: Objection to the what? 7 Q. September 26, 2006, up to that time, Mr. Mangone didn't 8 appear at any of the city council meetings in his capacity as 9 attorney for Milio Management, did he? 10 A. That's correct. 11 Q. Nor did he appear in his capacity as the attorney for Milio 12 Management in the any of the real estate committee meetings up 13 to September 26 of '06? 14 A. That's correct. 15 Q. But Al DelBello did? 16 A. He did. 17 Q. In fact, Al DelBello is the person that got this proposal 18 or resolution passed, isn't that true? 19 A. Yes. 20 Q. Now, so you have this first meeting with Mr. Mangone and 21 then there are a series of discussions. And then there comes a 22 time in June of '06 when he calls and tells you that you need 23 to pay $30,000 to get this project approved, right? 24 A. Yes. 25 Q. Do you recall any discussion that you had with him before SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1418 C2TUANN1 F. Milio - cross 1 he called to tell you that, where you made a specific inquiry 2 as to what the holdup was? 3 A. Before that meeting? Before that phone call that he called 4 again? 5 Q. Yes. 6 A. Specifically, like I said, before there were lots of phone 7 conversations for different things going on, so not right off 8 the top of my head right now. 9 Q. Do you recall having a conversation with Mr. Mangone before 10 he called to tell you that you would have to pay $30,000 to get 11 this project approved? 12 Do you recall a conversation where you said to 13 Mr. Mangone, "What the fuck does it take to get this woman on 14 board? Does she need something?" 15 Do you recall asking Mr. Mangone that before he called 16 you to tell you that you had to pay $30,000? 17 A. I would like to see that. I don't recall off the top of my 18 head. 19 Q. Let me show you what's been marked as 3520D. 20 (Discussion off the record between counsel) 21 Q. Let me show you what is marked 3520D, page 6, directing 22 your attention to the bottom of the highlighted portion that I 23 am referring to. 24 A. What is this? 25 Q. I'm just asking you -- I can't tell you what it is. All I SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1419 C2TUANN1 F. Milio - cross 1 can say is would you look at it? 2 THE COURT: He gets to ask the questions. 3 THE WITNESS: Sorry. I don't recall. I'm sorry. 4 THE COURT: He doesn't know what that is. 5 THE WITNESS: I don't recall saying what -- 6 THE COURT: No, no. The question is, do you know what 7 that is? 8 MR. ARONWALD: Can I tell him what it is without 9 asking what is in there. 10 BY MR. ARONWALD: 11 Q. These are notes of an interview -- 12 MR. HALPERIN: Objection. 13 THE COURT: The objection is sustained. 14 Thank you. 15 You may go back to the podium, Mr. Aronwald. 16 MR. ARONWALD: Thank you. 17 May I just have a moment? 18 THE COURT: Of course. 19 BY MR. ARONWALD: 20 Q. Mr. Milio, just to be clear, you are not denying that you 21 said that to the agents; you are saying you don't recall if you 22 said that to the agents, is that correct? 23 A. I don't remember saying it. 24 Q. Do you deny saying it? 25 A. I don't recall -- yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1420 C2TUANN1 F. Milio - cross 1 Q. Do you recall a conversation where you had a discussion 2 with Mr. Mangone where you asked him a question and before that 3 $30,000 conversation where he said to you, it is usually the 4 attorney's job to handle these matters? Do you recall that? 5 MR. HALPERIN: Objection. Hearsay. 6 THE COURT: The objection is sustained. 7 Q. Now, you testified yesterday on direct and on cross about 8 the tax evasion scheme that you pled guilty to before Judge 9 Briccetti, correct? 10 A. Yes. 11 Q. And the accusatory instrument or the information to which 12 you pled -- strike that. 13 When you appeared before Judge Briccetti, you 14 basically indicated that you had evaded taxes in the amount of 15 $2,172,554, correct? 16 A. Yes. 17 Q. Now, that is the amount of the taxes that were not 18 reflected on the corporate and personal tax returns that you 19 filed, correct? 20 A. I believe so. 21 Q. But what was the amount of the unreported income that 22 created the $2,172,554? What was the amount of the unreported 23 income? 24 A. I don't know. 25 Q. Well, it was certainly far in excess of the $2,172,554, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1421 C2TUANN1 F. Milio - cross 1 correct? 2 A. I really don't know how to answer your question. 3 Q. You mean there was just so much cash that you can't even 4 tell us how much of that case you didn't report on the tax 5 returns? 6 A. I can't answer the question. Repeat the question. 7 Q. What is funny about the question? 8 A. I don't understand your question. You asked me if that 9 number represents what exactly. 10 Q. When you appeared before Judge Briccetti, one of the things 11 he asked you was whether or not you had read the information 12 and the plea agreement, correct? 13 A. That is correct. 14 Q. And he asked you whether you understood it before you 15 signed the plea agreement, correct? 16 A. Yes. 17 Q. He also asked you to explain in your own words what it is 18 that you did that made you guilty of this tax evasion scheme, 19 correct? 20 A. Yes. 21 Q. Now, you admitted when you took your plea that you had 22 failed to report substantial rental income from the Milio 23 Management properties leading to an evasion of corporate and 24 personal income taxes due and owing of approximately 25 $2,172,554. Do you recall saying that under oath when you SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1422 C2TUANN1 F. Milio - cross 1 appeared before Judge Briccetti? 2 A. Yes. 3 Q. What I am asking you is, the $2,172,554 represents the 4 amount of taxes that you evaded, correct? 5 A. OK. Yes. 6 Q. I am asking you how much unreported income was there with 7 respect to the corporate and personal income tax returns that 8 led to a tax due and owing figure of $2,172,554? 9 MR. HALPERIN: Objection. Asked and answered. 10 THE COURT: Overruled. 11 A. I don't know. 12 Q. My question to you is, was there so much cash that you have 13 no idea how much cash there was that was not reported? 14 A. It wasn't only just cash. Your question before was about 15 how much rental income was not reported and I don't know. 16 And as far as the question about was there so much 17 cash, that's not the reason -- I don't know how to explain 18 that -- 19 Q. Let me ask the question differently. 20 A. -- or answer it. 21 Q. Regardless of the source, because I think you indicated 22 that there was other cash that came into the business that was 23 not just rental income, correct? 24 A. I don't believe I did. 25 Q. Was there other cash that came into the business aside from SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1423 C2TUANN1 F. Milio - cross 1 rental income? 2 A. No. 3 Q. Well, the only cash that came into the business was rental 4 income, then the only cash that was unreported was the rental 5 income, correct? 6 A. That's correct. 7 Q. So how much cash rental income was there that you did not 8 report? 9 A. I don't know how much cash there was. I can't answer the 10 question. It was -- we would receive checks, cash. I can't 11 answer the question, the exact number or figure. 12 Q. In the course of your plea negotiations with the government 13 and before you appeared before Judge Briccetti didn't anybody 14 from the government show you a schedule indicating the amount 15 of unreported income? 16 A. Me, I had attorneys handling it. I don't recall. I may 17 have seen them, but I didn't study them or analyze them. I had 18 attorneys handing this matter. 19 MR. ARONWALD: Your Honor, may I just approach 20 government counsel for a moment? I just want to ask your 21 permission, your Honor. 22 THE COURT: Sure. 23 MR. ARONWALD: Your Honor, may we have a brief 24 sidebar? 25 I apologize, I really do. It's important. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1424 C2TUANN1 F. Milio - cross 1 THE COURT: It is always important. 2 MR. ARONWALD: Sometimes more important than others, 3 but I appreciate your Honor's patience. 4 5 (Continued on next page) 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1425 C2TUANN1 F. Milio - cross 1 (At the sidebar) 2 THE COURT: I appreciate that I am not cued in to all 3 the subtleties, but haven't you made the point that this 4 business is so awash in cash that this man has no idea of how 5 much money he has cheated the government out of all of these 6 years? 7 MR. ARONWALD: Your Honor is correct except those 8 figures are available because they are on a schedule. I asked 9 Mr. Halperin and Mr. Carbone to produce the schedules so that I 10 can show them to the witness. 11 THE COURT: Get real here. No accurate figures could 12 possibly be on the schedules. 13 MR. ARONWALD: But, Judge, they prepared schedules -- 14 MR. SIANO: He said he saw -- 15 MR. ARONWALD: They won't show them to us because Mr. 16 Halperin said that battle has been fought and lost. It was 17 never presented to you in that context. 18 THE COURT: I don't know what that means, that battle 19 was fought and lost. 20 MR. SIANO: The witness said, I think I saw schedules. 21 If there are schedules he is entitled to ask the witness what 22 he saw. 23 MR. ARONWALD: The jury is entitled to know that this 24 figure of the $2 million doesn't represent the total amount of 25 income. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1426 C2TUANN1 F. Milio - cross 1 MR. HALPERIN: He has already said that he doesn't 2 know. As the judge said -- 3 MR. ARONWALD: But the figures -- 4 MR. HALPERIN: Can I finish? 5 The judge ruled before the trial that you are not 6 entitled -- 7 THE COURT: Excuse me. This is what you can ask. 8 Mr. Aronwald, ask him: Is it not the case that you 9 realized substantially more than $2 million in income and you 10 know that? See what he says. 11 MR. ARONWALD: I am going to do that. 12 THE COURT: Just do that. 13 MR. ARONWALD: If he says no, he doesn't know -- 14 THE COURT: If he says no, then we will revisit the 15 subject. 16 MR. ARONWALD: Thank you, Judge. 17 18 (Continued on next page) 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1427 C2TUANN1 F. Milio - cross 1 (In open court) 2 MR. ARONWALD: Thank you, your Honor. 3 BY MR. ARONWALD: 4 Q. Mr. Milio, isn't it true that the amount of unreported cash 5 income was substantially more than $2,172,554? 6 A. Yes. 7 Q. Thank you. 8 MR. ARONWALD: Just one moment, your Honor. 9 Thank you. I have no further questions, your Honor. 10 THE COURT: Mr. Siano. 11 MR. SIANO: Thank you. 12 CROSS-EXAMINATION 13 BY MR. SIANO: 14 Q. Mr. Milio, did you have occasion between yesterday's 15 appearance and today's to listen to a conversation that you 16 consensually recorded on or about March 19 of, I believe, the 17 year was 2008? 18 A. Yes. 19 Q. And you were in a car with Mr. Mangone? 20 A. Yes. 21 Q. Do you recall in that conversation, sir, asking Mr. Mangone 22 about, did part of the money you gave him go to Kubicek? 23 A. I did. 24 Q. You did say that? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1428 C2TUANN1 F. Milio - cross 1 Q. In that conversation, sir, you also had occasion to discuss 2 with him, in that same conversation, the progress of other real 3 estate matters that he was still representing you on, isn't 4 that right? 5 A. Yes. 6 Q. So in that conversation, you were discussing the 7 disposition of what you understood to be a bribe payment and 8 you were also asking him about the other legal work he was 9 doing for you? 10 A. It was in the course of the conversation, that's correct. 11 Q. Would it be fair to say that Mr. Mangone was therefore 12 still representing Milio Management at that time? 13 A. Yes. 14 Q. You answered some questions about the fact that you had 15 reached out to Senator Spano in August 2005. Do you remember 16 those questions? 17 A. Yes, I do. 18 Q. But there came a time later on when you actually had 19 meetings with Senator Spano, isn't that right? 20 A. Yes. 21 Q. You and Senator Spano and Mr. Mangone? 22 A. Yes. 23 Q. That wasn't the only state senator that Mr. Mangone 24 introduced you to, was it? 25 A. That's correct. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1429 C2TUANN1 F. Milio - cross 1 Q. He introduced you to another state senator? 2 MR. HALPERIN: Objection. Relevance. 3 MR. SIANO: Oh, Judge, this is public record. 4 THE COURT: The objection is overruled for the moment. 5 Let me see where this is going. 6 Q. He introduced you to Senator Libous, didn't he? 7 A. Yes. 8 MR. HALPERIN: Objection. Relevance. 9 Q. Were you surprised when Mr. Libous was introduced to you by 10 Mr. Mangone? 11 MR. HALPERIN: Objection. Relevance. 12 THE COURT: The objection is sustained. I really 13 don't see where this is going. 14 Q. You discussed a real estate project with Mr. Mangone and 15 Senator Libous, isn't that right? 16 MR. HALPERIN: Objection. Relevance. 17 THE COURT: The objection is sustained. 18 Q. Did you have a senior housing project going on somewhere 19 upstate? 20 A. No. 21 Q. Did you have a senior housing project going on at the time 22 you met with Senator Libous? 23 A. No. 24 Q. Now, you said that it was Pat Guarniero that introduced you 25 to Mr. Mangone at this Reno's meeting? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1430 C2TUANN1 F. Milio - cross 1 MR. HALPERIN: Objection, your Honor. Beyond the 2 scope of -- 3 THE COURT: Objection sustained. 4 MR. SIANO: Judge, I didn't complete my cross. 5 MR. HALPERIN: Beyond the scope of the purpose the 6 Court allowed the recross which was the tape. 7 THE COURT: I will let him go on. 8 BY MR. SIANO: 9 Q. It was Mr. Guarniero, isn't that right? 10 A. What name did you say before? 11 Q. The gentleman that recommended Mr. Mangone to you was 12 Mr. Guarniero, wasn't it? Joe Guarniero? 13 A. Yes. I don't know if he recommended him, but he was at the 14 meeting. 15 Q. And Mr. Guarniero was a building inspector in Yonkers? 16 A. Yes. Housing. 17 MR. SIANO: Judge, let me show the witness what has 18 now been marked Defendant's Exhibit 47 for identification. 19 Q. Mr. Milio, I am asking you to look at what's been marked 20 for identification as Defendant Exhibit 47 and I ask you, do 21 you recognize the document? 22 A. Yes. 23 Q. In fact, what do you recognize the document to be? 24 A. What I referred to as task notes. 25 Q. This is one piece of those task notes? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1431 C2TUANN1 F. Milio - cross 1 A. Yes. 2 Q. If you direct your attention for purposes of time to the 3 page with the Bates serial number 58444 and look at the top, 4 does that in fact reflect a meeting in April of 2006? 5 A. April when? 6 Q. Is it 2006? 7 A. Yes. 8 Q. And in fact that is a meeting that you had with Senator 9 Libous? 10 MR. HALPERIN: Objection, relevance. 11 THE COURT: The objection is sustained. 12 Q. Did you meet with Senator Libous on Longfellow? 13 A. We met to discuss the possibility -- 14 THE COURT: The question is, did you meet with him on 15 Longfellow, yes or no? 16 THE WITNESS: Yes. 17 THE COURT: Then you can ask about that. 18 Q. In fact, Senator Libous was introduced to you by Anthony 19 Mangone? 20 A. Yes. 21 Q. And you continued to deal with Anthony Mangone and Senator 22 Libous after July of 2006 into the following years, isn't that 23 right? 24 A. Repeat the question. 25 Q. Did you continue to deal with Senator Libous after July of SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1432 C2TUANN1 F. Milio - cross 1 2006? 2 A. No. 3 MR. SIANO: No further questions, Judge. 4 REDIRECT EXAMINATION 5 BY MR. HALPERIN: 6 Q. Good morning, Mr. Milio. 7 A. Good morning. 8 Q. Counsel just asked if you heard what Sandy Annabi said at 9 the June 14, 2005 city council meeting which was played for the 10 jury yesterday. Do you recall that? 11 A. I do. 12 Q. And do you remember Councilwoman Annabi saying you were 13 getting the project for one dollar? 14 A. I do. 15 Q. Was that accurate? 16 A. No. 17 Q. Why not? 18 A. As previously stated, the negotiation was, it was going to 19 be a land swap between my properties on Ashburton and North 20 Broadway and the two city school buildings, and in exchange I 21 was to give a right-of-way, develop both properties create 22 market rate housing at the Hollows at Longfellow, a Walgreens 23 retail store on the North Broadway-Ashburton site. It was 24 never a dollar. 25 Q. In or about June 2005 at the time of that city council SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1433 C2TUANN1 F. Milio - redirect 1 meeting, roughly how much money had Milio Management invested 2 in the Longfellow project? 3 A. 1 .2, 1 .5 million, in that ballpark -- close to 1 and a 4 half million dollars. 5 6 (Continued on next page) 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1434 C2tQann2 F. Milio - Redirect 1 BY MR. HALPERIN: 2 Q. Counsel asked you about how you had said that Sandy Annabi 3 was giving you the run-around when you met with Mangone in 4 April 2006 at Reno's restaurant, do you recall that? 5 A. Yes. 6 Q. Why do you say as of 2006 Councilwoman Annabi was giving 7 you the run-around on Longfellow? 8 A. She -- like I had stated earlier, she had told me back the 9 year before to speak to Steve Kubicek. She told me to get his 10 support, and she would support it. She didn't. And then I 11 hired Al DelBello. I would say about eight months had passed 12 and we were still what I felt going nowhere with the project, 13 and there was an overall resistance to the project from her, 14 and that's why I told him that, you know, she was giving me the 15 run-around essentially at that meeting in April. 16 Q. Counsel asked you a series of questions about your tax 17 offenses this morning. Do you recall that? 18 A. I do. 19 Q. Where did you get the cash that you used to pay employees 20 at Milio Management? 21 A. I got them from the buildings from the rental income. 22 Q. Did you take as a deduction on your corporate returns the 23 cash for the off-the-books payroll? 24 A. No. 25 Q. Counsel asked you yesterday about your off-the-books SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1435 C2tQann2 F. Milio - Redirect 1 employees. Do you recall that? 2 A. I do. 3 Q. How many employees at Milio Management are currently off 4 the books? 5 A. None. 6 Q. What, if anything, is Milio Management doing to obtain 7 legal work papers for these employees? 8 A. We are sponsoring them through the immigration department 9 of labor and other means as the attorney sees fit. 10 Q. Do you recall that counsel asked you yesterday about your 11 notes that you took at the time, your contemporaneous diary 12 notes, about certain things that happened with the Longfellow 13 project? 14 A. Yes. 15 Q. Counsel asked about how you did not write in your notes -- 16 you did not write in your notes yourself about the one meeting 17 you had with Zehy Jereis at Anthony Mangone's office. Do you 18 recall that? 19 A. I believe so. 20 Q. Did you write every detail in your notes? 21 A. Not every detail, no. 22 Q. How inclusive were your notes? 23 A. I feel maybe earlier on when I had started the project I 24 was more, and then as time went on, there were just so many 25 moving parts to this project and so many things that I was SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1436 C2tQann2 F. Milio - Redirect 1 doing on my day-to-day operations that I didn't always get to 2 them. 3 Q. As you sit here today, how certain are you that in late 4 April 2006 you had a meeting with Zehy Jereis at Anthony 5 Mangone's office relating to the Longfellow project? 6 A. A hundred percent. 7 Q. What do you recall Mr. Jereis saying at the end of that 8 meeting? 9 A. "Anthony, let me know what you want me to do." Essentially 10 that was the outcome of the meeting. 11 Q. Do you recall that counsel asked you about how in the grand 12 jury you said that you thought that your father had given the 13 cash to Mangone one to two days before the June 14, 2006 real 14 estate committee meeting? 15 A. I do. 16 Q. And counsel asked about how your recollection is that it 17 happened in, you said, late June or early July? 18 A. That's correct, late June, early July. 19 Q. What was the basis for that change in your recollection? 20 A. Based on the -- my meeting with Sandy at the town hall -- 21 at the town hall meeting, it was around that time, that's how I 22 remember it. 23 Q. The town hall meeting on June 21? 24 A. That's correct, with the mayor present, in that 25 neighborhood in the Hollows. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1437 C2tQann2 F. Milio - Redirect 1 Q. Counsel asked you about whether you had talked -- about 2 your discussions with Al DelBello relating to the Longfellow 3 project. Do you recall that? 4 A. Yes. 5 Q. Did you ever talk to Mr. DelBello about the cash payment 6 that your father had given to Mr. Mangone? 7 A. No. 8 Q. Why not? 9 A. I knew it was the wrong thing to say, and he was adamantly 10 against working with Anthony Mangone. 11 Q. Counsel asked you about the recording you made of Mangone 12 in a car after you began cooperating with the FBI in 13 March 2008. Do you recall that? 14 A. I do. 15 Q. Was that recording made under the supervision of the FBI 16 agents? 17 A. It was. 18 Q. Why did you mention Steve Kubicek's name to Anthony Mangone 19 in the car that day? 20 A. It was basically something I made up. I was -- as a 21 cooperating -- since I was cooperating with the FBI and trying 22 to get Anthony to confess or talk about the money, I created 23 essentially a ruse or a distraction by mentioning his name and 24 pretty much ran with that in trying to -- hoping that he would 25 say something about it. That's pretty much it. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1438 C2tQann2 F. Milio - Redirect 1 Q. Did you or your father or anyone else at Milio Management 2 ever make a cash payment to Steve Kubicek? 3 A. No, never. 4 Q. Counsel asked you about how you once said to the FBI that 5 since there was a lot of cash lying around Milio Management, 6 you could steal money from your father and he'd never even 7 know. Do you recall those questions? 8 A. I do. 9 Q. Sir, have you ever stolen money from your father? 10 A. No, never. Never would. Never will. 11 Q. Counsel asked a lot of questions about your engaging in tax 12 evasion. Do you recall that? 13 A. Yes. 14 Q. And obviously you did engage in tax evasion, correct? 15 A. Yes. 16 Q. Prior to the time the FBI agents contacted you in this 17 case, had you been contacted by any IRS agents? 18 A. No. 19 Q. During your interviews with the government, what, if 20 anything, did you bring to the government's attention about 21 your taxes? 22 A. I disclosed that it was something I was -- we were doing 23 wrong in the family business. 24 Q. Mr. Turk, can we please display Government Exhibit 706 in 25 evidence. Can we go to page 4, maximize paragraph H, please. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1439 C2tQann2 F. Milio - Redirect 1 Sir, do you recall being asked about this paragraph on 2 cross yesterday? 3 A. I do. 4 Q. Please read the portion of the paragraph that is not 5 underlined. 6 A. For a period of six months following the commencement of 7 the designated developer's marketing program for the 8 redeveloped Longfellow property, the residential units 9 contained therein shall be marketed only to senior citizen 10 households (generally households consisting of single persons 11 55 years of age or older, or couples wherein one of the persons 12 is 55 years of age or older). 13 Q. Stop there. Now, please read the portion that is 14 underlined. 15 A. Provided, that after the expiration of such six-month 16 initial marketing period, such marketing requirement shall no 17 longer be applicable -- applicable, sorry -- with respect to 18 any units that, as of the date of such expiration, have not 19 been leased for senior citizen occupancy. 20 Q. Under this provision, sir, what would happen after six 21 months? 22 A. It would be available to rent to whomever I -- any -- open 23 to the public, anybody. 24 Q. In your experience, how many months does it usually take to 25 fill 40 apartments? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1440 C2tQann2 F. Milio - Redirect 1 A. It all depends on -- on the demand. It would take -- it 2 would take -- it would take a few months. It would take -- it 3 would take awhile, a few months, I would say. 4 Q. When you marketed the units for seniors, would most of the 5 units be market rate housing or non-market rate housing? 6 A. I'm sorry, repeat that. 7 Q. Under the Longfellow resolution that was approved 8 September 26, 2006, when you marketed the units for seniors, 9 would most of the units be market rate housing or non-market 10 rate housing? 11 A. Market. Market. 12 Q. What percent of the units under the approved resolution 13 would be offered at the market rate? 14 A. 80 percent. 15 Q. Do you recall counsel asking you about the three conditions 16 Mangone set out in his email from July 10, 2006 that 17 Councilwoman Annabi had wanted? 18 A. I do. 19 Q. How significant a change did you view these three 20 conditions to be? 21 A. Not -- not significant at all. 22 Q. Why do you say that? 23 A. They were very open-ended and there -- the 20 percent, the 24 20 percent issue, it was nothing. And like I said earlier, if 25 an apartment is renting for a thousand dollars, it could be SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1441 C2tQann2 F. Milio - Redirect 1 rented for 975, even 995, it didn't matter, so that wasn't 2 really an issue. 3 The seniors, this part here with the six months, it 4 ends after six months and even though they still could be 5 market housing, they weren't some kind of a subsidized program. 6 And the other issue with the appraisal which is really 7 what I was concerned about. When I spoke to Anthony, he told 8 me not to worry because Zehy is an appraiser. 9 Q. Do you recall counsel asking you about the $30,000 in cash 10 that your father gave to Mangone and how you don't know what 11 Mangone did with the money. Do you recall that? 12 A. That is correct, I don't. 13 Q. You don't know what Mangone did with the money, correct? 14 A. Yes. 15 Q. Mr. Milio, what was the status of the Longfellow project 16 before your father gave the $30,000 cash payment to 17 Mr. Mangone? 18 A. Essentially dead or stalled. I would say severely stalled. 19 Q. You testified that your father brought Mangone the money in 20 late June or early July 2006? 21 A. That is correct. 22 Q. Let's show Government Exhibit 700, Mr. Turk, please. 23 Maximize the top half, please. 24 What's the date of this email, Mr. Milio? 25 A. July 10, 2006. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1442 C2tQann2 F. Milio - Redirect 1 Q. How soon after your father brought Mangone the money did 2 you receive this email which is dated July 10, 2006 roughly? 3 A. Roughly, I would say, give or take within a week, week's 4 time to ten days. 5 Q. Let me direct your attention to paragraph with the number 2 6 in front. Please read the second sentence. 7 A. Those results will not affect the approval which will 8 happen tomorrow. 9 Q. Based on this email you received from Mr. Mangone on 10 July 10, what was your understanding about whether a deal had 11 been reached on Longfellow? 12 A. It had been done. 13 Q. A deal with which counsel member? 14 A. Sandy Annabi. 15 Q. What month was the Longfellow project actually approved? 16 A. September of 2006. 17 MR. HALPERIN: Nothing further. 18 THE COURT: Anything else? 19 MR. SIANO: Judge, we need a moment. 20 THE COURT: Take a moment. 21 (Pause) 22 RECROSS EXAMINATION 23 BY MR. ARONWALD: 24 Q. Mr. Milio, up until -- strike that. 25 When you first appeared before the city council to be SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1443 C2tQann2 F. Milio - Recross 1 designated the developer at Longfellow, there was nothing in 2 the resolution that indicated that the seniors would have any 3 six-month exclusivity in terms of applying for housing in 4 Longfellow, whether it be market or affordable rate housing, 5 isn't that the truth? 6 A. I believe so, yes. 7 Q. And the fact of the matter is what -- didn't you testify a 8 half hour ago that seniors basically are a separate category 9 from market and affordable rate housing? Do you remember 10 saying that? 11 A. A senior-based housing project is a separate, yes. 12 Q. But the point is that the resolution that was finally 13 passed in September of 2006, in that resolution, Milio 14 Management agreed and incorporated within the resolution that 15 the seniors would have exclusive rights to apply for apartments 16 within Longfellow, correct? 17 A. I believe for six months, correct. 18 Q. For six months? 19 A. Yes. 20 Q. You just testified in answer to Mr. Halperin's question 21 that it could take a few months to basically rent out 40 units, 22 correct? 23 A. Give or take. I honestly -- let's say yes. 24 Q. And a few months certainly includes within the six-month 25 period, correct? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1444 C2tQann2 F. Milio - Recross 1 A. Yes. 2 Q. You testified yesterday that if enough seniors had applied 3 for housing for apartments in Longfellow within that six-month 4 window and met the financial criteria, then those -- all of 5 those units would have been rented to those seniors, correct? 6 A. Yes. 7 Q. That was not anywhere in the original resolution that was 8 voted down by the city council, correct? 9 A. I believe so. That's correct. 10 Q. Now, with respect to the appraisal, there was an appraisal 11 done on the property, correct? 12 A. There were appraisals done. 13 Q. Who did those appraisals? 14 A. I believe the city did them and some Al DelBello had gotten 15 done. 16 Q. Zehy Jereis didn't do any of those appraisals, did he? 17 A. No, those were not. 18 Q. And Anthony Mangone never told you that Zehy Jereis was 19 going to do the appraisal, did he? 20 A. He did tell me that. 21 Q. He did, you're sure? 22 A. He did. Yes, he did. 23 Q. But he didn't do it, did he? 24 A. Well, this was supposed to be done after the project, after 25 I got that email, they were going to be done afterwards, and SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1445 C2tQann2 F. Milio - Recross 1 Zehy was going to do them according to Anthony. 2 Q. Isn't it true that the appraisals needed to be done before 3 the resolution would be passed, not after? 4 A. I was under the impression it was going to be done after, 5 that was my concern. So if that's the fact, then they were 6 never done because the -- the resolution was passed in 7 September, and no appraisal was ever done if that's the case. 8 My understanding it was going to happen later on and not to 9 worry because Zehy was going to do them. 10 Q. OK. You testified again on redirect examination that Al 11 DelBello refused to work with Anthony Mangone, and that that 12 was one of the reasons why you didn't mention the money that 13 Anthony Mangone had mentioned to you to Mr. DelBello, correct? 14 A. Yes. 15 Q. You knew Mr. DelBello's background, correct? 16 A. Not entirely. I found out more later on. Back then not 17 entirely. 18 Q. Well, if not entirely, were you aware at the time you hired 19 Mr. DelBello that he had held public office in the State of New 20 York? 21 A. No. 22 Q. You were not aware of that? 23 A. Not at the time. 24 Q. OK. Now, the task notes that you have referred to 25 throughout your testimony, certainly one of the things that you SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1446 C2tQann2 F. Milio - Recross 1 -- one of the reasons you kept these task notes was to jot down 2 the things that you felt were significant and important, 3 correct? 4 A. Essentially. 5 Q. I am going to show you 3520-T, and I am going to ask you to 6 go through these notes and see whether or not you made any 7 entry whatsoever that Al DelBello told you he would not work 8 with Anthony Mangone? 9 A. June 15, 2006. 10 Q. Does it say he would not work with Anthony Mangone? Did 11 those words appear? 12 A. Those exact words, no. 13 Q. Show me the portion, please. Would it be fair to say that 14 Mr. DelBello was somewhat surprised and upset when he heard 15 that you had been speaking to Anthony Mangone concerning having 16 Mr. Mangone represent you in connection with Longfellow, 17 correct? 18 A. Yes. 19 MR. ARONWALD: No further questions. Thank you. 20 RECROSS EXAMINATION 21 BY MR. SIANO: 22 Q. Mr. Milio, you told the FBI in 2008 that you believed your 23 father made the payment to Mr. Mangone on or about June 14, 24 2006? 25 A. I believe I had said that, yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1447 C2tQann2 F. Milio - Recross 1 Q. Right. And then you also stated here in court that you 2 might have been off a week to June 20 with regards to the 3 payment to Anthony Mangone? 4 A. Plus or minus, yes. 5 Q. Plus or minus a week off the 14th? 6 A. Might have been maybe ten days later. It was after the 7 date that we state -- said before, after the 20th, around that 8 time. 9 Q. And you know that from your dealings with your father, 10 isn't that right, because you didn't make the payment to 11 Anthony? 12 A. That's correct. 13 Q. The only thing you know about any payment to anybody else, 14 however, is from information Mr. Mangone gave you, isn't that 15 right? 16 A. Repeat that. 17 Q. Well, after your father gave the money to Mr. Mangone, you 18 never saw the money passed to anybody else, did you? 19 A. That is correct. 20 Q. And the only person whose word you have for what happened 21 to it is Anthony Mangone? 22 A. Yes. 23 MR. SIANO: No further questions, your Honor. 24 MR. HALPERIN: Nothing further, Judge. 25 THE COURT: You may step down Mr. Milio. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1448 C2tQann2 F. Milio - Recross 1 THE WITNESS: Thank you. 2 (Witness excused) 3 MR. CARBONE: The government calls Debbie Kayal. 4 MR. HALPERIN: Judge, does the Court want to take a 5 two minute morning break or no? 6 THE COURT: I didn't want to, no. 7 MR. CARBONE: Judge, the witness will be here 8 momentarily. 9 THE COURT: All right. Take a break. Don't discuss 10 the break. Keep an open mind. 11 MR. CARBONE: She is here, Judge. 12 THE COURT: Yes, but I just excused the jury. Make 13 SURE she is on the witness stand in eight minutes. 14 (Recess) 15 (Continued on next page) 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1449 C2tQann2 F. Milio - Recross 1 (In open court; jury not present) 2 THE COURT: Case on trial continued. Counsel and 3 defendants are present. Jurors are not present. 4 Mr. O'Neill has the necessary information that he will 5 provide to you folks so that the necessary inquiry can be made. 6 MR. HALPERIN: We will make the inquiry. 7 THE DEPUTY CLERK: Jurors? 8 THE COURT: Yes. 9 (Continued on next page) 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1450 C2tQann2 F. Milio - Recross 1 (Jury present). 2 THE COURT: Call your next witness, please. 3 MR. CARBONE: The government calls Debbie Kayal. 4 DEBBIE KAYAL, 5 called as a witness by the Government, 6 having been duly sworn, testified as follows: 7 DIRECT EXAMINATION 8 BY MR. CARBONE: 9 THE DEPUTY CLERK: Tell us your full name. 10 THE WITNESS: Debbie Kayal. 11 THE DEPUTY CLERK: Spell that. 12 THE WITNESS: D-E-B-B-I-E; K-A-Y-A-L. 13 THE COURT: OK. You may inquire. 14 MR. CARBONE: Thank you, your Honor. 15 BY MR. CARBONE: 16 Q. Good morning, Ms. Kayal. 17 A. Good morning. 18 Q. Where do you live? 19 A. 60 Odin Court, Yorktown Heights, New York. 20 Q. How far did you go in school? 21 A. Bachelor's degree. 22 Q. Are you employed? 23 A. Not currently. 24 Q. Have you ever been employed by the city of Yonkers? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1451 C2tQann2 Kayal - Direct 1 Q. What positions have you held? 2 A. Administrative assistant, legislative aide. 3 Q. Had you ever worked for Sandy Annabi? 4 A. Yes. 5 Q. During what time period? 6 A. 2006 -- March of 2006, and I think it was only up until 7 2007, but I can't remember the month. 8 Q. Was it in the beginning of the year or toward the end? 9 A. In the beginning -- middle. 10 Q. Was it more than a year? 11 A. Working with Sandy? I believe it was more than 12 months. 12 Q. What was your title when you worked for her? 13 A. I believe it was legislative aide, maybe one or two. 14 Q. What were your duties? 15 A. Administrative work, liaison between the community and -- 16 and I guess the office, setting up meetings, calendar items. 17 Q. Are you friends with Ms. Annabi? 18 A. We've gotten to be friends, yes. 19 Q. Is it fair to say that you've socialized? 20 A. Occasionally. 21 Q. Has she been to your house before -- 22 A. Yes. 23 Q. -- to your pool? And have you been to her house? 24 A. Yes. 25 Q. Have you been out for drinks? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1452 C2tQann2 Kayal - Direct 1 A. Yes. 2 Q. Have you traveled together? 3 A. Yes, business; not pleasure. 4 Q. What is your sister's name? 5 A. Donna Mangone. 6 Q. Are you related -- how are you related to Anthony Mangone? 7 A. He's my brother-in-law. 8 Q. Is it fair to say that during the period of time you worked 9 for Ms. Annabi you saw her at least once a week on average? 10 A. During work or personally? 11 Q. During work. 12 A. Well, yeah, we seen each other when I was at work. 13 Q. And approximately how frequently was that, on average? 14 A. Tuesdays, forever. Mondays, Wednesdays, I would say maybe 15 two, three times a week, but Tuesdays for sure. 16 Q. Did you speak with her frequently during that time period? 17 A. Yes. 18 Q. And did you email her regularly? 19 A. Yes. 20 Q. As you said before, one of your duties was to maintain her 21 calendar? 22 A. Correct. 23 Q. Mr. Turk, could you please broadcast Government Exhibit 386 24 in evidence? 25 Ms. Kayal, can you read the subject line of this SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1453 C2tQann2 Kayal - Direct 1 calendar entry? 2 A. Meeting, Bruce Bender. 3 Q. What is the location? 4 A. Starbucks, 2458 Central Park Avenue, Yonkers. 5 Q. The start and end time? 6 A. 3:00 p.m. to 3:30 p.m. 7 Q. And now would you -- and the organizer here is? 8 A. Organizer says Sandy Annabi. 9 Q. What is the date of the meeting? 10 A. July 11, 2006. 11 Q. Can you read the entry dated July 10, 2006? 12 A. July 10? 13 Q. Yes, at the bottom? 14 A. Debbie/BB called Z this morning. He was going to call/meet 15 about it this afternoon. As per SA, 3:00 p.m. is good. Please 16 confirm location. As per Debbie/BB's office, that's the only 17 one Bruce knows. As per Debbie at Bruce Bender's office. The 18 Best Buy complex. 19 Bruce Bender's assistant's name is Debbie as well. 20 Q. Would that be Debbie Venesia? 21 A. I believe so. It's not me. 22 Q. And BB, is that Bruce Bender? 23 A. I could only assume. 24 Q. When it says as per SA, is that Sandy Annabi? 25 A. Yeah, that would be my guess. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1454 C2tQann2 Kayal - Direct 1 Q. Debbie BB called Z this morning. Is that Zehy Jereis? 2 A. Z for Zehy. 3 Q. Can you read the entry dated July 11 of 2006? 4 A. SA will be 15 minutes late. Left message at 12:21 p.m. 5 Q. Mr. Turk, would you please broadcast Government Exhibit 770 6 in evidence. 7 Ms. Kayal, could you please beginning with the top, 8 read the subject line. 9 A. Special council meeting. 10 Q. And the location? 11 A. Saunders High School. 12 Q. What is the date? 13 A. August 15, 2006. 14 Q. It says meeting status, meeting organizer. And who is 15 required attendee on this calendar event? 16 A. Required attendee is Debbie Kayal. 17 Q. Ms. Kayal, do you recall that Ms. Annabi was away visiting 18 Jordan in the summer of 2006? 19 A. Yes. 20 Q. Now, let's maximize the email on the bottom of the calendar 21 entry, and starting first from the from line. 22 Debbie.Kayal, is that your email address? 23 A. Yes. 24 Q. Who were you sending this email to? 25 A. Sandy Annabi. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1455 C2tQann2 Kayal - Direct 1 Q. Is that Sandy Annabi's city of Yonkers account? 2 A. No. 3 Q. Is that her personal account? 4 A. Yes. 5 Q. What is the date of the email that you sent? 6 A. July 20, 2006. 7 Q. Approximately what time? 8 A. 6:37 p.m. 9 Q. The subject is special council meeting, August 15? 10 A. Yes. 11 Q. Now, Mr. Turk, would you please maximize the first 12 paragraph of the email. 13 It says: Joan had just advised of a special council 14 meeting that will be held on August 15 at 7:00 p.m. at Saunders 15 High School. Who is the Joan referred to there? 16 A. I believe that would be Joan Deierlein, the city clerk. 17 Q. Was Joan Deierlein responsible for setting up council 18 meetings? 19 A. Yes. 20 Q. Does the city council typically sit in the summer months? 21 A. Only for special council meetings. 22 Q. Now, the next sentence says: The agenda is not out yet and 23 she was inquiring whether she would be putting the Milio 24 Management "new and changed" Longfellow legislation on it. 25 What did you understand her to be referring to? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1456 C2tQann2 Kayal - Direct 1 A. The new and changed legislation for Longfellow. 2 Q. It says: As you know, it was changed by DelBello and Joe 3 Madden had reviewed it, which is the one you received Tuesday, 4 July 11th. Who is Joe Madden? 5 A. He was in our corporation counsel's office. 6 Q. And you indicated that you weren't there for that meeting? 7 A. Yes. 8 Q. Next wrote: She would like to circulate the new 9 legislation before the meeting as a reminder. She wants to 10 know if you want her to do that. The "she," that's Joan 11 Deierlein? 12 A. Correct. 13 Q. Who is the "you" you're referring to there? 14 A. Sandy Annabi. 15 Q. Did you receive a response to this? 16 Please, Mr. Turk, maximize the email. 17 A. Did I receive a response? 18 Q. Yes. 19 Just, Mr. Turk, if you would maximize the sentence 20 that starts "as of today." 21 Can you read that please aloud? 22 A. As of today, I may not be back for the August 15th meeting. 23 I may extend my trip. Do not put Milio on just yet. If I am 24 back by then. We can put it on. Also call Z and let him know 25 that the process was not outlined in the legislation and it SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1457 C2tQann2 Kayal - Direct 1 should be. They have to rewrite it. 2 Q. Now, when Ms. Annabi said "I may not be back forth 3 August 15 meeting," what did you understand her to be referring 4 to? 5 A. The special council meeting. 6 Q. That Ms. Deierlein was asking whether it should be 7 scheduled for August 15? 8 A. I believe so. 9 Q. And it says, "I may extend my trip." What did you 10 understand her to be saying there? 11 A. That she is going to extend her trip. 12 Q. The trip in Jordan? 13 A. Yes. 14 Q. It says, "Do not put Milio on just yet. If I am back by 15 then, we can put it on. Also call Z and let him know that the 16 process was not outlined in the legislation." Who did you 17 understand her to be referring to when she said Z? 18 A. Zehy. 19 Q. That's Zehy Jereis? 20 A. Yes. 21 Q. "They have to rewrite it." 22 MR. ARONWALD: I would ask that the entire sentence be 23 re-read, not just excerpts. 24 THE COURT: Please. Please. It's very hard to do 25 this piecemeal, piece by piece. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1458 C2tQann2 Kayal - Direct 1 MR. CARBONE: Would you like me to re-read it, your 2 Honor? 3 THE COURT: The entire sentence, if that's the way you 4 want to do this. 5 Q. As of today I may not be back forth August 15 meeting. I 6 may extend my trip. Do not put Milio on just yet. If I am 7 back by then, we can put it on. Also call Z and let him know 8 that the process was not outlined in the legislation and it 9 should be. They have to rewrite it. 10 THE COURT: What's the question? 11 MR. CARBONE: I already asked my questions. I was 12 just reading because Mr. Aronwald asked me to. 13 BY MR. CARBONE: 14 Q. Ms. Kayal, do you know why Zehy Jereis was involved with 15 the Longfellow legislation? 16 A. Not really. I mean, he -- he -- he was always involved 17 with politics. 18 Q. Do you know why Ms. Annabi asked you to contact him? 19 A. I can only assume. 20 THE COURT: No, the question is do you know -- did 21 she-- 22 THE WITNESS: Explain it to me? 23 THE COURT: Explain to you why she wanted contact. 24 THE WITNESS: I don't believe so. 25 THE COURT: Thank you. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1459 C2tQann2 Kayal - Direct 1 MR. CARBONE: Your Honor, I have no further questions. 2 We ask the witness be excused subject for recall to 3 cross-examination after lunch pursuant to our discussions. And 4 we can call our next witness. 5 THE COURT: Well, you know, no. Cross-examine. The 6 discussion -- let me tell you something, those discussions were 7 not shared with me this morning. If we're talking about the 8 general discussion we had yesterday afternoon? 9 MR. ARONWALD: No, Judge. I'm talking about the 3500 10 material. 11 THE COURT: I see. I see. I apologize. My bad. I 12 forgot. Yes. Go have lunch, a long lunch. I'll see you at 13 2:00. 14 Not you. Her. (Indicating). 15 (Witness excused) 16 THE COURT: Sorry about that. Completely slipped my 17 mind. Next witness. 18 MR. HALPERIN: Your Honor, the government calls 19 Antonio Milio. 20 THE COURT: Before anything happens, is this lady here 21 for a reason? 22 MR. HALPERIN: Yes. She is the interpreter, your 23 Honor. 24 THE COURT: All right. Ladies and gentlemen, 25 Mr. Milio is going to be testifying in this courtroom in this SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1460 C2tQann2 Kayal - Direct 1 proceeding in Italian through an interpreter. Should any of 2 you happen to speak Italian, va bene. 3 Now, if you speak Italian, I need to tell you that it 4 is what the interpreter says that is the official record in the 5 case. So that if you perceive some difference between what the 6 witness says and what the interpreter says, you have to pay 7 attention to the interpreter because she is the official record 8 in the case. 9 Can we first swear the interpreter? 10 (Interpreter sworn) 11 THE COURT: Now will you please swear the witness. 12 ANTONIO MILIO, 13 called as a witness by the Government, 14 having been duly sworn, testified as follows: 15 DIRECT EXAMINATION 16 BY MR. HALPERIN: 17 THE COURT: Sir, you have to speak Italian. You may 18 not speak English. 19 THE INTERPRETER: Response yes, yes. 20 THE DEPUTY CLERK: Tell us your full name and spell 21 that for us. 22 THE WITNESS: Antonio Milio, A-N-T-O-N-I-O; M-I-L-I-O. 23 THE COURT: You may inquire. 24 MR. HALPERIN: Thank you, your Honor. 25 Q. Mr. Milio, where do you live? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1461 C2tQann2 A. Milio - Direct 1 A. In Yonkers. 2 Q. How long have you lived in Yonkers? 3 A. 39 and a half years. 4 Q. How old are you, sir? 5 A. 66. 6 Q. What country were you born in? 7 A. In Italy. 8 Q. Did you grow up there? 9 A. Until I was 18 years old. 10 Q. How far did you go in school in Italy? 11 A. I finished high school. 12 Q. When you were 18, where did you emigrate to? 13 A. To Germany. 14 Q. How long did you live in Germany, roughly? 15 A. Almost nine years. 16 Q. After that, where did you emigrate to? 17 A. To the United States. 18 Q. What year did you come to the United States? 19 A. 1972. 20 Q. Are you now a United States citizen? 21 A. Yes. 22 Q. What's your first language, sir? 23 A. Italian. 24 Q. Do you speak English? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1462 C2tQann2 A. Milio - Direct 1 Q. How old were you when you learned English? 2 A. I was 27. 3 Q. Can you read English? 4 A. Not very well. 5 Q. Since you arrived in the United States in 1972, what have 6 you done for work? 7 A. First of all, I worked in a car wash. 8 Q. And then? 9 A. And after that I began to work for myself. 10 Q. Doing what type of work? 11 A. Construction. 12 Q. What's the name of your company that you work for now? 13 A. Milio Management. 14 Q. Is that a family business? 15 A. Yes, it is. 16 Q. Until the last few years, who owned Milio Management? 17 A. My brother and I. 18 Q. Who currently owns Milio Management? 19 A. My children and those of my brother. 20 Q. What's your brother's name? 21 A. Giuseppe Milio. 22 Q. What's your role in the business, sir? 23 A. I am the supervisor. I monitor everything. 24 Q. Which other family members work for the business? 25 A. My son Franco, and my daughter Carmela. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1463 C2tQann2 A. Milio - Direct 1 Q. Generally what does Milio Management do? 2 A. We manage buildings. We rent apartments. We make repairs 3 when necessary. 4 Q. Does the company own any properties? 5 A. Yes. 6 Q. Generally, where are the properties located? 7 A. Yonkers, Bronx, Monvello -- 8 Q. Mount Vernon. 9 A. Oh, Mount Vernon, Manhattan, sorry, Ossining, Dobbs Ferry 10 and Peekskill. 11 Q. Roughly, how many properties does Milio Management own? 12 A. They are buildings that house anywhere between one to 60 13 families, and they number in all between 30 and 35 properties. 14 Q. The 60 unit building, roughly how many stories is that? 15 A. Six floors. 16 Q. Mr. Milio, are you familiar with something called the 17 Longfellow project? 18 A. Yes. 19 Q. What was Milio Management trying to do in relation to the 20 Longfellow project? 21 A. We wanted to become the designated developer. 22 Q. In the spring of 2006, had Milio Management been approved 23 yet as the designated developer for Longfellow? 24 A. No. 25 Q. Around this time, did Milio Management hire an attorney to SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1464 C2tQann2 A. Milio - Direct 1 help with the Longfellow project? 2 A. Yes. 3 Q. Which attorney? 4 A. Anthony Mangone. 5 Q. Was Mangone the first attorney that you hired for the 6 project? 7 A. No. 8 Q. Which attorney had you hired previously? 9 A. Al DelBello. 10 Q. Why did your company decide to hire Anthony Mangone? 11 A. Because with Mr. DelBello we weren't making any progress. 12 Q. I direct your attention to about June 2006. Do you 13 remember speaking to your son Franco after he had spoken to 14 Mr. Mangone? 15 THE INTERPRETER: May I have the question again, 16 please. 17 Q. Directing your attention to about June 2006, do you 18 remember speaking to your son Franco after he had spoken to 19 Mr. Mangone? 20 A. Yes. 21 Q. Sometime after you spoke to Franco, what did you do next? 22 A. I brought $30,000 to Anthony Mangone. 23 Q. What form did you bring the money in: Cash, check, money 24 order? 25 A. Cash. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1465 C2tQann2 A. Milio - Direct 1 Q. Where did you bring the $30,000 in cash? 2 A. To his office in was that Oxton. 3 Q. Is that Hawthorne, New York? 4 THE INTERPRETER: Oh, Hawthorne. 5 Q. What county is that in, sir? 6 A. Westchester. 7 Q. What happened when you arrived at Mr. Mangone's office in 8 Hawthorne, New York? 9 A. There was a girl there who called him. He was upstairs. 10 (Continued on next page) 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1466 C2TUANN3 A. Milio - direct 1 Q. What happened next? 2 A. He came down. 3 Q. And what happened when he came down? 4 A. He greeted me, asked me how I was, what was going on and I 5 returned those greetings. 6 Q. What happened next? 7 A. I gave him the $30,000 in cash. 8 Q. What did Mr. Mangone say to you when you gave him the 9 $30,000 in cash? 10 A. This will help us. She is going on vacation, and she will 11 be very happy. 12 Q. When he said "she's going on vacation," who did you 13 understand Mr. Mangone to mean? 14 A. I understood him to mean Sandy Annabi. 15 Q. What position did Sandy Annabi hold? 16 A. Councilwoman. 17 Q. What did Councilwoman Annabi have to do with the Longfellow 18 project? 19 A. It was in her district. 20 Q. When you gave Mangone the money, was it before or after 21 Councilwoman Annabi went on her vacation? 22 A. Beforehand. 23 Q. About when did you bring Mangone the money? 24 A. Towards the end of June or beginning of July. 25 Q. What year? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1467 C2TUANN3 A. Milio - direct 1 A. 2006. 2 Q. Now, when you gave Mangone the money in his office, did you 3 also pay any of his legal fees? 4 MR. ARONWALD: Leading, your Honor. 5 MR. HALPERIN: I can rephrase, Judge. 6 THE COURT: Please do. 7 Q. How much money if any other money did you give Mr. Mangone 8 that day? 9 A. $10,000 more. 10 Q. For what reason? 11 A. To pay for four months in arrears plus one month advance. 12 Q. When you gave Mr. Mangone the $10,000, what did he say to 13 you about that? 14 A. He said you could have given me this 10,000 in a check. 15 Q. What happened next? 16 A. I said, well give them back to me and I will bring you a 17 check. 18 Q. What did he say next? 19 A. He said, no, no, it's fine, it's fine this way. 20 Q. How much had Milio Management agreed to pay Mr. Mangone per 21 month? 22 A. $2,000. 23 MR. ARONWALD: Judge, I couldn't hear that. 24 THE COURT: $2,000. 25 Q. So in total, sir, how much money did you give Mr. Mangone SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1468 C2TUANN3 A. Milio - direct 1 that day altogether? 2 A. $40,000. 3 Q. In what form, cash, check, money order? 4 A. Cash. 5 Q. Now, when you brought Mr. Mangone the $40,000 in cash, what 6 size bills was it in? 7 A. 100 dollars. 8 Q. How did you package the cash? 9 A. $10,000 in each package. 10 Q. So how many bundles were there in total? 11 A. Four. 12 Q. How were the packages wrapped. 13 A. With a rubber band. 14 Q. Where did you get the cash from, sir? 15 A. They were part of the rents that I collected. 16 Q. The rents for Milio Management? 17 A. Yes. 18 Q. Starting in about 2007, were you interviewed by federal 19 agents about what happened with the Longfellow project? 20 A. Yes. 21 Q. At some point did you and your son retain an attorney to 22 represent you in your dealings with the U.S. Attorney's office 23 and the FBI? 24 A. Yes. 25 Q. Who was your attorney? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1469 C2TUANN3 A. Milio - direct 1 A. Lorenzo Diagiansante. 2 Q. At some point did you and your son Franco begin cooperating 3 with the FBI and the U.S. Attorney's office? 4 A. Yes. 5 Q. What did you discuss as part of your cooperation? 6 A. I was told to tell the truth. 7 Q. What if anything did you say about some of your own wrong 8 conduct? 9 A. I said that I had not been paying all of the property 10 taxes. 11 THE INTERPRETER: Sorry. Interpreter correction: 12 A. I had not been paying the appropriate taxes. 13 Q. Mr. Milio, at some point were you charged with a federal 14 criminal charge? 15 A. Yes. 16 Q. Were you charged in an information? 17 A. Yes. 18 Q. What were you charged with? 19 A. Tax evasion. 20 Q. How many counts of tax evasion? 21 A. One. 22 Q. What happened with your case? Did you go to trial or plead 23 guilty? 24 A. I pled guilty. 25 Q. About how long ago did you plead guilty? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1470 C2TUANN3 A. Milio - direct 1 A. Approximately one month ago. 2 Q. At about the time of your guilty plea, did you enter into a 3 formal cooperation agreement with the government? 4 A. Yes. 5 Q. What is your understanding of what you must do under the 6 terms of the cooperation agreement? 7 A. I must tell the truth. 8 Q. And what is your understanding of what the government 9 agreed to do under the terms of the cooperation agreement? 10 A. To write a 5K letter. 11 Q. To whom? 12 To the judge? 13 A. I don't remember the name of the judge. 14 Q. What is your understanding of what the government's 5K 15 letter to the judge will say? 16 A. Everything good that I did and everything bad that I did. 17 Q. Have you been sentenced yet? 18 A. No. 19 Q. What is the maximum sentence you face at your sentencing? 20 A. Five years. 21 Q. Has the government promised to recommend a specific 22 sentence for you? 23 MR. ARONWALD: Objection. Leading. 24 THE COURT: Overruled. 25 Q. You can answer, sir. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1471 C2TUANN3 A. Milio - direct 1 A. No. 2 Q. Who decides what your sentence will be? 3 A. The judge what's his name. 4 Q. Judge what's his name. 5 Sir, why did you decide to cooperate with the 6 government? 7 A. To help myself and to help my family. 8 Q. And in part to help yourself get a lower sentence? 9 A. Yes. 10 Q. And your cooperation agreement, what if anything did you 11 admit about whether or not you had engaged in a tax evasion 12 scheme? 13 A. I did not declare the total amounts. 14 Q. What if anything did you admit about whether you had failed 15 to pay the full amount of corporate income taxes? 16 A. I admitted that I didn't pay them fully. 17 Q. What if anything did you admit about whether you had failed 18 to pay the full amount of personal income taxes? 19 A. I also admitted this, that I did not pay the entire 20 personal taxes. 21 Q. What if anything did you admit about whether you failed to 22 pay the full amount of payroll taxes? 23 A. I also admitted that. 24 Q. What if anything did you admit about whether you failed to 25 report rental income your company had received? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1472 C2TUANN3 A. Milio - direct 1 A. I admitted that I did not declare all of it. 2 Q. What if anything did you admit about whether you hired 3 employees who could not work in the country legally? 4 A. I admitted that. 5 Q. What if anything did you admit about whether you paid 6 employees in cash and did not report all the wages? 7 A. I also admitted that. 8 Q. What if anything did you tell the government about 9 possessing a handgun? 10 A. I admitted that also, that I possessed it. 11 Q. Was it licensed or unlicensed? 12 A. Without a license. 13 Q. Where did you keep the gun? 14 A. In the safe. 15 Q. What if anything did you tell the government about giving 16 tips and holiday gifts to some City of Yonkers employees? 17 THE INTERPRETER: May I have that again? 18 Q. What if anything did you tell the government about giving 19 tips and holiday gifts to some City of Yonkers employees? 20 A. I said that I did that, yes. 21 Q. Which city departments did some of the inspectors work for? 22 A. Building department, plumbers. 23 Q. What if any favors did you ask from these city employees? 24 A. I never asked for any favors. 25 Q. From 2000 to 2004, did you engage in any real estate deals SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1473 C2TUANN3 A. Milio - direct 1 to buy property? 2 A. Yes. 3 Q. What if anything did you tell the government about whether 4 you sometimes paid cash under the table to the seller in 5 addition to the listed sales price? 6 A. I did that and I admitted it. 7 Q. What if anything did you tell the government about loaning 8 money to an employee to help him get back into the country 9 illegally? 10 A. I did that. 11 Q. How many times? 12 A. Once. 13 Q. How much money did you loan the employee? 14 A. $3,300. 15 Q. When you were first interviewed by FBI agents in June 2007, 16 were you asked about whether you had given money to any public 17 official to obtain approval for a project? 18 A. They did ask me that. 19 Q. What did you say at the time? 20 A. I said no. 21 Q. Was that true or was that a lie? 22 A. It was a lie. 23 Q. When you lied to the government, was that before or after 24 you started cooperating with the government? 25 A. It was before. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1474 C2TUANN3 A. Milio - direct 1 Q. Let me ask again, what year did you come to the United 2 States, sir? 3 A. 1972. 4 Q. Let me direct your attention to 1973 or 1974. Was there a 5 Yonkers councilman who helped you with a driveway? 6 THE INTERPRETER: What was the function of the person? 7 MR. HALPERIN: Was there a Yonkers councilman? 8 A. Yes. 9 Q. How did the councilman help you? 10 A. He moved a parking meter. 11 Q. What did you do afterwards? 12 A. I gave him a gift of $50. 13 Q. What if anything did you and he discuss about the $50 14 before you gave him the $50? 15 A. Nothing. 16 Q. What form did you give him the money in, cash, check, money 17 order? 18 A. It was in cash. 19 Q. Aside from that $50 you gave the councilman in 1973 or '74 20 and the $30,000 you gave Mangone for Councilwoman Annabi, how 21 many other times did you give cash to an elected official? 22 A. Never. 23 MR. HALPERIN: No further questions. 24 MR. SIANO: Mr. Aronwald yields to me for me to go 25 first. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1475 C2TUANN3 A. Milio - direct 1 MR. ARONWALD: I am not yielding my position, just 2 yielding -- 3 THE COURT: You have never yielded your position, Mr. 4 Aronwald, in all of the years I have known you. 5 CROSS-EXAMINATION 6 BY MR. SIANO: 7 Q. Good afternoon, Mr. Milio? 8 A. Good afternoon. 9 Q. You can wait for the interpreter, if you would like. 10 I represent Mr. Jereis. I would like to ask you a few 11 questions, Mr. Milio. 12 Mr. Milio, you testified earlier -- 13 THE COURT: You need to wait for the interpreter. 14 THE INTERPRETER: Everybody needs to wait for the 15 interpreter. 16 Q. Mr. Milio, you testified earlier that you had a city 17 councilman help you with your driveway. Do you recall Mr. 18 Halperin asked you those questions? 19 A. Yes. 20 Q. He wasn't out there in coveralls working on the driveway, 21 was he, Mr. Milio? 22 A. No. 23 Q. Where you wanted to put the driveway, there was a parking 24 meter at the curb, correct? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1476 C2TUANN3 A. Milio - cross 1 Q. And you talked to the councilman about the fact that the 2 parking meter was in the way of your driveway, isn't that 3 right? 4 A. Yes. 5 Q. And did he come back with a saw and cut off the parking 6 meter at ground level himself, sir? 7 MR. HALPERIN: Objection. Relevance. 8 MR. SIANO: It will be clear in a moment, your Honor. 9 THE COURT: Objection overruled. 10 A. No. 11 Q. He went away and some workers for the city came and took 12 the parking meter away? 13 A. Yes. 14 Q. And after the parking meter went away, the city councilman 15 came back? 16 A. Yes. 17 Q. And that's when you gave him the $50? 18 A. Yes. 19 Q. And that's when no words were exchanged between you and the 20 councilman? 21 A. I just said thank you very much. 22 Q. Did he say thank you for the $50? 23 A. Yes. 24 Q. I see. 25 Now, you testified earlier that you pled guilty in SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1477 C2TUANN3 A. Milio - cross 1 front of a judge in White Plains, is that correct? 2 A. Yes. Judge Briccetti. 3 THE COURT: Which I do believe was probably the way 4 that the name was pronounced when the family came over, but I 5 will confirm that with him later. 6 Q. Mr. Milio, before you pleaded guilty, you read some 7 documents that the government gave you, isn't that right? 8 A. Yes. 9 Q. Let me show you what's been previously marked as Government 10 Exhibit 3519P and Government Exhibit 3519Q. Those are the 11 documents you read before you stood in front of the judge and 12 pleaded guilty, isn't that correct, sir? 13 A. Yes. 14 Q. And those documents were in the same form they are today, 15 isn't that right, Mr. Milio? 16 A. Yes. 17 Q. They are in English, aren't they? 18 A. Yes. 19 Q. And the government didn't give you a translation? 20 A. No. They didn't give one to me because I didn't ask for 21 one. 22 Q. When you spoke to the judge, you spoke English to the judge 23 and the judge spoke English to you, isn't that correct? 24 A. Yes. 25 Q. And during that guilty plea, you also read a document into SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1478 C2TUANN3 A. Milio - cross 1 the record, is that right? 2 A. My son read it. He was standing next to me. My lawyer was 3 also there. 4 Q. Mr. Milio, let me show you what's been previously marked as 5 Government Exhibit 3519R. Have you ever seen that document 6 prior to today, sir? 7 A. I think so. 8 Q. Do you recognize that, sir, as being your appearance in 9 front of the judge in White Plains where you entered your plea 10 of guilty? 11 A. I think so. 12 Q. All right. To help you see if you can identify that this 13 is in fact you at this proceeding, would you take your time, 14 sir, and read pages up through pages 5 and 6 -- if you could 15 read 5 and 6, please? 16 THE INTERPRETER: Question, your Honor, should I 17 translate this? 18 THE COURT: The witness, I believe, has testified that 19 he doesn't read English well, if I recall correctly, so I think 20 you will need to do that. 21 THE INTERPRETER: Thank you. 22 (Interpreter translating document to witness) 23 MR. SIANO: Up to line 19 would be fine. 24 THE COURT: On which page, Mr. Siano? 25 MR. SIANO: On page 6, the court reporter was on 6. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1479 C2TUANN3 A. Milio - cross 1 BY MR. SIANO: 2 Q. Mr. Milio, does that refresh your recollection that this 3 was the proceeding at which you pleaded guilty? 4 A. Yes. 5 Q. During that proceeding, the judge asked you to tell him in 6 your own words what you had done that was leading you to plead 7 guilty, isn't that right? 8 A. Yes. 9 Q. And you took out a piece of paper then to read to the judge 10 what your response was, isn't that correct? 11 A. Yes. 12 Q. And the piece of paper was in English? 13 A. Yes. 14 Q. And you read it out loud in open court in English? 15 A. I did read it, but don't ask me how many mistakes I made in 16 doing so. 17 Q. In fact you told the judge when you started you didn't have 18 your reading glasses with you when you were reading it? 19 A. I don't have the right reading glasses even today, and even 20 today I am not capable of reading. 21 Q. In the document that is marked 3519P, sir, if you would 22 look at 3519P and, particularly, the last page, page 5. Is 23 that your signature, sir? 24 A. Yes. 25 Q. You read this document before you signed it, sir? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1480 C2TUANN3 A. Milio - cross 1 A. As before, my son and the lawyer read it to me. 2 Q. And they explained it to you? 3 A. Yes. 4 Q. And you knew when you put your hand to this piece of paper, 5 it was an important document, isn't that correct? 6 A. Yes. 7 Q. And I believe you told Mr. Halperin earlier, you believed 8 this document exposed you to a potential for five years' 9 incarceration, is that correct? 10 A. Yes. 11 Q. And in this document on the second page, particularly in 12 the second paragraph, there is a recitation of some of the 13 things that you had done wrong, isn't that correct? 14 THE INTERPRETER: Do you want this paragraph 15 translated? 16 MR. HALPERIN: We will stipulate, Judge. 17 MR. SIANO: No. I would like the interpreter to read 18 the paragraph to Mr. Milio since I am going to ask one or two 19 questions about what is recited there. 20 (Interpreter translating document to witness) 21 BY MR. SIANO: 22 Q. Now, Mr. Milio, do you recall discussing those particular 23 bad acts in connection with your guilty plea at or about the 24 time that you appeared in front of the judge in White Plains? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1481 C2TUANN3 A. Milio - cross 1 Q. In fact, you understood that you were pleading guilty to a 2 single crime only in front of the judge, is that right? 3 A. I pled guilty to everything that you see here that is 4 written here. 5 THE COURT: He need to bring this to a close for 6 lunch. 7 MR. SIANO: That's fine, Judge. 8 THE COURT: Folks, I will see you at 2, about 5 after 9 2. 10 Don't discuss the case. Keep an open mind. 11 12 (Continued on next page) 13 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1482 C2TUANN3 A. Milio - cross 1 (Jury not present) 2 MR. ARONWALD: Your Honor, would it be OK that I not 3 interrupt Mr. Milio's cross-examination before I recall Debbie 4 for her cross-examination? 5 THE COURT: I can think of nothing I would like more 6 than to get Mr. Milio off the stand. 7 MR. SIANO: Could you admonish Mr. Milio? 8 THE COURT: Mr. Milio, do not talk to the prosecutors 9 over the lunch hour. 10 MR. SIANO: Or the agents, Judge? 11 THE COURT: Or anyone who works for the government. 12 (Luncheon recess) 13 14 (Continued on next page) 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1483 C2tQann4 1 (In open court; jury not present) 2 AFTERNOON SESSION 3 2:00 P.M. 4 THE DEPUTY CLERK: Case on trial continued. The 5 government and -- 6 MR. HALPERIN: Judge, before we get the witness -- 7 THE COURT: Hold on a second. 8 MR. SIANO: I have Mr. Aronwald's proxy -- the client 9 is here, Judge -- on this topic because Mr. Aronwald is 10 actually carrying out something that we talked about, so I will 11 allow Mr. Halperin to speak, please. 12 THE COURT: OK. 13 MR. HALPERIN: Thank you, Mr. Siano. 14 We've spoken to defense counsel. I think everyone is 15 in agreement, and what we've proposed in terms of scheduling is 16 interrupting Mr. Milio, bring out Ms. Kayal, so the defense can 17 cross her, and we can finish with her testimony. Then the 18 government has a five minute bank witness who flew in who needs 19 to get on today. 20 THE COURT: I don't have a sentencing. I can go until 21 after 5:00. I'm cool today. 22 MR. HALPERIN: We would, I think, rather get those two 23 witnesses out of the way and then I think everyone is in 24 agreement that we would bring Mr. Milio back after we do that, 25 if that's OK with the Court. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1484 C2tQann4 1 THE COURT: OK. 2 MR. HALPERIN: Also, I did speak to counsel for Forest 3 City Ratner about Bruce Bender, and neither Bruce Bender nor 4 his wife, Amy, have any relationship to Estelle Bender or to 5 that Stanley Isaacs family. 6 THE COURT: I will be sure somehow to tell him that. 7 Is it all right if Mr. O'Neill tells the juror or should I 8 bring the juror out and talk to the juror? 9 MR. HALPERIN: We're fine with Mr. O'Neill. 10 THE DEPUTY CLERK: I will simply say they checked it 11 out and there is no relationship. 12 THE COURT: Mr. Aronwald. 13 MR. ARONWALD: Do you want Ms. Kayal on the stand 14 before or after the jury comes in? 15 THE COURT: Get her in here now because we are going 16 to get the jury in. It's my fault. I'm the one who's late, 17 and I apologize. 18 (Continued on next page) 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1485 C2tQann4 1 (Jury present) 2 THE COURT: OK. Now, we interrupted a witness, and we 3 are going to finish that witness's testimony, Ms. Kayal. 4 Good afternoon. I hope you enjoyed your long lunch. 5 You are still under oath. 6 THE WITNESS: Yes, your Honor. 7 THE COURT: OK. 8 MR. ARONWALD: Thank you, your Honor. 9 DEBBIE KAYAL, resumed. 10 CROSS-EXAMINATION 11 BY MR. ARONWALD: 12 Q. Ms. Kayal, you and I have met before, correct? 13 A. Yes. 14 Q. OK. We have met to discuss the facts of this case, 15 correct? 16 A. Yes. 17 Q. I am going to try to make this as brief as I can. During 18 the period of time that you -- do you recall that during the 19 period of time that you were working for Sandy Annabi as her 20 legislative aide, do you recall where you were living during 21 the period March 2006? Do you remember where you were living 22 in March 2006? 23 A. I think it was 15 Westwood, Yonkers. 24 Q. Was there a period of time in 2006 when you were living 25 with your sister and brother-in-law? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1486 C2tQann4 Kayal - Cross 1 A. 34 Pinehurst drive. 2 Q. Was that in 2006? 3 A. Yes. 4 Q. Was that before Sandy took her trip to Jordan? 5 A. Let me try and get my thoughts here because we had sold our 6 house, moved in with my sister for a few months, then had to 7 move into my mother-in-law's house in that whole -- and I 8 started in March of 2006. Tell you the truth, I can't remember 9 where I was when she went to Jordan. 10 Q. OK. 11 A. It's very possible. 12 THE COURT: OK. But you can't remember exactly where 13 you were living at that moment, and that's what the state of 14 the record is, so let's ask our next question. 15 THE WITNESS: OK. 16 Q. Do you recall testifying in the grand jury? 17 A. Yes. 18 Q. That would have been on October 1, 2009? 19 A. Yes. 20 Q. During the period of time that you were working for Sandy, 21 do you know where it was that she was living? 22 A. Yes. 23 Q. Do you know -- would you tell us what the address was? 24 A. 245 Rumsey Road. 25 Q. Rumsey Road, that's in the city of Yonkers? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1487 C2tQann4 Kayal - Cross 1 A. Yes. 2 Q. In the second district? 3 A. Yes. 4 Q. Do you know where her parents were living at that time? 5 A. I know the street. Bacon. 6 Q. OK. Does the number 45 Bacon Place? 7 A. I was going to say 35. Yeah, 45. 8 Q. During the period of time that you were working for Sandy, 9 did you have occasion to go to her apartment at 245 Rumsey 10 road? 11 A. Yes. 12 Q. For what purpose? 13 A. Social and plus to drop documents off relating to work. 14 Q. When you say related to work, you mean related to her work 15 as a city councilwoman? 16 A. Yes. 17 Q. Were there occasions when you also dropped off documents at 18 her mother's place -- 19 A. Yes. 20 Q. -- at 45 Bacon. Now, how would you know whether to drop 21 the documents off at 245 Rumsey or 45 Bacon? 22 A. She would advise me. 23 Q. She being Sandy? 24 A. Sandy Annabi would tell me where to drop them. 25 Q. And to your knowledge during the period of time that you SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1488 C2tQann4 Kayal - Cross 1 were working for her, it wasn't unusual, was it, for her to 2 spend evenings at her parents' house at 45 Bacon? 3 A. No, I don't believe so. 4 Q. It was not -- 5 A. It was not unusual for her to be at her parents' home. 6 Q. In fact, did you ever describe her as a mama's girl? 7 A. Absolutely. 8 Q. By that you meant? 9 A. She is a mama's and a daddy's girl. Yes, she's very close 10 with her family. 11 Q. Now, did you ever have occasion to meet Zehy Jereis? 12 A. Yes. 13 Q. Do you recall how many times you saw Zehy Jereis? 14 A. Not really. 15 Q. Do you recall the first time you met Zehy Jereis? 16 A. Yes. 17 Q. Was that at a lunch with Sandy at a pizzeria in Yonkers? 18 A. Yes. 19 Q. Would it be fair to say that -- 20 A. Let me retract that. I believe I met him prior to that 21 too. I mean, he's been in Yonkers in, you know -- I believe 22 I've met him before lunch. 23 Q. OK. But do you have any kind of a relationship with him in 24 terms of a social or business relationship? 25 A. No. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1489 C2tQann4 Kayal - Cross 1 Q. Were there ever occasions when you saw Sandy Annabi and 2 Zehy Jereis interact with each other? 3 A. A few times. 4 MR. CARBONE: Objection. Beyond the scope of direct. 5 THE COURT: The objection is overruled at this moment. 6 Q. And did you ever see them fight with each other, argue with 7 each other? 8 A. Not that I can recall. 9 Q. Now, the exhibit that we put up on the screen before, and I 10 believe that was Government Exhibit 386. What exactly is 11 Government Exhibit 386? 12 A. I'm sorry, repeat that? 13 Q. What is it? 14 A. It's an email. 15 Q. It's an email. Did you send that email? 16 A. I don't believe so, no. 17 Q. Is there anything on it that would indicate who the 18 originator was or who the person was that was creating the 19 email? 20 A. Well, looks like it was left out "from" and "to." 21 Q. The portion that appears next to the date 7/11/06 and 22 7/10/06, is that something that you created? 23 A. No. 24 Q. To your knowledge, did you have anything at all to do with 25 the creation of this document 386? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1490 C2tQann4 Kayal - Cross 1 A. No. 2 Q. Did you tell that to the government when you appeared 3 before the grand jury? 4 A. To be honest, I don't know -- know if that was at the grand 5 jury. I don't recall. 6 Q. What about Government Exhibit 770? Could we have that up, 7 please. 8 Now, did you recognize this document before 9 Mr. Carbone showed it to you when you were on the stand earlier 10 today 11 A. Again, six years ago, no, you know, I don't remember, but 12 this looks like something I -- yes, at the bottom portion, 13 obviously, it says it's from me, but, yes, that looks like 14 something I would have wrote. 15 Q. Now, the reference to DelBello, do you know who DelBello 16 is? 17 A. Yes. 18 Q. Could you tell us who that is? 19 A. Al DelBello, he's another lawyer for the city. 20 Q. Than does he have an office in Westchester County? 21 A. I believe so. 22 Q. Did he have anything at all to do with the Milios in 23 connection with Longfellow? 24 A. He was the attorney for the Milios. 25 Q. And Joe Madden I think you said is with the corporation SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1491 C2tQann4 Kayal - Cross 1 counsel's office? 2 A. Correct. 3 Q. Now, the words new and changed, quote, "new and changed" 4 Longfellow legislation. Do you know what that refers to, the 5 "new and changed"? 6 A. Yes, legislation changes a lot, and the legislation was 7 written and there are certain requirements that weren't on 8 there that needed to be changed. 9 Q. Certain requirements; in other words, certain language in 10 terms of what the resolution would consist of? 11 A. Yes. 12 Q. With respect to what the Milios were going to be doing in 13 connection with the Longfellow project? 14 A. Yes. 15 Q. And those changes, those were changes -- do you know who 16 had been responsible for insisting that those changes be made? 17 A. Well, Sandy insisted the changes be made. 18 Q. Now, this is basically for a meeting that was supposed to 19 take place originally on July 11, according to this document, 20 correct? In other words, the meeting had originally been 21 scheduled for July 11, but it got moved, didn't it? 22 A. Yes. 23 Q. And the Joan that you're referring to, that was the city 24 clerk, correct? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1492 C2tQann4 Kayal - Cross 1 Q. And the city clerk, one of the city clerk's jobs is to 2 basically create and set up the agenda for distribution to city 3 council members before the meeting so that they would know what 4 agenda items were going to be discussed, right? 5 A. Yes. 6 Q. That agenda would also be published publicly so that the 7 public -- 8 A. Yes. 9 Q. -- so that the public would know what was going to be 10 taking place at the city council meeting, correct? 11 A. Correct. 12 MR. ARONWALD: You can take that down. Thank you. 13 Q. Now, during the period that Sandy was in Jordan, did you 14 have occasion to have discussions with Franco Milio directly 15 about the Longfellow project? 16 A. I believe so, yes. 17 Q. Did those discussions include the changes that needed to be 18 made pursuant to Sandy's instructions to you? 19 A. Yes. 20 Q. It's true, is it not, that Sandy had insisted that the 21 resolution contain language providing affordable housing for 22 the seniors living in her district, correct? 23 A. Right. 24 Q. When you spoke to Franco Milio, he told you, didn't he, 25 that that would not be a problem? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1493 C2tQann4 Kayal - Cross 1 MR. CARBONE: Objection. Hearsay. 2 THE COURT: The objection is overruled. 3 Q. That means you can answer. Did you hear my question? Do 4 you want me to repeat it? 5 A. No, you don't have to repeat it. Yes, he knew what 6 changes -- 7 THE COURT: It's a yes-or-no question. 8 A. All right, repeat it. 9 Q. My question was: It's true, is it not, that Franco Milio 10 told you that that would not be a problem? 11 A. Yes. 12 Q. Did you also tell him that you had been instructed by Sandy 13 Annabi to tell him that the matter, the resolution, would not 14 be placed back on the agenda unless and until the resolution 15 was reworded to include the language -- 16 A. Yes. 17 Q. -- providing seniors exclusive -- right, is that correct? 18 THE COURT: You've got to wait until he's done asking 19 the question. You can't anticipate -- you really have to wait 20 until he stops talking. 21 Q. OK. So it's true, is it not, that you told Franco Milio 22 that you had been instructed by Sandy Annabi to tell him that 23 the Longfellow resolution would not be placed back on the city 24 council agenda unless and until the resolution was reworded and 25 modified? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1494 C2tQann4 Kayal - Cross 1 A. Yes. 2 Q. And after that, Franco Milio sent to you reworded versions 3 which you reviewed while Sandy was away, correct? 4 A. Yes. 5 Q. Did you also attend town hall meetings at Trinity Church 6 that were organized by Sandy Annabi to allow the public, the 7 constituents to hear whatever views had to be expressed 8 concerning Longfellow? 9 A. Yes. 10 MR. CARBONE: Objection. Beyond the scope of direct. 11 THE COURT: The objection is sustained. Don't answer. 12 Q. Now, in connection with -- Mr. Carbone asked you on direct 13 whether you and Sandy had ever traveled together. Do you 14 recall that question? Well, if not, let me ask the question. 15 Did you and Sandy ever have occasion to travel together? 16 A. Yes. 17 Q. Was that business or social? 18 A. Business. 19 Q. That was in connection with her business as a city 20 councilwoman or with her other business activities at St. 21 Joseph's? 22 A. City councilwoman. 23 Q. You never had any conversations -- withdrawn. You never 24 had any conversations or discussions, emails or the like with 25 Anthony Mangone about the Longfellow project, did you? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1495 C2tQann4 Kayal - Cross 1 A. In what context? 2 Q. In any context. 3 A. As far as scheduling? Like if something was on the agenda, 4 that would be about it. 5 Q. And when did that take place? 6 A. If it was supposed to go on a real estate agenda, I would 7 not know what date that was. 8 Q. But in connection with any discussions you had about the 9 legislation -- 10 A. No. 11 Q. -- or any changes in legislation, did you ever have any 12 discussions about that with Anthony Mangone? 13 A. No. 14 Q. Do you recall Anthony Mangone ever calling the office to 15 speak to Sandy Annabi? 16 A. No. 17 Q. Do you recall Anthony Mangone ever calling the office to 18 speak to any other council member? 19 A. Yes. 20 Q. What council member was that? 21 A. Pat MacDow. 22 Q. And Pat MacDow had to do with School 6? 23 A. Yes. 24 Q. But not Longfellow, correct? 25 A. I don't believe so. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1496 C2tQann4 Kayal - Cross 1 Q. Do you recall Anthony Mangone ever sending any emails to 2 Sandy Annabi in connection with Longfellow? 3 A. Don't recall. 4 Q. Do you recall Sandy Annabi ever sending any emails to 5 Anthony Mangone concerning Longfellow? 6 A. No. 7 Q. In fact, isn't it true that as far as you knew, Anthony 8 Mangone did not represent the Milios until after the Longfellow 9 resolution was passed? 10 A. Correct. 11 MR. ARONWALD: No further questions. Thank you. 12 MR. SIANO: No questions, your Honor. 13 THE COURT: Anything else? 14 MR. CARBONE: Yes, one moment, your Honor. 15 REDIRECT EXAMINATION 16 BY MR. CARBONE: 17 Q. Good afternoon, Ms. Kayal. Ms. Kayal, is it fair to say 18 that you had no reason to believe that Zehy Jereis and Sandy 19 Annabi had any kind of close relationship or romantic 20 relationship? 21 A. That's not what I said. 22 Q. I'm sorry, I'm asking -- 23 THE COURT: She said that's not what she said, OK. 24 She's answered your questions. So see if you can ask another 25 question and a less leading one. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1497 C2tQann4 Kayal - Redirect 1 BY MR. CARBONE: 2 Q. Ms. Kayal, were Sandy Annabi and Zehy Jereis close friends? 3 MR. ARONWALD: Your Honor, I'm going to object to any 4 leading questions. 5 THE COURT: Yes. How would you describe the 6 relationship between Ms. Annabi and Mr. Jereis? That is a 7 proper question. Please describe their relationship as you 8 understand it to be. 9 THE WITNESS: As I understand it to be, I thought they 10 were very close friends, not necessarily working partners, but, 11 you know, I know he had helped with her -- as a guru and 12 certain ways in her career, but other than that, I would say 13 friends. 14 Q. You do recall testifying in the grand jury on October 1, 15 2009? 16 A. Yes. 17 Q. And you were under oath? 18 A. Yes. 19 Q. Do you recall being asked this question, this series of 20 questions and did you give these answers -- 21 THE COURT: Page and line. 22 MR. CARBONE: That's page 56/line 15. 23 MR. ARONWALD: Your Honor, I don't believe she's 24 testified she had a failure to recall. 25 THE COURT: Indeed, she has not. He is going to SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1498 C2tQann4 Kayal - Redirect 1 impeach her. He is about to impeach her. That is the 2 procedure he is following. He is impeaching his own witness. 3 Q. "Q. Were they close friends, if you know? 4 "A. Sandy and Zehy? 5 "Q. Yes. 6 "A. I wouldn't know. I have no idea. 7 "Q. Well, how many times would you say you've seen them -- 8 seen him, as to Mr. Jereis? 9 "A. Twice, two to three times. I would not say often, if 10 anything. 11 "Q. So, is it fair to say based on your observations then that 12 they don't have a close relationship? 13 "A. Again, I wouldn't know. I don't know the relationship 14 that Sandy may have with anybody. 15 "Q. You worked with Sandy Annabi for what period of time? 16 "A. Two years. 17 "Q. During that two-year period, did you see her on a 18 day-to-day or weekly basis? 19 "A. At least once a week, but maybe more, at least once a 20 week." 21 Do you recall being asked those questions and did you 22 give those answers? 23 A. I recall being questioned. Do I know specific questions 24 and answers? No, I would not remember. 25 MR. CARBONE: Your Honor, I offer page 56 through page SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1499 C2tQann4 Kayal - Redirect 1 57 from lines 15 on page 56 through page 57 -- 2 THE COURT: Ladies and gentlemen, this is being 3 offered into evidence for the purpose of, as I told you, 4 impeaching the witness. That is, suggesting that testimony 5 that she has given to you here at the trial is not truthful. 6 It's offered for no other purpose at all. The witness' 7 testimony is the testimony you have heard her give under oath 8 on the witness stand; and the only purpose for which you may 9 consider the evidence that is being offered from the grand jury 10 testimony is in deciding whether in fact she is or is not 11 telling you the truth as she sits here today. 12 It is admitted for that limited purpose. 13 MR. CARBONE: Thank you, your Honor. 14 (Government's Exhibit Page 56 and 57 grand jury 15 testimony received in evidence) 16 Q. Ms. Kayal, was Anthony Mangone working together with Al 17 DelBello on the Milio project? 18 A. Not that I know of. 19 Q. Page 81/line 13: Ms. Kayal, do you recall being asked this 20 series and questions and did you give these answers: 21 "Q. Now, your brother-in-law, Anthony Mangone, represented the 22 Milios in some capacity during that time? 23 "A. In some capacity, I don't know that, I thought he was 24 working with Al. 25 "Q. DelBello? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1500 C2tQann4 Kayal - Redirect 1 "A. DelBello. 2 "Q. When you say 'he' just for the record, you thought the 3 Milios" -- interruption. 4 "A. No, I thought Anthony Mangone was working with Al 5 DelBello. The last time I knew, Al DelBello was the lawyer for 6 them, and then Anthony Mangone turned up at one of the real 7 estate meetings, and I thought at the time that he was working 8 with them, and then I found out that he wasn't. OK. 9 "Q. You mean then when you say at the time, you mean around 10 2006? 11 "A. You know what, this lasted from 2006 till 2008. I 12 couldn't pin down a date in which these meetings were unless 13 you have something." 14 Do you recall being asked that series of questions and 15 did you give those answers? 16 A. Again, it was a long time ago, so I don't recall, and I 17 don't recall giving those answers, but I could say that Al 18 DelBello worked prior to Anthony on this as a lawyer, and as 19 far as I know, that he wasn't working at the same time, but I 20 thought, you know -- I mean, I don't know these things because 21 I'm not involved with who Milio hired and who he didn't. So 22 whoever shows up at the council meeting I see them. 23 Q. And Anthony, your brother-in-law, showed up at a council 24 meeting, correct? 25 A. At a real estate meeting. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1501 C2tQann4 Kayal - Redirect 1 Q. At a real estate meeting? 2 A. As far as I can recall, yes. 3 Q. And you believe at the time that he was working with Al 4 DelBello, correct? 5 A. At that time? Probably. 6 MR. CARBONE: No further questions. Thank you. 7 MR. ARONWALD: Briefly. 8 THE COURT: Yes, Mr. Aronwald. 9 RECROSS EXAMINATION 10 BY MR. ARONWALD: 11 Q. The fact of the matter is that as far as you knew, Anthony 12 Mangone was not the attorney for Milio Management Company until 13 after the Longfellow resolution was passed, correct? 14 A. At this point, no, I don't know. 15 Q. Well, didn't you just testify a few moments ago that as far 16 as you know, Al DelBello continued to represent Milio 17 Management until the resolution was passed and then Anthony 18 Mangone began representing them? 19 A. All's I could say is I remember Al representing Milio and 20 then Anthony representing Milio. To tell you the truth, I can 21 not recall whether or not the resolution was done, set, or 22 changed or not done or passed; in between those two things. 23 Q. Do you remember telling anyone -- withdrawn. Would you 24 describe Sandy Annabi as a private person? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1502 C2tQann4 Kayal - Recross 1 Q. And you remember saying that she does not discuss her 2 personal life with you? 3 MR. CARBONE: Objection. Hearsay. 4 THE COURT: Overruled. 5 A. To you, yes. 6 Q. OK. And that was the truth, correct? 7 A. Yes. 8 MR. ARONWALD: No further questions. Thank you. 9 MR. SIANO: No questions. 10 MR. CARBONE: Nothing further. Thank you, your Honor. 11 THE COURT: Ms. Kayal, you're done. 12 (Witness excused) 13 THE COURT: Call your next witness, please. It's 14 still not going to be Mr. Milio because it's going to be 15 somebody else. 16 MR. HALPERIN: Your Honor, the government calls Rashad 17 Blanchard. 18 RASHAD BLANCHARD, 19 called as a witness by the Government, 20 having been duly sworn, testified as follows: 21 DIRECT EXAMINATION 22 BY MR. HALPERIN: 23 THE DEPUTY CLERK: Tell us your full name. 24 THE WITNESS: My name is Richard Blanchard. 25 THE DEPUTY CLERK: Spell it. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1503 C2tQann4 Blanchard - Direct 1 THE WITNESS: That's R-A-S-H-A-D. Blanchard, 2 B-LA-N-C-H-A-R-D. 3 THE COURT: You may inquire. 4 MR. HALPERIN: Thank you, your Honor. 5 BY MR. HALPERIN: 6 Q. Good afternoon, Mr. Blanchard. Where are you employed, 7 sir? 8 A. I'm employed by Ocwen, O-C-W-E-N, Loan Servicing. 9 Q. What's your title at Ocwen Loan Servicing? 10 A. I am a loan analyst. 11 Q. How long have you been employed by Ocwen? 12 A. Over a year and a half. 13 Q. Where is Ocwen located? 14 A. It's located in West Palm Beach, Florida. 15 Q. What are your duties and responsibilities as a loan analyst 16 at Ocwen? 17 A. We analyze, review and check accounts, mortgages, that is, 18 and assist the legal department. 19 Q. Are you also a custodian of records? 20 A. Yes, we are. 21 Q. What do you do as a custodian of records? 22 A. We manage and maintain accounts, and we maintain the 23 account and are responsible for that, the records. 24 Q. Are you familiar with the books and records of Ocwen? 25 A. Yes, I am. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1504 C2tQann4 Blanchard - Direct 1 Q. Are you familiar with a company named Fremont Investment 2 and Loan? 3 A. Yes, I am. 4 Q. What's the relationship between Ocwen and Fremont 5 Investment and Loan? 6 A. Fremont originated the loan that Ocwen serviced for the 7 borrower, where the -- I'm sorry, Fremont is the originating 8 lender of the loan that we service where Sandy Annabi is the 9 borrower. 10 Q. What year did that loan happen to Ms. Annabi? 11 THE COURT: Her name is pronounced Annabi, by the way, 12 OK. Not Annabi. 13 Q. You wouldn't know that. 14 THE COURT: That's the joke. That's why we're all 15 laughing. We are not laughing at you. 16 Q. What year did that loan occur from Fremont? 17 A. 2004. 18 Q. Roughly, when did Ocwen begin servicing that loan? 19 A. January 2005. 20 Q. Who maintains the records for Fremont's 2004 loan to Sandy 21 Annabi? 22 A. Ocwen. 23 Q. I'm going to show you what's been marked for identification 24 in front of you as Government Exhibit 450, 451, 452, 453A 25 through H, 454, 455, 456, 457, 458, 458A, 459, 460, 461, 462, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1505 C2tQann4 Blanchard - Direct 1 463, 464 through 467, 471 and 471A. And so I don't have to 2 repeat those numbers, I'll just refer to them as the Ocwen 3 documents, sir. 4 A. OK. 5 Q. Sir, do you recognize these documents? 6 A. Yes, I do. 7 Q. Have you reviewed all these exhibits before your testimony 8 here today? 9 A. Yes, I have. 10 Q. Which borrower do these records relate to? 11 A. Sandy -- and forgive me if I mispronounce the name -- 12 Q. That's OK, do your best. 13 A. -- Annabi. 14 Q. Sandy Annabi? 15 A. That's Sandy Annabi. 16 Q. What was the address of the property for the loan? 17 A. 13 Patton Drive, Yonkers, New York, 10710. 18 Q. How many loans does Ocwen maintain the records for related 19 to this borrower? 20 A. Two. 21 Q. Did both loans relate to the same property? 22 A. Yes, they did. 23 Q. What were the two different types of loans? 24 A. The first loan was -- there's a first and a second. The 25 first was for $130,100. The second was for $50,600. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1506 C2tQann4 Blanchard - Direct 1 Q. Are all these records kept in the regular course of Ocwen's 2 business? 3 A. Yes, they are. 4 Q. Is it the regular practice of Ocwen to make and keep such 5 records? 6 A. Yes, it is. 7 Q. Are the entries on the records made or are the documents 8 received at or near the dates reflected on the documents? 9 A. Yes, they are. 10 Q. Are the documents created by or based on information 11 received from someone with knowledge of the transaction? 12 A. Yes. 13 MR. HALPERIN: Your Honor, the government offers into 14 evidence what I collectively refer to as the Ocwen documents. 15 MR. ARONWALD: No objection, your Honor. 16 MR. SIANO: No objection, your Honor. 17 THE COURT: Admitted. 18 (Government's Exhibits 450, 451, 452, 453A through H, 19 454, 455, 456, 457, 458, 458A, 459, 460, 461, 462, 463, 464 20 through 467, 471 and 471A received in evidence) 21 MR. HALPERIN: Nothing further. Thank you, sir. 22 MR. ARONWALD: No questions. 23 MR. SIANO: No questions. 24 THE COURT: You are excused. Thank you. 25 (Witness excused) SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1507 C2tQann4 Blanchard - Direct 1 THE COURT: That was efficient. 2 Now, are we returning to Mr. Milio now. 3 MR. CARBONE: Yes. 4 THE COURT: So let's get Mr. Milio back in. 5 ANTONIO MILIO, resumed. 6 CROSS-EXAMINATION 7 BY MR. SIANO: 8 THE COURT: Mr. Milio, you are still under oath. 9 THE WITNESS: Naturally. 10 THE COURT: Mr. Siano. 11 MR. SIANO: Consult with the government. 12 (Pause) 13 BY MR. SIANO: 14 Q. Mr. Milio, I put up a blue tag for Defense Exhibit 48 on a 15 letter that you identified as being the letter you signed this 16 morning. Is that, in fact, your plea agreement now that you've 17 had a chance to look at it? 18 A. Yes. 19 MR. SIANO: I offer in evidence Defense Exhibit 48. 20 MR. HALPERIN: Can I just see it for one moment, 21 Judge? 22 THE COURT: Sure. 23 MR. HALPERIN: No objection. 24 THE COURT: Admitted. 25 (Defendant's Exhibit 48 received in evidence) SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1508 C2tQann4 A. Milio - Cross 1 Q. Now, on the second page of that document, sir, you 2 described the fact that you failed to pay payroll taxes for 3 your employees? 4 A. Yes. 5 Q. And you're familiar with the term paying a worker cash off 6 the books? 7 A. Yes. 8 Q. When is the first time you paid one of your workers cash 9 off the books? 10 A. I don't recall. 11 Q. Well, did it start in the 1970s, sir? 12 A. No, because I didn't yet have any employees. 13 Q. When did you first have employees, sir? 14 A. I don't recall. 15 Q. But it started as soon as you had employees? 16 A. Could be, yes. 17 Q. Well, when you had employees, were the first employees 18 family members? 19 A. Yes. 20 Q. Did you pay them off the books? 21 A. Yes. 22 Q. So your first employees were members of your own family and 23 you paid them cash off the books? 24 A. One could say that members of my family worked for me, and 25 I worked for them. It was a mutual sense of things. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1509 C2tQann4 A. Milio - Cross 1 Q. And nobody worked for the taxing authorities, is that 2 correct? 3 A. No. 4 Q. That is correct what I said? 5 THE COURT: Yes, I think that's what he said. 6 MR. SIANO: Well, I want to find out, Judge. 7 THE COURT: Did anyone pay taxes? 8 THE WITNESS: Perhaps not. 9 (Continued on next page) 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1510 C2TUANN5 A. Milio - cross 1 MR. SIANO: Perhaps not. 2 THE COURT: I simply want to point out, and I realize 3 the equivocal nature of the witness's response, but I want to 4 point out that I asked a direct question and you asked an 5 indirect question, so I would rather you ask direct questions. 6 MR. SIANO: There is no guarantee about not getting 7 the subjunctive anyway, Judge, but that's all right. 8 BY MR. SIANO: 9 Q. In addition to not paying payroll taxes, the money that you 10 earned from the rent, Milio Management did not pay income 11 taxes, did it? 12 A. Not for the entire quantity, no. 13 Q. When you went to court in front of the judge in White 14 Plains to plead guilty, there was a specific amount of unpaid 15 income taxes that you told the judge about, isn't that correct, 16 sir? 17 A. Yes. 18 Q. If you would be kind enough, sir, to look at page 36 of 19 your plea allocution, Government Exhibit 3519R. 20 THE INTERPRETER: Which lines would you like? 21 MR. SIANO: If you would be kind enough to read lines 22 9 through 12 exactly. 23 (Interpreter translation to the witness) 24 Q. You heard Mr. Halperin say to the judge that you owed 25 corporate and personal income taxes for the years 2006 through SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1511 C2TUANN5 A. Milio - cross 1 2008 totaling approximately $2,172,554, is that correct? 2 A. Yes. 3 Q. And you said to the judge the same thing three pages later 4 at page 38. 5 If you would look, sir, at lines 13 through 20, read 6 those or have the interpreter read them to you. 7 (Interpreter translating to the witness) 8 A. Yes. 9 Q. So all of this happened in front of the judge in White 10 Plains, all in English, is that correct? 11 A. Yes. 12 Q. And now here today I am asking you, how much rental income 13 approximately was it in the years 2006 to 2008 that you didn't 14 put on the tax returns, approximately? 15 A. I just cited the $2,172,554, didn't I? 16 Q. You did. That's the taxes, sir. I want to know what the 17 income was that led to the tax obligation. 18 A. I don't know. 19 Q. Did you ask anybody? 20 A. No. 21 Q. Did you have any concern whatsoever that the number might 22 have been wrong? 23 A. I didn't ask anyone and I don't know. 24 Q. Do you care? 25 A. I do care. It is important for me, but I don't know. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1512 C2TUANN5 A. Milio - cross 1 Q. In fact, you knew when you stood in court in front of the 2 judge saying all of these things in English, you knew that you 3 hadn't reported all of the rental income for many years prior 4 to 2006, isn't that right? 5 A. Yes. 6 Q. And you knew you hadn't paid the taxes on all of that 7 revenue, rental income for all of those many years too, didn't 8 you, Mr. Milio? 9 A. Yes. 10 Q. Now, in your letter which is the exhibit I just put in on 11 page 2, besides not paying the income taxes, you also 12 acknowledged on page 2 that you failed to pay payroll taxes for 13 your workers, isn't that right? 14 A. Yes. 15 Q. Is that correct, sir? 16 A. It is correct. 17 Q. In fact in front of the judge, if you would look at the top 18 of page 39, you told the judge for the years 2006 to 2008 the 19 unpaid payroll takes were $2,103,751, isn't that correct? 20 You knew that was the number that you were pleading 21 guilty to? 22 A. Yes. 23 Q. You knew that that scheme to pay workers without 24 withholding the payroll taxes went back many years prior to 25 2006, isn't that right? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1513 C2TUANN5 A. Milio - cross 1 A. Yes. 2 Q. Did you ask anybody how many dollars in wages in the years 3 2006 through 2008 led to this liability of $2,103,751 in 4 payroll taxes? Did you ask anybody, how many dollars in wages 5 am I accused of? 6 A. No. I did not ask. 7 Q. Did you care? 8 A. At this point nothing individually was important to me. I 9 was guilty of all of this. 10 Q. You weren't pleading guilty to all of anything, were you, 11 Mr. Milio? 12 MR. HALPERIN: Objection. Ambiguous. 13 THE COURT: Overruled. 14 Answer the question. 15 THE INTERPRETER: I am going to repeat the question. 16 THE WITNESS: I pled that I was guilty of not having 17 paid payroll, income, corporate and personal taxes. 18 BY MR. SIANO: 19 Q. Only for the years 2006 through 2008, Mr. Milio, isn't that 20 true? 21 A. Yes. 22 Q. Now, your plea agreement also refers to the fact that for 23 many years you owned an illegal handgun, isn't that right? 24 A. Yes. 25 Q. It is an automatic pistol, wasn't it? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1514 C2TUANN5 A. Milio - cross 1 A. I don't know. I never tried it. 2 Q. Let's talk about that for a while. 3 You surrendered the handgun to the government at some 4 point, isn't that correct? 5 A. Yes. 6 Q. And along with the handgun, you surrendered two magazines, 7 isn't that right? 8 MR. HALPERIN: Objection. Relevance. 9 A. What are two magazines? 10 THE COURT: Overruled. 11 Q. Mr. Milio, there was a little hole in the handle? 12 A. Yes. 13 Q. And there was a little piece of metal that went up into the 14 hole in the handle, isn't that right? 15 A. Exactly. 16 Q. And you surrendered two of those little pieces of metal 17 that went up into the handle, isn't that correct? 18 A. Yes. 19 Q. And you know those are the magazines that I was referring 20 to, isn't that correct, Mr. Milio? 21 A. Yes. 22 Q. And you bought this gun from your friend Adolfo? 23 THE INTERPRETER: Bought or brought? 24 MR. SIANO: Bought. 25 THE INTERPRETER: Thank you. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1515 C2TUANN5 A. Milio - cross 1 A. No, I didn't buy it; it was a gift. 2 Q. He gave you an illegal handgun? 3 A. That's correct. 4 Q. And he gave you the two magazines? 5 A. Yes. 6 Q. When the government asked you where the handgun came from, 7 you told them you didn't remember the gentleman's last name? 8 A. Yes. 9 Q. And that is not 100 percent true, is it, Mr. Milio? 10 A. It is 100 percent true. 11 Q. Did Adolfo give you 131 rounds of ammunition for that 9 12 millimeter handgun? 13 MR. HALPERIN: Objection. Relevance. 14 THE COURT: Overruled. 15 A. Yes. He did give it to me. 16 Q. Exactly 131 rounds of ammunition? 17 A. Yes. But I never used that gun. 18 THE COURT: That really wasn't the question. Answer 19 the question. 20 Q. Did you ever put any of those bullets in the magazines? 21 A. No. 22 Q. Did you ever put the magazines in the handgun? 23 MR. HALPERIN: Objection. Relevance to credibility. 24 THE COURT: Overruled. 25 A. Never. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1516 C2TUANN5 A. Milio - cross 1 Q. I believe you said you had a safe in your office? 2 A. Yes. 3 Q. And you kept the handgun in the safe? 4 A. It wasn't in the office. 5 Q. I didn't ask you where the safe was. Was the handgun in 6 the safe? 7 A. Yes. 8 Q. Where was the safe? 9 A. At my home. 10 Q. And the bullets were in the safe? 11 A. Yes. 12 Q. And the magazines were in the safe? 13 A. Yes. 14 Q. Did you store some of these $100 bills in your safe? 15 A. Yes, in the beginning. 16 Q. What constitutes the beginning? 17 A. Yes. There was also money there. 18 Q. The safe came with money in it? 19 A. No. 20 Q. When did you start putting cash you were taking out of your 21 business into the safe in your house, sir? 22 A. I don't recall. 23 Q. It was before you acquired the handgun as a gift from 24 Adolfo? 25 MR. HALPERIN: Objection to form. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1517 C2TUANN5 A. Milio - cross 1 A. I don't recall. 2 THE COURT: Overruled. 3 The answer is "I don't recall." 4 Ask your next question. 5 BY MR. SIANO: 6 Q. Now, you testified on direct you have somewhere between 30 7 and 35 buildings, is that correct, sir? 8 A. Yes. 9 Q. In about 2006, how many buildings did you have? 10 A. Perhaps 30. 11 Q. And how many tenants did you have, approximately? 12 A. I don't know. 13 Q. Would you say approximately 400 tenants, sir? 14 A. Perhaps more. 15 Q. 500 tenants? 16 A. I don't recall, and I don't want to just quote a number 17 without knowing that it is correct. 18 Q. And these tenants were obligated to pay your company rent 19 every month? 20 A. That's correct. 21 Q. Some of the tenants paid rent by check, is that correct? 22 A. Yes. 23 Q. And some of the tenants paid rent in cash? 24 A. That's correct. 25 Q. Did you ever encourage tenants to pay their rent in cash? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1518 C2TUANN5 A. Milio - cross 1 A. No. 2 Q. Who collected the rents for Milio Management in the year 3 2006, sir? 4 A. My office did. Every month they would send a bill. 5 Q. And who sent out the bills? 6 A. My son who was working in the office. 7 Q. Franco? 8 A. Yes, correct. 9 Q. When the rent came in, who opened the envelopes and counted 10 the rent? 11 A. It could have been either my son or my daughter, one of the 12 two. 13 Q. So Carmela was one of the people who counted the rent 14 money? 15 A. That's correct. 16 Q. Did you have a procedure, sir, as to handling checks with 17 regard to an accounts receivable ledger of any kind? Did you 18 keep an accounts receivable ledger of any kind? 19 A. Yes. 20 Q. Did that accounts receivable ledger list all of the rents 21 from all of the tenants every month? 22 A. Yes. 23 Q. Did you only have one set of such accounts receivable 24 ledgers for the rents, sir, or did you keep a separate ledger 25 for the cash? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1519 C2TUANN5 A. Milio - cross 1 A. Just one set. 2 Q. Did you give that set of books to your accountant? 3 A. Yes. 4 Q. How did you hide the revenue to keep it off your tax 5 returns, sir? 6 A. I didn't hide -- 7 THE INTERPRETER: Let me get this again, if you don't 8 mind. 9 MR. SIANO: Not at all. 10 A. I didn't hide anything from the accountant. I told the 11 accountant everything, however, it is not the accountant that I 12 have now. This was an accountant that I no longer have. 13 Q. When did this accountant pass from your service, the one 14 that you have replaced him -- the one you replaced, when did he 15 leave your service? 16 A. It must have been, I would think, 2005, 2006 -- I don't 17 remember exactly. 18 Q. Sir, you replaced your old accountant with a new accountant 19 in 2006? 20 A. I don't remember the date exactly. I don't remember. 21 Q. Mr. Milio, tell us how you managed to hide the revenue from 22 your tax return in the years 2006, 2007 and 2008. How did you 23 do it? 24 A. I don't know. 25 Q. Well, you knew it was happening, isn't that right, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1520 C2TUANN5 A. Milio - cross 1 Mr. Milio? 2 THE COURT: Could I see counsel for a moment, please. 3 THE INTERPRETER: The answer was: "I knew that 4 something wasn't right." 5 6 (Continued on next page) 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1521 C2TUANN5 A. Milio - cross 1 (At the sidebar) 2 THE COURT: I am, of course, not particularly happy 3 with this charade that is going on. I am afraid that I am 4 going to have to admonish the translator not to be engaged in 5 conversation with the witness, to translate exactly the words 6 that he says and nothing more. I don't speak Italian, but I 7 know that the last time this happened, at least the translator 8 was speaking Urdu. 9 Now, I assume that the government supplied the 10 translator. 11 MR. HALPERIN: From the court agency, Judge. 12 THE COURT: I don't care who it is from. This is 13 ridiculous. 14 MR. HALPERIN: I respectfully disagree with the 15 characterization as a charade -- 16 THE COURT: He testified in the grand jury. 17 MR. HALPERIN: When he knew the questions in advance 18 and there was no cross-examination. 19 Italian is his first language and he is more 20 comfortable in Italian. 21 Secondly, if the Court wants to admonish the 22 translator -- 23 THE COURT: I have no choice but to do it. 24 MR. ARONWALD: I am quite certain, even though I 25 wasn't there, but when the government met with them in their SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1522 C2TUANN5 A. Milio - cross 1 office, there was not an interpreter present. 2 And I am sure that Judge Briccetti, who I know very 3 well, if he had any doubt in his mind that this witness was not 4 fully able to understand and comprehend English, he would have 5 insisted that there be an interpreter there rather than letting 6 the witness make that decision. 7 MR. HALPERIN: At the plea allocution -- you weren't 8 there, Mr. Aronwald, and you didn't hear Judge Briccetti go 9 through the allocution where he said that his son and his 10 counsel read the plea agreement to him and explained it and he 11 had a great deal of difficulty with it. 12 THE COURT: I understand the issue is Judge Briccetti, 13 who was not speaking Italian at the time -- 14 MR. HALPERIN: It was -- 15 THE COURT: All I want to do, I don't want to sandbag 16 anybody. I want to let you know right here with the jury 17 sitting here, I have to talk to the interpreter. 18 MR. HALPERIN: That's fine. 19 MR. ARONWALD: Thank you, Judge. 20 21 (Continued on next page) 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1523 C2TUANN5 A. Milio - cross 1 (In open court) 2 THE COURT: I need to speak for a moment to the 3 interpreter. 4 Please do not have any conversation with the witness. 5 Translate exactly the words the lawyer says and exactly the 6 words that the witness says and do not say any other words 7 aloud. 8 Mr. Siano, you may continue. 9 MR. SIANO: Thank you, your Honor. 10 BY MR. SIANO: 11 Q. Mr. Milio, the scheme to not report all the income and 12 revenue from Milio Management was going on before your son 13 Franco joined the business, isn't that right? 14 A. Yes. 15 Q. Did you know how the scheme worked then? 16 A. Not really. 17 Q. Well, who ran the scheme, Mr. Milio? 18 A. The people paid the rent. 19 THE INTERPRETER: I am sorry. I have to ask him to 20 repeat the last part. 21 THE COURT: That's fine. 22 A. And I paid people. 23 Q. So you collected the rent, is that correct? 24 A. Yes. 25 Q. And you paid your workers in cash? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1524 C2TUANN5 A. Milio - cross 1 A. Yes. 2 Q. And you paid yourself in cash? 3 A. Yes. 4 Q. And you paid other family members in cash? 5 A. Yes. 6 Q. And nobody told the accountant? 7 A. Yes. 8 Q. Now, you had a particular practice, did you not, sir, of 9 seeking out illegal aliens to work for Milio Management, is 10 that correct? 11 A. I didn't look for anyone. People that worked for me did. 12 THE INTERPRETER: Correction: 13 A. I didn't look for anyone. They came to me looking for 14 work. 15 Q. Initially, only two or three illegal aliens came looking 16 for work and were hired; is that what you told the FBI that at 17 first you had only a couple of illegal -- 18 THE COURT: I think it is fair to say, Mr. Siano, that 19 if you speak in relatively short phrases and we let the 20 translator translate, we will not run into the problems that I 21 at least am perceiving. 22 MR. SIANO: Thank you, Judge, and I will do my best. 23 BY MR. SIANO: 24 Q. You started out with a couple of illegal aliens, is that 25 correct? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1525 C2TUANN5 A. Milio - cross 1 A. I surely don't remember exactly how many but, yes, when I 2 began, a few. 3 Q. And when you started to talk to the FBI -- strike that. 4 When you started to cooperate with the government, you 5 told them that you somewhere between 20 and 25 illegal aliens 6 working for you, is that right? 7 A. That's correct. 8 Q. Now, the first time the FBI came to visit you was in 2007, 9 I believe, is that correct? 10 A. It seems to me, yes. 11 Q. And the first time they came to talk to you, you weren't so 12 anxious to help them, were you, sir? 13 A. Yes. 14 Q. In fact, you lied to the agents, isn't that right? 15 A. Yes. 16 Q. And then there came a point in time where you decided you 17 wanted to cooperate with the government, isn't that right? 18 A. Yes. 19 Q. Now, you told the government that from time to time, 20 starting in the 1990s, you have given various public employees 21 in Yonkers cash, isn't that right? 22 A. Yes. 23 Q. And you paid cash to the plumbing inspector in the city of 24 Yonkers? 25 A. It was a tip. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1526 C2TUANN5 A. Milio - cross 1 Q. It was money, wasn't it? 2 A. Yes. 3 Q. And it was more than once a year? 4 A. I don't recall. 5 Q. Well, you recall you told the government you gave him one 6 amount of money at Christmastime, is that correct? 7 A. Yes. 8 Q. And you gave him other amounts of money when he came to 9 visit you, is that correct? 10 MR. HALPERIN: Objection to "him." Clarification. 11 THE COURT: Are we talking about the plumbing 12 inspector? 13 MR. SIANO: There is only one in Yonkers. 14 THE COURT: But that is who we are talking about, the 15 plumbing inspector? 16 MR. SIANO: The plumbing inspector that the federal 17 government, I believe indicted, or the state of New York 18 indicted and -- 19 THE COURT: Basta, basta, basta. 20 I have very little Italian but I can employ that word. 21 BY MR. SIANO: 22 Q. The plumbing inspector in the city of Yonkers, him? 23 A. That's possible. 24 Q. It is possible? Was that your answer, sir? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1527 C2TUANN5 A. Milio - cross 1 Q. And you paid the building inspector cash as well? 2 A. Just tips. 3 Q. Again, it was cash, isn't that correct? 4 A. Yes. 5 Q. And it was one amount of money at Christmastime, is that 6 correct? 7 A. Yes. 8 Q. And a different amount of money when he came to visit you? 9 MR. HALPERIN: Objection to "he." Who are we talking 10 about? 11 A. Not really no. 12 MR. SIANO: I got in trouble the last time I mentioned 13 him by name. 14 THE COURT: Not quite. 15 I am personally not having any difficulty following 16 this, Mr. Halperin. We moved from the plumbing inspector to 17 the building inspector. 18 BY MR. SIANO: 19 Q. Isn't that right, Mr. Milio, you paid him a different 20 amount of money when he came to visit you from time to time? 21 A. I don't recall, but I don't think so. 22 Q. The gentleman that we are talking about, he is the 23 gentleman that recommended Anthony Mangone to you and your son, 24 isn't that right? 25 A. I never paid a single sou to him. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1528 C2TUANN5 A. Milio - cross 1 Q. Are you saying that Mr. Joe Guarniero is not a building 2 inspector? 3 A. He is an inspector but I never gave him a sou. 4 Q. You gave another building inspector the tips? 5 A. I don't recall, but when it is Christmastime you give tips 6 to a number of people. 7 Q. Was it your pattern or practice, sir, to give every public 8 employee in the city of Yonkers a Christmas present? 9 MR. HALPERIN: Objection. 10 THE COURT: The objection is sustained. 11 Q. You gave tips to the inspectors that you saw in connection 12 with Milio Management, isn't that right, Mr. Milio? 13 A. I don't recall. At Christmastime you send things. 14 Sometimes you send cookies or something else. Sometimes there 15 are tips, but I remember practically nothing with respect to 16 inspectors. 17 Q. Nevertheless, you told the FBI about this, isn't that 18 correct, Mr. Milio? 19 A. Yes. It is possible. I mentioned it, but I have no 20 recollection of giving money. 21 Q. You have no recollection of giving them money? 22 A. No. 23 Q. Let's talk about $5,000 campaign contributions. Do you 24 recall telling the FBI that you gave politicians $5,000 25 campaign contributions? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1529 C2TUANN5 A. Milio - cross 1 A. Yes, I do. 2 Q. Those were in cash? 3 A. No. Checks. 4 Q. How many times did you give $5,000 campaign contributions 5 by checks to politicians? 6 MR. HALPERIN: Objection. Relevance. 7 THE COURT: The objection is sustained. 8 MR. SIANO: Excuse me? 9 THE COURT: The objection is sustained. 10 BY MR. SIANO: 11 Q. Mr. Milio, I believe you testified on direct that you 12 recall giving Mr. Mangone a total of $40,000 at some time in 13 the year 2006, is that correct? 14 A. Yes. 15 Q. And I believe you testified that you fixed the approximate 16 time as being after you spoke to Franco? 17 A. Not a particular time but could have been a day or so 18 afterwards. 19 Q. Is it fair to say, sir, that you spoke to your son Franco 20 every day in the year 2006? 21 A. I speak to my son every single day. 22 Q. So when you tell us here that you gave the money to 23 Mr. Mangone a day or two after you spoke to Franco, is it any 24 particular day that you spoke to Franco that you recollect, 25 sir? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1530 C2TUANN5 A. Milio - cross 1 A. I think it was at the end of June or the beginning of July. 2 Q. And what do you base that recollection on, sir? 3 A. Because by mid August I was already on vacation in Italy. 4 Q. So it was sometime before you went on vacation? 5 A. That's correct. 6 Q. Can you fix the date in reference to anything else, sir? 7 A. I can still say just approximately the end of June and the 8 beginning of July -- or the beginning of July. 9 Q. You assembled this money after a conversation with your son 10 Franco, isn't that right? 11 A. Yes. 12 Q. You spoke to Franco and no one else about this subject? 13 A. Exactly. 14 Q. And Franco told you that Anthony Mangone said he needed 15 $30,000, isn't that correct? 16 A. Yes. 17 Q. And Franco told you that Anthony Mangone said, if you gave 18 Mr. Mangone $30,000, it would be a great help to moving the 19 Longfellow project forward? 20 MR. HALPERIN: Objection. Hearsay, what Franco said. 21 THE COURT: Overruled. 22 A. Yes. 23 Q. And you decided when Franco said that to you, you decided 24 to pay Mr. Mangone that money? 25 A. Yes, exactly. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1531 C2TUANN5 A. Milio - cross 1 Q. You decided to do that because you felt that Mr. DelBello 2 was not making progress on your project with the Yonkers city 3 council? 4 A. No. I didn't do it for that because I had already removed 5 him sometime before that. 6 Q. So it is your testimony that prior to end of June, 7 beginning of July 2006, you had gotten rid of Mr. DelBello? 8 A. No. 9 Q. I ask you again, sir, was Mr. DelBello still your lawyer at 10 the time you paid Mr. Mangone the $30,000 you say Franco asked 11 for? 12 A. Yes. 13 Q. But you thought that the progress of the project was not 14 making any progress, isn't that right? 15 A. That's correct. 16 Q. And Mr. Mangone told you -- excuse me -- Mr. Mangone told 17 Franco that if you gave Mr. Mangone $30,000, it would be a 18 great help to moving the project forward, isn't that right? 19 A. Yes. 20 Q. And that's when you decided to give Mr. Mangone the $30,000 21 after that conversation? 22 A. That's correct. 23 Q. You assembled the $30,000 in cash, isn't that right? 24 A. That's correct. 25 Q. But you also assembled an additional $10,000, making a SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1532 C2TUANN5 A. Milio - cross 1 total of 40? 2 A. Correct. 3 Q. Now, it would be fair to say that the money wasn't lying 4 around loose at the offices of Milio Management, was it, 5 Mr. Milio? 6 A. They were there because I knew that I had to pay my 7 employees -- 8 THE INTERPRETER: Rather it, was there, meaning the 9 money. 10 Sorry. 11 Q. Let's try this a different way. 12 Mr. Milio you went to Mr. Mangone's office with 13 40,000, isn't that right? 14 A. Yes. 15 Q. And it was four bundles of $10,000 in each bundle? 16 A. That's correct. 17 Q. And each bundle had 100 $100 bills? 18 A. Yes. 19 Q. Was your payroll in May and June of 2000 $40,000? 20 A. I don't recall. 21 Q. You had this money in the safe in rubber bands when Franco 22 told you Mangone was asking for $30,000, didn't you? 23 A. That's possible. 24 Q. And how did you get from your office to Mr. Mangone's 25 office with the $40,000? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1533 C2TUANN5 A. Milio - cross 1 A. I put it in my pocket and brought it to him. 2 Q. And you drove? 3 A. Yes. 4 Q. You put all four bundles in one pocket or were the bundles 5 in different pockets? 6 MR. HALPERIN: Objection. Relevance, Judge. 7 THE COURT: Objection sustained. 8 Q. When you got to Mr. Mangone's office, he came down to the 9 vestibule, is that right? 10 A. Yes. 11 Q. Tell me the conversation, please, sir. What did you say to 12 Mr. Mangone and what did he say to you? 13 A. First thing he said was: Hello. How are you? How is 14 everything going? 15 After that he took the money. 16 17 (Continued on next page) 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1534 C2tQann6 A. Milio - Cross 1 Q. He didn't ask for the money? 2 A. He already knew that when I got there was for that reason. 3 Q. How did he manifest to you that he already knew when you 4 got there that was the reason? 5 MR. HALPERIN: Objection. Hearsay as to what Mangone 6 said. 7 THE COURT: Overruled. 8 A. I said to him, I brought the money. I brought you the 9 $30,000. 10 Q. So you volunteered to him you had the $30,000? 11 A. Yes. 12 Q. And then you handed him four bundles or three bundles, 13 which was it? 14 A. At first I gave him three. 15 Q. Was there a continued discussion -- first of all, did he 16 say thank you? 17 A. Not really, I don't recall. 18 Q. You continued your conversation with Mr. Mangone at that 19 point, didn't you? 20 A. Yes. 21 Q. What was the conversation about? 22 A. When I gave him the $30,000, he said, "This will help us a 23 lot. She's going to go on vacation. She'll be very happy." 24 Q. Mr. Mangone did not say a proper name. He used the pronoun 25 "she," isn't that correct? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1535 C2tQann6 A. Milio - Cross 1 A. You're a hundred percent right. 2 Q. Nobody, nobody said the name Annabi to you, isn't that 3 right, Mr. Milio? 4 A. No. 5 Q. That is correct, is that not right, sir? 6 A. Yes. 7 Q. And the conversation continued there in the vestibule now 8 with $30,000 from you in Mr. Mangone's pocket. There was a 9 further discussion about money, wasn't there? 10 A. Yes, yes, we had to pay the retainer for four months. 11 Q. And the retainer, this is a writing that Mr. Mangone had 12 sent to Milio Management, isn't that correct? 13 A. I believe so. 14 Q. Well, isn't it a fact that he sent you two retainers. 15 First he sent you one for $3,000 a month, isn't that right? 16 A. I don't recall. 17 Q. Didn't you send back that first retainer saying he was too 18 expensive at $3,000 a month? 19 A. It's possible, but I don't recall. 20 Q. That's also possible. You got another retainer agreement 21 for $2,000 a month, isn't that right? 22 A. Yes. 23 Q. As of the time you were in the vestibule after you gave 24 Mr. Mangone the $30,000, you said you owed him four months 25 already and were giving him the fifth month as well, isn't that SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1536 C2tQann6 A. Milio - Cross 1 right? 2 A. Yes, exactly. 3 Q. And July was the fifth month? 4 A. Possibly, I don't remember. 5 Q. And this was a total of $40,000 in hundred dollar bills? 6 A. Yes. 7 MR. HALPERIN: Objection. Asked and answered. 8 THE COURT: The objection is sustained. 9 Q. Now, sir, I want to ask you a very specific question. Is 10 that the only time you gave bundles of hundreds to Mr. Mangone? 11 A. For myself, yes. 12 Q. Well, for Milio Management, sir. 13 A. I am almost a hundred percent sure, yes. 14 Q. Well, sir, was it the practice of your -- strike that. Let 15 me ask it a different way. Mr. Milio, you're the boss, isn't 16 that right? 17 A. Yes. 18 Q. You would be aware if a bundle of $10,000 disappeared out 19 of the offices of Milio Management, wouldn't you? 20 A. I would have no reason to suspect anything of the sort 21 because my children wouldn't do that. 22 Q. In fact, sir, do you recall being asked in the grand jury 23 why it was that you were paying Mr. Mangone the $30,000? Do 24 you recall specifically being asked about that by one of these 25 prosecutors in the year 2008? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1537 C2tQann6 A. Milio - Cross 1 A. He had told me that this would help me to become the 2 designated developer. 3 Q. Mr. Milio, if you will excuse me, the question I asked you 4 was, do you recall being asked in the grand jury about why it 5 was that you chose to pay Mr. Mangone the $30,000? Just do you 6 recall being asked questions about that subject? 7 A. I don't remember that exactly. 8 Q. Let me state for the record that I am placing in front of 9 the witness 3519B. 10 Mr. Milio -- excuse me. Please look at the first few 11 pages of that exhibit so that I may ask you if you recall it 12 being your testimony, sir. 13 THE INTERPRETER: OK, now do we want this translated? 14 Q. Do you recall being in the grand jury on September 18, 15 2008? 16 A. Yes. 17 Q. Do you recall being asked questions by one of the 18 prosecutors that day? 19 A. Yes. 20 Q. Do you recall the questions were asked of you in English, 21 and you responded in English? 22 A. Yes, I do. 23 Q. And I would now ask you, sir, either directly or with the 24 use of the interpreter to please read page 10 from line 19 on 25 through to the next page through page 11/line 10. I am going SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1538 C2tQann6 A. Milio - Cross 1 to ask you some questions. 2 THE INTERPRETER: OK. 3 Q. Now, do you recall, sir, having had the opportunity to read 4 pages 10 and 11 of your grand jury appearance of September 19, 5 2008, do you recall being asked those questions and giving 6 those answers? 7 A. Yes, more or less. 8 MR. HALPERIN: Objection, Judge. Could we have a page 9 and line number? 10 MR. SIANO: Page 10/lines 22 through page 11/line 10. 11 Q. Mr. Milio, do you recall being asked about the 12 decision-making process you made at the time Franco told you 13 what Mr. Mangone was asking for? Do you recall being asked 14 about that subject matter in the grand jury now that I've given 15 you those pages to read? 16 A. Yes. 17 Q. And you told the grand jury, did you not, sir, that it was 18 your choice and you felt it was your only alternative, isn't 19 that right? 20 A. Yes, that's exactly what I did think. 21 Q. And when they asked you why you thought it was the only 22 alternative, you said because this project was taking a very 23 long time? 24 MR. HALPERIN: Judge, we'd ask the question and answer 25 to be read. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1539 C2tQann6 A. Milio - Cross 1 THE COURT: Question and answer. 2 Q. Do you recall being asked the following questions and 3 giving the following answers: Page 11/line 3. 4 MR. HALPERIN: For completeness, Judge, we'd ask -- 5 THE COURT: No completeness. Completeness on 6 redirect. 7 MR. HALPERIN: OK. 8 BY MR. SIANO: 9 Q. "Q. This was the only alternative you felt like you had? 10 "A. Yes." 11 MR. SIANO: Your Honor, because of the translation, I 12 want to go one question at a time. 13 THE COURT: I think that's an excellent idea. 14 MR. SIANO: I'm a slow learner, but I try to hold what 15 I learn, Judge. 16 THE COURT: Ma'am, would you please read that question 17 and answer to the witness? 18 THE INTERPRETER: OK. 19 THE COURT: Sir, were you asked that question in the 20 grand jury, and did you give that answer? 21 THE WITNESS: Yes. 22 Q. And do you recall being asked the next question and answer: 23 "Q. Why is that? 24 "A. Because I wasn't -- this project was taking a very long 25 time." SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1540 C2tQann6 A. Milio - Cross 1 Do you recall being asked that question and giving 2 that answer? 3 A. Yes. 4 Q. Do you recall being asked the next question: 5 "Q. And you spent a lot of money on this project? 6 "A. Yes, I did." 7 A. Yes. 8 Q. And were those answers true to the best of your knowledge 9 when you gave them in September of 2008, sir? 10 A. Yes. 11 Q. Thank you, Mr. Milio. 12 Mr. Milio, in your plea agreement, which is 13 Defendant's Exhibit 48 in evidence, I want to direct your 14 attention back to the second page, and in the second paragraph, 15 I would like the interpreter to please read to Mr. Milio 16 subparagraph five, and then I'm going to ask Mr. Milio some 17 questions. 18 THE INTERPRETER: I'm not getting a subparagraph five. 19 I'm getting a number five. 20 MR. SIANO: Number five, thank you. 21 THE INTERPRETER: You're welcome. 22 (Pause) 23 A. Yes. 24 Q. Mr. Milio, did you have the opportunity to listen to the 25 interpreter read you that section? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1541 C2tQann6 A. Milio - Cross 1 A. Are you talking about when I was in White Plains? 2 Q. I'm talking about the letter, and in the letter -- strike 3 it, your Honor. Let me try it another way. 4 Mr. Milio, if I might try this another way. From time 5 to time, you on behalf of Milio Management purchased parcels of 6 real property from various sellers, isn't that correct? 7 A. Yes. 8 Q. In the process of doing that, would it be fair to say that 9 you on behalf of Milio Management and some person on behalf of 10 the seller agreed on a price? 11 A. Yes. 12 Q. And it would be fair to say that you told the government in 13 as many as six of these transactions you paid the seller cash 14 money under the table? 15 MR. HALPERIN: Objection. Asked and answered. 16 THE COURT: The objection is sustained. 17 Q. I want to talk about the largest of these transactions, 18 sir. 19 MR. HALPERIN: Objection. 20 THE COURT: He hasn't asked his question yet, so 21 before you say it's not relevant, Mr. Halperin, could I hear 22 the question? 23 Q. The largest of these transactions involve a cash payment of 24 $300,000, isn't that right? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1542 C2tQann6 A. Milio - Cross 1 Q. How was that $300,000 paid? 2 A. In cash. 3 Q. Cash. Now, was that $10,000 bundles of hundred dollar 4 bills? 5 MR. HALPERIN: Objection. Relevance. 6 A. I don't recall exactly. 7 Q. Now, when you did that, the $300,000 was left off the 8 contract, isn't that right? 9 MR. HALPERIN: Objection. Asked and answered. 10 THE COURT: Overruled. 11 A. Yes. 12 Q. You and the seller didn't tell the lawyers what was 13 happening, did you? 14 A. That's right. 15 Q. And you and the seller deceived the real estate agent about 16 the real price, didn't you? 17 A. Yes. 18 Q. In what location was the parcel of real property where you 19 understated the actual purchase price by $300,000? 20 A. I don't recall. I don't recall. 21 Q. When that transaction took place, sir, you knew that a 22 transaction in real property in the State of New York involved 23 the payment of taxes, isn't that right? 24 A. Yes. 25 Q. And you did it anyway? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1543 C2tQann6 A. Milio - Cross 1 A. Yes. 2 Q. You knew that understating the price was going to cheat the 3 real estate agents, isn't that right? 4 A. I say yes. 5 Q. You and the seller all by yourselves agreed that this would 6 be good business for the two of you, didn't you? 7 A. That's true. 8 Q. And that's the reason why you did it, isn't it, sir? 9 A. That's correct. 10 MR. SIANO: No further questions. 11 THE COURT: Mr. Aronwald? 12 MR. ARONWALD: Yes, your Honor. 13 CROSS-EXAMINATION 14 BY MR. ARONWALD: 15 Q. Good afternoon, Mr. Milio. 16 A. Good afternoon, sir. 17 Q. I'm Mr. Aronwald. I represent Sandy Annabi. 18 A. Nice to meet you. 19 Q. Now, Mr. Milio, did you ever have any discussions with 20 Sandy Annabi concerning giving her money to have her vote to 21 designate you the developer of Longfellow? 22 A. Never. 23 Q. You say that you gave $30,000 in cash to Anthony Mangone, 24 correct? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1544 C2tQann6 A. Milio - Cross 1 Q. By the way, when you spoke to Mr. Mangone, did you speak to 2 him in English or in Italian? 3 A. I think in English. 4 Q. By the way, when you gave Mr. Mangone the money, there was 5 no one else present, correct? 6 A. No, there wasn't. 7 Q. And you have no idea what Mr. Mangone did with the $30,000 8 once you gave it to him, correct? 9 A. I have no idea. 10 Q. For all you know, he could have used the $30,000 for his 11 own personal needs, correct? 12 MR. HALPERIN: Objection. He said he had no idea. 13 THE COURT: The objection is sustained. 14 Q. By the way, on how many separate occasions were you 15 interviewed by agents of the FBI? 16 A. Don't recall. 17 Q. More than five? 18 A. I don't recall. 19 Q. You have no recollection as to whether it was more than 20 five? 21 A. I don't recall. 22 Q. Do you recall the names of the agents you met with? 23 MR. HALPERIN: Objection. Relevance. 24 THE COURT: Objection is overruled. 25 A. Agent Mazzuca. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1545 C2tQann6 A. Milio - Cross 1 Q. Do you see Agent Mazzuca in the courtroom today? 2 A. No, I don't. 3 Q. Do you recall also being interviewed by an agent by the 4 name of Caroline Gilmore? 5 A. There was a woman there. However, I don't remember her 6 name. 7 Q. Do you recall that you were also interviewed by a second 8 female FBI agent as well? 9 MR. HALPERIN: Objection. Relevance. 10 THE COURT: Overruled. 11 THE INTERPRETER: Is it overruled, your Honor? 12 THE COURT: It's overruled at the moment. I want to 13 see where it's going. 14 A. No. 15 Q. Whenever you met with the agents from the FBI, you spoke to 16 them in English, isn't that so? 17 A. Yes. 18 Q. On how many occasions did you meet with Assistant United 19 States Attorney Perry Carbone or Jason Halperin concerning this 20 case? 21 A. I don't recall. 22 Q. More than five? 23 A. Possibly. 24 Q. When you spoke to them, you spoke to each of them in 25 English as well, correct? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1546 C2tQann6 A. Milio - Cross 1 A. Yes. 2 Q. There was no interpreter present from the U.S. Attorney's 3 office when you met with the Assistant United States Attorneys, 4 correct? 5 A. That's correct. 6 MR. ARONWALD: May I just have one moment, your Honor, 7 please? 8 (Pause) 9 Q. Mr. Milio, do you recall -- didn't you tell the FBI agents 10 that you believe that the payment of the $30,000 to Mr. Mangone 11 was made either in July or August of 2006? 12 A. I could have except that from the beginning to middle of 13 August I was on vacation, and what I recall is the end of June, 14 beginning of July. 15 Q. Well, you said -- you just got through telling us that you 16 were on vacation at the end of August? 17 A. In the beginning of August. 18 Q. Beginning of August. So you believe that you gave the 19 payment to Mr. Mangone in June or July of 2006? 20 A. Around either the end of June or the beginning of July, I 21 don't know which. 22 Q. Mr. Milio, isn't it a fact that when you met with the FBI 23 agents between March 11 of 2008 and June 13 of 2008, you told 24 them -- strike that. Isn't it true that on March 11 and on 25 June 13 of 2008 when you met with the FBI agents, you did tell SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1547 C2tQann6 A. Milio - Cross 1 them that you believe the payment was made either in July or 2 August of 2006? Didn't you tell them that? 3 MR. HALPERIN: Objection. Asked and answered. 4 THE COURT: Objection sustained. 5 Q. Mr. Milio, with respect to the various cash transactions 6 that Mr. Siano has been speaking with you about, I want to ask 7 you some questions about that handgun. You -- 8 MR. HALPERIN: Objection. Asked and answered. 9 THE COURT: He hasn't asked a question yet. 10 MR. HALPERIN: Mr. Siano had a long series of 11 questions. 12 THE COURT: Guess what? He represents somebody else. 13 If he asks a lot of questions that were asked previously, I'll 14 stop it, but, you know, Ms. Annabi has her own interest in this 15 case. 16 All right. Ask your question. 17 MR. ARONWALD: Thank you, your Honor. 18 Q. You testified that you began cooperating with the 19 government in 2007, correct? 20 A. I don't recall exactly. I don't recall. 21 Q. When you met with the government to begin your cooperation, 22 you were told that you had to disclose all previous criminal 23 acts that you were engaged in, correct? 24 A. Yes. 25 Q. And you didn't tell the government that you had that SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1548 C2tQann6 A. Milio - Cross 1 illegal handgun until October 30 of 2009, isn't that correct? 2 A. I didn't recall that because I had never used it, and I had 3 forgotten all about it in the safe. 4 Q. That's the same safe you kept those bundles of hundred 5 dollar bills in? 6 A. Sometimes, yes. Maybe it was the same one. 7 Q. How many safes did you have in your house, Mr. Milio? 8 A. One. And there was one in the office. 9 Q. Well, did you keep the cash in both your home safe and the 10 office safe? 11 A. At that time, yes. 12 Q. You're telling the jury that you just forgot that there was 13 a handgun with 131 bullets and two magazines in your safe? 14 MR. HALPERIN: Objection. 15 THE COURT: Ground? 16 MR. HALPERIN: Repetitive. Cumulative. 17 THE COURT: Overruled. 18 A. I forgot about it because I'd never used it. I never 19 touched it. 20 Q. Then why did you have it? 21 A. In case there was ever a need for me to protect myself or 22 my family. 23 Q. Well, did you take the gun with you when you went to 24 Mr. Mangone's office with $40,000 in cash? 25 MR. HALPERIN: Objection. Argumentative. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1549 C2tQann6 A. Milio - Cross 1 THE COURT: The objection is sustained. 2 Q. Did you take the gun with you when you went to 3 Mr. Mangone's office? 4 MR. HALPERIN: Objection. 5 THE COURT: The objection is sustained. 6 Q. Were you aware at that time that you had the gun that it 7 was against the law to possess a gun without a license? 8 A. Yes. 9 Q. But you possessed it anyway? 10 A. It had been a gift. 11 Q. And the person that gave you the gift was a friend by the 12 name of Adolfo? 13 MR. HALPERIN: Objection. Asked and answered. 14 THE COURT: The objection is sustained. 15 Q. Didn't you tell the government that Adolfo was "a good 16 friend"? 17 MR. HALPERIN: Objection. Asked and answered. 18 MR. ARONWALD: I'd ask that your Honor allow me one 19 other question, please. 20 THE COURT: OK, Mr. Aronwald. One more. Did you tell 21 the government that Adolfo was a good friend? 22 THE WITNESS: Yes. 23 Q. But you told the government that you couldn't remember this 24 good friend's last name, correct? 25 A. That's very true. The truth is that I only know him by his SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1550 C2tQann6 A. Milio - Cross 1 first name. 2 Q. But didn't you also tell the government at the same time in 3 October of -- on October 30 of 2009 that you did not want to 4 get anyone in trouble? 5 A. That's possible. I don't recall, but it's possible. 6 Q. Let me show you what's been marked as 3519-K. Mr. Milio, 7 would you please read -- would the interpreter please read this 8 to him and I'm particularly interested in this sentence that 9 I'm pointing out to you. 10 (Pause) 11 Q. Does that refresh your recollection that when you were 12 interviewed on October 30, 2009 you told the FBI agents that 13 you did not want to get anyone in trouble? 14 A. That could be, but I don't recall having said it. 15 Q. Mr. Milio, was it your understanding that as part of your 16 agreement with the government, that they would not disclose or 17 tell the Westchester County District Attorney that you had 18 illegally possessed a loaded handgun or a handgun with the 19 bullets for it while you were a resident of Westchester County? 20 A. I don't recall that well. They did ask me at that time if 21 I had a pistol, and I said yes because up to that point I had 22 not remembered. 23 Q. My question to you is, as part of your agreement with the 24 government, is it your understanding that they will not tell 25 the Westchester County District Attorney that you had illegally SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1551 C2tQann6 A. Milio - Cross 1 possessed a handgun in violation of New York State law? 2 MR. HALPERIN: Objection. Good faith basis, Judge. 3 THE COURT: The objection is overruled. 4 A. They didn't promise me anything. 5 Q. Mr. Milio, isn't it a fact that you have not been charged 6 or prosecuted by the Westchester County District Attorney's 7 office with the illegal possession of a handgun that you turned 8 over to the government in October -- in 2009? 9 MR. HALPERIN: Objection. Asked and answered by 10 Mr. Siano. 11 THE COURT: It's been asked and answered. 12 MR. ARONWALD: Judge, it wasn't asked about state 13 prosecution. That's what this question directs to. 14 THE COURT: All right. Translate the question for him 15 and get the answer, and then we're going to quit for the day. 16 A. I haven't understood your question. 17 Q. Have you been prosecuted -- have you been prosecuted by the 18 Westchester County District Attorney for the illegal possession 19 of that handgun? 20 A. No. 21 MR. ARONWALD: Your Honor, this would be a good time 22 to break. I am going to move on to another area. 23 THE COURT: Yes, it is indeed. 24 OK. See you in the morning. Now, tomorrow we are 25 going to follow a little bit of a different timetable. And SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1552 C2tQann6 A. Milio - Cross 1 this is actually going to happen three times in the next week, 2 for which I apologize, but tomorrow I have to go up town late 3 in the afternoon to attend the memorial service at the 4 Versaille Church for the late Judge Robert Carter. 5 Judge Carter was a member of this court for many 6 years. He is a giant of the law of the 20th Century. I don't 7 know if any of you know this, but he, along with Thurgood 8 Marshall and Constance Baker Motley were the people who planned 9 and executed the whole litigation strategy that led to the 10 Brown v. Board of Education and the great civil rights lawsuits 11 of the 1940s, 50s and early 60s, and then he joined this court 12 where he was a very esteemed judge, and actually the judge 13 before whom I had my first federal trial back in 1978. 14 So, there is going to be a memorial service for him 15 tomorrow afternoon, and I really, really, really need to go to 16 that. 17 So, what we are going to do is we are going to start 18 at 9:30 as soon as we are all here, and hopefully we will all 19 be here. We are going to order you lunch. We will take a 20 lunch break a little early, and you will eat in tomorrow. We 21 will take about a 45 minute lunch break, and we will get done 22 between 3:15 and 3:30 tomorrow. Don't discuss the case night. 23 Keep an open mind. Lock those notebooks in the jury room. 24 I'll see you in the morning. 25 (Jury recessed) SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1553 C2tQann6 A. Milio - Cross 1 (Jury not present) 2 THE COURT: Mr. Siano shall I punish the witness in 3 English or Italian? 4 MR. SIANO: I think English will do. 5 MR. ARONWALD: But on the same side, perhaps it should 6 be done in Italian, your Honor, through the interpreter. 7 THE COURT: Mr. Milio, please don't talk to the 8 prosecutors or the agents tonight. 9 (Witness excused) 10 THE COURT: I just want to be completely fair to the 11 government because I think I should always be completely fair 12 to everybody. Judge Briccetti does indeed confirm that there 13 was some difficulty with the witness's speaking abilities at 14 the plea allocution, so... 15 MR. HALPERIN: Thank you Judge. 16 (Trial adjourned to March 1, 2012 at 9:00 a.m.) 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1554 1 INDEX OF EXAMINATION 2 Examination of: Page 3 FRANCO MILIO 4 Cross By Mr. Aronwald ...... 1394 5 Cross By Mr. Siano ...... 1427 6 Redirect By Mr. Halperin ...... 1432 7 Recross By Mr. Aronwald ...... 1442 8 Recross By Mr. Siano ...... 1446 9 DEBBIE KAYAL 10 Direct By Mr. Carbone ...... 1450 11 ANTONIO MILIO 12 Direct By Mr. Halperin ...... 1460 13 Cross By Mr. Siano ...... 1475 14 DEBBIE KAYAL 15 Cross By Mr. Aronwald ...... 1485 16 Redirect By Mr. Carbone ...... 1496 17 Recross By Mr. Aronwald ...... 1501 18 RASHAD BLANCHARD 19 Direct By Mr. Halperin ...... 1502 20 ANTONIO MILIO 21 Cross By Mr. Siano ...... 1507 22 Cross By Mr. Aronwald ...... 1543 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1555 1 GOVERNMENT EXHIBITS 2 Exhibit No. Received 3 Page 56 and 57 grand jury testimony . . . .1499 4 450, 451, 452, 453A through H, 454, . . . . .1506 5 455, 456, 457, 458, 458A, 459, 6 460, 461, 462, 463, 464 7 through 467, 471 and 471A 8 DEFENDANT EXHIBITS 9 Exhibit No. Received 10 45 ...... 1398 11 46 ...... 1401 12 48 ...... 1507 13 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1556 C31Qann1 Trial 1 UNITED STATES DISTRICT COURT 1 SOUTHERN DISTRICT OF NEW YORK 2 ------x 2 3 UNITED STATES OF AMERICA, 3 4 v. 10 CR 007 (CM) 4 5 SANDY ANNABI and ZEHY JEREIS, 5 6 Defendant. 6 7 ------x 7 8 New York, N.Y. 8 March 1, 2012 9 10:00 A.M. 9 10 10 11 11 Before: 12 12 HON. COLLEEN MCMAHON, 13 13 District Judge 14 14 15 APPEARANCES 15 16 PREET BHARARA 16 United States Attorney for the 17 Southern District of New York 17 JASON P.W. HALPERIN 18 PERRY A. CARBONE 18 Assistant United States Attorneys 19 19 WILLIAM I. ARONWALD 20 Attorney for Defendant ANNABI 20 21 ANTHONY J. SIANO 21 JEANNIE GALLEGO 22 Attorneys for Defendant JEREIS 23 ALSO PRESENT 24 Joanna Dezio - Italian Interpreter 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1557 C31Qann1 Trial 1 (In open court; jury not present) 2 THE DEPUTY CLERK: Case on for trial continued. 3 Government and defendants are present. The jurors are in the 4 jury room. A couple of matters, your Honor. 5 THE COURT: Where is the witness? 6 THE DEPUTY CLERK: Coming. 7 MR. ARONWALD: Your Honor, may I make a very brief 8 application? I've discussed this with the government. 9 THE COURT: Yes, Mr. Aronwald. 10 MR. ARONWALD: As a condition of Ms. Annabi's bail, 11 she was required to surrender her passport. It's in the 12 custody of pretrial services. We'd like to have the passport 13 released. It could be released to the custody of the U.S. 14 Attorney as far as we are concerned, just so that it's 15 available. There has been some discussion about the trip to 16 Jordan, and we'd like to have a passport available in the event 17 we need it. 18 MR. HALPERIN: We certainly have no objection. We'll 19 contact pretrial later today. 20 THE COURT: Fine, I will have Mr. O'Neill call them 21 too. 22 MR. ARONWALD: Thank you, your Honor. 23 MR. HALPERIN: Judge, we have one other matter. 24 THE COURT: Everyone can sit down. Meaning no 25 disrespect to Mr. Halperin, but it's not necessary to stand. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1558 C31Qann1 Trial 1 MR. HALPERIN: Your Honor, yesterday Mr. Siano was 2 cross-examining Mr. Milio about the tips and gifts. 3 THE COURT: Which Mr. Milio? 4 MR. HALPERIN: Antonio Milio. And of course we have 5 no objection to that general line of questioning. That's 6 obviously fair game, but then -- 7 THE COURT: I would say so. 8 MR. HALPERIN: Absolutely. But then Mr. Sham said at 9 page 1526 when he was talking about the plumbing inspector. 10 "The plumbing inspector that the federal government I believe 11 indicted or the State of New York indicted," and before we 12 could even stand up, of course, the Court quite properly 13 sua sponte sustained the objection. 14 THE COURT: Thank you. Thank you so much. I 15 appreciate the compliment this early in the morning. 16 MR. HALPERIN: The Court actually had a funny line 17 "basta, basta, basta." That type of cross is completely 18 improper. It's being done solely and improperly to tar the 19 witness with guilt by association, and if the government did 20 that type of thing to the defendant on cross or defense 21 witness, the Court would quite properly come down on us like a 22 ton of bricks. So we would ask the Court to admonish counsel 23 not to make gratuitous comments or go into improper lines of 24 cross-examination. 25 THE COURT: Are you duly chastised, Mr. Siano? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1559 C31Qann1 Trial 1 MR. SIANO: Quite, your Honor. 2 THE COURT: It was not proper at all. 3 MR. HALPERIN: Thank you, your Honor. 4 THE COURT: Witness and a translator. 5 (Continued on next page) 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1560 C31Qann1 Trial 1 (Jury present) 2 THE COURT: Good morning, everybody. 3 THE JURY: Good morning. 4 THE COURT: We resume with Mr. Milio. You are still 5 under oath. 6 Good morning, Mr. Aronwald. 7 (Joanna Dezio, Italian interpreter) 8 ANTONIO MILIO, resumed. 9 CROSS-EXAMINATION 10 BY MR. ARONWALD: 11 Q. Good morning, your Honor. Good morning, Mr. Milio. 12 A. Good morning. 13 Q. Mr. Milio, are you familiar with the term money laundering? 14 A. I've heard that, yes. 15 Q. In fact, Mr. Milio, it's true, is it not, that you also 16 engaged in money laundering, didn't you? 17 MR. HALPERIN: Objection. 18 THE COURT: Ground? 19 MR. HALPERIN: Relevance. 20 THE COURT: Overruled. 21 A. That could be possible. 22 Q. Well, do you know an individual by the name of Tony 23 Ricciardi, R-I-C-C-I-A-R-D-I? 24 A. Yes. 25 Q. It's true, is it not, that on several occasions SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1561 C31Qann1 A. Milio - Cross 1 Mr. Ricciardi gave -- you gave cash to Mr. Ricciardi in 2 exchange for a check from him in the same amount, isn't that 3 true? 4 A. Yes. 5 Q. And that was because Mr. Ricciardi had a need for cash, 6 correct? 7 A. I was the one who needed the check. 8 Q. Yes. And Mr. Ricciardi gave you cash, a hundred thousand 9 dollars in cash, correct? So you gave Mr. Ricciardi a hundred 10 thousand dollars in cash and he gave you in return a check in 11 the same amount, correct? 12 A. Yes, that's true. 13 Q. That was because you needed the check in order to pay down 14 a home equity loan that you had outstanding, correct? 15 A. Yes, that's it. 16 Q. And you used the check that you received from 17 Mr. Ricciardi to pay down that home equity loan, correct? 18 A. Yes. 19 Q. The reason you needed a check was because you would be 20 unable to explain where the cash came from if you used the cash 21 to pay down the loan, correct? 22 A. That's true. 23 Q. And you did that on more than one occasion, correct? 24 A. Yes. 25 MR. HALPERIN: Your Honor, can we please approach? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1562 C31Qann1 A. Milio - Cross 1 It's important briefly. 2 (At the sidebar) 3 THE COURT: Yes, Mr. Halperin. 4 MR. HALPERIN: I have no problem with counsel's 5 questions about the conduct, but it is absolutely unfair and 6 improper to characterize it as money laundering. The jury is 7 going to get confused. This was not money laundering. This 8 was part of his unlawful tax scheme using lots of cash. He has 9 no idea what the elements of money laundering are, and as far 10 as he's concerned, he didn't engage in money laundering. 11 THE COURT: Believe me, I'm not going to instruct the 12 jury on money laundering, and I really don't care how defense 13 counsel characterizes this. OK. 14 MR. ARONWALD: Thank you, your Honor. 15 (Continued on next page) 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1563 C31Qann1 A. Milio - Cross 1 (In open court) 2 BY MR. ARONWALD: 3 Q. By the way, you exchanged checks for cash on other 4 occasions with other individuals too, didn't you? 5 A. No. 6 Q. With respect to Anthony Mangone, Anthony Mangone was your 7 attorney with respect to a number of matters that Milio 8 Management was involved in, correct? 9 A. Yes. 10 Q. Was Mr. Mangone a client or customer of Milio Management or 11 any of its related companies? 12 A. He was my lawyer. 13 Q. He was your lawyer, but was he a customer or client of 14 yours or your company's? 15 A. He was not a customer or client. He represented me. He 16 was just my lawyer. 17 Q. Did Mr. Mangone ever give you a check in the amount of -- 18 strike it. Did Mr. Mangone ever give Milio Management a check 19 in the amount of $182,760 payable to cash? 20 A. No. 21 Q. Did Anthony Mangone on March 27, 2008 issue a check to cash 22 in the amount of $220,500 and give that check to Milio 23 Management or to you? 24 MR. HALPERIN: Objection. Relevance. 25 THE COURT: Overruled. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1564 C31Qann1 A. Milio - Cross 1 Q. In fact -- on March 27, 2008 -- 2 THE COURT: We haven't had an answer to the question. 3 I overruled the objection. 4 MR. ARONWALD: I'm sorry, Judge. 5 (Question read back by interpreter) 6 A. No. 7 Q. Are you familiar with a company HP Capital LLC? 8 A. I don't know that. 9 Q. Are you familiar with a company HP Realtors? 10 A. No. 11 MR. ARONWALD: May I have a moment, your Honor? 12 THE COURT: You may. 13 (Pause) 14 Q. Mr. Milio, I want to show you what has been marked as 15 Defendant's Exhibit 49 for identification, and I want to direct 16 your attention to -- it's a two-page exhibit. I want to direct 17 your attention to these three items. Would you please take a 18 look at those. 19 A. I don't -- 20 Q. There is no question. I just wanted him to look at those. 21 Have you looked at them? 22 A. This one for $220,500? I can't see the amount. 23 Q. On this one the amount is $220,500. 24 A. This one is $182,000? 25 Q. This item is $182,760. The one below it is $220,500 and SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1565 C31Qann1 A. Milio - Cross 1 the one over here is for $21,072. 2 MR. HALPERIN: Objection, Judge, to the amounts being 3 read aloud. 4 THE COURT: Please. 5 A. I have understood. 6 Q. Do you know what these checks represent? 7 A. No. 8 Q. Thank you. 9 A. I don't know. 10 Q. Now, you don't know who Zehy Jereis is, do you? 11 A. No. 12 Q. And Mr. Jereis -- stand up, please -- this gentleman, you 13 never spoke to him, did you? 14 A. No. 15 Q. And any meetings that you had, he was never at any of those 16 meetings, was he? 17 A. No. 18 Q. And in any meetings or discussions that you had with 19 Anthony Mangone, Sandy Annabi was not present either, was she? 20 A. No. 21 Q. Now, when you initially appeared before the city council to 22 be designated the developer for Longfellow, it was defeated by 23 a vote of four to three, isn't that so? 24 A. Yes. 25 Q. At the time you only needed four members of the city SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1566 C31Qann1 A. Milio - Cross 1 council to designate you the developer, correct? 2 A. That's correct. 3 Q. By the way, because I didn't tell you this yesterday, and I 4 apologize, when I say you, I'm referring to either you or Milio 5 Management. 6 A. OK. 7 Q. Now, the four people, the four people who voted no to 8 designate Milio Management as the developer were Sandy Annabi, 9 John Murtagh, Dee Barbato and Pat MacDow, isn't that so? 10 A. I don't recall the names that were there at that time. 11 Q. Did you ever speak to John Murtagh in an effort to persuade 12 him to vote to designate you the developer? 13 A. No. 14 Q. Did you ever speak to Dee Barbato in an effort to persuade 15 her to vote to designate you the developer? 16 A. Personally, never. 17 Q. Did you ever speak to Pat MacDow to persuade her to vote to 18 designate you the developer for Longfellow? 19 A. Personally, no. 20 Q. And did you ever speak to Sandy Annabi in an effort to 21 persuade her to vote to designate you the developer for 22 Longfellow? 23 A. I spoke to the commission initially at first but after 24 that, no. 25 Q. I'm not asking about the commission. I'm asking about SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1567 C31Qann1 A. Milio - Cross 1 Sandy Annabi. 2 A. No. 3 Q. By the way, you were asked, I believe, on direct 4 examination when you went to the United States, and I think you 5 said in 1972, is that correct? 6 A. Yes. 7 Q. Do you remember when it was that you became a naturalized 8 United States citizen? 9 A. Ten years ago. 10 Q. So that would have been in 2002? 11 A. Yes, that's correct, precisely October of 2002. 12 Q. Now, you told Mr. Siano yesterday that you had been engaged 13 in the tax evasion scheme for decades, do you remember that 14 testimony? 15 A. Yes. 16 Q. So you were engaged in the tax evasion scheme before you 17 applied for citizenship? 18 A. Yes. 19 Q. And you knew at the time that you were engaged in the tax 20 evasion scheme that what you were doing was illegal, correct? 21 A. Yes. 22 Q. When you filled out the application -- withdrawn. Do you 23 remember filling out the application for United States 24 citizenship? 25 A. I do recall. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1568 C31Qann1 A. Milio - Cross 1 Q. Do you remember answering all of the questions on the 2 citizenship application form? 3 A. I don't -- 4 Q. I'm sorry? 5 A. I don't recall that. 6 Q. But do you recall that when you filled out the application, 7 you swore that all of the answers that you gave were truthful? 8 A. Yes. 9 Q. But all the answers that you gave on your application were 10 not truthful, were they, Mr. Milio? 11 A. I suppose not. 12 Q. Well, you recall that one of the questions on the 13 application was whether you had committed any crimes for which 14 you had not been arrested? 15 A. I had never been arrested, but I don't recall what I filled 16 out. 17 Q. Do you recall that one of the questions was whether or not 18 you had committed any crime or offense for which you had not 19 been arrested? Do you remember that question? 20 MR. HALPERIN: Objection. Asked and answered. 21 THE COURT: Objection is overruled. 22 A. I don't recall that. 23 Q. Do you remember that -- 24 MR. HALPERIN: I'm sorry, Judge. Can we have a 25 moment? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1569 C31Qann1 A. Milio - Cross 1 (Pause) 2 BY MR. ARONWALD: 3 Q. I'm showing you what is marked as Defense Exhibit 50 for 4 identification. This is an application for naturalization that 5 was revised on June 17 of 2011. 6 A. Yes. 7 Q. I want you to please take a look at this and tell me 8 whether this looks similar to the application that you filled 9 out, and I'm specifically directing your attention to question 10 number 15. 11 MR. HALPERIN: Judge, can we just see question 15 12 again? I didn't get a chance to look at that. 13 MR. ARONWALD: I showed it to you before. 14 MR. HALPERIN: You showed us the first page. 15 MR. ARONWALD: I'm sorry. 16 A. What is the question? 17 Q. Just has he reviewed the form. 18 A. I don't recall that. 19 Q. When you filled out the form and submitted it, were you 20 called in to explain any of your answers to the immigration 21 authorities? 22 A. I was called, yes. Yes. 23 Q. And that was with respect to what information? 24 A. I don't recall. 25 Q. When you were called in, were you questioned concerning any SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1570 C31Qann1 A. Milio - Cross 1 criminal acts that you had committed for which you had not been 2 arrested? 3 A. I don't recall. 4 Q. Do you recall whether you were questioned about the tax 5 evasion scheme that you testified to here? 6 MR. HALPERIN: Objection. Asked and answered. 7 THE COURT: The objection is sustained. 8 Q. You also took an oath of allegiance, correct, when you 9 became a citizen? 10 A. Yes. 11 Q. Do you recall that in your oath of allegiance you swore 12 that you would have true faith and allegiance to the United 13 States. Do you recall that? 14 A. Yes. 15 Q. And after you took the oath of allegiance, you continued to 16 carry on that same tax evasion scheme that you had been engaged 17 in before you took that oath of allegiance, correct? 18 A. Yes. 19 Q. By the way, in September of 2006, the Longfellow -- 20 withdrawn -- the city council designated Milio Management as 21 the developer for Longfellow by a vote of seven to nothing, 22 correct? 23 A. It seems to me yes, that's true. 24 Q. What happened to the project? 25 A. There was another school together -- there was another SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1571 C31Qann1 A. Milio - Cross 1 school that I was supposed to construct Walgreens, and 2 Walgreens said that it was going to take too long, and they 3 didn't want to do it any more, they lost interest. 4 Q. So, in other words, you walked away from the project, 5 correct? 6 A. I walked away from the project because the cost of the 7 project had become far too high. 8 Q. That was a business decision that you made, correct? 9 A. Yes. 10 Q. By the way, you continued to employ Mr. DelBello as the 11 attorney on the Longfellow project until after the city council 12 designated you the developer, correct? 13 A. Yes. 14 Q. Do you know who Joseph Guarniero, G-U-A-R-N-I-E-R-O. 15 A. I've heard him mentioned, but I have never met him. 16 Q. Now, when you had your initial meeting with Mr. Mangone, do 17 you recall who else was present at that meeting? 18 MR. HALPERIN: I'm sorry, could we just get a date, 19 Judge? 20 MR. ARONWALD: The initial meeting. 21 THE COURT: The first meeting with Mr. Mangone. 22 MR. ARONWALD: Yes. 23 Q. Do you recall -- strike that. Do you recall your first 24 meeting with Anthony Mangone? 25 A. I don't recall the first meeting. I think it may have been SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1572 C31Qann1 A. Milio - Cross 1 my son that went to that meeting. 2 Q. I'm talking the first meeting that you were at. 3 A. Yes, I do remember having gone to his office and having 4 spoken to him. 5 Q. OK. And who else was there? 6 A. I don't recall. 7 Q. Was your son there? 8 A. That could be, but I don't recall. 9 Q. Do you recall when you first met him, what year that was? 10 A. I think it was 2006. 11 Q. Do you recall what month it was? 12 A. No. 13 Q. Do you remember being interviewed -- withdrawn. Do you 14 recall telling the FBI that you, Franco and your nephew, 15 Dominick, met with Anthony Mangone to discuss the problems you 16 were having with the city of Yonkers in moving the Longfellow 17 project forward? 18 A. I do recall that, but I was not present. 19 Q. Didn't you tell the FBI in March of 2008 that you, together 20 with your son, Franco, and your nephew, Dominick, met with 21 Mangone to discuss the problems you were having with the city 22 of Yonkers in advancing the Longfellow project forward? 23 MR. HALPERIN: Objection. Asked and answered. 24 THE COURT: The objection is sustained. 25 MR. HALPERIN: Judge, could you instruct the witness SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1573 C31Qann1 A. Milio - Cross 1 not to answer? 2 THE COURT: Sir, there is no question pending. Ask 3 your next question, please. 4 BY MR. ARONWALD: 5 Q. I'm showing you what's marked as 3519-E, and I'm referring 6 your attention to page 4, the first full paragraph. Would you 7 please look at the first sentence and read it to yourself. 8 A. I don't remember that Dominick was ever with me when I was 9 speaking to Mr. Mangone. 10 Q. Do you deny that you told the FBI that he was there? 11 A. I don't recall. I'm not denying it, but I don't recall. 12 THE INTERPRETER: Sorry. 13 Q. And it's true, is it not, that in any of the discussions 14 that you had with Anthony Mangone, he never mentioned the name 15 Sandy Annabi to you, did he? 16 A. He did mention it, but I don't remember in what 17 circumstances. 18 Q. Do you recall testifying before the grand jury on 19 September 18, 2008? 20 A. Yes. 21 Q. Do you recall being asked these questions and giving these 22 answers before the grand jury at page 10/line 3 through line 8: 23 "Q. What was your understanding about who Mangone was giving 24 that $30,000 to? 25 "A. My understanding was, was given to Annabi. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1574 C31Qann1 A. Milio - Cross 1 "Q. Annabi? 2 "A. Annabi, but they never mentioned to me the name Annabi. 3 They never mentioned to me." 4 MR. HALPERIN: Objection. Mischaracterizes the 5 document. 6 MR. ARONWALD: Your Honor, I'm happy to hand the 7 document up to the Court. And I resent being called a -- 8 THE COURT: Excuse me, Mr. Aronwald, please. We don't 9 need speeches. 10 MR. ARONWALD: I'm not mischaracterizing anything. 11 THE COURT: We don't need the speeches. 12 MR. ARONWALD: Lines 3 through 9, your Honor. 13 THE COURT: Fine. 14 MR. HALPERIN: Can we approach, Judge? 15 THE COURT: No, you've had yours for the day. I don't 16 have any problems with it going on. 17 THE INTERPRETER: May the witness have either the text 18 or can we scroll down? 19 Q. Lines 3 through 9. You want me to read it again? Would 20 that be easier for you? 21 A. Whatever suits you. 22 Q. Were you asked the following questions and did you give the 23 following answers on lines 3 through 8: 24 "Q. What was your understanding about who Mangone was giving 25 that $30,000? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1575 C31Qann1 A. Milio - Cross 1 "A. My understanding was, was given to Annabi. 2 "Q. Annabi? 3 "A. Annabi, but they never mentioned to me the name Annabi, 4 they never mentioned to me." 5 Do you recall being asked those questions and giving 6 those answers before the grand jury on September 18, 2008? 7 A. My understanding was that the money was going to 8 Ms. Annabi. 9 Q. Did you tell the grand jury that they never mentioned the 10 name Sandy Annabi to you? Yes or no. 11 MR. HALPERIN: Judge, objection. To which 12 conversation we're talking about? 13 THE COURT: Excuse me. The objection is overruled. 14 A. I don't recall. 15 MR. ARONWALD: Your Honor, I would offer that portion 16 as Defense Exhibit 51 redacted to include just those lines. 17 THE COURT: Actually, why don't you show him that 18 portion, let the translator translate it for him and see if it 19 jogs his memory. If it doesn't jog his memory, then we'll 20 discuss what we do. 21 (Pause) 22 THE COURT: Hang on. Just a minute. Sir, this is a 23 portion of your grand jury testimony, OK? 24 A. The day that I brought the money over -- 25 THE COURT: No. No. No. No. No. No. The question SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1576 C31Qann1 A. Milio - Cross 1 is, does that jog your memory that you said to the grand jury 2 "nobody ever said the name Annabi to me?" 3 THE WITNESS: No, I don't recall. 4 MR. ARONWALD: I would offer that portion as Defense 5 Exhibit 51, your Honor. 6 MR. HALPERIN: We have no objection as long as its 7 starts with page 9 line 17, otherwise, we don't think it's 8 inconsistent. 9 MR. ARONWALD: No, your Honor, I disagree. 10 THE COURT: I'll take this. You can do what you want. 11 Obviously, ladies and gentlemen, it's for you to 12 decide whether there is an inconsistency, I told you that. 13 That's your job. And remember that this testimony is only 14 being offered as impeachment; that is to say, to try to cast 15 doubt on the testimony given here at the trial by the witness. 16 What he says to you from this witness stand, that is his 17 testimony. Go on, please. 18 (Defendant's Exhibit 51 in evidence) 19 BY MR. ARONWALD: 20 Q. Now, with respect to the $30,000 that you delivered to 21 Mr. Mangone, you testified that you delivered 40,000 but 10,000 22 of that represented legal fees that you owed to Mr. Mangone, 23 correct? 24 A. Yes. 25 MR. ARONWALD: Bear with me one minute, your Honor, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1577 C31Qann1 A. Milio - Cross 1 please. 2 (Pause) 3 MR. ARONWALD: Your Honor, thank you. I have no 4 further questions of the witness. 5 THE COURT: Mr. Halperin. 6 MR. HALPERIN: Thank you, your Honor. 7 (Continued on next page) 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1578 C31UANN2 A. Milio - redirect 1 REDIRECT EXAMINATION 2 BY MR. HALPERIN: 3 Q. Good morning, Mr. Milio. 4 A. Good morning. 5 Q. Counsel just asked you a couple of questions about Tony 6 Ricciardi. Do you remember that? 7 A. Yes. 8 Q. You said that on one occasion you gave him cash and he gave 9 you a check, correct? 10 A. Yes. 11 Q. As far as you know, is there anything illegal about giving 12 somebody cash and them giving you a check back? 13 A. I don't think it is illegal. 14 Q. Do you recall, counsel asking you about the details 15 relating to your tax evasion scheme and your knowledge of how 16 the scheme worked? 17 A. Yes, more or less. 18 Q. Do you fill out your own tax returns or do you hire an 19 accountant to help you? 20 A. I have never filled one out myself. 21 Q. You hire someone to help you? 22 A. Yes. 23 Q. Do you have any idea what the difference is between an IRS 24 Form 940 and an IRS Form 941? 25 A. No. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1579 C31UANN2 A. Milio - redirect 1 Q. But you do know that you cheated on your taxes, sir, 2 correct? 3 A. I did know that I wasn't paying 100 percent of what I owed. 4 Q. And you don't deny that, right? 5 A. No. 6 Q. And you cheated on your taxes for many years, correct? 7 A. Yes. 8 Q. Now, counsel asked about your paying tips and Christmas 9 gifts to city employees. Do you recall those questions? 10 A. Yes. 11 Q. I think you even said that you gave Christmas gifts like 12 cookies. Do you recall that? 13 A. Yes. It was always around Christmastime, we would send 14 cookies or something like that. 15 Q. Did you ever send bottles of liquor? 16 A. Yes. 17 Q. And what favors if any did you ask for in return for these 18 tips and Christmas gifts? 19 A. I never asked anyone for a favor. 20 Q. What corners if any did you ask inspectors to cut for you? 21 A. I never asked anyone to cut corners for me. The only thing 22 that I ever asked for was if I did something wrong that I be 23 informed of what it is so that I could correct it. 24 Q. How many times did you give a building inspector a $30,000 25 cash Christmas gift? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1580 C31UANN2 A. Milio - redirect 1 A. Santa Claus isn't that rich. 2 Q. Sir, counsel asked you yesterday and just now about a 3 portion of your grand jury testimony starting on page 10. Do 4 you recall those questions? 5 A. You mean the questions that were just asked? 6 Q. Yes. Do you recall them being asked? 7 A. Now or then? 8 Q. When counsel was asking you questions a few moments ago and 9 yesterday. 10 A. Yes, I recall that I was asked that question, yes. 11 Q. But you were not asked about the questions that I asked you 12 in the grand jury starting on page 9, correct? 13 THE COURT: How would he know? It is not necessary 14 for you to do that, to lead in. 15 MR. HALPERIN: Fair enough, Judge. 16 Q. Sir, I am now going to show you what has been marked as 17 3519-B1 which is 3519, pages 9 through 11. 18 Sir, do you recall being asked these questions and 19 giving these answers in the grand jury starting on page 9 of 20 your grand jury testimony from September 18, 2008, line 17: 21 "Q Let me direct your attention to about June of 2006. Do 22 you remember a time when Anthony Mangone called your son Franco 23 about some money? 24 "A Yes." 25 Yes? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1581 C31UANN2 A. Milio - redirect 1 A. Yes. 2 Q. "Q What did Franco tell you Mangone said in that phone 3 call? 4 "A Said he needed 30,000 and they can help." 5 A. Yes. 6 MR. ARONWALD: There is no question. 7 MR. HALPERIN: The question is, does he recall being 8 asked these questions and giving these answers. 9 MR. ARONWALD: Now, there is a question. 10 THE COURT: He did ask that question before he read. 11 MR. ARONWALD: He just asked it. 12 MR. HALPERIN: Thank you, your Honor. 13 BY MR. HALPERIN: 14 Q. "Q Mangone told Franco that they needed $30,000 and they 15 can help? 16 "A Correct." 17 A. Yes. 18 Q. "Q What was your understanding about who Mangone was 19 giving the $30,000 to? 20 "A My understanding was, was given to Annabi." 21 A. Yes. 22 Q. "Q Annabi? 23 "A Annabi. But they never mentioned to me the name Annabi, 24 they never mentioned to me." 25 A. Yes, I agree. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1582 C31UANN2 A. Milio - redirect 1 Q. "Q But your understanding was that the money was going to 2 Annabi? 3 "A Yes." 4 A. Perfect, yes. 5 Q. "Q By Annabi you mean Sandy Annabi? 6 "A Correct." 7 A. Yes. 8 Q. "Q The city councilwoman from Yonkers? 9 "A Correct." 10 A. Yes. That is what I understood. 11 Q. "Q Did Franco tell you that Mangone said that the $30,000 12 had to be in cash? 13 "A Yes." 14 A. Yes. 15 Q. "Q Did Mangone tell Franco that if he gave the $30,000, 16 the Longfellow project would be approved? 17 "A It would be a great help." 18 A. Yes. 19 Q. So, sir, do you recall being asked all of those questions 20 and giving all of those answers in the grand jury, correct? 21 A. Yes. 22 MR. HALPERIN: Your Honor, the government offers what 23 I will call 3519-B1, page 9, line 17 through page 11. 24 MR. ARRONWALD: Objection, your Honor. 25 THE COURT: You are offering it under the rule of SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1583 C31UANN2 A. Milio - redirect 1 completeness, are you not? 2 MR. HALPERIN: Correct, and also as -- 3 THE COURT: It is in. 4 (Government Exhibit 3519-B1 received in evidence) 5 BY MR. HALPERIN: 6 Q. Now, Mr. Milio, counsel asked you questions yesterday about 7 the day you brought the $30,000 to Mangone in his office. Do 8 you recall those questions? 9 A. Yes, I do remember them. 10 Q. And counsel asked about how Mangone said to you at the 11 time, she's going away on vacation. This is going to help. 12 She is going to be very happy. Do you recall those questions? 13 A. Yes. 14 Q. Let me ask you again, who did you understand Mangone to 15 mean when he said she's going away on vacation? 16 A. Well, what I understood was, it was Ms. Annabi. 17 Q. Just to be clear, during that particular conversation, 18 Mr. Mangone never used Ms. Annabi's name, correct? 19 A. No. 20 Q. Now, do you recall counsel asking you questions about how 21 you are using an Italian interpreter today? 22 No, no -- 23 A. Yes, I recall. 24 Q. And counsel asked you how you didn't need an interpreter 25 when you pled guilty, correct? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1584 C31UANN2 A. Milio - redirect 1 A. Yes, I remember that. 2 Q. And at the time of your guilty plea, you signed a 3 cooperation agreement with the government, correct? 4 A. Yes. 5 Q. I am now going to show you your cooperation agreement 6 marked GX 3519-P which the Court received in evidence at the 7 defendants' request. 8 I will direct your attention to the last page. Sir, 9 did you sign that agreement? 10 A. Yes. 11 Q. On what date? 12 A. February 3, 2012. 13 Q. Was that around the time you pled guilty? 14 A. Yes. 15 Q. Who if anyone read this five-page cooperation agreement to 16 you before you signed it? 17 A. My lawyer and my son. 18 Q. Who if anyone explained the cooperation agreement to you 19 before you signed it? 20 A. My lawyer. 21 Q. Sir, do you speak English? 22 A. Yes. 23 Q. Are you trying to hide from this jury the fact that you 24 speak English? 25 MR. ARONWALD: Leading. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1585 C31UANN2 A. Milio - redirect 1 THE COURT: It is not leading. It is argument. So we 2 are going to sustain the objection on the alternative ground 3 that it is an argumentative question. 4 Q. When you and I met in the past, what language did you 5 speak, sir? 6 A. English. 7 Q. As far as you know, do I speak Italian? 8 A. No. 9 Q. I wish I did. 10 Sir, what is your first language? 11 A. Italian. 12 Q. What country did you grow up in? 13 A. In Italy. 14 Q. I'm sorry? 15 A. Italy. 16 Q. How old were you when you first came to the United States? 17 MR. ARONWALD: Beyond the scope of cross, your Honor. 18 THE COURT: We only got that. It is on direct. You 19 don't need to say it again. You can argue it at the 20 appropriate time, but it is in the record. It is in the 21 record. 22 MR. HALPERIN: Fair enough. 23 THE COURT: It is in the record how old the witness 24 was when he began to learn English. Make your argument. 25 MR. HALPERIN: I will withdraw that question. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1586 C31UANN2 A. Milio - redirect 1 BY MR. HALPERIN: 2 Q. Sir, which language do you understand better, English or 3 Italian? 4 A. Italian. 5 Q. Which language are you more comfortable with? 6 A. Italian. 7 Q. How many times have you testified before in a federal court 8 with a federal judge, a jury, and defense counsel who are 9 cross-examining you? 10 A. Never. 11 Q. To make sure you understood all of the questions properly, 12 which language did you want to testify in? 13 A. In Italian. 14 MR. SIANO: Objection. 15 THE COURT: Can we get off of this subject and go on 16 to a different one. 17 MR. HALPERIN: I am finished, your Honor. 18 MR. SIANO: No questions. 19 THE COURT: Thank you, Mr. Siano. 20 MR. SIANO: I spoke first, your Honor, because I went 21 first. I think Mr. Aronwald is still contemplating his 22 options. 23 THE COURT: I wasn't suggesting that you had spoken 24 for Mr. Aronwald. That day has not yet arrived. 25 MR. SIANO: Amen. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1587 C31UANN2 A. Milio - redirect 1 MR. ARONWALD: No questions, your Honor. 2 THE COURT: Goodbye, Mr. Milio. 3 THE WITNESS: Thank you. 4 (Witness excused) 5 THE COURT: Call your next witness. 6 MR. CARBONE: The government calls Mr. Anthony 7 Mangone. 8 ANTHONY MANGONE, 9 called as a witness by the government, 10 having been duly sworn, testified as follows: 11 DIRECT EXAMINATION 12 BY MR. CARBONE: 13 THE COURT: You may inquire. 14 MR. CARBONE: Thank you, your Honor. 15 Q. Good morning, Mr. Mangone. 16 A. Good morning. 17 Q. Mr. Mangone, until recently what was your profession? 18 A. I was an attorney. 19 Q. When did you stop practicing law? 20 A. Spring of 2011. 21 Q. Have you resigned from the bar association? 22 A. No. I was disbarred. 23 Q. Was that associated with the charges in this case that you 24 pled guilty to? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1588 C31UANN2 Mangone - direct 1 Q. Please describe your educational background. 2 A. I have an undergraduate from SUNY Purchase and a law degree 3 from St. John's University. 4 Q. When were you admitted to practice law? 5 A. October 2001. 6 Q. What areas of law did you practice? 7 A. It was a general practice. I did criminal law, corporate 8 law, litigation, election law. 9 Q. Were you affiliated with any law firm? 10 A. Yes. 11 Q. What firm were you affiliated with? 12 A. I started as an associate at Servino Santangelo and then it 13 blossomed into a firm where I became a partner. 14 Q. And what was the name of the firm that you were a partner 15 in? 16 A. Santangelo Randazzo and Mangone. 17 Q. What areas of law did the firm of Servino Santangelo 18 Randazzo and Mangone practice? 19 A. It was general practice. It did municipal law, criminal 20 law, business law, real estate law, litigation. 21 Q. How old are you? 22 A. 38. 23 Q. Where do you live? 24 A. Purchase, New York. 25 Q. Have you ever worked for any state or local agency? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1589 C31UANN2 Mangone - direct 1 A. Yes, I have. 2 Q. What positions have you held? 3 A. I was deputy commissioner of Westchester board of 4 elections. I was a clerk for the Westchester County clerk's 5 office. I worked as a chief of staff to a state senator and a 6 counsel to a state senator. 7 Q. Approximately when did you hold those positions? 8 A. I worked in the public sector from 1995 through 2008 -- 9 yes, 2008. 10 Q. You mentioned had you worked for a state senator as chief 11 of staff. Who was that? 12 A. Nicholas Spano. 13 Q. What was your relationship with Nicholas Spano? 14 A. I was his friend, chief of staff, counsel. 15 Q. You know the defendants in this case? 16 A. Yes, I do. 17 Q. Have you had prior dealings with them? 18 A. Yes, I have. 19 Q. Which one? 20 A. Both of them. 21 Q. Has Zehy Jereis ever been employed by any public agencies? 22 A. Yes. 23 Q. And what positions did he hold? 24 A. I know he was an elections coordinator for the Westchester 25 County board of elections and he worked for a period of time in SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1590 C31UANN2 Mangone - direct 1 Westchester County government and he also worked for Senator 2 Spano's office. 3 Q. Did you work together with him? 4 A. At one point for Senator Spano's office. 5 Q. Did you interact with him at the board of elections? 6 A. From time to time. 7 Q. Please describe those interactions. 8 A. He was in charge of election machines and election 9 districts, so whenever we needed information particular to a 10 election district, we would reach out to Zehy and he was very 11 responsive. 12 Q. Has Zehy Jereis held any positions in any political 13 parties? 14 A. Yes. 15 Q. What positions has he held? 16 A. He has been a Republican district leader, a chairman of the 17 Republican party in Yonkers and an executive committee member 18 of the party. 19 Q. Have you worked together with him on political matters? 20 A. Yes. 21 Q. When did you first meet Zehy Jereis? 22 A. Sometime around 1996. 23 Q. Can you describe your relationship with him? 24 A. During that period of time he was an election 25 coordinator/helper for Senator Spano's senate race against Tom SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1591 C31UANN2 Mangone - direct 1 Abinanti, and he was a good organizer, petition gatherer, good 2 for getting volunteers together. 3 Q. Have you socialized? 4 A. Yes. 5 Q. Have you had drinks together? 6 A. Yes. 7 Q. Dinner? 8 A. Yes. 9 Q. Have you ever been to his home? 10 MR. ARONWALD: Your Honor, leading. 11 THE COURT: Let's just get through this. 12 Q. Have you ever been to his home, sir? 13 A. Yes, I have. 14 Q. And where does Mr. Jereis live? 15 A. I don't know where he lives now, sir. 16 Q. When you went to his home, where did he live? 17 A. He was my neighbor around the corner from me. 18 Q. What town is that in? 19 A. Yonkers. 20 Q. Who did he live there with? 21 A. His family. 22 Q. Has Mr. Jereis ever been to your home? 23 A. Yes. 24 Q. What does Zehy Jereis do for a living? 25 A. He is a real estate owner. I believe he has an interest in SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1592 C31UANN2 Mangone - direct 1 a car wash. 2 Q. You said that he is a real estate owner. Where are the 3 properties that he owns? 4 A. I know some of them to be in the southwest part of the 5 city, but I don't know where all of them are. 6 Q. How is it that you came to meet Mr. Jereis? 7 A. Just on the election trail. 8 Q. Have you attended political events together? 9 A. Yes. 10 Q. Have you had business dealings with Mr. Jereis? 11 A. Yes. 12 Q. By early 2006, what was the frequency of your contact with 13 Zehy Jereis? 14 A. Whenever I needed to be. It was whenever I needed to speak 15 to him, I could call him. 16 Q. Have you ever given Zehy Jereis money in connection with 17 matters unrelated to this case? 18 A. Yes. 19 Q. Approximately when did that happen? 20 A. Approximately 2003 through 2006. 21 Q. For what purpose did you give him money? 22 A. Referrals on legal cases that he referred to my office. 23 Q. Approximately how many referrals? 24 A. Say, six or seven. 25 Q. Did you pay him by check or by cash? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1593 C31UANN2 Mangone - direct 1 A. Cash. 2 Q. What was the total amount, approximately, that you gave him 3 in cash? 4 A. Somewhere between 15 and 20,000. 5 Q. When did you first meet Sandy Annabi? 6 A. Sometime after she was elected, maybe 2002. 7 Q. How did you meet her? 8 A. I believe, at a fundraiser. 9 Q. Do you ever socialize with Sandy Annabi? 10 A. I have in the past. 11 Q. What kind of events have you attended? 12 A. Fundraisers, holiday parties. 13 Q. Mr. Mangone, would you please look at Government Exhibit 14 805 which has been marked for identification which is in a 15 binder in front of you? 16 A. OK. 17 Q. What is Government Exhibit 805? Do you have it? 18 A. Yes. 19 Q. What is Government Exhibit 805? 20 A. It is an email. 21 Q. Who is it from? 22 A. Sandy Annabi. 23 Q. And who is it to? 24 A. Me. 25 Q. What is the date of the email? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1594 C31UANN2 Mangone - direct 1 A. December 18, 2005. 2 Q. What was attached to this email? 3 A. A picture. 4 Q. Who is the picture of? 5 A. Myself and Sandy. 6 MR. CARBONE: Your Honor, the government offers 7 Exhibit 805 in evidence. 8 MR. ARONWALD: No objection. 9 MR. SIANO: No objection. 10 THE COURT: Admitted. 11 (Government Exhibit 805 received in evidence) 12 MR. CARBONE: Please broadcast Government Exhibit 805, 13 second page. 14 BY MR. CARBONE: 15 Q. Mr. Mangone, when was this photo taken? 16 A. This was at my firm's holiday party in 2005. 17 Q. Now, do you know Sandy Annabi's family? 18 A. Yes. 19 Q. Have you represented any of her family members on legal 20 matters? 21 A. Yes. 22 Q. What members of her family have you represented? 23 A. I assisted her father in the drafting of a promissory note, 24 and then my firm represented her brother. 25 Q. How did you come to represent them? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1595 C31UANN2 Mangone - direct 1 A. Initially, her dad was referred to me by Zehy. 2 Q. Have you ever been in the company of both Sandy Annabi and 3 Zehy Jereis -- 4 A. Yes. 5 Q. -- when they were together? 6 A. Yes. 7 Q. Have you observed them interact with each other? 8 A. Yes, I have. 9 Q. Have you ever discussed the relationship between Sandy 10 Annabi and Zehy Jereis with Zehy Jereis? 11 A. Yes. 12 Q. Based upon your observations and your conversations with 13 Zehy Jereis, can you describe their relationship? 14 A. They were very close. 15 Q. What if any interaction did they have in connection with 16 political matters? 17 When you said they were close, what was his role in 18 connection with the City of Yonkers business or political 19 matters vis-a-vis Sandy Annabi? 20 MR. SIANO: Objection, your Honor. Leading. 21 THE COURT: Overruled. 22 A. Zehy was her political advisor, her handler. 23 Q. And what do you mean by handler? 24 A. I believe she would defer to him for his advice and 25 counsel. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1596 C31UANN2 Mangone - direct 1 Q. Have you had occasion to contact Sandy Annabi on City of 2 Yonkers business in connection with your employment on Senator 3 Spano's staff? 4 A. Yes, I have. 5 Q. Can you give an example? 6 A. Budget matters, union contracts. 7 Q. Now, when you would contact Sandy Annabi or you needed to 8 discuss City of Yonkers business, how would you contact her? 9 A. I would either call her at her city council office or her 10 cell phone. 11 Q. And if you couldn't get in touch with her, what would you 12 do? 13 A. I would contact Zehy Jereis. 14 Q. Why would you go through Zehy Jereis? 15 A. Just because he always -- I always knew he had access to 16 her. 17 Q. What if any support did Zehy Jereis provide to Sandy Annabi 18 in connection with her campaigns? 19 A. Zehy was instrumental in getting her union endorsements, 20 fundraising, would help coordinate petition gathering and 21 drafting literature for her on her behalf, putting up signs, 22 electioneering issues. 23 Q. As far as you know, were Sandy Annabi and Zehy Jereis ever 24 romantically involved? 25 A. I have no independent knowledge of them being involved SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1597 C31UANN2 Mangone - direct 1 romantically. 2 Q. Do you have any reason to believe that is the case? 3 A. Not necessarily. 4 Q. What if any discussions did you have with Zehy Jereis on 5 the subject of whether he could influence Sandy Annabi on 6 matters affecting the City of Yonkers business? 7 A. I believe he could be effective. 8 Q. When you say you believe he could be effective, what if any 9 discussions did you have with him on that subject? 10 A. Whenever there was a matter that we felt we weren't able to 11 access Sandy, whether it would be on a union contract or a 12 budget issue, we would go to Zehy to help bring her on board. 13 Q. Who is Debbie Kayal? 14 A. She is my sister-in-law. 15 Q. Where was she employed in 2006? 16 A. She was employed by the Yonkers City Council. 17 Q. What if any role did you have in getting her hired? 18 A. Zehy had contacted me and told me that there was a job 19 available in Ms. Annabi's office, and I called him and asked if 20 he would consider my sister-in-law for the job. 21 Q. Was she then hired? 22 A. Yes, she was. 23 Q. Without disclosing the name, have you ever done any work 24 for a large developer in Westchester County? 25 A. Yes, I have. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1598 C31UANN2 Mangone - direct 1 Q. And what if anything did you do for that large developer? 2 A. I was a liaison to the Yonkers City Council. 3 Q. In what capacity? 4 A. Consultant. 5 Q. Consulting on what subject matter? 6 A. On a designation for a development and a zone change. 7 Q. Where, roughly, was that property located? 8 A. In the southwest part of Yonkers. 9 Q. What if any discussions did you have about this project 10 with Zehy Jereis? 11 A. At some point in time I had attempted to reach out to 12 Ms. Annabi to feel her out on what her issues were related to 13 the project and I was unable to. 14 MR. SIANO: Sidebar, your Honor. 15 THE COURT: Time for our mid morning break, folks. 16 Don't discuss the case. Keep an open mind. 17 18 (Continued on next page) 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1599 C31UANN2 Mangone - direct 1 (Jury not present) 2 (Witness excused) 3 MR. SIANO: Judge, we didn't get any 404(b) -- 4 THE COURT: We still have jurors here. 5 MR. SIANO: Sorry. 6 (Pause) 7 MR. SIANO: Judge, we didn't get any 404(b) on another 8 developer. I don't even know who they are talking about. 9 THE COURT: Maybe there is nothing criminal about it 10 and then it would not be subject to 404(b) notice, would it. 11 MR. ARRONWALD: I thought it was prudent to raise the 12 issue before something came out -- 13 THE COURT: I am assuming that the government has 14 complied with its obligations under 404(b) and that we won't 15 hear about any commissions of crimes in the course of this 16 testimony. 17 Will we, Mr. Carbone? 18 MR. CARBONE: We will not, your Honor. 19 THE COURT: Are we talking about the background of the 20 relationship of these people? 21 MR. CARBONE: Absolutely. Mr. Jereis asked for a 22 consulting agreement -- 23 THE COURT: Take a break. 24 MR. SIANO: Judge, are we going to have this picture 25 up for the entire direct? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1600 C31UANN2 Mangone - direct 1 THE COURT: I think it is kind of cute. 2 MR. HALPERIN: Two very housekeeping items, please. 3 When I offered 3519-B1, I didn't say an ending line 4 and the portion that we offered that we read and the Court 5 received is up to 3519-B1 page 10, line 21. 6 Secondly, I just have asked this several times before. 7 When defense counsel is showing documents, we obviously don't 8 have these documents in front of us. I have asked several 9 times for copies. I am not trying to give them a hard time, 10 but everything would go much smoother if we could just get a 11 copy at the time instead of us needing to ask the witness back 12 for a copy. I would like it placed on the record. 13 THE COURT: Consider it placed on the record. 14 Let's take a little break, not a long break. 15 (Recess) 16 17 (Continued on next page) 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1601 C31UANN2 Mangone - direct 1 (Jury present) 2 THE COURT: You are still under oath, Mr. Mangone. 3 Mr. Carbone. 4 BY MR. CARBONE: 5 Q. Mr. Mangone at the time of the break, you were explaining 6 that you were retained by a large Westchester developer. Can 7 you explain what if any discussions you had with Zehy Jereis 8 about this project? 9 A. Yes. I had asked if he could help get me in contact with 10 Ms. Annabi. 11 Q. Why did you go to him? 12 A. I had made a number of attempts to contact her and she 13 hadn't returned my phone calls. 14 Q. Please describe the substance of your discussions? 15 A. That I had placed at least four phone calls to her. She 16 had not returned my calls and I needed to find out where she 17 was because the person who had hired me had asked me for a 18 progress report. 19 Q. When you say where she was, do you mean where she was 20 physically located? 21 A. No, where she was in terms of the project, what her 22 feelings were on it. 23 Q. What if anything did Zehy Jereis say? 24 A. At first he had asked if there was any possibility that he 25 could be retained by the same property owner -- or developer, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1602 C31UANN2 Mangone - direct 1 rather. 2 Q. Retained in what capacity? 3 A. As a consultant. 4 Q. Do you recall what specifically he said? 5 A. He wanted to know if there was room for him at the table. 6 Q. What did you understand him to mean when he said room for 7 him at the table? 8 A. To have a job in the same capacity that I was there. 9 Q. Did you ask this large developer to hire Mr. Jereis? 10 A. No, I did not. 11 Q. Why not? 12 A. Because it would diminish my role and I didn't want to take 13 away my job. 14 Q. Now, you said that you had discussions with Zehy Jereis 15 about his relationship with Sandy Annabi? 16 A. Yes. 17 Q. Have you ever had a one-on-one discussion with him? 18 A. Yes. 19 Q. Did you ever have any discussion with him on the subject of 20 whether they had a romantic relationship? 21 A. Yes. 22 Q. What if anything did he say? 23 A. Just said that they were close, never actually said that 24 they were involved romantically. 25 Q. Have you entered a plea of guilty in this case? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1603 C31UANN2 Mangone - direct 1 A. Yes, I have. 2 Q. What crimes have you pled guilty to in this case? 3 A. I have pled guilty to the conspiracy charge, the receiving 4 of corrupt payment, the extortion under color of official 5 right, Travel Act bribery and tax evasion. 6 Q. When you say you pled guilty to bribery and extortion under 7 color of official right, what exactly did you plead guilty to 8 doing? 9 A. Receiving payments and passing them along to Zehy Jereis to 10 influence the vote of a council person. 11 Q. Who was that council person? 12 A. Ms. Annabi. 13 Q. You mentioned the word "extortion." Did you use any kind 14 of physical force or threats? 15 A. No. 16 Q. You mentioned that you pled guilty to conspiracy. Who did 17 you plead guilty to conspiring with? 18 A. I pled guilty to the conspiracy which involved myself, Zehy 19 Jereis and Ms. Annabi. 20 Q. Can you tell the jury exactly what you did? 21 A. I had approached my client. I had told him about a 22 conversation that I had with Mr. Jereis wherein he asked me for 23 money to influence Ms. Annabi's vote. 24 Q. Have you committed any other crimes? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1604 C31UANN2 Mangone - direct 1 Q. What crimes did you plead guilty to other than the bribe 2 scheme charged in this case? 3 A. Tax evasion. 4 Q. Did you accept cash fees from client that you failed to pay 5 taxes on? 6 A. Yes, I have. 7 Q. Have you and your law partners split cash fees? 8 A. Yes. 9 Q. As part of your cooperation in this case, what if anything 10 did you disclose to the government about other state law crimes 11 you committed? 12 A. Other crimes that I had been engaged in. 13 Q. What if anything did you disclose to the government about 14 cash payments to an individual not to run against former State 15 Senator Nick Spano? 16 A. That I had passed along a payment to an individual to keep 17 someone from running in a primary election against Senator 18 Spano. 19 Q. Are you familiar with the phrase "conduit contributions"? 20 A. Yes, I am. 21 Q. What does that phrase mean? 22 A. A conduit contribution is when an individual or corporation 23 gives money to another individual to make a campaign 24 contribution so that their name doesn't show up on a disclosure 25 or to avoid the campaign contribution limit laws. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1605 C31UANN2 Mangone - direct 1 Q. Have you made conduit contributions? 2 A. Yes, I have. 3 Q. How did you do that? 4 A. Through family and friends, close friends. 5 Q. Were those in connection with state or local elections? 6 A. Yes, they were. 7 Q. As part of your plea agreement, did you agree that when you 8 are sentenced, the judge can consider as relevant conduct your 9 participation in these other offenses? 10 A. Yes, I have. 11 Q. Have you been sentenced yet? 12 A. No, I have not. 13 Q. Have you entered into a plea agreement with the government 14 in this case? 15 A. Yes. 16 Q. What is your understanding of your obligations under the 17 plea agreement you have with the government? 18 A. My obligation is to testify truthfully, provide truthful 19 information and assist the government with any questions they 20 may have with related investigations. 21 Q. What is your understanding of the government's obligations 22 under your agreement? 23 A. Provided I fulfill my obligation, the government can bring 24 to the judge's attention my cooperation at the time of 25 sentencing. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1606 C31UANN2 Mangone - direct 1 Q. And would that be by a letter? 2 A. Yes. 3 Q. Have you been guaranteed any letter from the government? 4 A. No. 5 Q. What is the maximum sentence that you could get if you 6 don't get a letter from the government? 7 A. 45 years. 8 Q. What is the minimum sentence or the least amount of time 9 you could get if you do not get a letter from the government? 10 A. Probation. 11 Q. What is the maximum you could get if you do get a letter 12 from the government? 13 A. 45 years. 14 Q. And what is the minimum you could get if you do get a 15 letter from the government? 16 A. Probation. 17 Q. What is your understanding of what can happen to you if you 18 testify falsely in this trial? 19 A. I could be charged with a crime of perjury. 20 Q. And if you were convicted of lying to the jury, would any 21 sentence that would be imposed be in addition to the sentence 22 that would be imposed in connection with the crimes that you 23 already pled guilty to? 24 A. Yes. 25 MR. ARONWALD: Your Honor, that is a determination to SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1607 C31UANN2 Mangone - direct 1 be made by the Court. 2 THE COURT: I think that is the whole point of it, Mr. 3 Aronwald. This is fairly ritualized questioning. 4 Please continue, Mr. Carbone. 5 6 (Continued on next page) 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1608 C31Qann3 Mangone - Direct 1 Q. Mr. Mangone, would you look in front of you at Government 2 Exhibit 3517-EE. 3 A. Yes. 4 Q. What is 3517-EE? 5 A. This is a copy of the plea agreement I entered into with 6 the government. 7 Q. What is the date document? 8 A. November 12, 2010. 9 Q. Would you please turn to the last page. 10 A. Yes. 11 Q. Who signed the document? 12 A. Myself and my attorney. 13 Q. And on behalf of the government? 14 A. Perry Carbone, Jason Halperin and Richard Zabel. 15 MR. CARBONE: Your Honor, I offer Government Exhibit 16 3517-EE in evidence. 17 MR. SIANO: No objection. 18 MR. ARONWALD: No objection. 19 THE COURT: Admitted. 20 (Government's Exhibit 3517-EE received in evidence) 21 Q. Mr. Mangone, would you please turn to page 3. 22 Mr. Turk, would you mind highlighting and maximizing 23 the second full paragraph? Actually, can you maximize the 24 sentence beginning "it is understood" in that paragraph. 25 Mr. Mangone, could you please read to the jury the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1609 C31Qann3 Mangone - Direct 1 first sentence of that paragraph up to the first semicolon. 2 A. "It is understood that the defendant (a) shall truthfully 3 and completely disclose all information with respect to the 4 activities of himself and others concerning all matters about 5 which this office inquires of him, which information can be 6 used for any purpose." 7 Q. Now, Mr. Turk, would you maximize subparagraph (e) in that 8 paragraph? The little E after the semicolon. 9 Now, would you read what follows the little (e) about 10 your obligations. 11 A. "Shall truthfully testify before the grand jury and at any 12 trial and other court proceeding with respect to any matters 13 about which this office may request his testimony." 14 Q. Now turn to page 5 of the agreement. Mr. Turk, in 15 connection with the second full paragraph, could you please 16 maximize the first sentence of that paragraph? 17 Mr. Mangone, would you please read that sentence? 18 A. "It is understood that, should the defendant commit any 19 further crimes or should it be determined that he has given 20 false, incomplete, or misleading testimony or information, or 21 should he otherwise violate any provision of this agreement, 22 the defendant shall thereafter be subject to prosecution for 23 any federal criminal violation of which this office has 24 knowledge, including perjury and obstruction of justice." 25 Q. Now, on the next full paragraph, Mr. Turk, could you SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1610 C31Qann3 Mangone - Direct 1 maximize the next full paragraph up to the semicolon before the 2 word "and (b)." 3 Would you please read the next? 4 A. "It is understood that in the event that it is determined 5 that the defendant has committed any further crimes, given 6 false, incomplete or misleading testimony or information, or 7 otherwise violated any provision of this agreement, (a) all 8 statements made by the defendant to this office or other 9 designated law enforcement agents, and any testimony given by 10 the defendant before a grand jury or other tribunal, whether 11 prior to or subsequent to the signing of this agreement, and 12 any leads from such statements or testimony shall be admissible 13 in evidence in any criminal proceeding brought against the 14 defendant." 15 Q. Thank you. What is your understanding of who will sentence 16 you? 17 A. The Judge. 18 Q. Do you have any expectation of ever practicing law again? 19 A. No. 20 Q. Mr. Mangone, have you gambled in the past? 21 A. Yes, I have. 22 Q. Where have you gambled? 23 A. Atlantic City, Connecticut, Las Vegas, Bahamas, Puerto Rico 24 and Costa Rica. 25 Q. What games have you played? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1611 C31Qann3 Mangone - Direct 1 A. Blackjack, roulette, craps. 2 Q. During what time period did you gamble? 3 A. 2003 through 2009. 4 Q. Would you please tell the jury approximately how much you 5 typically gambled in a night? 6 A. $5,000 to $20,000. 7 Q. What is the most you have lost in any given night 8 approximately? 9 A. Approximately $20,000. 10 Q. Did you win on occasion? 11 A. Yes, I have. 12 Q. What is the most you've won on a night? 13 A. $38,000. 14 Q. When you went to casinos to gamble, where did you get the 15 money? 16 A. Either my own money or typically I would draw from a credit 17 line known as a marker in the casino. 18 Q. What is a marker? 19 A. It's essentially having an interest free credit line, which 20 you can draw down on while you're at the casino. 21 Q. Can you explain how you sign up for a marker? 22 A. It's essentially like signing up for a credit card or a 23 credit line. You just give them your name, your social 24 security number, and a copy of your check from your personal -- 25 or from a checking account, and they do a background check on SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1612 C31Qann3 Mangone - Direct 1 you, and they give you a credit line. 2 Q. Now, you said that it's an interest free credit line? 3 A. That's correct. 4 Q. Did you use the markers as a source of an interest free 5 loan from time to time? 6 A. Yes. 7 Q. Was that allowed under the rules? 8 A. No. 9 Q. How did you do that? 10 A. Typically, I would go into a casino that I had a credit 11 line in. I would draw down a marker. I would play for a few 12 moments, and then leave and take the cash. 13 Q. Did you ever get caught doing that? 14 A. Yes. 15 Q. What happened? 16 A. They suspended my credit line at Tropicana. 17 Q. What would you do with the cash after you got cash from a 18 marker? 19 A. I would play for a short period of time, and then I would 20 use that to cover other markers. 21 Q. Did you ever deposit any of that cash into your accounts? 22 A. Yes. 23 Q. For what purpose? 24 A. To cover markers that were becoming due from other casinos. 25 Q. Can you explain how that process works? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1613 C31Qann3 Mangone - Direct 1 A. Well, for any marker that you draw that's in and above 2 $5,000, you get 45 days to repay the marker. So if I knew a 3 marker was coming due on the -- around the 45th day, I would go 4 see another casino if I didn't have the money to cover it and I 5 would draw another marker and deposit the funds into my account 6 so that it was readily available to cover that marker. 7 Q. When you say you'd deposit the funds into your account, how 8 did the casino get the money out of your account? 9 A. Whenever you sign up for a credit line marker with the 10 casino, you're required to give them a check and essentially 11 they just use that check to withdraw from your account. 12 Q. Are you still gambling? 13 A. No. 14 Q. Are you familiar with a prosecution brought by the 15 Westchester County District Attorney's office known as People 16 v. Wedra? 17 A. Yes. 18 Q. Did that days go to trial? 19 A. Yes, it did. 20 Q. Approximately when was the case brought? 21 A. I believe it went to trial in 2002. 22 Q. What were the allegations in that case? 23 A. Tampering with absentee ballots. 24 Q. Who was the defendant? 25 A. Dennis Wedra. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1614 C31Qann3 Mangone - Direct 1 Q. Approximately when did the conduct that was alleged to have 2 occurred occur? 3 A. In the year 2000. 4 Q. Were you an attorney in 2000? 5 A. No, I was not. 6 Q. What year were you admitted? 7 A. October 2001. 8 Q. Was the case submitted to Westchester County grand jury for 9 determination of whether you should be charged with any 10 criminal conduct? 11 A. Yes. 12 Q. Were you ever charged by that grand jury? 13 A. No, I was not. 14 Q. What happened? 15 A. The grand jury returned no true bill as to me. 16 Q. What does a no true bill mean? 17 A. It meant that the grand jury didn't have -- didn't find 18 enough evidence to charge me with a crime. 19 Q. What conduct did you engage in in connection with that 20 case? 21 A. I had received absentee ballots that were open, and I had 22 tampered with them by placing the name of Nicholas Spano on the 23 ballot. 24 Q. Did you testify as a witness in that case? 25 A. Yes, I did. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1615 C31Qann3 Mangone - Direct 1 Q. When you testified in that case, did you make any false 2 statements? 3 A. Yes. 4 Q. Have you used prescription drugs that were not prescribed 5 to you? 6 A. Yes. 7 Q. During what time period? 8 A. From in and about 1998 through 2009. 9 Q. Approximately how often? 10 A. Once every six months. 11 Q. And you said that you practiced criminal law. What kinds 12 of cases would you handle? 13 A. Everything from misdemeanors to organized crime cases, 14 white collar cases, drug cases. 15 Q. Directing your attention to May of 2005, where was Zehy 16 Jereis working at that time? 17 A. He was employed by Senator Spano's office. 18 Q. During this time period, did you have any discussions with 19 Zehy Jereis on the subject of his continued employment with 20 Senator Spano? 21 A. Yes. 22 Q. Without providing specific details, can you please relay 23 the substance of those discussions? 24 A. Yeah. There was some highly sensitive information that was 25 going to be -- become publicized in the press that was going to SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1616 C31Qann3 Mangone - Direct 1 be particularly embarrassing to Zehy, and we felt that it would 2 have been detrimental to the senator that he stay on staff, so 3 I had asked him to tender his resignation. 4 Q. And did you do that in person? 5 A. Yes. 6 Q. Where did the meeting take place? 7 A. At a diner in Yonkers. 8 Q. Who was present? 9 A. Myself and Lenny Spano. 10 Q. Did Zehy Jereis continue on the senator's payroll for a 11 time after that? 12 A. I believe for a short period of time he might have used up 13 some vacation time that he had. 14 Q. What, if any, efforts did Senator Spano make to compensate 15 Zehy Jereis for the loss of his job on his staff? 16 A. We looked to try to place him down at the Yonkers Chamber 17 of Commerce. 18 Q. Were you successful in doing that? 19 A. Yes. 20 MR. CARBONE: Your Honor, this would probably be an 21 appropriate time for the Court to give a limiting instruction 22 to the jury on the evidence of uncharged conduct. I have a few 23 questions. 24 THE COURT: We're talking about limiting instruction 25 number two? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1617 C31Qann3 Mangone - Direct 1 MR. CARBONE: Yes. 2 THE COURT: OK. 3 Folks, before the trial, the lawyers and I went 4 through some evidence that the government proposed to 5 introduce, and I agreed that it could come in for a limited 6 purpose; that is, you can consider it for one thing but 7 absolutely not for anything else, and you are going to have 8 some questions right now that the government is going to ask as 9 part of offering evidence that tends to show that on different 10 occasions than the ones that you have to decide about, 11 different occasions than the ones charged in the indictment, 12 one of the defendants, Mr. Jereis, engaged in conduct that's 13 similar to conduct that's charged in the indictment. 14 What you will hear testimony about now and later 15 relates to a consulting agreement that the defendant Zehy 16 Jereis had with the Yonkers Chamber of Commerce. The 17 government is introducing evidence relating to this contract so 18 that it can argue that after this investigation became public, 19 Mr. Jereis submitted reports that the government contends were 20 back-dated like the reports that the government contends were 21 submitted to Forest City Ratner. 22 Now, you are going to hear this evidence from the 23 witness. I am admitting it for a limited purpose. First thing 24 I have to tell you it has nothing to do with Ms. Annabi. You 25 cannot consider it against Ms. Annabi for any purpose SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1618 C31Qann3 Mangone - Direct 1 whatsoever. Remember I told you we were going to do two trials 2 at the same time? It's not part of her case. Not part of her 3 case. 4 As far as Mr. Jereis is concerned, you may consider 5 this evidence for one purpose only; and, that is, as you decide 6 the questions that the lawyers will argue to you on whether 7 Mr. Jereis was acting pursuant to a unique modus operandi, the 8 old Latin phrase, a common scheme or plan in connection with 9 the Forest City Ratner situation, whether he acted with 10 criminal intent in connection with the charges in this case. 11 Now, it's a little tricky. Mr. Jereis is not on trial 12 for committing uncharged acts like the ones you are about to 13 hear about. There aren't any charges against him about what 14 you are about to hear about, so you may not consider the 15 evidence Mr. Mangone is about to give you as proof that 16 Mr. Jereis committed the crimes he's charged with in this case. 17 You can't substitute it for evidence that actually relates to 18 the charges in the case, and you can't consider this evidence 19 as proof that Mr. Jereis had a bad character or a criminal 20 personality or what we call a propensity to commit crimes. No, 21 no, no, no, no. 22 The evidence of the similar acts is admitted only for 23 the more limited purpose that I described to you, and you may 24 consider it only for that purpose. If you determine that 25 Mr. Jereis committed the acts that are charged in the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1619 C31Qann3 Mangone - Direct 1 indictment and other acts that are similar to the acts charged 2 in the indictment, then you may, though you need not, draw an 3 inference that in doing the acts that are charged in the 4 indictment Mr. Jereis acted knowingly and intentionally and not 5 because of some mistake, accident or other innocent reason. 6 But that's it. Evidence of similar acts may not be considered 7 by you for any other purpose. 8 And if I can be really specific and blunt about this, 9 you may not use this evidence to conclude that because Zehy 10 Jereis committed the acts Mr. Mangone is about to testify 11 about, assuming you believe he did, that he must have committed 12 the acts that are the subject of this indictment. That would 13 be an absolutely improper inference for you to draw. 14 OK, Mr. Carbone. 15 MR. CARBONE: Your Honor, just to clarify, the 16 previous eight questions relating to the chamber of commerce is 17 a portion of the government's 404(b) evidence. It's the only 18 portion that Mr. Mangone will testify about. 19 THE COURT: OK. 20 MR. CARBONE: What's coming up on the next about half 21 a dozen questions relating to the limit be instruction-- 22 THE COURT: Can we not have a chat like this? I don't 23 need to have a chat like this. 24 MR. CARBONE: Then I'd also ask that the Court give 25 limiting instruction one while you're at it. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1620 C31Qann3 Mangone - Direct 1 THE COURT: All right. 2 So there's another limiting instruction and we haven't 3 heard any of this evidence yet. What you are about to hear 4 from Mr. Mangone evidence about an alleged scheme to bribe a 5 potential candidate not to run for a state office. There was a 6 question about that 45 minutes ago, and now you are going to 7 hear some more information about that. 8 Again, not charged in this case. Not something that 9 you're going to be asked to find whether the government has 10 proved beyond a reasonable doubt that Mr. Jereis did this 11 particular thing. The evidence is being offered by the 12 government and is being admitted for the limited purpose of 13 explaining the relationship and the mutual trust that it says 14 existed between Mr. Jereis and Mr. Mangone. And that's the 15 only purpose for which you can consider this evidence. 16 And, once again, it has nothing at all to do with 17 Ms. Annabi, and you cannot consider this evidence against 18 Ms. Annabi. Not part of her trial. 19 All right. 20 MR. CARBONE: Thank you. 21 Q. Mr. Mangone, directing your attention to the summer of 22 2006. 23 A. Yes. 24 Q. During that time period, what, if any, office was Nick 25 Spano running for? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1621 C31Qann3 Mangone - Direct 1 A. State senate. 2 Q. What geographic area did his district cover? 3 A. Yonkers -- parts of Yonkers, Greenburgh, Mount Pleasant and 4 parts of White Plains. 5 Q. Did he have any opposition in that race? 6 A. Yes, he did. 7 Q. Who was his opposition? 8 A. Democratic line it was Andrea Stewart Cousins. 9 Q. And without naming names, were there any other potential 10 candidates? 11 A. Yes, on the minor party lines. 12 Q. And what were the minor party lines? 13 A. In that year it was the Conservative and Independence Party 14 lines. 15 Q. Were there any -- what minor party was this potential 16 candidate affiliated with? 17 A. Independence Party's. 18 Q. Now, when you say Independence Party, is that an actual 19 party or does it mean that you're just independent from the 20 other parties? 21 A. No, it's an actual party affiliation that voters are 22 registered in. 23 Q. What, if any, significance does the Independence Party have 24 in Westchester County politics? 25 A. Well, for our particular race with Senator Spano it was SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1622 C31Qann3 Mangone - Direct 1 very important because we need the line to overcome a very, 2 very large democratic -- I think there were 40,000 more 3 democrats than there were republicans in the district. 4 Q. And Senator Spano is republican? 5 A. That's correct. 6 Q. Who is John Khader? 7 A. He was a member of the Independence Party. 8 Q. What, if any, relationship exists between John Khader and 9 Zehy Jereis? 10 A. Neighbors and friends. 11 Q. Now, during this time frame, what, if any, discussions did 12 you have with Zehy Jereis about this potential candidate from 13 the Independence Party? 14 A. Zehy had approached me and told me that in order to get the 15 individual not to run, they were seeking a $10,000 payment. 16 Q. And that $10,000 payment, what form was that payment 17 supposed to take? 18 A. It was cash. 19 Q. What, if anything, did you do after Zehy Jereis requested 20 $10,000 in cash for this potential candidate? 21 A. I made arrangements to make the payment to Mr. Jereis 22 through Mr. Khader. 23 Q. Did you in fact -- was a meeting arranged? 24 A. Yes, it was. 25 Q. And who was present? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1623 C31Qann3 Mangone - Direct 1 A. It was at Mr. Khader's home. It was myself, Zehy and 2 Mr. Khader. 3 Q. Where was Mr. Khader's home? 4 A. Around the corner from my house and Zehy's house in 5 Yonkers. 6 Q. Approximately when did this meeting occur? 7 A. Sometime around July 12. 8 Q. Of what year? 9 A. 2006. 10 Q. Did you in fact make a cash payment that day? 11 A. Yes, I did. 12 Q. Who did you hand the money to? 13 A. Mr. Khader directly. 14 Q. Who was present when you handed the cash to Mr. Khader? 15 A. Myself, Zehy and Mr. Khader. 16 Q. How much cash did you give him? 17 A. $5,000. 18 Q. How much had you received -- maybe not at this point -- but 19 how much money had you received or how much was the bribe 20 supposed to be? 21 A. It was supposed to be for 10,000. 22 Q. What did you do with the rest of the money? 23 A. I never gave him the other payment. 24 Q. When you say you didn't give him the rest of the payment, 25 what happened to the rest of the money? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1624 C31Qann3 Mangone - Direct 1 A. Well, he had already decided not to run, so I kept the 2 money in my firm account. 3 Q. Whose senate district is the Ridge Hill project in? 4 A. Senator Spano's. 5 Q. What is your relationship with Al Pirro? 6 A. I've known him as a social acquaintance and professional 7 for approximately eleven years. 8 Q. Directing your attention to December of 2004, what, if any, 9 discussions did you have with Zehy Jereis during this time 10 period about the Ridge Hill project? 11 A. Right after a holiday party that I hosted that Zehy had 12 attended, he came to me and asked if I would call Mr. Pirro 13 about getting him a job as a consultant for the Ridge Hill 14 project. 15 Q. Did you do that? 16 A. Yes, I did. 17 Q. Were you successful in helping Zehy Jereis get a consulting 18 contract with Forest City Ratner? 19 A. No, Mr. Pirro refused. 20 Q. Now I want to ask you some questions about the Longfellow 21 project. 22 Directing your attention now to April of 2006, did 23 there come a time when you were introduced to Franco Milio? 24 A. Yes. 25 Q. Who introduced you? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1625 C31Qann3 Mangone - Direct 1 A. My wife's uncle. 2 Q. Who is that? 3 A. Joe Guarniero. 4 Q. Approximately when did you meet? 5 A. It was Good Friday 2006. 6 Q. Do you recall the exact date? 7 A. I know it was Good Friday. 8 Q. Where did the meeting take place? 9 A. At a restaurant on Lockwood Avenue known as Reno's. 10 Q. Who was present? 11 A. It was myself, Joe Guarniero, Franco Milio, his cousin, 12 Romeo Milio, and his cousin, Dominick Miano. 13 Q. Was the subject of the Longfellow project discussed at the 14 meeting? 15 A. Yes, it was. 16 Q. What, if anything, did the Milios tell you about the 17 project? 18 A. They told me that the project had been, I guess, held up in 19 the real estate committee for a period of time, and that they 20 had felt that the project was being held up by Councilwoman 21 Annabi. 22 Q. What, if any, understanding do you have about why 23 Councilwoman Annabi's vote was important on the Longfellow 24 project? 25 A. It's a small project in terms of what goes on in terms of SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1626 C31Qann3 Mangone - Direct 1 developing projects in Yonkers. It was a -- if a project was 2 in her district, out of deference to that particular council 3 member, they won't take the project out of the committee until 4 the council member is comfortable with how the project will 5 progress. 6 Q. And when you say "they," you mean the other council 7 members? 8 A. Yes. 9 Q. Is that a tradition where other council members defer to 10 the council member whose district the project is in? 11 A. Yes. 12 Q. What, if anything, did you say to the Milios at that 13 meeting about the Longfellow project? 14 A. That, you know, perhaps I could be helpful in getting 15 Ms. Annabi to change her position. 16 Q. By the way, have you ever met Antonio Milio? 17 A. Yes. 18 Q. Have you spoken with him? 19 A. Many times. 20 Q. Approximately -- do you know what his first language is? 21 A. I believe it's Italian. 22 Q. Can you describe his ability to speak and understand the 23 English language? 24 A. I believe he understands it, but he's got -- he speaks with 25 a broken English. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1627 C31Qann3 Mangone - Direct 1 Q. Did you characterize at the meeting at Reno's how you 2 thought the Milios were being treated by Sandy Annabi? 3 A. Yeah, I -- yes. 4 Q. What, if anything, did you say? 5 A. It sounded like she had been, you know, screwing them 6 around, keeping the project held up. 7 Q. After the meeting at Reno's, what did you do? 8 A. I arranged for them to come to my office for a meeting. 9 Q. Approximately when did that meeting occur? 10 A. Sometime in late April. 11 Q. Who scheduled the meeting? 12 A. Franco, I believe, called and he arranged for the meeting. 13 Q. Who was present at the meeting? 14 A. It was myself, Franco, Zehy Jereis and Dominick Miano. 15 Q. Who invited Zehy Jereis to the meeting? 16 A. I did. 17 Q. Why did you invite Zehy Jereis to the meeting? 18 A. To have someone there to help, one, to show the client that 19 I was bringing someone who could perhaps influence her vote and 20 someone to also give us an insight on Ms. Annabi's view on the 21 project. 22 Q. Why didn't you call Sandy Annabi directly? 23 A. Because I just know Zehy to have access to her, and he 24 would be able to tell me what the issues were. 25 Q. Can you describe the substance of the discussions that took SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1628 C31Qann3 Mangone - Direct 1 place at the meeting? 2 A. Zehy had told my clients that he knew that they were having 3 a rough time, that they had some community opposition, 4 particularly from, I believe, a gentleman known as Steve 5 Kubicek and some priests in the area who were against the 6 project. 7 Q. How did you leave off the meeting? 8 A. That they wanted to go ahead and retain me. 9 Q. What, if anything, did Zehy Jereis say at the meeting on 10 the subject of whether he could be helpful? 11 A. He felt that provided they had made certain changes that he 12 could be helpful. 13 Q. What is a retainer agreement? 14 A. It's a contract between -- in my instance -- between my 15 firm and a client to engage our services. 16 Q. Did there come a time when you sent the Milios a retainer 17 agreement? 18 A. Yes. 19 Q. Please broadcast Government Exhibit 702 in evidence. 20 Please maximize the first paragraph. 21 Do you recall approximately when you sent this 22 retainer agreement to the Milios? 23 A. Sometime in late April, 2006. 24 Q. Was this after the meeting held in your office -- 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1629 C31Qann3 Mangone - Direct 1 Q. -- with Mr. Jereis and the Milios? 2 A. Yes, I'm sorry. 3 Q. Please read the text of the first paragraph. 4 A. "I am pleased that you have decided to retain this firm to 5 represent your company in connection with the development and 6 reconstruction of the former Longfellow School and School 6 in 7 the city of Yonkers. In consideration of the services 8 rendered, you have agreed to pay the firm of Santangelo 9 Randazzo & Mangone the monthly fee of $2,000. As further 10 consideration of our services, you have also agreed to pay the 11 firm a success fee of $20,000 upon the city council's approval 12 designating your company or its subsidiaries as developer of 13 the aforementioned sites. You agree this success fee shall be 14 due and payable to the firm within ten days of such city 15 council approval." 16 MR. CARBONE: For the record, your Honor, this 17 document is -- was introduced in evidence as Defense Exhibit 45 18 but it's also been marked as a Government Exhibit. 19 THE COURT: OK, it's defense 45 for now. 20 Q. Mr. Mangone, did you discuss the terms of the agreement 21 with the Milios? 22 A. Yes, I did. 23 Q. Please broadcast the last page, the signature page. How 24 was this agreement signed? 25 A. By myself and Franco Milio. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1630 C31Qann3 Mangone - Direct 1 Q. Now, first paragraph referred to a success fee. What, if 2 anything, did you have to succeed at before you could get paid 3 the success fee? 4 A. They had to be designated as developers for the sites. 5 Q. Now, did the Milios initially agree to this arrangement? 6 A. Yes. 7 Q. Did there come a time when you sent them a second retainer 8 agreement? 9 A. Yes, I did. 10 Q. How did the terms of your engagement change? 11 A. This retainer agreement was limited solely to the 12 Longfellow school 6 project. They also wanted to retain me as 13 general counsel to their firm to handle all of their matters 14 related to real estate closings, problems that they had in 15 their buildings with respect to tenants, and of the like. 16 Q. What, if any, discussions did you have with the Milios on 17 the subject of whether you could work together with Al DelBello 18 on the project? 19 A. Shortly after I had sent out this retainer agreement, 20 Franco had called to tell me that when he discussed my coming 21 on board to represent him with Mr. DelBello, that Mr. DelBello 22 did not want me on the project. 23 Q. What, if any, discussions did you have with Zehy Jereis 24 after the meeting in your office? 25 A. Zehy had said that he had known that Al DelBello was -- had SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1631 C31Qann3 Mangone - Direct 1 heard that Al DelBello had charged them a lot of money and that 2 I should get a significant fee for representing them. 3 Q. What did you say? 4 A. I said the reason why they were coming to me in the first 5 place was that they didn't want to spend a lot of money on 6 legal fees because they wanted to get away from DelBello's 7 heavy prices. 8 Q. What, if any, trips did you take outside of the State of 9 New York in June of 2006? 10 A. I went to Florida with my family. 11 Q. Where did you stay? 12 A. The Breakers in Palm Beach. 13 Q. During approximately what time period did you go to 14 Florida? 15 A. June 21 through the 24th. 16 Q. What, if any, contact did you have with Franco Milio while 17 you were in Florida? 18 A. He contacted me while I was away on the trip, and called to 19 tell me that he had been at a real estate committee meeting and 20 once again had gotten shot down and wanted to make sure that I 21 took the lead in the case to get the approval. 22 Q. After speaking with Franco Milio, what, if anything, did 23 you do? 24 A. I contacted Mr. Jereis. 25 Q. What did you say to Mr. Jereis? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1632 C31Qann3 Mangone - Direct 1 A. That I would be coming on board in charge of the Longfellow 2 and School 6 approval. 3 Q. What happened next? 4 A. I returned from Florida, and I had a meeting with 5 Mr. Jereis. 6 Q. Where did that meeting take place? 7 A. At my office. 8 Q. Please describe the substance of your discussions with 9 Mr. Jereis at this meeting? 10 A. Zehy came to my office and said that he could be helpful 11 with bringing Ms. Annabi on board; then said that he needed 12 money; that Ms. Annabi had been hounding him for money, and he 13 needed money to get her on board. 14 Q. Did you discuss how much money he needed to get Ms. Annabi 15 on board? 16 A. Yes. 17 Q. What did he say? 18 A. At first he had suggested a hundred thousand. 19 Q. What, if anything, did you say when he suggested a hundred 20 thousand dollars? 21 A. I said it was never going to happen because they were only 22 paying me $2,000 a month and a $20,000 success fee. They were 23 never going to pay that kind of money. 24 Q. Did you reach any agreement during this discussion on the 25 amount of the bribe that would be paid to get the project SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1633 C31Qann3 Mangone - Direct 1 approved? 2 A. I said that I would bring forward the same amount of money, 3 $20,000. 4 Q. What, if anything, did Zehy Jereis say he would do in 5 return for the $20,000? 6 A. Get Ms. Annabi to vote for the project. 7 Q. Did he say how he wanted it paid? 8 A. No. 9 Q. During this conversation, did you discuss the subject of 10 Sandy Annabi's upcoming trip to Jordan? 11 A. Yes. 12 Q. What, if anything, did he say? 13 A. Mr. Jereis had said that she was hounding him for money; 14 that she was going to Jordan; and that he needed the money. 15 Q. Why did you contact Zehy Jereis instead of going directly 16 to Sandy Annabi? 17 A. Because I knew Zehy to just have access to her and be able 18 to influence her. 19 Q. What was your understanding about what form the payment 20 would take? 21 A. In cash. 22 Q. I'm sorry, what did you do after you spoke with Mr. Jereis? 23 A. I contacted Franco Milio. 24 Q. Did Mr. Milio ultimately agree to pay the bribe? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1634 C31Qann3 Mangone - Direct 1 Q. Directing your attention to July 10 of 2006, did you have 2 any discussions on that day with Zehy Jereis? 3 A. Yes, I did. 4 Q. What did he say to you? 5 A. He had called me to tell me the conditions in which the 6 project would be approved. 7 Q. What did you say to him? 8 A. I said I would refer them -- relay them over to my client. 9 Q. What, if anything, did you do when you received this phone 10 call from Mr. Jereis? 11 A. I sent an email to Franco Milio telling him what the 12 conditions were. 13 Q. Please broadcast Government Exhibit 700 in evidence. 14 Mr. Mangone, what time of day did you send this email 15 to Franco Milio? 16 A. 4:20 in the afternoon. 17 Q. Would you please, Mr. Turk, maximize paragraphs -- starting 18 with "here are the conditions." 19 Now, when did you write this email? 20 A. On July 10. 21 Q. What were you doing at the time you wrote it? 22 A. I was speaking to Mr. Jereis. 23 Q. In person or on the phone? 24 A. On the phone. 25 Q. Can you please read the three conditions? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1635 C31Qann3 Mangone - Direct 1 A. Number (1) was 20 percent of the units will be offered at 2 below market rent housing. 3 (2) the city counsel will have an independent 4 appraisal conducted. Those results will not affect the 5 approval which will happen tomorrow. The appraisal is being 6 done for her own selfish political gain so that when people in 7 her district ask if she conducted one as she said she would, 8 then she has cover. 9 Number (3) the applicant will advertise for a period 10 of six months the availability of housing for senior citizens. 11 The applicant will further work with the second district 12 council member in accepting recommendations for consideration 13 of seniors her office comes in contact with for housing. 14 Q. What, if any, discussions did you have with Zehy Jereis on 15 the subject of when the project would be voted on and approved? 16 A. During that particular phone call, Zehy had said that it 17 would be put on at a meeting for city council which was taking 18 place in Saunders the next evening. 19 Q. What happened the next evening? 20 A. The next evening the matter came out of the real estate 21 committee where it had been holed up for some time, but it 22 didn't actually get on to the agenda for approval because they 23 did not have all seven council members unanimous in allowing it 24 to get on to the agenda. 25 Q. What, if any, discussions did you have with Zehy Jereis on SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1636 C31Qann3 Mangone - Direct 1 that day on the subject of the time of the vote? 2 A. He had told me that Mr. Murtagh and Ms. Barbato, both 3 council members, had refused to allow it to go on to the agenda 4 because as a quasi-payback to Ms. Annabi for voting for Ridge 5 Hill. 6 Q. Now, after the meeting, what, if any, discussions did you 7 have with Zehy Jereis about the vote? 8 A. Zehy had contacted me either that evening or early the next 9 day saying that they had delivered -- that the project was 10 ready to be voted on and approved but for Murtagh and Barbato 11 holding it up, and as a result, they deserved a payments. 12 Q. What do you mean when you say "they." 13 A. I didn't ask him who they was, but certainly he and the 14 money to influence Ms. Annabi. 15 Q. What, if any, concern did you express to Mr. Jereis on the 16 subject of whether he should be paid before the project was 17 voted on? 18 A. I expressed concern that if the project had not been voted 19 on, I would be hard-pressed to go to my client and ask him to 20 come up with money for the approval when the project had not 21 yet been approved. 22 Q. What, if any concern did Mr. Jereis express to you? 23 A. His concern was that, again, that they would get screwed if 24 my client didn't pay now, he didn't need us any more. 25 Q. Did you convey Mr. Jereis's demand for the cash to the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1637 C31Qann3 Mangone - Direct 1 Milios? 2 A. Yes, I did. 3 Q. What happened next? 4 A. Franco questioned why would we pay if the project had not 5 been actually voted on. And I said as a gesture of good faith 6 perhaps we could come up with some money to show that we were 7 on board and that we weren't going to renege on our obligation. 8 Q. And how much money did you then receive and give to 9 Mr. Jereis? 10 A. $10,000. 11 Q. Where did you receive the $10,000? 12 A. At my office. 13 Q. Who did you receive it from? 14 A. Antonio Milio. 15 Q. What did you do after you received the cash from Antonio 16 Milio? 17 A. I contacted Zehy to tell him that I had the payment, and I 18 made arrangements to meet with him. 19 Q. Did you meet with him that evening? 20 A. Yes. 21 Q. Where were you when you met with him? 22 A. I was at Trotter's. 23 Q. What is Trotter's? 24 A. Trotter's is a restaurant in White Plains. It's no longer 25 there any more. It's on Main Street in White Plains. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1638 C31Qann3 Mangone - Direct 1 Q. Who were you there with? 2 A. Friends. 3 Q. How did you know that Mr. Jereis arrived? 4 A. He contacted me when he was outside the restaurant and said 5 he was outside. 6 Q. When you say contacted you, how did he contact you? 7 A. He called me on my cell phone. 8 Q. What did you do after you received a call from Mr. Jereis? 9 A. I went outside, went into his car and gave him the money. 10 Q. What kind of car was he driving? 11 A. A white Mercedes. 12 Q. And you said you got into the car? 13 A. Yes, I did. 14 Q. What, if anything, did Mr. Jereis say when you handed him 15 the cash? 16 A. He reiterated once again that he hoped that they weren't 17 going to get screwed on the remaining payment. 18 Q. Approximately how long were you in the car with him? 19 A. Not even a minute. I had people inside. 20 Q. What did you do after you gave him the cash? 21 A. I said -- I left. I got out of the car and went back 22 inside. 23 Q. Mr. Mangone, please take a look at Government Exhibit 775 24 in front of you for identification. Did you pay for the dinner 25 that night at Trotter's? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1639 C31Qann3 Mangone - Direct 1 A. Yes, I did. 2 Q. What is Government Exhibit 775? 3 A. It's a copy of an American Express statement. 4 Q. Whose American Express statement? 5 A. It's the whole firm's. 6 Q. It's the American Express statement maintained in the 7 ordinary course of the firm's business? 8 A. Yes. 9 MR. CARBONE: Your Honor, I offer Government Exhibit 10 775 in evidence. 11 MR. ARONWALD: No objection. 12 MR. SIANO: No objection. 13 THE COURT: Admitted. 14 (Government's Exhibit 775 received in evidence) 15 Q. Please maximize page 2 and highlight the entry on 7/13/06. 16 Can you read the date and amount of the charge? 17 A. 7/13/06, Trotter's Tavern, White Plains, New York, and it 18 gives a charge of $327.78. 19 Q. Thank you, Mr. Turk. 20 What, if any, discussions did you have with Zehy 21 Jereis about the subject of whether the project would be put on 22 the agenda over the summer? 23 A. Franco wanted to fast track the project at that point, and 24 I contacted Zehy to see if there was any way we could get a 25 special council meeting. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1640 C31Qann3 Mangone - Direct 1 Q. Does the city council meet in the summer months? 2 A. Typically I don't believe so. 3 Q. Were you able to arrange a special council meeting? 4 A. No, I was not. 5 Q. When did the city council actually vote to approve the 6 project? 7 A. September 26 of 2006. 8 Q. Why did it take so long? 9 A. Because there were no meetings during the summer, and by 10 the time the next council meeting met, I believe there was a 11 work session in early September and then a meeting thereafter. 12 Q. What, if anything, occurred on September 26 of 2006? 13 A. The resolution was voted on to designate Milio as the 14 developer. 15 Q. What, if any, discussions did you have with Zehy Jereis 16 after the council voted to approve the project? 17 A. I believe he called me that evening or the next morning and 18 asked about the rest of the payment. 19 Q. What, if anything, did he say? 20 A. The project had been approved and when could we get 21 together. 22 Q. Did you in fact get together and make any additional 23 payments to Zehy Jereis to give to Sandy Annabi? 24 A. Yes, I did. 25 Q. When did the payment occur? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1641 C31Qann3 Mangone - Direct 1 A. The next day. 2 Q. Where did you get the money from? 3 A. The Milio family had come to my office to bring the 4 remaining balance. 5 Q. Approximately when did that happen? 6 A. September 27, 2006. 7 Q. Do you recall exactly where you paid him? 8 A. I do not. 9 Q. What else, if anything, happened on the day of the payment? 10 A. On that particular day my firm was dealing with a highly, 11 highly sensitive public relations issue that I was handling for 12 that day and for the days to follow. 13 Q. Were you present on either occasion when Zehy Jereis passed 14 the cash to Sandy Annabi? 15 A. No, I was not. 16 Q. Directing your attention to the summer of 2006 -- 17 MR. HALPERIN: Judge, is this a good time for a break? 18 THE COURT: I was going to say, we ordered the jurors 19 lunch for 12:30, and since we are going to break early today is 20 this a good time for breaking point. 21 MR. CARBONE: Yes, it is. 22 THE COURT: 45 minutes. You can run around and 22 stretch. Your lunch is back there, I assume, in the jury room. 23 Don't discuss the case. Keep an open mind. I will see you in 23 exactly 45 minutes. You're not leaving and I'm not leaving. 24 25 (Luncheon recess) SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1642 C31UANN4 1 A F T E R N O O N S E S S I O N 2 1:25 p.m. 3 (In open court, jury not present) 4 THE COURT: Where is Mr. Mangone? 5 THE DEPUTY CLERK: Judge, the parties have something. 6 MR. SIANO: Judge, I wanted to ask the Court to 7 consider -- 8 THE COURT: You don't have to stand when Mr. Siano is 9 speaking. 10 MR. SIANO: I don't even want to stand when I am 11 speaking. 12 THE COURT: I'll bet you do. 13 MR. SIANO: I have learned that lesson well. 14 Judge, I want to hand up to the Court for the Court's 15 consideration, in the Matter of Kourland, 172 AD2d 77, 577 16 N.Y.S.2d. 264, (1st Dept. 1991) and ask the Court to consider 17 instructing the jury that the law in New York is that 18 disbarment proceedings against a lawyer for felony conviction 19 are automatic upon entry of plea rather than final conviction. 20 THE COURT: Do you think the jurors -- 21 MR. SIANO: This will become factually relevant during 22 my cross, Judge, and I just wanted to give the Court time to 23 look at it. 24 THE COURT: Fine. You ask your question during your 25 cross. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1643 C31UANN4 1 I will instruct the jurors on the law at the end the 2 case. I doubt that that will be part of the charge. 3 MR. HALPERIN: Should we bring the witness in, Judge? 4 THE COURT: Yes. 5 6 (Continued on next page) 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1644 C31UANN4 Mangone - direct 1 (Jury present) 2 THE COURT: We are back. 3 You are still under oath. 4 And you are up, Mr. Carbone. 5 ANTHONY MANGONE, resumed. 6 DIRECT EXAMINATION (Continued) 7 BY MR. CARBONE: 8 Q. Mr. Mangone, directing your attention back to the time of 9 the first cash payment made to Mr. Jereis. During your 10 discussions with Mr. Jereis in June and July, what if anything 11 did he say on the subject of why Sandy Annabi needed the money? 12 A. Because she was going to Jordan. 13 Q. How did you learn that she was going to Jordan? 14 A. From Mr. Jereis. 15 Q. Fast forwarding to the September 26 vote and the second 16 payment that you made to Mr. Jereis, how is it that you 17 actually got the cash to give to Mr. Jereis? 18 A. Franco Milio had come to my office with his cousin Romeo 19 and his uncle Joe and his other cousin Dominick and brought 20 20,000 in cash, and at that point I commented that this wasn't 21 enough, that there was another $10,000, that 20 was for my 22 success fee and the $10,000 that they needed for me to give to 23 Zehy. His dad later came back that day, Antonio, and dropped 24 the payment off to my office. 25 Q. How did you get the payment? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1645 C31UANN4 Mangone - direct 1 A. It was in my drawer. 2 Q. Directing your attention to the summer of 2006 -- just to 3 clarify, between the first payment and the second payment, how 4 much total cash did you give to Zehy Jereis to give to Sandy 5 Annabi? 6 A. 20,000. 7 Q. And how much did you get from the Milios, total? 8 A. Total cash? 9 Q. Yes. 10 A. 40,000. 11 Q. 20,000 for them and 20,000 for you? 12 A. Yes. Plus they made the additional 2,000 dollar-a-month 13 payments pursuant to the retainer agreement. 14 Q. Were you providing other legal services at the time? 15 A. During that period of time, yes. 16 Q. Now, directing your attention to the summer of 2006 -- 17 A. Yes. 18 Q. -- after Sandy Annabi had agreed to vote in favor of the 19 Longfellow project, what if any role did you have in connection 20 with negotiating the final details of the resolution? 21 A. I worked with Franco. I spoke with Zehy and also worked 22 with the Corporation Counsel's office. 23 Q. What do you mean by Corporation Counsel? 24 A. The City of Yonkers has a Corporation Counsel's office that 25 assists in drafting -- in this particular instance, it was a SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1646 C31UANN4 Mangone - direct 1 gentleman by the name -- 2 THE COURT: What is the Corporation Counsel? I think 3 that's the question. That is a term for -- who is the 4 Corporation Counsel? What does that person do? 5 THE WITNESS: They represent the City of Yonkers. 6 THE COURT: It is the lawyer for the City of Yonkers, 7 right? 8 THE WITNESS: Yes. 9 BY MR. CARBONE: 10 Q. Who in the Corporation Counsel's office were you dealing 11 with? 12 A. Joe Madden. 13 Q. And what is the Corporation Counsel's role in drafting the 14 resolution? 15 A. They assist the council in drafting resolutions. 16 Q. And what was your role in drafting the resolution for the 17 Longfellow project? 18 A. Just input, just to make sure we met the one that I 19 satisfied my client, but the two that we made sure that the 20 stipulations were in there to the satisfaction of Ms. Annabi. 21 Q. Will you please look at Government Exhibit 778 that's been 22 marked for identification in front of you? 23 A. Yes. 24 Q. What is Government Exhibit 778? 25 A. It is an email from myself to Franco Milio. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1647 C31UANN4 Mangone - direct 1 Q. Were you responding to an email that Franco Milio had 2 written to you? 3 A. Yes. 4 Q. What is the date of the email? 5 A. August 10, 2006. 6 Q. Does your law firm keep emails in the regular course of its 7 business? 8 A. Yes. 9 MR. CARBONE: Your Honor, the government offers 10 Exhibit 778 in evidence. 11 THE COURT: Any objection? 12 MR. SIANO: We need a moment, Judge. 13 MR. ARONWALD: Could we just have a moment, your 14 Honor? 15 MR. SIANO: May I consult with Mr. Carbone? 16 THE COURT: I'm sorry? 17 MR. SIANO: May I consult with Mr. Carbone for a 18 second? 19 THE COURT: You may. 20 (Discussion off the record between counsel) 21 MR. SIANO: No objection, your Honor. 22 MR. ARONWALD: No objection. 23 THE COURT: Admitted. 24 (Government Exhibit 778 received in evidence) 25 MR. CARBONE: Mr. Turk, can you please broadcast SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1648 C31UANN4 Mangone - direct 1 Government Exhibit 778. 2 BY MR. CARBONE: 3 Q. Mr. Mangone, can you describe the substance of the email 4 that Mr. Milio sent to you? 5 A. It was a proposed email to Ms. Annabi's office and her 6 assistant discussing the layout of the Longfellow apartments 7 and how they would be marketed. 8 Q. What is the date and time of the email? 9 A. August 10, 2006 at 9:10 a.m. 10 Q. What is the subject line? 11 A. It says: "Longfellow, please review." And then that 12 portion is a little bit of a redaction on it, but above -- 13 MR. CARBONE: Yes, your Honor, there are some 14 irrelevant handwritten notes on the document that was redacted. 15 THE COURT: Yes. We redacted. You all know what that 16 means; there is some stuff on there that you don't need to see. 17 MR. CARBONE: Mr. Turk, would you please broadcast 18 side by side, Defense Exhibit 44 and Government Exhibit 778. 19 BY MR. CARBONE: 20 Q. Mr. Mangone, can you see in front of you Defense Exhibit 21 44? 22 A. Yes. 23 Q. Defense Exhibit 44, on the bottom it says from Franco Milio 24 and what is the time of that email? 25 A. 1:03 p.m. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1649 C31UANN4 Mangone - direct 1 Q. What is the date and time that Al DelBello responded to 2 Franco Milio's email? 3 A. 1:59 p.m. 4 Q. Now, referring to Government Exhibit 778, what time did 5 Franco Milio send you this email? 6 A. 9:10 a.m. 7 Q. Would you please read your response? 8 A. "I think under paragraph 4 you should include some 9 statement that your office will also welcome any advertising by 10 Councilwoman Annabi to promote seniors in her district for 11 occupancy. We will be happy to assist her in any such 12 advertising. Additionally, some language that we have been in 13 contact with MHA to review their rental guidelines, although 14 this will not qualify as an MHA building, we will use MHA 15 standards to satisfy the six units designated for less than 16 market rentals." 17 Q. How does the subject line differ from the email that 18 Mr. Milio sent to you as compared to what he sent to Al 19 DelBello? 20 A. It is just regarding Longfellow. It doesn't say please 21 review and advise if OK to send to Sandy and Debbie. 22 Q. And the one he sent you says what? 23 A. That's the one that he sent to me. On the one to 24 Mr. DelBello, he does not say please review and advise if OK to 25 send to Sandy and Debbie. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1650 C31UANN4 Mangone - direct 1 Q. Is there anything that is set forth in your response to 2 Franco Milio's email that is contained in the text of his email 3 to Al DelBello? 4 A. Yes. In the opening paragraph, it discusses the issues 5 that I had raised to him regarding the MHA guidelines and that 6 it is not going to qualify as MHA subsidized housing and less 7 than market rent apartments. 8 Q. Does the email that Mr. Milio sent to you, it differs from 9 the one he sent to Mr. DelBello? 10 A. Yes, it does. 11 Q. Does the one he sent to Mr. DelBello incorporate your 12 comments? 13 A. Yes, it does. 14 Q. 778, when you responded to Franco Milio's email, making 15 comments, why didn't you copy Al DelBello? 16 A. It didn't permit me to. He wasn't on the original email 17 chain. 18 Q. Were you talking to him during this time period? 19 A. No. 20 Q. How long after you sent your comments to Franco Milio about 21 this proposed email did he incorporate -- how much later did he 22 incorporate your comments and send it to Al DelBello? 23 A. It appears, some two hours later. 24 Q. Now, Mr. DelBello's email says, "I think you mean the HFA 25 not the MHA." Do you know what the HFA is? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1651 C31UANN4 Mangone - direct 1 A. No idea. 2 Q. What is the MFA? 3 A. Municipal Housing Authority. 4 Q. This email also said, "I was not aware that the deal 5 depended upon some affordable units." And the date of this is 6 August 10. Was that accurate? 7 A. No. 8 MR. CARBONE: Please broadcast Government Exhibit 700 9 again. 10 Q. Now, referring back to the email that you sent to Franco 11 Milio that you wrote while you were on the phone with Zehy 12 Jereis. Can you read condition number 1? 13 A. Yes. "20 percent of the units will be offered at below 14 market rent housing." 15 Q. Was that a condition of the resolution? 16 A. Yes, it was. 17 Q. What is the date of this email? 18 A. July 10, 2006. 19 Q. And that's a month before the email from Mr. DelBello? 20 A. Yes. 21 MR. CARBONE: Now, would you please broadcast 22 Government Exhibit 706, page 4, paragraph G which is the final 23 resolution which was passed by the city council on September 24 26, 2006. 25 Q. Can you read paragraph G? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1652 C31UANN4 Mangone - direct 1 A. "Not less than 20 percent of the residential units to be 2 constructed at the Longfellow property shall be affordable 3 housing units, to be marketed and occupied in accordance with 4 affordable housing rental and household income standards to be 5 formulated and incorporated in an agreement between the city 6 and the designated developer." 7 Q. Is that one of the multiple conditions that you 8 communicated to Franco Milio back on July 10th? 9 A. Yes. 10 Q. Did there come a time that you learned that Antonio Milio 11 had been contacted by the FBI? 12 A. Yes. 13 Q. What if any discussions did you have with Franco Milio on 14 the subject of whether he should hire a lawyer outside of your 15 firm to represent him? 16 A. I had told Franco that he should hire an attorney and not 17 discuss the issue with cash. 18 Q. Who did he hire? 19 A. Lawrence Diagiansante. 20 Q. Did you recommend Mr. Diagiansante? 21 A. Yes, I did. 22 Q. What in substance did you say to him when you told him not 23 to discuss the subject of cash? 24 A. Just that there was no need for anyone else to know about 25 the cash. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1653 C31UANN4 Mangone - direct 1 Q. When you said that, where did the meeting take place? 2 A. In the basement of my office. 3 Q. Can you describe that room? 4 A. It has a gym, a sauna, a wine room, a locker room, a hot 5 tub and an office. 6 Q. Was your law office located in an office building? 7 A. It was a building that we had purchased. 8 Q. And were those things in there when you purchased it? 9 A. Yes, it was. 10 Q. Did all of the tenants in the building have access to that 11 room in the basement? 12 A. Yes. 13 Q. Did you at any point provide Franco Milio with any advice 14 on how he should respond to grand jury subpoenas that he had 15 received? 16 A. Yes. 17 Q. What did you advise him to do? 18 A. I said, if they were overly broad, that he should speak to 19 his attorney about making a motion to quash. 20 Q. What is a motion to quash? 21 A. Essentially, it is to try and keep the individual who is 22 receiving the subpoena from producing certain documents. 23 Q. Is that a legal proceeding? 24 A. Yes. 25 Q. Did there come a point in time that you had discussions SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1654 C31UANN4 Mangone - direct 1 with Franco Milio after he had begun cooperating with the 2 government? 3 A. Yes. 4 Q. Approximately how many times did you meet with him? 5 A. Twice. 6 Q. Can you describe his demeanor when you met with him? 7 A. Shifty, fidgety, wouldn't make eye contact with me, very 8 pale. 9 Q. What if anything did you suspect about whether he had been 10 cooperating with the government? 11 A. I suspected that he was wearing a recording device. 12 Q. And during that meeting did he attempt to engage you in 13 conversation about the cash that he had given to you to give to 14 Sandy Annabi? 15 A. Yes. 16 Q. What if anything did you say? 17 A. I tried to steer him away from the discussion and told him 18 I didn't know what he was talking about, told him I never gave 19 cash to anyone. 20 Q. Was that true? 21 A. No. 22 Q. Why did you deny it? 23 A. I was concerned about my own well-being. 24 Q. Now, did there come a point in time when FBI agents came 25 and contacted you about the investigation? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1655 C31UANN4 Mangone - direct 1 A. Yes. 2 Q. Did you agree to be interviewed? 3 A. Yes. 4 Q. Did you agree initially to be interviewed? 5 A. Not initially, no. 6 Q. Then what happened? 7 A. My lawyer had discussions with the U.S. Attorney's office 8 and I eventually agreed to meet with them. 9 Q. Approximately when did the interview take place? 10 A. End of April of '08. 11 Q. Who were your law partners during this time period? 12 A. Michael Santangelo. 13 Q. Did you have any discussions with Michael Santangelo about 14 what you were going to say about the nature of the payments? 15 A. Yes. 16 Q. What did you say? 17 A. I told them that I was simply going to say that the money 18 given to Zehy was a consulting fee. 19 Q. Was that true? 20 A. No. 21 Q. Who is Pat Stiso? 22 A. He was a business associate. 23 Q. Did you have any discussions with Pat Stiso before you came 24 in for an interview? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1656 C31UANN4 Mangone - direct 1 Q. What if anything did you say to Pat Stiso about the nature 2 of the payment that you made to Zehy Jereis? 3 A. I told them that if they asked me the question, that I was 4 going to tell them that the payment to Zehy was a consulting 5 fee. 6 Q. Were you interviewed by the FBI eventually? 7 A. Yes. 8 Q. And that took place in the U.S. Attorney's office? 9 A. Yes. 10 Q. What if anything did you say on the subject of whether the 11 cash bribe that you gave to Zehy Jereis to give to Sandy Annabi 12 was a consulting fee? 13 A. I told them that I paid Zehy as a lobbyist. 14 Q. Was that true? 15 A. No. 16 Q. Approximately when did you begin to cooperate with the 17 government in this case? 18 A. I believe in March, late March 2010. 19 Q. Was that after you had been charged along with Ms. Annabi 20 and Mr. Jereis? 21 A. Yes. 22 Q. After you began cooperating, did you tell the FBI the true 23 circumstances surrounding the cash payments to Zehy Jereis? 24 MR. ARONWALD: Leading, your Honor. 25 THE COURT: Overruled. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1657 C31UANN4 Mangone - direct 1 A. Yes. 2 Q. What did you tell them? 3 A. That I had given money to Mr. Jereis to influence 4 Ms. Annabi's vote. 5 MR. CARBONE: Can I have a moment, your Honor? 6 THE COURT: Yes. 7 MR. CARBONE: No further questions. 8 Thank you. 9 MR. SIANO: I think I am going first, your Honor. 10 THE COURT: OK, Mr. Siano. 11 MR. SIANO: Thank you. 12 CROSS-EXAMINATION 13 BY MR. SIANO: 14 Q. Good afternoon, Mr. Mangone. 15 My name is Anthony Siano. 16 I represent Zehy Jereis. 17 A. Good afternoon. 18 Q. Mr. Mangone, the government placed in front of you your 19 cooperation agreement under which you are testifying here 20 today. Do you recall seeing that document? 21 A. Yes, I do. 22 Q. That's not the first time you ever saw a cooperation 23 agreement, is it, Mr. Mangone? 24 A. No. 25 Q. In fact, back in the year 2001 into 2002, you entered into SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1658 C31UANN4 Mangone - cross 1 a cooperation agreement with another prosecutor's office, isn't 2 that right? 3 A. Yes. 4 Q. You entered into a cooperation agreement with the 5 Westchester County District Attorney's office, isn't that 6 right? 7 A. Yes. 8 Q. At the time that you entered into that agreement, had you 9 just been admitted to practice law? 10 A. I don't recall. 11 Q. Do you recall testifying in the grand jury? 12 A. Yes. 13 Q. In the same matter? 14 A. Yes. 15 Q. You did that in 2001? 16 A. Yes. 17 Q. And do you recall that grand jury, telling them that you 18 were awaiting admission? 19 A. I told them that I had passed the bar. 20 Q. You told them that you had passed the bar. 21 In fact you attended St. John's law school, wasn't 22 that right? 23 A. Yes. 24 Q. When you went to St. John's law school, I believe you took 25 a course in criminal law? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1659 C31UANN4 Mangone - cross 1 A. Yes. 2 Q. You took a course in something called professional 3 responsibility and ethics? 4 A. Yes. 5 Q. And then you took the New York bar exam and passed, is that 6 correct? 7 A. Yes. 8 Q. Then you took the oath of office as an attorney? 9 A. Yes. 10 Q. And that oath required you to support and defend and uphold 11 the laws of the United States and the State of New York, isn't 12 that right? 13 A. Yes. 14 Q. And you recall being admitted in fact at some point in 15 2001? 16 A. Yes. 17 Q. You testified at trial in the Wedra matter in 2002, isn't 18 that right? 19 A. Yes. 20 Q. And may I ask you, sir, while you were attending St. John's 21 law school, did the professors there communicate to you the 22 concept that lying under oath was a bad thing for someone to 23 do? 24 A. Yes. 25 Q. While you attended St. John's law school, did they SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1660 C31UANN4 Mangone - cross 1 communicate to you that stealing was a bad thing to do? 2 A. Yes. 3 Q. And did they communicate to you, sir, that using client's 4 money, escrow or trust funds for personal reasons was also a 5 bad thing to do? 6 A. Yes. 7 Q. So then when you finally got in the courtroom in the trial 8 in the Wedra matter, you were well aware of all of these 9 things, isn't that correct? 10 A. Yes. 11 Q. You had already testified a year or so earlier in the grand 12 jury at Westchester County, isn't that correct? 13 A. Yes. 14 Q. And when you went in that grand jury, you raised your hand 15 and took an oath to tell the truth very similar to the oath you 16 took today, isn't that right? 17 A. Yes. 18 Q. And you lied to those grand jurors, didn't you? 19 A. Yes. 20 Q. And you lied to those grand jurors for a particular 21 purpose, isn't that correct, Mr. Mangone? 22 A. Yes. 23 Q. You lied to those grand jurors in order to protect your 24 political patron Nick Spano, isn't that right? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1661 C31UANN4 Mangone - cross 1 Q. You also lied about the specifics of how many absentee 2 ballots you had voted, isn't that correct? 3 A. No. 4 Q. Did you tell the grand jury all the absentee ballots you 5 voted were people you knew? 6 A. I don't recall. 7 Q. At trial did you tell the jury at trial that there were 8 absentee ballots you voted of people that you didn't know? 9 A. Yes. 10 Q. Now, in the grand jury, you were specifically asked if 11 Mr. Spano had any knowledge of the alteration or the fraudulent 12 voting of absentee ballots. Do you recall being asked about 13 that? 14 A. Yes. 15 Q. And you falsely denied that, didn't you? 16 A. Yes. 17 Q. Then you came out of that grand jury appearance and you 18 were offered a plea and cooperation agreement, isn't that 19 right? 20 A. I don't recall the timing. 21 Q. Well, you were offered the opportunity to plead to a 22 misdemeanor, isn't that correct? 23 A. Yes. 24 Q. And Mr. Wedra, the person with whom you had engaged in the 25 conduct that you were asked about, Mr. Wedra was tried for SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1662 C31UANN4 Mangone - cross 1 several felonies, isn't that right? 2 A. Yes. 3 Q. And you testified as a government witness with a 4 cooperation agreement; did you, sir? 5 A. No. 6 Q. Are you testifying here under oath, sir, today that you did 7 not testify in the trial of Dennis Wedra pursuant to a 8 cooperation agreement with the Westchester District Attorney's 9 office? 10 A. Yes. 11 Q. Mr. Mangone, do you recall testifying in the trial of 12 Dennis Wedra and being asked the following questions and giving 13 the following answers, sir? 14 MR. SIANO: And for the prosecutors here, Judge, 80106 15 Bates number trial transcript page 59, beginning at line 17. 16 And I will wait until the prosecutors are ready, Judge. 17 MR. CARBONE: Excuse me. May I have a moment, your 18 Honor? 19 THE COURT: Yes. 20 (Discussion off the record between counsel) 21 BY MR. SIANO: 22 Q. Do you recall being asked these questions and giving these 23 answers, sir, page 59, 17: 24 "Q Mr. Mangone, did there come a time when you reached 25 agreement with the Westchester County District Attorney's SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1663 C31UANN4 Mangone - cross 1 office concerning your role in this investigation? 2 "A Yes. 3 "Q I want to show you a document, two documents previously 4 marked as People's Exhibit 113 for identification and 114 for 5 identification and ask if you can tell us what they are? 6 "A The first one, 114 appears to be an agreement that I had 7 to go in and discuss my role in the process. 8 "Q Is that your signature? 9 "A Yes, it is at the bottom. 10 "Q And the second document is your signature on the second 11 document? 12 "A Yes, it is. 13 "Q And what was that? 14 "A This is the agreement that I entered into with the 15 Westchester County District Attorney's office in exchange for 16 my testimony before the grand jury and any other juries after 17 that." 18 Do you recall being asked those questions and giving 19 those answers, sir? 20 A. Yes. 21 Q. In fact, sir, you testified in the Dennis Wedra trial 22 pursuant to a written agreement with the Westchester County 23 District Attorney's office, isn't that correct? 24 A. There was an agreement, yes. 25 Q. And you signed it? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1664 C31UANN4 Mangone - cross 1 A. Yes. 2 Q. And you testified? 3 A. Yes. 4 Q. And in return for that agreement you were allowed to plead 5 guilty to a misdemeanor, isn't that correct? 6 A. Pursuant to that agreement. 7 Q. And that agreement called for you to give truthful 8 testimony in front of a trial jury in Westchester County in the 9 year 2002, isn't that correct? 10 A. Yes. 11 Q. And you knew that from your education, from your training 12 and from the fact that you read the documents before you signed 13 them, isn't that correct? 14 A. Yes. 15 Q. And you went in before that trial jury and lied, didn't 16 you? 17 A. Yes. 18 Q. And you did it because it was in your best interests, isn't 19 that right? 20 A. Yes. 21 Q. And you did it because you were protecting your political 22 benefactor Nick Spano, isn't that right? 23 A. Yes. 24 Q. And you came to some understanding as to what would happen 25 to you in the political arena vis-a-vis that testimony, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1665 C31UANN4 Mangone - cross 1 separate and apart from that written agreement with the 2 Westchester County District Attorney's office, didn't you, Mr. 3 Mangone? 4 A. I don't understand the question. 5 Q. Well, didn't you have a conversation with certain other 6 individuals regarding what would happen to you if you agreed to 7 take the misdemeanor? 8 MR. CARBONE: Objection. Hearsay. 9 THE COURT: Overruled. 10 A. Yes. 11 Q. Isn't it a fact, Mr. Mangone, that you sat down with 12 certain individuals and as a result of that conversation your 13 understanding was, if you took the deal and testified, you 14 would be able to go work at the law firm you subsequently 15 joined, isn't that right? 16 A. No, sir. 17 Q. Now, you testified against Mr. Wedra and perjured yourself, 18 isn't that correct? 19 A. Yes. 20 Q. And you were never prosecuted for perjury? 21 A. No, sir. 22 Q. Did you take the misdemeanor plea? 23 A. No, sir. 24 Q. After the trial was over, did you remain in your position 25 on Mr. Spano's staff? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1666 C31UANN4 Mangone - cross 1 A. Yes. 2 Q. Did there come a point in time, sir, shortly after the 3 Wedra trial when you left that position and went into private 4 practice? 5 A. I continued to stay on. 6 Q. Full-time? 7 A. Not full-time. 8 Q. Part-time? 9 A. That's correct. 10 Q. You had been on the staff full-time? 11 A. Not at the time of the trial. 12 Q. What law firm did you begin to work with after 2002, 13 Mr. Mangone? 14 A. Servino and Santangelo. 15 Q. The predecessor of the firm that you became a partner in, 16 isn't that right? 17 A. That's correct. 18 Q. Was the firm of Servino and Santangelo a topic of 19 conversation in the discussions you had with the political 20 personalities prior to your taking the misdemeanor plea? 21 A. I don't recall. 22 Q. Now, did you send out resumes in order to get the position 23 at Servino and Santangelo? 24 A. They recruited me. 25 Q. Is the answer to my question, sir, no? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1667 C31UANN4 Mangone - cross 1 A. No. 2 Q. That's correct, you didn't send out resumes. One of those 3 two individuals called you and told you that you could start at 4 the firm, isn't that right? 5 A. Yes, with a pay cut. 6 Q. Did I ask you about your salary, sir? 7 A. No, sir. 8 THE COURT: Just answer the questions that you are 9 asked, Mr. Mangone. 10 Q. If you don't understand my question, Mr. Mangone, would you 11 be kind enough to tell me? 12 A. Certainly. 13 Q. All right. Then after you received a phone call, you 14 started at the firm, isn't that correct? 15 A. Sometime thereafter. 16 Q. When you went to the firm, were there two partners without 17 you or were there three? 18 A. There were two and some associates. 19 Q. Two and some associates. 20 Now that we have cleared up the question as to whether 21 you testified pursuant to an agreement or not, I would like to 22 ask you some questions about what it was that you had actually 23 done that led to this plea agreement that you entered into. 24 Now, you were working for Mr. Spano in a primary in 25 the year 2000, isn't that right? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1668 C31UANN4 Mangone - cross 1 A. Yes. 2 Q. Not the Republican primary but a minor party primary? 3 A. Yes. 4 Q. And Mr. Spano very much desired to get his name on the 5 Green Party line, isn't that right? 6 A. Yes. 7 Q. And in order to do that, he had to go through a rather 8 complicated primary procedure, isn't that right? 9 A. Yes. 10 Q. And in an effort to facilitate his getting on the line in 11 the primary and gaining a win in the primary, you and Mr. Spano 12 engaged Dennis Wedra, isn't that right? 13 A. Yes. 14 Q. And Mr. Wedra was what we might call a political mercenary, 15 isn't that right? 16 A. Yes. 17 Q. He worked for money for many different parties, isn't that 18 correct? 19 A. Yes. 20 Q. And you and Mr. Spano sat down with Mr. Wedra and enlisted 21 him to gather names for petitions and names for ballots in a 22 permutation of a primary contest? 23 A. No. 24 Q. What did you do with Mr. Wedra? 25 A. Just for petitions. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1669 C31UANN4 Mangone - cross 1 Q. Just the petitions. 2 And you and Mr. Spano negotiated with Mr. Wedra about 3 price, isn't that right? 4 A. I don't recall the whole machinations. 5 Q. Mr. Wedra asked for $50,000, isn't that right? 6 A. He may have. I don't recall exactly. 7 Q. And you and Mr. Spano persuaded him that he should work for 8 $15,000? 9 A. I don't recall the exact machinations as to what happened. 10 Q. You agree that the number was $15,000 at the end of the 11 day? 12 A. Agreed. 13 Q. And at the end of the day it was also agreed that Mr. Spano 14 would not pay Mr. Wedra out of the Republican senatorial 15 committee treasury, would he? 16 MR. CARBONE: Judge, could we ask if Mr. Siano would 17 conduct his questioning from the lectern? 18 THE COURT: I would like that because I have pushed 19 him back repeatedly. It blocks my view of the jurors. 20 Q. You agreed with Mr. Spano and Mr. Wedra that the funds 21 would not be paid directly to Mr. Wedra from the Republican 22 senatorial committee, isn't that correct? 23 A. From his senate campaign committee. 24 Q. They wouldn't be paid directly to Mr. Wedra? 25 A. Correct. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1670 C31UANN4 Mangone - cross 1 Q. First, the money was funneled into, essentially, some sort 2 of Committee for Young Americans that was controlled by a 3 member of the Spano family, isn't that right? 4 A. They raised donations into that account. 5 Q. And that account was maintained under the name of a 6 treasurer who was, I believe, Mr. Spano's sister, is that 7 right? 8 A. Yes. 9 Q. And you and not Mr. Spano's sister had a series of signed 10 but blank checks at your disposal, isn't that right? 11 A. That's correct. 12 Q. And you took three of those checks and wrote them out for 13 $5,000 each, isn't that correct? 14 A. Yes. 15 Q. And you intended to use those checks to pay Mr. Wedra? 16 A. Yes. 17 Q. But you didn't write the checks to Dennis Wedra, did you? 18 A. No. 19 Q. You wrote the checks to some political action fund that 20 Mr. Wedra controls, isn't that right? 21 A. Yes. 22 Q. And as you told the grand jury and the trial jury, you did 23 this so that it would hide the flow of money from the public 24 and the press, isn't that right? 25 A. That's correct. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1671 C31UANN4 Mangone - cross 1 Q. And you also told the grand jury and the trial jury, you 2 didn't pay Dennis Wedra all at once, did you? 3 A. No. 4 Q. You wanted to make sure that you got what you were paying 5 for, didn't you? 6 A. That's correct. 7 Q. And Mr. Wedra brought you three dozen or so blank absentee 8 ballots and you voted those ballots? 9 A. I don't understand the question. 10 Q. One of the things Mr. Wedra did after you paid him the 11 first two payments was to bring you absentee ballots that real 12 citizens had signed but not voted, isn't that correct? 13 A. I think the time order is out of place. 14 Q. Didn't you make the last payment after the votes were cast? 15 A. No. 16 Q. When did you make the last payment? 17 A. I don't recall. 18 Q. You made the last payments when you got the ballots, isn't 19 that right? 20 A. No. 21 Q. Well, nevertheless, Mr. Wedra brought you the ballots and 22 you voted them? 23 A. That's correct. 24 Q. And you paid him the final progress payment at some point 25 in that process? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1672 C31UANN4 Mangone - cross 1 A. No. 2 Q. He didn't get his $15,000? 3 A. He got it before he gave us the ballots. 4 Q. Now, in fact Mr. Spano won the Green Party line, didn't he? 5 A. Yes. 6 Q. Now, after you joined the law firm, did it change its name? 7 A. A few times. 8 Q. A few times. So when we talk about the law firm, could we 9 call it SSR for simplicity's sake? 10 A. If that works for you. 11 Q. Well, Servino Santangelo and Randazzo, that was the name of 12 the firm, wasn't it? 13 A. Yes. 14 Q. There came a point in time where you became a member of the 15 firm, isn't that correct? 16 A. Yes. 17 Q. How long did that take after you joined the firm? 18 A. I want to say 2003. 19 Q. And you joined the firm in 2002? 20 A. Correct. 21 Q. And you had been a lawyer approximately a year and a half? 22 A. Yes. 23 Q. And you became a member of the firm? 24 A. Correct. 25 Q. That firm had some interesting ways of developing new SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1673 C31UANN4 Mangone - cross 1 business, isn't that right, Mr. Mangone? 2 A. I don't understand the question. 3 Q. Well, that firm had a contract to provide services for a 4 particular county in the Hudson Valley, isn't that right? 5 A. Yes. 6 Q. And that contract was for $450,000, isn't that right? 7 A. Somewhere around that. 8 Q. And your partners and you agreed to pay the person 9 responsible for the contract cash payments on a periodic basis 10 in return for the contract to provide legal services, isn't 11 that right? 12 A. Yes. 13 Q. And you and your partners cashed checks drawn on the firm, 14 brought back currency and stuffed it in envelopes, isn't that 15 right? 16 A. Yes. 17 Q. And then you sent somebody to make the payoffs, isn't that 18 right? 19 A. Yes. 20 Q. And on at least one occasion in connection with a 21 fundraiser, you made a cash payoff hand-to-hand yourself, isn't 22 that right? 23 A. That's correct. 24 Q. And from time to time you gave the payment to other members 25 of the firm to make these payoffs as well? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1674 C31UANN4 Mangone - cross 1 A. Yes. 2 Q. And you did this for the express purpose of insuring that 3 you would be able to get paid under this legal services 4 contract, isn't that right? 5 A. That's correct. 6 Q. That was taxpayer money, wasn't it? 7 A. Yes. 8 Q. In fact, as you told the FBI, nobody ever checked your 9 bills? 10 A. That's correct. 11 Q. Nobody ever questioned your bills? 12 A. That's correct. 13 Q. And would it be fair to say that the bills weren't always 14 100 percent accurate, were they? 15 A. Yes. 16 Q. Now, in addition to providing cash in return for this 17 contract, did there come a point in time where you provided a 18 position in your firm as part of the discussions involving this 19 contract? 20 A. I don't recall. 21 Q. Well, the state senator that had awarded you the contract 22 or caused the contract to be awarded to you, there came a point 23 in time where he came to you and the partners in your firm and 24 asked you to place an individual on your staff, isn't that 25 right? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1675 C31UANN4 Mangone - cross 1 A. I don't believe that's correct. 2 Q. Was it another state senator that asked you to put the 3 individual on your staff? 4 A. Yes. 5 Q. Ah. What did that other state senator provide to the firm 6 in return for your hiring an individual? 7 A. Nothing. 8 Q. What did he promise to provide to your firm? 9 A. That he would get some work for us. 10 Q. He said that he was going to get you so much work you would 11 need to add a wing to your firm, isn't that right? 12 A. Yes. 13 Q. And in return for that promise, you hired Matt Libous as an 14 associate, isn't that right? 15 A. That was one of the reasons. 16 Q. Did you hire Mr. Libous because of his brilliant legal 17 abilities? 18 A. It was one of the reasons. 19 Q. What was one of the reasons? 20 A. That he could get us some work. 21 Q. And then you found when Mr. Libous came, he told you what 22 he wanted to be paid, isn't that right? 23 A. What he needed to be paid. 24 Q. That's what he told you, what he needed to be paid? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1676 C31UANN4 Mangone - cross 1 Q. And your firm acquiesced? 2 A. Yes. 3 Q. And then you received a phone call from the senator telling 4 you to raise Matt Libous' salary, right? 5 A. Requested that if he could have some more money, yes. 6 Q. From 50,000 to 100,000, is that the request for some more 7 money that you just recited? 8 A. Yes. 9 Q. And you did it? 10 A. Yes. 11 Q. And then there came a point in time where the same 12 individual called you and asked you to raise Matt Libous' 13 salary to $150,000, isn't that right? 14 A. Yes. 15 Q. And that's when you and your partners complained, isn't 16 that right? 17 A. Yes. 18 Q. By that point, how long had Matt Libous been actually at 19 the firm? 20 A. A short period of time. 21 Q. I believe you told the FBI you determined rather quickly he 22 was incompetent, isn't that right? 23 A. I don't recall exactly. 24 Q. You don't recall exactly what you told the FBI? 25 A. Not exactly if he was incompetent or not. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1677 C31UANN4 Mangone - cross 1 Q. Well, you told the FBI generally that the firm of 2 Santangelo Randazzo and Mangone was dissatisfied with 3 Mr. Libous' performance, isn't that right? 4 A. At one point we became very dissatisfied. 5 6 (Continued on next page) 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1678 C31UANN4 Mangone - cross 1 CROSS-EXAMINATION 2 Q. Was that dissatisfaction due to his work? 3 A. Yes. 4 Q. He missed court appearances? 5 A. Yes. 6 Q. Nevertheless, you assigned Mr. Libous to the Milio 7 Management account, didn't you? 8 A. He worked on a number of projects. 9 Q. Did you tell the clients that Mr. Libous had a rather 10 limited skill set? 11 MR. CARBONE: Objection. Relevance. 12 THE COURT: Overruled. 13 A. If he had missed court, I didn't tell my clients that, no. 14 Q. Did you tell the Milios that the reason Matt Libous was on 15 the legal staff of Servino Santangelo Randazzo & Mangone was as 16 a payoff for the promise of work from a state senator? 17 MR. CARBONE: Objection. Misstates the testimony. 18 THE COURT: Overruled. If it does, he's certainly 19 capable of correcting Mr. Siano. 20 A. No. 21 Q. Did you tell anybody that? 22 A. No. 23 Q. Not until after you were indicted in this case, isn't that 24 right? 25 A. I didn't tell any clients after I was indicted -- SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1679 C31Qann5 Mangone - Cross 1 Q. No, you didn't tell anybody until after you were indicted 2 in this case. You told the government after you were indicted 3 about Mr. Libous, didn't you? 4 A. I don't recall if I told anybody before that. 5 Q. Nevertheless, you have been kind enough to inform me you 6 didn't tell any of the clients about the arrangement by which 7 Mr. Libous was working as a lawyer at your firm, isn't that 8 right? 9 A. No. 10 Q. Now, there came a point in time where -- was it you that 11 complained about the last $50,000 raise or was it one of your 12 partners? 13 A. One of my partners. 14 Q. Did you become aware of a particular additional arrangement 15 to cover the amount of salary Mr. Libous was to get between 16 $100,000 and $150,000? 17 A. Yes. 18 Q. And what was that arrangement as it was explained to you, 19 sir? 20 A. That he'd be doing some work for a lobbying firm that was 21 going to pay my firm. 22 Q. What was explained to you, sir, was that you were to bill 23 something called HIPAA Contracting for $50,000? 24 A. Yes. 25 Q. And that you could use that money to pay Matt Libous's SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1680 C31Qann5 Mangone - Cross 1 salary, isn't that right? 2 A. Yes. 3 Q. Did your firm ever do $50,000 worth of legal services for 4 HIPAA Contracting? 5 A. It wasn't my account. 6 Q. I asked did your firm ever do the work, sir? 7 A. I don't know the answer to the question. 8 Q. As far as you know, there was no work done; just a bill 9 sent, isn't that right? 10 A. I didn't stay on top of Mr. Libous to see what kind of work 11 he was doing. 12 Q. And you didn't stay on top of the HIPAA Contracting account 13 either, did you? 14 A. No. 15 Q. What you were concerned about was that Mr. Libous not cost 16 you more than a hundred thousand dollars, a Range Rover and a 17 credit card, isn't that right? 18 A. Correct. 19 Q. How long did this arrangement with Mr. Libous go on? 20 A. Approximately eight months. 21 Q. And he was let go because nobody delivered on the promise 22 of new business, isn't that right? 23 A. No, sir. 24 Q. Why was he let go? 25 A. We couldn't afford him any more. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1681 C31Qann5 Mangone - Cross 1 Q. I believe you testified in response to some questions from 2 Mr. Carbone that your firm received fee payments from clients 3 in cash, isn't that right? 4 A. That's correct. 5 Q. And it was a practice at your firm to take that cash and 6 divide it up among the lawyers, isn't that right? 7 A. Yes. 8 Q. Without it ever hitting the accounts receivable journal at 9 your firm, isn't that right? 10 A. Yes. 11 Q. In addition to that cash, your firm had something called 12 attorney trust accounts, is that right? 13 A. Yes. Yes. 14 Q. Were you responsible for any of those? 15 A. Yes. 16 Q. And an attorney trust account is, in essence, other 17 people's money, isn't that right? 18 A. Yes. 19 Q. And I take it while you were at St. John's you learned the 20 importance of being careful with such accounts? 21 A. Yes. 22 Q. Nevertheless, at your firm you wrote checks to yourself 23 directly from the attorney escrow account, isn't that right? 24 A. Yes. 25 Q. And you put that money in your personal bank account and SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1682 C31Qann5 Mangone - Cross 1 spent it, isn't that right? 2 A. Yes. 3 Q. I believe you also said in passing on direct that you used 4 some of these accounts to "cover markers at the casinos"? 5 THE COURT: Did you say that, sir? 6 A. I believe so, yes. 7 Q. And, in fact, that's what you did. 8 A. Yes. 9 Q. All right. I want to spend a little time talking about 10 your gambling activities -- 11 A. Yes. 12 Q. -- Mr. Mangone. Would that be all right? 13 A. Yes. 14 Q. You had a substantial gambling habit between 2004 and 2008, 15 isn't that right, Mr. Mangone? 16 A. That's correct. 17 Q. In fact, the year 2006, as you sit there now, was a 18 particularly active year for your gambling habit, isn't that 19 right? 20 A. Yes. 21 Q. Let's talk a little bit about your gambling. You went to a 22 number of casinos. I believe you gave us a number of different 23 geographic locations on direct. I'd like to ask you, sir, some 24 specific questions. You in fact gambled at the Tropicana Hotel 25 and Casino in Atlantic City? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1683 C31Qann5 Mangone - Cross 1 A. Yes. 2 Q. And at Caesars Boardwalk, Atlantic City? 3 A. Yes. 4 Q. And the Borgota Hotel and Casino, Atlantic City? 5 A. Yes. 6 Q. Mohegan Sun in Connecticut? 7 A. Yes. 8 Q. Harrah's in Atlantic City? 9 A. Yes. 10 Q. Caesars Palace in Las Vegas? 11 A. Yes. 12 Q. The Atlantis Casino in the Bahamas, isn't that right? 13 A. Yes. 14 Q. The Trump Taj Mahal, Atlantic City? 15 A. I don't remember that one. 16 Q. How about in Costa Rica, which casino did you stop at in 17 Costa Rica? 18 A. Some hotel that had a casino. 19 Q. How about in Puerto Rico, which casino or casino affiliated 20 with the hotel did you stop in there? 21 A. I think it was the Old Conquistador. 22 Q. Now, in the hotels other than in Costa Rica and Puerto 23 Rico, I want to concentrate our energies on Las Vegas, Atlantic 24 City and the Bahamas. At these particular institutions you 25 occasionally filled out an application for credit, isn't that SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1684 C31Qann5 Mangone - Cross 1 right? 2 A. That's correct. 3 Q. And on that application for credit, you gave them certain 4 biographical information and certain financial information, 5 isn't that right? 6 A. I believe so. 7 Q. And you know from your experience over the years that one 8 of the ways in which each casino sets your credit limit is by 9 your play, isn't that right? 10 A. Yes. 11 Q. So the more you play, the higher the credit limit, isn't 12 that right? 13 A. I believe so. 14 Q. Well, you know that from experience, isn't that right, 15 Mr. Mangone? 16 A. I think it's more based on your credit rating and your -- 17 the amount of money you have in the bank. 18 Q. Now, from time to time you applied for credit limits at 19 various casinos, isn't that right? 20 A. Yes. 21 Q. Do you recall, sir, that your credit limit at the Tropicana 22 Hotel in Atlantic City was $10,000? 23 A. Yes. 24 Q. Your credit limit at Caesars Boardwalk in Atlantic City was 25 $20,000? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1685 C31Qann5 Mangone - Cross 1 A. Yes. 2 Q. Your credit limit at the Borgota Hotel and Casino in 3 Atlantic City was $15,000, isn't that right? 4 A. Eventually it went to 20. 5 Q. How about at Mohegan Sun in Connecticut, you didn't have a 6 credit line there, did you? 7 A. I don't recall. 8 Q. Harrah's, you recall in Atlantic City your credit line was 9 about $15,000? 10 A. Yes. 11 Q. Caesars Palace, it was $7,000? 12 A. Yes. 13 Q. Now, in regard to the practice of gambling at these 14 facilities, when you went in, you had something called a 15 players' card? 16 A. Yes. 17 Q. And the reason that card was important is it figured into 18 the casino's decision with regard to something called comps, 19 isn't that right? 20 A. Yes. 21 Q. So it's sort of like frequent flyer miles but at the 22 casino; the more the casino knows you're playing, the more 23 comps you get, isn't that right? 24 A. Correct. 25 Q. Now, so when you went to the window, you could get chips SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1686 C31Qann5 Mangone - Cross 1 for cash and show them your card, isn't that right? 2 A. Or you could draw cash directly. 3 Q. Well, you could post a check against the credit, isn't that 4 right? 5 A. Yes. 6 Q. You would give them a check up to the limit of your credit 7 line, isn't that right? 8 A. Yes. 9 Q. And if you came back and paid them within a certain number 10 of days, they didn't deposit your check, isn't that right? 11 A. That's correct. 12 Q. And if you didn't come back, they deposited your check? 13 A. Yes. 14 Q. And from time to time, you left checks at casinos that you 15 found out the casino had deposited and had come back NSF, not 16 sufficient funds, isn't that right? 17 A. Yes. 18 Q. In fact, you had some problems at a couple of these casinos 19 because you had posted markers and not covered them, isn't that 20 right? 21 A. Yes. 22 Q. In fact, for awhile you were banned from some casinos. 23 A. Yes. 24 Q. Now, it is in the context of these markers that from time 25 to time you would use an attorney trust fund account in order SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1687 C31Qann5 Mangone - Cross 1 to write a marker, isn't that right? 2 A. Not to write a marker, no, sir. 3 Q. Well, to post a marker, post a check to cover your draw? 4 A. Yes. 5 Q. And you did that because you knew your attorney trust 6 account had money in it. 7 A. Yes. 8 Q. And, therefore, you knew none of those markers would ever 9 come back NSF, isn't that correct? 10 A. Yes. 11 MR. SIANO: If I could just have one moment, your 12 Honor. 13 THE COURT: Be my guest. 14 (Pause) 15 Q. So, it would be fair to say you made at least 27 separate 16 casino visits in the year 2006? 17 A. I don't know the exact number, but that would be fair. 18 Q. That's a fair estimate, would you say, Mr. Mangone? 19 A. Yes. 20 Q. Now, Mr. Mangone, if I wanted to determine how much money 21 you'd pushed through the window on each of these visits at each 22 of these casinos, is it your understanding the casino could 23 provide that information? 24 A. I would say so, yes. 25 Q. If I wanted to know how many times you'd left checks and SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1688 C31Qann5 Mangone - Cross 1 drawn chips on credit, the casino would have that information 2 too? 3 A. I believe so. 4 Q. And from time to time you've had occasion to try to resolve 5 some of these accounts with various casinos, isn't that right, 6 Mr. Mangone? 7 A. I don't understand resolve. 8 Q. All right. Let's see if you and I can reconstruct your 9 gambling activity in the year 2006 on these approximately 27 10 visits to casinos in that year. 11 (Pause) 12 MR. CARBONE: Judge, we'd ask for copies of documents 13 if the question is going to be questioned in detail about a 14 complicated document. 15 THE COURT: It is the ordinary practice in this court, 16 Mr. Siano. 17 MR. SIANO: I have most of them, Judge, this has been 18 coming in so many pieces. 19 THE COURT: I appreciate the difficulty, Mr. Siano. I 20 am simply telling you it's the ordinary practice. What's good 21 for the goose is good for the gander. The government has been 22 giving you copies, and I expect the same from you to the 23 government. 24 MR. SIANO: Yes, Judge. Yes. 25 Q. Mr. Mangone, I'm showing you what's been marked for SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1689 C31Qann5 Mangone - Cross 1 identification as Government Exhibit number 52. Take your time 2 and look at this document, sir. I've highlighted a lot in 3 yellow, but please do not be confined by that line. 4 THE COURT: Perhaps Ms. Gallego can locate a second 5 copy of that document? 6 MR. SIANO: I'm going to have a copy made, Judge, 7 immediately. As I said, I'm going to try to confine myself at 8 this point for the rest of the day for the ones I do have 9 copies of. 10 THE COURT: That would be a help. 11 MR. SIANO: I am going to try to do that on the fly, 12 Judge. 13 Q. Mr. Mangone, I'm going to direct your attention to the 14 second page of that document. 15 MR. CARBONE: Judge, may I approach the witness so I 16 could see the document? 17 MR. SIANO: Sure, absolutely. 18 THE COURT: Yes, Mr. Carbone. 19 Q. Mr. Mangone, you testified earlier that you believe you did 20 in fact go to Mohegan Sun in the year 2006. Do you recall, 21 sir, that you went to the Mohegan Sun in October of 2006 and 22 gambled with $5,900 in cash? 23 A. I don't recall, no. 24 Q. Does having a chance to look at that document refresh your 25 recollection in that regard? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1690 C31Qann5 Mangone - Cross 1 A. No, sir. I don't even know where this document comes from. 2 Q. All right. I believe you testified, sir, that you gambled 3 at Tropicana in Atlantic City in the year 2006? 4 A. Yes. 5 MR. SIANO: To allay the Court's concern these are 6 documents I received from the government. 7 MR. CARBONE: Judge, that doesn't mean we have copies 8 handy, obviously. 9 THE COURT: That, of course, would not be Mr. Siano's 10 problem. 11 MR. CARBONE: Judge, may I approach the witness? 12 THE COURT: Yes. 13 MR. SIANO: Actually, Judge, I'm not going to ask the 14 witness about this. Again, I think the spirit of your Honor's 15 order is clear, and I will try to make copies. I am going to 16 hold this one aside. I have some that I did make copies of 17 last night. 18 Q. Mr. Mangone, prior to your appearing here in court today, 19 did you have a meeting with the government in which they asked 20 you to try to recover your gambling records? 21 A. I don't recall. 22 Q. Mr. Mangone, let me show you what's been marked as 23 Defendant's Exhibit 54 for identification. 24 MR. CARBONE: May I see the exhibit? 25 Q. Mr. Mangone, could you look at Defendant's Exhibit 54 for SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1691 C31Qann5 Mangone - Cross 1 identification? 2 A. Yes. 3 Q. I believe you testified earlier that you did travel to both 4 Caesars and Harrah's in Atlantic City, isn't that right? 5 A. Yes. 6 Q. In fact, Caesars and Harrah's are part of the same 7 corporate structure, isn't that right? 8 A. I don't know. 9 Q. Well, you recall, sir, an occasion in the year 2008 when 10 you received winnings of $17,300 from Harrah's? 11 A. No, I don't. 12 Q. If you would be kind enough, sir, then to look at the 13 fourth page of the document I've handed you, 54 for 14 identification. 15 A. Is this the one -- 16 Q. Currency transaction report by casinos is the caption. 17 A. Yes. 18 Q. You see your name there? 19 A. Yes, I do. 20 Q. Does that help you recall, sir, whether or not you received 21 $17,300 on or about June 13, 2008 from Harrah's Resort in 22 Atlantic City? 23 A. No, it doesn't. 24 Q. Nevertheless, sir, do you recognize your social security 25 number on that document? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1692 C31Qann5 Mangone - Cross 1 A. I do. 2 Q. Do you recognize on that document there is included therein 3 your driver's license number? 4 MR. CARBONE: Objection to reading from the document. 5 MR. SIANO: Just asking if it's there. 6 A. It's there, yes. 7 Q. Do you recognize there where it says customer account 8 number, that to be your customer account in connection with 9 Harrah's? 10 A. I believe that's it. 11 Q. Have you ever seen documents of the type that are the first 12 three pages of 54? 13 A. By the first three pages, you mean the one that starts with 14 the currency transaction report? 15 Q. No, I mean the one that starts gaming history statement. 16 If I might. 17 A. Yes. 18 Q. In fact, those are the kinds of statements that a gambler 19 at a casino routinely requests at year end to facilitate tax 20 filing, isn't that right? 21 A. Yes. 22 Q. In fact, these are three gambling -- gaming history 23 statements for you for the years 2007, 2008 and 2009, isn't 24 that right? 25 A. It appears that way, yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1693 C31Qann5 Mangone - Cross 1 Q. In fact, do these, sir, accurately reflect your activities 2 at Caesars and Harrah's for the years covered, 2007, 2008, 3 2009? 4 A. I assume so. 5 MR. SIANO: Offer into evidence, your Honor. 6 MR. CARBONE: Your Honor, may I voir dire? 7 THE COURT: Sure. 8 MR. CARBONE: Mr. Mangone, did you produce these to 9 the government? 10 THE WITNESS: No, I did not. 11 MR. CARBONE: Have you ever seen them before? 12 THE WITNESS: Not till today. 13 MR. CARBONE: Your Honor, our objection is 14 authenticity. Impeachment by extrinsic evidence. 15 THE COURT: Certainly not impeachment by extrinsic 16 evidence. Authenticity. If the government is going to take 17 that position, Mr. Siano, you know you what have to do. 18 MR. SIANO: Absolutely. Nevertheless, subject to 19 connection, Judge, I'd like to proceed with my 20 cross-examination. 21 THE COURT: Absolutely you shall. 22 MR. SIANO: Thank you. 23 BY MR. SIANO: 24 Q. Now, Mr. Mangone, is it fair to say that in the year 2007 25 at Caesars and Harrah's your total losses were approximately SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1694 C31Qann5 Mangone - Cross 1 $71,000? 2 A. It could be, yes. 3 Q. Well -- 4 MR. CARBONE: Judge, the objection is also relevance 5 to 2007 and 2008. 6 THE COURT: You know, Mr. Carbone, I have a somewhat 7 broader definition of relevance than the government does at 8 this moment in time. The objection is overruled. 9 MR. CARBONE: Thank you. 10 BY MR. SIANO: 11 Q. Now, Mr. Mangone, would it be fair to say that your losses 12 from gaming activity at Caesars and Harrah's in the year 2008 13 approximated $78,000? 14 A. Yes. 15 Q. And then your losses were from Caesars only in 2009, isn't 16 that correct? 17 A. Yes. 18 Q. And they were somewhat smaller for you, $5,800, isn't that 19 correct? 20 A. Yes. 21 Q. And you do recognize, as you testified earlier, that your 22 customer account number, as reflected on the currency 23 transaction report, is the number you recall from your 24 activities at Harrah's, isn't that right? 25 A. I don't know if that's exactly the number, but I'm assuming SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1695 C31Qann5 Mangone - Cross 1 if it's there, it's accurate. 2 Q. Thank you. We are going to move on from 54 then. 3 Defendant's 55 for identification. Mr. Mangone, I'm 4 placing in front of you what I've marked for identification as 5 Defendant's Exhibit 55. I ask you, sir -- you could look at 6 any of the pages you want. I'm going to start with some 7 questions on the first page. Do you recognize your signature 8 on the first page of Defendant's Exhibit 55 for identification? 9 A. Yes. 10 Q. In fact, that's your application at the Borgota, isn't that 11 right? 12 A. Yes. 13 Q. Sir, do you recall actually gambling at the Borgota on a 14 number of occasions in the year 2006? 15 MR. CARBONE: Judge, may I approach the witness and 16 look at the document? 17 THE COURT: Yes. 18 A. Yes. 19 Q. You in fact signed that application form? 20 A. Yes. 21 MR. SIANO: Subject to connection, your Honor, I'm 22 offering 55. 23 THE COURT: Admitted. 24 Subject to connection, ladies and gentlemen, means 25 that I might pull it later on if the parties can't agree on the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1696 C31Qann5 Mangone - Cross 1 authenticity of the document or if Mr. Siano is unable to 2 procure testimony that will authentic the document. All right. 3 MR. CARBONE: Judge, we object to this document. It 4 contains a series -- it's a whole packet of documents that may 5 or may not be related. He just asked him about the first page. 6 The documents in here are covering a wide range of time 7 frames -- 8 THE COURT: Would you please show the witness the 9 first page, Mr. Siano. 10 MR. SIANO: I did show the witness the first page. 11 THE COURT: Separate it from the rest of the 12 documents, Mr. Siano. Offer it separately, please. 13 MR. SIANO: Yes. Offer 55. 14 Q. Is that your signature on 55? 15 A. Yes, sir. 16 MR. SIANO: Offer in evidence 55. 17 THE COURT: Accepted subject to connection. 18 MR. SIANO: Thank you. 19 (Defendant's Exhibit 55 received in evidence) 20 Q. Now, Mr. Mangone, on 55 in evidence, there is, in fact, an 21 account number top left, second box? 22 A. OK. Yes. 23 Q. Could you read the account number associated with that 24 application form please? 25 A. 0996997. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1697 C31Qann5 Mangone - Cross 1 Q. The individual identified there -- let's try it this way so 2 that everyone has it. Mr. Turk is not here. I don't dare 3 touch the equipment. 4 Mr. Mangone, do you recognize the biographical 5 information provided there, sir? Do you see Mangone, Anthony? 6 A. Yes. 7 Q. Lawyer? 8 A. Yes. 9 Q. Servino, Santangelo... 10 A. Yes. 11 Q. 1 North Lexington Avenue? 12 A. Yes. 13 Q. That's you, isn't it, Mr. Mangone? 14 A. Yes, sir. 15 Q. Do you see here this information total gross income? 16 A. Yes. 17 Q. Did you write that information in? 18 A. Yes, sir. 19 Q. And do you recall filling this out in or about the year 20 2004? 21 A. Somewhat, yes. 22 Q. OK. Did you in fact report total gross income of $265,000 23 on your federal income tax return for the year 2004? 24 A. I don't recall. 25 Q. How about for the year 2003? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1698 C31Qann5 Mangone - Cross 1 A. I don't think that's -- I don't recall. 2 Q. Let me mark the remainder of these documents as 55A. I'm 3 going to put 55 and 55A in front of you. 4 MR. CARBONE: May I see the defense exhibit? 5 THE COURT: You may come up and stand with the 6 witness. 7 Q. Mr. Mangone, I want to ask you just a couple of questions. 8 The particular rectangle, the full box, have you ever seen that 9 before? 10 A. No. 11 Q. And the serial numbers at the bottom of the page, have you 12 ever seen those before? 13 A. They're not legible. 14 Q. There's sort of about three-quarters of the numbers there, 15 is that fair to say, Mr. Mangone? Eight zero and then some 16 additional digits? 17 THE COURT: Can you see some of the numbers, 18 Mr. Mangone? I can't see anything without magnifying glasses. 19 Can you see some of those numbers or are they entirely 20 obliterated? 21 THE WITNESS: I apologize, your Honor. I apologize. 22 A. Yes, I'm sorry, Mr. Siano, I do see the numbers. 23 Q. No need to apologize, Mr. Mangone. There's a lot of paper 24 flying around. The numbers at the bottom are five digit 25 numbers beginning with 80? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1699 C31Qann5 Mangone - Cross 1 A. That's correct. 2 Q. I'm asking you now about the top half of the document which 3 appears to have displayed a rectangle with information in it. 4 Have you ever seen those before today? 5 A. No. 6 Q. Do you recognize the patron number nonetheless in each one 7 of those boxes? 8 A. Yes, it matches the number on the application. 9 Q. Fine. And that application is 55, and that's the one with 10 your name on it? 11 A. That's correct. 12 MR. SIANO: Subject to connection, your Honor, I offer 13 55A. 14 MR. CARBONE: Judge, there is a whole packet of 15 information. 16 MR. SIANO: They are because they're all the computer 17 screens. 18 THE COURT: The objection is overruled. Subject to 19 connection, it's admitted. 20 You know what we're going to do? I have some fine 21 folks sitting in this jury box who probably have better things 22 to do with the next 40 minutes or so than to watch you guys try 23 to work out the theater in the well in the courtroom. What we 24 are going to do is let you all go until Monday morning. I will 25 work with the lawyers for the next half hour or so and we'll SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1700 C31Qann5 Mangone - Cross 1 see if we can choreograph this a little more clearly and a 2 little more smoothly, so that it goes a little more quickly on 3 Monday when we have to resume for cross-examination of 4 Mr. Mangone. 5 In any event, don't discuss the case. Keep an open 6 mind. I can assure you to a substantial certainty that there 7 will be something about today's testimony in the news in the 8 next 24 to 36 hours. Turn it off. Turn away. Turn the page. 9 You know the rule. No searches. No Googling. No 10 internetting. No anything-ing. All right? Have a wonderful 11 weekend. I'll see you on Monday. 12 (Continued on next page) 13 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1701 C31Qann5 Mangone - Cross 1 (Jury recessed) 2 THE COURT: Thank you, Mr. Mangone. See you on Monday 3 as well. You're on cross. You can't talk to Mr. Halperin or 4 Mr.Carbone, or the agents over the weekend. 5 (Witness recessed) 6 THE COURT: Let him step out for a minute, 7 Mr. Halperin, please. 8 MR. HALPERIN: All right. 9 (Pause) 10 THE COURT: OK. My late partner, Arthur Liman, one 11 the great trial lawyers of his generation referred to the well 12 of the courtroom as a theater in which those of us who were 13 privileged to perform needed to put on a crisp, well 14 thought-out performance. Arthur himself was the most 15 notoriously disorganized and messy human being on the planet 16 with a habit of writing notes on everything, including his 17 cuff, and tossing exhibits hither and yon as he got done with 18 them, only to be able not to find them; and yet everything that 19 he did in the courtroom was choreographed so as not to waste 20 the jury's time, or try the judge's patience, but mostly not to 21 waste the jury's time. 22 We have here a completely anticipated, much discussed 23 in advance of the trial area of cross-examination that cannot 24 possibly come as any surprise to the government about 25 Mr. Mangone's gambling history. The relevance of this, I have SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1702 C31Qann5 Mangone - Cross 1 already ruled on. So let's talk about how we are going to 2 choreograph this. 3 And, Mr. Siano, far be it for me to tell you how to 4 practice law. You seem to be doing just fine on your own, but 5 I'm not sure what the purpose of having Ms. Gallego sitting at 6 that table is if it's not to hand the witness documents and to 7 facilitate this. 8 MR. SIANO: Judge, I believe Ms. Gallego's 9 participation extends beyond the handling of documents, and I 10 accept your Honor's -- 11 THE COURT: As did every Paul Weiss associate, 12 Mr. Siano, but, honestly, we truly could move this along if we 13 had one here and one there (indicating). 14 MR. SIANO: Judge, the notion that you would put my 15 name and Paul Weiss in the same sentence -- 16 THE COURT: I do. Having seen you try this case, 17 Mr. Siano, I do and proudly. 18 MR. SIANO: Judge, let me say the following: As your 19 Honor has already commented, I have made much of these gambling 20 activity records. I have made repeated requests from the 21 government. I have gotten some portion of these documents from 22 the government, and there have been some casinos as to which 23 there are no documents. We've served subpoenas. We've served 24 them in the appropriate form. We've gotten responses. What I 25 could not anticipate was the fact that I was still getting SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1703 C31Qann5 Mangone - Cross 1 casino records 48 hours ago. 2 Now, I will say to your Honor, I didn't anticipate, 3 and I can't, where Mr. Mangone is going to give an answer 4 consistent with the paper and where he isn't, and I try to be 5 fair with the witness; but, frankly, your Honor, I'm not giving 6 him any quarter on this -- 7 THE COURT: You shouldn't. I'm not suggesting that 8 you should. 9 MR. SIANO: And although my presentation is labored, I 10 will tell you, Judge, I have a witness -- not only do I have 11 certified authenticated copies coming, I have a witness who 12 will explain all of this to the jury. I am giving this man the 13 opportunity to answer questions, and if I am a little bit 14 labored, I will endeavor to be better on Monday morning. The 15 government will have copies of everything I have. 16 THE COURT: That will certainly help. 17 MR. SIANO: Now that I'm on cross. I will also tell 18 you, Judge, that many of these records carry the government's 19 Bates numbers at the bottom of the pages. 20 THE COURT: That's as may be, Mr. Siano, and I 21 understand, and you understand that the government has been on 22 notice that Mr. Mangone's gambling is going to be the subject 23 of lengthy cross-examination, and now if the government was 24 under any misapprehension, the government knows that I consider 25 it relevant to go beyond the precise year of the transfer of SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1704 C31Qann5 Mangone - Cross 1 money that is in question on the indictment in this case. 2 MR. SIANO: Now, that Mr. Mangone is on cross, I could 3 give the government everything I have -- 4 THE COURT: What I would have done is I would have 5 given it to him when I stood up. That's neither here nor 6 there. You will certainly give the government everything you 7 have and that you intend to use. 8 MR. SIANO: Yes. 9 THE COURT: And if the government is going to persist 10 in its insistence that you call custodians of records from all 11 of these casinos, I will be happy to sit here for a week with 12 the jury and listen to you do it. 13 MR. SIANO: Judge, I believe I'm entitled to proceed 14 by way of certificate as to these records. That's what I 15 think, and that's what I intend to do. The ones that have come 16 from the government, I would suspect the government would not 17 allege that the records they have given me are not business 18 records, but we will only know what we will know when they take 19 a position. 20 As I said, I want to get this witness on cross. I 21 have substantial questions about this witness as, your Honor, I 22 have made clear to you throughout the proceedings of this 23 case -- 24 THE COURT: It was never a secret. 25 MR. SIANO: And to the extent that I have lessened our SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1705 C31Qann5 Mangone - Cross 1 effectiveness for the first time this afternoon in the well, I 2 would say, your Honor, I apologize for that. I really didn't 3 know where he was going to go. If he started to be a little 4 bit forthcoming, I thought we would have gotten through this 5 more quickly. Now that we're not for reasons that don't 6 necessarily have to do with Mr. Mangone, I will go the long way 7 around. 8 MR. HALPERIN: Judge, first of all, we obviously 9 strongly disagree with the characterization that the witness is 10 not being forthcoming. 11 Second of all, in terms of the Court's ruling about 12 what's relevant about the gambling, we clearly understood that 13 this was relevant to a limited portion as per the Court's 14 ruling -- 15 THE COURT: I changed my mind as I've heard the 16 evidence. 17 MR. HALPERIN: That's fine. 18 THE COURT: You get rulings in advance of trial, you 19 can't be sure they'll stick, Mr. Halperin, because I have to 20 listen to the evidence for the first time just like the jury 21 listens to it for the first time. 22 MR. HALPERIN: Obviously the Court has every 23 prerogative in the world -- 24 THE COURT: Nothing is written in stone. 25 MR. HALPERIN: Absolutely. But the reason why I think SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1706 C31Qann5 Mangone - Cross 1 Mr. Carbone's objection about the time frame of 2008 was 2 entirely fair at the time was because according to the Court's 3 sealed ruling in the robing room from Tuesday morning, the 4 Court made clear that to the extent any of Mr. Mangone's 5 gambling activity was relevant, it was around the time frame of 6 the cash payments; that's what the Court said. If the Court is 7 now changing that, we're on notice, we understand that. 8 In terms of the other issue, Judge, before I raised 9 the issue of getting copies of Defendant's Exhibits as they're 10 handed up to witnesses with the Court this morning, I have 11 raised that no less than four times with defense counsel 12 beforehand. For them to say these came from the government is 13 ridiculous. I have never seen anything like that. We produced 14 one hundred thousand pages of documents in discovery. So for 15 them to give us Bates numbers 83,008 to 83,028 and expect us to 16 have them handy in the courtroom -- 17 THE COURT: Mr. Halperin, you protest too much. I 18 believe that the defense is to provide you with a set of the 19 materials he is going to use on cross-examination. 20 MR. SIANO: Thank you. 21 THE COURT: I believe that. He didn't have to do it 22 before Mr. Siano stood up and you didn't ask. They happened to 23 have it handy when Mr. Siano stood up, and I told Mr. Siano 24 that I expect you to have copies of those documents so that you 25 can quickly expeditiously grab ahold of documents and not have SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1707 C31Qann5 Mangone - Cross 1 Mr. Carbone trotting back and forth. 2 MR. HALPERIN: Can we then ask, so everyone is clear 3 that from this point forward, at the beginning of any 4 cross-examination they will give us the stack of documents they 5 expect to show to that particular witness? 6 THE COURT: That is what I think is perfectly fair. 7 MR. HALPERIN: Thank you. We have nothing further. 8 THE COURT: I don't mean to be overly critical, 9 Mr. Siano, I really don't. 10 MR. SIANO: No, Judge. I have had the pleasure of 11 being yelled at, and your Honor is not raising her voice at 12 all. I've had the pleasure of being yelled at by judges in 13 several districts, so I consider your Honor's criticism both 14 measured and appropriate. 15 As I said, in this particular instance, because this 16 witness is so critical, and because my concern is so great, and 17 I wasn't quite sure how we were going to go, so I accept the 18 criticism, and we'll cover this before Monday morning. 19 What time are we starting on Monday, Judge? 20 THE COURT: At 9:30. Now I will say -- and Monday 21 again we will go again until five of 4:00. 22 MR. HALPERIN: Five of 4:00, Judge? 23 THE COURT: 3:55. 3:55 p.m. I will say this: Having 24 heard all that I have heard, I am prepared to give you some 25 latitude to go beyond 2006 and the immediate time of the Milio SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1708 C31Qann5 Mangone - Cross 1 transfer payment on the gambling. If I were you, I wouldn't 2 plan to spend hours on his gambling habits between 2003 and 3 2009. 4 MR. SIANO: Judge, I don't. I want to do analyzed 5 numbers in the prior years, and I have an absolutely critical 6 reason for doing every visit in 2006. 7 THE COURT: That I understand, completely. 8 MR. SIANO: Judge, the magnitude I believe will be 9 persuasive with the jury, and there has been testimony from 10 this witness on direct that I do believe these gambling records 11 contradict. 12 THE COURT: All right. 13 MR. SIANO: So I take your Honor's guidance to heart. 14 I will tell the government they are going to get a very light 15 touch on the other years, and they are going to get particular 16 dates in 2006. That's all I intend to do. 17 Thank you, Judge. 18 THE COURT: OK. The last thing I would like you folks 19 to do over the course of the weekend is see if you can work out 20 some kind of a stipulation relating to the authenticity of 21 these documents. 22 MR. CARBONE: Judge, obviously the government 23 stipulates to authenticity all the time, but when we're handed 24 a pile of documents we've never seen before -- 25 THE COURT: Mr. Carbone, I said you protest too much. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1709 C31Qann5 Mangone - Cross 1 I asked if you could work it out over the course of the 2 weekend. 3 MR. CARBONE: We'll do that. 4 THE COURT: To the extent that the defense felt it 5 necessary to keep the cards close to the vest, the moment for 6 that has passed, all right? Let's see what we can do to 7 alleviate the authenticity problem. The jury, which gets it, 8 will appreciate it. 9 MR. HALPERIN: Judge, last question in terms of 10 timing. 11 THE COURT: Yes, sir, Mr. Halperin. 12 MR. HALPERIN: The Court had asked the other day about 13 how long we think the government's case is going to go. 14 Obviously, a big part of that is how long the cross of 15 Mr. Mangone will go. If Mr. Mangone is off the stand, I am 16 guessing sometime late Monday or Tuesday, if that's the case-- 17 THE COURT: That's what I'm expecting. 18 MR. HALPERIN: OK. I think we will have approximately 19 one more week of trial testimony for the government's case. If 20 I am recalling the Court's pretrial rulings correctly, I know 21 it's the Court's standard practice to direct that one week 22 before the defense case we will get a copy of the list of the 23 defense witnesses and any defense exhibits, so I just wanted to 24 put that on the record and let's ask for that, by let's, say 25 next Tuesday. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1710 C31Qann5 Mangone - Cross 1 MR. ARONWALD: Your Honor, let me just say that I 2 indicated in my opening that we certainly are calling 3 Mr. DelBello as a witness. So I let the government know that. 4 I also think the record should reflect that the government has 5 met with Mr. DelBello. We will also be calling other witnesses 6 for certain. We will give the government a list of those 7 witnesses by Tuesday. But as your Honor can imagine, there are 8 certain witnesses who cannot be determined until we hear what 9 the governments witnesses have to say. There are 20 some odd 10 witnesses left to testify, so I don't know -- 11 THE COURT: I appreciate that, and indeed that is why 12 in the end full disclosure of everything has to abide the 13 government saying the magic words "the government rests." 14 Now, that said, Mr. Halperin does allude to a practice 15 that we agreed upon in the last long trial he had in front of 16 me where the defense lawyers who shortly before, I think within 17 three or four days before the government's case was due to wind 18 up, began turning over information about witnesses that they 19 knew they were going to call, all the while reserving their 20 rights to supplement the list. And I think that is a fair 21 practice. 22 So, to the extent that you know you are going to call 23 Mr. DelBello or any other particular person, then by the close 24 of business Tuesday, I think the government probably should 25 know it. All right? Have a splendid weekend. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1711 C31Qann5 Mangone - Cross 1 MR. CARBONE: Thank you. 2 MR. HALPERIN: Thank you, your Honor. 3 (Trial continued Monday March 5, 2012 at 9:30 a.m.) 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1712 1 INDEX OF EXAMINATION 2 Examination of: Page 3 ANTONIO MILIO 4 Cross By Mr. Aronwald . . . . 1560 5 Redirect By Mr. Halperin . . . 1578 6 ANTHONY MANGONE 7 Direct By Mr. Carbone . . . . 1587 8 Cross By Mr. Siano ...... 1657 9 Cross Q...... 1678 10 GOVERNMENT EXHIBITS 11 Exhibit No. Received 12 3519-B1 ...... 1583 13 805 ...... 1594 14 3517-EE ...... 1608 15 775 ...... 1639 16 778 ...... 1647 17 DEFENDANT EXHIBITS 18 Exhibit No. Received 19 [Exhibit]*[received] ...... 1576 20 55 ...... 1696 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300

1713 C35UANN1 Trial 1 UNITED STATES DISTRICT COURT 1 SOUTHERN DISTRICT OF NEW YORK 2 ------x 2 3 UNITED STATES OF AMERICA, 3 4 v. 10 CR 007 (CM) 4 5 SANDY ANNABI and ZEHY JEREIS, 5 6 Defendants. 6 7 ------x 7 8 New York, N.Y. 8 March 5, 2012 9 9:55 a.m. 9 10 10 11 11 Before: 12 12 HON. COLLEEN MCMAHON 13 13 District Judge 14 14 15 APPEARANCES 15 16 PREET BHARARA 16 United States Attorney for the 17 Southern District of New York 17 JASON P.W. HALPERIN 18 PERRY A. CARBONE 18 Assistant United States Attorneys 19 19 WILLIAM I. ARONWALD 20 Attorney for Defendant ANNABI 20 21 ANTHONY J. SIANO 21 JEANNIE GALLEGO 22 Attorneys for Defendant JEREIS 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1714 C35UANN1 Trial 1 (In open court; jury not present) 2 THE COURT: I feel terrible today, so if we take quick 3 and unanticipated breaks, I apologize. 4 MR. CARBONE: It might make you feel better to let you 5 know, Judge, we were able to stipulate to authenticity. 6 THE COURT: That makes me feel better. 7 MR. SIANO: It is all Mr. Carbone. 8 THE COURT: I don't believe that, Mr. Siano. I don't 9 believe that for a second. It is a joint effort. 10 But I am definitely not on my game today. 11 12 (Continued on next page) 13 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1715 C35UANN1 Trial 1 (Jury present) 2 THE COURT: Good morning, everybody. 3 Fair warning, I have felt better on many days than I 4 feel today, so if we take a really quick break, forgive me. 5 Mr. Mangone, you are still under oath. 6 ANTHONY MANGONE, resumed. 7 CROSS-EXAMINATION (Continued) 8 BY MR. SIANO: 9 MR. SIANO: May I proceed, your Honor? 10 THE COURT: Please do, Mr. Siano. 11 Folks, you will be glad to know that the lawyers have 12 worked everything out over the weekend. 13 MR. SIANO: Your Honor, at this time, the defense 14 wishes to reoffer, not subject to connection Defense Exhibits 15 52, 53, 54, 55 and 55A which were marked previously and shown 16 to the witness. At this time we offer them pursuant to an 17 agreement with the government that they are in fact admissible. 18 MR. CARBONE: No objection, your Honor. 19 THE COURT: Admitted. 20 (Defendant Exhibits 52, 53, 54, 55 and 55A received in 21 evidence) 22 THE COURT: They just needed a weekend off. 23 MR. SIANO: In addition, your Honor, brighter still 24 sunshine at this time defense offers Defense Exhibit 56, being 25 certain of the gambling records of Mr. Mangone at the Atlantis SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1716 C35UANN1 Mangone - cross 1 Casino at the Bahamas, subject to redactions that Mr. Carbone 2 and I will work out with our own little black pens. We offer 3 Exhibit 56 at this time. 4 MR. CARBONE: No objection. 5 THE COURT: Admitted. 6 (Defendant Exhibit 56 received in evidence) 7 MR. SIANO: We offer Defense Exhibit 57, certain 8 gambling records of Mr. Anthony relative to the Borgota Hotel, 9 again, subject to redactions. 10 MR. CARBONE: No objection. 11 THE COURT: Admitted. 12 (Defendant Exhibit 57 received in evidence) 13 MR. SIANO: We offer Defense Exhibit 58, certain of 14 the gambling records of Mr. Anthony Mangone for the Caesars 15 Atlantic City casino, subject to redaction. 16 MR. CARBONE: No objection. 17 THE COURT: Admitted. 18 (Defendant Exhibit 58 received in evidence) 19 MR. SIANO: We offer Defense Exhibit 59, certain of 20 the gambling records for Mr. Anthony Mangone for Caesars Las 21 Vegas, subject to redaction. 22 MR. CARBONE: No objection. 23 THE COURT: Admitted. 24 (Defendant Exhibit 59 received in evidence) 25 MR. SIANO: We offer Defense Exhibit 60, certain of SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1717 C35UANN1 Mangone - cross 1 the gambling records of Mr. Anthony Mangone for Harrah's hotel 2 and Casino, subject to redaction. 3 MR. CARBONE: No objection. 4 THE COURT: Admitted. 5 (Defendant Exhibit 60 received in evidence) 6 MR. SIANO: Defense Exhibit 61 we offer into evidence 7 certain gambling records of Anthony Mangone relative to the 8 Mohegan Sun subject to redaction. 9 MR. CARBONE: No objection. 10 THE COURT: Admitted. 11 (Defendant Exhibit 61 received in evidence) 12 MR. SIANO: Finally, Exhibit 62, we offer certain of 13 the gambling records of Anthony Mangone relative to the 14 Tropicana Atlantic City, also subject to redaction. 15 MR. CARBONE: No objection. 16 THE COURT: Admitted. 17 (Defendant Exhibit 62 received in evidence) 18 MR. SIANO: Thank you. 19 BY MR. SIANO: 20 Q. Mr. Mangone, I believe you testified on Thursday that you 21 represented the Milios on matters other than the Longfellow 22 project, is that correct? 23 A. Yes, sir. 24 Q. In fact you did so? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1718 C35UANN1 Mangone - cross 1 Q. In fact you were still representing them into the year 2 2008, isn't that correct? 3 A. Yes. 4 Q. In fact there was some discussion in one of those car 5 conversations where you said Franco Milio was shifty and 6 fidgety where, in addition to his attempt to talk to you about 7 the Longfellow project, you were talking to him about what you 8 were doing on other projects, isn't that right? 9 A. I don't recall the exact conversation, but there might have 10 been other mentions of closings and so forth. 11 Q. You continued to represent the Milios through 2008? 12 A. Not through 2008. At some point the representation ended 13 in 2008. 14 Q. Can you fix for me when it "ended"? 15 A. The spring of 2008. 16 Q. You testified on direct, sir, that you had an interview in 17 the office of the United States Attorney at the end of April 18 2008. Do you remember saying that? 19 A. Yes. 20 Q. In fact you did that, isn't that right? 21 A. Yes. 22 Q. Now, prior to that meeting, there had been a number of 23 events involving the Longfellow project and you that I want to 24 ask you about. I want to focus on that. 25 Before you walked in the door to the U.S. Attorney's SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1719 C35UANN1 Mangone - cross 1 office in April of 2008, sir, you had had a number of these 2 shifty, fidgety conversations with Franco Milio prior to your 3 going into the U.S. Attorney's office, isn't that right? 4 A. There were two. 5 Q. In addition to that, you had referred Franco Milio to more 6 than one attorney, isn't that right? 7 A. In the summer of '07, yes. 8 Q. In fact you started out by referring him to one of your 9 partners, Michael Santangelo, isn't that right? 10 A. Yes. 11 Q. And Mr. Milio told Mr. Santangelo about the cash that 12 Franco Milio said the Milios had given to you, isn't that 13 right? 14 A. Yes. 15 Q. After that happened, I believe Mr. Santangelo came to you 16 and, in essence, asked you what was going on? 17 MR. CARBONE: Objection. Hearsay. 18 THE COURT: Overruled. 19 A. Yes. 20 Q. It was after that, that you had your meeting with Franco 21 Milio downstairs in the ground floor or basement of your firm, 22 isn't that right? 23 A. Yes. 24 Q. I believe the firm was described as an office building on 25 Thursday; it was in fact a converted house, wasn't it? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1720 C35UANN1 Mangone - cross 1 A. It was a commercial space that was formerly a house. 2 Q. It was a commercial space that used to be a house, isn't 3 that correct? 4 A. Yes. 5 Q. You went downstairs, and is this where you told Franco 6 Milio nobody needs to know about the cash? 7 A. Yes. 8 Q. After that conversation, you sent him to Mr. Diagiansante, 9 isn't that correct? 10 A. Yes. 11 Q. So you sent him on his way with your guidance being to not 12 tell Mr. Diagiansante about the cash? 13 A. That's correct. 14 Q. But you had a further conversation with Michael Santangelo, 15 isn't that right? 16 A. Yes. 17 Q. You had a conversation with Michael Santangelo and his 18 cousin, George Santangelo, isn't that right? 19 A. No, sir. 20 Q. Did you have a conversation with Michael Santangelo in 21 which the concept of a brilliant defense was raised? 22 A. Yes. 23 Q. Who was present at the brilliant defense conversation? 24 A. Myself and Mr. Santangelo. 25 Q. Not George Santangelo? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1721 C35UANN1 Mangone - cross 1 A. No, sir. 2 Q. So you don't recall telling the FBI that there was a 3 meeting with Michael Santangelo and George Santangelo at which 4 George Santangelo suggested that the money you claim you paid 5 to Zehy Jereis could be a consulting fee? 6 A. No, sir, I never said that. 7 Q. Now, you nonetheless had this brilliant defense 8 conversation with Michael Santangelo? 9 A. Yes. 10 Q. Who suggested that it be described as a consulting fee? 11 A. Mr. Santangelo. 12 Q. Michael Santangelo suggested it to you? 13 A. That's correct. 14 Q. Then you shared that brilliant defense with a gentleman 15 named Pat Stiso, isn't that right? 16 A. Yes. 17 Q. Mr. Stiso spent a lot of time in the offices of Servino 18 Santangelo Randazzo and Mangone and its various permutations, 19 didn't he? 20 A. Yes. 21 Q. In fact from time to time, Mr. Stiso was involved in the 22 passing of cash to various individuals, isn't that right? 23 A. I don't know. 24 Q. You don't know that? 25 A. No, sir. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1722 C35UANN1 Mangone - cross 1 Q. You do know, however, and you did know at the time that 2 Mr. Stiso was also a disbarred lawyer, isn't that right? 3 MR. CARBONE: Objection. 4 THE COURT: Overruled. 5 A. Yes. 6 Q. And did you know the circumstances of his disbarment? 7 A. Not particularly, no. 8 Q. How about generally? 9 MR. CARBONE: Judge, I object. It is irrelevant. 10 THE COURT: Overruled. 11 Q. How about generally? 12 A. Yes, sir. 13 Q. In fact he was convicted of federal crimes, isn't that 14 right? 15 A. Yes. 16 Q. And sent to prison? 17 A. Yes. 18 Q. Just like Mr. Pirro? 19 A. Yes. 20 Q. Different crimes, though? 21 A. Definitely, yes. 22 Q. And he was there in the offices of Servino Santangelo 23 Randazzo and Mangone working in some capacity, is that correct? 24 A. Yes. 25 Q. And then you talked to Mr. Stiso about the brilliant SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1723 C35UANN1 Mangone - cross 1 defense, didn't you? 2 A. Yes. 3 Q. And Mr. Stiso also accompanied you down to see another 4 lawyer in the Bronx, isn't that right? 5 A. Yes. 6 Q. He took you down to see somebody named Murray Richman, 7 isn't that right? 8 A. That's right. 9 Q. And you and Mr. Richman discussed your brilliant defense, 10 isn't that right? 11 A. No, sir. 12 Q. Well, you discussed Longfellow? 13 A. I discussed my involvement. 14 Q. With Longfellow? 15 A. Yes. 16 Q. This was in about 2008? 17 A. Yes. 18 Q. Did Mr. Richman ever tell you that at the time he was 19 representing Sandy Annabi? 20 MR. CARBONE: Objection. 21 THE COURT: The objection is overruled. 22 A. At one point in the meeting, yes. 23 Q. So he told you he was representing Sandy Annabi and you 24 talked to him about Longfellow? 25 A. At one point, yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1724 C35UANN1 Mangone - cross 1 Q. And all of this happened before you went into the U.S. 2 Attorney's office, isn't that right? 3 A. Yes. 4 Q. In April of 2008? 5 A. That's correct. 6 Q. Now, other than describing the cash you received from the 7 Milios as a consulting fee to Mr. Jereis, was there any other 8 component to this brilliant defense that Mr. Santangelo and you 9 discussed? 10 A. I don't believe so. 11 Q. So that was the essence of this defense you were going to 12 put up when you went in to see the U.S. Attorney's office? 13 A. Yes. 14 Q. You have testified on direct that that was a lie? 15 A. Yes. 16 Q. Now, in addition to your interview on April 30 of 2008, you 17 had a subsequent initial interview -- I will call it a first 18 interview -- after you were indicted in this case, isn't that 19 correct? 20 A. Yes, sir. 21 Q. And that interview, do you recall it taking place on March 22 19 of the year 2010? 23 A. Sometime around that time. 24 Q. Well, there had been a material change in your 25 circumstances in January of 2010, isn't that right? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1725 C35UANN1 Mangone - cross 1 A. Yes, sir. 2 Q. You were indicted? 3 A. Yes. 4 Q. And you were indicted for Longfellow, isn't that correct? 5 A. Yes. 6 Q. Did you have a clue before the indictment that perhaps your 7 interview in April of 2008 with the U.S. Attorney's office 8 hadn't gone very well? 9 A. I don't understand the question. 10 Q. When you left the interview on April 30, 2008, did you 11 think the government believed you during the interview? 12 A. I don't know. 13 MR. CARBONE: Objection. 14 THE COURT: The objection is sustained. 15 Q. You went into the interview in April 2008 with a lawyer, 16 didn't you? 17 A. Yes. 18 Q. Mr. Barry Levin? 19 A. Yes. 20 Q. When you went into the interview, there was no proffer 21 agreement, is that correct -- and I put my fingers up quotes -- 22 you know what the words "proffer agreement" mean, don't you? 23 A. Yes. 24 Q. You didn't take a proffer agreement at the beginning of the 25 meeting, isn't that right? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1726 C35UANN1 Mangone - cross 1 A. Yes. 2 Q. You heard your lawyer say to the prosecutors, this was an 3 innocence proffer, isn't that correct? 4 A. Yes. 5 Q. And you heard your lawyer say that, essentially, you were 6 going to talk to the government and show them that you were 7 innocent, isn't that right? 8 A. Yes. 9 Q. And you knew at the time that was a lie, isn't that 10 correct? 11 A. Yes. 12 Q. Nonetheless, your lawyer said that -- did you stop him at 13 that point? 14 A. No. 15 Q. Then you started to talk to the government, isn't that 16 right? 17 A. Yes. 18 Q. About halfway through the interview, your lawyer changed 19 the conversation, isn't that right? 20 A. I believe so. 21 Q. Right in the middle of the interview, he said he needed a 22 proffer agreement, isn't that right? 23 A. Yes. 24 Q. So then you had this proffer agreement you signed in the 25 middle of the interview and you kept talking, isn't that right? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1727 C35UANN1 Mangone - cross 1 A. Yes. 2 Q. As we have already discussed, you were indicted in January 3 of 2010, isn't that correct? 4 A. Yes. 5 Q. After you were indicted, you got a copy of this document, 6 the accusatory instrument and you read it, isn't that right? 7 A. Yes. 8 Q. After you read it, you decided to go back and talk to the 9 government again, isn't that right? 10 A. Yes. 11 Q. And you got yourself a new lawyer? 12 A. Yes. 13 Q. And you and the new lawyer went in and talked to the 14 government on March 19, 2008? 15 A. Yes. 16 Q. Do you recall, sir, with respect to April 30 of 2008 and 17 March 19 of 2010, many of the questions were similar? 18 A. Yes. 19 Q. Of course they asked you about Longfellow? 20 A. Yes. 21 Q. But they also asked you about Ridge Hill, didn't they? 22 A. I don't have a specific recollection. 23 Q. Do you have a general recollection? 24 A. Generally, yes. 25 Q. And, generally, they did ask you about Ridge Hill? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1728 C35UANN1 Mangone - cross 1 A. Yes. 2 MR. SIANO: One moment, your Honor. 3 May I approach, your Honor? 4 THE COURT: You may. 5 MR. CARBONE: May I ask what counsel is showing -- 6 MR. SIANO: 3517A. 7 BY MR. SIANO: 8 Q. Mr. Mangone, I have placed in front of you what has been 9 previously marked as Government Exhibit 3517A. I ask you, sir, 10 prior to your getting on the witness stand today, have you ever 11 seen that document? 12 A. Yes. 13 Q. The government showed you that 302? 14 A. Yes. 15 Q. When? 16 A. I believe it was turned over in -- early on in the case. 17 Q. So you got a copy of your statement from the government 18 initially? 19 A. That's correct. 20 Q. Now, I am going to place in front of you 3517C. Do you 21 recognize 3517C, sir? 22 A. Yes. 23 Q. In fact, that is an FBI FD 302 report about a series of 24 interviews you gave beginning with the proffer session of March 25 19, 2010, isn't that correct? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1729 C35UANN1 Mangone - cross 1 A. This is all March 19, 2010. 2 Q. We can agree at least the first many pages are that? 3 A. Yes, sir. 4 Q. Now, and you had occasion to get this from the government 5 shortly after -- never mind, that's wrong. I apologize, 6 Mr. Mangone. 7 Have you ever seen that 302 prior to today? 8 A. Yes. 9 Q. When? 10 A. I don't have an exact date. 11 Q. Well, you didn't get that 302 at the time you were 12 indicted, did you, sir? 13 A. No. It was after. 14 Q. It was afterwards because you didn't make those statements 15 until about two-plus months after you were indicted? 16 A. That's correct. 17 Q. Now, could you look at 3517A, sir? 18 A. Yes, I have it. 19 Q. And tell me if you made any mention of a meeting at Reno's 20 in your interview of April 30, 2008. Take your time. 21 (Pause) 22 A. It doesn't mention Reno's. It just says -- go ahead. 23 Q. There is no mention of a meeting at Reno's in your initial 24 interview with the FBI, is there? 25 A. No. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1730 C35UANN1 Mangone - cross 1 Q. Now, if you would be kind enough to look at 3517C, sir, is 2 there in fact a mention of the fact that you had a meeting at 3 Reno's? 4 A. Yes, sir. 5 Q. Now, would you please tell me if you made any mention of 6 Nick Spano being at your first meeting with the Milios during 7 your interview of April 30, 2008? 8 A. It just says, Mangone held meetings with the Milios, 9 meetings. It does not refer to the initial meeting. 10 Q. It doesn't mention Nick Spano, does it, in your meeting of 11 April 30, 2008 with the government, does it, Mr. Mangone? 12 A. No. 13 MR. CARBONE: We object as to form. If he wants to 14 ask Mr. Mangone a question, he should do that. If he wants to 15 show him something to refresh his recollection, he can do that, 16 but he just shouldn't be reading from the document. 17 THE COURT: The objection is overruled. 18 BY MR. SIANO: 19 Q. Mr. Mangone, in your meeting with the government on 20 3/19/2010, however, you tell them, Mr. Spano was at the Reno's 21 meeting, isn't that right? 22 A. Yes. 23 Q. So you omitted Mr. Spano from your initial session with the 24 government when you met with them in 2008? 25 A. No. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1731 C35UANN1 Mangone - cross 1 Q. Are you saying, sir, in 2008, you told the government that 2 Mr. Spano was at the initial meeting with the Milios? 3 A. From my recollection, yes. 4 Q. So the FBI agents that wrote this report didn't write it 5 down? 6 MR. CARBONE: Objection. 7 THE COURT: Overruled. 8 A. I can only go by what the document states, sir. 9 Q. And the document reflects no such recitation by you, does 10 it, Mr. Mangone? 11 A. Not according to this document. 12 Q. Now, if you would be kind enough -- I am going to ask you, 13 did you say to the government in your meeting of April 30th 14 that Zehy Jereis was at your initial meeting with the Milios? 15 A. No. 16 Q. Nevertheless, sir, do you see it reflected in the last 17 paragraph of the first page of 3517A? 18 A. Say again, sir, where is it? 19 Q. 3517A, the last paragraph on the first page in the middle 20 of the paragraph. 21 A. Yes. That was a meeting at my office, sir. 22 Q. Does it say a meeting at your office? 23 A. No, it does not. 24 Q. In fact it says, Zehy Jereis attended the initial meeting 25 with the Milios? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1732 C35UANN1 Mangone - cross 1 MR. CARBONE: Objection. 2 THE COURT: Ground? 3 MR. CARBONE: He is just reading from the 302, just 4 selective snippets, your Honor. 5 THE COURT: Objection overruled. It is not a proper 6 objection. You have a standing objection to that. I don't 7 want you getting up every question and saying that, Mr. 8 Carbone. It is not a proper objection. 9 BY MR. SIANO: 10 Q. It says Zehy Jereis was present at the initial meeting with 11 the Milios? 12 THE COURT: Is that correct? 13 Q. Is that correct? 14 A. That's what the report says, yes. 15 Q. Did you tell the FBI that? 16 A. He was at the first meeting at my office, that's what I 17 told them. 18 Q. That's what you told them? 19 A. That's correct. 20 Q. You didn't tell them it was the initial meeting? 21 A. I did not tell them that he was at the first meeting at 22 Reno's. 23 Q. But you didn't tell the FBI about Reno's on April 30, did 24 you, Mr. Mangone? 25 A. Yes, I did. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1733 C35UANN1 Mangone - cross 1 Q. Now, however, on March 19, 2010, you told the FBI that 2 there was a second meeting set up at your office with the 3 Milios and Mr. Jereis was at that meeting? 4 A. That's correct. 5 Q. And that's reflected in the 302? 6 A. Yes, it is. 7 Q. Now, do you recall being asked about the relationship 8 between Zehy Jereis and Sandy Annabi in your interview of April 9 30, 2008? 10 A. Yes. 11 Q. And do you recall telling the FBI that Mr. Jereis was very 12 close with council person Sandy Annabi? 13 A. Yes, I did. 14 Q. That's what you told them on April 30, 2008? 15 A. Yes. 16 Q. You didn't tell them on 2008 that Mr. Jereis and Ms. Annabi 17 were sleeping together? 18 A. I don't recall that, sir. 19 Q. Well, are you saying, sir, this was another mistake by the 20 FBI agent relative to your interview on April 30th? 21 A. No. I am not saying that at all. 22 Q. You didn't say that to the FBI on April 30th, did you, Mr. 23 Mangone? 24 A. I don't recall. 25 Q. Nevertheless, on March 19, 2010, you in fact said that SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1734 C35UANN1 Mangone - cross 1 there were discussions at the meeting that Jereis had with the 2 Milios about Jereis sleeping with Sandy Annabi? 3 A. Yes. 4 Q. And that's what you told the FBI on March 19? 5 A. Yes. 6 Q. And you said that that was discussed at the meeting you had 7 with the Milios and Mr. Jereis in your conference room? 8 A. Before Mr. Jereis arrived. 9 Q. Well, did the Milios tell you that Mr. Jereis was sleeping 10 with Ms. Annabi? 11 A. One of the cousins, Mr. Miano, had asked if it was 12 accurate. 13 Q. And what did you say? 14 A. I said that it was something that led to a lot of 15 questions. 16 Q. Is that reflected in the 302, sir, that Dominick Miano 17 raised it and it led to a lot of questions? 18 A. No, sir. 19 Q. In fact what is reported there is that you discussed with 20 the Milios that Jereis was sleeping with Annabi and was able to 21 get her to do things if asked? 22 A. No. That's not what it says. 23 Q. Isn't it a fact, sir, that the report in front of you, 24 3517C, says at the second sentence at the top -- 25 A. I apologize. I wasn't reading that section. I was reading SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1735 C35UANN1 Mangone - cross 1 the next line down. 2 Q. It says that, doesn't it, Mr. Mangone? 3 A. Yes, it does. 4 Q. Do you recall telling the FBI in your interview of April 5 30, 2008 that you had told Mr. Jereis that you would be able to 6 get him $10,000 from the Milios for Jereis' services? 7 A. Yes. 8 Q. I direct your attention, sir, to the bottom of the first 9 full paragraph on the second page of 3517A. 10 A. I'm sorry. Say that again, sir. 11 MR. SIANO: Could I ask the court reporter to read my 12 question, please? 13 (Record read) 14 A. Yes. 15 Q. In fact, that's what you said to the government on April 16 30, 2008? 17 A. Yes. 18 Q. You had told Jereis you would be able to get him $10,000? 19 A. That's what I told the government. 20 Q. And then, in your interview of March 19 in 2010, you told 21 the government that you told Mr. Jereis he would have to settle 22 for $20,000? 23 A. That's correct. 24 Q. Now, do you recall telling the government in your meeting 25 on April 30, 2008 that it was around June 2006 when Franco was SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1736 C35UANN1 Mangone - cross 1 told that Jereis wanted to be paid $10,000? 2 I direct your attention to the second page of the 3 document, the next to the last paragraph? 4 A. This is on the 5/1/08 document -- 5 Q. No. This is on the April 30th document, 3517A. 6 A. Yes. 7 Q. That's what you told the government, and that's what you 8 said you had told Franco Milio in June of 2006? 9 A. Correct. 10 Q. Now, then you went in for an interview on March 19 of 2010 11 and what you told the government is, that you told Franco the 12 costs to get Annabi to approve the project would be a total of 13 $30,000; this cost included the $20,000 success fee plus 14 $20,000 for Annabi's vote? 15 A. Yes. 16 Q. You told the government you raised this after June 21st, 17 isn't that right? 18 A. Yes. 19 Q. Do you recall telling the government in your interview of 20 April 30, 2008, sir, that Mr. Jereis asked for money after the 21 September approval vote? 22 A. I don't recall if I said -- 23 Q. If you would look, sir, at the bottom of the second page of 24 the report of your interview of April 30, 2008 to the last 25 paragraph, particularly the concluding two sentences. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1737 C35UANN1 Mangone - cross 1 A. Yes. 2 Q. And then on March 19, 2010, sir, you told the government 3 that it was on July 11 that Mr. Jereis asked for money? 4 A. I didn't say July 11, I don't believe. Sometime in June 5 right after I had come home from Florida. 6 Q. I direct your attention, sir, to the third page of the 7 3517C, particularly the second full paragraph on that page. 8 A. Yes. 9 Q. "There was no exchange of money before the 7/11/2006 vote. 10 Jereis told Mangone that Jereis wanted a payment of the money 11 because the vote by Annabi was ready to go on that date." Do 12 you recall telling the FBI that? 13 A. Yes, but the discussions regarding money with Mr. Jereis 14 was before that date. This was when the first payment was 15 made. 16 Q. Ah. So in your first interview you said Mr. Jereis asked 17 for money in September and now you and I are discussing how in 18 March of 2010 you were telling the government that Mr. Jereis 19 asked for money sometime June or July? 20 A. Yes. Because I wasn't honest with them -- 21 Q. Excuse me, sir. I just asked you if that's what happened. 22 I didn't ask you to explain. 23 A. Yes. 24 Q. And in fact you have already testified that you told the 25 government in March of 2010 that Mr. Jereis was asking for SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1738 C35UANN1 Mangone - cross 1 $20,000, not $10,000? 2 A. That's correct. 3 Q. I take it, it is correct, sir, that in your interview of 4 April 30, 2008, you never expressly told the government when 5 money passed from you to Mr. Jereis? 6 A. That's correct. 7 Q. Nevertheless, on March 19 of 2010, you told the government 8 that the first exchange of money took place shortly after the 9 July 11 vote? 10 A. Yes. 11 Q. And this is the conversation you testified on direct, you 12 went to a restaurant in White Plains and Mr. Jereis called you 13 from his car and you went outside and sat in his car and gave 14 him the money. Do you recall giving that testimony? 15 A. Yes, I do. 16 Q. And it is your testimony that -- as you sit there now, it 17 is your testimony that that's the first time you gave 18 Mr. Jereis money? 19 A. I have given him money for other matters but in this 20 particular instance. 21 Q. On the Longfellow case? 22 A. Yes. 23 Q. On the case where you pleaded guilty? 24 A. That's correct. 25 Q. Where you signed the cooperation agreement -- this is the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1739 C35UANN1 Mangone - cross 1 first time that money was passed? 2 A. That's correct. 3 Q. Now, do you recall talking to the government in April of 4 2010 about when anybody from the Milios brought you money? 5 A. Yes. 6 Q. Do you recall telling the government in your interview of 7 April 30, 2008, that you got money from the Milios after the 8 approval vote? 9 A. Yes. 10 Q. In fact, you told the government in April of 2008 that 11 Antonio Milio, Franco Milio, Romeo Milio and Dominick Miano 12 went to your office with 20,000 dollars cash after the 13 September vote? 14 A. Yes. I told them, but I didn't say Antonio; I said 15 Giuseppe. 16 Q. So here again, the FBI agent that wrote this report wrote 17 it incorrectly? 18 A. I don't know. 19 Q. Well, if you would, sir, look at the bottom of page 2 and 20 see if it reflects Giuseppe as having been part of the 21 committee of Milios that brought you money? 22 A. No, sir. 23 Q. It says Antonio? 24 A. Yes, sir. 25 Q. Nevertheless, you have an explicit recollection that you SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1740 C35UANN1 Mangone - cross 1 told the government on April 30, 2008 that you said Giuseppe 2 and not Antonio? 3 A. I'm pretty certain, sir. 4 Q. Now, in your interview of March 19, 2010, do you recall 5 telling the government who brought you the money in July? 6 A. Yes. 7 Q. Who did you tell the government in your March 19, 2010 8 interview brought you money in July? 9 A. Antonio. 10 Q. Mr. Mangone, I ask you to look at the third page of the 11 report of your interview of March 19, 2010 and if you would be 12 kind enough to look at the paragraph that begins on July 12, 13 sir? 14 A. Yes. 15 Q. Please read the entire paragraph. 16 A. "On July 12, Jereis" -- 17 Q. No, no, not aloud, sir. I'm sorry. I was not clear 18 enough. 19 (Pause) 20 A. Yes. 21 Q. In fact, sir, you don't identify who brought you the money 22 from the Milios in July 2006, do you, sir? 23 A. This report doesn't identify it. 24 Q. In fact this report says you were speaking in passive 25 voice: "Mangone was given the money." That's what it says, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1741 C35UANN1 Mangone - cross 1 isn't that right? 2 A. Yes. 3 Q. There is no identification of any of the Milios relative to 4 the July payment in this report? 5 A. In this report, no. 6 Q. Isn't it a fact that what you did tell the FBI is, you 7 weren't even certain about how much money you passed to 8 Mr. Jereis in July? 9 A. No. 10 Q. You didn't say that to the FBI? 11 A. I don't recall saying that. 12 Q. Now, do you recall, sir, in your interview of April 30, 13 2008 that when Antonio, Franco, Romeo and Dominick Miano 14 brought you the $20,000 in September, you asked, where is the 15 other 10 for Jereis? 16 A. Yes. 17 Q. And you said that to the government on April 30, 2008? 18 A. Yes. 19 Q. But then, sir, in your interview on March 19, you said to 20 the government that it was Franco, Romeo, Giuseppe and Dominick 21 that brought you $20,000 on 9/27? 22 A. That's correct. 23 Q. So in the second interview, Antonio is no longer with the 24 committee but Giuseppe is? 25 A. According to these reports. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1742 C35UANN1 Mangone - cross 1 Q. But you were there, Mr. Mangone? 2 A. I didn't write them. 3 Q. You were there in September of 2006, weren't you, 4 Mr. Mangone? 5 A. Yes, and I told them exactly who was there. 6 Q. Who did you tell them was there? 7 A. Giuseppe, Franco, Romeo and Dominick. 8 Q. And they brought the $20,000 to you in September? 9 A. That's correct. 10 Q. And you said to the committee, where's the 10 for Jereis? 11 A. That's correct. 12 Q. Now, do you recall telling the government that it was 13 Antonio Milio that brought you the last $10,000? 14 A. Yes. 15 Q. In fact, you told the government in your April 30th meeting 16 that that happened the next day, isn't that right? 17 A. On the 27th, yes. 18 Q. So it happened the day after the $20,000? 19 A. No, sir. On the same day. 20 Q. I direct your attention, sir, to page 3 of 3517A and I 21 direct your attention to the paragraph that begins the page and 22 I ask you to read it to yourself. 23 A. Yes. 24 Q. In fact, you told the FBI that Antonio brought you $10,000 25 the next day? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1743 C35UANN1 Mangone - cross 1 A. No. 2 Q. No. So once again the FBI agent wrote it incorrectly? 3 A. I can't say whether he wrote it incorrectly. I know what I 4 told them, though. 5 Q. Do you see there in black and white? 6 A. Yes. 7 Q. In fact it says, the next day Antonio brought you $10,000? 8 A. I understand that's what it says. 9 Q. You sit there on the witness stand, having sworn to tell 10 the truth, telling this jury that Antonio Milio brought you a 11 separate delivery of $10,000 after the September approval vote? 12 A. The next day after the vote, the 27th, I think perhaps it 13 was misinterpreted. 14 Q. So now you have the committee of Milios bringing you 15 $20,000 and Antonio Milio coming separately giving you $10,000 16 all in September of 2006? 17 A. That's correct. 18 Q. Now, it wasn't just these episodes that may have involved 19 the Milios that the FBI asked you about in both April of 2008 20 and in March of 2010, isn't that right? 21 A. They asked me regarding Ridge Hill, too. 22 Q. Well, they asked you other details about your dealings with 23 Mr. Jereis, isn't that right? 24 A. Yes. 25 Q. Now, I believe you told us on direct that you hosted a SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1744 C35UANN1 Mangone - cross 1 Christmas party; I believe, you said it was before the Ridge 2 Hill approval? 3 A. Yes. 4 Q. And you testified in some respects to Mr. Jereis soliciting 5 a position, a consultancy in some manner, shape or form with 6 the developers or with Mr. Pirro? 7 A. Yes. 8 Q. And do you recall testifying on direct that what you said 9 was, you had a party and the next day, Jereis called you and 10 asked about a consultancy? 11 A. The next day or a couple of days after. 12 Q. The next day or a couple days after. This Christmas party 13 was what year? 14 A. 2004. 15 Q. In the year 2004, and you told the government about it in 16 2008 and you told the government about it in 2010 and now you 17 have testified here on the witness stand in the year 2012. You 18 told the government something different on each of those 19 occasions, didn't you, Mr. Mangone? 20 A. I don't believe so. 21 Q. Let's take a look at 3517A again, Mr. Mangone. Now, do you 22 recall telling the government in your April 30th interview in 23 2008 that in December 2004 there was a house holiday party 24 being thrown by your partner Santangelo. Do you recall telling 25 them that? You can look at page 3, the third paragraph. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1745 C35UANN1 Mangone - cross 1 A. Yes. 2 Q. And do you recall telling them that Al Pirro and Jereis 3 were in attendance at the party? 4 A. Yes. 5 Q. Mangone said that Pirro told him he wanted Jereis on board. 6 Do you recall telling them that? 7 A. No. 8 Q. Ah. So you have an explicit recollection now that you told 9 the government in 2008 that the party was Mr. Santangelo's 10 party? That's what you told the government in 2008, isn't it, 11 Mr. Mangone? 12 A. I told them that it was an office party at Mr. Santangelo's 13 house. 14 Q. Is there anywhere in that paragraph where it says an office 15 party? 16 A. Holiday party. 17 Q. Did you say on direct, sir, in this case on Thursday that 18 it was an office party? 19 A. I don't recall. 20 Q. In fact, what you testified to was you threw a Christmas 21 party? 22 A. Sir, I meant the firm. 23 Q. Are there any other answers from Thursday you want to 24 change now while we take a moment? 25 A. No. You can go ahead with your questions. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1746 C35UANN1 Mangone - cross 1 Q. Thank you. 2 In this 302, you described the discussion among 3 Mr. Jereis and Mr. Pirro about Mr. Jereis coming on board as 4 having taken place at the party? 5 A. According to this report. 6 Q. Well, do you recall Mr. Pirro and Mr. Jereis being in 7 Mr. Santangelo's house in Christmas of 2004? 8 A. Yes. 9 Q. And do you recall that you were there? 10 A. Yes. 11 Q. Now, if we could, sir, let's look at what you told the 12 government in March of 2010. If you would go, sir, to page 6 13 of 3517C and if you could, sir, go to the third complete 14 paragraph on that page. 15 A. Yes. 16 Q. Now, in this interview, isn't it a fact, sir, you told the 17 government that Jereis saw Pirro at Santangelo's party? 18 A. Yes. 19 Q. You do not recite, sir, that you are in fact there, do you? 20 In the 302, does it recite that you are there? 21 MR. CARBONE: Judge, I object to that. He had to have 22 been there if he saw Mr. Jereis. 23 MR. SIANO: The 302 doesn't say that, Judge. 24 THE COURT: If that was an objection, the objection is 25 overruled. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1747 C35UANN1 Mangone - cross 1 A. The report does not reflect that I was there. 2 Q. In fact, it says that you called Pirro to talk about what 3 Jereis told you? 4 A. When Zehy came to my office, yes. 5 Q. This 302, sir, does not reflect that you, Zehy Jereis, and 6 Al Pirro were all together at the 2004 Christmas party 7 discussing the consultancy for Mr. Jereis, does it? 8 A. No, it doesn't. 9 Q. Now, when you went in to see the FBI in April of 2008, you 10 didn't just talk about your own criminality, did you? 11 A. I don't understand the question. 12 13 (Continued on next page) 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1748 C35Qann2 Mangone - Cross 1 BY MR. SIANO: 2 Q. You told this jury that you had been in a car with Franco 3 Milio, and he was furtive and shifty, and you thought he was 4 wired up, didn't you? 5 A. Yes. 6 Q. So when you went in on April 30 and talked to the FBI and 7 the prosecutors, you told them some things about the Milios, 8 didn't you? 9 A. Yes. 10 Q. You told the FBI and the government on April 30 that your 11 clients, the Milios, were not declaring all their income on 12 their tax returns? 13 A. Yes. 14 Q. And you told the government about your clients, that they 15 were using a work force of illegal aliens being paid off the 16 books, isn't that right? 17 A. Yes. 18 Q. And you described them to the government in your interview 19 of April 30 as cheap bastards? 20 A. Yes. 21 Q. At any point when you studied professional responsibility 22 at St. John's, did they tell you that betraying client 23 confidence was acceptable in a proffer? 24 A. No. 25 Q. I take it you and Mr. Santangelo when you were creating SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1749 C35Qann2 Mangone - Cross 1 your brilliant defense didn't talk about the Milios cash 2 payroll and their non-reported earnings? 3 A. No. 4 Q. You came up with that on your own? 5 A. It was related to questions regarding a subpoena. 6 Q. And you decided in that proffer session to tell the 7 government about the Milios? 8 A. It was related to the answers I gave regarding the 9 subpoena. 10 Q. Did you ever assert attorney-client privilege at any time 11 in that meeting? 12 A. I was referring to questions related to a subpoena. 13 THE COURT: It's a yes or no question. 14 Q. Did you assert privilege? 15 A. No. 16 Q. Did anybody show you a document of any kind that relieved 17 you of your obligations as an attorney for the Milios? 18 A. No. 19 Q. So you just decided it was OK to give up the Milios on 20 April 30, 2008? 21 A. No. 22 Q. Well, you gave them up during what you described earlier 23 today as an innocence proffer, isn't that right? 24 A. It started as an innocence proffer. 25 Q. Right. And you decided that it was in your best interest SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1750 C35Qann2 Mangone - Cross 1 on April 30 of 2008 to tell the government the bad things your 2 clients were doing? 3 A. No. 4 Q. Now, I asked you some questions, sir, on Thursday about 5 your gambling habit, do you recall those questions? 6 A. Yes. 7 Q. You testified on direct that there was some point at which 8 you were banished from a casino due to some irregularity 9 involving markers? 10 A. I think they cut off my credit line. 11 Q. Now, you know for a fact, sir, that if you put cash through 12 the window and get chips, the casino gives you back cash, isn't 13 that right? 14 A. I don't follow the question. 15 Q. Well, in Atlantic City, sir, isn't it a fact that if you 16 draw chips on a marker and gamble, if you bring back the chips, 17 the first thing the casino does is pay down your marker? 18 A. Not necessarily. 19 Q. It's your testimony, sir, that you can write a marker at an 20 Atlantic City casino, draw chips, walk around for awhile and 21 then put the chips back through the window and get cash back? 22 A. It depends on the hotel. 23 Q. Now, have you ever used a third party to cash chips for 24 you? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1751 C35Qann2 Mangone - Cross 1 Q. From time to time in those casinos that wouldn't give you 2 back cash, you passed your chips to a third party to push them 3 through the window so you could get cash back? 4 A. Yes. 5 Q. In fact, you had heard about this from somebody else, 6 right? You didn't invent this particular way to get cash, did 7 you? 8 A. I don't recall who I heard it from. 9 Q. You don't recall who you heard it from? Isn't it a fact 10 that you told the government that Nick Spano told you this is 11 the way he got cash from third parties at the casinos? 12 A. That's not the question that you asked me, sir. 13 MR. CARBONE: Objection. 14 Q. It's the question I'm asking you now. 15 MR. CARBONE: Objection. 16 THE COURT: The objection is sustained. 17 Q. Did you discuss with third parties the practice of passing 18 chips from one person to another to get cash back? 19 A. Yes. 20 Q. And other persons told you that they had done that? 21 MR. CARBONE: Objection. Hearsay. 22 THE COURT: Overruled. 23 Q. You can answer. 24 A. Oh, I apologize. Yes, I've discussed having third 25 parties -- and I've had third parties do that for me. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1752 C35Qann2 Mangone - Cross 1 Q. Now, did you ever have Mr. Santangelo do that for you? 2 A. Yes. 3 Q. Did you ever have your office assistant Jill Allen do that 4 for you? 5 A. No. 6 MR. CARBONE: Objection. 7 THE COURT: Overruled. 8 Q. Do you recall telling Franco Milio when he was discussing 9 with you the fact that he had told Santangelo about the cash, 10 do you recall telling Franco Milio that no one other than 11 Franco, his father, Antonio, you and Michael Santangelo were 12 aware of the money that had passed from the Milios to you? 13 A. I don't specifically recall giving him that. 14 Q. I want to show you and endeavor to refresh your 15 recollection. Grand jury testimony September 9, 2008, Franco 16 Milio, page 34. If you could just read, sir, as much as you 17 want, but I'm directing your attention to lines 8 through 13. 18 A. Do you want me to read it aloud? 19 Q. No, no, no. Don't do that. 20 A. OK. 21 Q. Does that help refresh your recollection, sir? 22 A. That's not my testimony, no. 23 Q. I didn't ask if it was your testimony. I just asked -- 24 THE COURT: He asked if it jogged your memory. Does 25 it? Yes or no. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1753 C35Qann2 Mangone - Cross 1 THE WITNESS: Oh. No. 2 THE COURT: OK. 3 Q. Now, also in connection with the Milios, you gave an 4 interview in or about September of 2010, September 17, 2010, in 5 which you discussed with the government the fact that the 6 Milios were turning their cash into checks through the use of a 7 third party. Do you recall talking to them about that? 8 A. Yes. 9 Q. In fact, you identified for the government a gentleman by 10 the name of Joe Smiley, isn't that right? 11 A. Yes. 12 Q. Now, Mr. Smiley wasn't christened Smiley, was he? 13 A. No. 14 Q. He was christened Ricciardi, isn't that right? 15 A. I believe so. 16 Q. And you told the government Joe Smiley Ricciardi was the 17 son of Tony Ricciardi, isn't that right? 18 A. I believe so. 19 Q. And you told the government that the Milios had used your 20 escrow account to pass cash to Joe Smiley and Tony Ricciardi in 21 connection with a Milio real estate transaction? 22 A. I believe what I had told them was that I received funds 23 from a Mr. Ricciardi. 24 Q. Well, didn't you tell the government that Mr. Smiley 25 Ricciardi had told you that his father would take cash from SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1754 C35Qann2 Mangone - Cross 1 individuals in exchange for money to be wired into a bank 2 account? 3 A. No. I believe I told them that Mr. Ricciardi had wired 4 money to my account, and that in the past that was a practice 5 that they used to engage in. 6 Q. Oh. Let me show you what's been marked as 3517-Q, sir, and 7 I ask you if you could read the paragraph that begins "Joe 8 Smiley." 9 A. OK. 10 Q. Now, you told the government that what Mr. Smiley told you 11 was that his father launders money, launders cash money for 12 people? 13 MR. CARBONE: Objection. 14 THE COURT: First of all, there's no question pending. 15 MR. CARBONE: Well, I think he -- 16 Q. Isn't that a fact? 17 THE COURT: Now we have a question. 18 MR. SIANO: Thank you, Judge. 19 MR. CARBONE: Objection. Relevance. 20 THE COURT: The objection is sustained. 21 Q. All right. Did you tell the Milios about the service that 22 the Ricciardis provided? 23 A. Did I tell the Milios? 24 Q. Yes. 25 A. This is someone that they had a relationship with for SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1755 C35Qann2 Mangone - Cross 1 years. 2 Q. Nevertheless, in this transaction, isn't it a fact that 3 your escrow account was used so the Milios could give the 4 Ricciardis cash, and you would have funds for a closing for 5 checks to be written out of your escrow? 6 A. They sent -- Mr. Ricciardi sent me money to my escrow 7 account, that's correct. 8 Q. And you used it for a Milio real estate closing? 9 A. Yes. 10 Q. And Mr. Milio told you he had given Ricciardi the cash? 11 A. He had said that -- 12 MR. CARBONE: Objection. Hearsay. 13 THE COURT: The objection is sustained. 14 Q. Did you ask your clients where the Ricciardi money had come 15 from? 16 A. No, I did not. 17 Q. Isn't it a fact that the Milios told you they wanted to 18 close the real estate transaction in cash? 19 A. Yes. 20 Q. And isn't it a fact that the Milios told you that the 21 seller wouldn't take cash? 22 MR. CARBONE: Objection. Hearsay. 23 THE COURT: Objection is sustained. 24 Q. Now, the money that was wired to you, you put in your 25 attorney trust account? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1756 C35Qann2 Mangone - Cross 1 A. Yes. 2 Q. You saw that the money came from the Ricciardi interests, 3 isn't that right? 4 A. Yes. 5 Q. Nevertheless, you used it so that the Milios could buy a 6 piece of real property? 7 MR. CARBONE: Objection. Asked and answered. 8 THE COURT: Overruled. 9 A. Yes. 10 Q. Isn't it a fact, sir, that you told the government that 11 this process that the Milios were using was a way in which the 12 Milios in your words cleaned up cash? 13 A. Yes. 14 Q. Now, when you were in law school, sir, did you cover the 15 topic of money laundering? 16 A. Yes. 17 Q. And I take it based on your training and experience before 18 you were disbarred in the year 2006, you knew what was going on 19 with the Milios was money laundering, didn't you -- 20 MR. CARBONE: Objection. 21 THE COURT: Overruled. 22 A. Not necessarily. 23 Q. Not necessarily. Now, I direct your attention to 3517-O, 24 page 4, sir. 25 MR. CARBONE: I'm sorry, Mr. Siano, what is that SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1757 C35Qann2 Mangone - Cross 1 Exhibit? 2 MR. SIANO: 3517-O, the next to last paragraph 3 Mr. Carbone. 4 MR. CARBONE: Thank you. 5 Q. Isn't it a fact that you told the FBI in, I believe, June 6 of 2010 that what the Milios were doing was cleaning up 7 undeclared earnings? 8 A. Undeclared cash, sir. 9 Q. Undeclared cash? 10 A. Yes. 11 Q. Did you believe at the time it was perhaps soiled? 12 A. No. 13 Q. Did you believe at the time it needed to be dry cleaned or 14 laundered? 15 A. No. 16 MR. CARBONE: Objection. Argumentative. 17 THE COURT: The objection is sustained. 18 Q. Isn't it a fact that you used those exact words with the 19 FBI agent, cleaned up, isn't that right? 20 A. Yes. 21 Q. And you meant the Milios in your view were laundering the 22 money, isn't that right? 23 A. Yes. 24 MR. CARBONE: Objection. 25 THE COURT: Overruled. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1758 C35Qann2 Mangone - Cross 1 Q. On how many occasions did the Milios use bank accounts 2 associated with you or your firm in total? 3 A. Dozens. 4 Q. How many times were they cleaning up cash money? 5 A. I don't know, sir. 6 Q. More than once? 7 A. No. 8 Q. Now, I believe you told the FBI when you were interviewed 9 by them that you were hiding your gambling losses from your 10 spouse, isn't that right? 11 A. Yes. 12 Q. Would you agree with me, sir, that you put in excess of 13 $160,000 through the windows of casinos in the year 2006? 14 A. Yes. 15 Q. And that you posted markers in order to get chips in 2006 16 in excess of $170,000? 17 A. Yes. 18 Q. It was those expenditures in that year and other 19 expenditures in 2004, 2005, 2007 and 2008 that you were hiding 20 from your wife, isn't that right? 21 A. Yes. 22 Q. Nevertheless, you showed your wife winnings, isn't that 23 what you told the FBI? 24 A. Yes. 25 Q. You weren't suggesting to the FBI, sir, that you were a net SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1759 C35Qann2 Mangone - Cross 1 winner at these casinos, were you? 2 A. No, sir. 3 Q. Now, in connection with the services that you provided to 4 Mr. Spano, did he from time to time cause money to be paid to 5 third parties on your behalf? 6 A. I don't understand the question. 7 Q. Well, Donna Mangone is a nurse, isn't that right? 8 A. No, sir. 9 Q. Well, what is her training? 10 A. She works for a -- right now she works for a medical supply 11 company. 12 Q. What did she -- for whom did she work in the years 2002 -- 13 MR. CARBONE: Objection. Relevance. 14 Q. -- and 2003? 15 THE COURT: The objection is sustained. 16 Q. Isn't it a fact that Mr. Spano passed money to you through 17 sham payments to Donna Mangone? 18 A. No, sir. 19 Q. I show you what's been marked for identification as 20 Defendant's Exhibit 63. You see the sums reflected there, sir? 21 Don't read them aloud. 22 A. Yes. 23 Q. In Defense Exhibit 63 for identification, is it your 24 testimony, sir, that your wife provided consulting services to 25 The Friends of Nick Spano Committee in the year 2002 and 2003? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1760 C35Qann2 Mangone - Cross 1 A. She worked on the campaign. 2 Q. She worked on the campaign. Was she a paid worker on the 3 campaign? 4 MR. CARBONE: Objection. Relevance. 5 THE COURT: The objection is sustained. 6 Q. Is it your recollection, sir, that Donna Mangone was paid 7 $27,000 in connection with working on Mr. Spano's campaign? 8 MR. CARBONE: Objection. 9 THE COURT: Sustained. 10 Q. Now, you recall, sir, entering a guilty plea in connection 11 with the transaction at Longfellow in front of a magistrate 12 judge in White Plains on or about November 29, 2010? 13 A. Yes. 14 Q. And you recall during that plea the magistrate judge 15 specifically asked you what it was that you had done to warrant 16 you pleading guilty? 17 A. Yes. 18 Q. And do you recall you being sworn at that time and giving 19 the answer under oath? 20 A. Yes. 21 Q. It's the same oath you gave here on Thursday? 22 A. Yes. 23 Q. The same oath you gave in the Wedra grand jury? 24 A. Yes. 25 Q. Same oath you gave in the Wedra trial? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1761 C35Qann2 Mangone - Cross 1 A. Yes. 2 Q. Do you recall specifically telling the magistrate judge 3 that you had paid tens of thousands of dollars as a bribe in 4 connection with Longfellow? 5 A. Yes. 6 Q. You didn't say $10,000. 7 THE COURT: Did you? 8 A. No. 9 Q. Did you? You didn't say $20,000, did you? 10 A. No. 11 Q. You didn't say $30,000, did you? 12 A. No. 13 Q. I want to focus specifically on the years 2005 and 2006. 14 You have testified, sir, that you were providing cash payments 15 to Mr. Leibell in 2005 and 2006, isn't that right? 16 A. Yes. 17 Q. You testified that you also made cash payments to somebody 18 associated with Mr. Leibell on a monthly basis in 2005, isn't 19 that so? Mr. Lodes? 20 A. Yes. 21 Q. And, in addition, you also made payments to another 22 individual in connection with the town of Carmel, isn't that 23 right? 24 A. No, we made campaign contributions. 25 Q. This was Mr. Posey? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1762 C35Qann2 Mangone - Cross 1 A. Yes. 2 Q. Was the use of your credit card a campaign contribution? 3 A. I don't believe we gave Mr. Posey our credit card. 4 Q. Mr. Mangone, do you have -- isn't it a fact, sir, that you 5 gave money to Senator Leibell for the express purpose of giving 6 that money to Mr. Posey? 7 A. Yes. 8 Q. So in 2006 you and your partners were giving money to 9 Senator Leibell, you're giving money to Mr. Lodes, and you're 10 giving money to Mr. Posey through Senator Leibell? 11 A. Yes. 12 Q. And, in addition, you also testified on Thursday that you 13 also as part of a deal to get new business were paying what we 14 might call an unproductive associate, isn't that correct? 15 A. Yes. 16 Q. Mr. Mangone, from time to time prior to your appearance 17 here in court today, would it be fair to say that you have 18 abused alcohol? 19 A. Yes. 20 Q. In fact, you so recited at or about the time you were 21 arraigned in this case, isn't that right? 22 A. I -- 23 Q. Did you tell pretrial services that in January of 2010 you 24 were drinking four to five alcoholic beverages a day? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1763 C35Qann2 Mangone - Cross 1 Q. Isn't it a fact, sir, that from time to time during the 2 events in this case, you also have abused prescription drugs, 3 isn't that right? 4 A. Yes. 5 Q. Now, you were asked some questions on direct about the 6 Independence Party primary and your passing $5,000 to an 7 individual named John Khader, isn't that right? 8 A. Yes. 9 Q. And you testified that it was $10,000 that Mr. Khader asked 10 for, is that correct? 11 A. Yes. 12 Q. But, in fact, you got $15,000 from your Republican Party 13 been factors, isn't that right? 14 A. I don't recall exactly how much I got from them. 15 Q. Well, you told them you wanted the last five for your 16 taxes, isn't that right? 17 A. Yes. 18 Q. And you put all that money in your bank account, isn't that 19 right? 20 A. Firm account. 21 Q. And you kept ten of it yourself, isn't that right? 22 A. No, only five. 23 Q. You gave five to Mr. Khader. What happened to the other 24 ten? 25 A. It was only 10,000 that the check was for. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1764 C35Qann2 Mangone - Cross 1 Q. Now, Mr. Mangone, you have in front of you 3517-C? 2 A. Yes, I do. 3 Q. That's your interview right after you were indicted in this 4 case, isn't that right? 5 A. Yes. 6 Q. And the stakes were pretty high for you at that time, 7 weren't they, Mr. Mangone? 8 A. Yes. 9 Q. Your brilliant defense had failed, isn't that correct? 10 A. No. 11 Q. Well, the brilliant defense that you and Mr. Santangelo 12 talked about calling the payment to Mr. Jereis a consultancy, 13 that had failed to dissuade the government, hadn't it? 14 A. Yes. 15 Q. So you went in with your new lawyer at your elbow in March 16 of 2010 knowing that it was very important for you to be 17 truthful, isn't that right? 18 A. Yes. 19 Q. Did you try to be truthful that day, sir? 20 A. Yes. 21 Q. Now, you recall being asked during that interview if you 22 had reviewed Mr. Jereis's consulting agreement with Forest City 23 Ratner? 24 A. Yes. 25 Q. And you recall that you told the government after you were SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1765 C35Qann2 Mangone - Cross 1 indicted that you reviewed Zehy Jereis's consulting agreement 2 with Forest City Ratner before the July 11, 2006 vote? 3 A. I don't believe that's what I said. I said I didn't recall 4 when it came in. 5 MR. SIANO: If I might have a moment, your Honor. 6 Q. Mr. Mangone, I direct your attention to 3517-C, the bottom 7 of page 6 and the top of page 7. Please read the last sentence 8 on six continuing on to page 7. 9 A. Yes. 10 Q. Now, sir, I ask you again, isn't it a fact, sir, that after 11 you were indicted in this case, you went into the government 12 with Mr. DeVita, and you told the government you reviewed 13 Mr. Jereis's draft agreement with FCR at a point in time before 14 Sandy Annabi voted in favor of the Ridge Hill project? 15 A. No, I said it could have been sometime before. I didn't 16 know exactly when. 17 Q. Does that report say "it could have been sometime before I 18 don't know when"? 19 A. No, it doesn't. 20 Q. In fact, that report says exactly what I said to you, isn't 21 that right? 22 A. Yes, it does. 23 Q. And you're saying that the FBI agents wrote it down wrong? 24 A. I'm saying that that's what the report says. 25 Q. I ask you now under oath, sir, did you see that draft SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1766 C35Qann2 Mangone - Cross 1 agreement? 2 A. Yes, I did. 3 Q. When did you see it? 4 A. I don't recall, sir. 5 Q. You have no recollection? 6 A. I don't know. I don't know if it was before or after the 7 agreement -- after the vote on the 11th. 8 Q. How close to the vote on the 11th was it? 9 A. Sometime close to it. 10 Q. Very close to the vote? 11 A. Yes. 12 Q. And that testimony you're giving now on cross-examination 13 is as truthful as everything else you've said to this jury, 14 isn't it? 15 MR. CARBONE: Objection. Argumentative. 16 THE COURT: The objection is overruled. 17 A. Yes. 18 MR. SIANO: Thank you. No further questions. 19 THE COURT: Let's take a break. Don't discuss the 20 case. Keep an open mind. 21 (Jury recessed) 22 (In open court; jury present) 23 MR. ARONWALD: May I, your Honor? 24 THE COURT: Mr. Aronwald. 25 CROSS-EXAMINATION SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1767 C35QANN2 Mangone - Cross 1 BY MR. ARONWALD: 2 THE COURT: You are still under oath, sir. 3 Q. Good morning, Mr. Mangone. 4 A. Good morning, Mr. Aronwald. 5 Q. Mr. Mangone, let me first ask you some questions about the 6 money that you say that you passed to Mr. Jereis. 7 A. Yes, sir. 8 Q. Just so that it's clear. You don't know what Mr. Jereis 9 did with any of the money that you say you gave to him, 10 correct? 11 A. That is correct. 12 Q. In fact, you never had any discussions or conversations or 13 exchange of communications with Sandy Annabi concerning the 14 payment of any money to her in exchange for her voting to 15 approve the resolution designating Milio Management as 16 Longfellow developer isn't that so? 17 A. That is correct. 18 Q. Once you passed the money that you say you gave to 19 Mr. Jereis, you never asked Ms. Annabi whether or not 20 Mr. Jereis had given any of that money to her, isn't that 21 correct? 22 A. That is correct. 23 Q. So as you sit here today, you don't know whether Ms. Annabi 24 ever received any money in exchange for her voting to designate 25 Milio Management as the developer for the Longfellow project, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1768 C35QANN2 Mangone - Cross 1 isn't that so? 2 A. That's correct. 3 Q. Now, Mr. Siano asked you a series of questions concerning 4 the various FBI 302 reports that were prepared in connection 5 with this case relating to the meetings that you had with 6 representatives of the government, correct? 7 A. Yes. 8 Q. On a number of those occasions when you met with the 9 government, not only were FBI Agents Mazzuca and Caroline 10 Gilmore present, but indeed Assistant United States Attorneys 11 Halperin or Carbone, either one or the other or both were also 12 present, correct? 13 A. Yes, sir. 14 Q. Now, as to each or any of those meetings, did you prepare 15 any notes, memoranda or documents memorializing what you told 16 them and what they said to you? 17 A. No, sir. 18 Q. To your knowledge -- withdrawn. When you met with the 19 government during the first interview, you were represented -- 20 you were accompanied by Barry Levin, an attorney who you had 21 hired, to represent you in connection with this case, correct? 22 A. Yes. 23 Q. Thereafter, you terminated the services of Mr. Levin and 24 retained the services of James DeVita to represent you in 25 connection with this case, correct? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1769 C35QANN2 Mangone - Cross 1 A. Yes, sir. 2 Q. Now, you testified that Mr. Stiso, Pat Stiso -- whose true 3 name is Pasquale Stiso, correct? 4 A. Yes. 5 Q. -- was present during some of the strategizing that took 6 place between you, Michael Santangelo and Mr. Stiso to discuss 7 a defense or strategy concerning these allegations, correct? 8 MR. CARBONE: Objection. Misstates the testimony. 9 THE COURT: Misstates his testimony. The witness is 10 perfectly capable of saying "That's not what I said." 11 A. I don't recall that to be the testimony, sir. I did have 12 conversations with him. 13 Q. You had conversations with Mr. Stiso, you testified earlier 14 that Mr. Stiso was a disbarred attorney? 15 A. Yes. 16 Q. Correct? 17 He was disbarred as a result of a federal conviction 18 for which he was sent to prison, correct? 19 A. Yes. 20 Q. Do you recall what the conviction was for? 21 A. Something drug related. 22 Q. Drug related. Selling drugs? 23 A. I don't -- I don't know the exact. It was a conspiracy 24 charge. 25 Q. Do you recall what the drug was? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1770 C35QANN2 Mangone - Cross 1 A. No, I do not. 2 Q. Now, did there come a time when Mr. Stiso basically was in 3 your law offices on a fairly regular basis? 4 A. Yes. 5 Q. What, if any, services did he provide to the law firm 6 during the period of time that he was in the office? 7 A. He was a prison consultant. We had clients who would be 8 going to prison; he would consult with them. On real estate 9 matters helping us getting surveys, he worked with a title 10 company, things of that nature. 11 Q. Were any of the client matters that were in the office, 12 were these matters that you asked him to work on? 13 A. Yes. 14 Q. In connection with -- 15 MR. CARBONE: Objection. Relevance. 16 THE COURT: There is no question pending. 17 MR. CARBONE: As to the last question. 18 THE COURT: A little late. The answer is on the 19 record. Let's go on to the next question. 20 Q. When you say that you assigned Mr. Stiso to some of the 21 client matters that were in the office, what types of services 22 did Mr. Stiso provide to those clients? 23 MR. CARBONE: Objection. 24 THE COURT: Sustained. 25 Q. You knew that Mr. Stiso had been disbarred, correct? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1771 C35QANN2 Mangone - Cross 1 MR. CARBONE: Objection. 2 THE COURT: Sustained. You've made the point. Let's 3 move on. 4 Q. Were you aware that Mr. Stiso as a disbarred attorney was 5 not permitted to engage in the practice of law? 6 MR. CARBONE: Objection. 7 THE COURT: I'll let him answer that question. 8 Did you know that, sir? 9 THE WITNESS: Yes. 10 Q. OK. And were the services that you asked Mr. Stiso to 11 provide to clients included within the definition as you 12 understood it of the practice of law? 13 A. No. 14 Q. To your knowledge, did he provide any advice to clients? 15 THE COURT: The objection is sustained. The question 16 has been answered. Let's move on off this matter of marginal 17 relevance on to something more relevant, please. 18 Q. With respect to Murray Richman when you say that you met 19 with Murray Richman, you met with him for the purpose of 20 consulting with him in an attorney/client type capacity, 21 correct? 22 A. Yes. 23 Q. Concerning the Longfellow issue, right? 24 A. Yes. 25 Q. And you say that at some point during the discussion SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1772 C35QANN2 Mangone - Cross 1 Mr. Richman told you that he was representing Sandy Annabi in 2 connection with the investigation, correct? 3 A. Yes. 4 Q. In reference to the discussion that you had with him 5 concerning advice that he would give you relating to the 6 Longfellow allegations, using that as your reference point, did 7 Mr. Richman tell you that he was representing Sandy Annabi 8 before or after you explained to him that you were there to 9 consult with him concerning Longfellow? 10 A. He didn't give me any advice. 11 Q. You were there to consult with him concerning Longfellow, 12 correct? 13 A. Yes. 14 Q. If you weren't there for his advice, for what reason were 15 you there? 16 A. We just spoke in general terms, and then when he found out 17 what the nature of it was, he referred me to a few lawyers, 18 including yourself. 19 Q. At that point, did Mr. Richman when you discussed with 20 Mr. Richman the Longfellow issues, was it only after you raised 21 the subject of Longfellow that Mr. Richman told you that he was 22 representing Sandy? 23 A. I don't recall exactly. 24 Q. Now, you testified that you were disbarred in the spring of 25 2011? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1773 C35QANN2 Mangone - Cross 1 A. Yes, sir. 2 Q. Since that time, what have you been doing to support 3 yourself or your family? 4 MR. CARBONE: Objection. Relevance. 5 THE COURT: The objection is sustained. 6 Q. Actually, you pled guilty on November 29 of 2010, correct? 7 A. Yes. 8 Q. As an attorney, you know that in New York State you are 9 disbarred effective the date of your plea, you know that, don't 10 you? 11 A. No. 12 Q. You were not aware of the fact that in New York State the 13 law is that if you plead guilty to a felony, you are 14 automatically disbarred as of the date of your guilty plea? 15 A. I thought it was the date of the sentence. 16 Q. But the fact of the matter is that even after you pled 17 guilty on November 29 of 2010, you continued to practice law, 18 didn't you? 19 A. Yes. 20 Q. And you did that with the knowledge of the government? 21 A. Yes, and with the advice of counsel. 22 Q. OK. With the advice of counsel. Regardless of the advice 23 of counsel, did the government have any objection or indication 24 to you that they thought you should not be practicing law once 25 you pled guilty to a felony? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1774 C35QANN2 Mangone - Cross 1 A. We didn't go into it, sir. 2 Q. You didn't go into it. You did in fact appear before the 3 Honorable Richard Molea, M-O-L-E-A, a Westchester County 4 Supreme Court Justice, on February 9, 2011 in the case of 5 people of the State of New York against Andrew and Sandra 6 DeSimone, correct? 7 A. Yes. 8 Q. And after your guilty plea, you also appeared in other 9 matters on behalf of other clients until the spring of 2011, 10 correct? 11 A. Yes. 12 MR. ARONWALD: Can we have a sidebar, your Honor? 13 THE COURT: You couldn't have done this on the 15 14 minute break? You must have known this was going to happen. 15 MR. ARONWALD: I'm sorry, Judge. Your Honor, I think 16 we handed the case up to you last week. 17 THE COURT: I'm not giving anybody any instructions 18 now. You ask a question. If that's what you want a sidebar 19 for, you ask questions. 20 Q. Since you stopped practicing law, have you been employed or 21 engaged in the operation of any licensed business? 22 MR. CARBONE: Objection. Relevance. 23 THE COURT: Overruled. 24 A. Yes. 25 Q. What type of business was that? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1775 C35QANN2 Mangone - Cross 1 A. One is a general contracting firm and one is a restaurant. 2 Q. What's the name of the general contracting firm? 3 A. Aspen Design. 4 Q. What kind of contracting services does that provide? 5 A. Interior -- 6 MR. CARBONE: Objection. Relevance. 7 THE COURT: Overruled. 8 A. Interior commercial buildout. I'm a consultant for them. 9 Q. Do you have a background in that type of work? 10 A. Generally, yes. 11 Q. When did you develop that background? 12 A. Real estate and development work that I have -- 13 THE COURT: The objection is sustained. We have gone 14 as far down that road as we need to go. 15 Q. The name of the restaurant is what? 16 A. Full Moon Trattoria. 17 Q. Is that owned in your name? 18 A. No, sir. 19 Q. What is the name of the owner? 20 MR. CARBONE: Objection. 21 THE COURT: The objection is sustained. 22 Q. That is a licensed premises, isn't it? 23 A. Yes. 24 Q. You understand when I say licensed premises, I mean it's 25 licensed by the New York State Liquor Authority to dispense SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1776 C35QANN2 Mangone - Cross 1 alcoholic beverages, correct? 2 A. Yes. 3 Q. And an application had to be filed with the New York State 4 Liquor Authority in order to obtain that license, that's 5 correct also, isn't it? 6 A. Yes, sir. 7 Q. Did you own that restaurant before or after you pled guilty 8 in this case? 9 MR. CARBONE: Objection. Misstates the testimony. He 10 never said he owned it. 11 THE COURT: Once again, Mr. Carbone, Mr. Mangone was a 12 law school graduate. He is quite capable of telling 13 Mr. Aronwald if he's understood something. 14 Mr. Mangone. 15 A. Yes. Sir, I'm not an owner there. I have a consulting 16 agreements with the restaurant. 17 Q. When did you have that consulting agreement with the 18 restaurant before or after your guilty plea? 19 A. After. 20 Q. The restaurant didn't open until after your guilty plea, 21 correct? 22 A. Yes. 23 Q. OK. The name of the owner is JSAML, Inc. isn't that so? 24 MR. CARBONE: Objection. Relevance. 25 THE COURT: The objection is sustained. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1777 C35QANN2 Mangone - Cross 1 Q. Don't the initials AM stand for Anthony Mangone? 2 MR. CARBONE: Objection. 3 THE COURT: The objection is sustained. Let's move 4 on, please. 5 Q. By the way, at the time that you say that you gave money to 6 Zehy Jereis, there were no witnesses to that, were there? 7 A. No, sir. 8 Q. So we only have your word for that, correct? 9 A. Yes, sir. 10 Q. And with respect to your word, you've admitted that you 11 have lied under oath in previous instances, haven't you? 12 A. Yes, sir. 13 Q. In fact, your lies have not only been limited to those 14 instances where you've been testifying under oath, have they? 15 A. I don't understand the question. 16 Q. Well, you lied to the government during your initial 17 interview when you told the government that any money you gave 18 to Zehy Jereis was a consulting fee. That was a lie, wasn't 19 it? 20 A. Yes, sir. 21 Q. Before you ever went into the grand jury to testify in the 22 Wedra case, you were interviewed by members of the district 23 attorney' office in Westchester County, correct? 24 A. Yes. 25 Q. That was to prepare you for your grand jury testimony, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1778 C35QANN2 Mangone - Cross 1 wasn't it? 2 A. Yes. 3 Q. It was also to interview you to determine what, if any, 4 information you had concerning the forgery of those absentee 5 ballots, correct? 6 A. Yes. 7 Q. Do you remember meeting with an assistant district attorney 8 by the name of Edward Saslaw? 9 A. Yes. 10 Q. He was the prosecutor in that case, wasn't he? 11 A. Yes. 12 Q. When you met with him, he asked you whether or not Senator 13 Spano had been involved in connection with the forgery of those 14 ballots, didn't he? 15 A. Yes. 16 Q. And you told him no, didn't you? 17 A. I told him he had no knowledge. 18 Q. He had no knowledge. But that wasn't true, was it? 19 A. No. 20 Q. You lied to the district attorney, correct? 21 A. Yes. 22 Q. And you didn't feel the least bit guilty about it after you 23 did it, did you? 24 A. No. 25 Q. Then there came a time when you went before a grand jury, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1779 C35QANN2 Mangone - Cross 1 correct? 2 A. Yes. 3 Q. Just so we're clear, the grand jury consists of a number of 4 people, 23 is the maximum, the only other people in the grand 5 jury other than the grand jurors are you, the witness, the 6 prosecutors who asks you questions, and the court reporter, 7 correct? 8 A. Yes. 9 Q. There's no judge there, correct? 10 A. No. 11 Q. There's no defense lawyer there, correct? 12 A. No. 13 Q. You were asked questions by Mr. Saslaw concerning your 14 involvement in the forgery of those absentee ballots, correct? 15 A. Yes. 16 Q. One of the questions you were asked was whether or not 17 Senator Nicholas Spano had any involvement in that scheme, 18 didn't you -- that was one of the questions that you were 19 asked, correct? 20 A. I think the question was if you have any knowledge. 21 Q. Yes, that was the question. You knew that Senator Spano 22 did, in fact, have knowledge, didn't you? 23 A. Yes. 24 Q. You lied under oath to the grand jury -- 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1780 C35QANN2 Mangone - Cross 1 Q. -- correct? 2 And you didn't feel the least bit guilty about that, 3 did you? 4 A. I did feel that I was -- I did feel guilty about that. 5 Q. You felt guilty about it but not guilty enough that when it 6 came time to try the case and for you to go before a trial 7 jury, you lied under oath there too when you said that Senator 8 Spano did not have any knowledge, correct? 9 A. Yes. 10 Q. So whatever guilt you felt when you went before the grand 11 jury, you were not so overcome by it that you didn't find it 12 easy to go into the trial court and lie then under oath, did 13 you? 14 A. Correct. 15 Q. And the reason you did that was not to protect yourself but 16 to protect your mentor Senator Spano, correct? 17 A. Yes. 18 Q. By the way, just getting back to Longfellow, you never had 19 any discussions with Sandy Annabi concerning her position on 20 the Longfellow project, did you? 21 A. No. 22 Q. You knew at the time -- withdrawn. Did you know at the 23 time that you first had your discussions with the Milios about 24 Longfellow, did you know at that time that the vote on the city 25 council was four to three against designating Milio as the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1781 C35QANN2 Mangone - Cross 1 developer of Longfellow? 2 A. No. 3 Q. But you did know from your experience that all that was 4 required to pass the resolution was a simple majority vote of 5 four to three, correct? 6 A. Yes. 7 Q. OK. Did you know who the three people -- did you know who 8 the four people were that were opposed to designating Milio as 9 the developer? 10 A. No. 11 Q. So it's your testimony that you were not aware that Dee 12 Barbato, John Murtagh and Pat MacDow along with Sandy were the 13 ones opposed to the designation? 14 A. It was in committee. 15 Q. But you knew -- did you ever attend any of the real estate 16 committee meetings before the resolution was passed on 17 September 26 of 2006? 18 A. No. 19 Q. Did you ever attend any of the city council meetings 20 concerning Longfellow before the resolution was passed on 21 September 26 of 2006? 22 A. No. 23 Q. Did you ever speak to any city council member concerning 24 the Longfellow resolution before September 26 of 2006? 25 A. No. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1782 C35QANN2 Mangone - Cross 1 Q. You testified that there came a time when you were on 2 vacation in West Palm Beach with your family? 3 A. Yes. 4 Q. And that was between June 21 and June 24 of 2006, is that 5 correct? 6 A. Yes. 7 Q. You testified that you received a phone call from Franco 8 Milio, do you remember that? 9 A. Yes. 10 Q. It was during that phone call that Franco Milio told you 11 that he wanted you to take the lead in representing Milio 12 Management with respect to the Longfellow project, correct? 13 A. Yes. 14 Q. You knew before that phone call that Al DelBello was the 15 attorney representing Milio Management on Longfellow, correct? 16 A. Yes. 17 Q. You knew that Al DelBello had previously been the 18 lieutenant governor of New York State, right? 19 A. Yes. 20 Q. You knew that Al DelBello had also previously been the 21 mayor of the city of Yonkers, correct? 22 A. Yes. 23 Q. You knew that for a period of time Mr. DelBello also was 24 the county executive of the County of Westchester, correct? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1783 C35QANN2 Mangone - Cross 1 Q. Now, based upon your experience as an attorney during the 2 period that you were practicing law, there were occasions when 3 you would substitute for other attorneys or other attorneys 4 would substitute for you, correct? 5 A. Correct. 6 Q. By substitution, so the jury understands it, that means if 7 you are hired to take over a case, that is, where the client is 8 currently being represented by another attorney, you basically, 9 if it's a court matter, file a notice of appearance 10 substituting for the outgoing lawyer, correct? 11 A. Yes. 12 Q. Do you know that it's also customary when you come into a 13 matter to replace another lawyer that you contact the outgoing 14 attorney, advise him or her that you are now the lawyer 15 representing the client and make arrangements for the outgoing 16 lawyer to turn over to you the client file, correct? 17 A. Yes. 18 Q. You didn't do any of that with respect to Al DelBello, did 19 you? 20 A. No. 21 Q. You never got Mr. DelBello's file? 22 A. No. 23 Q. And the reason why the outgoing lawyer is asked to turn 24 over to the incoming lawyer the file is so that the incoming 25 lawyer can be brought up to speed with respect to everything SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1784 C35QANN2 Mangone - Cross 1 that has taken place in that matter up to the time of the 2 substitution, correct? 3 A. Yes. 4 Q. And that would include, for example, any notes or memoranda 5 that Mr. DelBello had concerning any conversations he had with 6 any member of the city council or with the client, Milio 7 Management, correct? 8 A. Yes. 9 Q. It would also include any correspondence Mr. DelBello had 10 with respect to the Longfellow resolution with any member of 11 the city council, the corporation council of the city of 12 Yonkers or any other governmental agency, correct? 13 A. Yes. 14 Q. As the incoming lawyer, it's important for you to have that 15 file so you don't have to duplicate work that's already been 16 done, but, more importantly, you can have a much better sense 17 of awareness of everything that's taken place up to the point 18 of your coming in, right? 19 A. Generally. 20 Q. In fact, from the time that you came into the case as the 21 lead attorney for Milio Management up to the time of the 22 resolution passing on September 26 of 2006, you never had a 23 single conversation with Mr. DelBello, did you? 24 A. No. 25 Q. Or, for that matter, anyone in Mr. DelBello's office, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1785 C35QANN2 Mangone - Cross 1 correct? 2 A. No, sir. 3 Q. No, sir, it's not correct, or, yes, sir, it is correct? 4 A. You're correct. 5 Q. I think I asked this a minute ago, but if I did, I 6 apologize. You never spoke to any city council member 7 concerning Longfellow either up until the resolution passed on 8 September 26 of '06? 9 A. I did have one conversation. 10 Q. With whom? 11 A. On the July 11 vote with John Murtagh. 12 Q. But the Longfellow resolution was not on the July 11 city 13 council calendar, was it? 14 A. No. That's precisely the reason I had the conversation. 15 Q. In terms of the substance of the resolution and what the 16 issues were, you never had any conversation with any city 17 council member concerning that, did you? 18 A. That's correct. 19 Q. Did you prepare any -- withdrawn. Did you speak to -- 20 strike that. Do you have any memos, notes, correspondence 21 concerning any of the legal services that you say that you 22 performed for Milio Management regarding the Longfellow project 23 between June of 2006 and September 26 of 2006? 24 A. Whatever has been turned over. 25 Q. You don't know what's been turned over, do you? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1786 C35QANN2 Mangone - Cross 1 A. Well, like we had subpoenas and we prepared files and sent 2 them over to the government. 3 Q. So there was no correspondence, no letters between you and 4 the corporation counsel's office or letters that you wrote to 5 any member of the city council concerning the Longfellow 6 resolution prior to September 26 of '06, correct? 7 A. I believe there were to corporation counsel, Joseph Madden. 8 Q. Letters or emails, sir? 9 A. Emails. 10 Q. Other than that, there's nothing, correct? 11 A. And anything between my client, obviously. 12 Q. Letters to your client? 13 A. Emails. 14 Q. Emails to your client. 15 Did you attend the May 3, 2006 town hall meeting at 16 the Trinity Russian Orthodox Church concerning the Longfellow 17 project? 18 A. No. 19 Q. Do you know that Al DelBello attended that meeting? 20 A. I do not. 21 (Continued on next page) 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1787 C35UANN3 Mangone - cross 1 Q. So you testified that the reason that you reached out to 2 Zehy Jereis was because you knew that Zehy Jereis was close to 3 Sandy and he had access to her? 4 A. Yes. 5 Q. But you knew someone else that was even closer to you than 6 Zehy Jereis who had access to Sandy, didn't you? 7 A. I don't understand the question. 8 Q. Debbie Kayal. You know Debbie Kayal, right? 9 A. Yes. 10 Q. She is your sister-in-law? 11 A. Yes, I do. 12 Q. She is your wife's sister? 13 A. Yes. 14 Q. They have a very good relationship, correct? 15 A. Yes. 16 Q. And you have a good relationship with Debbie, don't you? 17 A. Yes. 18 Q. You knew that Debbie was the legislative aide to Sandy 19 Annabi? 20 A. No. I knew her as the secretary. 21 Q. You were not aware that she had provided any legislative 22 services with respect to her employment with Sandy Annabi? 23 A. No, sir. 24 Q. You never asked your sister-in-law if she could set up a 25 meeting for you to meet with Sandy Annabi to discuss SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1788 C35UANN3 Mangone - cross 1 Longfellow, did you? 2 A. No, I did not. 3 Q. You yourself had previous occasions when you had contact 4 with Sandy, isn't that so? 5 A. Yes, sir. 6 Q. In fact you testified last week concerning the December 7 2005 Christmas party that you had at your office. Do you 8 remember that? 9 A. Yes. 10 Q. You invited Sandy Annabi to attend that party, correct? 11 A. Yes. 12 Q. And she attended? 13 A. Yes. 14 Q. In fact you testified last week that even prior to that you 15 knew members of her family, correct? 16 A. Yes. 17 Q. That you had provided legal services to members of her 18 family including her brother, correct? 19 A. Yes. 20 Q. You had also attended political functions where Sandy was 21 present? 22 A. Yes, sir. 23 Q. Fundraisers and the like? 24 A. Yes. 25 Q. So clearly as of June of 2006, you knew Sandy Annabi and SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1789 C35UANN3 Mangone - cross 1 she knew you? 2 A. Yes. 3 Q. In fact, didn't you describe to the government an instance 4 where you and your wife double-dated with Sandy and another 5 individual? 6 A. She came to my house for dinner. 7 Q. With a date? 8 A. Yes. 9 Q. That wasn't Zehy Jereis, was it? 10 A. No. 11 Q. And that was before June of '06, wasn't it? 12 A. Yes. 13 Q. So instead of just calling Sandy Annabi directly to see if 14 you could set up a meeting to discuss Longfellow, you reached 15 out to Zehy Jereis, that's your testimony, correct? 16 A. Yes, sir. 17 Q. During the period of time -- between the time that you had 18 your first meeting with the Milios, I think that was in April 19 of '06? 20 A. Yes. 21 Q. Until September of '06, weren't there periods of time when 22 Debbie Kayal and her husband lived with you and your wife after 23 they had sold their home? 24 A. I don't know if that was the exact time period, sir. 25 Q. How often would you say that you and your wife had contact SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1790 C35UANN3 Mangone - cross 1 with Debbie Kayal during the period of April of 2006 until 2 September of 2006? 3 A. I can't speak for my wife. I am sure it was rather 4 frequently. 5 Q. What about you, during that same period of time how often 6 did you see your sister-in-law -- once a week, once a month? 7 A. Once a month. 8 Q. Among the things you would discuss was her working at city 9 hall, right? 10 A. No. 11 Q. Never spoke to her at all about her work or about what she 12 was doing for Sandy? 13 A. No. 14 Q. Never during that period of time ever asked her a single 15 question about the work she was doing with Sandy? 16 A. No. 17 Q. In fact, during the period of time that you were employed 18 by Senator Spano, there were a number of occasions when you 19 contacted Sandy Annabi directly in connection with various 20 budget matters, union contracts, and other issues that Senator 21 Spano had an interest in, is that correct? 22 A. That's correct. 23 Q. And that was all before April of 2006, wasn't it? 24 A. Yes. 25 Q. Was she accessible to you? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1791 C35UANN3 Mangone - cross 1 A. At times. 2 Q. Was she more accessible to you than she was not accessible? 3 A. Yes. 4 Q. So you are saying that, what percentage of times would you 5 say that you tried to speak with her concerning the matters 6 that you were calling on Senator Spano's behalf did Sandy 7 Annabi refuse to talk to you? 8 A. It would generally have to be with whatever her position 9 was on certain issues. 10 Q. So if Sandy was opposed to a specific issue, she would 11 generally not be willing to engage in conversation concerning 12 that issue? 13 A. Yes. 14 Q. If she knew that you were approaching the issue from a 15 different side? 16 A. That's correct. 17 Q. But there were instances when you didn't know what her 18 position was and you would contact her and she would speak to 19 you, correct? 20 A. Yes. 21 Q. And on any of the occasions when you spoke to Sandy Annabi 22 concerning any issue that was before the city council, she 23 never asked you for any money in order to vote one way or the 24 other, did she? 25 A. Never. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1792 C35UANN3 Mangone - cross 1 Q. Now, when you pled guilty before the magistrate judge in 2 connection with this case, as you told Mr. Siano, when you were 3 asked certain questions by the magistrate judge, you were under 4 oath? 5 A. Yes. 6 Q. And do you recall telling the magistrate judge that what 7 you had done was that you acted together with Mr. Jereis to 8 obtain tens of thousands of dollars from your client, the 9 Longfellow developer? Do you recall that's what you told the 10 magistrate judge? 11 A. Yes, sir. 12 Q. By the way, getting back to what I asked you a short while 13 ago, you testified that there were no witnesses when you gave 14 Mr. Jereis any money -- when you say you gave him any money? 15 A. Correct. 16 Q. So with respect to the perjured testimony that you gave in 17 the Wedra case, other than the accoutrements in this courtroom 18 the logistics were pretty much the same -- there was a judge, 19 you were sitting in the witness stand, there was a prosecutor 20 or a defense lawyer asking you questions and there were 12 21 jurors sitting in the box, just like we have here today, 22 correct? 23 A. Correct. 24 Q. And when you were asked a question whether Senator Spano 25 had any knowledge of the scheme, you looked those jurors in the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1793 C35UANN3 Mangone - cross 1 eye and you lied when you said he did not, right? 2 A. That's correct. 3 Q. In addition to that, you have also told us that, among the 4 things that you have done with respect to criminal activity, 5 you accepted cash fees from clients that you failed to report 6 on your income tax returns, right? 7 A. Yes. 8 Q. As a result of your failure to report those cash fees, you 9 also understated the amount of income taxes you owed the 10 government, correct? 11 A. Yes. 12 Q. Now, you know from your experience that when you file a tax 13 return, you do so under oath, correct? 14 A. Yes. 15 Q. You swear that all of the information on the tax return is 16 true, correct? 17 A. Yes. 18 Q. And when you filed your tax returns in which you omitted 19 these cash fees and swore to the truthfulness of those returns, 20 you lied again, correct? 21 A. Yes. 22 Q. And you didn't do that on just one occasion, did you? 23 A. No. 24 Q. On how many occasions did you file false income tax returns 25 where you understated or omitted the receipt of income? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1794 C35UANN3 Mangone - cross 1 A. I believe it was five years. 2 Q. Well, are we talking about the five years that you pled 3 guilty? 4 A. The five years that I was -- that I understated my income. 5 Q. Well, you appeared before United States District Judge 6 Karas in the federal court in White Plains? 7 A. Yes. 8 Q. In addition to the plea that you took before Magistrate 9 Judge Yanthis in connection with this case, you also pled 10 guilty before Judge Karas with respect to tax charges, correct? 11 A. Yes. 12 Q. Those tax charges involved false tax returns over a 13 five-year period, correct? 14 A. Yes. 15 Q. So you are not suggesting to this jury that you had not 16 filed false tax returns before those five years, are you? 17 A. Yes. 18 Q. So you are saying, up until 2002, you had always filed 19 completely honest and accurate income tax returns? 20 A. To the best of my knowledge, yes. 21 Q. So with respect to 2002 through 2007, you understated the 22 taxes that were due and owing the Internal Revenue Service by 23 $3,113 for the year 2003, $3,721 for the year 2004, $3,720 for 24 the year 2005, $77,489 for the year 2006 and $28,510 for the 25 year 2007, right? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1795 C35UANN3 Mangone - cross 1 A. Yes. 2 Q. By the way, you filed tax returns ever since you began 3 working, correct? 4 A. Yes. 5 Q. So you know that the amount of tax, the understated tax 6 does not reflect the amount of unreported income that led to 7 that tax fee, correct? 8 A. Yes. 9 Q. So let's say for the year 2006, you understated the taxes 10 due and owing by $77,489, so how much unreported income was 11 there for the year 2006 to lead to a $77,000 understated tax 12 due and owing figure? 13 A. Around 200,000, I believe. 14 Q. I'm sorry. What? 15 A. It was around 200,000, I believe. 16 Q. You believe it was about 200,000; you don't know? 17 A. I don't have my notes in front of me from when my lawyer 18 called me. 19 Q. About $200,000 in unreported cash fees, correct? 20 A. Yes. 21 Q. And for 2007, how much unreported income was there that led 22 to an understated tax of $28,510? 23 A. I don't recall exactly the amount. It must have been 24 somewhere around 80,000. 25 Q. In fact, in 2006 and 2007, you deposited legal fees that SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1796 C35UANN3 Mangone - cross 1 you would receive from clients in the amounts of approximately 2 $100,000 directly into your personal bank account rather than 3 the business bank account, correct? 4 A. Yes. 5 Q. And you did not report the receipt of that income on your 6 tax returns for 2006 or 2007, correct? 7 A. No. 8 Q. By the way, in 2006, was the firm of Santangelo Randazzo 9 and Mangone in existence? 10 A. Yes. 11 Q. The firm had not dissolved in 2006? 12 A. No. We were still in existence. 13 Q. Are you sure of that? 14 A. Not certain, but I think we were. 15 Q. Isn't it true that when you referred the Milios Franco 16 Milio to Michael Santangelo, that was in '07? 17 A. That's correct. 18 Q. At that time the firm was dissolved, correct? 19 A. I don't believe that the firm was dissolved. It was still 20 in operation for the Putnam account purposes. 21 Q. For the Putnam account purposes, but for all other purposes 22 the firm had, for all intents and purposes, been dissolved, 23 correct? 24 A. That's correct. There was no agreement. 25 Q. Michael Santangelo was no longer a partner of yours as of SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1797 C35UANN3 Mangone - cross 1 '07, even with respect to the Putnam County matter, isn't that 2 so? 3 A. As of November '07, we stopped being partners. 4 Q. Well, isn't the reason that you referred Mr. Milio to 5 Mr. Santangelo was because you thought that there would be a 6 conflict of interest if you were representing Mr. Milio in 7 connection with the grand jury subpoena that had been served? 8 A. I just thought it would be better that he represent him. 9 Q. Well, the fact of the matter is, when you say you thought 10 it would be better, you thought it would be better if Michael 11 Santangelo represented Mr. Milio with respect to the grand jury 12 subpoena than you for what reason? 13 A. Certainly if I was involved in it, I couldn't be 14 representing him. 15 Q. And that's what conflict of interest means, right? 16 A. Yes. 17 Q. But isn't it also true that it was not only you that had 18 been retained to represent the Milios but, indeed, the firm of 19 Santangelo -- 20 MR. ARONWALD: Could I just have one moment, your 21 Honor? 22 THE COURT: Yes. 23 Q. Isn't it true that the firm Santangelo Randazzo and Mangone 24 had been hired to represent the Milio Management Company? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1798 C35UANN3 Mangone - cross 1 Q. Isn't it also true that because the firm represented Milio 2 Management Company and not Anthony Mangone individually, that 3 even Michael Santangelo would have the same conflict of 4 interest issue that you did? 5 A. I don't think that we thought it out that far. 6 Q. When you said you didn't think it out that far, you never 7 had any discussions with Michael Santangelo as to what the 8 grand jury investigation was about before your referred 9 Mr. Milio to him, did you? 10 A. No. 11 Q. When you say we hadn't really thought it out, you meant 12 that you, Anthony Mangone, had not thought it out, correct? 13 A. No. I am saying, when he said he couldn't represent Franco 14 anymore, he didn't say that the reason was that we represented 15 him in the Longfellow case. 16 Q. The reason that he didn't want to represent Mr. Milio was 17 because of the money that you say you gave to Mr. Jereis, 18 correct? 19 MR. CARBONE: Objection as to what Mr. Santangelo 20 thought or said. 21 THE COURT: Overruled. 22 Q. Let me rephrase that. 23 The reason that Mr. Santangelo wasn't going to 24 represent Mr. Milio was because of the money that you say Milio 25 gave to you -- isn't that the reason, Mr. Santangelo would not SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1799 C35UANN3 Mangone - cross 1 represent Milio? 2 A. Yes. 3 Q. In fact you had a conversation with Mr. Milio, you asked 4 him, why did you tell Michael Santangelo about the money? Do 5 you remember that? 6 A. Yes. 7 Q. Mr. Milio said, I thought I was supposed to tell my lawyer 8 everything, correct? 9 A. Yes. 10 Q. And then you said you would have to give him another 11 lawyer. You would have to get him another lawyer, correct? 12 A. Yes. 13 Q. You told them that you are required to give him a list of 14 four names, is that correct? 15 A. Yes. 16 Q. And included on that list was the name of Lawrence 17 Diagiansante, correct? 18 A. Yes. 19 Q. You told Mr. Franco Milio that you recommended that he see 20 Mr. Diagiansante and hire him, correct? 21 A. Yes. 22 Q. Before you and Mr. Milio left each other's company that 23 day, you told Mr. Milio that absolutely under no circumstances 24 should he mention the money that he gave to you, correct? 25 A. Correct. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1800 C35UANN3 Mangone - cross 1 Q. From your experience as a lawyer, you understand and 2 appreciate the importance of an attorney knowing everything 3 that his client has to tell him so that he can provide 4 effective representation to protect the client's rights; you 5 know that, right? 6 A. Yes, sir. 7 Q. And knew that then, right? 8 A. Yes. 9 Q. You knew that by telling Mr. Milio not to tell Mr. 10 Diagiansante about the money, that would only operate to 11 protect you, correct? 12 A. Yes. 13 Q. Even though you knew that by Mr. Milio withholding 14 important information from his lawyer, that might affect Mr. 15 Diagiansante's ability to provide effective, meaningful 16 representation to his client, Milio Management, correct? 17 A. Yes. 18 Q. And you didn't feel guilty about that, did you? 19 A. I was in a bad place. 20 Q. You didn't feel guilty about that, did you? 21 A. No, I did. 22 Q. But you did it anyway? 23 A. Yes. 24 Q. You were in a bad place because you felt like you were 25 between a rock and hard place because you felt the door SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1801 C35UANN3 Mangone - cross 1 closing, right? 2 A. Yes. 3 Q. You thought that you were about to be arrested and 4 prosecuted, correct? 5 A. Yes. 6 Q. And you knew that if you were arrested and prosecuted and 7 convicted, you would lose your law license and you might 8 conceivably go to prison for a long period of time, correct? 9 A. Yes. 10 Q. So to protect your interest, you basically told your client 11 to withhold information from his new lawyer even though that 12 would prevent his new lawyer from representing him to the best 13 of that lawyer's ability, correct? 14 A. Correct. 15 Q. By the way, you have talked about an attorney trust 16 account. What is an attorney trust account? 17 A. It is an account where funds from clients, their money is 18 deposited into and held there in escrow. 19 Q. When you say "held in escrow," just so we are clear, you 20 are required under law to hold the client's funds in escrow 21 until whenever escrow conditions there are have been satisfied 22 so that the money can be released to the client, correct? 23 A. Yes. 24 Q. And you also were aware throughout your practice of law 25 that the funds in an attorney trust account do not under any SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1802 C35UANN3 Mangone - cross 1 circumstances whatsoever belong to the attorney, correct? 2 A. Yes. 3 Q. And you also knew that under no circumstances whatsoever is 4 the attorney permitted to use the clients' funds in the 5 attorney trust account for the attorney's own personal use, 6 correct? 7 A. Correct. 8 Q. But you did so anyway, didn't you? 9 A. No. 10 Q. Didn't you testify that you wrote checks from your attorney 11 trust accounts to the casinos to establish credit so that you 12 could get your markers? Isn't that what you told Mr. Siano on 13 Thursday? 14 A. No. I told him that there were times when I deposited 15 attorney escrow checks into my personal account that covered 16 casino markers. 17 Q. So you took your checks from your attorney escrow accounts 18 and deposited those to yourself, correct? 19 A. That's correct. 20 Q. And deposited those checks into your account? 21 A. That's correct. 22 Q. But those checks that you wrote from the attorney escrow 23 account, none of the funds in that attorney escrow account 24 belonged to you, did they? 25 A. Yes, they were. They were legal fees. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1803 C35UANN3 Mangone - cross 1 Q. Legal fees that were left in the attorney escrow account? 2 A. Whether it had been for a settlement, for a real estate 3 closing, those were funds that were left over at the end and 4 they should have been deposited into my operating account but 5 instead I deposited them into my personal account. 6 Q. You took these funds, deposited them into your personal 7 account, and whatever the figure of those checks were, that was 8 also moneys you did not report on your income tax return? 9 A. Correct. 10 Q. By the way, you did not prepare your own tax returns, 11 correct? 12 A. No. 13 Q. You had an accountant prepare them? 14 A. Yes. 15 Q. Certified public accountant? 16 A. I don't recall. 17 Q. But in any event, a tax return prepared -- an accountant? 18 A. Yes. 19 Q. Someone with an accounting degree, correct? 20 A. Yes. 21 Q. When you met with the accountant and gave him the 22 information that he would need to prepare your tax return, you 23 did not tell him about the cash fees that you had received, 24 correct? 25 A. No. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1804 C35UANN3 Mangone - cross 1 Q. And during the interview or the meeting you had with your 2 accountant, do you recall that he asked you to tell him all of 3 the income that you had received for that year, correct? 4 A. Yes. 5 Q. You lied to him when you didn't tell him about the cash 6 fees that you had received, correct? 7 A. Yes. 8 Q. And the reason you didn't tell him about it was because you 9 knew that if you told him about it, the income tax return that 10 he would prepare for you would list that income and that would 11 mean that you would have to pay more taxes than you wanted to 12 pay, correct? 13 A. Yes. 14 Q. So the reason that you didn't report that income was to 15 conceal from the Internal Revenue Service the amount of income 16 and the corresponding amount of income taxes that you actually 17 owed, correct? 18 A. Yes. 19 Q. You didn't feel guilty about that, did you? 20 A. No. 21 Q. Because filing those false tax returns and not reporting 22 that income was for your benefit? 23 A. Yes. 24 Q. Well, you also overbilled clients, didn't you? 25 A. Me? No. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1805 C35UANN3 Mangone - cross 1 Q. No? 2 Your law firm had a contract with Putnam County, 3 correct? 4 A. Yes. 5 Q. And under the terms of the contract, your firm was -- by 6 the way, the firm, you were a -- each partner shared equally? 7 A. Yes. 8 Q. So if there were four partners, 25 percent of the net 9 profit would go to each partner? 10 A. Correct. 11 Q. So the firm was hired by Putnam County to provide legal 12 services, correct? 13 A. Yes. 14 Q. But Putnam County provided a cap, in other words, the legal 15 services for which the firm would be paying would not exceed 16 $450,000 in any year, correct? 17 A. I believe that was the number. 18 Q. That didn't mean that the firm would get $450,000; it meant 19 that it would get up to $450,000 based upon the billable hours 20 that the firm submitted to the County of Putnam, correct? 21 A. Correct. 22 Q. So in order to earn that $450,000, the firm had to put in 23 $450,000 worth of actual billable hours, correct? 24 A. Yes. 25 Q. By billable hours I mean, when you provide a service on SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1806 C35UANN3 Mangone - cross 1 behalf of a client, you keep track of your time and at the end 2 of the month or whatever the billing cycle is, you bill the 3 client based upon the amount of time that is reflected in your 4 time records, correct? 5 A. Correct. 6 Q. You multiply that time by whatever your hourly billing rate 7 is, and that is what the amount that is due and owing to the 8 firm for that billing cycle is, correct? 9 A. Yes. 10 Q. But in order to get to that $450,000 figure, the firm of 11 which you were a member, submitted false invoices to Putnam 12 County in which the firm exaggerated the billable hours in 13 order to be able to reach that $450,000 figure, isn't that 14 true? 15 A. The firm at times did that. 16 Q. When you say the firm at times did that, you were a part of 17 the firm, right? 18 A. Yes. 19 Q. So instead of the firm, it is we sometimes did that; that 20 would be more accurate, wouldn't it? 21 A. That would be correct. 22 Q. By how much did the firm, including you, overbill Putnam 23 County? 24 A. I don't know, sir. I wasn't involved in that. 25 Q. But you knew about it, didn't you? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1807 C35UANN3 Mangone - cross 1 A. I didn't sit there with a calculator and ask them how much 2 they exaggerated it. 3 Q. You knew that the bills that were being submitted by the 4 firm of which you were a member were false, correct? 5 A. Yes. 6 Q. You knew that the County of Putnam was being misled and 7 deceived in terms of how much money you had actually earned -- 8 the firm of which you were a member had actually earned in that 9 billing cycle, correct? 10 A. Yes. 11 Q. You did nothing to stop it, did you? 12 A. No. 13 Q. And you knew that by doing that, the firm of which you were 14 a member was effectively stealing money from Putnam County, 15 correct? 16 A. Yes. 17 Q. By Putnam County we are talking about the taxpayers of 18 Putnam County, correct? 19 A. Yes. 20 Q. As part of your plea agreement, you are not required to 21 make restitution to Putnam County for the amount of money that 22 you stole, isn't that correct? 23 A. The amount of restitution is going to be determined by the 24 Court. 25 Q. Does your plea agreement include restitution to Putnam SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1808 C35UANN3 Mangone - cross 1 County? 2 A. No, it does not. 3 MR. ARONWALD: May I just have a moment, your Honor? 4 THE COURT: Yes. 5 (Pause) 6 Q. As you sit here now, Mr. Mangone, do you have any idea as 7 to the amount that your firm, of which you were a member, 8 overbilled Putnam County? 9 A. No. 10 MR. ARONWALD: May I just have a moment to consult 11 with Mr. Siano, your Honor? 12 THE COURT: Please. 13 (Pause) 14 Q. Now, you committed other instances of tax fraud other than 15 with respect to your own personal tax returns, didn't you? 16 A. I don't understand the question. 17 Q. Well, let's talk about the firm's hiring of Matt Libous. 18 He was the son of New York State Senator Tom Libous? 19 A. Yes. 20 Q. You described Senator Libous to the government as Senator 21 Nick Spano's "go-to-guy"? 22 A. Yes. 23 Q. You never even interviewed Matt Libous before you hired 24 him, did you? 25 A. Yes, I did. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1809 C35UANN3 Mangone - cross 1 Q. You did. 2 You were impressed enough to hire him as an associate 3 of the firm? 4 A. Yes. 5 Q. Would you have hired him even if you hadn't gotten the call 6 from Senator Libous asking you to hire him? 7 A. I don't know. 8 Q. Would you have agreed to pay him $150,000 a year as an 9 incoming first-year associate if Senator Libous hadn't asked 10 you to do it? 11 A. He wasn't a first-year associate. 12 Q. Well, what was he? 13 A. At least a fourth or fifth year. 14 Q. Would you have hired him as a fourth- or fifth-year 15 associate at $150,000 a year if you hadn't been asked by the 16 senator to do that? 17 A. No. 18 Q. By the way, the compensation package for young Matt Libous 19 was not just limited to his salary, was it? 20 A. No. 21 Q. It also included a car? 22 A. Yes. 23 Q. So Senator Libous calls you and asks you to hire his son 24 Matt, correct? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1810 C35UANN3 Mangone - cross 1 Q. And Senator Libous is the one that tells you how much to 2 pay Matt, correct? 3 A. He had asked what we could afford to pay him. 4 Q. Wasn't it Senator Libous who said that he wanted you to pay 5 him $150,000 a year? 6 MR. CARBONE: Objection. 7 THE COURT: Overruled. 8 Q. Isn't that true? 9 A. Initially, yes. 10 Q. And then within a few days, Senator Libous said that he 11 wanted you to pay him 100,000? 12 A. Yes. 13 Q. There was also talk about leasing him a car? 14 A. Yes. 15 Q. And you agreed to it, correct? 16 A. Yes. 17 Q. And then Senator Libous called to tell you that his son had 18 leased a Range Rover? 19 A. No. 20 Q. What did he tell you he leased? 21 A. His son told me that. His father never -- 22 Q. His son told you he leased a Range Rover, correct? 23 A. That's correct. 24 Q. And you were somewhat taken aback because the firm had sort 25 of contemplated leasing him a Honda which would have been SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1811 C35UANN3 Mangone - cross 1 considerably cheaper? 2 A. Correct. 3 Q. Then Senator Libous called and said he really needs 150,000 4 a year. Do you remember that? 5 A. Yes. 6 Q. You called and said, we can't afford to pay 150,000, 7 correct? 8 A. Correct. 9 Q. And that's when it was decided, that in order to make up 10 the additional $50,000, you and Senator Libous agreed that you, 11 the firm, would bill HIFFA, a consulting company in Putnam 12 County? 13 A. Correct. 14 Q. And you would bill them for $50,000 in legal services? 15 A. Yes. 16 Q. Now, the fact of the matter is, HIFFA was not a client of 17 the firm? 18 A. Yes, it was. 19 Q. You provided legal services for HIFFA? 20 A. Matt Libous was in charge of that account. 21 Q. Mat Libous was in charge of that account? 22 A. Yes. 23 Q. So you are saying that during the period of time he worked 24 for you, he provided legal services on behalf of the firm to 25 HIFFA? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1812 C35UANN3 Mangone - cross 1 A. I didn't ask him for any reports, but that's what his 2 responsibilities were. 3 Q. You never saw a single piece of paper that indicated that 4 he had provided any legal services to HIFFA, did you? 5 A. I didn't ask him for anything. 6 Q. Because you didn't care? Isn't that also true? 7 A. Not necessarily, no. 8 Q. You billed HIFFA for legal services in the amount of 9 $50,000 without knowing whether or not Matt Libous had in fact 10 put in $50,000 worth of billable time? Isn't that so? 11 A. It wasn't 50,000. It was prorated over 50,000, but at the 12 end of the year, it was only for eight months or six months. 13 Q. Originally when you spoke to the senator it was 14 contemplated at that time that HIFFA would pay $50,000 during 15 the course of the year -- 16 A. Yes. 17 Q. -- that would be used to pay Matt's 150,000-dollar-a-year 18 salary? 19 A. Yes. 20 Q. At the time that you hired him, it was not contemplated 21 that the relationship was not going to work out very well 22 because you became dissatisfied with his services, correct? 23 A. Yes. 24 Q. So you had sent these bills to HIFFA for legal services and 25 in an amount that over the course of the year would come out to SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1813 C35UANN3 Mangone - cross 1 be $50,000, right? 2 A. Yes. 3 Q. Without knowing whether or not the firm had actually -- 4 either the firm and Matt together -- put in billable hours in 5 the amount HIFFA was being billed, isn't that so? 6 A. Correct. 7 Q. You used that money to pay Matt's salary? 8 A. To help subsidize the cost, yes. 9 Q. So at the end of the year, the firm reported the receipt of 10 the money from HIFFA as income? 11 A. Yes. 12 Q. Took off a corresponding expense for Matt's salary, 13 correct? 14 A. Yes. 15 Q. And HIFFA was essentially taking a deduction for legal fees 16 that it paid to your firm? 17 A. I don't know. 18 Q. But you understood that that, in all likelihood, was 19 exactly what was going to happen, right? 20 A. Yes. 21 Q. You knew at the time that the reason that the senator 22 wanted you to bill HIFFA was because the senator told you that 23 it would not "look good" if there were any checks from HIFFA 24 directly to the senator, isn't that what you understood? 25 But you told your accountant to treat the checks that SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1814 C35UANN3 Mangone - cross 1 were coming into the firm from HIFFA as referral fees? 2 A. No. 3 Q. No? 4 Showing you what has been marked as 3517O, page 4. 5 MR. ARONWALD: May I approach, your Honor? 6 Q. 3517O, page 4, and I am directing your attention to the 7 first sentence in the last paragraph. 8 A. Yes. 9 Q. Does that refresh your recollection that that's what you 10 told your accountant? 11 A. Yes. 12 Q. And Mr. Mangone, now, during the period of time that you 13 were engaged in the practice of law, are you familiar with the 14 term "made member"? 15 A. I don't understand the question. 16 Q. In the context of organized crime, are you familiar with 17 the term "made member"? 18 A. Yes. 19 Q. Are you also familiar with the term "associate"? 20 A. Yes. 21 MR. CARBONE: Objection. Relevance. 22 THE COURT: Ladies and gentlemen, we are going to take 23 our lunch break now. I will see you at 2 o'clock. 24 Don't discuss the case, keep an open mind. 25 (Continued on next page) SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1815 C35UANN3 Mangone - cross 1 (Jury not present) 2 THE COURT: See you after lunch, Mr. Mangone. 3 (Witness excused) 4 THE COURT: Where are we going, Mr. Aronwald? 5 MR. ARONWALD: We are going to the fact that 6 Mr. Mangone told the government that he was friendly with made 7 members and associates of organized crime, and I think that's 8 something that goes to his credibility. He named the made 9 members that he was associated with. So I think that that is 10 something that the jury has a right to hear because it is a 11 factor which may affect their assessment of his credibility. I 12 don't intend to spend a whole lot of time on it, your Honor, 13 but I think I am entitled to inquire on it. It certainly seems 14 to me it is impeachment material for the jury to know that you 15 have an individual who was associating with people that he 16 understands to be made organized crime members. 17 THE COURT: Just remember something, Mr. Aronwald, 18 that I have no idea what your thought processes are and I 19 haven't read the 3500 material, so I don't have a clue where 20 you are going -- not a clue. 21 MR. ARONWALD: Judge, I find no fault with your 22 discussing this. What I am saying to your Honor is that it is 23 something that is clearly in the 3500 material. I think it is 24 something that we have a right to pursue. I don't intend to 25 spend a whole lot of time on it. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1816 C35UANN3 Mangone - cross 1 THE COURT: Mr. Carbone. 2 MR. CARBONE: Judge, I think the fact that Mr. Mangone 3 may have known and grown up with and even represented reputed 4 members of organized crime has no relevance at all to his 5 credibility. 6 First of all, with respect to family associations and 7 affiliations -- and it is reflected in the 302s -- he did grow 8 up with the daughter of a reputed or an alleged member of 9 organized crime. He later came to represent that individual in 10 an attorney-client capacity. 11 I think not only is it unrelated to his ability to 12 tell the truth, but it is character assassination. It is guilt 13 by association. If every lawyer could be cross-examined about 14 who their clients are -- I just think that is unfair and it 15 doesn't at all go to truth. 16 If the only thing Mr. Aronwald wants to do is get 17 before the jury that Mr. Mangone knew members of organized 18 crime, how does that go to credibility? It doesn't. And the 19 prejudicial value far outweighs any marginal, if any, probative 20 value and it should be precluded. 21 MR. ARONWALD: The 3500 material I am referring to is 22 3517I, page 3, second paragraph and I am quoting: "Mangone is 23 friendly with some made members and associates." That is not 24 in a representative capacity. That is not something that we 25 put into the 302. This is what is reflected as something that SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1817 C35UANN3 Mangone - cross 1 Mangone told the government when he met with them on April 14 2 of 2010. This is not about whether he represented organized 3 crime people. That is something that he has every right to do, 4 but what I am saying is, he is not saying I represented him. 5 He is saying, I am friendly with made members and associates of 6 organized crime. There is a big difference. 7 In terms of 403, this is the only witness that this 8 jury will hear any testimony from concerning any money that is 9 alleged to have been paid to either defendant in this case. So 10 for the government to talk about 403, it seems to me the 11 probative value to the rights of these defendants to a fair 12 trial exceeds in prejudicial effect that may result from 13 bringing out Mr. Mangone's friendships with organized crime 14 members. 15 THE COURT: Mr. Siano is raising his hand. 16 MR. SIANO: Judge, I don't want to try to get a dog 17 into this fight. 18 THE COURT: Sure you do, Mr. Siano, otherwise you 19 wouldn't have raised your hand. 20 MR. SIANO: Judge, the thing that troubles me is, if 21 the government of the United States of America submits 22 affidavits signed by special agents of the FBI in one courtroom 23 in this building describing these individuals as actual members 24 of organized crime families, it is really not appropriate for a 25 prosecutor before your Honor to say words like "reputed." The SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1818 C35UANN3 Mangone - cross 1 weasel words that are used -- 2 THE COURT: Forget about the weasel words. The only 3 issue here is whether it goes to your credibility, if you know 4 a mobster. And I say no, it doesn't necessarily go to your 5 credibility. 6 So in the absence of a considerably more fulsome 7 proffer about how this would have an impact on the 8 believability of the witness, I think Mr. Carbone is exactly 9 correct. It doesn't go to credibility and you have your 10 exception. 11 MR. ARONWALD: Your Honor, you are the gatekeeper and 12 you make those determinations, but it seems to me that if you 13 have someone on the stand who the government is holding out to 14 be a credible witness, the jury has a right to know what that 15 person's background is. The jury has a right to know whether 16 that person is friendly with reputed -- not reputed -- actual 17 organized crime members and associates. 18 It seems to me that, in the interest of making sure 19 that the defendants get a fair trial -- and I am not suggesting 20 for a moment that your Honor is doing anything to deprive them 21 of that. 22 THE COURT: Indeed I am not. I am bending over 23 backward in their favor, but you know that it has to be that 24 there is a logical nexus between knowing a bad person and being 25 a liar. And I have to tell you, I don't see the logical nexus, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1819 C35UANN3 Mangone - cross 1 the necessary logical nexus between knowing a bad person, even 2 being friendly with a bad person. Who knows? It may be a 3 friendship that goes back to kindergarten, before the bad 4 person was a bad person. I don't know, but in the absence of 5 considerably more information about why that necessarily makes 6 him a liar, I don't see that it has any probative value at all. 7 (Luncheon recess) 8 9 (Continued on next page) 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1820 C35Qann4 Mangone - Cross 1 AFTERNOON SESSION 2 2:00 P.M. 3 (In open court; jury present) 4 ANTHONY MANGONE, resumed. 5 CROSS-EXAMINATION CONTINUED 6 BY MR. ARONWALD: 7 THE COURT: OK. Have a seat. You are still under 8 oath. 9 Mr. Aronwald. 10 Q. Mr. Mangone, the tax returns that you filed, were those 11 joint returns? 12 A. Yes. 13 Q. So these returns were filed jointly by you and your wife 14 Donna Mangone, correct? 15 A. Yes. 16 Q. Both of you signed those returns? 17 A. Yes. 18 Q. You did not disclose to her that the returns that you were 19 filing were false and fraudulent returns, correct? 20 A. No. 21 Q. But you indicated that you did not tell her that your 22 losses exceeded more than your winnings at the various casinos, 23 correct? 24 A. Correct. 25 Q. This was something that she wanted to know, correct? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1821 C35Qann4 Mangone - Cross 1 A. I don't know. 2 Q. Well, did you tell her that your winnings exceeded more 3 than your losses? 4 A. No. 5 Q. You just didn't tell her there were any losses? 6 A. No. 7 Q. Now, you were also involved in a real estate deal with your 8 good friend Pat Stiso, correct? 9 A. Yes. 10 Q. In that real estate deal, the paperwork was falsified to 11 conceal Stiso's involvement due to his previous felony 12 conviction, correct? 13 A. I don't understand the question. 14 Q. Were you involved in more than one real estate deal with 15 Pat Stiso after his felony conviction? 16 A. Just one. 17 Q. Just one. Were you and Michael Santangelo and Pat Stiso 18 involved in a real estate deal Penny Field Estates? 19 A. Yes. 20 Q. And Stiso was very much involved in that deal, wasn't he? 21 A. Yes. 22 Q. And in what capacity was he involved? 23 A. Preparing information on the sales and so forth, water 24 bills, things of that nature. 25 Q. Didn't he share in the money from Penny Fields? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1822 C35Qann4 Mangone - Cross 1 A. Yes. 2 Q. Isn't it true that you told the FBI that Stiso could not be 3 identified as being involved in the deal on paper quote unquote 4 because of his former felony conviction record? 5 A. Yes, we didn't want him as a member of the company. 6 Q. But he was in fact a member although an undisclosed member 7 of the company, correct? 8 A. He shared in the profits. 9 Q. Shared in the profits because he was a member of the deal 10 even though he was not disclosed as such on paper, correct? 11 A. He was not a member of the company. 12 Q. OK. But he was sharing in the profits? 13 A. We gave him a piece of the percentage of the profits, yes. 14 Q. And the only reason that his name was not anywhere on the 15 papers was because of his prior felony conviction, correct? 16 A. Yes. 17 Q. One of your partners was Anthony Servino, correct? 18 A. Yes. 19 Q. There came a time when Mr. Servino decided he was going to 20 leave the firm, correct? 21 A. Yes. 22 Q. And he was going to go to the Westchester County DA's 23 office, correct? 24 A. Yes. 25 Q. You and Michael Santangelo were partners together with SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1823 C35Qann4 Mangone - Cross 1 Mr. Servino, correct? 2 A. Yes. 3 Q. And it's true, is it not, that when you knew that 4 Mr. Servino was getting ready to leave the firm -- by the way, 5 under the terms of this partnership arrangement, the 6 partnership agreement you were equal one-third, one-third, 7 one-third partners? 8 A. Yes. 9 Q. So any fees that came in had to be divided equally amongst 10 the three of you? 11 A. And the expenses, yes. 12 Q. There came a time when Mr. Servino had indicated that he 13 was leaving, and you and Mr. Santangelo agreed amongst 14 yourselves that you were not going to tell Mr. Servino about 15 fees that were coming in in order that you not have to share 16 with him his share of those fees, correct? 17 A. Yes. 18 Q. What you and Mr. Santangelo did was you decided in order to 19 keep the information from Mr. Servino about these incoming fees 20 that you would not -- you would hold on to those fees and not 21 deposit them into the firm account? 22 A. That's correct. 23 Q. At the end of the day, when Mr. Servino left, you and 24 Mr. Santangelo then deposited those fees into the firm account 25 and shared equally in them? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1824 C35Qann4 Mangone - Cross 1 A. Yes. 2 Q. But, in effect, what you did was you defrauded Mr. Servino 3 out of his one-third share of those fees, didn't you? 4 A. No, that's not accurate. 5 Q. Well, you didn't share any of those fees with him, did you? 6 A. No, he didn't share any of the expenses either. 7 Q. Did the fees exceed the expenses? 8 A. They were prospective fees for cases, and they did -- they 9 did in fact exceed the expenses that were when Mr. Servino was 10 in the DA's office, and the cases were before the DA. 11 Q. Didn't you tell the FBI that the reason that you and 12 Mr. Santangelo didn't deposit the monies was with the specific 13 intent that you would not have to give Mr. Servino his share? 14 Isn't that what you told the FBI? 15 A. Yes, it is. 16 Q. OK. And the fact of the matter is you did not tell 17 Mr. Servino about those fees, did you? 18 A. That's correct. 19 Q. And he did not get any portion of those fees, did he? 20 A. No. 21 Q. And he was your partner? 22 A. Yes. 23 Q. For how long had he been your partner? 24 A. Approximately four years. 25 Q. Mr. Siano asked you about money laundering before. Do you SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1825 C35Qann4 Mangone - Cross 1 know an individual by the name of Luis Medina? 2 A. Yes. 3 Q. Who is Mr. Medina? 4 A. He's an attorney. 5 Q. There came a time when the firm through Mr. Santangelo 6 wrote a $25,000 check to Medina in exchange for $20,000 in 7 cash, correct? 8 A. Yes. 9 Q. The $20,000 cash was divided equally between you, 10 Mr. Servino, Mr. Santangelo, and Mr. Randazzo, correct? 11 A. Yes. 12 Q. Then there was another individual who would wire money into 13 the account of Milio Management and the Milios would then 14 provide cash to that person who then wired the money back into 15 their account so that they could clean up the undisclosed cash, 16 correct? 17 A. Yes. 18 Q. The money that was wired back, was that money that was 19 wired into your firm account? 20 A. I believe so. 21 Q. And you participated in that, isn't that so? 22 A. I wrote checks from it, yes. 23 Q. Now, with respect to the transaction Mr. Siano spoke to you 24 about involving Mr. Ricciardi, let's just see if we can put 25 this into understandable fashion. You were handling a real SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1826 C35Qann4 Mangone - Cross 1 estate deal for the Milios. 2 A. Yes. 3 Q. They were purchasing the property from another individual? 4 A. Another company, yes. 5 Q. The Milios wanted to close the deal in cash, but the seller 6 didn't want to do that, correct? 7 A. Not all cash. They were short on money, so they wanted to 8 use some cash. 9 Q. The name of the seller was Schwartz, correct? 10 A. Yes, it was. He was the principal of the company. 11 Q. And Mr. Schwartz would not accept cash at the closing, 12 isn't that so? 13 A. I didn't even bring it to his attention because I knew he 14 wouldn't accept it. 15 Q. But you told the FBI that Schwartz would not accept cash at 16 the clothing, correct? 17 A. I just -- yeah. 18 Q. So what happened was the Milios gave the cash to 19 Mr. Ricciardi, and Mr. Ricciardi then wired that money into 20 your attorney escrow account, correct? 21 A. I don't know if they definitely gave it to him, but I'm 22 assuming they did because the money was wired into my account. 23 Q. After the Milios gave the cash to Ricciardi, the money was 24 wired into your account, you then drew checks from your escrow 25 account to obtain bank checks to be used for the closing, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1827 C35Qann4 Mangone - Cross 1 correct? 2 A. Yes. 3 Q. And that was all done to assist the Milios in concealing 4 their cash -- receipt of cash, correct? 5 A. Yes. 6 Q. Now, you testified on Thursday about a meeting in late 7 April of 2006, and that was a meeting that Mr. Jereis was at? 8 A. Yes. 9 Q. The reason that you had Mr. Jereis there was to have 10 someone that you -- you wanted him there so you could show the 11 client that you were bringing someone who could perhaps 12 influence Sandy and her vote, correct? 13 A. Yes. 14 Q. And someone who would be able to give you all insight into 15 her views on the project? 16 A. Correct. 17 Q. And we're talking about the Longfellow project, correct? 18 A. Yes. 19 Q. And it's true, is it not, that at the end of the meeting, 20 Mr. Jereis said that provided the developer made certain 21 changes in the project, he thought he could be helpful? 22 A. Not at the end, sometime during the meeting. 23 Q. Now, you testified on Thursday that after the vote on 24 September 26, you met with Mr. Jereis in his car outside of 25 Trotter's restaurant in White Plains, correct? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1828 C35Qann4 Mangone - Cross 1 A. No, sir. 2 Q. When did you meet with Mr. Jereis at Trotter's? 3 A. July of '06. 4 Q. July of '06. And at that time, that's when you say you 5 gave him money, correct? 6 A. Yes. 7 Q. Now, when you met with the FBI on May 1 of 2008, didn't you 8 tell them that you don't recall where or when it was that you 9 delivered the $10,000 to Mr. Jereis? 10 A. That was in connection with the September 2006 payment. 11 That was the second payment. That came the day after the vote. 12 Q. OK. Just bear with me one minute. With respect to the 13 first payment, didn't you tell the FBI during your March 19, 14 2010 meeting with them that you're not certain whether you 15 actually gave Mr. Jereis the full $10,000? 16 A. I never counted it when Mr. Milio gave it to me, so I don't 17 know if it was all 10,000 of it, but I assume that it was all 18 there. 19 Q. How do you know if it was 10,000 if you never counted it in 20 the first place? 21 A. Because he said to me it was $10,000, and it was this thick 22 in hundred dollar bills. It appeared to be $10,000. 23 Q. That's not what you told the FBI on March 19, was it? You 24 said you were not certain -- you said, did you not, that you 25 believe it was $10,000, but you're not certain. Isn't that SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1829 C35Qann4 Mangone - Cross 1 what you told them? 2 A. Yes. 3 Q. According to your testimony, you testified that there were 4 two deliveries of money after the Longfellow vote was approved, 5 correct? 6 A. No, I said there was one payment in July when the matter 7 should have been on the agenda, and then there was another 8 $20,000 payment for my success fee on September 27, 2006 and an 9 additional $10,000 payment on September 27, 2006. 10 Q. So how much money was there on September 27? 11 A. Total of 30. 12 Q. 30. Was that when you went -- is that when you went on 13 your trip to Atlantic City? 14 A. No. 15 Q. When did you go on your trip to Atlantic City? 16 A. The 29th. 17 Q. 29th of? 18 A. September. 19 MR. ARONWALD: May I have a moment, your Honor? 20 THE COURT: Yes. 21 (Pause) 22 BY MR. ARONWALD: 23 Q. You testified that the $20,000 success fee, is that what 24 you called it? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1830 C35Qann4 Mangone - Cross 1 Q. You testified that you split that with your partner Michael 2 Santangelo? 3 A. Yes. 4 Q. And then you took your 10,000 and went to Atlantic City? 5 A. Yes. 6 Q. Are you sure that you didn't give any of that $20,000 to 7 your mentor, Senator Nick Spano? 8 MR. CARBONE: Objection. 9 A. Absolutely certain. 10 Q. You never gave any money to Nick Spano in connection with 11 the Longfellow project? 12 MR. CARBONE: Objection. Good faith basis. 13 A. Absolutely not. 14 THE COURT: The question has been answered. 15 Q. Mr. Mangone, you would agree, would you not, that the 16 stakes in this case in which you're testifying are much higher 17 for you than they were when you appeared before the grand jury 18 in a trial in the Wedra case, correct? 19 A. Yes. 20 Q. In the Wedra case, you were only trying to protect Senator 21 Spano, correct? When you -- strike that. When you lied under 22 oath and said that Senator Spano had no knowledge of the forged 23 absentee ballot scheme that you were involved in, you lied and 24 said that he had no knowledge, and that lie was to protect 25 Senator Spano, wasn't it? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1831 C35Qann4 Mangone - Cross 1 A. Yes. 2 Q. And in this case the testimony you are giving is an attempt 3 to protect yourself, correct? 4 A. Yes. 5 Q. To make sure that you get as light a sentence as possible, 6 correct? 7 A. Just to tell the truth, sir. 8 Q. Just to tell the truth. And you're telling the truth here 9 pursuant to the same oath that you took to tell the truth in 10 the Wedra case, correct? 11 A. That's correct. 12 Q. And, once again, we have only your word for the proposition 13 that you passed any money to Zehy Jereis at any time in 14 connection with the Longfellow project, isn't that so? 15 A. Yes. 16 MR. ARONWALD: Thank you. No further questions. 17 REDIRECT EXAMINATION 18 BY MR. CARBONE: 19 Q. Good afternoon, Mr. Mangone. 20 A. Good afternoon. 21 Q. Now, when you say you are testifying here, that your 22 interest is in protecting yourself, can you tell the jury how 23 it is that you do that under the terms of your plea agreement? 24 A. Testify truthfully, provide accurate information, and then 25 there's an obligation on behalf of the government that they SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1832 C35Qann4 Mangone - Redirect 1 bring my cooperation to the attention of the Court. 2 Q. And you were just asked by Mr. Aronwald about a statement 3 about whether you were certain that it was $10,000 that you 4 handed to Mr. Jereis. Could it have been 10,100? 5 A. Yes. 6 Q. Could it have been 9,900? 7 A. Yes. 8 Q. And what did Mr. Milio tell you when you got the money 9 about the amount? 10 A. Here's the $10,000. 11 Q. When you gave it to Mr. Jereis, did he ever call you back 12 and complain and said "you shorted me"? 13 A. No. 14 Q. Did he count it in front of you when you gave to him? 15 A. No. 16 Q. You were just asked also by Mr. Aronwald about sharing fees 17 with Mr. Servino after he left the firm and became a member of 18 the district attorney's office, do you recall that? 19 A. Yes. 20 Q. Can you tell the jury why you didn't want to share fees 21 with Mr. Servino after he left your firm? 22 A. There -- the money came in in December of '06. He had 23 already notified us that he would be leaving the end of that 24 month starting January of 0 -- I'm sorry, December of '05; he 25 would be leaving January of '06. There were two cases in which SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1833 C35Qann4 Mangone - Redirect 1 we held the money. One of the cases in fact were in front of 2 the same office that he was going to be working for. They were 3 fees that were paid for the entire case, and, as a result, 4 there were going to be expenses that were going to be 5 prospective throughout the case, and thus we decided that we 6 weren't going to share those fees with him. 7 Q. Now, you were asked a series of questions about whether you 8 actually know what Mr. Jereis did with the money that you gave 9 him to influence Ms. Annabi's vote, do you recall that? 10 A. Yes. 11 Q. And I think you said that you didn't actually know. Can 12 you tell us when you first discussed the bribe payment with 13 Mr. Jereis, what, if anything, did he say about what he needed 14 the money for? 15 A. Just that -- to get Sandy on board, she was hounding him 16 for money, and he needed money to get her on board. 17 Q. When you spoke to him right after the July 11 city council 18 meeting, what, if anything, did he say about why he needed the 19 money at that point? 20 A. That they had delivered and they should be paid. 21 Q. You were also asked about which council member supported 22 the Longfellow project in April and May of 2006, do you recall 23 that? 24 A. Yes. 25 Q. What is your understanding about what would happen in the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1834 C35Qann4 Mangone - Redirect 1 city council if Sandy Annabi changed her position in support of 2 the project? 3 A. That it would come out of the real estate committee meeting 4 and be voted on by the entire council. 5 Q. And what was the significance of her support for the 6 project? 7 A. It was -- it wouldn't come out of real estate committee 8 meeting until the council member from that district gave it her 9 blessing, in essence. 10 Q. I'm sorry, whose council district was that in? 11 A. It was partly in Ms. Annabi's district and partly in 12 Ms. MacDow's. 13 Q. You were asked a series of questions about why you didn't 14 go directly to Mr. Jereis -- I'm sorry -- Ms. Annabi and why 15 you went to Zehy Jereis. What, if anything, understanding did 16 you have about whether this is something that you could have 17 gone or should have gone through Mr. Jereis for? 18 A. I knew Zehy would have access to her, so I went through 19 Zehy. 20 Q. You were asked about Mr. DelBello's very fine credentials, 21 and you were also asked about why you didn't go and talk to him 22 and tell him that you were involved in the case. Do you recall 23 those series of questions? 24 A. Yes. 25 Q. Do you recall Mr. Aronwald asking whether you were aware SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1835 C35Qann4 Mangone - Redirect 1 that Mr. DelBello had done certain things in connection with 2 his representation of the Milios, do you recall that? 3 A. Yes. 4 Q. What, if any, understanding did you have about whether he 5 was getting results for the Milios? 6 A. According to the Milios, he wasn't getting anywhere, and 7 that's why they contacted me to be retained. 8 Q. What was your understanding about why you were hired by the 9 Milios. 10 A. To get the project approved. 11 Q. What effect did Ms. Annabi's support for the project have 12 on the other council members? 13 A. They weren't opposed to the project. They were opposed to 14 letting it out of the real estate committee until Ms. Annabi 15 had resolved her issues regarding the project and the 16 conditions. 17 MR. CARBONE: Mr. Turk, would you broadcast Government 18 Exhibit 700. 19 Q. Why didn't you call Al DelBello and tell him you were 20 involved? 21 A. Mr. Milio told me Mr. DelBello didn't want to work with me. 22 Q. Referring to Government Exhibit 700, can you remind the 23 jury who you were speaking with when you wrote this email to 24 Franco Milio? 25 A. Zehy Jereis. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1836 C35Qann4 Mangone - Redirect 1 Q. When you wrote this email to Franco Milio, what were you 2 communicating? 3 A. The conditions of which Ms. Annabi would approve the vote. 4 Q. Where did you get that information from? 5 A. Mr. Jereis. 6 Q. At the time that you sent this email to Franco Milio, what 7 was your understanding about whether Sandy Annabi was going to 8 support the project? 9 A. That she would support it. 10 Q. When you said the phrase "the appraisal was being done for 11 her own selfish political gain," who were you referring to? 12 A. Ms. Annabi. 13 Q. Mr. Mangone, you were asked a series of questions on 14 cross-examination about the subject of payments that were made 15 to certain Putnam County officials in relation to legal work. 16 Do you recall those questions? 17 A. Yes. 18 Q. When did you start working at the law firm of Servino, 19 Santangelo and Randazzo? 20 A. December 2001. 21 Q. When you started, what position did you hold? 22 A. Associate. 23 Q. What is an associate (Counter)? 24 A. An attorney who works on behalf of the firm. 25 Q. Were you a partner in the firm? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1837 C35Qann4 Mangone - Redirect 1 A. No. 2 Q. Did you initiate the payments to any public official up in 3 Putnam County? 4 A. No, it was already in effect. 5 Q. When in relation to your being hired did the payments 6 begin? 7 A. They had already started before I became hired. 8 Q. Did you orchestrate or direct the payments? 9 A. No. 10 Q. Who was the most junior member of the firm at that time? 11 A. Myself. 12 Q. When I say member of the firm, you weren't even a partner 13 yet, right? 14 A. No, I was a young associate then. 15 Q. Was the Putnam County account your account? 16 A. No, sir. 17 Q. Did you review any of the partners who you worked for 18 billing records in connection with Putnam County at the time? 19 A. No. 20 Q. What was your role -- did you then have a role later on in 21 connection with these payments? 22 A. To the extent -- I would give money to Mr. Servino. 23 Q. What exactly was your role? 24 A. Cash checks and give him money. 25 Q. Other than on the one occasion that Mr. Siano referred to SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1838 C35Qann4 Mangone - Redirect 1 where you gave Mr. Leibell money, did you actually make any of 2 the payments to those Putnam County officials? 3 A. No. 4 Q. Now, let's talk for a minute about your escrow fund. Can 5 you explain what an escrow account is? 6 A. Yes. It's an account maintained by an attorney where 7 monies from clients are deposited during the pendency of a 8 case, whether it be a personal injury case, a real estate case, 9 settlement for any type of a lawsuit settlement. 10 Q. How does an attorney take fees from an escrow account? 11 A. They write themselves a check and it goes to the firm. 12 Q. Anything improper about that? 13 A. No. 14 Q. Can you tell the jury when in connection with a real estate 15 transaction the attorney's fee is paid when the money is held 16 in escrow? 17 A. When the closing is completed. 18 Q. Are there times when you take a retainer from a client? 19 A. Yes. 20 Q. Are those funds ever put into a trust account? 21 A. Yes. 22 Q. Then when does the attorney take the fee out of the trust 23 account? 24 A. They draw down on it as it's termed. 25 Q. Once you earn it, then the money comes out of the trust SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1839 C35Qann4 Mangone - Redirect 1 account, it's no longer the client's money, and it becomes the 2 lawyer's money? 3 A. Correct. 4 Q. Did you ever transfer fees directly from your escrow 5 account into your personal account? 6 A. Yes. 7 Q. And you didn't report some of those fees? 8 A. That's correct. 9 Q. Is that what you pled guilty to? 10 A. Yes. 11 Q. Just to be clear, you testified on cross about the subject 12 of using escrow funds to pay gambling markers. Can you explain 13 how it is that you did that? 14 A. Well, instead of depositing the money from the escrow funds 15 that were my legal fees into my operating account, I put it 16 into my personal account which is where the marker would have 17 come paid and due and -- and I never paid taxes on that money. 18 Q. So just to be clear, you never used your escrow account to 19 directly pay casinos for markers? 20 MR. ARONWALD: Leading, your Honor. 21 THE COURT: I'm sorry? 22 MR. ARONWALD: Objection. Leading. 23 THE COURT: The objection is sustained. 24 Q. Mr. Mangone, did you ever use your escrow account to 25 directly pay casinos? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1840 C35Qann4 Mangone - Redirect 1 MR. ARONWALD: Objection. Leading. 2 Q. When, if ever -- 3 THE COURT: I haven't ruled -- you can answer that 4 question. Did you ever do that? 5 THE WITNESS: No. 6 Q. Did you ever steal your client's escrow funds? 7 A. No. 8 Q. When you would get a marker at a casino, what account of 9 yours was that marker posted against? 10 A. My personal account. 11 Q. Mr. Siano asked you a series of questions about gambling 12 losses in 2004 and 2005, do you recall that? 13 A. Yes. 14 Q. Do you recall him asking how much money was quote "pushed 15 through the window"? 16 A. Yes. 17 Q. Do you know exactly what he meant by that? 18 A. I'm assuming he meant cash that was put at the window for 19 chips. 20 Q. Were there occasions where you actually got cash from the 21 casino? 22 A. Yes. 23 Q. When would that happen? 24 A. There are two ways of drawing a marker. You could either 25 draw chips at the window or you could draw down cash. So it's SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1841 C35Qann4 Mangone - Redirect 1 just a matter of signing the check, the voucher that they give 2 you. 3 Q. Would the casino also give you cash if you win? 4 A. Yes. 5 Q. Did you win on occasion in 2004 and 2005? 6 A. Yes. 7 Q. When you would borrow money or use markers, did you pay the 8 debts as you went along? 9 A. Yes. 10 Q. When you get a marker, how long do you have before you can 11 pay it back? 12 A. 45 days if it's over $5,001. 13 Q. When you were asked about gambling activity between 2004 14 and 2006, are you accumulating debt from the losses? 15 A. Yes. 16 Q. How frequently do you have to pay off the debt? 17 A. 45 days. 18 Q. What source of funds did you use to pay off those markers? 19 A. Other markers from other casinos, and my own funds. 20 Q. Mr. Mangone, do you recall being asked about the 21 inconsistencies between what you had to say and what the Milios 22 had to say? 23 A. No. 24 Q. Let me rephrase it. At the time the indictment was 25 returned in this case, were you given a copy of the first SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1842 C35Qann4 Mangone - Redirect 1 indictment, the indictment to which you pled guilty? 2 A. Yes. 3 Q. Were you given access to discovery materials? 4 A. Yes. 5 Q. Had you read the indictment? 6 A. Yes. 7 Q. Did you review the discovery materials before you agreed to 8 come in and cooperate? 9 A. Somewhat. 10 Q. What, if anything, did the indictment say about the Milios 11 statements? 12 A. That they had given me money to pass along to a council 13 person. 14 Q. What, if anything, did they say -- what did the original 15 indictment say about the number of payments? 16 A. They had said they had given me one payment in June of 2006 17 for $30,000. 18 Q. When you came in and began to cooperate, were you aware 19 that the Milios -- the details of their statement? 20 A. Yes. 21 Q. Did you make any effort to tailor your testimony to be 22 consistent with the Milios' testimony? 23 MR. ARONWALD: Objection, your Honor. This is 24 leading. 25 THE COURT: It's true. The objection is sustained. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1843 C35Qann4 Mangone - Redirect 1 Q. What, if any, efforts did you make after you began to 2 cooperate to tailor your statements, your testimony, to the 3 statements that the Milios had made? 4 A. None. 5 Q. Why not? 6 A. Because that was my recollection of what had transpired. 7 Q. What happens on the plea agreement if you don't tell the 8 truth? 9 A. There's -- you get to not write a 5K letter, and I get to 10 be sentenced and charged with perjury. 11 Q. Mr. Mangone, when did you testify in that Wedra case? 12 A. February of 2002. 13 Q. And that's approximately ten years ago? 14 A. Yes. 15 Q. After you began to cooperate with the government in this 16 case, how many false statements have you made to the 17 government? 18 MR. ARONWALD: Objection. Your Honor. 19 THE COURT: Overruled. 20 A. None. 21 Q. Again, when you said you testified falsely in the Wedra 22 case -- 23 A. Yes. 24 Q. -- did you testify falsely about your role in the case? 25 A. No. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1844 C35Qann4 Mangone - Redirect 1 Q. What did you lie about? 2 A. About whether Senator Spano knew I was collecting absentee 3 ballots. 4 Q. You were asked a series of questions about answers that you 5 gave in connection with an interview that took place before you 6 began to cooperate in this investigation on April 30 of 2008. 7 Do you recall that? 8 A. Yes. 9 Q. Do you recall approximately how long that interview lasted? 10 A. About an hour. 11 Q. Did you discuss at that meeting every detail about your 12 involvement in the Longfellow project? 13 A. No. 14 Q. How did the length of that meeting and the details 15 discussed compare to meetings that you had with the government 16 after you began to cooperate in 2010? 17 A. They were much more significantly in time pronounced, they 18 went through every detail. 19 Q. You went through every detail when? 20 A. In March 2010. 21 Q. After you began to cooperate? 22 A. Yes. 23 Q. To be clear, the FBI 302 forms that you were shown -- 24 A. Yes. 25 Q. -- you did lie in the April 30, 2008 interview before you SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1845 C35Qann4 Mangone - Redirect 1 began to cooperate? 2 A. Yes. 3 Q. Is that a verbatim transcript of the questions you were 4 asked and the answers you gave? 5 A. No. 6 Q. What, if anything, did you tell the government at the 7 April 30, 2008 meeting, which for the record is 3517-A, about 8 the subject of whether you met with the Milios before the 9 meeting you had with Jereis in your office? 10 A. I told them that I met at Reno's on Lockwood Avenue with 11 Giuseppe Milio, with Romeo Milio, Dominick Miano Franco Milio 12 and my Uncle Joe. 13 Q. Can you tell the jury what you said at that very first 14 meeting long before you began to cooperate about the subject of 15 how much money Zehy Jereis had asked you for? 16 A. The meeting at Reno's? 17 Q. No, in the meeting after your office meeting in Milios and 18 Zehy Jereis? 19 A. I don't understand the question. 20 Q. Did you discuss at the very first meeting when you came in 21 to the U.S. Attorney's office on April 30 of 2008 the subject 22 of how much money Zehy Jereis wanted you to give him from the 23 Milios? 24 A. Yes. 25 Q. Do you recall what you told the FBI agents in that meeting SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1846 C35Qann4 Mangone - Redirect 1 about how much money Jereis wanted to be paid from Milios for 2 getting access to Annabi? 3 A. Initially, it was a hundred thousand. 4 Q. Do you recall Mr. Aronwald showing you another one of those 5 FBI 302 forms and him directing your attention to a statement 6 you made about how Matt Libous's salary was treated? 7 A. Yes. 8 Q. How was Matt Libous's salary treated on the books and 9 records of the law firm? 10 A. It was reported. 11 Q. Was he treated as an employee? 12 A. Yes. 13 Q. During the time period that Matt Libous actually worked for 14 the firm before you testified that you became dissatisfied with 15 his services, what was his status at the firm? 16 A. He was an associate. 17 Q. Did that change later on? 18 A. Yes. 19 Q. Approximately how long after he started did that change? 20 A. I would probably say sometime around the fifth or sixth 21 month that he was working there, we just made him of counsel 22 because we had an issue -- we were concerned regarding 23 liability issues. 24 Q. After Mr. Libous was no longer employed by the firm, did 25 you continue to pay him as an of counsel? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1847 C35Qann4 Mangone - Redirect 1 A. Yes. 2 Q. Were there occasions where he was paid as for referring 3 matters? 4 MR. ARONWALD: Your Honor, could we just -- all 5 leading in this category? Objection. Leading. 6 THE COURT: The objection is sustained. 7 Q. Mr. Mangone, what, if any, change in Mr. Libous's status at 8 the firm impact did that have on the way he was paid? 9 A. He would then -- he was no longer paid as an employee. He 10 was paid almost like a contractor. 11 Q. Exactly when did you begin the process of cooperating with 12 the government? 13 A. March 2010. 14 Q. When did you finally enter into an agreement with the 15 government? 16 A. November 2010. 17 Q. During that time period, approximately how many times did 18 you meet with the government? 19 A. Ten or eleven. 20 Q. During those meetings, did you discuss matters unrelated to 21 this case? 22 A. Yes. 23 Q. Were you represented by counsel in connection with your 24 disbarment proceedings? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1848 C35Qann4 Mangone - Redirect 1 Q. Did you testify on cross-examination about your offering of 2 resignation? 3 A. Yes. 4 Q. Did the Bar Association accept your resignation? 5 A. No. 6 Q. Did you practice law after the court entered an order 7 disbarring you? 8 A. No. 9 Q. You were asked questions about whether the topic or the 10 subject of whether Zehy Jereis and Sandy Annabi were sleeping 11 together came up at the meeting in your office, do you recall 12 that? 13 A. Yes. 14 Q. Who brought that up? 15 A. I believe Mr. Miano. 16 Q. Was Zehy Jereis present for that? 17 A. No. 18 Q. Did you have any personal knowledge of that? 19 A. No. 20 Q. Did Dominick Miano appear to have any personal knowledge of 21 that? 22 A. No. 23 Q. So it's fair to say he was just asking? 24 MR. ARONWALD: Objection. 25 MR. SIANO: Objection. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1849 C35Qann4 Mangone - Redirect 1 MR. ARONWALD: Leading. 2 THE COURT: The objection is sustained. 3 MR. CARBONE: I'll withdraw the question, your Honor. 4 Q. You were asked about whether you were assisting the Milios 5 in committing money laundering, do you recall that? 6 A. Yes. 7 Q. Are you familiar with the crime of money laundering? 8 A. Yes. 9 Q. Do you know what a specified unlawful activity is? 10 A. No, not particularly. 11 Q. Do you know whether by accepting money into your trust 12 account from a third party, do you know whether that was money 13 laundering? 14 A. No. 15 Q. Do you know whether that deal that you talked about with 16 that other lawyer when Mr. Santangelo gave him a check for 17 cash, do you know whether that was money laundering? 18 A. No. 19 Q. You were asked about the cash payment you made to John 20 Khader in connection with bribing a potential candidate, do you 21 recall that? 22 A. Yes. 23 Q. Who communicated the bribe request to you? 24 A. Mr. Jereis. 25 Q. You were asked about Pat Stiso. Are you familiar with a SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1850 C35Qann4 Mangone - Redirect 1 company known as Federal Prison Services? 2 A. Yes. 3 Q. What is that company? 4 A. It's consulting firm that Mr. Stiso had. 5 Q. Did Mr. Stiso ever practice law at your firm? 6 A. No. 7 Q. You were asked about the amount of unreported income in 8 2006 and in 2006 returns, do you recall that? 9 A. Yes. 10 Q. What, if any, percentage of the unreported income on your 11 2006 return came from unreported fees? 12 A. In '06 -- 13 Q. Let me rephrase the question. Did any of the unreported 14 income on your 2006 return have anything at all to do with real 15 estate transactions? 16 A. Yes. 17 Q. What is the maximum sentence you could receive on the tax 18 charge that you pled guilty to? 19 A. Five years. 20 Q. What is the maximum sentence you could receive on the 21 bribery charge that you pled guilty to in connection with Sandy 22 Annabi and Zehy Jereis? 23 A. Ten years. 24 Q. You were asked about whether you had ever filed false tax 25 returns prior to 2003. Prior to the time you became a partner SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1851 C35Qann4 Mangone - Redirect 1 at the law firm, how did you get paid? 2 A. On a W2. 3 MR. CARBONE: No further questions. Thank you. 4 THE COURT: Mr. Siano. 5 MR. SIANO: No further questions, your Honor. 6 THE COURT: Mr. Aronwald. 7 MR. ARONWALD: May just have a moment, your Honor? 8 RECROSS EXAMINATION 9 BY MR. ARONWALD: 10 Q. Mr. Mangone -- 11 A. Yes. 12 Q. -- the plea agreement that you entered into with the 13 government, that agreement does not require you to tender your 14 resignation from the bar of the State of New York, does it? 15 A. No. 16 Q. The agreement does not in any way prevent you from 17 continuing to practice law even if the law of the New York 18 State requires that you be disbarred on the effective date of 19 your plea, correct? 20 A. I don't know the answer to the question. 21 Q. The plea agreement that you have with the government 22 doesn't in any way touch upon whether or not you should or 23 should not continue to practice law after your guilty plea, 24 does it? 25 A. It says don't commit any other crimes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1852 C35Qann4 Mangone - Recross 1 Q. It does not in any way touch on the subject of whether you 2 should be permitted to continue to practice law after the 3 effective date of your guilty plea, does it? 4 A. No. 5 MR. CARBONE: May I have one question, your Honor? 6 I'm sorry. 7 THE COURT: Not now. 8 BY MR. ARONWALD: 9 Q. By the way, Mr. Carbone asked you whether or not the 10 instances -- the FBI 302s that you were shown, the reports? 11 A. Yes. 12 Q. And just so the jury understands, a 302 is a report 13 prepared by an FBI agent of the interview or meeting that takes 14 place between you and the agent and other people from the 15 government, correct? 16 A. Correct. 17 Q. It's a report that the agent prepares, correct? 18 A. Yes. 19 Q. In this case the agent was Special Agent Michael Mazzuca 20 who is seated at counsel table, correct? 21 A. Yes. 22 Q. To the extent that you have denied making statements that 23 are reflected in that FBI 302, just so it is clear, it's your 24 position that Agent Mazzuca mistakenly characterized the 25 statements that his report reflects you made, correct? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1853 C35Qann4 Mangone - Recross 1 A. Yes. 2 Q. So you're saying that what he put in the report is not what 3 you told him? 4 A. Might have been a discrepancy. 5 Q. Do you remember Mr. Siano asked you a series of questions 6 and you flat out denied making the statements attributed to you 7 in that 302? 8 A. Yes. 9 Q. And your explanation for that is that Agent Mazzuca made a 10 mistake and didn't reflect what you told him accurately, 11 correct? 12 A. Yes. 13 Q. And that's the same with respect to any other FBI 302 that 14 was taken by any other agent, including Special Agent Gilmore, 15 correct -- 16 A. I can only -- 17 Q. -- the female agent? 18 A. Only what I -- questions were asked of me and what the 19 discrepancies were, that's the only thing I could tell you. 20 Q. To the extent that you disagree with any of the statements 21 attributed to you in any of these FBI 302s, it is your position 22 that the agent who was responsible to prepare that report got 23 it wrong and did not accurately reflect what you said, correct? 24 MR. CARBONE: Objection. Asked and answered. 25 THE COURT: Objection is sustained. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1854 C35Qann4 Mangone - Recross 1 MR. ARONWALD: The question before was limited only 2 with respect to Mazzuca, your Honor. 3 THE COURT: The objection is sustained. 4 MR. ARONWALD: No further questions. 5 MR. CARBONE: No further questions. 6 THE COURT: Thank you. 7 Mr. Mangone, you may step down. Call your next 8 witness, please. 9 (Witness excused) 10 MR. HALPERIN: Your Honor, the government has a 11 stipulation at this time. I should say the parties have a 12 stipulation. 13 THE COURT: OK, folks. All right. So it is hereby 14 stipulated and agreed by and among the usual suspects as 15 follows: That if a representative of Cablevision were to 16 testify at trial, he would testify under penalty of perjury 17 that he is a custodian of records or other qualified person, as 18 those terms are used in Rule 803.6 and 902.11. That's rules of 19 the Federal Rules of Evidence. And that he has examined 20 Government Exhibits 1502 and 1502-A, and that those records are 21 true and accurate business records of Cablevision that: 22 (A) Were made at or near the time of the occurrence of 23 the matters set forth by, or from information transmitted by, a 24 person with knowledge of these matters; 25 (B) Were kept in the ordinary course of the regularly SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1855 C35Qann4 Mangone - Recross 1 conduct activity of the business as a regular practice; 2 (C) Were made by the regularly conducted activity as 3 a regular practice; 4 And (D) if not original records are accurate 5 duplicates of the originals of record. 6 And exactly the same things are stipulated with 7 respect to AT&T with respect to Government Exhibit 1509 and 8 Cingular Wireless with respect to Government Exhibit 1508. 9 So the stipulation which is Government Exhibit 2 is 10 admitted into evidence. 11 (Government's Exhibit 2 received in evidence) 12 THE COURT: Are you offering the Exhibits? 13 MR. HALPERIN: We are, your Honor. 14 THE COURT: Any objection? 15 MR. ARONWALD: No, your Honor. 16 MR. SIANO: No, your Honor. 17 THE COURT: Exhibits 1502, 1502-A, 1508 and 1509 are 18 admitted. 19 (Government's Exhibits 1502, 1502-A, 1508 and 1509 20 received in evidence) 21 THE COURT: Call your next witness. 22 (Continued on next page) 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1856 C35UANN5 Enright - direct 1 MR. HALPERIN: Your Honor, the government calls Joseph 2 Enright. 3 JOSEPH ENRIGHT, 4 called as a witness by the government, 5 having been duly sworn, testified as follows: 6 DIRECT EXAMINATION 7 BY MR. HALPERIN: 8 THE COURT: You may inquire. 9 MR. HALPERIN: Thank you, your Honor. 10 Q. Good afternoon, sir. 11 Where do you work, sir? 12 A. Federal Bureau of Investigation. 13 Q. What is your title at the FBI? 14 A. Intelligence analyst. 15 Q. How long have you worked with the FBI? 16 A. About eight years. 17 Q. What are your duties and responsibilities as an 18 intelligence analyst with the FBI? 19 A. I conduct research and analysis of information and data 20 that is conducted in the course of investigations. And 21 sometimes I will write reports about findings based on that 22 analysis that gets disseminated throughout the FBI to other law 23 enforcement agencies. 24 Q. What if anything do you do in relation to phone contact 25 analysis? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1857 C35UANN5 Enright - direct 1 A. I am often asked to analyze sets of phone records that are 2 obtained by the FBI pursuant to grand jury subpoenas. 3 Q. Generally speaking, what does that process entail? 4 A. Well, the phone company provides historical information 5 about phone calls that look much like the bills that you might 6 receive for your own phone. They show the contact that's being 7 billed to a phone. 8 And I just like to point out that the information that 9 the phone company provides to us in response to these grand 10 jury subpoenas are just contact information like the other 11 phone numbers that the subject phone that we have subpoenaed is 12 calling or texting; there is no content information at all. 13 Q. What do you mean when you say "content information"? 14 A. There is no -- like for instance, for a text message, it 15 will just show the other phone number that is receiving the 16 text. It won't have the body of a text. And for voice phone 17 calls, there will be no recording. It is just a simple phone 18 number to phone number. 19 Q. Now, did you analyze telephone data in a case involving 20 people named Sandy Annabi and Zehy Jereis? 21 A. Yes, I did. 22 Q. You have never seen those two people in person, correct? 23 A. No. 24 Q. What work did you do for this case, sir? 25 A. Well, I was asked to look at the data that was collected as SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1858 C35UANN5 Enright - direct 1 a result of grand jury subpoenas. I guess there were somewhere 2 around 15 grand jury subpoenas that were served. There were a 3 lot of phone records that were collected but I was asked to 4 concentrate on the phones belonging to four persons and they 5 amounted to seven phones in particular because I was asked to 6 look particularly at the year 2006. 7 Q. Who were the four persons you just referred to? 8 A. Anthony Mangone, Sandy Annabi, Zehy Jereis and Franco 9 Milio. 10 Q. How many sets of phone records did you focus on for those 11 four people in this case? 12 A. Seven sets of records. 13 Q. What were those seven sets of phone records? I am not 14 asking for specific phone numbers, but what were they 15 generally? 16 A. Well, the phone company generally provides paper records 17 and sometimes electronic copies of the paper records to the 18 FBI. 19 Q. When you talk about those seven sets of records, were they 20 home phones, cell phones -- which were they specifically? 21 A. Well, there were two cell phones for Sandy Annabi. There 22 was one cell phone for Mr. Jereis. There was one cell phone 23 for Mr. Mangone, one cell phone for Franco Milio. And there 24 was one home phone for Sandy Annabi and one home phone for 25 Mr. Jereis. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1859 C35UANN5 Enright - direct 1 Q. I think you said this, but what year did you focus on, sir? 2 A. 2006, calendar year 2006 only. 3 Q. I am now going to show you what's been marked as Government 4 Exhibit 1500, 1500A, 1501 and 1501A. And these have all been 5 received in evidence. 6 MR. HALPERIN: Your Honor, may I approach? 7 THE COURT: You may. 8 Q. Sir, I will ask you just to focus on for now 1500, 1500A, 9 1501 and 1501A. Who does these records relate to? 10 A. These were the phone records for Anthony Mangone. They 11 consist of paper records and, in some instances, records that 12 are on disks. 13 Q. Let me direct you now to 1502, 1502A, 1503, 1504, 1505 and 14 1505A which the Court has received. Who did these records 15 relate to, sir? 16 A. Sorry. These are all for Sandy Annabi. And they all 17 appear to be disks. 18 Q. I am now going to ask you to look at the folder with 1506 19 and 1509. I am also going to hand up 1508. Again, the Court 20 has received all of these. 21 A. 1508, 1509 were disks pertaining to the phones of Zehy 22 Jereis. And these two binders are the Cingular phone records 23 for Zehy Jereis. 24 Q. What number is on those binders, just for the record? 25 A. 1508. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1860 C35UANN5 Enright - direct 1 MR. HALPERIN: One moment, Judge. 2 (Discussion off the record between counsel) 3 Q. Sir, I will ask you to look at the folders for 1510 and 15A 4 which the Court has received into evidence. Who do these 5 records relate to? 6 A. There is a disk for Franco Milio and then there is paper 7 pertaining to his subscriber records for Franco Milio. 8 Q. Now, in preparation for this trial, did you analyze all of 9 these records which are in evidence? 10 A. Yes, I did. 11 Q. How are all of these records received by the government? 12 A. Again, they were received in paper format and in disk -- on 13 disk -- sometimes both, sometimes only one format. 14 Q. Through what process did the government receive these 15 records originally from the separate phone carriers? 16 A. They were received pursuant to grand jury subpoenas, and 17 when they arrived on disk we uploaded them in to the computer 18 and when they arrived on paper, they get typed in or scanned 19 in. 20 Q. And what type of information about the subscribers did 21 these phone records contain? 22 A. They contain the name and address of the person who is 23 paying for the phone and the date when the usage of the phone 24 started and various other details. 25 Q. So for each phone record, is that information included from SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1861 C35UANN5 Enright - direct 1 a carrier? 2 A. Yes. 3 Q. Now, how did you go about analyzing these phone records? 4 A. Well, these were a lot of phone records. I think there 5 were close to 200,000 phone calls and texts altogether, 6 contacts among the subjects. So I just culled out from that 7 amount the 2006 contacts to look at. So what I did was, I 8 culled them out and I formed an Excel spreadsheet containing 9 just the 3809 contacts, text and voice calls between or among 10 four subjects. 11 Q. So out of a total population of 200,000, you culled out 12 roughly how many contacts? 13 A. About 3800. 14 Q. In preparation for trial, did you create a chart 15 summarizing some of these phone records? 16 A. Yes, I did. I created a number of charts. 17 Q. I am going to show you what is marked Government Exhibit 18 1515 through 1532. Please take a moment and flip through that. 19 Sir, do you recognize those items? 20 A. Yes, I do. These were the charts that I prepared based on 21 those 3800 phone calls and text messages. 22 Q. Will these charts assist you here in your testimony here 23 today? 24 A. Yes, they will. 25 Q. And what year do these charts relate to? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1862 C35UANN5 Enright - direct 1 A. They all relate to activity on phones in 2006. 2 Q. Let me first direct you to Government Exhibit 1515 which 3 you have in front of you. 4 A. Yes, I have it. 5 Q. What is this document, sir? 6 A. This is a 95-page spreadsheet that shows the 3800 contacts 7 that I have been talking about. It is sorted in date order. 8 In other words, the first entry is from January 1st and the 9 last entry on page 95 is December 31st of 2006. 10 Q. Who created this master chart? 11 A. I created it. 12 Q. And what did you create it based on? 13 A. Based on the nearly 200,000 records that we had received 14 from a number of different phone companies. 15 Q. Let me ask you to turn to page 95. 16 A. I have it. 17 Q. What government's numbers is this chart based on? 18 A. It is based on Government Exhibits 1500 through 1506 and 19 1508 through 1510A. 20 Q. Is that what you have to the left in front of you there, 21 sir, those binders -- 22 A. Yes. Those are the phone company records I just talked 23 about. 24 Q. So explain to the jury how you went about creating this 25 95-page chart. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1863 C35UANN5 Enright - direct 1 A. Well, I downloaded about 10 or 11 different pieces of data 2 about each phone contact. They consisted of the number that we 3 subpoenaed from the phone company and who was the subscriber 4 for that phone number we subpoenaed, and then followed by the 5 originating number for a phone call or a text message, followed 6 by the terminating number for the phone call or text message 7 and then the user or subscriber for who was placing the call or 8 text and who was receiving the call or text. And then after 9 that, just the date, the time of the call, the length of the 10 call, whether it was a phone call or a text message. And 11 that's it. 12 Q. Let me direct your attention now to Government Exhibits 13 1516 through 1532. 14 A. I have it. 15 Q. Take a moment and flip through those, please. Mr. Enright 16 what are these documents 1516 through 1532? 17 A. These are charts that I created that are really subsets of 18 the master list, of that 95-page list. 19 Q. Again, when you say the master list, the 95-page list you 20 are referring to Government Exhibit 1515? 21 A. That's correct. 22 Q. How did you go about creating these subset charts? 23 A. Well, I used common Excel commands like filtering and 24 sorting to extract out the phone calls that were associated 25 with each of the four subjects and looked at contacts between SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1864 C35UANN5 Enright - direct 1 one subject and another. I looked at them on a daily basis, on 2 a monthly basis. I looked at he frequency of calls for 3 particular ones and for all months and for all days of the 4 year. Again, this was just 2006. And so there were various 5 matches that I was making among the group of phones that I was 6 looking at. 7 MR. HALPERIN: Your Honor, at this point, the 8 government overs 1515 through 1532. 9 THE COURT: Any objection? 10 MR. ARONWALD: No objection. 11 MR. SIANO: No objection. 12 THE COURT: Admitted. 13 (Government Exhibits 1515 through 1532 received in 14 evidence) 15 MR. HALPERIN: Mr. Turk, could we please display 1515, 16 the first page. 17 Q. Mr. Enright, if can you look at the monitor in front of 18 you. 19 Just explain to the jury which document is this, sir? 20 A. This is Government Exhibit 1515. 21 Q. Which is what, again? 22 A. That is the 95-page list of all 3,809 calls among the four 23 subjects that I mentioned. 24 In addition, I also included calls that these subjects 25 or contacts -- these subjects had with a number of other SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1865 C35UANN5 Enright - direct 1 specified parties. And those parties we do not have subpoenaed 2 phone records for. They appear in these records as contacts to 3 the subpoenaed phones. 4 Q. Who were some of those parties that you were asked to look 5 at? 6 A. Those were various officials at Forest City Ratner, various 7 members of the Yonkers city council and, also, a jewelry store 8 in Yonkers. 9 MR. HALPERIN: Mr. Turk, can you highlight just the 10 top corner of page 1, including the title, the very top of the 11 page, please. That's fine. 12 Q. Mr. Enright, what is the title of this document, sir? 13 A. "2006 Calls." 14 Q. Just walk us through line 1 and go column by column and 15 explain what the data is on this page, please. 16 A. I would be happy to. 17 The first column is the phone number that we 18 subpoenaed the phone company for and asked them for records for 19 the phone number. 20 And the first one, the first number belongs to Jereis. 21 The records were subpoenaed from Verizon. It was his home 22 phone. And the first call from 2006 that emanated from that 23 phone that involved any of the four people that I mentioned was 24 a call from the Jereis home phone to the Anthony Mangone cell 25 phone which is listed there, the 403-3000 number. And that SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1866 C35UANN5 Enright - direct 1 occurred on New Year's Day January 1, 2006 at 9:49 a.m. And 2 there was no duration for the call, and this was a call that 3 was placed outbound from the subpoenaed number from the home 4 phone to the Mangone cell phone. 5 Q. When you say the home phone, the Jereis home phone? 6 A. Yes. 7 Q. Under "Text Flag" column, what is indicated for row 1? 8 A. There is no flag there, which indicates it was a contact 9 from a landline to a cell phone. 10 Q. Time zone is Eastern, is that correct? 11 A. That's correct. 12 Q. And then the last column is what? 13 A. Is the day of the week. 14 Q. Directing your attention about six or seven lines down 15 under the "text flag" column, what is listed there? 16 A. The word "text" appears. 17 Q. Indicating that that is a text message? 18 A. That is a text message from one cell phone to another from 19 the Sandy Annabi cell to the Zehy Jereis cell. 20 Q. Again, sir, you don't have as you said recordings of those 21 conversations, correct? 22 A. No, not at all. 23 MR. HALPERIN: Mr. Turk, let's go back to page 1, the 24 full shot. 25 Q. What is listed at the very bottom of the chart? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1867 C35UANN5 Enright - direct 1 A. Page number. 2 Q. So this is your 95-page master chart, is that right? 3 A. That's correct. 4 MR. HALPERIN: Let's go to page 95, Mr. Turk, the very 5 bottom, please if we could maximize that. 6 Q. Again, Mr. Enright, what exhibit is Government Exhibit 1515 7 based on? 8 A. It is based on Government Exhibits 1500 to 1506 and 1508 9 through 1510A which are the phone records that I talked about 10 in the paper and the disk records. 11 Q. For the record, you are indicating the binders in the 12 Redwelds on the table to your left? 13 A. Yes. 14 MR. HALPERIN: Mr. Turk, thank you. 15 Could we have 1516, please. Just highlight the chart 16 and cut out the yellow exhibit sticker. 17 Q. What is the heading on this chart, sir? 18 A. Daily contact totals between Jereis and Annabi phones in 19 2006. 20 Q. So when you say between Jereis and Annabi phones, which 21 phones does that include? 22 A. That includes their cell phones, their home phones and, in 23 the case of Ms. Annabi, her work phones. 24 Q. Just, is this a graph, essentially? 25 A. Yes. It is a line graph that shows the number of contacts SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1868 C35UANN5 Enright - direct 1 that occurred on each day. 2 Q. So for all 365 days in 2006, you have plotted what, 3 essentially? 4 A. The total number of contacts between -- that all of their 5 phones had with each other on that day, and that includes both 6 text and voice calls. 7 MR. HALPERIN: Let's go to page 2, Mr. Turk. Let's 8 highlight that, please. 9 Q. What is the highest number there, sir? 10 A. 81 contacts. 11 Q. What day did those 81 contacts occur? 12 A. That was on June 9th. 13 Q. Of what year? 14 A. 2006. 15 MR. HALPERIN: Let's go to the next page, Mr. Turk. 16 Q. And on this page, what is the highest number? 17 A. That's 77 calls. 18 Q. What day was that? 19 A. I believe that's -- I apologize for the display in this 20 chart, I am not much of an artist -- but it is November 9th. 21 It is hard to line up the dates here. 22 Q. We will come back to that. 23 MR. HALPERIN: Mr. Turk, can we have 1519, please. 24 Q. What is the header on this page, sir, 1519? 25 A. These were the phone contacts in 2006 for Jereis and Annabi SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1869 C35UANN5 Enright - direct 1 ranked by day. 2 Q. And the next line says. 3 A. Seven highest contact days in 2006. 4 Q. That means what, exactly? 5 A. These were the seven days that had the most contacts 6 between the Annabi phones and the Jereis phones. 7 Q. Down at the bottom of the page, you have a smaller chart. 8 What is that? 9 A. Well, that shows the ranking for each date and the total 10 number of contacts for each date. I also have a note for two 11 of the days in question. 12 Q. What was the highest ranked day in 2006? 13 A. It was June 9, 2006. 14 Q. With how many contacts? 15 A. 81. 16 Q. The second highest ranking date? 17 A. That was November 7th. There were 77 contacts on that day 18 and it was election day. 19 Q. And the third ranking day, sir? 20 A. That was September 12th, there were 55 contacts on that day 21 and that was primary day. 22 Q. And just take us through 4 through 7. 23 A. The fourth highest number of contacts on any single day 24 occurred on October 6th when there were 52 contacts, followed 25 by December 9th, which ranked fifth, and that was 51 contacts SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1870 C35UANN5 Enright - direct 1 followed by number 6 which was June 6 with 47 contacts and, 2 last, June 15, 2006 with 46 contacts. 3 Q. In the bottom left of the chart, what does it say there, 4 sir? 5 A. It says. Based on Government Exhibit 1515. 6 Q. Again, that is your master chart? 7 A. That's correct. That's the 95-page list. 8 MR. HALPERIN: Thank you, Mr. Turk. 9 Could we have 1517, please. Let's start with the top 10 half of the page. Mr. Turk, the smaller chart, let's just 11 maximize that. 12 Q. Mr. Enright, what is the title of this chart, this is 13 Government Exhibit 1517? 14 A. 2006 monthly totals for Annabi and Jereis phone contacts. 15 Q. The next line? 16 A. 2006 monthly contacts, Annabi Jereis. 17 Q. So this is just what it says it is, it has just broken the 18 contacts down by month as opposed to day? 19 A. That's correct. 20 MR. HALPERIN: Let's blow back up to the bigger chart, 21 Mr. Turk. And let's blow-up the bottom half of the chart. 22 Q. And the title of this bottom chart, sir? 23 A. "2006 Monthly Contacts, Annabi Jereis." 24 Q. Take us through just month by month. 25 A. In January there were a total of 250 contacts between the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1871 C35UANN5 Enright - direct 1 Annabi phones and the Jereis phones. In February there were 2 169; March, 142; April, 132; May, 50. In June there were 623 3 contacts between their phones. In July there was 136. In 4 August there was 81. In September there were 302, in October 5 there were 340. There were 448 contacts in November and in 6 December there were 286 contacts between their phones. 7 Q. So which month had the highest number of contacts between 8 the Annabi and Jereis phone? 9 A. That was June of 2006. 10 Q. With 623? 11 A. 623 contacts in all. 12 MR. HALPERIN: Thank you, Mr. Turk. 13 Can we please go to 1522. Let's see if we can zoom 14 and grab the whole chart. That's perfect. Thank you. 15 Q. The title here, sir? 16 A. "Annabi Jereis Contacts in June 2006." 17 Q. The next line, sir? 18 A. "Annabi Jereis June 2006 Contacts By Day. 19 Q. What have you blotted here other than this chart? 20 A. I blotted each day's total contacts between the Annabi and 21 Jereis phones. 22 Q. For the month of June? 23 A. For the month of June only. In other words, this is a 24 blow-up of a month from the earlier exhibit which showed the 25 entire year, day by day. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1872 C35UANN5 Enright - direct 1 Q. And the highest day is what? 2 A. 81 contacts, and that was on June 9th. 3 MR. HALPERIN: Thank you, Mr. Turk. 4 1518, please. 5 Mr. Turk, let's blow-up the top half first. 6 Q. What is the title here, Mr. Enright? 7 A. "2006 Contacts for Annabi and Jereis by Day of the Week." 8 Q. Just walk us through what you have done here? 9 A. Well, the asterisks refers to the fact that I eliminated 10 the work phones for Annabi on this because I was looking at any 11 differential between the weekend phones, between the contacts 12 for weekdays there would not be any contacts for weekends and, 13 of course, for work phones there wouldn't be any contacts on 14 the weekend so I eliminated them. 15 So the total for this is, for the total number of 16 contacts then for the year is a little less than the total 17 number of contacts there would be otherwise because I was 18 missing work phones. But what I did was, I then totaled up the 19 day of the week for each month and totaled them across and came 20 up with a percentage of distribution for each day of the week 21 that the phones were in contact with each other. 22 Q. So down the left side you have day of the week? 23 A. That's correct. 24 Q. And across the top going from left to right we have what? 25 A. That's the month of 2006 in question. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1873 C35UANN5 Enright - direct 1 Q. Total for the year on this chart is how many contacts? 2 A. 2,693. 3 MR. HALPERIN: The bottom half of the chart. 4 Q. What do we have here, Mr. Enright? 5 A. This is a pictorial representation of the distribution of 6 the contacts between the Annabi and Jereis phones, again, 7 eliminating the Annabi work phones for each month so that the 8 red represents the contacts that occurred on weekends and the 9 blue represents contacts for each month that occurred on 10 weekdays. 11 Q. It looks like, on this one, starting from the bottom on the 12 left side, we go the months, it looks like we have, you have 13 done the months by reverse order? 14 A. That's correct. January at the bottom, December at the 15 top. 16 Q. Which month had the most weekday contact? 17 A. That was June of 2006. 18 Q. And the second most weekday contact? 19 A. That was November of 2006. 20 MR. HALPERIN: Mr. Turk, 1523, please. And why don't 21 we highlight the top half of the page. That's great. 22 Q. And, sir, what do we have here? 23 A. This is a listing of the calling activity on June 15, 2006 24 for the four subjects that I was asked to look at. 25 Q. Let me direct your attention down to the call at 12:40 p.m. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1874 C35UANN5 Enright - direct 1 Do you see that, Mr. Enright? 2 A. Yes, I do. 3 Q. Who was that call from and to? 4 A. That call occurred from the Annabi cell phone to Dee 5 Barbato's cell phone, and it occurred at 12:40 p.m., 40 minutes 6 after noon, and it was an 11-minute call. 7 MR. HALPERIN: Mr. Turk, can we have 1525? 8 Q. What does this chart indicate, Mr. Enright? 9 A. This shows just the contacts that occurred between two 10 phones, the Jereis cell phone and the John Murtagh phone which 11 is also a cell phone. 12 Q. Do you know who John Murtagh is? 13 A. I believe he is a city council member in Yonkers. 14 Q. But you have no independent knowledge, that is just 15 something you learned from the case agents? 16 A. Yes, that's correct. 17 Q. Just take us through line 1, what does line 1 indicate, 18 sir? 19 A. Line 1 indicates that the Jereis phone placed a call to the 20 Murtagh phone which is 914-391-3740 on July 11, 2006 at 13:11 21 hours. That is 1:11 p.m. and that lasted two minutes. 22 Q. OK, then there are several other contacts between those two 23 individuals? 24 A. That's correct. 25 Q. Again, in the context of your work, you don't know what was SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1875 C35UANN5 Enright - direct 1 happening in the investigation on July 11th, correct? 2 A. I have no idea. 3 MR. HALPERIN: Thank you, Mr. Turk. Can we go to 4 1528, please. Let's just maximize the whole thing, if we can, 5 as tightly as we can. 6 What is the top, title of this document, sir? This is 7 Government Exhibit 1528. 8 A. The title is "Jereis FCR Contacts." 9 Q. FCR refers to who? 10 A. Forest City Ratner. 11 Q. How have you broken it down, the top half of the page? 12 A. I broke it down by month showing a total number of contacts 13 that the Jereis phones had with individuals at Forest City 14 Ratner. 15 Q. In January how many contacts were there? 16 A. There were none. 17 Q. February? 18 A. None. 19 Q. March? 20 A. None. 21 Q. April? 22 A. None. 23 Q. May? 24 A. None. 25 Q. June? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1876 C35UANN5 Enright - direct 1 A. 56. 2 Q. July? 3 A. Five. 4 Q. August? 5 A. One. 6 Q. September? 7 A. None. 8 Q. October. 9 A. None. 10 Q. November? 11 A. Two. 12 Q. December? 13 A. Four. 14 Q. In 2007, how many contacts total? 15 A. There were no contacts that were found. 16 Q. And the bottom half is just a pictorial demonstration of 17 that data? 18 A. That's correct, the blue line represents 2006 contacts 19 between Jereis and the Forest City Ratner phones. And the 20 rust-colored straight line at the bottom represents the 2007 21 contacts which were all zero for every month. 22 MR. HALPERIN: Mr. Turk, 1529, please. Let's 23 highlight the top third of the page. 24 Q. What is the title, Mr. Enright? 25 A. "Annabi and Jereis 2006 phone contacts with Forest City SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1877 C35UANN5 Enright - direct 1 Ratner, month by month." 2 Q. The first column on the left is month? 3 A. That's the month of the year in 2006. 4 Q. We already saw the next column on the that previous chart, 5 is that right? 6 A. That's correct. 7 Q. What is the column after "FCR Jereis"? What is the third 8 column from the left? 9 A. That is the FCR Annabi contacts. 10 Q. How many contacts were there between Forest City Ratner's 11 phones and Sandy Annabi in January? 12 A. None. 13 Q. February? 14 A. Zero. 15 Q. March? 16 A. Zero. 17 Q. April? 18 A. Zero. 19 Q. May? 20 A. Zero. 21 Q. June? 22 A. 17. 23 Q. July. 24 A. Two. 25 Q. August through October? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1878 C35UANN5 Enright - direct 1 A. Zero. 2 Q. And November? 3 A. One. 4 Q. December? 5 A. One. 6 Q. And what is the total column there, sir? 7 A. The total just adds up the first two columns for each row 8 for the Jereis and Annabi phones and contact with the FCR 9 phones. 10 Q. How many total contacts were there between the Jereis and 11 Annabi phones and the FCR phone in 2006? 12 A. There were a total of 89 contacts. 13 Q. If you add up June and July, how many is that? 14 A. 80. 15 MR. HALPERIN: Mr. Turk, the bottom half, please. 16 Q. Again, is this essentially just a pictorial depiction of 17 what you just showed us? 18 A. That's correct. The top graph shows the Forest City Ratner 19 and Jereis phone contacts in blue. And the rust colored is for 20 the FCR Annabi contacts. Down below he second chart shows the 21 total for both of their phones added in together. 22 Q. Thank you. 23 MR. HALPERIN: Mr. Turk, can we have 1532, please. 24 Q. What is the title on Government Exhibit 1532? 25 A. "July 23, 2006 Phone Activity." SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1879 C35UANN5 Enright - direct 1 Q. Just briefly take us through, going from top to bottom, who 2 the calls were between. You don't have to give us the date or 3 time. 4 A. The first call is from the Jereis cell to the Annabi cell. 5 Q. Is that a text or a call? 6 A. That is a text message. 7 Q. Is that true also for the next four items? 8 A. That's correct. 9 Q. What is the next contact, the second row? 10 A. It is Jereis cell to Annabi cell, a text message. 11 Q. The next one? 12 A. Jereis cell to the Annabi cell, another text message. 13 Q. The next two. 14 A. Those are text messages from the Annabi cell to the Jereis 15 cell. 16 Q. And the last two? 17 A. Those are phone contacts between a cell phone belonging to 18 Bruce Bender of Forest City Ratner and Sandy Annabi. 19 Q. Thank you. 20 MR. HALPERIN: Can we have 1521, Mr. Turk. Let's 21 highlight the top half. Just up a little bit. Thank you very 22 much. 23 Q. What is this chart, Mr. Enright? 24 A. It is Jereis and Mangone 2006 phone contacts by month for 25 cell and associated phones. The associated phones are the work SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1880 C35UANN5 Enright - direct 1 phones for Mr. Mangone and any contact that might have occurred 2 from the Jereis cell or home phones to either -- to any of the 3 work phones for Mr. Mangone. 4 Q. Looking at the last column, what does that indicate? 5 A. That totals up both the cell-to-cell, direct cell-to-cell 6 contacts between Jereis and Mangone, as well as contacts that 7 might have occurred from the work phone to the cell phone. 8 Q. What month in 2006 had the highest number of contacts 9 between Jereis and Mangone? 10 A. That would be July of 2006 with 71 contacts. 11 Q. And what was the second most? 12 A. The second most occurred in June with 48 contacts. 13 MR. HALPERIN: Mr. Turk, can we have the bottom 14 two-thirds of that chart, please. 15 Q. What do we have here, Mr. Enright? 16 A. This is just a pictorial representation of the totals that 17 appeared above showing the total number of contacts between the 18 Mangone and Jereis cells in 2006. 19 MR. HALPERIN: Thank you, Mr. Turk. 20 Your Honor, I have about 10 minutes left. I didn't 21 know when the Court wanted to break. 22 THE COURT: I can go for 10. We are going to go for 23 another 5 or 10 minutes and then we are going to break for the 24 day. We have to bring the witness back for cross. 25 MR. HALPERIN: Mr. Turk, can we have 1531. Let's SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1881 C35UANN5 Enright - direct 1 highlight the top half of the page. Right there. 2 BY MR. HALPERIN: 3 Q. What is this chart, Mr. Enright? 4 A. June 20th to 21st, 2006 phone activity. 5 Q. And why don't you take us through. Let's start with the 6 first line, going down the page. What is the contact there, 7 between which phones? 8 A. I'm sorry. Did you want me to tell you what the first row 9 represents? 10 Q. Yeah. I'm sorry. I wasn't clear. The first row, the 11 contact between whom? 12 A. It was contact between the Jereis cell and the Annabi cell 13 on June 20th, three minutes, in this case, phone call. 14 Q. At what time? 15 A. At 1:52 p.m., 15:52 hours. 16 Q. What was the next contact? 17 A. The next contact was a text message from the Annabi cell to 18 the Jereis cell which occurred at 1:55 p.m. on June 20th. 19 Q. And the next one, row 3? 20 A. The Jereis cell called the Annabi phone at the Yonkers City 21 Council at 13:56 on June 20th and there was an 11-minute 22 duration for that call. 23 Q. The next row? 24 A. The Jereis cell called the Annabi cell on June 20th at 2:37 25 p.m., and that was a two minute call. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1882 C35UANN5 Enright - direct 1 Q. Let's skip three ahead and the one starting "Jereis cell," 2 what was that contact? 3 A. That was a text message from the Jereis cell to the Annabi 4 cell at 2:41 p.m. 5 Q. And the next contact? 6 A. That was a call from the Mangone cell to the Milio cell at 7 2:57 p.m., and that was a 19-second call. 8 Q. And the next contact? 9 A. That was a call from the Milio cell to the Mangone cell at 10 4:24 p.m., and that was a 12-second call. 11 Q. And the next one, sir? 12 A. That was a call from the Milio cell again to the Mangone 13 cell at 4:24. This was 20 seconds later and the length of the 14 call was 37 seconds. 15 Q. What were the final three contacts on June 20th? 16 A. There were two texts from Jereis to Annabi, and then a call 17 from the Jereis cell to the Annabi cell. 18 MR. HALPERIN: Mr. Turk, does the bottom part of that 19 and show underneath the line, please. 20 Q. What date are all of these contacts? 21 A. Now we have moved ahead to June 21st, the next day. 22 Q. Generally, who are these contacts between? We are not 23 going to go line by line on this one. Who are these contacts 24 between? 25 A. Most of them are between Jereis phones and Annabi phones. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1883 C35UANN5 Enright - direct 1 Q. Let me direct your attention to the eighth line from the 2 bottom, the one that starts "Annabi cell," do you see that? 3 A. Yes, I do. 4 Q. What is that item? 5 A. That's a phone call from the Annabi cell to the Jereis cell 6 at 5:02 p.m. on the 21st of June, and that was a five-minute 7 call. 8 Q. And what is the next contact? 9 A. That's a call from the Jereis cell to a jewelry store in 10 Yonkers called T & R Jewelers, and that occurred at 5:07 p.m., 11 and that was a one-minute call. 12 Q. Then the next contact? 13 A. That was a call a minute later from the Jereis cell to the 14 Annabi cell. 15 Q. How long did that last? 16 A. That was one minute. 17 Q. And that was at 5:08 p.m.? 18 A. That's correct. 19 Q. A minute after the previous one? 20 A. That's correct. 21 Q. The next one, sir? 22 A. That occurred at 5:52 p.m., and that was a call from the 23 Jereis cell to the Mangone cell and that lasted one minute. 24 Q. The next item? 25 A. That was a call from the Jereis cell to the Annabi cell. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1884 C35UANN5 Enright - direct 1 That occurred at 6:24 p.m. and actually that wasn't a call, 2 that was a text message. 3 Q. And the next one, sir? 4 A. That was a call from the Milio cell to the Mangone cell and 5 that occurred at 9:12 p.m., and it was a one-minute call. 6 Q. And the next one, the second to last on the page? 7 A. That was the Mangone cell called the Milio cell at 9:13 8 p.m., and that was a one-minute call. 9 Q. And the last one? 10 A. That was a call from the Jereis cell -- actually that was a 11 text from the Jereis cell to the Annabi cell and that was at 12 10:23 p.m. 13 MR. HALPERIN: Thank you, Mr. Turk. 14 Judge, I may have underestimated -- 15 THE COURT: If you have underestimated, then we will 16 quit now. 17 So, folks, I will see you tomorrow morning at 9:30. 18 Don't discuss the case. Keep an open mind. 19 (Proceedings adjourned until 9:30 a.m., March 6, 2012) 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1885 1 INDEX OF EXAMINATION 2 Examination of: Page 3 ANTHONY MANGONE 4 Cross By Mr. Siano ...... 1716 5 Cross By Mr. Aronwald ...... 1768 6 Redirect By Mr. Carbone ...... 1832 7 Recross By Mr. Aronwald ...... 1852 8 JOSEPH ENRIGHT 9 Direct By Mr. Halperin ...... 1857 10 GOVERNMENT EXHIBITS 11 Exhibit No. Received 12 2 ...... 1856 13 1502, 1502-A, 1508 and 1509 ...... 1856 14 1515 through 1532 ...... 1865 15 DEFENDANT EXHIBITS 16 Exhibit No. Received 17 52, 53, 54, 55 and 55A ...... 1716 18 56 ...... 1717 19 57 ...... 1717 20 58 ...... 1717 21 59 ...... 1717 22 60 ...... 1718 23 61 ...... 1718 24 62 ...... 1718 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1886 C36Qann1 Trial 1 UNITED STATES DISTRICT COURT 1 SOUTHERN DISTRICT OF NEW YORK 2 ------x 2 3 UNITED STATES OF AMERICA, 3 4 v. 10 CR 007 (CM) 4 5 SANDY ANNABI and ZEHY JEREIS, 5 6 Defendants. 6 7 ------x 7 8 New York, N.Y. 8 March 6, 2012 9 10:00 A.M. 9 10 10 11 11 Before: 12 12 HON. COLLEEN MCMAHON 13 13 District Judge 14 14 15 APPEARANCES 15 16 PREET BHARARA 16 United States Attorney for the 17 Southern District of New York 17 JASON P.W. HALPERIN 18 PERRY A. CARBONE 18 Assistant United States Attorneys 19 19 WILLIAM I. ARONWALD 20 Attorney for Defendant ANNABI 20 21 ANTHONY J. SIANO 21 JEANNIE GALLEGO 22 Attorneys for Defendant JEREIS 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1887 C36Qann1 Trial 1 (In open court; jury not present) 2 THE DEPUTY CLERK: Case on trial continued. 3 Government and defendants are present. Jurors are not present. 4 THE COURT: Good morning. I can't see any of you. 5 THE DEPUTY CLERK: Someone had something. 6 MR. HALPERIN: Yes, Judge. In terms of timing, I 7 wanted to update the government's rough assessment of where we 8 are. Unsurprisingly, in this courtroom we are moving a little 9 faster than we anticipated. So I think that -- 10 THE COURT: Aren't you used to that yet? 11 MR. HALPERIN: I am, but you still never know. 12 Our best assessment at this point -- I think I said 13 last week that we might rest next Tuesday. I think our best 14 assessment is that the government will probably rest either 15 this Thursday or maybe this coming Monday. 16 THE COURT: Well, Thursday will be a short day in any 17 event. 18 MR. HALPERIN: That's a 3:00 day. 19 THE COURT: It's going to be earlier than 3:00. 20 MR. HALPERIN: Judge, there was one other issue. 21 THE COURT: Like 2:00. 22 MR. HALPERIN: There was one other issue we wanted to 23 bring to the Court's attention, which was that yesterday after 24 court, Mr. Aronwald appeared on camera and gave an interview to 25 News 12 that aired last evening. He was talking about SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1888 C36Qann1 Trial 1 Mr. Mangone, and Mr. Aronwald said on camera: "We are on our 2 way to hopefully convincing this jury that he is not at all 3 credible for anything." 4 Obviously, this is a direct violation of Local 5 Criminal Rule 23.1. It's not the first time it's happened in 6 this case, but it is now different because we are obviously 7 during trial, and we'd simply ask the Court to direct all 8 attorneys and parties right now that no attorney or party can 9 give any interviews to any media outlet until the end of the 10 trial. 11 I don't think that's an unreasonable request 12 particularly in light of what's happened. 13 MR. ARONWALD: Your Honor, I didn't see the News 12 14 piece, but if that's all they showed, it was taken out of 15 context. Basically, what I did was -- 16 THE COURT: Even so, no more interviews, people. We 17 are at a critical point. We are at a critical juncture, and 18 while I trust the jurors, you never know what they might see. 19 Please. Please, can we not compromise this now. 20 Mr. Siano laughed. You think I want to do this again? 21 (Continued on next page) 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1889 C36Qann1 Trial 1 (Jury present) 2 JOSEPH ENRIGHT, resumed. 3 called as a witness by the Government, 4 having been previously sworn, testified further as 5 follows: 6 DIRECT EXAMINATION CONTINUED 7 BY MR. HALPERIN: 8 THE COURT: Good morning. My bad. I'm sorry. I went 9 to the eye doctor this morning, and as is always the case with 10 doctors' appointments, even when you make them at 8:15, they 11 take longer than you think they are going to. I can't see any 12 of you. Please don't misbehave. 13 Let me just bring you up to date on where we are 14 because the government has very kindly brought me up to date on 15 where it is. 16 We have a full day today. We have a full day 17 tomorrow. Thursday we are going to go from 9:30 until 2:00. 18 The government believes that it will either rest its case at 19 the end of this week or, more likely, on Monday of next week, 20 which means they are some days ahead of where they thought they 21 would be, which means we're cooking. So let's keep on cooking. 22 We have a witness on the stand. Sir, you are still 23 under oath. 24 Mr. Halperin, do you want to finish? 25 MR. HALPERIN: Thank you, your Honor. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1890 C36Qann1 Enright - Direct 1 BY MR. HALPERIN: 2 Q. Good morning, Mr. Enright. 3 A. Good morning. 4 Q. Mr. Turk, I think we just finished looking at Government 5 Exhibit 1531. Can we please have 1524? 6 Mr. Enright, what's the title of Government Exhibit 7 1524? 8 A. June 23, 2006 calls among Annabi, Jereis and T&R Jewelers. 9 Q. So these are all calls on June 23 as the chart says, is 10 that right? 11 A. That's correct, they are in chronological order. 12 Q. And the first call of the day? 13 A. That was at 12:15 p.m. 14 Q. From whom? 15 A. It was from T&R Jewelers to the Jereis cell phone. 16 Q. How long did that call last? 17 A. That was four minutes. 18 Q. I'm sorry, you said it was at 12:15 p.m.? 19 A. That's correct. 20 Q. The next call? 21 A. That was from Jereis to -- from the Jereis phone to 22 Annabi's phone and -- 23 Q. What time? 24 A. That was at 12:21; that was a one minute call. 25 Q. Then the next? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1891 C36Qann1 Enright - Direct 1 A. That was also -- 2 Q. Let me just ask you about the next eight, are all contacts 3 between whom? 4 A. Between Jereis and Annabi. 5 Q. And then the one after that, who was that? 6 A. That was from Jereis's phone to T&R Jewelers' phone. 7 Q. What time of day? 8 A. That was 2:40 p.m. 9 Q. And the duration? 10 A. That was four minutes. 11 Q. Who did Jereis call next? 12 A. The Jereis phone called the Annabi phone at 3:03 p.m.; that 13 was a three minute call. 14 Q. The next contact? 15 A. Jereis to Annabi again at 3:05 p.m., and that was a one 16 minute call. 17 Q. And the next contact? 18 A. Jereis to T&R Jewelers phone at 3:06 p.m., and that was a 19 one minute call. 20 Q. And the next contact? 21 A. Jereis to Annabi at 3:38, and that was a text message. 22 Q. And the next contact? 23 A. That was from Annabi to T&R Jewelers. That was at 24 3:54 p.m., and it was a five minute call. Followed by another 25 call from Annabi to the T&R Jewelers phone at 3:59 p.m.; that SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1892 C36Qann1 Enright - Direct 1 was a one minute call. 2 Q. And the next contact? 3 A. T&R Jewelers called Jereis at 4:01 p.m.; that was a four 4 minute call. Annabi then called T&R Jewelers at 4:09 p.m, and 5 that was a four minute call. 6 Q. And the next contact? 7 A. T&R Jewelers called Annabi at 4:32 p.m., and that was a two 8 minute call. 9 Q. And the next two contacts were what? 10 A. They were both from Jereis to Annabi at 5:04 p.m. for one 11 minute, and then at 5:39 a text message. 12 Q. Again, just as a reminder, you have no idea the substance. 13 You never got the substance of any of these calls; you just 14 know of the facts of calls or texts, is that right? 15 A. That's correct. 16 Q. Thank you, Mr. Turk. Let's go to Government Exhibit 1530, 17 please. 18 What is the title of this chart Government Exhibit 19 1530? 20 A. This chart is mislabeled. It says July 10, 2010 phone 21 contacts. It should say July 10, 2006 phone contacts. 22 Q. OK. So this is the year 2006? 23 A. Yes, it is. 24 Q. OK. Did you look at contacts in 2010? 25 A. No, I didn't. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1893 C36Qann1 Enright - Direct 1 Q. So that was just a labeling mistake there? 2 A. That's a typo. My bad. 3 Q. Let's start with the first line. What's the time of the 4 first contact? 5 A. That was 2:14 p.m., and that was a call from Jereis to 6 Mangone, and it was a two minute call. 7 Q. Let's go to the third line, the third row. 8 A. That was a call at 3:42 p.m. from Mangone's phone to the 9 Jereis phone, and that was a one minute call. 10 Q. And the next contact? 11 A. 3:49 p.m., the Milio cell phone calls Mangone's phone, and 12 that was a one minute, three second call. 13 Q. The next contact? 14 A. 3:53 p.m. Mangone places a call or Mangone's phone places a 15 call to the Milio cell phone, and that lasted 4 minutes and 33 16 seconds. 17 Q. And the next contact? 18 A. 3:57 p.m. Annabi places a call to the Jereis phone, and 19 that was a one minute call. 20 Q. OK, next? 21 A. 4:01 p.m., the Jereis phone calls the Annabi phone, and 22 that was a four minute call. 23 Q. Next? 24 A. 4:06 p.m. Mangone places a call to the Milio cell phone, 25 and that was an eight minute, eleven second call. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1894 C36Qann1 Enright - Direct 1 Q. Let's skip down three lines. What happened at 4:21? 2 A. 4:21 p.m. Milio places a five second call to the Mangone 3 cell phone. 4 Q. And the next one two, three, four contacts were all between 5 who? 6 A. Those are phone calls back and forth from Milio to Mangone, 7 Mangone to Milio. 8 Q. Let's pause here, Mr. Turk. Let's take this down, please, 9 and please display Government Exhibit 700 in evidence received 10 by the Court. 11 Mr. Enright, have you ever seen this document before? 12 A. No. 13 Q. The Court has received it in evidence. What does the from 14 line say? 15 A. It says: From Anthony Mangone followed by an email 16 address. 17 Q. Who is it sent to? 18 A. Franco Milio. 19 Q. Subject? 20 A. Longfellow. 21 Q. What's the date and time? 22 A. Monday, July 10, 2006, 4:20 p.m. 23 Q. Mr. Turk, can we go back again to 1530? And if you could 24 highlight, Mr. Turk, the entry at 4:20 p.m. and unhighlight the 25 other one first if you can, please. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1895 C36Qann1 Enright - Direct 1 What does your chart indicate about 4:20 p.m., who 2 called who? 3 A. Mangone calls Jereis, and it's a four minute call. 4 Q. That was the same time as the email you just saw? 5 A. That's correct. 6 Q. Mr. Turk, can we go back up to the full picture? Let's 7 just now highlight, I guess, the bottom -- that's fine. 8 Directing your attention to 4:43 p.m., what's the 9 contact there? 10 A. That's a call from Mangone phone to the Jereis phone for 11 one minute. 12 Q. What are the next two contacts? 13 A. From the Mangone phone to the Annabi phone. 14 Q. For how long? 15 A. Two minutes followed by one minute. 16 Q. That's at what time? 17 A. 4:44 p.m. and 4:46 p.m. 18 Q. What's the 4:52 contact? 19 A. It's a call from the Mangone phone to the Jereis phone and 20 that's a one minute call. 21 Q. Generally the rest of the page are contacts between which 22 people? 23 A. Milio, Mangone, Jereis, Annabi, the four subjects. 24 Q. OK. Thank you, Mr. Turk. Let's go to 1526, please. 25 What is the title of this chart, sir? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1896 C36Qann1 Enright - Direct 1 A. July 13, 2006 phone activity. 2 Q. Take us through the chart. This is a shorter chart. Take 3 us through line by line, please. 4 A. Sure. The Mangone phone to the Jereis phone, all these are 5 July 13, so I will skip the date. At 11:14 for two minutes 6 followed by a text message from the Jereis cell phone to the 7 Annabi sell phone at 1:25 p.m., followed by a call from Annabi 8 to Jereis at 3:20 p.m. for one minute, followed by two text 9 messages from Jereis to the Annabi cell phone. 10 Q. What time of those two texts? 11 A. 3:24 p.m. and 4:46 p.m. 12 Q. What happens after the 4:46 text? 13 A. There's a call from the Mangone phone to the Jereis phone 14 at 4:54 p.m. for two minutes. 15 Q. Next? 16 A. Jereis calls Mangone at 5:32 p.m. for one minute, and the 17 next three are contacts between the Jereis phone and the Annabi 18 phone -- 19 Q. Starting with the first of those three contacts, Jereis and 20 Annabi, what's the time of that? 21 A. That's at 5:35 p.m., it's a six minute call, followed by a 22 seven minute call at 5:42 p.m., followed by a text message at 23 6:46 p.m. 24 Q. Mr. Turk, can you go to 1527, which is our final chart. 25 Let's highlight the top half of the page, please. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1897 C36Qann1 Enright - Direct 1 What's the title, sir? 2 A. Phone activity 9/26/06 and 9/27/06. 3 Q. What's the first entry here? 4 A. That's a call from the Annabi phone to the Jereis phone at 5 12:23 p.m. for two minutes. 6 Q. And the next four -- actually, the next five, six, seven -- 7 the next seven contacts are all between whom? 8 A. Between the Annabi and Jereis phones. 9 Q. What time of day are those contacts? 10 A. 1:42 p.m. through 5:53 p.m. 11 Q. Then what's the next one starting Mangone? 12 A. That's a call from the Mangone phone to the Jereis phone at 13 8:42 p.m. for one minute, followed by two more calls from the 14 Mangone phone to the Jereis phone at 8:43 p.m. for one minute, 15 and 8:46 p.m. for another minute. 16 Q. And the next two contacts are what? 17 A. Those are calls from the Jereis phone to the Mangone phone 18 at 9:06 p.m. for one minute, and then again from the Jereis 19 phone to the Mangone phone at 9:08 p.m. for one minute. 20 Q. And the next contact after the Jereis and Mangone contact? 21 A. That's a call from Mangone's cell to the Milio cell. That 22 was at 9:54 p.m. for one minute. 23 Q. Mr. Turk, can we go back out, do the bottom half of the 24 page. Thank you, Mr. Turk. 25 OK. The last one we did was 9:54. What's the next SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1898 C36Qann1 Enright - Direct 1 date, now the next entry? 2 A. September 27, the next day. 3 Q. So we're back to the first contact. At what time of day on 4 September 27? 5 A. That's 9:48 a.m. It's a call from Annabi to Jereis for one 6 minute. 7 Q. And the next contact is what? 8 A. That's at 9:51 a.m. Contact between -- from the Jereis 9 phone to the Annabi phone for one minute. 10 Q. The next contact? 11 A. From the Annabi phone to the Jereis phone at 10:13 a.m. for 12 six minutes. 13 Q. Let's just focus now on the next one, two, three, four, 14 five, six, seven, eight, nine, the next nine contacts are 15 between which two people? 16 A. Between Mr. Jereis and Ms. Annabi. 17 Q. How many texts are there out of those nine? 18 A. The last contact at 8:05 p.m. is a text. 19 Q. At 5:16 p.m. just tell me what that contact is, please, 20 there? 21 A. That's a call from the Annabi phone to the Jereis phone, 22 and that's an eight minute call. 23 Q. After that text from Jereis to Annabi at 8:05 p.m., what's 24 the next contact? 25 A. That's a call from the Jereis phone to the Mangone phone at SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1899 C36Qann1 Enright - Direct 1 9:01 p.m. for one minute. 2 Q. And the next contact? 3 A. That's a text from the Jereis cell phone to the Annabi cell 4 phone at 10:04 p.m. 5 Q. And the last contact of the day? 6 A. At 10:34 p.m. there's a call from the Mangone phone to the 7 Jereis phone that lasted two minutes. 8 MR. HALPERIN: Thank you, Mr. Turk. 9 Thank you, sir. Nothing further, Judge. 10 THE COURT: Mr. Aronwald. 11 MR. ARONWALD: Good morning, your Honor. I'm over 12 here. 13 CROSS-EXAMINATION 14 BY MR. ARONWALD: 15 THE COURT: It's all a blur. However, you won't know 16 when it subsides. 17 Q. Mr. Enright, I'm going to try to be brief. Just so we're 18 clear, your charts are prepared basically from the telephone 19 company records themselves, correct? 20 A. That's correct. Those are records they keep in the normal 21 course of business. 22 Q. Right. And I think as you indicated on direct examination, 23 your charts simply relate to the fact that there were calls 24 between two numbers, right? 25 A. That's correct. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1900 C36Qann1 Enright - Cross 1 Q. And has nothing at all to do with the content or substance 2 of the discussions that those calls relate to, correct? 3 A. That's correct. 4 Q. You have been doing this for how long? 5 A. For the FBI? 6 Q. Well, yeah. 7 A. For the FBI, I've been doing it for eight years. 8 Q. Had you done similar work analyzing telephone records prior 9 to your employment by the FBI? 10 A. Yes, I did. 11 Q. For how many years? 12 A. 15 years. 13 Q. Now, I see that from these charts a lot of these calls are 14 of one minute duration, is that correct? 15 A. Yes, that's correct. 16 Q. Based upon your experience with respect to cell telephones, 17 for example, isn't there a minimum charge, in other words if a 18 call is made from one number to another number but it's not 19 completed, it's still reflected on the bill as a charge? 20 A. Yes, there's a lot of variation, sir, in the phone company 21 billing practices. Some companies use a one minute default if 22 the conversation is more than one second but less than one 23 minute. 24 Q. Do you know what the default was by the telephone company 25 provider that these charts relate to? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1901 C36Qann1 Enright - Cross 1 A. Yes, I can tell you that. The Milio cell was a Sprint 2 cell, and Sprint records the actual seconds that each call 3 lasts. The rest all round off to the nearest minute. 4 Q. OK. So in taking it a step further, do any of these 5 companies have, for example, a two minute default? 6 A. Again, they round off to the nearest minute. 7 Q. So, for example, if a call was made and it went to 8 voicemail, and a voicemail message was left -- 9 A. Yes. 10 Q. -- that would be reflected on the chart, correct? 11 A. Some bills reflect that; some don't. 12 Q. Do you know whether the telephone company providers that 13 are reflected in these charts, do you know whether or not -- 14 A. At that time -- at that time, no, sir, in 2006. 15 Q. OK. So, in other words, at that time if a telephone call 16 was made from one number to another, and it went to voicemail 17 and the person left a two minute voicemail message, you're 18 saying there would be no charge reflected on the telephone 19 record? 20 A. No. The call would appear. 21 Q. Oh. 22 A. There are certain exceptions to that, sir. 23 Q. But do any of those exceptions apply in this case, if you 24 know, to these charts? 25 A. I can't -- I can't -- I can tell you that T-Mobile, which SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1902 C36Qann1 Enright - Cross 1 was one of the phones in question here, sometimes does not 2 record phone calls that go directly to voicemail. 3 Q. You say sometimes. You don't know whether or not that 4 applied to this case and to the calls that are reflected on 5 these charts, correct? 6 A. That's correct. 7 Q. With respect to the telephone number that was subscribed to 8 by Sandy Annabi, do you recall what company was her provider? 9 A. Yes, sir. She had two cell phones for which records were 10 subpoenaed, and that was T-Mobile. 11 Q. OK. And T-Mobile, what was their default? 12 A. To the nearest minute. 13 Q. To the nearest minute, OK. In fact, with respect to all of 14 the calls that are listed of one minute duration, you don't 15 know whether any of those calls that are reflected on your 16 charts actually reflect conversation that actually took place 17 between the two subscribers, correct? 18 A. That's correct. 19 MR. ARONWALD: May I have one moment, your Honor? 20 THE COURT: Yes. 21 (Pause) 22 MR. ARONWALD: Your Honor, at this time the parties 23 are stipulating that during the period of July 14 of 2006 to 24 August 16 of 2006 Sandy Annabi was out of the country in 25 Jordan; the parties will stipulate to that. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1903 C36Qann1 Enright - Cross 1 MR. HALPERIN: We agree, Judge. 2 MR. SIANO: So stipulated. 3 THE COURT: OK. Thank you. Folks, that fact is 4 proved. No dispute. 5 BY MR. ARONWALD: 6 Q. Now, Mr. Enright, in the course of your chart analysis of 7 telephone calls, did you find any calls at all between Sandy 8 Annabi's cell phones and the telephone number subscribed to by 9 T&R Jewelry Exchange in New Rochelle, New York? 10 A. I'd have to review the charts. 11 Q. Do you have the charts in front of you? 12 A. No, I don't. 13 Q. Mr. Halperin is good enough to hand the charts up to you. 14 MR. HALPERIN: Your Honor, may I approach? 15 THE COURT: Yes. 16 Q. I noticed some of the charts that are in evidence that 17 Mr. Halperin questioned you about are charts relating to 18 telephone calls between the parties, Sandy Annabi and/or Zehy 19 Jereis and T&R Jewelers? 20 A. That's correct. 21 Q. I don't recall whether any of those charts though cover the 22 time period of July 14 of 2006 and August 16 of 2006. So if 23 you would look through them and please tell me whether your 24 analysis found any calls at all between the telephones 25 subscribed to by Sandy Annabi and T&R Jewelers during that time SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1904 C36Qann1 Enright - Cross 1 period. 2 A. No, sir, there weren't. 3 MR. ARONWALD: Thank you very much, Mr. Enright. As I 4 promised, I was brief. No further questions. 5 THE COURT: Mr. Siano. 6 CROSS-EXAMINATION 7 BY MR. SIANO: 8 MR. SIANO: May I proceed, your Honor? 9 THE COURT: Yes. 10 Q. Good morning, Mr. Enright. My name is Anthony Siano. I 11 represent the defendant Zehy Jereis. 12 A. Good morning, Mr. Siano. 13 Q. Mr. Enright, you used the word here on this big chart 1515, 14 the one with all the pages, you used the word duration? 15 A. That's correct. 16 Q. In connection with the cell phones, do the cell phone 17 companies used another word, do they use the word usage? 18 A. Some of them do. 19 Q. Several of the phone companies use the word usage to denote 20 what you're listing on 1515 as duration, isn't that right? 21 A. That's correct. 22 Q. And some of these cell phone companies have the concept of 23 send to end, isn't that right? 24 A. That's correct. 25 Q. In fact, that kind of company bills from the minute you hit SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1905 C36Qann1 Enright - Cross 1 the little green button on a cell phone until you hit the 2 little red button, is that correct? 3 A. That's correct. 4 Q. And some of those cell phone companies are reflected in 5 these documents you have here? 6 A. That's correct. 7 Q. And you made no effort to differentiate by footnote or by 8 notation in any manner, shape or form, which of these are 9 send-to-end calls and which of these are some other 10 permutation, did you? 11 A. No, because they weren't reflected on the bills that I 12 analyzed -- 13 Q. That's right, because cell phone companies try to get as 14 many minutes as fast as they can, isn't that fair to say? 15 A. Again, they round off to the nearest minute. 16 Q. Well, you have a cell phone, don't you, Mr. Enright? 17 A. I sure do. 18 Q. You've had that experience with cell phones, haven't you? 19 A. I sure have. 20 Q. Trying to get you over the limit so they can start charging 21 you by the minute. 22 Are you familiar with the concept called pocket 23 dialing? 24 A. Yes, I am. 25 Q. Pocket dialing is when you leave the phone in your pocket SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1906 C36Qann1 Enright - Cross 1 or a bag and it dials somebody on speed dial? 2 A. That's correct. 3 Q. Usually you end up finding out about it when that person 4 calls you back and asks you have you lost your mind or words to 5 that effect, is that right? Isn't that's correct? 6 A. That's correct, sir. 7 Q. We've all had that experience, isn't that right? 8 A. Yes, we have. 9 Q. Your chart doesn't make any effort to differentiate any of 10 those kinds of phone calls? 11 A. For the 2,800 calls between the two subjects, no. 12 Q. For any of the phone calls anywhere on this chart, there's 13 no effort or attempt to say which are just numbers that get 14 dialed with no connection whatsoever? 15 A. Again, for the 2,800 phone calls between the subjects, no. 16 Q. I want to talk about that word subject. You got subscriber 17 information besides the subpoenas you were kind enough to 18 describe to us on direct, isn't that right? 19 A. That's correct. 20 Q. You were given that subscriber information by other 21 representatives of the government, isn't that correct? 22 A. That's correct. 23 Q. They didn't give you subpoenaed phone records for 24 Mr. Bender or Mr. Cantone or Forest City Ratner, isn't that's 25 correct? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1907 C36Qann1 Enright - Cross 1 A. That's correct. 2 Q. Right. They didn't subpoena those. Did you get any 3 subpoenaed records for the jewelry company? 4 A. No. No, sir. 5 Q. Did you get any subpoenaed records for Dee Barbato? 6 A. No, sir. 7 Q. So, wherever we see the caller being Ms. Barbato or 8 Mr. Murtagh or Forest City Ratner, you're essentially -- these 9 are my words -- back engineering from other records that you 10 had? 11 A. Right, those were contacts with subpoenaed phones. 12 Q. Right. So you take the subpoenaed phones, and you plug in 13 the subscriber information you're given by the government 14 agents? 15 A. That's correct. 16 Q. Now, you went to great lengths on direct -- and I apologize 17 for asking you this -- you don't know a word of what happened 18 in any of these calls, right? 19 A. That's correct. 20 Q. It would be fair to say if I put my head up against this 21 chart, we can't hear a word of what's happening in any of these 22 calls, isn't that correct? 23 A. That's correct. 24 Q. And you say contact unit-to-unit because you don't know 25 who's holding a phone at any given moment? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1908 C36Qann1 Enright - Cross 1 A. That's correct. 2 Q. And also some places in here -- Mr. Turk, if you would be 3 kind enough to put up 1530 again, the little chart with the 4 little typographical error at the top. And if you could use 5 your little magical pointer there at 4:06 p.m. 6 Now, Mr. Enright, that's a phone conversation where 7 the duration has M's and S's, isn't that right? Minutes and 8 seconds? 9 A. That's correct, that derives from the Franco Milio cell 10 phone, which was a Sprint phone, which does delineate the 11 actual length of the call. 12 Q. In other places, however, you're deriving these minutes and 13 seconds from land line records, isn't that correct? 14 A. Some of them are land lines; some of them are cell phones. 15 Q. Right. But in the instances where you have a one minute 16 phone call, it's fair to say it's a minute or less, isn't that 17 right? 18 A. That's correct. 19 Q. Now, can we have 1524, Mr. Turk. 20 Now, this is June 23, right, Mr. Enright? 21 A. That's correct. 22 Q. Anywhere in here do you hear in any of the text messages or 23 otherwise anybody singing happy birthday -- 24 MR. HALPERIN: Objection. 25 Q. -- to Ms. Annabi? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1909 C36Qann1 Enright - Cross 1 MR. HALPERIN: Objection. 2 THE COURT: Ground? 3 MR. HALPERIN: Argumentative. 4 THE COURT: Overruled. 5 A. The word birthday does not appear. 6 Q. Nobody told you whether or not 6/23 was actually 7 Ms. Annabi's birthday, did they? 8 A. No. 9 Q. So your charts's only as good as the information you are 10 given? 11 A. Right. I wasn't -- I wasn't given a context for this, sir. 12 I was just asked to analyze the phones. 13 Q. That's exactly my point; they didn't give you records from 14 2005, did they? 15 A. Yes, they did. 16 Q. Did you make a chart for those? 17 A. No, I was asked just to concentrate on 2006. 18 Q. So you don't have a comparison for us between the activity 19 in the prior year and this activity? 20 A. No, I don't. 21 Q. Did they give you records for 2007? 22 A. Yes, sir. 23 Q. Did you make a chart for us in those years? 24 A. No, sir. 25 MR. SIANO: Thank you. No further questions. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1910 C36Qann1 Enright - Cross 1 MR. HALPERIN: Very briefly, your Honor. 2 THE COURT: Yes. 3 REDIRECT EXAMINATION 4 BY MR. HALPERIN: 5 Q. Mr. Enright, counsel asked about calls between Sandy Annabi 6 and T&R Jewelers, do you recall that? 7 A. Yes, sir. 8 Q. Mr. Turk, can we have 1524 please, displayed. Let's just 9 maximize the bottom third of that chart. Right there is great. 10 Does this chart reflect any calls between Ms. Annabi 11 and T&R Jewelers? 12 A. Yes, it does, it reflects three calls. 13 Q. Which is the first, what's the duration of that and the 14 time? 15 A. Five minutes at 3:54 p.m., followed by one minute at 16 3:59 p.m., followed by four minute call at 4:09 p.m. -- I'm 17 sorry, yes, that's four -- well, wait a second, 4:09 p.m., 18 that's correct. 19 Q. What's the one at 4:32 p.m.? 20 A. 4:32 p.m. is a two minute call. 21 Q. Between whom? 22 A. That's from T&R Jewelers to Ms. Annabi's phone. 23 Q. What was the date of this chart? 24 A. June 23. 25 Q. OK. Counsel asked about calls between the time Ms. Annabi SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1911 C36Qann1 Enright - Redirect 1 was out of the country July 14 to August 16. Do you recall 2 those questions? 3 A. Yes, I do. 4 Q. What information, if any, did you analyze about calls other 5 than these seven sets of data that you talked about earlier? 6 A. I'm not sure I understand the question. 7 Q. In other words, if someone was using a land line from 8 Jordan or some type of prepaid phone call, would you have had 9 those phone records? 10 A. No. Those would not be -- those would not be found in 11 these records. 12 Q. Mr. Turk, let's go to Government Exhibit 1515. I'm going 13 to hand you page 53. This is received in evidence. I will ask 14 you to put this on the Elmo. If you can blow up -- it's a 15 little hard to see. I know we can't blow it up that well. 16 Right there is great. And if you can move that to the left. 17 Move the page up. I'd like you to focus on the bottom page of 18 that page, please, Mr. Turk. Right there is great. OK. 19 Mr. Enright, do you see the underline, the handwriting 20 there the underlining? 21 A. Yes, I do, July 20, 2006. 22 Q. Just take us across that line. What is that contact, sir? 23 A. That's a call from a phone at T&R Jewelers to the Annabi 24 cell phone at 4:53 p.m. on July 20, a one minute call. 25 MR. HALPERIN: Thank you, Mr. Turk. Nothing further, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1912 C36Qann1 Enright - Redirect 1 Judge. 2 MR. ARONWALD: Could we leave that up, please, 3 Mr. Turk. 4 THE COURT: Sure. 5 RECROSS EXAMINATION 6 BY MR. ARONWALD: 7 Q. Could you highlight that one conversation that Mr. Halperin 8 just alluded to, the call from T&R Jewelers to Sandy Annabi's 9 cell phone? 10 MR. CARBONE: You can't highlight on that. 11 MR. ARONWALD: You can't highlight? OK. 12 Q. So this was a call from T&R Jewelers to Sandy Annabi's cell 13 phone? 14 A. That's correct, sir. 15 Q. That was on July 20 of 2006, correct? 16 A. That's correct. 17 Q. And 16:53 means 4:53 in the afternoon? 18 A. That's correct. 19 Q. And that call was of one minute duration according to your 20 chart? 21 A. That's correct. 22 Q. I think you've already testified that that simply means 23 that it could be rounded off to one minute by the cell phone 24 provider, correct? 25 A. That's correct. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1913 C36Qann1 Enright - Recross 1 Q. There's no way of knowing whether that call actually was 2 completed? 3 A. That's correct. 4 Q. OK. But, more importantly, your chart does not reflect any 5 telephone calls from Sandy Annabi's cell phone to T&R Jewelers 6 during the period July 15, 2006 to August 16, 2006, isn't that 7 correct? 8 A. That's correct, sir. 9 MR. ARONWALD: No further questions. Thank you. 10 THE COURT: Mr. Siano. 11 MR. SIANO: No, your Honor. Thank you. 12 MR. HALPERIN: Nothing further. 13 THE COURT: Thank you, sir. You may step down. 14 (Witness excused) 15 THE COURT: Call your next witness. 16 MR. CARBONE: The government calls Joseph Jenik. 17 JOSEPH JENIK, 18 called as a witness by the Government, 19 having been duly sworn, testified as follows: 20 DIRECT EXAMINATION 21 BY MR. CARBONE: 22 THE DEPUTY CLERK: Tell us your full name. 23 THE WITNESS: Joseph Jenik. 24 THE DEPUTY CLERK: Spell that. 25 THE WITNESS: Joseph, J-O-S-E-P-H. Jenik, J-E-N-I-K. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1914 C36Qann1 Jenik - Direct 1 THE COURT: You may inquire. 2 MR. CARBONE: Thank you, your Honor. 3 Q. Good morning, Mr. Jenik. 4 A. Good morning. 5 Q. Sir, where are you employed? 6 A. Ocean First Bank. 7 Q. What is your title? 8 A. It's the assistant vice-president and post closing manager. 9 Q. How long? 10 MR. ARONWALD: Sorry. I didn't get that assistant 11 vice-president and -- 12 THE WITNESS: Post closing manager. 13 Q. How long have you been employed by Ocean First Bank? 14 A. Since July 2007. 15 Q. Where were you employed before that? 16 A. Before that, at First Interstate Financial. 17 Q. Where is Ocean First Bank located? 18 A. The main office is in Toms River, New Jersey. 19 Q. What are your duties and responsibilities at Ocean First 20 Bank? 21 A. I oversee a department whose main responsibility is taking 22 closed loans and selling them to other banks. Also responsible 23 for making sure collateral is in place, recorded mortgages, 24 title policies, items of that nature. 25 Q. What do you mean by collateral? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1915 C36Qann1 Jenik - Direct 1 A. The collateral as far as land records go, if the mortgage 2 has been recorded against the property, the subject property. 3 Q. Are you familiar with an entity known as Columbia Equities? 4 A. I am. 5 Q. What is Columbia Equities? 6 A. Columbia Equities is a subsidiary of Ocean First Bank. 7 Q. What does Columbia Equities do? 8 A. They are no longer operating. At the time they originated 9 residential loans. 10 Q. What did Columbia Equities do in the year 2004, and '05? 11 A. I'm sorry, they were loan originators. 12 Q. What does it mean to be a loan originator? 13 A. They solicited -- they solicited residential loans, opened 14 up loans, lent money to borrowers. 15 Q. Where was Columbia Equities headquartered? 16 A. Their main office was in Valhalla, New York. 17 Q. Is that Westchester County? 18 A. It is. 19 Q. You said the relationship between Ocean First Bank and 20 Columbia Equities was that of owner subsidiary? 21 A. Correct. 22 Q. Can you explain what that means? 23 A. Basically, all the ownership of Columbia was owned by the 24 bank; there was no other entities that were part owners. 25 Q. And what was the relationship in the years 2004 and 2005? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1916 C36Qann1 Jenik - Direct 1 A. A wholly owned subsidiary. 2 Q. When did Columbia Equities stop originating new loans? 3 A. Roughly October/November 2007. 4 Q. Are you familiar with the business records of Columbia 5 Equities? 6 A. Yes. 7 Q. Did that entity arrange to make loans to Sandy Annabi? 8 A. They did. 9 Q. Directing your attention to Government Exhibit 478 for 10 identification. 11 MR. CARBONE: For the record, your Honor, 478 which 12 just provided to the Court and counsel and contains a list of 13 proposed Government Exhibits relating to certain loan files 14 originated by Columbia Equities. 15 Q. Mr. Jenik, have you reviewed the exhibits reflected on that 16 list? 17 A. I have. 18 Q. Have you compared the exhibits on that list to the records 19 contained in the loan files relating to Sandy Annabi? 20 A. Yes. They are the same records that are in our files. 21 Q. What categories of records are described on that list? 22 A. Documents you'd find in an open loan file. 23 Q. And are they business records of Columbia Equities? 24 A. Yes. 25 Q. Are all these records kept in the regular course of SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1917 C36Qann1 Jenik - Direct 1 Columbia Equities' business? 2 A. They are. 3 Q. And it's the regular practice of Columbia Equities to make 4 and keep such records? 5 A. Yes. 6 Q. Are the entries on the records made at or are the documents 7 received at or near the dates reflected on the documents? 8 A. To my knowledge, yes. 9 Q. And are they created by or received from someone with 10 knowledge of the transaction? 11 A. Generally, yes. 12 MR. CARBONE: Your Honor, at this time the government 13 offers the exhibits identified on Government Exhibit 478 for 14 identification into evidence. 15 MR. ARONWALD: Voir dire, Judge? 16 THE COURT: Yes. 17 MR. ARONWALD: Your Honor, I can do it from here. 18 THE COURT: Anywhere is fine. 19 MR. ARONWALD: Your Honor, can I impose upon the court 20 reporter just to have the last question and answer read back? 21 THE COURT: Would you, please. 22 (Read back) 23 VOIR DIRE EXAMINATION 24 BY MR. ARONWALD: 25 Q. Well, Mr. Jenik, do you know whether in this case the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1918 C36Qann1 Jenik - Direct 1 documents that are listed on Government Exhibits 478 were in 2 fact made by a person familiar with the actual transaction? 3 A. That would be the normal course of business. 4 Q. But do you know whether or not these documents on this 5 exhibit were in fact prepared by a person familiar with the 6 transaction? Yes or no. 7 THE COURT: The problem, sir, is that you said 8 "generally, yes" when you answered Mr. Carbone's last question. 9 "Generally, yes" suggests that there are exceptions to the 10 general rule. Is it the invariable business practice or are 11 there circumstances when it's not the business practice for 12 these records to be created or received from someone with 13 knowledge of the transaction? 14 THE WITNESS: There's not circumstances where 15 they're -- they would not be done. 16 THE COURT: I'm sorry. 17 THE WITNESS: I said generally because it was prior to 18 my employment. 19 THE COURT: These records were created prior to the 20 time you were employed by the bank? 21 THE WITNESS: Correct. 22 BY MR. ARONWALD: 23 Q. Well, the fact of the matter is these documents that -- 24 withdrawn. Are you the person that was responsible for the 25 production of the documents to the government that are listed SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1919 C36Qann1 Jenik - Direct 1 on this exhibit or did someone else produce these documents? 2 A. Somebody else produced them to the government -- 3 Q. OK -- 4 A. -- from the company. 5 Q. I'm sorry? 6 A. From the company. 7 Q. From the company. And these transactions all relate to a 8 point in time before you were employed by Ocean First, correct? 9 A. That's correct. 10 Q. And at the time in 2004, was Columbia Equities at that 11 point a wholly owned subsidiary of Ocean First? 12 A. Yes, sir. 13 Q. OK. But you had nothing to do with the actual transactions 14 themselves that are reflected in these exhibits, correct? 15 A. That's correct. 16 Q. By the way, the documents that you produced -- withdrawn. 17 The documents that were produced, were those the original loan 18 documents or copies? 19 A. I believe they would be copies. The loans themselves were 20 sold to other companies. They would have -- the originals 21 would have been delivered to the company that purchased the 22 loans. 23 Q. Do you know who that company was that the loans were sold 24 to? 25 A. I do. The first lien for Bacon Place, I believe, was SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1920 C36Qann1 Jenik - Direct 1 National City. And there was another property Rumsey Road and 2 that was Nomura Funding. 3 Q. Was that information as to who the loans were sold to, was 4 that information that was provided to the government? 5 A. I believe so. 6 Q. OK. So as you sit here now, you don't know whether the 7 original documents relating to these loan transactions exist or 8 not, correct? 9 A. No. 10 Q. OK. As far as the documents that were produced, you had 11 nothing at all to do with the copying of those documents, 12 correct? 13 A. No. 14 Q. So, in other words, you don't know whether or not the 15 documents that were produced to the government are actual 16 copies of the original loan documents or not, do you? 17 A. Well, no -- 18 Q. Yes or no. 19 A. No, but how it works is there was an image system which all 20 the original documents are put in and it's stored in an image 21 system. They were printed out of that system. 22 Q. In your experience, you're aware of the fact that a number 23 of the loans that were written by Columbia Equities turned out 24 to be bad loans. 25 MR. CARBONE: Objection. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1921 C36Qann1 Jenik - Direct 1 THE COURT: Overruled. 2 Q. Correct? 3 MR. CARBONE: Objection to bad loans. 4 A. How would you define bad loans? 5 Q. Were there instances where you found that the loan officers 6 of the loan process were falsifying the loan documents to make 7 the applicant credit-worthy? 8 A. I don't know that's true. 9 Q. Did you ever hear that? 10 MR. CARBONE: Objection. 11 THE COURT: The objection is sustained. 12 Q. Do you know that it's not true? 13 MR. CARBONE: Objection. 14 THE COURT: The objection is sustained. 15 Q. Do you know whether in this instance the loans -- the 16 transactions that are reflected in these exhibits, do you know 17 whether the copies that were made were actual copies of the 18 original loan documents? Yes or no. 19 MR. CARBONE: Asked and answered. 20 THE COURT: Asked and answered. 21 MR. ARONWALD: Your Honor, we object to the 22 introduction -- we object to the admission of these documents. 23 THE COURT: Folks, go take a break. Don't discuss the 24 case. Keep an open mind. 25 Sir, Mr. O'Neill is going to take you off the witness SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1922 C36Qann1 Jenik - Direct 1 stand. 2 (Jury recessed; witness recessed) 3 (Continued on next page) 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1923 C36Qann1 Jenik - Direct 1 (Jury not present) 2 THE COURT: OK. Mr. Aronwald? 3 MR. ARONWALD: Your Honor, I don't believe that the 4 government has laid a proper foundation for the admission of 5 these documents -- 6 THE COURT: Well, they've laid a foundation for the 7 admission of the documents. The question is whether this 8 witness has the knowledge to answer the questions -- 9 MR. ARONWALD: Right. 10 THE COURT: -- that would be required to get them 11 admitted as business records. 12 MR. ARONWALD: Right. That's my point. And I think 13 that based upon what the witness has said, the government 14 hasn't established that at this point. 15 MR. CARBONE: Your Honor, I can ask a few follow-up 16 questions, but there is no requirement that the custodian of 17 records have been employed at the business entity at the time 18 the records were created. 19 THE COURT: No, no, no. Mr. Carbone, I appreciate 20 that. I appreciate that. But, you know, it's one of those 21 I-wasn't-born-under-a-toadstool moments. Columbia Equities, 22 guess what? I know what's been going on. There have been 23 substantial allegations of the falsification of documents by 24 this particular lender. 25 MR. CARBONE: Judge, that may well be so, and it may SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1924 C36Qann1 Jenik - Direct 1 have happened here, but that doesn't mean that the defendant 2 didn't knowingly submit false information to the bank. So I 3 don't see what Columbia Equities' employees or former employees 4 of Columbia Equities did or didn't do in some other case has 5 any relevance to -- 6 THE COURT: But I think Mr. Aronwald's point is we 7 don't know that they didn't do it in this case, right? Now, 8 maybe I admit the documents, and if that's not the information 9 that Ms. Annabi gave to the bank, Ms. Annabi can, of course, 10 get on the stand and say so. 11 MR. CARBONE: Exactly. Judge, we have never contended 12 that someone inside the bank didn't have a role in assisting 13 Ms. Annabi to fraudulently obtain these loans. That may have 14 happened. But these are business records. This witness came 15 in here as an employee of the bank. He is actually the 16 custodian of records for Columbia Equities, and that's what 17 custodians do: They bring in records and they say these are 18 the records that are maintained in the ordinary course of 19 business, which there is no dispute about that. The records 20 are made at or near the dates reflected on them, and it's their 21 ordinary course of business to make and keep the records. 22 Beyond that, your Honor, the "authenticity" -- 23 certainly we've established enough of a foundation to admit 24 them into evidence. It goes to the weight, not the 25 admissibility. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1925 C36Qann1 Jenik - Direct 1 THE COURT: OK. I understand. I'm thinking this 2 through. I just wanted the jury out of the room so I could 3 think this through. If in fact this is one of the loans that 4 some person at Columbia Equities falsified, it is no less a 5 business record of Columbia Equities. That's your position? 6 MR. CARBONE: That's our position. 7 THE COURT: OK. 8 MR. ARONWALD: Except, your Honor, it seems to me that 9 where there's a legitimate question as to the authenticity of 10 the original document itself, then the copy is not admissible. 11 And in this case, I think Mr. Carbone just said that the 12 falsification of the loans may have happened here. You're 13 shifting the burden of proof, by saying you can introduce a 14 document that has not been properly authenticated, to 15 Ms. Annabi. 16 THE COURT: It has been authenticated. It's a 17 business record of the bank. If the bank business records are 18 in fact not authentic, it doesn't make them inadmissible. It 19 means they're subject to attack. 20 MR. ARONWALD: I think, your Honor, that it comes down 21 almost to a situation where the Best Evidence Rule would 22 require the production of the original and the copy would be 23 admitted in its place unless there is a dispute as to the 24 authenticity of the original. What we're saying here is that 25 in the first place we don't even know whether the originals SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1926 C36Qann1 Jenik - Direct 1 exist because according to this witness, the loans were sold to 2 two other institutions. 3 THE COURT: Right. 4 MR. ARONWALD: I haven't seen any records from those 5 two other institutions, and it may very well be that the 6 original documents are in the possession of those lenders, and, 7 if they are, then those are the documents that we should be 8 talking about. 9 THE COURT: Those investors; not those lenders. The 10 lender was Columbia Equities. 11 (Continued on next page) 12 13 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1927 C36UANN2 1 THE COURT: Those investors, not the lenders; the 2 lender was Columbia Equities. 3 MR. ARONWALD: Just so that we are clear, given the 4 importance of these documents, it seems to me that before they 5 are admitted against Ms. Annabi that all of the "i"s should be 6 dotted and all of the "t"s crossed in terms of trying to 7 determine whether these are originals -- whether or not these 8 are actual copies of the actual documents themselves. If an 9 original document is altered so as to make the applicant 10 creditworthy and the information that the applicant provides is 11 discarded and then that altered document now comes into the 12 system, that is really what we are talking about here. I don't 13 think that this witness is in a position to rule out the 14 possibility that what has been produced as a business record is 15 not in fact an alteration of the original information that the 16 applicant in this case, Ms. Annabi, produced. 17 The burden of proof is on the government to prove that 18 she is the one that submitted false information and to be able 19 to have the government argue that based upon these copies 20 themselves that that's all the evidence that they need to show 21 to establish their burden, it seems to me that that is not at 22 all probative. 23 THE COURT: It seems to me, Mr. Aronwald, if the 24 government is prepared to stand on that evidence, which I think 25 plainly qualifies as a business record under Rule 803 and is SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1928 C36UANN2 1 therefore admissible as a business record, that it does not 2 shift the burden of proof to you; it simply means that the 3 government has decided that this is enough evidence. It may 4 well not be enough. You may well want to call a witness to 5 talk about Columbia Equities and its document practices and 6 that which has out in the last few years. And if you proffer 7 such a witness, and you talk about it and who knows, I might 8 even let you call them. It does not shift the burden of proof 9 for the government to put in evidence that can only be 10 successfully rebutted by a defendant's testimony. That does 11 not shift the burden of proof, indeed, it happens all the time. 12 MR. CARBONE: Judge, if I may, in false statement 13 cases, every false statement case involves a document or a 14 statement within the document that is false. So this is really 15 no different. 16 THE COURT: It is alleged to be false. 17 MR. CARBONE: Alleged to be false, which we will 18 introduce testimony as well from an interview that was 19 conducted of Ms. Annabi where she in fact admits that she 20 signed these documents and she will say that she well knew or 21 suspected that the banks, the only way that they would have 22 approved two simultaneous $450,000 loans for her, given her 23 income, was that one didn't know about the other. That will be 24 the government's proof. You will see, Judge, that these loans 25 from two different lenders closed within three days of each SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1929 C36UANN2 1 other. 2 THE COURT: The objection is overruled. The documents 3 are admitted. Mr. Aronwald has his exception. 4 MR. ARONWALD: I understand that, Judge. I just 5 wanted chain of custody or chain of possession of the documents 6 themselves from the original until the time it became a copy. 7 That's all I am saying. 8 (Recess) 9 10 (Continued on next page) 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1930 C36UANN2 1 (Jury present) 2 THE COURT: The objection is overruled. 3 Sir, you are still under oath. 4 BY MR. CARBONE: 5 Q. Are you the designated records custodian for Columbia 6 Equities? 7 A. Yes. 8 Q. Prior to testifying here today, did you review the exhibits 9 identified on Government Exhibit 478 and compare those to the 10 records maintained in Columbia Equities files? 11 A. Yes. 12 Q. Were all of those documents there? 13 A. Yes. 14 Q. Directing your attention to July of 2004, were the deposits 15 of Ocean First FDIC insured during this time period? 16 A. Yes, they were. 17 Q. Were they also FDIC insured in 2005? 18 A. Yes. 19 Q. How many loans did Columbia Equities originate for Sandy 20 Annabi? 21 A. They originated two. There was another loan that was 22 brokered to National City Mortgage. 23 Q. What does that mean? 24 A. It means that National City -- basically, they referred the 25 loan to National City, and they just collected a fee and SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1931 C36UANN2 1 national City process the load and did all the underwriting and 2 reviews themselves. 3 MR. CARBONE: Please broadcast Government Exhibit 480. 4 Q. What kinds of loans were these two loans? 5 A. You mean like the loan terms? 6 Q. The two separate loans that these documents are about? 7 A. There was a first lien for $440,000. This was for the 8 Bacon Place property. 9 MR. CARBONE: Can you maximize the top third of that 10 document, Mr. Turk. 11 Q. What is a uniform residential loan application? 12 A. It is basically a summary that the borrower fills out and 13 it is going to include other income, their assets, their 14 liabilities, the property they are looking to buy, where they 15 live now -- basically everything that you would find on an 16 application for credit. 17 Q. At what stage in the application process is the loan 18 application filled out? 19 A. There is one done when they initially apply when they first 20 inquire about a loan. And there are times when there is 21 another one done at closing, if it has been a long time and 22 there are changes made, they will update that form. 23 Q. What was the amount of the first loan in connection with 24 this property? 25 A. $440,000. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1932 C36UANN2 1 Q. What was the address which Ms. Annabi sought to borrow 2 money to purchase? 3 A. 45 Bacon Place in Yonkers, New York. 4 Q. Do you see where it says on the right "property will be"? 5 A. Yes. 6 Q. And what box did Ms. Annabi check? 7 A. It is checked off as "primary residence." 8 Q. The question it says "manner in which title will be held," 9 how did she respond there? 10 A. Herself, Sandy Annabi, solely. 11 Q. Please turn to page 2. 12 MR. CARBONE: Maximize the top box where it says 13 "Monthly Income and Combined Housing Information." 14 Q. What does the borrower here, Ms. Annabi, reflect as her 15 base employee income? 16 A. $9.366. 17 Q. Is that per month? 18 A. That is per month. 19 Q. And does she indicate that she has any other income? 20 A. Yes. 21 Q. How much. 22 A. 3474.38. 23 Q. What does she indicate as her total monthly income? 24 A. 12,841.55 for the month. 25 Q. Where it says on the right of box 5, "combine the monthly SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1933 C36UANN2 1 housing expenses," how much rent does Ms. Annabi indicate she 2 is paying? 3 A. $950 a month. 4 Q. Now, would you turn to page 3, please. 5 MR. CARBONE: Maximize the box that says 6 "Declarations." 7 Q. What was the total purchase price of this house? 8 A. $550,000. 9 MR. CARBONE: Mr. Turk, could you highlight box H on 10 "Declarations"-- yes, that's it, H. 11 Q. The box says: "Is any part of the down payment borrowed?" 12 What box was checked? 13 A. It indicated no. 14 MR. CARBONE: And now, Mr. Turk, could you please 15 maximize box L -- no, L comes after K. 16 Q. The box says: "Do you intend to occupy the property as 17 your primary residence?" 18 A. It is indicated yes. 19 MR. CARBONE: Mr. Turk, could you restore the document 20 and now maximize the signature section. 21 Q. What is the date that appears next to Ms. Annabi's 22 signature? 23 A. It looks like 6/12/04. 24 MR. CARBONE: Mr. Turk, could you maximize where it 25 says "Acknowledgment and Agreement," up through and including SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1934 C36UANN2 1 item number 1 in the "Acknowledgment and Agreement" section. 2 Q. Mr. Jenik, could you please read the language contained 3 under "Acknowledgment and Agreement" up through item 1? 4 A. "Each of the undersigned specifically represents to lender 5 and to lender's actual or potential agents, brokers, 6 processors, attorneys, insurers, services, successors and 7 assigns and agrees and acknowledges that: The information 8 provided in this application is true and correct as of the date 9 set forth opposite my signature and that any intentional or 10 negligent misrepresentation of this information contained in 11 the application may result in civil liability, including 12 monetary damages to any person who may suffer a loss due to 13 reliance upon any misrepresentation that I have made on this 14 application." 15 MR. CARBONE: Could you restore that and broadcast the 16 bottom section of the document, Jake. 17 Q. Now where it says "to be completed by interviewer, this 18 application was taken by," what box is checked? 19 A. "Face-to-face." 20 Q. And who is the interviewer identified? 21 A. Sam Hattar. 22 MR. CARBONE: Please broadcast Government Exhibit 481. 23 Q. What is Government Exhibit 481? 24 A. It is a loan application for 45 Bacon Place. 25 Q. Does this relate to the same property? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1935 C36UANN2 1 A. It does. 2 Q. Why are there two applications in the file? 3 A. I believe this one was signed at closing. Sometimes if 4 liabilities change or some of these figures change, they want 5 to update with the most current information at the time of 6 closing. 7 Q. Is the one submitted at closing or signed at closing 8 typically typewritten like this? 9 A. Yes. 10 MR. CARBONE: Maximize the bottom of the page where it 11 says "initials." 12 Q. Whose initials appear there in the bottom of the page? 13 A. SA. I assume it is the borrower's. 14 MR. ARONWALD: Objection to what he assumes, your 15 Honor. 16 THE COURT: Just what you know, sir, not what you 17 assume. 18 A. SA is the borrower's initials. 19 MR. CARBONE: Turn to page 2 and maximize the top half 20 of the page. 21 Q. What does Ms. Annabi indicate her base employment income 22 is? 23 A. $9,366.67 a month. 24 Q. Totally monthly income? 25 A. $12,841.25 per month. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1936 C36UANN2 1 Q. Referring to the second column from the right, what does 2 she indicate she is paying in monthly rent? 3 A. $950. 4 Q. Please turn to page 3. 5 MR. CARBONE: Maximize the top box where it says 6 "Schedule of Real Estate Owned." 7 Q. Now, does Ms. Annabi disclose anywhere on this form that 8 she had purchased a house three days earlier? 9 A. No. 10 MR. CARBONE: Please broadcast or highlight box H of 11 Section 8 of the declaration section. 12 Q. How did Ms. Sandy Annabi respond to the question "any part 13 of the down payment borrowed?" 14 A. No. 15 MR. CARBONE: Now, would you maximize or highlight, 16 rather, Section L? 17 Q. It says: "Do you intend to occupy the property as your 18 primary residence?" How did she respond to that question. 19 A. It was responded yes. 20 MR. CARBONE: Now, Mr. Turk, could you maximize 21 Ms. Annabi's signature. 22 Q. What is the date reflected next to Ms. Annabi's signature? 23 A. July 30, 2004. 24 Q. Turn to page 4, please. 25 MR. CARBONE: Maximize the bottom. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1937 C36UANN2 1 Q. Does the signature also appear on the continuation sheet? 2 A. Yes, it does. 3 Q. And the date of that signature? 4 A. July 30, 2004. 5 MR. CARBONE: Please broadcast Government Exhibit 483. 6 Q. What is Government Exhibit 483? 7 A. It is a landlord reference letter. It would confirm -- 8 they use this to confirm the housing history for the borrower. 9 Q. Who does Government Exhibit 483 reflect is Ms. Annabi's 10 landlord? 11 A. Adali Aguilar. 12 Q. The address she indicates she lives at? 13 A. 51 Linden Street in Yonkers. 14 Q. How much does she indicate that she was paying in rent? 15 A. $950. 16 MR. CARBONE: Please broadcast Government Exhibit 17 484D. 18 Q. Can you tell us what 484D is? 19 A. It is a bank statement for the borrower. 20 Q. What bank? 21 A. Hudson Valley Bank. 22 Q. For what month does this statement relate to? 23 A. March 2004. 24 Q. Is that March or is that May? 25 A. I'm sorry. It is May 2004. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1938 C36UANN2 1 MR. CARBONE: Mr. Turk, could you please maximize and 2 highlight two entries, 4/9 and 4/23 of '04. 3 Q. How much does it indicate was deposited on those dates? 4 A. It is the same amount for 4/9 and 4/23, $3,191.98. 5 MR. CARBONE: Now please broadcast Government Exhibit 6 484E. 7 Q. What does Government Exhibit 484E appear to be? 8 A. It is a pay statement for the borrower. 9 Q. I'm sorry. This is a pay stub? 10 A. Yes. 11 Q. And what is the deposit date reflected on the pay stub? 12 A. June 16, 2004. 13 Q. What does this document reflect at this point in time in 14 June, Ms. Annabi's gross year-to-date earnings are? 15 A. $56,200.04. 16 MR. CARBONE: Please broadcast Government Exhibit 17 484F. 18 Q. And what does Government Exhibit 484F appear to be? 19 A. The 2002 W-2 for St. Joseph's Hospital. 20 Q. Who is the employee? 21 A. Sandy Annabi. 22 MR. CARBONE: Mr. Turk, could you maximize the top 23 section of the W-2 where it says "wages, tips, other 24 compensation." That's good. 25 Q. How much does this W-2 indicate Ms. Annabi was paid by St. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1939 C36UANN2 1 Joseph's Hospital for the year 2002? 2 A. $92,106.74. 3 Q. Please broadcast 484G. What is Government Exhibit 484G? 4 A. 2003 W-2 from St. Joseph's Hospital. 5 Q. The employee? 6 A. Sandy Annabi. 7 Q. Now, referring to box 1, how much does this 2003 W-2 form 8 from St. Joe's indicate that Sandy Annabi was paid in that 9 year? 10 A. 98,739.86. 11 MR. CARBONE: Mr. Turk, could you please broadcast 12 560C and present it side by side with 484G -- I'm sorry. 560C 13 is not in evidence yet. 14 Mr. Turk, please broadcast Government Exhibit 488. 15 Q. And what is Government Exhibit 488? 16 A. It is an occupancy and financial status affidavit. 17 Q. Can you please turn to page 2. 18 MR. ARONWALD: What exhibit is this? 19 MR. CARBONE: 488. 20 Q. And maximize the signature. What is the date that this 21 document appears to have been signed? 22 A. July 30, 2004. 23 MR. CARBONE: Can you maximize the bottom of the page? 24 Q. What is reflected there? 25 A. July 30, 2004. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1940 C36UANN2 1 Q. Is that a notary stamp -- 2 A. It is. 3 Q. What is the date reflected on these documents in the file 4 for the closing? 5 A. I'm sorry. What is the question? 6 Q. The date of the closing. 7 A. July 30, 2004. 8 Q. Please turn to page 1 of 488, the occupancy and financial 9 status affidavit. 10 MR. CARBONE: Mr. Turk, beginning where it says 11 paragraph 2, "occupancy," can you maximize just that first 12 paragraph in the box that is checked. 13 Q. Mr. Jenik, could you please read the box that was checked? 14 A. "Principal residence, borrower either currently occupies 15 and uses the property as the borrower's principal residence or 16 the borrower will occupy and use the property as borrower's 17 principal residence within 20 days after borrower signs the 18 security instrument. Borrower will continue to occupy and use 19 the property as borrower's principal residence for at least one 20 year from the date that the borrower first occupies the 21 property, however, borrower will not have to occupy and use the 22 property as borrower's principal residence within the time 23 frames set forth above if lender agrees in writing that 24 borrower does not have to do so. Lender may not refuse to 25 agree unless the refusal is reasonable. Borrower will also not SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1941 C36UANN2 1 have to occupy and use the property as borrower's principal 2 residence within the time frame set forth above if extenuating 3 circumstances exist which are beyond borrower's control." 4 MR. CARBONE: Now broadcast paragraph 3. 5 Q. And can you read up to but not including the last sentence 6 of that paragraph? 7 A. "Borrower understands that lender is making the loan based 8 upon statements and representations contained in or made in 9 connection with the residential mortgage loan application given 10 by borrower to lender, the loan application. Borrower hereby 11 certifies that the information provided by borrower contained 12 in or made in connection with the loan application related to 13 borrower's financial status (such as borrower's employment, 14 income, available cash, debts, expenses, credit obligations, 15 and the like) has not changed significantly and that such 16 information accurately reflects borrower's current financial 17 status." 18 MR. CARBONE: Now broadcast paragraph 4 and maximize 19 that. 20 Q. Please read the first sentence. 21 A. "Borrower understands that borrower will be in default 22 under terms of the security instrument if, during the 23 application process for the loan, borrower or any persons or 24 entities acting at the direction of the borrower or with the 25 borrower's knowledge or consent gave materially false, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1942 C36UANN2 1 misleading or inaccurate information or statement to the lender 2 or failed to provide lender with material information in 3 connection with the loan, including but not limited to 4 representations concerning borrower's occupancy of the property 5 and borrower's financial status." 6 MR. CARBONE: Please broadcast Government Exhibit 490 7 and maximize the top two inches of the document. 8 Q. What is the title of this document? 9 A. "Affidavit and Agreement by Borrower and Property Seller." 10 MR. CARBONE: Now, Mr. Turk, would you maximize the 11 bottom third of the document where it says representation 12 number 7 and below. 13 Q. Mr. Jenik, could you please read representation number 7? 14 A. "That if indicated by an 'X' in the appropriate space 15 adjacent hereto, borrower affiant now occupies the property as 16 borrower affiant's principal residence or in good faith will so 17 occupy the property commencing such occupancy not later than 18 (A) 30 days after this date, or (B) 30 days after the property 19 shall first have become ready for occupancy as habitable 20 dwelling whichever is later." 21 Q. Is that box checked? 22 A. It is. 23 Q. And whose initials appear right below that check? 24 A. SA, the borrower. 25 MR. ARONWALD: Your Honor, objection to the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1943 C36UANN2 1 characterization as identifying as the borrower's initials. 2 The initials SA are there, but there has been no testimony that 3 Sandy Annabi placed her initials there. 4 MR. CARBONE: Your Honor, I will rephrase the 5 question. 6 THE COURT: Thank you, Mr. Carbone. 7 BY MR. CARBONE: 8 Q. What initials appear just before representation number 7 9 where the box is checked? 10 A. SA. 11 Q. Please turn to page 2. What is the name that appears above 12 the line that says "borrower affiant"? 13 A. Sandy Annabi. 14 Q. Is that a notary stamp below? 15 A. It is. 16 Q. And the date of notarization? 17 A. July 30, 2004. 18 MR. CARBONE: Please broadcast Government Exhibit 493. 19 Q. What is Government Exhibit 493? 20 A. The borrower's certification and authorization. 21 MR. CARBONE: Please maximize paragraph 1. 22 Q. Please read paragraph 1. 23 A. "In applying for the loan, I completed a loan application 24 containing various information on the purpose of the loan, the 25 amount and source of the down payment, employment and income SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1944 C36UANN2 1 information, and assets and liabilities. I certify that all of 2 the information is true and complete. I made no 3 misrepresentations in the loan application or other documents, 4 nor did I omit any pertinent information." 5 MR. CARBONE: Now maximize paragraph 3, please. 6 Q. And please read paragraph 3. 7 A. "I/we fully understand that it is a federal crime 8 punishable by fine or imprisonment or both, to knowingly make 9 any false statements when applying for this mortgage, as 10 applicable under provisions of Title 18, U.S. Code, Section 11 1014." 12 MR. CARBONE: And restore the document and maximize 13 the signature section. 14 Q. What is the date that this document appears to be signed? 15 A. July 30, 2004. 16 MR. CARBONE: Please broadcast Government Exhibit 510. 17 Q. Mr. Jenik, we are going to segue into the other loan. 18 A. OK. 19 MR. CARBONE: Maximize the top third of the document. 20 Q. What is Government Exhibit 510? 21 A. This is the contract of sale for the property here -- it is 22 Rumsey Road property. 23 Q. Would you please turn to the last page of Government 24 Exhibit 510. And what signature appears there under 25 "purchaser"? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1945 C36UANN2 1 A. Sandy Annabi. 2 MR. CARBONE: Now, broadcast Government Exhibit 511. 3 Q. What is Government Exhibit 511? 4 A. It is the loan application for 245 Rumsey Road in Yonkers, 5 New York. 6 Q. Who is the borrower? 7 A. Sandy Annabi. 8 Q. And what is the amount that she sought to finance? 9 A. 57,600. 10 Q. Does it indicate a unit at 245 Rumsey Road? 11 A. It does, Unit 1B. 12 Q. Does it indicate what kind of premises this is? 13 A. It is a co-op. 14 Q. Now, referring to the borrower's information, where does it 15 indicate that the borrower lives? 16 A. Borrower's present address is listed as 45 Bacon Place, 17 Yonkers, New York. 18 Q. Please turn to page 2. 19 MR. CARBONE: And maximize Section 5 on top of the 20 page, "Monthly Income and Combined Housing Expense 21 Information." 22 Q. How much does it indicate there that Ms. Annabi earns a 23 month? 24 A. $9,366.67. 25 Q. Where it says "B) other income," what does it indicate SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1946 C36UANN2 1 there? 2 A. $3474.58. 3 Q. Is that entry explained before? 4 A. Explained below or on the first page, it has second job and 5 on the first page it has the additional employment as well. 6 Q. Referring back to the first page where it says "Borrower 7 Employment Information"? 8 A. Right. 9 MR. CARBONE: Maximize the City of Yonkers box. 10 Q. And how much does it indicate that she receives in salary 11 from the City of Yonkers? 12 A. $3474.58 a month. 13 Q. Let's go back to page 2. 14 MR. CARBONE: Maximize that Section 5 again where it 15 says "rental income," and there is a C next to it. 16 Q. What number does that tie into on the left side of the 17 form? 18 A. They are tying that rental income into on the next page, 19 they are showing a list of properties and rent. 20 Q. Let's turn quickly to page 3 on the top of the page where 21 it says that the real estate box? 22 A. Correct. 23 Q. What pieces of real property on this application does 24 Ms. Annabi indicate she owns? 25 A. 45 Bacon Place, 13 Patton Drive, and we have the subject SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1947 C36UANN2 1 property listed on here but then it is taken off. 2 Q. Please turn back to page 2. 3 MR. CARBONE: Maximize the top section, Section 5 4 again. 5 Q. Now, that rental income, is that rental income that she 6 receives or pays? 7 A. That is income, so it is what is received. 8 MR. CARBONE: And now turn to page 3 again -- sorry, 9 Mr. Turk, if you could scroll back to page 2. 10 Q. What is the amount of income that Ms. Annabi indicates she 11 receives? 12 A. $836. 13 MR. CARBONE: Now, on page 3, please broadcast the 14 "Declaration" section, maximize H. 15 Q. The question is: "Is any part of the down payment 16 borrowed?" How did Ms. Annabi respond? 17 A. Indicated no. 18 Q. Question L: "Do you intend to occupy the property as your 19 primary residence?" How does she respond? 20 A. No. 21 MR. CARBONE: And maximize, please, and restore this 22 document. 23 Q. Again, below the signature where it says "to be completed 24 by interviewer," it says "this application was taken by," what 25 box is checked? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1948 C36UANN2 1 A. "Face-to-face interview." 2 Q. Who does it indicate that the interviewer was? 3 A. Sam Hattar. 4 MR. CARBONE: Please broadcast Government Exhibit 512. 5 Q. And what is Government Exhibit 512? 6 A. It is an application for this same property dated at the 7 date of closing. 8 Q. Why is this form typewritten? 9 A. Because it is the final application. 10 MR. CARBONE: Please maximize the box below "borrower" 11 where it indicates a change in the document. 12 Q. Did you see where it says 45 Bacon Place as the present 13 residence? 14 A. Yes. 15 Q. What does it indicate there where someone struck through 16 those lines and handwrote something in? 17 A. 53 Linden Street, Yonkers, New York. 18 Q. Are there initials next to that change? 19 A. There are. 20 Q. Is the bottom of the page also initialed? 21 A. Yes. 22 Q. Would you turn to page 2, please. 23 MR. CARBONE: Maximize the top half of the page where 24 it says "Monthly Income and Combined Housing Information." 25 Q. What does Ms. Annabi reflect as her total monthly income? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1949 C36UANN2 1 A. $13,617.25. 2 Q. And other income? 3 A. I gave you the total. Did you not want the total? 4 Q. I was looking at the box that says "B) other income," how 5 much is the other income? 6 A. $3,474.58. 7 Q. Thank you. 8 Would you please turn to page 3. 9 MR. CARBONE: Maximize the top box that says "Assets 10 and Liabilities Continued, Schedule of Real Estate Owned." 11 Q. And what pieces of real property does Ms. Annabi disclose 12 that we owns in this section? 13 A. 45 Bacon Place and 13 Patton Drive. 14 Q. What are the total combined amount of outstanding mortgages 15 on those two properties, according to Ms. Annabi? 16 A. $1,002,040. 17 Q. Does she indicate that she is receiving any rental income 18 from 13 Patton Drive? 19 A. Yes. 20 Q. How much does she indicate she is receiving? 21 A. 4600. 22 MR. CARBONE: Again, Mr. Turk, on the "Declarations" 23 section, can you please maximize question H. 24 Q. Where it says, "Is any part of the down payment borrowed?" 25 How did Ms. Annabi respond? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1950 C36UANN2 1 A. Indicated no. 2 MR. CARBONE: Please restore the document and maximize 3 the signature section. 4 Q. What is the date that this document is signed? 5 A. February 14, 2005. 6 Q. Now, please turn to Government Exhibit 515. 7 MR. CARBONE: Maximize the change where it says 8 "mortgage information that was made." 9 Q. What change is reflected there? 10 A. The address changed from 45 Bacon Place to 53 Linden 11 Street. 12 MR. CARBONE: May I have one moment, your Honor? 13 THE COURT: Yes. 14 MR. CARBONE: No further questions. 15 Thank you, Mr. Jenik. 16 CROSS-EXAMINATION 17 BY MR. ARONWALD: 18 Q. Mr. Jenik, you were not involved in either of the loan 19 transactions with respect to 45 Bacon Place or 245 Rumsey Road, 20 correct? 21 A. That's correct. 22 Q. Do you know who Sam Hattar is? 23 A. I know he worked for Columbia. That's it. 24 Q. Have you ever met him? 25 A. No. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1951 C36UANN2 Jenik - cross 1 Q. Have you ever spoken to him? 2 A. No. 3 Q. So you certainly have never had any conversations with him 4 concerning either of these two loan applications, correct? 5 A. I did not. 6 Q. You don't know of your own knowledge whether any of the 7 information that is provided in these loan applications is 8 anything but accurate, do you? 9 A. No. 10 Q. And you don't know whether or not any of the application 11 that is in these documents accurately represents the 12 information that was provided by the borrower to Sam Hattar, do 13 you? 14 A. Well, the information that is on the application is 15 supported with loan documents. 16 Q. You don't know whether any of the information that is 17 filled out in the application is the information that was 18 actually provided by the borrower to Sam Hattar, do you, yes or 19 no? 20 A. No. 21 Q. You don't know whether Sam Hattar in any way falsified or 22 altered the documents that were provided by the borrower in 23 order to make the borrower creditworthy, do you, yes or no? 24 A. I don't know that. 25 Q. With respect to the handwriting on the applications, you SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1952 C36UANN2 Jenik - cross 1 don't even know whose handwriting that is, do you? 2 A. No. 3 Q. With respect to the signatures of Sandy Annabi that 4 appear -- withdrawn. 5 You don't know whether any of the signatures that 6 appear on any of the documents about which you have testified 7 is actually the signature of Sandy Annabi, do you, yes or no? 8 A. No. 9 Q. By the way, with respect to the information that is 10 reflected on these documents concerning the borrower's monthly 11 income, do you know whether or not Sam Hattar or anyone else 12 from Columbia Equities ever contacted St. Joseph's Medical 13 Center to verify the information that is reflected on these 14 documents in evidence, do you? Yes or no? 15 A. No. 16 Q. Now, do you know whether or not anyone from Columbia 17 Equities, including but not limited to Sam Hattar, at any time 18 ever conducted any interview of any other employer to 19 determine whether or not the information that is reflected on 20 the documents in evidence with respect to other income 21 accurately reflected what the other income was, do you? 22 A. No, just what was in the loan file. 23 Q. You testified a few moments ago about a second job. Do you 24 remember that. Do you know what the second job was? 25 A. It is listed on the application. It says Borough of SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1953 C36UANN2 Jenik - cross 1 Yonkers, I believe. 2 Q. City of Yonkers, City Council? 3 A. Yes. 4 Q. Did anyone from Columbia Equities, included but not limited 5 to Sam Hattar, ever contact the city of Yonkers to determine or 6 verify that the other income that was reflected in these loan 7 applications accurately represents the income that Ms. Annabi 8 was receiving as a city councilwoman, yes or no? 9 A. They may have done a verbal verification, but I don't 10 know -- 11 Q. My question to you is, you weren't even there at the time 12 these loan applications were processed, were you? 13 A. That's correct. 14 Q. So you don't know whether or not in fact anyone from 15 Columbia Equities, including but not limited to Sam Hattar, 16 ever contacted the City of Yonkers to verify: A) that she was 17 employed as a city councilwoman, and B) what her income was as 18 a city councilwoman, do you? Yes or no? 19 A. No. 20 21 (Continued on next page) 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1954 C35Qann3 Jenik - Cross 1 BY MR. ARONWALD: 2 Q. Can we go to Government Exhibit 88? Go to the first box 3 that's checked under number 2. 4 The first sentence reads: Borrower either currently 5 occupies and uses the property as borrower's principal 6 residence or borrower will occupy and use the property as 7 borrower's principal residence within 60 days after borrower 8 signs the security instrument. 9 What is the security instrument? 10 A. The mortgage. 11 Q. Is that something that would customarily be done at the 12 time of the closing? 13 A. Yes. 14 Q. So from the language in this document, all that was 15 required was that the borrower occupy the premises within 60 16 days after the date of the mortgage, correct, or the date after 17 the mortgage is signed by the borrower, correct? 18 A. Right, and then continue to occupy for at least one year. 19 Q. Then it says: The borrower will continue to occupy and use 20 the property as the borrower's principal residence for at least 21 one year from the date that the borrower first occupies the 22 property, correct? 23 A. Mmm-hmm. Correct. 24 Q. Now, it says: Borrower will not have to occupy and use the 25 property as borrower's principal residence within the time SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1955 C35Qann3 Jenik - Cross 1 frames set forth above if extenuating circumstances exist which 2 are beyond the borrower's control. Do you see that? 3 A. I see that. 4 Q. There is nothing in this document which indicates or 5 defines what the extenuating circumstances need to be, correct? 6 A. No. 7 Q. With respect to the loan application -- 8 MR. ARONWALD: May I just have a moment, your Honor? 9 THE COURT: Yes. 10 (Pause) 11 MR. ARONWALD: May I consult with counsel? 12 THE COURT: Please. 13 (Pause) 14 MR. ARONWALD: Your Honor, after consulting with 15 government counsel, I believe we are offering as -- we are 16 moving into evidence -- 17 THE COURT: You are offering. 18 MR. ARONWALD: Offering into evidence Government 19 Exhibit 485 with no objection. 20 MR. CARBONE: No objection. 21 THE COURT: Admitted. 22 (Government's Exhibit 485 received in evidence) 23 MR. ARONWALD: Could we have that put up on the 24 screen, please? 25 Q. Are you familiar with a verbal verification of employment SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1956 C35Qann3 Jenik - Cross 1 concerning a salaried borrower? 2 A. Yes. 3 Q. Is that something that is customarily or routinely done in 4 cases where there is a mortgage loan application submitted for 5 a residential property? 6 A. Yes. 7 MR. ARONWALD: Thank you. You can put that down. 8 Q. With respect to Government Exhibit 510 -- not 510 -- it 9 would be 511, this would be the loan application for 245 Rumsey 10 Road, correct? 11 A. Yes. 12 Q. Once again, with respect to the handwriting on this 13 document, you don't know whose handwriting that is, correct? 14 A. I don't, no. 15 Q. There is on page 2, under section 6, assets and 16 liabilities. Could we just have the portion on the right-hand 17 side highlighted, please. 18 Now, the loan application requires that the applicant 19 or the borrower basically list all of their outstanding 20 liabilities, correct? 21 A. Yes. 22 Q. In this case, the borrower listed various outstanding 23 mortgages, correct? 24 A. Yes. 25 Q. And also the unpaid balance on each of the mortgages, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1957 C35Qann3 Jenik - Cross 1 correct? 2 A. Yes. 3 Q. Including Fremont Investment in two places, correct? 4 A. Correct. 5 Q. Do you know what those loans or property those loans relate 6 to? 7 A. 13 Patton Drive. 8 Q. What about National City mortgage? 9 A. That would be Bacon Place, 45 Bacon Place. 10 Q. Then there is a portion where the borrower lists the 11 Mercedes Benz as another creditor or liability? 12 A. Yes. 13 Q. Monthly payments of $597 per month? 14 A. Yes. 15 Q. With the unpaid balance of just a little over $4,100, 16 correct? 17 A. Correct. 18 Q. Then it says City Bank STU. Do you know what that means? 19 A. Student -- I'll assume it's student loan. 20 Q. I don't want you to assume. If you don't know, you don't 21 know. 22 A. Typically somebody would put STU for a student loan. 23 Without having a credit report in front of me to match the 24 numbers up, I couldn't say for sure. 25 Q. Do you know whether anyone from Columbia Equities ever SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1958 C35Qann3 Jenik - Cross 1 contacted any of these mortgage companies to make sure that the 2 information that was reflected under the assets and liability 3 section was in fact accurate? You don't know that, do you? 4 Yes or no. 5 A. Again, the standard is -- 6 Q. I'm not asking you the standard. I'm asking do you know? 7 A. No. 8 Q. Then if we turn to page 3, the upper portion under -- right 9 there, those three lines, those are the places which indicate 10 the properties on which the other mortgages relate to, correct? 11 A. Correct. 12 Q. You testified earlier that in the application on page 2 13 under monthly income, there is $836 listed as rental income? 14 A. Yes. 15 Q. Turning on to page 3, if we could see that, the rental 16 income box is left blank. There is no number in there, is 17 there? 18 A. For Bacon Place? 19 Q. It says rental income. So basically the information that's 20 reflected here does not -- there is nothing on page 3 21 indicating what the rental income, what property it's derived 22 from on page 3. 23 A. Yeah, it's the fourth column from the right, rental income. 24 It's blank in Bacon Place, but in Patton Drive there's a number 25 4,600 and then it's got another number scratched next to it SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1959 C35Qann3 Jenik - Cross 1 like 3,950. 2 Q. 3,956? 3 A. Possibly. 4 Q. Or 3,950. So the 3,950 reflects the rental income, is that 5 what you're saying? 6 A. Well -- 7 Q. If you don't know, you don't know. 8 A. No, they'll reduce it by the payment on that, the mortgage 9 payment on that, and then for underwriting purposes, they could 10 only use a percentage of that as income. 11 MR. ARONWALD: Thank you. No further questions. 12 THE COURT: Thank you, Mr. Aronwald. 13 Mr. Siano. 14 MR. SIANO: No questions. 15 THE COURT: Anything more from the government? 16 MR. CARBONE: Briefly, your Honor. 17 REDIRECT EXAMINATION 18 BY MR. CARBONE: 19 Q. Mr. Jenik, what is the standard or custom and practice for 20 verifying assets and liabilities? 21 A. Typically, when you're filling out an application, that 22 initial application -- there will be a credit report available 23 so you can say my balance is how they match up to the credit 24 report to see if that application is correct. And as you get 25 along further in the process, if it's items you are going to SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1960 C35Qann3 Jenik - Redirect 1 pay off, you'll get payoff quotes, and they'll show you the 2 balances that are outstanding, the payments that are 3 outstanding, so you can get that final application tuned in to 4 exactly what you need. 5 Q. Now, if someone buys a house and closes on the loan just 6 three days before they close on a second loan, is it likely 7 that that liability is going to show up in the credit report? 8 A. No. 9 MR. CARBONE: Thank you. No further questions. 10 MR. ARONWALD: Nothing further. 11 THE COURT: You may step down, sir. 12 (Witness excused) 13 THE COURT: Call your next witness, please. 14 MR. CARBONE: The government calls Dean Civitelli. 15 DEAN CIVITELLI, 16 called as a witness by the Government, 17 having been duly sworn, testified as follows: 18 DIRECT EXAMINATION 19 BY MR. CARBONE: 20 THE DEPUTY CLERK: Tell us your name. 21 THE WITNESS: Dean Civitelli. 22 THE DEPUTY CLERK: Spell that, please. 23 THE WITNESS: D-E-A-N; C-I-V-I-T-E-L-L-O. 24 THE COURT: You may inquire. 25 MR. CARBONE: Thank you. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1961 C35Qann3 Civitelli - Direct 1 Q. Good afternoon, Mr. Civitelli. Sir, where are you 2 employed? 3 A. St. Joseph's Medical Center in Yonkers, New York. 4 Q. What is your title? 5 A. I'm vice-president of human resources. 6 Q. How long have you been employed by St. Joseph's? 7 A. For about five years. 8 Q. What are your job duties? 9 A. As vice-president of human resources, I'm responsible for 10 employment, recruitment, labor relations, employment relations, 11 files, documentation, health benefits and pension. 12 Q. Do you know the defendant, Sandy Annabi? 13 A. Yes. 14 Q. Was she previously employed at St. Joseph's Medical Center? 15 A. Yes. 16 Q. What position, if any, did she hold at St. Joseph's in the 17 year 2004? 18 A. I believe she was in the public relations office. 19 Q. Now, as the member of St. Joseph's staff, did you become 20 familiar with the records of St. Joseph's? 21 A. Yes. 22 Q. Please look at Government Exhibits 560 through 560-C which 23 are in the binder in front of you. 24 A. OK. 25 Q. What are those records? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1962 C35Qann3 Civitelli - Direct 1 A. 560-C is a W-2 form. It has the wages earned for the year 2 2003. 560 is what we call a change of status form. It's 3 transfer from one position to another back in, I believe, 2005. 4 560-A is another change of status form. It's used for 5 a change of address. 6 And 560-B is another W-2 form with wages listed for 7 2002. 8 Q. Do those records all relate to Sandy Annabi's employment 9 with St. Joseph's? 10 A. Yes, they do. 11 Q. Are they kept in the ordinary course of St. Joseph's 12 business? 13 A. Yes. 14 Q. As the ordinary course of business to make and keep such 15 records? 16 A. Yes. 17 Q. Are they made at or near the dates reflected on them? 18 A. Yes. 19 Q. Are the entries on the documents made by someone with 20 knowledge of the transactions? 21 A. Yes. 22 MR. CARBONE: Your Honor, we offer Government Exhibits 23 560 through 560-C in evidence. 24 MR. ARONWALD: No objection. 25 THE COURT: Admitted. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1963 C35Qann3 Civitelli - Direct 1 (Government's Exhibits 560 through 560-C received in 2 evidence) 3 Q. Mr. Turk, could you please broadcast Government Exhibit 4 560. 5 What is Government Exhibit 560? 6 A. It's a change of status form for a transfer from the 7 position of provider relations coordinator to public relations 8 coordinator. 9 Q. What date was this form executed? 10 A. It has an effective date of 1/18/05 and appears to be 11 signed by VP of human resources on 2/23/05. 12 Q. Does it indicate what Ms. Annabi's salary was as of the 13 date this form was executed? 14 A. Yes. 15 Q. How much was her annual salary? 16 A. $61,193.83. 17 THE COURT: Sir, could you get back just a tiny bit 18 from that microphone? 19 A. $61,193.86. 20 Q. Now please broadcast Government Exhibit 560-A. What is 21 Government Exhibit 560-A? 22 A. It's a form to change an address. 23 Q. What is the date of this form? 24 A. It has an effective date of 1/1/04, and I signed it on, I 25 believe, 1/28/08. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1964 C35Qann3 Civitelli - Direct 1 Q. Sir, you said the effective date was 1/1/04? 2 A. Yes. 3 Q. Now, what is the date -- what is the address, the original 4 address? 5 A. 245 Bacon Place, Yonkers, New York. 6 Q. And the new address? 7 A. 245 Rumsey Road, 1B, Yonkers, New York. 8 Q. Please broadcast Government Exhibit 560-B. What is 9 Government Exhibit 560-B? 10 A. It's a W-2 form for the year 2002. 11 Q. For Sandy Annabi? 12 A. Yes. 13 Q. Mr. Turk, would you please -- Mr. Civitelli, please read 14 the total in box one where it says wages, tips and other 15 compensation? 16 A. $49,106.74. 17 Q. Mr. Turk, could you please broadcast Government Exhibit 18 484-F and 560-B simultaneously. 19 Mr. Civitelli, I want you to look at Government 20 Exhibit 484-G, and please read box one. 21 A. $98,739.86. 22 Q. Now, let's try this again. Mr. Turk, would you broadcast 23 484-F. There we go? And 560-B? 24 A. I'm sorry. 25 Q. Now, what are the total wages, tips and other compensation SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1965 C35Qann3 Civitelli - Direct 1 reflected in Government Exhibit 484-F? 2 A. $92,108.74. 3 Q. And what year does that W-2 appear to relate to? 4 A. 2002. 5 Q. Now tell us what the box one wages, tips and other 6 compensation reflected in the W-2 form contained in the St. 7 Joseph's files was? 8 A. $49,106.74. 9 Q. What is the approximate difference? 10 A. Approximately $51,000. 11 Q. Now, Mr. Turk, could you please broadcast Government 12 Exhibit 560-C. What is Government Exhibit 560-C? 13 A. The income tax W-2 form for 2003. 14 Q. This is the one contained in St. Joseph's files? 15 A. Yes. 16 Q. What does St. Joseph's report to the IRS Ms. Annabi 17 received in total wages, tips and other compensation in 2003? 18 A. $56,739.86. 19 Q. Mr. Turk, would you please broadcast side by side 560-C and 20 484-G. 484-G, Mr. Civitelli, does that appear to be an IRS W-2 21 form for 2003? 22 A. Yes. 23 Q. And for the same individual? 24 A. Yes. 25 Q. Would you please read the total wages, tips and other SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1966 C35Qann3 Civitelli - Direct 1 compensation reflected in the W-2 form for 2003 identified as 2 Government Exhibit 484-G in evidence? 3 A. $98,739.86. 4 Q. How does that compare with the real one contained in St. 5 Joseph's files? 6 A. It appears to be a difference of about $42,000. 7 MR. CARBONE: Thank you. No further questions. 8 CROSS-EXAMINATION 9 BY MR. ARONWALD: 10 Q. Could we have 484-F put up on the screen? And could we 11 have 560-B put up? Could we have them put up together? 12 560-B, is that a W-2 form that St. Joseph's Hospital 13 was using in that year? 14 A. Yes. 15 Q. And the form that appears in 484-F, that's not the form 16 that St. Joseph's was using in that year, is it? 17 A. No. 18 Q. Could we look at 484-G. Could we have 560-C put up 19 alongside that. 20 So, again, asking the same questions, the form that is 21 reflected to the right, that would be 560-C, that was the same 22 form that was used by St. Joseph's Hospital as W-2 for the year 23 2003, correct? 24 A. Yes. 25 Q. And the form to the left which is 484-G, the W-2 for St. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1967 C35Qann3 Civitelli - Cross 1 Joseph's, that was not the form that St. Joseph's Hospital used 2 in 2003, correct? 3 A. No, it was not. 4 Q. Mr. Civitelli, there was one other thing that I was -- one 5 of the other exhibits that you were questioned about was the 6 Government Exhibit 515. I am directing your attention to -- 7 I'm sorry, I beg your pardon -- 560. 8 MR. ARONWALD: Your Honor, is it OK if I ask the 9 questions from here just because the book is here? 10 THE COURT: Certainly, as long as you keep your voice 11 up. 12 MR. ARONWALD: I will try. 13 THE COURT: Thank you. 14 MR. ARONWALD: Could we have 560-A put up, please? 15 Q. Mr. Civitelli, am I pronouncing your name correctly? 16 A. Yes. 17 Q. That's your signature in the lower left-hand corner where 18 it says approved by, correct? 19 A. Yes. 20 Q. And the date above that is January 28, 2008? 21 A. Yes. 22 Q. Is that your handwriting? 23 A. Yes. 24 Q. With respect to the rest of the handwriting on this form, 25 do you know whose handwriting that is? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1968 C35Qann3 Civitelli - Cross 1 A. No. 2 Q. In any event, with respect to the change from to to, so 3 from 245 Bacon Place to 245 Rumsey Road, directing your 4 attention to the left hand portion, it says -- it looks like it 5 says -- well, it says 245 Rumsey Road, and then the 2 is 6 crossed out, Rumsey Road is crossed out, and then we have the 7 number 45 and then Bacon Place. Do you see that? 8 A. Yes. 9 Q. And you did not cross out the 2 or cross out Rumsey Road, 10 did you? 11 A. No. 12 Q. Now, directing your attention to the right-hand side, you 13 testified that the effective date looked like January 1 of 14 2004. If you take a closer look at that is the date July 1, 15 2004 or you're not sure? 16 A. I'm not sure. 17 Q. So it could either be January 1 or July 1 of 2004, correct? 18 A. Yes. 19 Q. Now, these change of status forms serve what purpose when 20 it comes to change of address? 21 A. It's a notification to the hospital that a person has 22 changed their address, their legal mailing address. 23 Q. When it comes to paychecks, are those hand delivered to the 24 employees at the hospital or are they mailed to the employee? 25 A. Most of the time they're hand delivered. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1969 C35Qann3 Civitelli - Cross 1 Q. In the case of Sandy Annabi, do you know whether they were 2 hand delivered or whether they were mailed? 3 A. I do not know. 4 Q. Can you explain why the effective date is either January 1 5 or July 1 of '04 and yet it was not approved by you until some 6 four years later? 7 A. No. 8 MR. ARONWALD: Thank you. No further questions. 9 MR. SIANO: No questions, your Honor. 10 MR. CARBONE: Nothing further. Thank you, sir. 11 THE COURT: Thank you, sir. You may step down. 12 (Witness excused) 13 THE COURT: Call your next witness, please. 14 MR. CARBONE: The government calls Carl Maniscalco. 15 MR. HALPERIN: Judge, Mr. Maniscalco is downstairs. 16 We can call a different witness. 17 THE COURT: Let's do that. 18 MR. HALPERIN: The government calls Odilon Mejia. 19 ODILON MEJIA, 20 called as a witness by the Government, 21 having been duly sworn, testified as follows: 22 DIRECT EXAMINATION 23 BY MR. HALPERIN: 24 THE DEPUTY CLERK: Tell us your full name. 25 THE WITNESS: Odilon Mejia. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1970 C35Qann3 Mejia - Direct 1 THE DEPUTY CLERK: Spell that for us. 2 THE WITNESS: O-D-I-L-O-N. Mejia, M-E-J-I-A. 3 THE COURT: You may inquire. 4 MR. HALPERIN: Thank you. 5 Q. Good afternoon, Mr. Mejia. 6 A. Good afternoon. 7 Q. Sir, were you subpoenaed to testify here today? 8 A. Yes. 9 Q. What do you work, Mr. Mejia? 10 A. I'm a baker. 11 Q. Where is your bakery located? Just what city is it in? 12 A. Yonkers, New York. 13 Q. Now, how did you first come to arrive in the United States? 14 A. How I came? 15 Q. Did you come in legally or illegally? 16 A. Oh, I came illegally. 17 Q. Illegally? 18 A. Illegally. 19 Q. How old were you when you came here? 20 A. I was 17 years old. 21 Q. How many years ago was that when you were 17? 22 A. About 25 years ago. 23 Q. Were you ever sponsored? 24 A. Yes. 25 Q. What's your citizenship now? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1971 C35Qann3 Mejia - Direct 1 A. I'm a United States citizen. 2 Q. I'm sorry? 3 A. U.S. citizen. 4 Q. When did you become a U.S. citizen? 5 A. About 18 years ago. 6 Q. Now, Mr. Mejia, are you one of the owners of a building at 7 51 Linden Street in Yonkers? 8 A. Yes, correct. 9 Q. Who else owns the building with you? 10 A. My brother-in-law and my brother. 11 Q. What are their names, sir? 12 A. Jose Zamora and Juan Mejia. 13 Q. Z-A-M-O-R-A? 14 A. Correct. 15 Q. And he's your brother-in-law? 16 A. My brother-in-law, yeah. 17 Q. And your brother's name again? 18 A. Juan Mejia. 19 Q. What's the name of your company? 20 A. JOJ Rent-A-Corp. 21 Q. About what year did you buy the building at 51 Linden 22 Street? 23 A. About like 2009 -- no, '89, I think. 24 Q. Was it around 1999? 25 A. '99 sorry. 1999. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1972 C35Qann3 Mejia - Direct 1 Q. How many floors does the building have? 2 A. Three floors. 3 Q. How many apartments are on each floor? 4 A. Three apartments on -- two apartments on each floor. 5 Q. So how many apartments does the building have in total? 6 A. Six in total. 7 Q. Are the apartments rental units? 8 A. Yes, correct. 9 Q. Has that been the case since you bought the building in 10 1999? 11 A. Correct. 12 Q. Now, how often are your tenants supposed to pay the rent? 13 A. Well, they pay monthly. 14 Q. Once a month? 15 A. Once a month. 16 Q. Has that been the case since 1999? 17 A. Yes, correct. 18 Q. Let me direct your attention to the time frame 1999 to 19 2004. During that time, who collected the rents from the 20 tenants? 21 A. Jose Zamora and me. 22 Q. Your brother-in-law and you? 23 A. Yes. 24 Q. When you bought the building at 51 Linden Street in 1999, 25 who was living in apartment 1S on the first floor of 51 Linden SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1973 C35Qann3 Mejia - Direct 1 Street? 2 A. The Annabi family. 3 Q. When you say the Annabi family, which family members were 4 living in apartment 1S at the time when you first bought the 5 building? 6 A. Well, there was the mother, Ms. Maysoun Annabi, the two 7 sons and a daughter. 8 Q. What was the daughter's name? 9 A. Sandy Annabi. 10 Q. Until about when, what year, did the Annabis live in your 11 building? 12 A. Excuse me. Say that again. 13 Q. Until what year or so did the Annabi family live in your 14 building? 15 A. Around the summer of 2004, August of 2004, around there. 16 Q. Now, from 1999 when you bought the building through the 17 summer of 2004, how long did Maysoun Annabi, Sandy Annabi and 18 Maysoun's two sons live in apartment 1S? 19 A. Since I bought the building? 20 Q. In other words, did they live there that whole time, part 21 of the time? 22 A. When they live all -- all those years until they move, they 23 live in that apartment. 24 Q. So, for that five-year period, they lived in that 25 apartment? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1974 C35Qann3 Mejia - Direct 1 A. Yes. Yes. 2 Q. At some point during that time which, if any, other Annabi 3 family members also moved into apartment 1S? 4 A. A year later on the father, I think the husband of Maysoun 5 Annabi, move into the apartment. 6 Q. Now, while the Annabis lived at 51 Linden Street apartment 7 1S, did you ever go into their apartment on occasion? 8 A. Occasionally once in awhile when I had to fix something 9 like faucets or kitchen, repair. 10 Q. To make repairs? 11 A. To make repairs in the apartments. 12 Q. Now, when you first bought the apartment in 1999, how was 13 the rent being paid for the Annabis' apartment? 14 A. It was paid by social service. 15 Q. You'd get a check from them monthly? 16 A. Yes, by social service. 17 Q. Was there a balance of rent on top of what you were getting 18 from social service? 19 A. Yes, there was a partial balance, yeah, that she paid cash. 20 Q. When you say paid cash, who paid you that balance of the 21 rent? 22 A. Maysoun Annabi. 23 Q. The mother? 24 A. The mother. 25 Q. Now, at some point, what happened with the payments for the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1975 C35Qann3 Mejia - Direct 1 Annabis from social services? 2 A. Well, later on -- 3 Q. Go ahead. 4 A. Later on they stopped the payments, social service, and 5 just start paying me the rent. 6 Q. Roughly what year was that that social service stopped the 7 payments? 8 MR. ARONWALD: Your Honor, objection on relevance 9 grounds. 10 THE COURT: I'll let him go on. The objection is 11 overruled. 12 Q. You can answer, sir. What year? 13 A. I think they stopped paying -- social service stopped 14 paying the rent, if I'm not mistaken, in August 2001. 15 Q. Now, from roughly that time, from August 2001 until the 16 family moved out in the summer of 2004, which family member 17 paid the rent for the Annabis? 18 MR. ARONWALD: Objection again, your Honor. 19 Relevance. 20 A. The mother. 21 THE COURT: Overruled. 22 Q. This goes to -- 23 A. The mother. 24 Q. Maysoun Annabi? 25 A. Maysoun Annabi. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1976 C35Qann3 Mejia - Direct 1 Q. How did Maysoun Annabi pay the cash, in what form -- excuse 2 me -- pay the rent, in what form? 3 A. In cash. 4 Q. From 2001 to 2004, who collected the rent from tenants at 5 your building? 6 A. Me and Jose Zamora most of the time. 7 Q. How many times did Sandy Annabi pay the monthly rent? 8 A. Not -- I don't know. She didn't pay rent, Sandy Annabi. 9 The mother always paid me rent. 10 Q. The mother always paid you rent? 11 A. The mother always paid the rent. 12 Q. Let me ask you to pull out -- in front of you, you have a 13 folder there? I'll ask you to pull out what's been marked as 14 Government Exhibit 551. Take a moment to look at those. I 15 think the originals are underneath. Do you see those? Sir, do 16 you recognize these items? 17 A. Yes, they're receipts that we use to give the Annabis 18 family when they pay the rent. 19 Q. For what years do these receipts for rental payments cover 20 from beginning to end? What's the first year? 21 A. September 1, 2001. 22 Q. What's the date of the -- 23 A. The last one was August 30, 2004. 24 Q. Did you provide these receipts to the government? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1977 C35Qann3 Mejia - Direct 1 MR. HALPERIN: Your Honor, the government offers 2 Government Exhibit 551 into evidence. 3 MR. ARONWALD: Objection on relevance grounds. 4 MR. HALPERIN: It goes directly to -- 5 THE COURT: Overruled. 6 MR. HALPERIN: Thank you. 7 (Government's Exhibit 551 received in evidence) 8 Q. Mr. Turk, if you can display the first page of 551, please. 9 Mr. Mejia, let's start with the very first item. What's the 10 date on this document, sir? 11 A. September 1, 2001. 12 Q. What does it say next to received from? 13 A. From Annabi Maysoun. 14 Q. And the address? 15 A. 51 Linden Street, Apartment 1S. 16 Q. That was your building? 17 A. Yes, that's correct. 18 Q. What was the amount listed? 19 A. $520. 20 Q. In the for line, what does it say? 21 A. Rent of September. 22 Q. Mr. Turk, let's restore it to the larger screen. For these 23 three payments in 2001, sir, who was the rent received from 24 each time? 25 A. Annabi, Maysoun. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1978 C35Qann3 Mejia - Direct 1 Q. Mr. Turk, can we have page 2, please. 2 Mr. Mejia, what year do these four receipts relate to? 3 Just what year first. What year is this now, for these four 4 receipts? 5 A. 2002. Yeah, 2002. 6 Q. Let's start with the first one, please. What's the date at 7 the top of this receipt, sir? 8 A. January 1, 2002. 9 Q. The rent was received from who? 10 A. From Annabi, Maysoun. 11 Q. What was the total amount? 12 A. Amount $520. 13 Q. Next to the word for, what does it say there? 14 A. For rent of January. 15 Q. Let's go back down, Mr. Turk, on these four receipts in 16 2002. 17 Who paid the rent each time, Mr. Mejia? 18 A. Maysoun Annabi. 19 Q. Mr. Turk, let's go to page 3, please. Maximize that. 20 What's the date of the top of this document, sir? 21 A. February 1, 2003. 22 Q. The received from line? 23 A. It says Annabi. 24 Q. And the total amount? 25 A. $550. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1979 C35Qann3 Mejia - Direct 1 Q. So does that indicate a rent increase? 2 A. Yes. Yes. 3 Q. What month did this receipt cover? 4 A. From February 1, 2003 to the 30th, 2003, for one month, 5 month of February. 6 Q. What was the highest rent you ever charged Maysoun Annabi? 7 A. The $550. 8 Q. This was the highest, 550? 9 A. Yes. Yes. 10 Q. Let's go to page 4, please. Thank you, Mr. Turk. 11 What was the date on page 4 here, sir? 12 A. August 1, 2004. 13 Q. Received from? 14 A. From Annabi. 15 Q. No amount is listed there, is that correct? 16 A. No, I must have forgot to put the amount on the receipt. 17 Q. What's the from and to at the bottom? What dates does this 18 period cover? 19 A. It says from August 1, 2004 to August 30, 2004. 20 Q. Who signed this one? 21 A. Me personally, I signed this. 22 Q. In the circle boxes there, which box is kind of checked as 23 to how the cash was received -- excuse me -- how the rent was 24 received? 25 A. Yes, it was marked cash. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1980 C35Qann3 Mejia - Direct 1 Q. OK. Thank you, Mr. Turk. 2 Now, sir, after the Annabi family moved out of your 3 building in and around, I think you said, August 2004, who, if 4 anyone, from the Annabi family moved into the building next 5 door at 53 Linden Street? 6 A. None that I know of. I never seen them again. 7 Q. None that you know? 8 A. No. No. 9 Q. Now, 2004, who owned the building at 53 Linden Street? 10 A. I think it was the family of -- 11 MR. ARONWALD: Objection. Objection. 12 THE COURT: I'm sorry. Excuse me. 13 MR. ARONWALD: Objection, your Honor, unless he knows 14 of his own knowledge and not through hearsay. Objection. 15 Q. Sir, do you know who owned the building in 2004, 53 Linden 16 Street? 17 A. Yeah, Maysoun's sister. 18 Q. Now, when the Annabis had been living in your building at 19 51 Linden Street from 1999 to 2004, who usually parked in front 20 of the building? 21 A. Well, all of them, the members; it could be the mother, the 22 sister, the daughter, and, you know, anyone was parking in 23 front of the building there. 24 Q. How many cars did the Annabi family have at the time? 25 A. I don't know exactly how many, but I saw at least two cars. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1981 C35Qann3 Mejia - Direct 1 Q. From the Annabi family? 2 A. Yes. 3 Q. Where would you usually see the Annabis park their cars in 4 the neighborhood? 5 A. In front of the building. 6 Q. At the time did you recognize Sandy Annabi's car? 7 A. Probably, yeah. I seen her going to work, but I don't know 8 exactly all the details. 9 Q. Now, during the time that the Annabis lived at 51 Linden 10 Street, how often would you generally see Sandy Annabi? 11 A. Often. Sometime when I go over there to the building 12 because I was constantly visiting the building, and I see her 13 there many times when I'm there. 14 Q. Now, after the Annabis moved out of your building around 15 August 2004, how many times did you see Sandy Annabi in the 16 neighborhood again? 17 A. Never seen her any more. 18 Q. What about her brothers or her parents? 19 A. None either. 20 Q. I'm sorry? 21 A. I didn't see them either. 22 Q. How many times did you see Sandy Annabi's car parked on the 23 block again? 24 A. I didn't see her any more. 25 Q. Mr. Mejia, we are now going to display Government Exhibit SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1982 C35Qann3 Mejia - Direct 1 459 which the Court has received into evidence. Let's maximize 2 the document, Mr. Turk. Thank you very much. 3 Mr. Mejia, when was the first time you saw this 4 document? 5 A. Last week in the office in the court, One Police Court. 6 Q. Last week in whose office? 7 A. In your office. 8 Q. What does it say at the top of this document, sir? 9 A. It says, Request for Verification of Rent or Mortgage. 10 Q. Let's maximize line seven first, Mr. Turk. Right there all 11 the way across the page, please. 12 What does it say under property address? What 13 property? 14 A. The property there is 51 Linden Street, Yonkers, New York, 15 10701. 16 Q. That's your building? 17 A. That's my building, yes. 18 Q. What does it say under account in the name of. Whose name? 19 Whose name is on the right right there? 20 A. Account in the name of, Sandy Annabi. 21 Q. Thank you, Mr. Turk. Let's expand again. Let me go back 22 to box one across the top of the page, Mr. Turk, please, the 23 top quarter of the page. Yes. Thank you. 24 Now, in box 1 could you please read that allowed, 25 under the to line. What does it say? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1983 C35Qann3 Mejia - Direct 1 A. Yeah, landlord Randa Rabadi, 51 Linden Street, Yonkers, New 2 York, 10701. 3 Q. Let's go down to part two of the form, Mr. Turk. Right 4 there to the bottom of the page, halfway down the form, sir. 5 That's great. 6 What does it say after tenant has rented since, could 7 you read that? 8 A. April 1, 2001 to present. 9 Q. What was the amount of rent? 10 A. $800 a month. 11 Q. OK. Let's go down to the -- actually, leave this up, 12 Mr. Turk. In the bottom right corner of the form, what's the 13 date that this form was filled out? 14 A. 7/9/2004. 15 Q. On the bottom left, whose name is there? 16 A. Randa Rabadi. 17 Q. And the title in the middle of the page? 18 A. Landlord, it does not have a name. 19 Q. Now, Mr. Mejia, from April 2001 to July 2004, was Randa 20 Rabadi ever the landlord at your building? 21 A. Not that I know. 22 Q. Well, you say not that you know. Was she or wasn't she? 23 A. No. 24 Q. Did she own the building at that time? 25 A. No. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1984 C35Qann3 Mejia - Direct 1 Q. Who owned the building -- 2 A. Me. 3 Q. -- during those years? You did? 4 A. I own it. 5 Q. During the rent -- excuse me -- during this time from 2001 6 to 2004, was the rent for the Annabi apartment ever $800? 7 A. No. 8 Q. You said before the highest rent you ever charged the 9 Annabis was what? 10 A. About $500 -- $520 or $550 something. 11 Q. $550? 12 A. $550. 13 Q. At the bottom of the page there, sir -- Mr. Turk, let's 14 just highlight the last line again. 15 Under the word landlord, it says phone number. Is 16 that your phone number, sir? 17 A. No. 18 Q. Was that ever your phone number? 19 A. Sorry? 20 Q. Was that ever your phone number? 21 A. No. I don't recognize that number. 22 Q. Thank you, Mr. Turk. Let's now display Government Exhibit 23 483 in evidence. 24 THE COURT: Tell me when it's a good time to break, 25 Mr. Halperin. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1985 C35Qann3 Mejia - Direct 1 MR. HALPERIN: This is a good time. 2 THE COURT: Somehow I knew that was what you were 3 going to say. OK. I'll see you folks just a little bit after 4 2:00, five after 2:00. Don't discuss the case. Keep an open 5 mind. 6 (Luncheon recess) 7 (Continued on next page) 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1986 C36UANN4 Mejia - direct 1 A F T E R N O O N S E S S I O N 2 2:10 p.m. 3 (In open court, jury present) 4 THE COURT: Sir, you are still under oath. 5 Please continue, Mr. Halperin. 6 MR. HALPERIN: Thank you. 7 ODILON MEJIA, resumed. 8 DIRECT EXAMINATION (Continued) 9 BY MR. HALPERIN: 10 Q. Good afternoon, Mr. Mejia. 11 MR. HALPERIN: Mr. Turk, can you please display 12 Government Exhibit 483 which the Court has received. 13 Q. Mr. Mejia, you can look on the screen in front of you. 14 When was the first time you saw this document, sir? 15 A. Last week in your office. 16 MR. HALPERIN: Now, let's highlight -- great, Mr. 17 Turk. 18 Q. At the top of the document, Government Exhibit 483, what is 19 the borrower's name listed? What is the name of the borrower? 20 A. Sandy Annabi. 21 Q. At what address? 22 A. 51 Linden Street, Yonkers, New York 10701. 23 Q. Can you read the next sentence aloud starting with "I"? 24 A. "I, Adali Aguilar." 25 Q. Keep reading that sentence, please. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1987 C36UANN4 Mejia - direct 1 A. "Hereby certify that the above referenced persons have 2 landlord" -- 3 Q. -- "have been tenants at 51 Linden Street, Yonkers, New 4 York." Is that what it says? 5 A. Yes. 6 Q. Do you know someone named Adali Aguilar? 7 A. Yes, I know him. 8 Q. Who is Adali Aguilar? 9 A. He is one of my tenants. 10 Q. He is one of your tenants? 11 A. Yes. 12 Q. At 51 Linden Street? 13 A. Correct. 14 Q. Which apartment does he live in? 15 A. Apartment 2S. 16 Q. When if ever was Aguilar the landlord at 51 Linden Street? 17 A. Never. 18 Q. How many times if ever did you ask Adali Aguilar to collect 19 the rent from Maysoun Annabi for you? 20 A. Never. 21 Q. Under "present payment," what is the figure there, the 22 number listed next to "present payment"? 23 A. $950. 24 Q. Down at the bottom of the page, what is the date filled in 25 above the line date? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1988 C36UANN4 Mejia - direct 1 A. June 30, '04. 2 Q. Over "landlord signature," do you know whose signature that 3 is, sir? 4 A. No. 5 Q. When if ever did you charge the Annabi family $950 a month 6 in rent? 7 A. Never. 8 MR. HALPERIN: Nothing else. 9 THE COURT: Mr. Aronwald. 10 MR. ARONWALD: Thank you, Judge. 11 CROSS-EXAMINATION 12 BY MR. ARONWALD: 13 Q. Good afternoon, Mr. Mejia. 14 How are you? 15 A. Good. Thank you. 16 Q. So you are one of the owners of 51 Linden Street, correct? 17 A. Correct. 18 Q. Actually, there is another entrance to that building at 49 19 Linden Street? 20 A. Correct. 21 Q. Two entrances to the same building? 22 A. Correct. 23 Q. The entrance at 49 is right next to the entrance for 51, 24 the two doors are right next to each other? 25 A. Correct. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1989 C36UANN4 Mejia - cross 1 Q. And 53 Linden Street, is that the building next door to 51 2 Linden Street? 3 A. Yes, that's correct. 4 Q. So 53 Linden Street would be on the other side of 51 than 5 49 is, correct? 6 A. No, it is not on the other. It is on the same side. 7 Q. So you have 49 Linden Street, then 51 Linden Street and 8 then next door 53 Linden Street, correct. 9 A. Yes. 10 Q. Is 53 Linden Street also a three-story building? 11 A. No. That is a bigger building. 12 Q. How many stories or floors is that building? 13 A. I don't know exactly, but has to be at least five floors. 14 Q. Now, you said that you and your brother-in-law purchased 51 15 Linden Street at what time, what year? 16 A. 2009. 17 Q. 2009? 18 A. No. 1989 -- 1999. 19 Q. And you have never lived at 51 Linden Street, have you? 20 A. No. 21 Q. You testified that you work as a baker? 22 A. Correct. 23 Q. Were you working as a baker back in 1999 also? 24 A. Correct. 25 Q. Have you been working at the same place as a baker since SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1990 C36UANN4 Mejia - cross 1 1999? 2 A. No. 3 Q. So between 1999 and 2004, were you working as a baker? 4 A. Correct. 5 Q. Were you working at the same place from the years 1999 to 6 2004 as a baker? 7 A. No. 8 Q. So you changed -- you worked as a baker, but you changed 9 your job between 1999 and 2004, correct? 10 A. That's correct. 11 Q. How many times did you change jobs between those years, 12 1999 to 2004? 13 A. Maybe three times, four times. 14 Q. When you were working as a baker between 1999 and 2004, how 15 many days a week were you working? 16 A. I was working six days and five days. 17 Q. Six days and five days. In other words, when you changed 18 jobs, did the number of days you were working change from six 19 to five? 20 A. No. Sometimes I work it -- it all depends how busy or how 21 much they need me, they give me six days or five days. 22 Q. How far was the place that you were working at from 51 23 Linden Street? 24 Let me strike that. 25 The first bake shop that you worked at, what was the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1991 C36UANN4 Mejia - cross 1 address of that bake shop? 2 A. 24 Palmer Avenue in Bronxville, New York. 3 THE COURT: What was that? 4 MR. ARONWALD: 24 Palmer Avenue in Bronxville is what 5 I heard. 6 Q. Is that correct? 7 A. That's correct. 8 Q. So you worked there from 1999 to what year? 9 A. No. I was working since 1985 to 2000 -- I think to 2000. 10 Q. So from 1985 to 2000 you were working as a baker at 24 11 Palmer Avenue in Bronxville? 12 A. Correct. 13 Q. How many days a week were you working there during that 14 period of time? 15 A. Six days. 16 Q. And do you recall what hours you worked? When did you 17 start working? Your typical workday, you would start at what 18 time and you would work until what time? 19 A. In that bakery, it was 3 o'clock and 4 o'clock in the 20 morning. 21 Q. So 3 o'clock or 4 o'clock in the morning is when you would 22 start? 23 A. Yes. 24 Q. What time would you leave work? 25 A. 12 or 1 o'clock in the afternoon. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1992 C36UANN4 Mejia - cross 1 Q. Were the six days a week the same days every week or did 2 they vary? Did you work Monday through Saturday or do you 3 remember? 4 A. Yes, I do remember. From Tuesday through Sunday. 5 Q. So that was the first bake shop at 24 Palmer Avenue. 6 By the way, is the bakery at 24 Palmer Avenue in 7 Bronxville within walking distance of 51 Linden Street? 8 A. Yes. 9 Q. You could walk from -- 10 A. No, you cannot walk. It is by car, it is two miles. 11 Q. How long? 12 A. Two miles. 13 Q. And then the second job that you had was what years? 14 A. I don't remember exactly, but after that I think I had my 15 own business. 16 Q. As a baker? 17 A. Yes. 18 Q. So that would be after that. Approximately what years do 19 you recall that you had your own bakery business? 20 A. 2001. 21 Q. Until? 22 A. I only had it for one year. 23 Q. So 2001 to 2002? 24 A. Yes. 25 Q. Do you remember the address of that bakery? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1993 C36UANN4 Mejia - cross 1 A. I think it was 55 Park Hill Avenue. I am not 100 percent 2 sure now, but I think 55 Park Hill Avenue in Yonkers. 3 Q. Park Hill Avenue? 4 A. In Yonkers. 5 Q. Was that in walking distance of 51 Linden Street? 6 A. Yes. 7 Q. How far was it? 8 A. Maybe three blocks. 9 Q. Were you working there six days a week then also? 10 A. Yes. 11 Q. Were you ever working seven days a week there? 12 A. No. 13 Q. So the six days a week you worked there, what were those 14 days? What days of the week did you work there at the Park 15 Hill Avenue bakery that you owned? 16 A. From Tuesday through Sunday also. Sometimes we work 17 Mondays but usually it is just six days because I have somebody 18 else to switch. 19 Q. What hours did you work? 20 A. From same hours -- no, a little bit longer, like we go home 21 like from 4 o'clock in the morning to maybe 3 o'clock and then 22 somebody else would -- they would close. 23 Q. After you were working at the Park Hill Avenue bakery, 24 where were you working after that up to 2004? 25 A. A few different bakeries for short periods of time. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1994 C36UANN4 Mejia - cross 1 Q. Do you remember where they were? 2 A. Yeah. One was in the Bronx. 3 Q. How long were you working at the one in the Bronx? 4 A. It was probably like six months only. 5 Q. And you were working six days a week there? 6 A. No, five days. 7 Q. And those five days were what? 8 A. At the bakery. 9 Q. No. What days were they? 10 A. I don't remember exactly the days, but I know that I work 11 on the weekends. It was probably from Wednesday through 12 Sunday. 13 Q. And when you were working in the Bronx, obviously you 14 couldn't walk from the bakery in the Bronx to 51 Linden Street, 15 right? 16 A. From the Bronx? 17 Q. Yes. 18 A. No. 19 Q. Where else did you work other than the bakery in the Bronx? 20 A. Tarrytown. 21 Q. Where? 22 A. Tarrytown. 23 Q. How long did you work in Tarrytown, the bakery in 24 Tarrytown? 25 A. For about a year. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1995 C36UANN4 Mejia - cross 1 Q. Five days a week or six days a week? 2 A. Five days a week. 3 Q. Do you remember what days of the week you worked? 4 A. I was off also Monday. Most of the bakeries, they give you 5 off Monday. 6 Q. So you were basically working Tuesday through Sunday? 7 A. Yes. 8 Q. What hours? 9 A. 4 o'clock to 1 o'clock. 10 Q. 4 o'clock in the morning? 11 A. Yes. 12 Q. To 1 o'clock in the afternoon? 13 A. Yes. 14 Q. Correct? 15 A. Correct. 16 Q. Then after that, where did you work? 17 A. After that I took a long time working for myself, taking 18 care of my properties. 19 Q. Working for yourself as a baker? 20 A. No. 21 Q. Just doing properties? 22 A. Taking care of my properties. 23 Q. What year was that? 24 A. Since 2000 and -- I think I have a fire in 2003 and there 25 was some construction for my own for one year. Then after that SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1996 C36UANN4 Mejia - cross 1 I didn't look for job, and I was just taking care of the 2 properties for maybe, I don't know, five, six -- maybe five 3 years. 4 Q. So what year did you start working as a baker again? 5 A. Excuse me. I found another job after I replaced -- fixed 6 my building, a couple of years later. A couple of years later 7 I found another job for the union. I remember for one year, 8 one year I worked for the union. 9 Q. What year was that? 10 A. I don't remember exactly the year. 11 Q. Do you remember whether it was before or after 2004? 12 A. It was after 2004. 13 Q. Was it after 2005? 14 A. It got to be around 2005. 15 Q. When you say you fixed your building, what building were 16 you referring to? 17 A. Another property, different property, not this property. 18 Q. Where was that property? 19 A. In Yonkers, New York. 20 Q. Where in Yonkers? 21 A. 217 Hawthorne Avenue in Yonkers, New York. 22 Q. And that is not within walking distance of 51 Linden, is 23 it? 24 A. Yeah, it could be, like maybe six to eight blocks. 25 Q. OK. And then you began working -- when was it that you SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1997 C36UANN4 Mejia - cross 1 started working as a baker again? 2 A. Three years ago. 3 Q. So that would be 2009? 4 A. Yes. 5 Q. So between 2005 and 2009, where were you working? Do you 6 remember? 7 A. I didn't work those years. 8 Q. So you just took care of your building? 9 A. Yes. 10 Q. And the building would be the 217 Hawthorne Avenue 11 building? 12 A. Yeah. And the other properties. 13 Q. Which other properties? 14 A. I have a couple more properties, yes, that I was taking 15 care of them. 16 You want the addresses? 17 Q. Are all of those properties in Yonkers? 18 A. Yes. 19 Q. And during the period from 1999 to 2004, where were you 20 living at that time? 21 A. At 217 Hawthorne Avenue. 22 Q. You were living there from 1999 to 2004, correct? 23 A. Correct. 24 Q. Did you move from that address to some other address after 25 2004? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1998 C36UANN4 Mejia - cross 1 A. After 2004, yes. 2 Q. Where did you move then? 3 A. To in Yonkers, another house in Yonkers. 4 Q. What was the address? 5 A. 214 -- 6 MR. HALPERIN: Objection to the specific address. 7 THE COURT: The objection is sustained. 8 THE WITNESS: 214 -- 9 THE COURT: No. It is OK. You don't have to answer 10 the question. 11 Next question. 12 BY MR. ARONWALD: 13 Q. During this period of time from 1999 to 2004, you saw the 14 rent receipts that were introduced when Mr. Halperin was asking 15 you some questions? 16 A. Can you repeat, please, the question? 17 Q. Yeah. The rent receipts, that would be Government Exhibit 18 551. 19 Now, do you remember seeing those before when Mr. 20 Halperin was asking you some questions? 21 A. Yes, correct. Yes. 22 Q. The three rent receipts that are listed on the first page, 23 those receipts are not in your handwriting, correct? 24 A. They are not on my handwriting. It is my brother-in-law's, 25 but I kept the book. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1999 C36UANN4 Mejia - cross 1 Q. You kept the book? 2 A. Yes. 3 Q. But you didn't collect these rents? 4 A. I didn't collect these rents -- no, sometimes, yes. Some 5 of them, I cannot tell you exactly which rent I collect. He 6 handled the receipts sometimes later on, sometimes like a week 7 later because, sometimes we don't have -- we only have one 8 receipt book, right, so if I go collect the rents like another 9 day later, he give the receipt or maybe sometimes it is the 10 same day. We don't know who collect the rent, maybe me or my 11 brother-in-law. 12 Q. Well, was it your practice at the time that whoever 13 collected the rent would be the one who would fill out the 14 receipt? 15 A. Yes, yes. 16 Q. So if we turn to the second page, these four receipts, that 17 is not your handwriting either, is it? 18 A. No. That's my brother-in-law. 19 Q. And if we turn to the third page, this is the only 20 receipt -- this receipt is also not in your handwriting, is it? 21 A. That is Jose Zamora's. 22 Q. Your brother-in-law? 23 A. My brother-in-law. 24 Q. If we go to the fourth page, do you recognize the 25 handwriting on this receipt? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2000 C36UANN4 Mejia - cross 1 A. Yes. 2 Q. Whose handwriting is that? 3 A. That's me. 4 Q. And that rent you collected, correct? 5 A. Yes. 6 Q. You also testified that you also make repairs in the 7 building? 8 A. Repairs, yes. 9 Q. Now, was it the usual practice between 1999 and 2004 that 10 your brother-in-law would be the one who would usually collect 11 the rents? 12 A. It was like a few months he did. Another month, I did it. 13 We take turns. 14 Q. By the way, during the period of time that the Annabi 15 family lived in the building, there was no lease, correct? 16 A. There was no lease. 17 Q. They were living there month to month? 18 A. Month to month. 19 Q. Were you at 51 Linden Street every day of the week? 20 A. Not every day of the week. 21 Q. During the period of time that you were working and you 22 told the jury when you were working and what days you worked 23 and what the hours were that you were working, you were at work 24 and not at 51 Linden Street, right? Do you understand my 25 question? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2001 C36UANN4 Mejia - cross 1 A. When I was working, I could not be there. 2 Q. From what you told us, during the period of time that you 3 were working as a baker, you were working five to six days a 4 week, generally from Tuesday to Sundays, beginning at 2 o'clock 5 in the morning and working until the afternoon, correct? 6 A. Correct. 7 Q. So on those days that you were at work, you don't know 8 whether Sandy Annabi's car was parked on the street of Linden 9 Street or not because you were not there, isn't that so? 10 A. When I wasn't there, no. 11 Q. By the way, across the street from 51 Linden Street, is 12 there a garage? 13 A. No. It was a parking lot. 14 Q. Where people would pay to park their car? 15 A. Correct. 16 Q. Was it an enclosed parking lot with a fence? 17 A. With a fence. 18 Q. Did you have to have a key to get into the lot? 19 A. I don't know. 20 Q. You don't know? 21 A. I don't know. 22 Q. In August of 2004, between 1999 and 2004, what car was 23 Sandy Annabi driving? 24 A. I don't know exactly what car she was driving. 25 Q. But there were other members of her family that drove cars, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2002 C36UANN4 Mejia - cross 1 correct? 2 A. Correct. 3 Q. Do you know whether or not the family members shared the 4 cars? Do you understand my question? 5 A. I don't know. 6 Q. You don't know whether they shared them or not? 7 A. Don't know. 8 Q. So all you can tell us is that when you were at 51 Linden 9 Street, you did not see Sandy Annabi, correct? 10 MR. HALPERIN: Objection. Ambiguous. 11 MR. ARONWALD: I'm sorry? 12 THE COURT: Overruled. 13 Q. Mr. Mejia, do you understand my question? 14 A. Could you repeat it again? 15 Q. Sure. I will be happy to. What you have told us is that 16 whenever you were at 51 Linden Street, after the Annabi family 17 moved out, you did not see Sandy Annabi, correct? 18 A. Correct. 19 Q. What you are telling us is that, after the Annabi family 20 moved out in August of 2004, you don't remember seeing Sandy 21 Annabi's car parked on the street? 22 A. Correct. 23 Q. But you are also telling us that at that time you don't 24 know what kind of car she drove, correct? 25 A. At that time I saw the cars, yeah. I seen her going to SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2003 C36UANN4 Mejia - cross 1 work, getting into the car, but I don't remember exactly what 2 color, what brand, you know -- they had a couple of cars, you 3 know. 4 Q. You said that you saw Sandy Annabi go to work? 5 A. Yes. 6 Q. That was while she was living at 51 Linden Street? 7 A. Correct. 8 Q. But you didn't see her go to work every day? 9 A. Not every day. 10 Q. Because you were not there every day, were you? 11 A. No, but every two or three days I was home because I was 12 checking the boiler almost every day -- either me or my 13 brother-in-law. 14 Q. Even when you were working between 3 o'clock in the morning 15 until 3 o'clock in the afternoon? 16 A. No, after work. 17 Q. So are you saying that at 3 o'clock in the afternoon is 18 when you saw Sandy Annabi going to work? 19 A. No. Sometimes, you know, I go on my days off and I see 20 her. And I go in the afternoon and saw her coming home. You 21 know, I cannot tell you exactly the details, the hours I seen 22 her. 23 Q. On those days and hours when you were not at 51 Linden 24 Street, you don't know whether Sandy Annabi was at 53 Linden 25 Street or not, do you? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2004 C36UANN4 Mejia - cross 1 A. I don't know. 2 MR. ARONWALD: Thank you very much. 3 Have a nice day. 4 No further questions. 5 THE COURT: Mr. Siano. 6 MR. SIANO: No questions. 7 MR. HALPERIN: Nothing further, Judge. 8 THE COURT: Thank you, sir. 9 You may step down. 10 (Witness excused) 11 THE COURT: Call your next witness. 12 MR. CARBONE: The government calls Frank Rocco. 13 FRANK ROCCO, 14 called as a witness by the government, 15 having been duly sworn, testified as follows: 16 DIRECT EXAMINATION 17 BY MR. CARBONE: 18 THE COURT: You may inquire. 19 MR. CARBONE: Thank you, your Honor. 20 BY MR. CARBONE: 21 Q. Good afternoon, Mr Rocco. 22 Sir, where do you live? 23 A. I live in 2 Fountain Lane, Scarsdale, New York. 24 Q. How far did you go in school? 25 A. I have a master's degree in taxation. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2005 C36UANN4 Rocco - direct 1 Q. Where do you work? 2 A. I'm self-employed. I have an office in Scarsdale. 3 Q. What is the name of your business? 4 A. Frank F. Rocco, CPA. 5 Q. How long have you been self-employed? 6 A. About 30 years. 7 Q. What did you do before that? 8 A. I worked for the Internal Revenue Service. 9 Q. Do you have any professional licenses? 10 A. I am a certified public accountant. 11 Q. How long have you been a certified public accountant? 12 A. Approximately 35 years. 13 Q. What do you do in your business? 14 A. I have a public accounting practice. We do mostly taxation 15 for businesses and individuals. 16 Q. Approximately how many returns a year do you prepare, 17 personal returns? 18 A. Approximately 500. 19 Q. Approximately how many business returns do you prepare a 20 year? 21 A. Say about 50. 22 Q. Do you know the defendant Sandy Annabi? 23 A. Yes. 24 Q. How do you know her? 25 A. She was a client. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2006 C36UANN4 Rocco - direct 1 Q. For approximately what years was she a client? 2 A. I have prepared her tax returns for the years 2003 and 3 2004. 4 Q. Have you met her in person? 5 A. Yes. She was in my office. 6 Q. Please look in front of you at Government Exhibits 607, 620 7 and 621? 8 A. 620 and 621, I see. 9 Q. 607? 10 A. Yes. OK. 11 Q. What is Government Exhibit 607? 12 A. I'm sorry. Repeat that. 13 Q. What is Government Exhibit 607? 14 A. It is a copy of a tax return. 15 Q. For what year? 16 A. For 2003. 17 Q. Is that the return that you prepared for Ms. Annabi? 18 A. Yes, it is. 19 Q. And 620, what is 620? 20 A. 620 is another copy of a tax return. 21 Q. And for what year is that? 22 A. 2004. 23 Q. Is that the return that you prepared for Ms. Sandy Annabi? 24 A. Yes, it is. 25 Q. What is Government Exhibit 621? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2007 C36UANN4 Rocco - direct 1 A. 621 are my notes of the preparation of the 2004 tax 2 returns. 3 Q. Are those notes kept in the ordinary course of business? 4 A. Yes, they are. 5 MR. CARBONE: Your Honor, the government offers 607, 6 620 and 621 in evidence. 7 MR. ARONWALD: Your Honor, may we have a sidebar? 8 THE COURT: Got all the way to a quarter of 3. 9 10 (Continued on next page) 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2008 C36UANN4 Rocco - direct 1 (At the sidebar) 2 THE COURT: Yes, Mr. Aronwald. 3 MR. ARONWALD: Judge, the tax returns that are charged 4 in this indictment are for 2005 and 2006. Mr. Rocco had 5 nothing to do with the preparation of those returns. I am 6 objecting to the relevance of 2003, 2004 and it wasn't part of 7 the government's 404(b) application. 8 MR. CARBONE: Judge, as to the 2004 return, the 9 government is offering that to show there's another return 10 preparer who she did not disclose additional income to. 11 THE COURT: 404(b). 12 MR. CARBONE: Judge, to the extent that the return 13 that he prepared does not reflect any rental income, it is 14 offered to prove that she was trying to conceal -- the 2004 15 return that he prepared, he gave to her. She never filed it. 16 She then went to Mr. Farhat, the second return preparer. He 17 did prepare it. It does have rental income for Patton. 18 THE COURT: 404(b). I am not letting it in. Why are 19 we bringing this up in the middle of trial at a sidebar? 20 MR. HALPERIN: It is direct proof of -- 21 THE COURT: 404(b). You guys file these letters all 22 the time and you say it is direct proof and if it is not direct 23 proof it is still 404(b). You alert me to this in advance. I 24 am not listening to this at a sidebar in the middle of trial 25 when they have at least a colorable argument. Why wasn't this SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2009 C36UANN4 Rocco - direct 1 aired before the trial? It should have been aired before the 2 trial. 3 MR. CARBONE: To the extent that it is direct evidence 4 of her receipt of the bribes, the financial benefit that Zehy 5 Jereis was giving to her because she never disclosed them to 6 her return preparer over the years -- 7 THE COURT: How is it evidence of her receipt of the 8 bribes if they were not disclosed? It is not evidence of 9 receipt of bribes if it was disclosed. Their argument is that 10 it was a gift. If it is a gift, it is not tax -- 11 MR. CARBONE: It is consciousness of guilt -- 12 THE COURT: That's it. Forget it. 13 14 (Continued on next page) 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2010 C36UANN4 Rocco - direct 1 (In open court) 2 MR. CARBONE: Judge, we have one additional point that 3 we need to clarify. 4 THE COURT: Go back in the back. 5 Don't discuss the case. Keep an open mind. 6 7 (Continued on next page) 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2011 C36UANN4 Rocco - direct 1 (Jury not present) 2 THE COURT: Sir, you need to step down. 3 (Witness not present) 4 MR. CARBONE: The jury just heard evidence from Joseph 5 Jenik from Columbia Equities that Ms Annabi submitted uniform 6 residential loan applications that claimed she was receiving 7 rent from the Patton Drive property. The tax return that Mr. 8 Rocco prepared does not reflect any rent for the Patton Drive 9 property. 10 THE COURT: She didn't file the tax return. You just 11 told me she went to someone else who prepared a different tax 12 return. You just said to me, she went to someone else after 13 this return was prepared and she told that person about rental 14 income because it shows rental income, and that's the one she 15 filed with the government. 16 MR. CARBONE: Yes, your Honor, true. But she went to 17 this return preparer. She had discussions about rental income 18 and he prepared a return based upon the information she 19 provided. 20 THE COURT: This is entirely too tenuous to qualify as 21 direct proof in my opinion, and it should have been disclosed 22 as 404(b) if you wanted to make these arguments and you didn't. 23 MR. CARBONE: Judge, may I make one other point? 24 You will hear a witness tomorrow saying that when 25 Ms. Annabi was interviewed, she was asked about rental payments SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2012 C36UANN4 Rocco - direct 1 and she said that she did not receive any rental payments. 2 THE COURT: That's fine. That witness is still 3 someone who interviewed her in connection with a mortgage 4 application. What she said in connection with a mortgage 5 application is indeed direct proof on your mortgage fraud 6 claim -- it is, if in fact she did not disclose rental income. 7 But this individual cannot say whether she did or did not 8 receive rental income. He is not giving that evidence. 9 MR. CARBONE: But, Judge, he is explaining why he 10 prepared a return that didn't reflect any rental income. 11 THE COURT: He is explaining why he prepared a return 12 that was never submitted to the government. 13 I'm sorry. I am not letting this in. This is 14 ridiculous. 15 MR. CARBONE: Judge -- 16 THE COURT: Mr. Carbone, you have lost. 17 MR. CARBONE: I just wanted to make one other point 18 before you make a final decision. 19 Her financial disclosure report that she submitted to 20 the City of Yonkers for the year 2004 doesn't disclose the 21 Patton Drive property at all. 22 THE COURT: That's fine. Put in the 2004 if it has 23 been disclosed as 404(b), but it has not been disclosed as 24 404(b). 25 MR. CARBONE: It has been in evidence. It is not SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2013 C36UANN4 Rocco - direct 1 404(b). It is directly relevant and it is part of the 2 conspiracy and -- 3 THE COURT: He has nothing to do with preparing her 4 financial disclosure form. Sorry. 5 MR. CARBONE: He prepared a tax return. It is 6 identical in scope to the financial disclosure form. 7 THE COURT: No, no. In fact, I think, given the fact 8 that she then went to a different tax preparer and had a tax 9 return prepared and filed that disclosed the rental income, I 10 am afraid this is so subtle that I think it would be confusing 11 to the jury. I am not letting it in. 12 Bring in the jury. 13 Bring in the witness. 14 MR. CARBONE: Judge, is it the Court's decision not to 15 permit any testimony by this witness even from 2003? 16 THE COURT: I have no idea what this witness is going 17 to do -- 18 (Witness present) 19 THE COURT: Get rid of the witness. 20 I think my ruling is pretty clear, Mr. Carbone. 21 MR. CARBONE: We were offering his testimony for two 22 reasons. 23 THE COURT: Get the witness out of here. Get him out 24 of here. Get the witness out of here. 25 (Witness excused) SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2014 C36UANN4 Rocco - direct 1 THE COURT: You cannot put in the draft unfiled 2004 2 tax return to prove anything. 3 Now, what do you want to do about 2003 which is three 4 years more remote? 5 Your biggest problem now, Mr. Carbone, with this 6 aspect of the case is, you don't have any evidence that I can 7 remember hearing that actually connects Mr. Jereis's payment to 8 some longstanding four-year-long, cooked-up scheme that some 9 day in case it would ever be needed, Sandy Annabi would vote 10 the way Zehy Jereis told her to vote. That is the missing 11 piece of evidence, and this guy certainly isn't helping you 12 provide any of it. 13 MR. CARBONE: Judge, we respectfully disagree with 14 that characterization. The indictment charges that the scheme 15 beginning in or about 2002 through 2008 -- we don't have to 16 prove a link between a payment and an official act. That is 17 not what we charged and that is not what we have to prove. 18 THE COURT: Tell that to the jury. 19 What you have to prove is an agreement. 20 Did you not charge conspiracy? 21 MR. CARBONE: We did, Judge. 22 THE COURT: You have to prove an agreement. 23 MR. CARBONE: Absolutely. 24 THE COURT: I think. I think. I think. That's the 25 way I generally charge conspiracy. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2015 C36UANN4 Rocco - direct 1 MR. CARBONE: Exactly. So if the agreement or 2 conspiracy runs from 2002 through 2008, how could it not be 3 relevant that in 2003 and 2004, while she is getting these 4 payments from Mr. Jereis, she has discussions with a return 5 preparer and she doesn't tell him anything about it? That is 6 relevant. It is smack in the middle of the scope of the 7 conspiracy. And the fact that she didn't tell him about these 8 payments is relevant. 9 THE COURT: I am not letting it in. That's it. 10 MR. ARONWALD: Your Honor, could I just ask for an 11 offer of proof from the government as to what else they expect 12 to elicit from this witness so that we don't have to have 13 another sidebar? 14 THE COURT: There is not going to be another sidebar. 15 You want an offer of proof 16 Give an offer of proof. 17 MR. CARBONE: I just did. I explained the offer of 18 proof. 19 THE COURT: Apparently she didn't tell him the same 20 thing in 2003 relating to an unfiled tax return. 21 MR. CARBONE: Judge, she didn't tell her return 22 preparers between 2002 and 2008 that she was getting financial 23 benefits from Mr. Jereis. We submit applications for tax 24 returns all the time and the argument we make -- 25 THE COURT: Excuse me. You want it admitted to prove SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2016 C36UANN4 Rocco - direct 1 consciousness of guilt. It does not go to consciousness of 2 guilt. I am sorry. It doesn't. You have failed to convince 3 me. Based on all the evidence that I have heard so far, you 4 have failed to lay a sufficient foundation for me to think that 5 this is consciousness of guilt. 6 MR. CARBONE: Judge, the fact that someone receives 7 unlawful payments and doesn't disclose them on their tax return 8 is clearly relevant. It is up to the jury to decide whether -- 9 THE COURT: It is not her tax return. You told me at 10 the sidebar that the tax return she filed disclosed the 11 payments. 12 MR. CARBONE: No, no, I did not say that, Judge. That 13 is rental income on Patton. 14 There are two different issues. I apologize if I am 15 not being clear. There are two different issues. We want to 16 offer the tax returns for the years 2002 through 2008 to show 17 that she failed to disclose unlawful income, i.e., the payments 18 that Mr. Jereis was giving her. 19 THE COURT: So we have left the rental return to one 20 side? Have we left the rental income to one side? 21 MR. CARBONE: Putting it aside for a minute because I 22 am obviously not explaining myself -- 23 THE COURT: No. I want to know, are we discussing the 24 rental income? What we were discussing over here was her 25 failure to tell this guy about the rental income on that SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2017 C36UANN4 Rocco - direct 1 particular property and nothing is coming in for that purpose. 2 You offered it for consciousness of guilt; it is not, as far as 3 I can tell. It ain't coming in. 4 Now, you have a whole different theory for introducing 5 all of the tax returns and it is that none of them discloses 6 any money or benefit that she got from Mr. Jereis. 7 MR. CARBONE: Absolutely. 8 THE COURT: For that purpose you can introduce the tax 9 returns. You can introduce the tax returns. You can introduce 10 them. And you can have a witness who has analyzed them testify 11 that they do not disclose the Mercedes. And they don't 12 disclose the rent payments. And they don't disclose the 13 jewelry. And they don't disclose all of those things. 14 Then of course it is up to the jury to decide whether 15 they need to be disclosed because they were unlawful payments 16 or they were gifts, in which case, Mr. Jereis may have a tax 17 problem but Ms. Annabi certainly does not. 18 MR. CARBONE: Judge, if the tax returns are relevant, 19 then the statements that she makes to the return preparer about 20 those payments have to be relevant. In fact, in two of the 21 years 2005 and 2006 -- 22 THE COURT: I want a proffer. What is this witness 23 going to say Sandy Annabi said to him about the Mercedes? What 24 is this witness going to say that this witness said to him 25 about the jewelry -- not that she didn't say anything? What is SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2018 C36UANN4 Rocco - direct 1 this witness going to say that Sandy Annabi said on those 2 subjects? 3 MR. CARBONE: Since those things didn't happen until 4 2006 -- 5 THE COURT: Then there is no reason to talk to this 6 witness. There's nothing that was said. 7 MR. CARBONE: Judge, she received financial benefits 8 in 2002 -- 9 THE COURT: Introduce the returns. Introduce the 10 returns. 11 MR. CARBONE: How can the returns be relevant if you 12 can't explain what she said to the return preparer. 13 THE COURT: I'm asking you, bring him in. You ask the 14 questions without the jury in the room. I want to hear what he 15 is going to say she said. What did she say? 16 FRANK ROCCO, resumed. 17 THE COURT: Sir, you are still under oath. We are 18 going to ask you a few questions without the jury present. 19 DIRECT EXAMINATION (Continued) 20 BY MR. CARBONE: 21 Q. Mr. Rocco, when you were preparing the 2003 tax return for 22 Ms. Sandy Annabi, did you sit down and interview her? 23 A. Yes, I did. 24 Q. What if anything did she tell you about financial benefits 25 she had received from Zehy Jereis? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2019 C36UANN4 Rocco - direct 1 A. Nothing. 2 Q. What if anything did she tell you about the subject of 3 whether Mr. Jereis was paying loans for her? 4 A. Nothing. 5 THE COURT: Keep going. I want a full proffer from 6 this witness so that Mr. Aronwald can make his argument. I 7 want a full proffer. 8 Q. After you prepared the return, what if anything -- what if 9 any discussions did you have with the defendant or how did you 10 satisfy yourself that all of the income received by the 11 defendant was reported on her return? 12 A. We generally ask a question, did you report everything? Is 13 everything on the tax return? 14 Q. Is that your custom and habit? 15 A. That's my custom, yes, it is. 16 MR. CARBONE: That's our proffer on that. 17 THE COURT: OK. Mr. Aronwald. 18 MR. ARONWALD: Your Honor, I am objecting to it. In 19 the first place it is 404(b), no matter how the government 20 wants to characterize it. The only two tax returns that are 21 charged in this indictment are '05 and '06. 22 THE COURT: He is alleging that it is direct proof on 23 the public corruption counts. 24 MR. ARONWALD: Judge, it is not proof of anything. 25 The fact of the matter is, I think in fact your Honor alluded SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2020 C36UANN4 Rocco - direct 1 to this at the sidebar. The fact is, if it is gifts or loans, 2 it is not reportable as income. 3 THE COURT: I understand. It is not your argument. 4 I will let you question the witness. I will explain 5 to the jury that this evidence is relevant only to the 6 conspiracy charge and no other charge as far as I can tell. 7 MR. CARBONE: That's correct. 8 THE COURT: It is not relevant to the tax counts. It 9 is critically important that the jury understand that it is not 10 relevant to the tax counts. He didn't prepare the relevant tax 11 returns. 12 Bring in the jury. 13 14 (Continued on next page) 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2021 C36Qann5 Rocco - direct 1 (In open court; jury present) 2 THE COURT: Folks, you are going to hear some evidence 3 which is relevant, first of all, only to the count that charges 4 conspiracy, which I think is Count One. 5 MR. CARBONE: Counts One and Two. 6 THE COURT: Counts One and Two, conspiracy, and to no 7 other count. 8 And because we're talking about taxes and tax 9 accounting and tax returns, I want to charge you specifically 10 that this evidence is not relevant to the tax counts that are 11 charged against Ms. Annabi. This is about different years. It 12 has nothing to do with the counts of tax fraud that have been 13 charged against Ms. Annabi. OK? I just want to make that very 14 clear. 15 With that caveat, you may proceed, Mr. Carbone. 16 MR. CARBONE: Thank you. 17 Your Honor, 607, 620 and 621 in evidence. 18 MR. ARONWALD: Objection, your Honor. 19 THE COURT: I'm sorry? 20 MR. ARONWALD: That was the objection. 21 THE COURT: The objection is overruled. They are 22 admitted for a limited purpose. 23 (Government's Exhibits 607, 620, 621 received in 24 evidence) 25 BY MR. CARBONE: SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2022 C36Qann5 Rocco - direct 1 Q. Mr. Rocco, can you explain the process that you use when 2 you prepare a tax return? 3 A. I generally interview the client and we go over whatever 4 pertinent documents they have and any issues that may be 5 lingering from a previous year, if necessary. 6 Q. Mr. Turk, would you broadcast Government Exhibit 607, page 7 2. Now referring to line 7, maximize line 7. 8 Mr. Rocco, what information is reflected in line 7 9 A. Line 7 would be the income that's reported on A client's 10 W-2s. 11 Q. Would you please turn to page 5, Mr. Turk, of the exhibit. 12 What is reflected on page 5 of Government Exhibit 607? 13 A. There is a W-2 from St. Joseph's Hospital. 14 Q. How much income is reflected on that W-2? 15 A. In box 1, which is the gross income taxable, would be 16 $56,739.86. 17 Q. Now, Mr. Turk, would you please broadcast page 2 of the 18 Government Exhibit 607 and maximize line 21. 19 Mr. Rocco, prior to preparing this return, did you 20 receive information from Ms. Annabi? 21 A. Regarding what? 22 Q. Regarding her income. 23 A. Yes, she gave me her W-2s. 24 Q. What, if anything, did you do to satisfy yourself that the 25 income on the return was all the income that Ms. Annabi had? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2023 C36Qann5 Rocco - direct 1 A. Well, again, we would -- I probably would have asked the 2 question -- 3 MR. ARONWALD: Objection to probably, your Honor. 4 THE COURT: We need to know what you did; not what you 5 think you did. 6 A. My normal procedure would be to ask -- 7 MR. ARONWALD: Objection. 8 THE COURT: Overruled. 9 A. My normal procedure would be to ask the client if there is 10 any other income to be reported. 11 Q. What, if any, information did Ms. Annabi describe to you 12 when you were preparing this return about whether she had 13 received any financial benefits from Zehy Jereis? 14 A. That never came up. That was never an issue. 15 Q. What, if anything, did she say on the subject of whether 16 Mr. Jereis had made any loan payments on her behalf? 17 A. It was never discussed. 18 Q. Did you also prepare a 2004 -- before we move off 19 Government Exhibit 607, Mr. Turk, would you turn to page 3 of 20 the exhibit. Maximize the bottom where it says "sign here." 21 Where is your office located at the time? 22 A. My office is in Scarsdale, 670 White Plains Road. 23 Q. Can you read the declaration right above Ms. Annabi's 24 signature? 25 A. It reads: Under penalties of perjury, I declare that I SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2024 C36Qann5 Rocco - direct 1 have examined this return and accompanying schedules and 2 statements, and to the best of my knowledge and belief they are 3 true, correct and complete. Declaration of preparer (other 4 than taxpayer) is based on all information of which preparer 5 has any knowledge. 6 Q. What is the date that indicates Ms. Annabi signed the 7 return? 8 A. Her date, it's handwritten, is April 7, 2004. 9 Q. Did you also prepare a return for Ms. Annabi the following 10 year? 11 A. Yes, I did. 12 Q. Mr. Turk, please broadcast Government Exhibit 620. Turn to 13 page 3 of the exhibit. 14 Is this your retained copy of the return you prepared? 15 A. Yes. 16 Q. Mr. Turk, please maximize line 21. 17 Where it says other income, did Ms. Annabi disclose 18 any additional income to you? 19 A. No, she did not. 20 Q. What were the sources of the income listed on line 7? 21 If you could just restore the document, Mr. Turk. 22 A. That would be W-2 salary. 23 Q. Did you receive W-2s equaling an amount of the $101,574? 24 A. Yes, I did. 25 Q. Please turn to page 1 of 620. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2025 C36Qann5 Rocco - direct 1 Mr. Rocco, what, if any, obligation does a return 2 preparer have to audit a return of a taxpayer? 3 A. There is no obligation to audit the return. You just have 4 an obligation to prepare the return to the best of your 5 ability. 6 Q. Now, when you prepare a return, what do you do with it 7 after you prepare it? 8 A. Either the client picks it up or we mail it to the client. 9 Q. Do you enclose any correspondence? 10 A. We have a cover sheet. 11 Q. And page 1, is that the cover sheet that was submitted -- 12 A. Yes, it is. 13 Q. -- along with Ms. Annabi's 2004 return? 14 A. Yes, it is. 15 Q. Please Mr. Turk, would you maximize paragraph one. 16 Mr. Rocco, could you please read the first paragraph? 17 A. Dear Sandy: We have prepared the enclosed returns from 18 information provided by you without verification or audit. We 19 suggest that you examine these returns carefully to fully 20 acquaint yourself with all items contained therein to ensure 21 that there are no omissions or misstatements." 22 MR. CARBONE: Thank you, Mr. Rocco. No further 23 questions. 24 THE COURT: Mr. Aronwald. 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2026 C36Qann5 Rocco - direct 1 CROSS-EXAMINATION 2 BY MR. ARONWALD: 3 Q. Mr. Rocco, if I heard your testimony correctly, you 4 prepared a return for 2004 for Ms. Annabi? 5 A. Yes. 6 Q. She did not file that return, correct? 7 A. I have no knowledge of that. 8 Q. OK. You never were advised by her that she had filed a 9 return that you prepared, correct, for 2004? 10 A. I mailed her the return or she picked it up. What she did 11 with it, I have no knowledge of. 12 Q. Now, Mr. Carbone asked you some questions. 13 Can we have the return Government Exhibit 607 put back 14 up, please? The first page of the return. Would you please 15 magnify or highlight the line, line 7. 16 Now, in layman's terms, line 7 concerning wages, 17 salaries, tips, etc., that refers to income, correct? 18 A. That generally refers to W-2 income. 19 Q. And then the line above it that you were -- the line that 20 you were showed which asks for other income -- 21 A. Yes. 22 Q. Could we have that line also, the line above it -- I'm 23 sorry. 24 A. I believe you're referring to line 21. 25 Q. Line 21, yes. Thank you. So line 21 is income other than SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2027 C36Qann5 Rocco - Cross 1 W-2 income, correct? 2 A. Yes. 3 Q. Tell the jury, please, what is income? 4 A. Income is a very broad concept. The Code, the Internal 5 Revenue Code, provides that everything is income unless the 6 Code excludes it. 7 Q. Among the items that are excluded as income, are gifts 8 included as items that are excluded from income? 9 A. No. Bona fide gifts are not income. 10 Q. What about loans, are loans excluded as income? 11 A. Bona fide loans are not income. 12 Q. OK. So if someone receives a gift or obtains a loan, that 13 is not considered income and need not be reported on the income 14 tax return, is that correct? 15 A. That's correct. 16 Q. OK. That was true when you prepared the return for 17 Ms. Annabi in the year 2003? 18 A. What was true? 19 Q. That bona fide gifts and loans were not reportable as 20 income? 21 A. Yes, that was the law in 2003. If you're saying that was 22 the law, that's the law in 2003 as it is now. 23 Q. And it was also the law in 2004, correct? 24 A. Yes, it is. 25 Q. Now, what you asked Ms. Annabi was to explain to you SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2028 C36Qann5 Rocco - Cross 1 whether or not she had any other income other than the W-2 2 income, correct? 3 A. Yes. 4 MR. ARONWALD: Thank you, no further questions. 5 MR. SIANO: No questions. 6 THE COURT: Thank you, Mr. Siano. 7 MR. SIANO: You're welcome, your Honor. 8 MR. CARBONE: May I, your Honor? 9 THE COURT: You may. 10 REDIRECT EXAMINATION 11 BY MR. CARBONE: 12 Q. Mr. Rocco, you said that a bona fide gift is not income, is 13 that correct? 14 A. That's correct. 15 Q. Can you tell the jury what the definition of a gift is? 16 A. Well, a gift is something that's received based on 17 generosity and without any consideration. 18 Q. If someone receives a financial benefit that's made, at 19 least in part, for the purpose of influencing or rewarding that 20 person for official action, would that be a bona fide gift? 21 A. No, I would not say that would be a bona fide gift. 22 MR. CARBONE: Thank you. 23 THE COURT: Anything else? 24 MR. ARONWALD: Nothing else, your Honor. 25 THE COURT: Thank you so much, Mr. Rocco. You may SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2029 C36Qann5 Rocco - Redirect 1 step down. 2 (Witness excused) 3 THE COURT: Call your next witness. 4 MR. CARBONE: The government calls Carl Maniscalco. 5 CARL MANISCALCO, 6 called as a witness by the Government, 7 having been duly sworn, testified as follows: 8 DIRECT EXAMINATION 9 BY MR. CARBONE: 10 THE DEPUTY CLERK: Tell us your full name, and spell 11 your last name. 12 THE WITNESS: My name is Carl Maniscalco, 13 M-A-N-I-S-C-A-L-C-O. 14 THE COURT: You may inquire. 15 MR. CARBONE: Thank you. 16 Q. Good afternoon, Mr. Maniscalco. Sir, are you where are you 17 employed. 18 A. The city of Yonkers. 19 Q. What is your job Title? 20 A. I'm the budget director. 21 Q. How long have you been the budget director in the city of 22 Yonkers? 23 A. Since March '91, 21 years. No, I'm sorry, I've been the 24 budget director since 2000. 25 Q. What other positions have you held with the city of SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2030 C36Qann5 Maniscalco - Direct 1 Yonkers? 2 A. Junior auditor, budget analyst, associate budget director 3 and budget director and the commissioner of finance. 4 Q. What are your job duties as the budget director? 5 A. To facilitate budget package, to review revenues and 6 expenditures, to prepare the budget for the executive. 7 Q. Were you involved in the budget approval process between 8 the years 2002 and 2008? 9 A. Somewhat, yes. 10 Q. Can you briefly describe the budget approval process? 11 A. The finance department sends out a package to the 12 departments in December. January the departments submit their 13 budget requests, and then February we hold meetings with those 14 departments. In March, we assemble and formulate the budget. 15 The mayor makes his priorities, and by April 15 the executive 16 budget is announced to the council by the mayor. 17 Q. Does the city council vote on the final budget? 18 A. City council votes on the budget. During May they hold 19 their own hearings with the departments. And then sometime in 20 June they vote on the budget to be enacted for July 1. 21 Q. What was your role in the budget process? 22 A. Again, I sit on the meetings in February with the 23 departments. I review the departmental requests. I prepare 24 all the documents for the executive budget and the actual 25 budget document. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2031 C36Qann5 Maniscalco - Direct 1 Q. What are the sources of funding used by the city of Yonkers 2 to fund government operations? 3 A. We have municipal aid from New York State. We have fees 4 that we charge for parks, parking violation fees, housing and 5 building fees, taxes, obviously. 6 Q. What, if any, federal funding does the city of Yonkers 7 receive? 8 A. The city receives numerous grants from the federal 9 government. We receive about three or four different grants. 10 They total $5- or $6 million on average. 11 Q. Per year? 12 A. Yes. 13 Q. Does the city of Yonkers create any documents reflecting 14 the annual budget and sources of funds? 15 A. Yes. We have a revenue section in the budget document. 16 Q. Mr. Turk, could you please broadcast Government Exhibit 30 17 in evidence and maximize the top half of the page. 18 Mr. Maniscalco, what is Government Exhibit 30? 19 A. This is a page from our grant section in the budget. 20 Q. What year does it relate to? 21 A. Year 2002. 22 Q. Can you please tell the jury what those first two line 23 items under planning and development reflect? 24 A. The first line is a home program. It goes to fund housing 25 projects, housing development. That's a federal program. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2032 C36Qann5 Maniscalco - Direct 1 CD block grant is a federal program also that we 2 receive to fund numerous different activities, affordable 3 housing issues, activities in blighted areas. 4 Q. Can you tell the jury the approximate total from those two 5 programs that the city of Yonkers receives? 6 A. $6.5 million. 7 Q. Mr. Turk, could you restore the document and maximize the 8 bottom of the page where it says police department. 9 Any federal funding reflected in those line items? 10 A. Public housing grant, federal forfeiture program, public 11 housing drug elimination grant, MHA Security. 12 Q. Mr. Turk, could you please turn to page 2. Maximize the 13 top part of the page where it says police department. 14 What is a cop grant? 15 A. The cops more grant. The cops more grant, I believe, is 16 another federal grant. It's to hire police officers. 17 Q. Is the education budget broken out differently than the 18 general operating budget of the city? 19 A. Yes. 20 Q. Please broadcast Government Exhibit 30-A in evidence. 21 Mr. Turk, if you could, maximize the line that says federal 22 aid. It's about ten lines up from the bottom. 23 How much federal aid is reflected there? 24 A. For the 2002 budgets year, it looks like $620,000. 25 Q. And did the city of Yonkers receive similar amounts of SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2033 C36Qann5 Maniscalco - Direct 1 federal funding from year to year up through 2008? 2 A. Yes. 3 Q. Mr. Turk, please broadcast Government Exhibit 31. 4 Approximately how much federal funding did the city of 5 Yonkers receive under the home program and block grant program? 6 A. $5.9 million. 7 Q. What year is that for? 8 A. 2003. 9 Q. Would you please broadcast Government Exhibit 31-A. 10 Maximize the federal aid line, which is about ten up from the 11 bottom. 12 How much federal aid did the city of Yonkers receive 13 in connection with education? 14 A. Again, the federal aid is $620,000. 15 Q. Please broadcast Government Exhibit 32. 16 What year does this budget report relate to? 17 A. 2004. 18 Q. How much did the city of Yonkers receive? If you would, 19 Mr. Turk, just please maximize the first couple lines of 20 planning and development. 21 In 2004, how much approximately did the city of 22 Yonkers received under those two programs alone? 23 A. Approximately $7.4 million. 24 Q. Please broadcast Government Exhibit 32-A. 25 In the 2004 year, how much federal aid in connection SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2034 C36Qann5 Maniscalco - Direct 1 with education? 2 A. $980,000. 3 Q. Please broadcast Government Exhibit 33. Maximize the 4 planning and development section. 5 How much federal aid in 2005? 6 A. 2005, $8 million. 7 Q. Please broadcast Government Exhibit 33 A. Mr. Turk, could 8 you maximize the line that says federal aid. 9 Now, in connection with education, how much direct aid 10 did the city of Yonkers receive from the federal government? 11 A. $3.1 million. 12 Q. Please broadcast Government Exhibit 34. Maximize the 13 planning and development section. 14 How much direct federal aid did the city of Yonkers 15 receive under the home and block grant programs? 16 A. $7.2 million. 17 Q. Please broadcast Government Exhibit 35. Maximize the 18 planning and development section again. 19 In 2007, approximately how much federal aid in 20 connection with those programs? 21 A. $6.6 million. 22 Q. Broadcast Exhibit 35-A. If you would just maximize the 23 federal aid line. 24 How much direct federal aid in 2007? 25 A. $3 million. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2035 C36Qann5 Maniscalco - Direct 1 Q. Please broadcast Government Exhibit 36. And maximize the 2 planning and development section. 3 Approximately how much federal aid did the city of 4 Yonkers receive in connection with the two grants in 2008? 5 A. $6.8. 6 Q. Please broadcast Government Exhibit 36-B. I'm sorry, 36-A. 7 Read for us how much direct federal aid the city of 8 Yonkers received for education in 2008? 9 A. $3.2 million. 10 Q. Does the city of Yonkers also receive something called 11 indirect funding from the federal government? 12 A. There could be pass-throughs that come from New York State 13 from the federal government to the city of Yonkers. 14 MR. CARBONE: Thank you. 15 No further questions. Thank you. 16 MR. ARONWALD: No questions. 17 MR. SIANO: No questions, your Honor. 18 THE COURT: Thank you, sir. You may step down. 19 (Witness excused) 20 THE COURT: Do you guys need a break? I think I have 21 to give the lawyers a break. They didn't take a break when you 22 took a break. 23 Five minutes. Don't discuss the case. Keep an open 24 mind 25 (Recess) SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2036 C36Qann5 Maniscalco - Direct 1 (Jury not present) 2 THE DEPUTY CLERK: These are people from the 3 University of Paris. 4 THE COURT: Good afternoon to our visitors, who I 5 understand are from the University of Paris. (Speaks French) 6 All right. So where is Mr. Carbone? 7 MR. HALPERIN: He is getting something for the Court, 8 Judge. 9 THE COURT: Can you do this? 10 MR. HALPERIN: We can. 11 THE COURT: You can do this by yourself? 12 MR. HALPERIN: We can. I'm ready. 13 THE COURT: Call your next witness. 14 MR. SIANO: Judge, for the record, I want to reflect 15 that I am doing this without Ms. Gallego. 16 THE COURT: You don't have to do it yet. You just 17 have to sit and listen first. 18 MR. HALPERIN: Do you want the jury out? 19 THE COURT: The jury would be a good thing. 20 THE DEPUTY CLERK: Stalling here. 21 THE COURT: Don't stall. Just bring in the jury. 22 (Continued on next page) 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2037 C36Qann5 Maniscalco - Direct 1 (Jury present) 2 THE COURT: All right. Let's all have a seat. 3 Mr. Halperin, call your next witness. 4 MR. HALPERIN: Your Honor, the government calls Maria 5 Chousa. 6 MARIA CHOUSA, 7 called as a witness by the Government, 8 having been duly sworn, testified as follows: 9 DIRECT EXAMINATION 10 BY MR. HALPERIN: 11 THE DEPUTY CLERK: Tell us your name, spell your last 12 name. 13 THE WITNESS: Maria Chousa, C-H-O-U-S-A. 14 THE COURT: You may inquire. 15 MR. HALPERIN: Thank you very much, your Honor. 16 BY MR. HALPERIN: 17 Q. Good afternoon, Ms. Chousa. 18 A. Good afternoon. 19 Q. Ms. Chousa, what county do you live in? 20 A. Westchester. 21 Q. Where do you work? 22 A. I work for reinsurance company in Armonk. 23 Q. What's your position there? 24 A. I'm an executive assistant. 25 Q. How far did you go in school? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2038 C36Qann5 Chousa - Direct 1 A. Associate's degree. 2 Q. Do you know someone named Sandy Annabi? 3 A. I do. 4 Q. About when did you first meet Sandy Annabi? 5 A. The beginning of the early Nineties. 6 Q. How did you first meet her? 7 A. I met her through a friend of mine that I went to school 8 with. 9 Q. From the time you met Sandy Annabi in the 1990s to about 10 2005, how would you describe your relationship with Sandy 11 Annabi? 12 A. We were very good friends. 13 Q. During this time, what types of occasions would the two of 14 you see each other? 15 A. We would go on vacation together. We would go out to 16 dinner. We hung out pretty much a lot during the week. 17 Q. When you say a lot, give the jury a sense of how many times 18 a month you would see each other? 19 A. Well, in a week, maybe like, you know, three times a week; 20 on the weekend almost every weekend. 21 Q. Do you see the person you've been referring to as Sandy 22 Annabi here in the courtroom today? 23 A. I do. 24 Q. Please point to her and state where she is sitting? 25 A. She is standing right over there -- sitting right over SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2039 C36Qann5 Chousa - Direct 1 there. 2 Q. The front or back table? 3 A. Back table. 4 THE COURT: Indicating Ms. Annabi. 5 Q. Ms. Chousa, do you know someone named Zehy Jereis? 6 A. I do. 7 Q. Have you seen him on numerous occasions? 8 A. When Sandy and I would go out to dinner, he would come once 9 in awhile. 10 Q. Do you see the person you've been referring to as Zehy 11 Jereis here in the courtroom? 12 A. I do. 13 Q. Please point to him. 14 A. Over there. 15 THE COURT: Indicating Mr. Zehy Jereis. 16 Q. Now, let me direct your attention to approximately 2001. 17 At around this time, did Sandy Annabi tell you she was going to 18 run for political office? 19 A. She never mentioned anything in the beginning until she was 20 going into the elections. She never mentioned anything that 21 she was interested in. 22 Q. What, if anything, did she say to you about whether she was 23 going to run for office at that time in 2001? 24 A. She didn't say anything until she ran for office. 25 Q. At that point what did she say to you? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2040 C36Qann5 Chousa - Direct 1 A. That she was going to run for city council in Yonkers. 2 Q. Before that time in 2001, what, if any, interest had she 3 expressed to you about going into politics? 4 A. Nothing. 5 Q. In 2001, who, if anyone, did Ms. Annabi introduce you to 6 whom she said would help with her campaign? 7 A. Zehy Jereis. 8 Q. You're referring to Zehy Jereis, the defendant? 9 A. Correct. 10 Q. How did she introduce Mr. Jereis to you? 11 A. She said that he was a distant cousin, and that he was 12 going to help her in her campaigning when she was going to run 13 for city council. 14 Q. What did she say his role would be in her campaign? 15 A. He was going to be like her adviser. 16 Q. Now, had you ever met Mr. Jereis before? 17 A. No. 18 Q. Before you met Mr. Jereis in 2001, what, if anything, had 19 Ms. Annabi said to you before about Mr. Jereis? 20 A. She never mentioned anything. 21 Q. Before that time, when, if ever, had she mentioned his name 22 to you? 23 A. That they were cousins maybe? 24 Q. Before 2001, you don't recall -- 25 A. No. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2041 C36Qann5 Chousa - Direct 1 Q. -- any conversation? 2 A. No, because I hadn't -- yeah, I never met him before. 3 Q. Now, let me direct your attention again to 2001. During 4 that political campaign season, did you have any dinners or 5 meals with both Mr. Annabi and Mr. Jereis? 6 A. Mmm-hmm. We did, yes. 7 Q. Just for the record, I need a yes or a no from you. 8 A. Yes. 9 Q. Thank you. What was discussed at those meetings or meals 10 with Annabi and Jereis? 11 A. A lot of political things. He would tell her, you know, 12 you'd have to go -- this is, you know, what you should do when 13 you're campaigning, you should go to this building, you should 14 go -- you know, he was just basically telling her how to 15 campaign and where to go and what to do. 16 Q. How often, as far as you could tell, would Annabi follow 17 Mr. Jereis's political advice? 18 A. She would. She would go to the buildings and she would go, 19 you know, door-to-door, and she would basically do what he 20 said. 21 Q. Now, let me direct your attention to 2001 through 2005. On 22 what, if any, occasions were you with Ms. Annabi and Mr. Jereis 23 at the same time? 24 A. Well, every time we'd go out to dinner, he would show up, 25 so, you know, we went out to dinner at least once a week or -- SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2042 C36Qann5 Chousa - Direct 1 but he did show up pretty much when we were together. 2 Q. Now, just to be clear, I think you said every time you'd go 3 out to dinner. Would he show up every single time? 4 A. Almost every time, yes. 5 Q. When you saw and heard them interact, what types of things 6 would they discuss? 7 A. Just politics. Political things. Again, you know, what 8 she should do and -- it was never anything else other than 9 political stuff. 10 Q. What, if anything, did you hear Mr. Jereis during these 11 occasions tell Ms. Annabi about how to go about campaigning? 12 A. He would tell her, you know, you should go door-to-door, 13 you should go to this building, you should -- you know, just 14 basically where she should go, how she should do it, you know, 15 knock on the door and introduce yourself, etc., things like 16 that. 17 Q. When you say "go to this building," you mean what exactly, 18 to meet voters? 19 A. To meet voters. 20 Q. Now, what, if anything, do you know about whether Annabi 21 and Jereis ever had a romantic relationship? 22 A. No. 23 Q. Why do you say that? 24 A. Because he's not her type. 25 Q. Who said that? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2043 C36Qann5 Chousa - Direct 1 A. She said that. 2 Q. She said he's not her type. When Mr. Jereis showed up on 3 these many occasions when the two of you were going out or 4 having dinner, what, if anything, did Ms. Annabi say to you 5 about why he was showing up so frequently? 6 A. Just basically, you know, he was going to help her with 7 campaigning and things like that. 8 Q. Now, again, focusing on the 2001 to 2005 time frame, 9 roughly how often would you socialize with Ms. Annabi? 10 A. Almost every week, you know, maybe two, three times a week. 11 We would see each other on weekends go out every weekend, so it 12 was pretty often. 13 Q. Without getting into details, what, if anything, would 14 Ms. Annabi tell you about anybody else she had dated or had 15 been dating? 16 A. There was one person that she would see, you know, and 17 there was another one towards -- towards the end. 18 Q. When you say the end -- 19 A. Towards the end of our -- 20 Q. Let me finish, from 2001 to 2005 time frame. 21 A. Yeah, towards like -- around the 2005 area. 22 Q. OK. 23 A. Middle to the end. There was one person that she said she 24 was seeing. 25 Q. On how many occasions, if any, did Ms. Annabi mention SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2044 C36Qann5 Chousa - Direct 1 Mr. Jereis in a romantic context? 2 A. She never did. 3 Q. Now, directing you to 2001, did Ms. Annabi ask you to work 4 on her campaign committee? 5 A. Yes, she did. 6 Q. What position did she ask you to take? 7 A. She asked me if I would be her treasurer. 8 Q. Campaign treasurer? 9 A. Campaign treasurer. 10 Q. Did you agree? 11 A. I did. 12 Q. What, if anything, did Ms. Annabi say was the reason she 13 asked you to be a treasurer? 14 A. Because I was a friend and she trusted me. 15 Q. Were you paid for your service? 16 A. No, I was not. 17 Q. Roughly what years did you serve as her campaign treasurer? 18 A. From 2001 until 2005, early 2005. 19 Q. What did Ms. Annabi tell you your role would be or what it 20 would entail as campaign treasurer? 21 A. Just verify that everything that she put on the forms were 22 correct. 23 Q. Once you became treasurer, who handled the check 24 preparation and paperwork? 25 A. She did. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2045 C36Qann5 Chousa - Direct 1 Q. Who signed the checks for the campaign committee? 2 A. She did. 3 Q. Now, you said that you stopped serving as her campaign 4 treasurer in approximately 2005. What happened at that point? 5 A. We just had a falling out. 6 Q. Let me now show you Government Exhibit 1218. 7 MR. HALPERIN: Your Honor, may I approach? 8 THE COURT: You may. 9 Q. Ms. Chousa, do you recognize that document? 10 A. May I get my glasses? 11 THE COURT: You may get your glasses. Funny you 12 should mention that today. 13 A. Yes, I do recognize this. 14 Q. What do you recognize this to be? 15 A. It's a letter from myself resigning as treasurer. 16 Q. Treasurer of what? 17 A. Treasurer of, it says here, Friends of Sandy Annabi, 18 committee -- political campaign committee of Friends of Sandy 19 Annabi. 20 Q. What's the date of this letter? 21 A. January 10, 2006. 22 MR. HALPERIN: Your Honor, the government offers 23 Government Exhibit 1218. 24 MR. ARONWALD: No objection. 25 MR. SIANO: No objection. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2046 C36Qann5 Chousa - Direct 1 THE COURT: Admitted. 2 (Government's Exhibit 1218 received in evidence) 3 Q. Mr. Turk, can you please display 1218. 4 Ms. Chousa, now that we have it up on the screen give 5 me the date again, please. 6 A. January 10, 2006. 7 Q. Who did you send this letter to? 8 A. Sandy Annabi. 9 Q. What care of line? 10 A. Friends of Sandy Annabi. 11 Q. And the address? 12 A. 245 Rumsey Road, Apartment 1B, Yonkers, New York, 10701. 13 Q. Please read the text of the letter aloud. 14 A. I, Maria Chousa, residing at Ossining, New York, 10562, 15 resign as treasurer effective October 30 of 2005 from the 16 political campaign committee Friends of Sandy Annabi. 17 Q. Did you sign that letter? 18 A. I did. 19 Q. Why did you put the effective date of October 30, 2005? 20 A. That's the date that I was told to put. 21 Q. By whom? 22 A. By Sandy. 23 Q. Thank you. You can put that down. 24 Let me direct your attention to the summer of 2004. 25 What, if any, properties did Sandy Annabi buy in Yonkers at SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2047 C36Qann5 Chousa - Direct 1 this time? 2 A. There was a house -- there was two houses, actually, that 3 she bought. 4 Q. Do you recall what streets they were located on? 5 A. One was on Patton, and the other one was down the street on 6 Bacon. 7 Q. You said these were houses? 8 A. Yes. 9 Q. Were they single-family residences? 10 A. Yes. 11 Q. What neighborhood in Yonkers were they in? 12 A. I believe -- they were in North Yonkers by Nathan's, 13 Central Avenue, Nathan's area. 14 Q. How close were the two houses to each other? 15 A. About a block or two. 16 Q. How would you describe the neighborhood there? 17 A. Very nice neighborhood. 18 Q. Did you speak to Ms. Annabi about her purchase of these two 19 houses? 20 A. No, I just found out after she moved in. 21 Q. After she moved in, did you have any discussion about her 22 purchase of the two houses? 23 A. She said that she had bought -- she said she had looked 24 into the house on Patton, but then they saw the one on Bacon 25 that was nicer, and something about they lost the deposit on SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2048 C36Qann5 Chousa - Direct 1 the house on Patton and then they moved in immediately into the 2 one on Bacon. 3 Q. What, if anything, did Ms. Annabi tell you about whether 4 she ever lived in a property on Patton Street? 5 A. She didn't. 6 Q. Do you know if anyone in her family did for any period of 7 time? 8 A. I remember her saying that her older brother was staying in 9 there, they were afraid that somebody would try to break into 10 the house so he was staying inside the house. 11 Q. For roughly how long a time period? 12 A. Roughly a month or two, I'm not quite sure. 13 Q. What was her older brother's name? 14 A. Samir. 15 Q. And her other brother? 16 A. Frankie. 17 Q. After Ms. Annabi bought house on Bacon Place, who moved 18 into it? 19 A. The whole family did. 20 Q. Who does that include? 21 A. Her mom and dad, her two brothers and Sandy. 22 Q. How do you know that? 23 A. Because I would go there and pick her up whenever we would 24 go out, so I would see the whole family there. 25 Q. Where had Ms. Annabi been living before moving to Bacon SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2049 C36Qann5 Chousa - Direct 1 Place? 2 A. She was on Linden Street. 3 Q. Do you remember what the address was on Linden Street? 4 A. I believe it was 51 Linden Street. 5 Q. What types of residence was the building at 51 Linden 6 Street? 7 A. It was a small apartment building. I think it was two 8 floors maybe like a four or five-family type building. 9 Q. She lived in an apartment there? 10 A. Yes. 11 Q. How often did you visit her at the apartment at 51 Linden 12 Street? 13 A. Pretty often. 14 Q. Would you say more than 20 times -- 15 A. Yes, definitely. Because every time we went out, I would 16 always go there to pick her up. 17 Q. Who did she live with at the apartment at 51 Linden Street? 18 A. Her mom, dad, brothers. 19 Q. Now, when, if ever, did Ms. Annabi live at 53 Linden 20 Street, the apartment building next door? 21 A. I don't recall her living in 53. I know her aunts lived in 22 53; that's right next door. 23 Q. When you say you don't recall, do you know if she ever did? 24 A. I don't believe she ever did, no. 25 Q. Do you know someone named Randa Rabadi? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2050 C36Qann5 Chousa - Direct 1 A. Randa, yes. 2 Q. Who is that? 3 A. I think that's her mom's sister. 4 Q. So Sandy's aunt? 5 A. Sandy's aunt. 6 Q. Now, at some point, did Ms. Sandy Annabi buy a house on 7 Rumsey Road in Yonkers? 8 A. She did. 9 Q. What type of building was that on Rumsey Road? 10 A. It was a high-rise apartment building. 11 Q. She bought an apartment there? 12 A. Yes. 13 Q. How many times did you go inside the Rumsey Road apartment 14 roughly? 15 A. Maybe two or three, four times maybe. 16 Q. Roughly how often after Ms. Annabi bought the house at 17 Bacon Place did she buy the apartment on Rumsey Road? 18 A. Within maybe six months afterwards. 19 Q. What, if anything, did Ms. Annabi tell you about why she 20 bought the Rumsey Road apartment? 21 A. She needed to live -- she needed to have a place in the 22 district that she represented. 23 Q. What, if anything, do you know about whether 51 Linden 24 Street was in Ms. Annabi's council district? 25 A. Yes, that's part of South Yonkers, and that's what she SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2051 C36Qann5 Chousa - Direct 1 represented was South Yonkers. 2 Q. What do you know about whether 45 Bacon Place was in her 3 city council district? 4 A. It wasn't. 5 Q. What about 13 Patton? 6 A. No. 7 Q. Now, after Ms. Annabi bought the apartment on Rumsey Road, 8 in roughly 2005, early 2005, what was your understanding about 9 where Ms. Annabi was living? 10 A. She was living on Bacon. 11 Q. Why do you say that? 12 A. She -- all her clothes were there. Whenever we would go 13 out, I would pick her up there. 14 Q. OK. Let me direct your attention to a period of, let's 15 say, February through October of 2005. During this time frame, 16 roughly how often would you see Ms. Annabi? 17 A. On the weekend whenever we would go out. 18 Q. Whose car would you usually take when you would go out? 19 A. Mine. 20 Q. Who would pick whom up when you would go out? 21 A. I would pick her up. 22 Q. Now, after Ms. Annabi bought the apartment on Rumsey Road, 23 often how often would you pick her up at the Rumsey Road 24 apartment and how often would you pick her up at the Bacon 25 Place apartment? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2052 C36Qann5 Chousa - Direct 1 A. I would pick her up more at Bacon Place. I only went to 2 the Rumsey Road maybe like a handful of times, maybe like four 3 times. I wasn't there very many times. 4 Q. Where would you usually drop her off at night? 5 A. Bacon. 6 Q. Now, after Ms. Annabi bought house on Bacon Place in 2004, 7 roughly how often would you visit her at that house? 8 A. Again, whenever we would go out, on the weekend, which we 9 pretty much saw each other on the weekend. 10 Q. Approximately how many times did you go inside her house at 11 Bacon Place? 12 A. Almost every time I went to pick her up. 13 Q. Please describe for the jury the inside of the house. 14 A. You walk in and to the right there was a living room, 15 dining room, and then there was a kitchen in front and there 16 was stairs going up. There was bedrooms upstairs, and then 17 there was a few stairs going down that was like a small den, 18 and then there was another -- a few other steps, and then there 19 was a kitchen-type area downstairs. 20 Q. In the upstairs, how many bedrooms were there? 21 A. There were three bedrooms. 22 Q. Whose rooms were upstairs? 23 A. Sandy's, her parents', and Frankie's. 24 Q. Frankie is one of her brothers? 25 A. One of her brothers. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2053 C36Qann5 Chousa - Direct 1 Q. Where did the other brother sleep? 2 A. Downstairs in that small den area. 3 Q. Who had the biggest bedroom in the house? 4 A. Sandy's. 5 Q. Now, let me direct your attention to 2005. What, if 6 anything, do you know about whether Annabi started driving a 7 new car at this time? 8 A. She did. 9 Q. What type of car? 10 A. Mercedes. 11 Q. What, if anything, did she tell you about the price of the 12 car? 13 A. It was a pretty expensive car, maybe like a $60,000 car. 14 Q. What, if anything, did Ms. Annabi tell you about whether 15 Mr. Jereis had made the down payment for the Mercedes Benz? 16 A. She didn't mention anything. 17 Q. What, if anything, did Ms. Annabi tell you about whether 18 Jereis had helped her buy the house on Bacon Place, the house 19 on Patton, or the apartment on Rumsey Road? 20 A. She never did. 21 Q. Mr. Turk, please display Government Exhibit 1203 which has 22 been received into evidence as part of Government Exhibit 173. 23 Let's blow up the top half of the document, please. 24 Ms. Chousa, what does it say at the top of the document? 25 A. Committee to elect Sandy Annabi. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2054 C36UANN6 Chousa - direct 1 Q. And under signature of signer, what is the first name 2 listed? 3 A. Maria Chousa. 4 Q. And what is the title? 5 A. Treasurer. 6 Q. Is that your signature? 7 A. No. 8 Q. Did you sign this document? 9 A. I did not. 10 Q. Do you recognize this handwriting? 11 MR. ARONWALD: Your Honor, may we have a sidebar, 12 please? 13 THE COURT: No. 14 Q. Do you recognize the handwriting? 15 A. It looks like Sandy's handwriting. 16 Q. You are not a handwriting expert? 17 A. I am not, but I know that is not my signature. 18 Q. How often did you see Ms. Annabi's handwriting during the 19 course of your friendship? 20 A. We were friends for a few years so, yes, I remember 21 receiving birthday cards from her so I recognize her 22 handwriting. 23 Q. And whose name is underneath yours as a signer too? 24 A. Sandy Annabi. 25 Q. Can you read whose name is on line 4? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2055 C36UANN6 Chousa - direct 1 A. No, I can't. 2 Q. At the bottom of the top part of the page next to the X, 3 whose name is signed? 4 A. Maria Chousa. 5 Q. Is that your signature? 6 A. No, it is not. 7 Q. Whose handwriting does that appear to be? 8 A. It is not mine. 9 Q. Did you give anyone authority to sign your name? 10 A. No, I did not. 11 Q. And what does it say on the line above your signature at 12 the bottom of the page starting with the word "signature" in 13 all caps? 14 A. It says: "I certify under penalty of perjury the 15 statements checked in this section." 16 Q. What is the address listed, the home address underneath 17 your name there? 18 A. 51 Linden Street, Yonkers. 19 Q. Did you ever reside at that address? 20 A. No, I did not. 21 Q. Who do you know who lived at 51 Linden Street? 22 A. Sandy did and her family. 23 MR. HALPERIN: Mr. Turk could we have the bottom of 24 the page. 25 MR. ARONWALD: Your Honor, I need a sidebar, please. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2056 C36UANN6 Chousa - direct 1 (At the sidebar) 2 MR. ARONWALD: I had a conversation with Mr. Carbone 3 about the signing of these documents which I viewed as 404(b) 4 evidence which was never raised. And Mr. Carbone told me this 5 morning that they were not going to go into this, that what 6 they were going to do was focus the question on where 7 Ms. Annabi was living. The fact of the matter is that this is 8 404(b). If you read the grand jury -- which I didn't receive 9 until Thursday of last week which was contrary to your Honor's 10 ruling about it being provided a week in advance, so I first 11 got a chance to review it this morning in the car on the way 12 down here. I spoke to Mr. Carbone and I told him that I 13 thought that this was 404(b) evidence. And he agreed, and they 14 were limiting their questions to basically their questioning 15 about the relationship with Sandy about the political 16 campaigning -- 17 THE COURT: Hang on. 18 Why isn't this 404(b). 19 MR. HALPERIN: First of all, I told Mr. Aronwald -- 20 THE COURT: I don't care about the conversation. I am 21 not interested in wasting the jury's time while you guys -- 22 MR. HALPERIN: I have a few more questions for the 23 witness. 24 THE COURT: My question is, is it 404(b)? 25 MR. HALPERIN: It is not. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2057 C36UANN6 Chousa - direct 1 THE COURT: Why? 2 MR. HALPERIN: Because it goes directly to 3 Ms. Annabi's control over her campaign committee and the nature 4 of their relationship. 5 THE COURT: The nature of their relationship, she is 6 not accused of conspiring with her. The nature of their 7 relationship is not in dispute. What does the control of the 8 campaign committee have to do with anything? 9 MR. HALPERIN: Because in this case there are issues 10 with Ms. Annabi signing documents. 11 THE COURT: Tell me what those issues are. I don't 12 know what those issues are. 13 MR. CARBONE: Your Honor's 404(b) ruling was that if 14 and when Ms. Annabi's places her intent in issue -- 15 THE COURT: This was not disclosed as 404(b) evidence. 16 It was not. So if this is not 404(b) evidence, you have to 17 explain to me why it is not, otherwise, I am striking the whole 18 thing. 19 MR. HALPERIN: It is not 404(b) evidence because it 20 goes to Ms. Annabi's control over financing over the campaign 21 account. 22 THE COURT: What does the campaign account have to do 23 to with this case? As I understood it, it was about her 24 Mercedes, her rent, her student loans -- 25 MR. ARONWALD: The question was whether or not -- SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2058 C36UANN6 Chousa - direct 1 (In open court) 2 THE COURT: I am sorry, people. I really am. 3 Don't discuss the case. Keep an open mind. 4 I can't do it. I'm sorry. 5 (Jury not present) 6 (Witness not present) 7 THE COURT: I want to make it clear that I am not 8 interested in discussing who said what to whom this morning. 9 The issue on the table is whether this evidence is 10 direct evidence of any of the crimes charged or whether it is 11 404(b) evidence which should have been specifically disclosed 12 by a date well in advance of the trial. I can honestly say, 13 having made the 404(b) ruling, that I was not aware of any 14 evidence tending to suggest that Ms. Annabi had forged a 15 signature on any document. That was not specifically disclosed 16 by the government. So nothing in my 404(b) ruling could 17 possibly have addressed this issue. 18 Now that we have gotten that on the table, Mr. 19 Halperin, tell me what count this is relevant to and how it is 20 relevant. 21 If you guys are having a discussion about this now, I 22 am a little nervous. It seems to me you ought to know. 23 MR. HALPERIN: Judge, we think it goes and it is 24 relevant to the issue of the relationship between Ms. Chousa 25 and Ms. Annabi. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2059 C36UANN6 Chousa - direct 1 THE COURT: Well, the relationship between Ms. Chousa 2 and Ms. Annabi is not an issue in this case. 3 MR. HALPERIN: First of all, Judge, arguably, it is -- 4 THE COURT: And forging a document behind a witness's 5 back does not explain the relationship between them. The 6 relationship between them was explained by the witness. They 7 are friends, and Ms. Chousa was at one time Ms. Annabi's 8 campaign treasurer, a job she tells us she ceased to occupy 9 after a certain time. That is the relationship. 10 MR. HALPERIN: Judge, we also think it pertains to 11 Ms. Annabi's control and how involved she is with her campaign 12 committee's finances -- 13 THE COURT: And how is that relevant to any of the 14 charges? Please go count by count in this case. 15 What does it have to do with her alleged conspiracy 16 with Mr. Jereis to give her gifts in order to have her on the 17 payroll -- in quotes, as it were -- or the alleged conspiracy 18 relating to Longfellow which involved the transfer of money 19 from the Milios through Mr. Mangone. And those are the bribes 20 that are part of the bribery count. And those are the corrupt 21 payments that are part of the corrupt payments counts. It 22 doesn't have anything to do with her tax return. It doesn't 23 have anything to do with her mortgage application. 24 So please explain to me why it is that her control 25 over her own campaign finance committee, to which, as far as I SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2060 C36UANN6 Chousa - direct 1 know, Mr. Jereis is not alleged to have contributed largess is 2 at issue in this case. 3 MR. HALPERIN: Judge, we think the principal reason is 4 because it does show the nature of their relationship. 5 THE COURT: Whose? Mr. Jereis's and Ms. Annabi's? 6 MR. HALPERIN: No. The witness's and Ms. Annabi's. 7 THE COURT: But why is the witness's relationship to 8 Ms. Annabi of any relevance here at all? That is what I don't 9 understand. You don't get to get all kinds of evidence in as 10 "direct evidence" -- it has to be direct evidence of the crime, 11 not direct evidence of every witness's relationship with one of 12 the defendants. How is this direct evidence of any crime that 13 Ms. Annabi is charged with? How? How? 14 MR. CARBONE: Judge, I think the proffered relevance 15 is that this witness has just testified about the nature of the 16 relationship between Mr. Jereis and Ms. Annabi and she did that 17 based upon the close relationship and the relationship of trust 18 that Ms. Annabi and Ms. Chousa had. 19 THE COURT: That is OK. It certainly does not 20 establish anything about a relationship of closeness and trust 21 to present evidence that one of the two people in that 22 allegedly close and trusting relationship forged the signature 23 of the other. That is classic. That is a bad act. 24 Forgery is a bad act, Mr. Carbone. I don't think you 25 can come up with any reason, any definition of the term "bad SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2061 C36UANN6 Chousa - direct 1 act" that wouldn't encompass forgery. It is a prior uncharged, 2 as far as I can tell -- I read the indictment once upon a 3 time -- bad act. 4 MR. CARBONE: But the fact, Judge, that this witness 5 that had such trust in Ms. Annabi that she permitted her to 6 open an account in her name, sign her name to checks, sign her 7 name to campaign financial disclosure -- 8 THE COURT: Not in 2007, she didn't. 9 MR. CARBONE: No, but during the time period of the 10 conspiracy she did. 11 THE COURT: This is a blatant 404(b) violation. This 12 is not evidence. This is not evidence of any crime that is 13 charged in this case. This is more obviously 404(b) than most 14 of the garbage that you put in the letters that you said was 15 404(b). 16 MR. CARBONE: Judge, we, obviously -- 17 THE COURT: -- disagree. 18 MR. CARBONE: -- disagree with your characterization. 19 THE COURT: That is fine, but I have spoken. 20 MR. CARBONE: Thank you. 21 MR. ARONWALD: Your Honor, I would now move to strike 22 the testimony relating to that last exhibit, the signature 23 cards and all questions relating to whether it was her 24 signature and whether she recognize the handwriting. And I 25 would ask the Court to instruct the jury to disregard it. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2062 C36UANN6 Chousa - direct 1 THE COURT: It will be done. 2 MR. ARONWALD: Thank you, your Honor. 3 4 (Continued on next page) 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2063 C36UANN6 Chousa - direct 1 (Jury present) 2 (Witness present) 3 THE COURT: Folks, after talking to the lawyers, I 4 have concluded that Mr. Aronwald's objection is entirely 5 well-founded, that the testimony that you have just heard has 6 nothing to do with this case at all. Nothing. 7 Strike it. If you wrote any notes about this document 8 or Ms. Chousa's description of handwriting or anything like 9 that, cross them out. Forget you ever heard it. It has 10 nothing to do with this case. Nothing at all. It doesn't 11 relate to any crime charged in this case. Is proof of nothing. 12 Sorry about the interruption. 13 You may continue if you have anything relevant to ask. 14 MR. HALPERIN: We have no further questions, Judge. 15 THE COURT: Mr. Aronwald. 16 CROSS-EXAMINATION 17 BY MR. ARONWALD: 18 Q. Ms. Chousa, am I pronouncing your name correctly, Chousa? 19 A. You are. 20 Q. During your direct examination, you testified that you saw 21 Ms. Annabi -- that during the years 2001 through 2005, you saw 22 Ms. Annabi every week, two to three times a week and then on 23 weekends. Do you recall that testimony? 24 A. We would see each other pretty often, yes. 25 Q. Do you recall the testimony just a few moments ago -- SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2064 C36UANN6 Chousa - cross 1 A. Yes. 2 Q. -- where you said, during the years 2001 and 2005, you saw 3 Ms. Annabi every week, two to three times a week and then again 4 on weekends? Do you recall that? 5 A. Yes, yes. 6 Q. By the way, during the period of time 2001 to 2005, 7 Ms. Annabi lived in the city of Yonkers, correct? 8 A. Correct. Yes. 9 Q. And you lived in Ossining? 10 A. Yes. 11 Q. And Ms. Annabi lived with her family? 12 A. Yes. 13 Q. And you lived with your parents, correct? 14 A. Yes. 15 Q. With respect to how often you saw Ms. Annabi, isn't it true 16 that you actually hardly saw Ms. Annabi during the week during 17 that period but you saw her almost every weekend? 18 A. No. 19 Q. Do you remember testifying in the grand jury? 20 A. I do. 21 Q. And do you recall when you were before the grand jury, you 22 took an oath to tell the truth, the whole truth and nothing but 23 the truth? 24 A. Yes. 25 Q. And that was the same oath you took here just a few moments SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2065 C36UANN6 Chousa - cross 1 ago, correct? 2 A. Yes. 3 Q. Do you recall telling the grand jury that during that 4 period of time, you and Sandy were almost like sisters? 5 A. Yes. 6 Q. Do you recall being asked this question and giving this 7 answer, by Mr. Halperin, in the grand jury on June 30, 2009, 8 3508-A, page 7, lines 9 through 13? Do you recall being asked 9 this question and giving this answer: 10 "Q During this time, when would the two of you see each 11 other? 12 "A Mostly every weekend. I would drive to her house. We 13 would go to dinner, go out with friends, probably almost every 14 weekend." 15 Do you recall being asked that question and giving 16 that answer when you were before the grand jury? 17 A. Yes. 18 Q. And was that the truth when you gave that answer? 19 A. Yes. 20 MR. ARONWALD: If I could just have a moment? 21 THE COURT: Of course, Mr. Aronwald. 22 Q. Now, with respect to the time that you learned that 23 Ms. Annabi was going to run for the city council, it was in 24 that context that you first met Zehy Jereis, correct? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2066 C36UANN6 Chousa - cross 1 Q. By the way, getting back to that period 2001 to 2005, when 2 you were living in Ossining, where were you working? 3 A. In Armonk. 4 Q. With respect to meeting Mr. Jereis for the first time, you 5 testified that you would go to lunches and dinners with Sandy 6 and Zehy, correct? 7 A. Yes. 8 Q. It was your recollection, according to your testimony, that 9 the only topic that was discussed on those occasions was 10 politics? 11 A. Yes. 12 Q. And, basically, Mr. Jereis, according to your testimony, 13 was helping Sandy with her campaign, correct? 14 A. Yes. 15 Q. In fact, didn't you tell the grand jury that he was her 16 campaign manager? 17 A. Yes. 18 Q. So he wasn't just assisting her, he was actually running 19 her campaign, correct? 20 A. Yes. 21 Q. Do you recall that early on after Sandy indicated that she 22 was running for the city council, do you recall being present 23 during a conversation that took place between Sandy and Zehy 24 Jereis, and do you recall a specific meeting that took place at 25 a diner to discuss the campaign? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2067 C36UANN6 Chousa - cross 1 A. Yes. 2 Q. The subject of discussion at that diner was the political 3 approach that Sandy should take in running for the city 4 council, correct? 5 A. Yes. 6 Q. You knew you that Sandy Annabi was from Jordan, correct? 7 A. Yes. 8 Q. And you also knew that Zehy Jereis was from Jordan, 9 correct? 10 A. No. 11 Q. You knew that he was Arabic? 12 A. Yes. 13 Q. And in fact that was one of the subjects of discussion at 14 that diner meeting, correct? 15 A. I don't recall that, no. 16 Q. Well, the meeting took place -- the election that we are 17 talking about was going to be held in November of 2001, 18 correct? 19 A. Yes. 20 Q. And as we all know, September 11, 2011 was a very bad day 21 for America, correct? 22 MR. HALPERIN: Objection. Relevance. 23 THE COURT: The objection is sustained. 24 Q. Do you recall that at that meeting, there was a discussion 25 as to whether or not the fact that Sandy Annabi was Jordanian SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2068 C36UANN6 Chousa - cross 1 would be a factor that they would have to deal with because it 2 was only two months after September 11? 3 MR. HALPERIN: Objection. Hearsay. Relevance. 4 THE COURT: The objection is sustained. 5 Q. You never had any discussion with Sandy Annabi about the 6 fact that she had purchased these homes, did you? 7 A. No. 8 Q. Now, with respect to your testimony about where Sandy was 9 living, do you remember testifying just a few moments ago that 10 you knew that Sandy was not living at 53 Linden but was living 11 in Bacon Place because that's where all her clothes were? 12 A. Yes. 13 Q. And do you recall saying that she wasn't living at Rumsey 14 Road either because all of her clothes were at Bacon Place? Do 15 you recall that? 16 A. I don't recall saying that she didn't live there at all. 17 Q. So as far as you knew, you understood that Sandy Annabi was 18 living at 245 Rumsey Road as well as at 45 Bacon Place -- 19 A. No, she was living -- 20 THE COURT: Let him finish talking just because this 21 poor court reporter can't take you both down. 22 Would you finish your question. 23 Q. Did you testify a few moments ago that all of Sandy's 24 clothes were at 45 Bacon Place? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2069 C36UANN6 Chousa - cross 1 Q. You had been to both 245 Rumsey Road and 45 Bacon Place? 2 A. Yes. 3 Q. In fact, do you recall, you said you had been to 245 Rumsey 4 Road about half a dozen times? 5 A. Correct. 6 Q. You described for the jury 45 Bacon Place? 7 A. Yes. 8 Q. Would you now describe for the jury the apartment 245 9 Rumsey Road where Sandy lived? 10 A. Yes. 11 Q. Please do. 12 A. You walk in, little den here, small little kitchen in the 13 front, bedroom over here to the side, and there was a little 14 bathroom there somewhere too. 15 Q. Did you ever have occasion to look in Sandy Annabi's 16 closet? 17 A. She had the door open. 18 Q. Were there clothes in the closet? 19 A. There were some, yes. 20 Q. Was there a chest of drawers or a dresser in the bedroom? 21 A. I believe there was one with a mirror. 22 Q. Did you ever go in those drawers? 23 A. No. 24 Q. So you don't know whether there were clothe in them or not? 25 A. I don't. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2070 C36UANN6 Chousa - cross 1 Q. On the weekends when you saw Sandy Annabi, you said that 2 you would pick her up more often at 45 Bacon Place than you 3 would Rumsey Road? 4 A. Yes. 5 Q. Would it be fair to say that on the occasions you might 6 have picked up her at Rumsey road, those were generally during 7 the week on those few occasions during week when you would see 8 her, is that correct? 9 A. Could be, yes. 10 Q. But on the weekends when you would see her, you would pick 11 her up more often at 45 Bacon Place? 12 A. Yes. 13 Q. And that's when we are parents lived, right? 14 A. Yes. 15 Q. As far as you know, you would drop her off at 45 Bacon 16 Place, right? 17 A. Yes. 18 Q. So as far as you understood, Sandy was sleeping at 45 Bacon 19 Place on those weekends, correct? 20 A. I would drop her off and I would leave. 21 Q. You never saw her go in? 22 A. A couple of times, yes, I would see her go in. 23 Q. You never saw her come back out, get in her car and drive 24 away, did you? 25 A. I didn't wait long enough, no. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2071 C36UANN6 Chousa - cross 1 Q. Now, after August of 2004, do you have any specific 2 recollection of seeing Sandy Annabi during the weekdays, Monday 3 through Friday? 4 A. We could have. 5 Q. You don't have any specific recollection, do you? 6 A. No, I didn't keep a record, no. 7 Q. So on those occasions, other than the times when you would 8 pick Sandy up at 45 Bacon Place or drop her off at 45 Bacon 9 Place, you don't know where she was living during that period, 10 do you? 11 A. She was at Bacon. That's where I would pick her up and 12 drop her off. 13 Q. On the weekends? 14 A. Or during the week, whenever we would go out. 15 Q. But you just testified that you have no specific 16 recollection of seeing her during the weekdays -- 17 A. We could have gone out -- 18 Q. Go ahead. 19 A. No. You finish. 20 Q. You did testify a few moments ago that you have no specific 21 recollection of seeing Sandy Annabi during the week after 22 August of 2004? 23 A. I could have. I don't recall. 24 Q. OK. So what I am saying is, other than on those occasions, 25 other than the times when you dropped her off or picked her up SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2072 C36UANN6 Chousa - cross 1 at 45 Bacon Place, on any other days during that period, you 2 don't know where she was putting her head down at night, do 3 you? 4 A. I don't. 5 Q. You don't know where she was living on those other 6 occasions, do you? 7 A. I don't. 8 Q. By the way, you said that you had visited Sandy when she 9 was living at 51 Linden Street? 10 A. Yes. 11 Q. And then you dropped her off and picked her up at 45 Bacon 12 Place? 13 A. When she was living at Bacon, no. 14 Q. When she was staying at 45 Bacon -- on those occasions that 15 you picked her up and dropped her off, right? 16 A. Yes. 17 Q. How would you describe the Bacon Place neighborhood? 18 A. Very nice neighborhood. 19 Q. What about the neighborhood of Linden Street? 20 A. Not so nice neighborhood. 21 Q. I'm sorry? 22 A. A not so nice neighborhood. 23 Q. When you say a not so nice neighborhood, what do you mean? 24 A. There were a lot of people hanging out in front of the 25 stores and just a lot of commotion back and forth versus the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2073 C36UANN6 Chousa - cross 1 Bacon Street which was a very quiet residential area. 2 MR. ARONWALD: One moment, please. 3 May I just have one moment, please, your Honor? 4 Q. By the way, do you recall on one occasion going to Sandy's 5 apartment at 245 Rumsey Road and cooking dinner? 6 A. Yes. 7 Q. Do you recall when that was? 8 A. I can't recall. It was on a weekend, maybe Saturday or a 9 Sunday. 10 Q. Was it only you and Sandy that you were cooking for? 11 A. No. There was a gentleman that she was seeing, I think. 12 Q. So you were cooking dinner for you, Sandy and the 13 gentleman? 14 A. And there were a couple of other people there. 15 Q. And a couple of other people. 16 So basically from the experience that you had in 17 cooking dinner, you were able to see what the kitchen looked 18 like? 19 A. Yes. 20 Q. And it was an equipped kitchen? 21 A. Did it have a stove and refrigerator, is that what you 22 mean? 23 Q. And groceries and things like that? 24 A. I brought the groceries, yes. 25 Q. You brought all the groceries; there were no other SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2074 C36UANN6 Chousa - cross 1 groceries at all in the refrigerator or in the cupboard or 2 anything or you don't know? 3 A. I didn't look in the cupboards. I don't recall. 4 MR. ARONWALD: No further questions. 5 Thank you very much. 6 THE COURT: Mr. Siano. 7 MR. SIANO: No questions. 8 MR. HALPERIN: Briefly, Judge. 9 REDIRECT EXAMINATION 10 BY MR. HALPERIN: 11 Q. Ms. Chousa, after Ms. Annabi moved out of 51 Linden Street 12 in August of 2004, what is your understanding of about where 13 Ms. Annabi lived? 14 A. On Bacon. 15 Q. In late 2004 and 2005, where did you pick her up the vast 16 majority of times? 17 A. At Bacon. 18 Q. Where were most of Ms. Annabi's clothes during this time 19 period? 20 A. At Bacon. 21 Q. Based on your discussions with Ms. Annabi, what was your 22 understanding about where she lived after August 2004 and 23 throughout 2005? 24 A. She lived on Bacon and then she moved to Rumsey Road. 25 Q. During that time frame in 2004 and 2005, based on all of SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2075 C36UANN6 Chousa - redirect 1 these discussions, based on where you picked her up, what was 2 your understanding about where Ms. Annabi lived? 3 A. It was always Bacon. 4 MR. HALPERIN: Thank you, Judge. 5 MR. ARONWALD: One question, please. 6 THE COURT: Yes, Mr. Aronwald. 7 RECROSS EXAMINATION 8 BY MR. ARONWALD: 9 Q. Let's get back to the grand jury, June 30, 2009. Do you 10 remember being asked this question and giving this answer, by 11 Mr. Halperin, at page 24, lines 17 through 21: 12 "Q How did you know Sandy moved into the house on Bacon 13 Place? 14 "A I used to go there to pick her up. 15 "Q About how often would you go there? 16 "A About once a week." 17 Do you recall being asked those questions and giving 18 those answers under oath in the grand jury on June 30, 2009? 19 A. If I was given those questions and I answered under oath -- 20 THE COURT: The question is: Do you recall being 21 asked those questions and giving those answers? Were you asked 22 those questions, yes or no? 23 THE WITNESS: Yes. 24 THE COURT: And did you give those answers? 25 THE WITNESS: I did. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2076 C36UANN6 Chousa - recross 1 MR. ARONWALD: No further questions. 2 MR. HALPERIN: Nothing further, Judge. 3 THE COURT: Thank you, ma'am very much. 4 You may step down and you can go home. 5 THE WITNESS: Thank you. 6 (Witness excused) 7 THE COURT: And you can go home too, but I will see 8 you all tomorrow morning. 9 We are just racing through the list of witnesses that 10 the government gave me this morning. We will actually get to 11 the close of the government's case by the close of business on 12 Thursday which will be early. It will be at 2 o'clock. So we 13 will take a break around 11:30 for a snack and then we will go 14 to 2. 15 Don't discuss the case. Keep an open mind. 16 See you tomorrow. 17 18 (Continued on next page) 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2077 C36UANN6 1 (Jury not present) 2 THE COURT: Before we leave, we have a preliminary -- 3 I emphasize "preliminary" -- draft charge for you to start 4 taking a look at and taking potshots at. Mr. O'Neil has a 5 continuing education obligation for the latter part of the 6 week, so we will lose him in the middle of tomorrow -- 7 THE DEPUTY CLERK: No. Next week. 8 THE COURT: So anyway, we have gotten it out a little 9 earlier than usual it is probably a little longer than usual. 10 Are there any issues that we know are going to come up 11 tomorrow? 12 MR. ARONWALD: Well, the one issue, your Honor, and I 13 had had some discussions with Mr. Carbone and Halperin about 14 this, your Honor had ordered that the government provide us 15 with the order of the witnesses they were going to call. And I 16 think your Honor indicated that your Honor wanted that list to 17 be provided to you as well. 18 We had received a witness list on February 22nd. That 19 was the last order of witness list we received. 20 Yesterday, I spoke to government counsel about the 21 order of the witnesses because they didn't seem to be coming in 22 the order in which they were on the February 22nd list, and I 23 was told that I would receive a revised witness list yesterday. 24 And I received it last night. 25 A number of the witnesses are witnesses who were SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2078 C36UANN6 1 included in the witnesses who were supposed to be testifying 2 next week. And that 3500 material we only received this past 3 Thursday. So, for example, this witness was in the 3500 4 material for next week. So I don't know who the witnesses are 5 going to be tomorrow. But to the extent that they were 6 included in next week's 3500 material -- 7 THE COURT: The problem is that next week is now this 8 week because we have made great progress. Next week is this 9 week. When will then be now, soon. 10 MR. HALPERIN: Mr. Aronwald was mistaken when he said 11 he didn't get the 3500 until Thursday because we produced it 12 last Monday. In any event, let me say the order because, as 13 the Court said, we are flying and we can certainly represent 14 that tomorrow's witness will include the following. We will 15 try to go in this order but some witnesses have scheduling 16 issues so there may need to be a little bit of flip, but in 17 terms of tomorrow, we will have: John Bond, Shelly Beck. 18 Colleen Taylor-Crusie, a stipulation, Paul Crowley, Walid 19 Farhat, I think Kenneth Bicknese -- we are checking on his 20 schedule -- and possibly we will get into Rosemary Karaka and 21 James O'Connor, but that depends how quickly we move. 22 MR. ARONWALD: Are any of those witnesses, witnesses 23 for whom there is no 3500 material? 24 MR. HALPERIN: Judge, we will talk to Mr. Aronwald 25 after. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2079 C36UANN6 1 THE COURT: Have a chat. 2 MR. ARONWALD: Thank you, your Honor. 3 THE COURT: I am expecting, Mr. Siano, to nap through 4 most of the rest of the government's case. 5 MR. SIANO: Nap, your Honor? 6 THE COURT: I miss you, Mr. Siano. You are quiet 7 again. Once again you are quiet. 8 MR. SIANO: That's a compliment. 9 THE COURT: Hasta manana. 10 (Proceedings adjourned until 9:30 a.m., March 7, 2012) 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2080 1 INDEX OF EXAMINATION 2 Examination of: Page 3 JOSEPH ENRIGHT 4 Direct By Mr. Halperin . . . . 1889 5 Cross By Mr. Aronwald . . . . 1899 6 Cross By Mr. Siano ...... 1904 7 Redirect By Mr. Halperin . . . 1910 8 Recross By Mr. Aronwald . . . 1912 9 JOSEPH JENIK 10 Direct By Mr. Carbone . . . . 1913 11 Cross By Mr. Aronwald . . . . 1950 12 Redirect By Mr. Carbone . . . 1959 13 DEAN CIVITELLI 14 Direct By Mr. Carbone . . . . 1960 15 Cross By Mr. Aronwald . . . . 1966 16 ODILON MEJIA 17 Direct By Mr. Halperin . . . . 1969 18 Cross By Mr. Aronwald . . . . 1988 19 FRANK ROCCO 20 Direct By Mr. Carbone . . . . 2004 21 Cross By Mr. Aronwald . . . . 2026 22 Redirect By Mr. Carbone . . . 2028 23 CARL MANISCALCO 24 Direct By Mr. Carbone . . . . 2029 25 MARIA CHOUSA SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2081 1 Direct By Mr. Halperin . . . . 2037 2 Cross By Mr. Aronwald . . . . 2063 3 Redirect By Mr. Halperin . . . 2074 4 Recross By Mr. Aronwald . . . 2075 5 GOVERNMENT EXHIBITS 6 Exhibit No. Received 7 485 ...... 1955 8 560 through 560-C ...... 1963 9 551 ...... 1977 10 607, 620, 621 ...... 2021 11 1218 ...... 2046 12 13 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300

2082 C37UANN1 Trial 1 UNITED STATES DISTRICT COURT 1 SOUTHERN DISTRICT OF NEW YORK 2 ------x 2 3 UNITED STATES OF AMERICA, 3 4 v. 10 CR 007 (CM) 4 5 SANDY ANNABI and ZEHY JEREIS, 5 6 Defendants. 6 7 ------x 7 8 New York, N.Y. 8 March 7, 2012 9 9:55 a.m. 9 10 10 11 11 Before: 12 12 HON. COLLEEN MCMAHON 13 13 District Judge 14 14 15 APPEARANCES 15 16 PREET BHARARA 16 United States Attorney for the 17 Southern District of New York 17 JASON P.W. HALPERIN 18 PERRY A. CARBONE 18 Assistant United States Attorneys 19 19 WILLIAM I. ARONWALD 20 Attorney for Defendant ANNABI 20 21 ANTHONY J. SIANO 21 JEANNIE GALLEGO 22 Attorneys for Defendant JEREIS 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2083 C37UANN1 Trial 1 (In open court; jury not present) 2 THE COURT: Who is on first? 3 MR. HALPERIN: The parties have a short stipulation 4 and then the parties will be calling John Bond. 5 THE COURT: Good. Let's go. 6 (Jury present) 7 THE COURT: So we had a bunch of students from the 8 University of Paris -- that's what that big group was -- so I 9 put them in the jury box so that they could feel like you feel. 10 And we talked a little bit and they were just fascinated by 11 everything that was going on -- particularly you guys because 12 they are not used to jurors -- so we had a fun conversation. 13 This morning we start with a stipulation by and 14 between the usual parties: 15 1. That the deposits of Fremont Investment and Loan 16 were insured by the Federal Deposit Insurance Corporation in 17 the year 2004. 18 2. The postal money orders marked as Government 19 Exhibits 208B through 208E were filled out by Zehy Jereis, the 20 defendant. 21 3. A front-page lead story appeared in the Journal 22 News, a daily newspaper in Westchester, on March 8, 2007 23 announcing a federal grand jury probe into allegations relating 24 to the Ridge Hill project. 25 Those three facts are deemed proved. Some day someone SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2084 C37UANN1 Trial 1 will explain to us why they are relevant. 2 Mr. Halperin, you are up. 3 MR. HALPERIN: Mr. Carbone. 4 THE COURT: Mr. Carbone. 5 JOHN L. BOND, 6 called as a witness by the government, 7 having been duly sworn, testified as follows: 8 DIRECT EXAMINATION 9 BY MR. CARBONE: 10 Q. Good morning. 11 A. Good morning. 12 Q. What is your profession? 13 A. I am an attorney. 14 Q. How far did you go in school? 15 A. Three years of law school. 16 Q. Where did you attend law school? 17 A. St. John's University. 18 Q. How long have you been an attorney? 19 A. 16 years. 20 Q. Where is your office located? 21 A. I am currently located at 125 Corporate Boulevard, Yonkers, 22 New York. 23 Q. Do you have any partners? 24 A. No. 25 Q. Do you have any employees? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2085 C37UANN1 Bond - direct 1 A. No. 2 Q. What areas of law do you practice? 3 A. Primarily real estate transactions. 4 Q. Can you tell us what you do as a real estate attorney? 5 A. As a closing attorney, we review contracts of sale between 6 buyers and sellers. We review title searches regarding 7 property and attend closings. 8 Q. What is a closing? 9 A. A closing is where the buyer pays the money for the house 10 and receives a title or deed to the property, and at that time 11 they also, if they are borrowing money, they sign mortgage 12 documents. 13 Q. Do you know the defendant Zehy Jereis? 14 A. I do. 15 Q. How did you meet? 16 A. We met in the mid 1990s through my old employer who I 17 worked for at that time. 18 Q. Was he a client? 19 A. He was a client. 20 Q. Do you socialize? 21 A. We do. 22 Q. Do you know the defendant Sandy Annabi? 23 A. Yes. 24 Q. How long have you known her? 25 A. Since around the spring of 2004. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2086 C37UANN1 Bond - direct 1 Q. How did you meet Sandy Annabi? 2 A. We met her through her father, Mr. Sam Annabi. 3 Q. Do you socialize with Sandy Annabi? 4 A. No. 5 Q. Have you ever represented Sandy Annabi in connection with 6 any legal matter? 7 A. Yes. 8 Q. Who referred her to you? 9 A. Mr. Sam Annabi, her father. 10 Q. On what matters have you represented her? 11 A. On the purchase of two, three pieces of real estate and a 12 the sale of a piece of real state. 13 Q. Approximately when did the closings take place? 14 A. The closing took place in the summer of 2004 and one 15 closing took place in February of 2005. 16 Q. Can you please explain the services you provide when doing 17 a residential house closing? 18 A. Well, primarily we, as I said before, we negotiate the 19 contracts of sale between the buyer and seller, communicate 20 with the attorney on the other side of the transaction. We 21 order a title search on the property to make sure that there 22 are no judgments or liens or old outstanding taxes against the 23 property and then we attend the closing, in which case we make 24 sure that the buyer receives a title to the property. 25 Q. So how many closings did you represent Sandy Annabi on in SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2087 C37UANN1 Bond - direct 1 which she was the purchaser? 2 A. Three residential transactions. 3 Q. How many did you represent her on where she was the seller? 4 A. One. 5 Q. Do you recall attending the closings in which you 6 represented Sandy Annabi? 7 A. Yes. 8 Q. Do you recall whether she also attended those closings? 9 A. I do recall. 10 Q. And did she? 11 A. Yes, she did. 12 Q. Do you recall the specific documents that you reviewed with 13 her at the closings? 14 A. No, I don't recall the documents of that day, of those 15 closings. 16 Q. Are you familiar with the phrase lender's package? 17 A. Yes. 18 Q. What is a lender's package? 19 A. It is a group of documentation that the lender requires be 20 signed at the closing which would include a loan agreement, a 21 mortgage document and then numerous other disclosures. 22 Q. Do you typically review the documents in the lender's 23 package with your client at closing? 24 A. What we do at the closing is, we get the loan documentation 25 from the bank and then describe what the document is and have SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2088 C37UANN1 Bond - direct 1 the client review the document, unless there are any questions, 2 and they will sign it at that point. 3 Q. When you say you explain what the document is, who do you 4 explain that to? 5 A. My client. 6 Q. Is that your custom and practice? 7 A. That's correct. 8 Q. When you review the documents contained in the lender's 9 package with the client at the closing, do you do that in the 10 presence of others? 11 A. It would be in the presence of everyone that is attending 12 the closing that day. 13 Q. Do you recall the locations -- when I say the "locations", 14 I mean the properties in which you represented Sandy Annabi as 15 the buyer? 16 A. I do. 17 Q. Where were those properties located? 18 A. The properties were located in Yonkers -- one property on 19 Rumsey Road, a property on Bacon Place and a property on Patton 20 Drive. 21 Q. Let's start with the Patton Drive property. 22 MR. CARBONE: Mr. Turk, could you please broadcast 23 Government Exhibit 466 in evidence. 24 Q. Now, referring to 466 in evidence, can you explain to the 25 jury what a HUD 1 settlement statement is? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2089 C37UANN1 Bond - direct 1 A. The HUD 1 settlement statement is basically a snapshot of 2 the closing costs and figures that occurred on the day of 3 closing so that the buyer has an idea of what they have been 4 charged by the bank and the title company. 5 Q. Now, what is the location of the property in this HUD 1 6 settlement statement? 7 A. 13 Patton Drive, Yonkers, New York. 8 Q. What was the settlement date? 9 A. July 27, 2004. 10 Q. What is the settlement date? What does the word 11 "settlement" relate to? 12 A. That is just the date of closing when the transaction was 13 finalized and the proceeds to the seller were paid. 14 Q. Can you tell the jury where this closing took place? 15 A. This closing would have been at the settlement agent's 16 office, Mike Attanasio, 656 Yonkers Avenue, Yonkers, New York. 17 MR. CARBONE: Now, Mr. Turk, could you please maximize 18 line 201 where it says $100,000? 19 Q. How much of a deposit or down payment does it indicate that 20 Ms. Annabi gave in connection with the purchase of 13 Patton 21 Drive? 22 A. It appears to be 100,000, although there is a number there, 23 that is either a 6 or a 0. 24 MR. CARBONE: Can you please restore the document. 25 Q. What was the purchase price of the property? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2090 C37UANN1 Bond - direct 1 A. The purchase price was 506,000. 2 Q. What was the approximate amount of the loan? 3 A. $430,100. 4 MR. CARBONE: Please turn to page 2, Mr. Turk, and 5 maximize the bottom of the page. 6 Q. Did you review the settlement statement with your client at 7 closing? 8 A. We typically do. 9 Q. Whose signature is indicated there above the borrower? 10 A. That appears to be Sandy Annabi. 11 MR. CARBONE: Please broadcast Government Exhibit 458. 12 Please broadcast the top right. 13 Q. Can you tell us whose initials they appear to be? 14 A. They appear to be Sandy Annabi. 15 MR. CARBONE: Please restore the document. 16 Q. Can you explain what an occupancy affidavit and financial 17 occupancy affidavit and financial status document is? 18 A. It is basically a document that details the type of 19 property you are purchasing. And financial status is just a 20 certification about the -- I guess about the information that 21 was provided to the bank by the buyer. 22 MR. CARBONE: Mr. Turk, could you maximize the box 23 that is checked. 24 Q. Mr. Bond could you please read that box? 25 A. "I/we or at least one of the applicants now occupy the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2091 C37UANN1 Bond - direct 1 subject property. I/we understand that the lender is willing 2 to evaluate my loan application only because I/we certify the 3 intention to occupy the property." 4 Q. Now, Mr. Bond, will you please look at what's been marked 5 as Government Exhibit 470 for identification which is not in 6 evidence yet. It should be in the binder in front of you. 7 A. OK. I have it here. 8 Q. Can you explain to the jury what Government Exhibit 470 is? 9 A. This is a promissory note agreement between Sandy Annabi as 10 the borrower and Zehy Jereis as the lender in the amount of 11 $60,000. 12 Q. Who prepared it? 13 A. I did. 14 Q. Whose signature appears on page 2? 15 A. That would be Sandy Annabi. 16 Q. Did you witness her sign it? 17 A. Yes. 18 Q. What is the legal effect of this document? 19 A. Basically it is a loan agreement between two parties 20 whereby the borrower is indebted to pay back the lender the sum 21 of money that is indicated on here. 22 Q. Was this agreement maintained in your file? 23 A. It was. 24 Q. Was it kept in the ordinary course of business? 25 A. Correct. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2092 C37UANN1 Bond - direct 1 MR. CARBONE: Your Honor, we offer Government Exhibit 2 470 in evidence. 3 MR. ARONWALD: No objection. 4 MR. SIANO: No objection. 5 THE COURT: Admitted. 6 (Government Exhibit 470 received in evidence) 7 MR. CARBONE: Mr. Turk, could you broadcast Government 8 Exhibit 470. Maximize the first paragraph. 9 BY MR. CARBONE: 10 Q. Who is the maker of the note? 11 A. The maker of the note is Sandy Annabi. 12 Q. What is the date of this note? 13 A. It is not indicated -- there it is. It is June 8, 2004. 14 Q. What are the terms of the note -- directing your attention 15 to paragraph 2? 16 A. This is what they call a demand note so that, in essence, 17 the lender can call the loan in at any time that they wish. 18 MR. CARBONE: And now turn to page 2, Mr. Turk, and 19 maximize paragraph 6. 20 Q. Can you explain the legal effect of paragraph 6? 21 A. What that is, is that in the event of a default which would 22 be that the borrower does not pay back the loan when it is 23 requested, then the maker who is giving the loan would be 24 entitled to interest at 9 percent per annum from when it is 25 demanded until it is paid. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2093 C37UANN1 Bond - direct 1 Q. Now, please take a look at Government Exhibit 469 for 2 identification. Do you have that in front of you? 3 A. Yes, I do. 4 Q. What is Government Exhibit 469? 5 A. That is a statement of closing indicating the transaction 6 details from the actual closing date. 7 Q. And who prepared it? 8 A. I prepared that. 9 Q. What transaction is that closing? 10 A. This is for 13 Patton Drive in Yonkers, New York. 11 Q. Is that kept in the normal course of your business? 12 A. That's correct. 13 MR. CARBONE: Your Honor, we offer Government Exhibit 14 469 in evidence. 15 MR. ARONWALD: One moment, your Honor. 16 No objection. 17 MR. SIANO: No objection. 18 THE COURT: Admitted. 19 (Government Exhibit 469 received in evidence) 20 MR. CARBONE: Mr. Turk, please broadcast page 1. 21 BY MR. CARBONE: 22 Q. Now, again, what was the date and time of closing? 23 A. July 27, 2004 at 9:30 a.m. 24 MR. CARBONE: Now, please turn to page 2 -- my 25 apologies -- page 4, and maximize the line that says 7/30/04 to SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2094 C37UANN1 Bond - direct 1 Zehy Jereis. 2 Q. Did Mr. Jereis get money from this closing? 3 A. He was issued a check at the closing. 4 Q. Where did the proceeds come from for the check that you 5 issued Mr. Jereis? 6 A. They were from a loan proceeds that was borrowed by Sandy 7 Annabi. 8 Q. Was that in connection with the purchase of the Patton 9 Drive house? 10 A. That's correct. 11 MR. CARBONE: Please broadcast Government Exhibit 204 12 in evidence. 13 MR. SIANO: Could I have a moment? 14 THE COURT: Yes. 15 (Discussion off the record among counsel) 16 MR. CARBONE: Please maximize the top half of the 17 check. 18 BY MR. CARBONE: 19 Q. Mr. Bond, who wrote this check? 20 A. I did. 21 Q. Where did the money come from? 22 A. The money was from the loan proceeds for a loan that Sandy 23 Annabi borrowed. 24 Q. From? 25 A. Fremont Investment and Loan was the lender. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2095 C37UANN1 Bond - direct 1 Q. Who did you write the check to? 2 A. The check was written to Zehy Jereis. 3 Q. Now, what is the next real estate transaction you 4 represented Ms. Annabi on? 5 A. The next property would have been Bacon Place. 6 Q. How long after that closing at Patton Drive did the Bacon 7 Place closing take place? 8 A. A few days later. 9 MR. CARBONE: Please broadcast Government Exhibit 494. 10 Q. What is Government Exhibit 494? 11 A. This is a HUD 1 settlement statement. 12 Q. For which transaction? 13 A. This is for 45 Bacon Place. 14 MR. CARBONE: Would you maximize the top third of the 15 document, please. 16 Q. Where does the HUD 1 settlement statement indicate Sandy 17 Annabi resides? 18 A. 45 Bacon Place, Yonkers, New York. 19 Q. Does it indicate the lender? 20 A. The lender is Columbia Equities. 21 Q. Where did the settlement or the closing take place? 22 A. This closing was at 400 Columbus Avenue in Valhalla, New 23 York. 24 Q. What is the settlement date? 25 A. July 30, 2004. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2096 C37UANN1 Bond - direct 1 Q. I'm sorry. Mr. Bond, going back to box D, where does the 2 settlement statement indicate Ms. Annabi resides? 3 A. Oh, I'm sorry. Number D is 51 Linden Street, Yonkers, New 4 York. 5 MR. CARBONE: Now, Mr. Turk, could you maximize the 6 middle of the document, please. 7 Q. What was the purchase price or the contract price for 45 8 Bacon? 9 A. $550,000. 10 Q. Please turn to page 3. Whose signature appears there on 11 the left? 12 A. Sandy Annabi. 13 Q. Please read the language right above her signature 14 beginning with "I have carefully reviewed." 15 A. "I have carefully reviewed the HUD 1 settlement statement 16 and to the best of my knowledge and belief, it is a true and 17 accurate statement of all receipts and disbursements made on my 18 account or by me in this transaction. I further certify that I 19 received a copy of the HUD 1 settlement statement." 20 MR. CARBONE: Please broadcast Government Exhibit 488 21 in evidence. 22 Q. Can you explain what is this document? 23 A. It is an occupancy and financial status affidavit. 24 MR. CARBONE: Can you please maximize section 2 where 25 it says "occupancy" and the following paragraph. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2097 C37UANN1 Bond - direct 1 Q. Mr. Bond would you please read that paragraph? 2 A. "Principal residence. Borrower either currently occupies 3 and uses the property as borrower's principal residence or 4 borrower will occupy and use the property as borrower's 5 principal residence within 60 days after borrower signs the 6 security instrument. Borrower will continue to occupy and use 7 the property as borrower's principal residence for at least one 8 year from the date that borrower first occupies the property. 9 However, borrower will not have to occupy and use the property 10 as borrower's principal residence within the time frames set 11 forth above if lender agrees in writing that borrower does not 12 have to do so. Lender may not refuse to agree unless the 13 refusal is reasonable. Borrower will also not have to occupy 14 and use the property as borrower's principal residence within 15 the time frames set forth above if extenuating circumstances 16 exist which are beyond borrower's control." 17 Q. Could you now turn to page 2. And whose signature appears 18 at the top? 19 A. It appears to be Sandy Annabi. 20 Q. Was this document also notarized? 21 A. It is. 22 Q. Now, do you, as a closing attorney, review the 23 representations your clients make for accuracy? 24 A. No, not typically. 25 Q. Why not? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2098 C37UANN1 Bond - direct 1 A. Well, the representations are information that had been 2 provided to the lenders, typically, so that this information 3 would have already been part of their application process. 4 MR. CARBONE: Please broadcast Government Exhibit 481. 5 Please maximize the top half of the page. 6 Q. What property does this mortgage application relate to? 7 A. It says here 45 Bacon Place, Yonkers, New York. 8 Q. Now, is the typed version of the uniform residential loan 9 application also signed by the borrower at the closing? 10 A. It is. 11 MR. CARBONE: Now, Mr. Turk, would you maximize the 12 bottom third of the page. 13 Q. Whose initials appear on the bottom of the page there? 14 A. It appears to be Sandy Annabi's initials. 15 Q. Please turn to page 2. 16 MR. CARBONE: Maximize the top third. 17 Q. What does the defendant list as her total monthly income 18 there? 19 A. $9,366.67. 20 Q. Do you see any reference to the loan that was made on the 21 Patton property closing which took place three days earlier? 22 A. No, I do not. 23 MR. CARBONE: Please maximize the bottom of the page. 24 Q. Whose initials appear there? 25 A. Sandy Annabi. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2099 C37UANN1 Bond - direct 1 Q. Now turn to page 3. 2 MR. CARBONE: Maximize the top half of the page. 3 Q. Where it says "schedule real estate owned," do you see any 4 indication there that Ms. Annabi had purchased another house 5 three days earlier? 6 A. No, I do not. 7 MR. CARBONE: Would you please highlight and maximize 8 paragraph H in the declaration section. 9 A. Do you want me to read that? 10 Q. Yes. 11 A. "Is any part of the down payment borrowed?" 12 Q. And what is the response box checked? 13 A. It is the righthand box. 14 MR. CARBONE: Could you restore that? 15 A. It would say no at the top. 16 MR. CARBONE: Now, Mr. Turk, could you highlight box 17 L. 18 Q. Please read the question and response. 19 A. "Do you intend to occupy the property as your primary 20 residence? If yes, complete question M below." And the box 21 "yes" is checked. 22 MR. CARBONE: Now, Mr. Turk, please restore the 23 document and maximize the signature section and the affirmation 24 above it. 25 Q. Whose signature appears there? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2100 C37UANN1 Bond - direct 1 A. Sandy Annabi. 2 Q. And the date? 3 A. July 30, 2004. 4 Q. Was that the date of the Bacon closing? 5 A. Yes, that's correct. 6 Q. Could you please read the first sentence up to and 7 including the number 2 on the acknowledgment? 8 A. "Each of the undersigned specifically represents to lender 9 and to lender's actual or potential agents, brokers, 10 processors, attorneys, insurers, servicers, successors and 11 assigns and agrees and acknowledges that: 1. The information 12 provided in this application is true and correct as of the date 13 set forth opposite my signature and that any intentional or 14 negligent misrepresentation of this information contained in 15 this application may result in civil liability, including 16 monetary damages, to any person who may suffer any loss due to 17 reliance upon any misrepresentation that I have made on this 18 application and/or in criminal penalties including, but not 19 limited to, fine, or imprisonment or both under the provisions 20 of Title 18, United States Code, Section 1001." 21 Q. Thank you. 22 Let's jump ahead five or six months. You said that 23 you represented Ms. Annabi on a third piece of property? 24 A. That's correct. 25 Q. Where was that property located? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2101 C37UANN1 Bond - direct 1 A. That property was on Rumsey Road in Yonkers. 2 MR. CARBONE: Please broadcast Government Exhibit 525 3 in evidence. Maximize the top third of the document. 4 Q. Did you attend this closing? 5 A. Yes. 6 Q. Where did the closing take place? 7 A. This closing took place at 1053 Saw Mill River Road in 8 Ardsley, New York. 9 Q. What change is indicated there in box D? 10 A. Box D indicates an address change. 11 Q. And whose initials appear next to that? 12 A. Sandy Annabi. 13 MR. CARBONE: Now, please restore the page, Mr. Turk. 14 Q. Was defendant Sandy Annabi present at this closing? 15 A. Yes. 16 MR. CARBONE: Please maximize box 101, middle of the 17 page beginning right there. 18 Q. What was the total purchase price? 19 A. $72,000. 20 Q. Who was the seller's counsel, do you recall? 21 A. I don't recall. 22 Q. Can you please restore the document? 23 A. Did you ask me for the seller's counsel? 24 Q. Yes. 25 A. The seller's counsel is not indicated here. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2102 C37UANN1 Bond - direct 1 Q. And the law firm? 2 A. I don't know where to look. 3 Q. You represented the buyer, right? 4 A. I represented the buyer in that transaction, correct. 5 Q. Please turn to page 3. 6 MR. CARBONE: Maximize the top third. 7 Q. Can you please read the certification above Ms. Sandy 8 Annabi's signature? 9 A. "I have carefully reviewed the HUD 1 settlement statement 10 and to the best of my knowledge and belief, it is a true and 11 accurate statement of all receipts and disbursements made on my 12 account or by me in this transaction. I further certify that I 13 have received a copy of the HUD 1 settlement statement." 14 MR. CARBONE: Mr. Turk, will you please broadcast 15 Government Exhibit 203 in evidence and maximize 203. 16 Q. Do you recognize that cashier's check? 17 A. I do. 18 Q. What is the date of the check? 19 A. The date of the check is February 10, 2005. 20 Q. What is the amount? 21 A. $11,000. 22 Q. Who was the remitter? 23 A. The remitter is Zehy Jereis. 24 Q. What is a remitter? 25 A. That would be the person who provided the check or whose SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2103 C37UANN1 Bond - direct 1 account it came from. 2 Q. Did you receive this check? 3 A. Yes, I did. 4 Q. What did you do with it? 5 A. We used the proceeds to cover the closing costs for the 6 purchase of Rumsey Road. 7 MR. CARBONE: Now, Mr. Turk, please broadcast 8 Government Exhibit 203C in evidence. Broadcast the middle of 9 the page. Referring to the check on the second line from the 10 bottom in the middle, Mr. Turk, could you maximize that. 11 Q. What is the date of that check? 12 A. February 14, 2005. 13 Q. Who is the check written by? 14 A. It is written by Zehy Jereis. 15 Q. Did you receive that check? 16 A. I did. 17 Q. And the amount? 18 A. $500. 19 Q. What was the purpose of that payment? 20 A. It would be the legal fee for the purchase of Rumsey Road. 21 MR. CARBONE: Now, Mr. Turk, could you please 22 broadcast Government Exhibit 512. Maximize the top third of 23 the page. 24 Q. Now, this typewritten residential loan application, what 25 property does this relate to? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2104 C37UANN1 Bond - direct 1 A. This is 245 Rumsey Road, Yonkers, New York, Apartment 1B. 2 MR. CARBONE: Maximize the middle of the page, please. 3 Q. Did Ms. Annabi make corrections to this document? 4 A. It appears that the address was corrected. 5 Q. Whose initials appear to the right of the address? 6 A. It appears Sandy Annabi's initials. 7 Q. What address is listed? 8 A. The new address or the old address? 9 Q. Both the new and the old. 10 A. The crossed-off address is 45 Bacon Place, Yonkers, New 11 York, and the handwritten address is 53 Linden Street, Yonkers, 12 New York. 13 Q. Now please turn to page 2. 14 MR. CARBONE: Maximize the top of the page. 15 Q. What does Ms. Annabi indicate there is her total monthly 16 income? 17 A. $13,617.25. 18 Q. Do you know whether those figures are accurate? 19 A. No. 20 Q. On the right it indicated that she was receiving other 21 income of 3,474. Do you know what that is? 22 A. No. 23 Q. Again, do you review this form for accuracy at the closing? 24 A. No. 25 Q. What is your custom and practice when you are reviewing SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2105 C37UANN1 Bond - direct 1 residential loan applications with a client at the closing? 2 A. Generally, we hand the form to the client. We explain to 3 them that that's an application, ask them to review it and they 4 go through it. And then if there are no questions or changes, 5 then it is signed, basically. 6 Q. Do you see on the top there where it says "net rental 7 income," do you know whether Ms. Annabi was receiving rental 8 income for the Patton Drive property? 9 A. No, I do not. 10 MR. CARBONE: Please maximize the bottom of the page 11 where the initials are. 12 Q. Tell us what initials appear there. 13 A. Sandy Annabi. 14 Q. Now, turn to page 3. 15 MR. CARBONE: Maximize the "declarations" box. 16 Q. And we would like you to read declaration H and 17 Ms. Annabi's response in declaration L. 18 A. "Is any part of the down payment borrowed?" 19 And the right box is checked no. 20 "Do you intend to occupy the property as your primary 21 residence? If yes, complete question M below." 22 And the box is checked no. 23 MR. CARBONE: Now restore and maximize the signature 24 line. 25 Q. Whose signature appears to be there? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2106 C37UANN1 Bond - direct 1 A. Sandy Annabi. 2 Q. During your representation of Ms. Annabi in connection with 3 the purchase of 245 Rumsey Road, did you have any discussions 4 with Zehy Jereis on the subject of why Sandy Annabi was 5 purchasing the property at 245 Rumsey Road? 6 A. Yes. 7 Q. What did he say? 8 A. It was property that was within her voting district. 9 Q. Did he say that's why she needed to purchase it? 10 A. I recall that would be the conversation. 11 Q. Did you also represent Sandy Annabi in the sale of the 12 Patton Drive house? 13 A. Yes. 14 Q. Please look in front of you at Government Exhibits 472, 15 472A, 472B and 472C which have been marked for identification. 16 A. 472? 17 Q. Yes. They should be towards the end of your binder. 18 A. OK. 19 Q. Do you see those documents? 20 A. I do. 21 Q. And what are those records? 22 A. 472 is a letter that I had prepared to Sandy Annabi. 23 Q. And what is 472A? 24 A. 472A is my closing statement for the sale of 13 Patton 25 Drive. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2107 C37UANN1 Bond - direct 1 Q. Is that 472A or 472C? 2 A. Oh, shoot. I apologize. 3 472A is a copy of a check written to Sandy Annabi. 4 Q. And 472B? 5 A. 472B are checks written by Michael Curto. 6 Q. Is one of those checks written to Sandy Annabi? 7 A. One of them is. 8 Q. What is 472C? 9 A. 472C is my closing statement. 10 Q. Are these kept in the ordinary course of your business? 11 A. Yes. 12 MR. CARBONE: Your Honor, the government offers 472, 13 472A, 472B and 472C. 14 MR. ARONWALD: No objection. 15 MR. SIANO: No objection. 16 THE COURT: Admitted. 17 (Government Exhibits 472, 472A, 472B, 472C received in 18 evidence) 19 MR. CARBONE: Please broadcast Government Exhibit 472. 20 BY MR. CARBONE: 21 Q. In connection with the sale of the Patton Drive house, did 22 you have discussions with Ms. Annabi about it -- without 23 telling us the substance of those discussions? 24 A. Yes. 25 Q. Did you send her correspondence relating to the details SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2108 C37UANN1 Bond - direct 1 surrounding the sale? 2 A. Yes. 3 Q. Who signed this document? 4 A. I had signed it and Sandy Annabi had signed it. 5 Q. Whose handwriting is on the right? 6 A. That was Sandy Annabi. 7 Q. What did she write there? 8 A. "Not allowed in premises until closing." 9 MR. CARBONE: Please broadcast 472A. 10 A. OK. 11 Q. What is Government Exhibit 472A? 12 A. This is a check written to Sandy Annabi. 13 Q. Who is Samuel Babykutty? 14 A. I recall that that would be the buyer of 13 Patton. 15 MR. CARBONE: Now broadcast 472B and maximize the 16 bottom check. 17 Q. What does the last check indicate? 18 A. It is a check written to Sandy Annabi. 19 MR. CARBONE: Now please broadcast 472C. 20 Q. Is that the closing or settlement statement you prepared? 21 A. It is. 22 Q. Where did the closing for the sale take place? 23 A. Closing for the sale took place at Curto Schwartz Curto 24 Bond, 35 East Grassy Sprain Road, Yonkers, New York. 25 Q. And the date and time? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2109 C37UANN1 Bond - direct 1 A. March 24, 2005 at 3:30 p.m. 2 MR. CARBONE: Thank you, Mr. Bond. 3 No further questions, your Honor. 4 THE COURT: Mr. Aronwald. 5 MR. ARONWALD: Could I just have a moment with my 6 client, your Honor? 7 THE COURT: Of course. 8 CROSS-EXAMINATION 9 BY MR. ARONWALD: 10 Q. Good morning, Mr. Bond. 11 A. Good morning. 12 Q. You and I have met? 13 A. Correct. 14 Q. If memory serves, we met on or about May 13 of 2011? 15 A. Correct. 16 Q. With respect to the promissory note which is in evidence, I 17 believe as -- 18 MR. CARBONE: -- 470? 19 MR. ARONWALD: Yes. 20 Would you put that up, please. 21 Q. Now, first, with respect to the role of a closing attorney 22 and as it relates to these three real estate transactions about 23 which you testified, it is true, is it not, that you had 24 absolutely nothing to do with the loan application or with any 25 of the financing arrangements with respect to any of these SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2110 C37UANN1 Bond - cross 1 properties? 2 A. That's correct. 3 Q. And that would be with respect to either the purchase or 4 the sale of the Patton Drive property? 5 A. That's correct. 6 Q. With respect to the promissory note, this is dated June 8 7 of 2004, correct? 8 A. Correct. 9 Q. So that was prior to the closing date on the Patton Drive 10 property, correct? 11 A. Correct. 12 Q. And the Patton Drive property was the first of the three 13 transactions that you testified about, correct? 14 A. Correct. 15 Q. To your knowledge, has that $60,000 been repaid? 16 A. To my knowledge, not in full, that I know about. 17 Q. How much of it was repaid to your knowledge? 18 A. $23,000. 19 Q. Were there any checks that were written out of your account 20 to Mr. Jereis other than the $23,000 check? 21 A. No. 22 MR. ARONWALD: May I just have a moment, your Honor? 23 THE COURT: Yes. 24 Q. The $23,000 check, that was cut out of the proceeds of what 25 transaction? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2111 C37UANN1 Bond - cross 1 A. That came from loan proceeds from the first transaction. 2 Q. Patton Drive? 3 A. That's correct. 4 Q. Just if you could walk us through that. According to the 5 promissory note, Mr. Jereis had loaned Ms. Annabi $60,000, 6 correct? 7 A. Correct. 8 Q. You testified that this was a demand note? 9 A. Correct. 10 Q. Which means that the note is recallable at the demand of 11 Mr. Jereis, correct? 12 A. Yes. 13 Q. So he could have called that note due at any time after the 14 note was executed, correct? 15 A. That's right, yes. 16 Q. You also talked about the fact that -- 17 MR. ARONWALD: I think we turned to page 2. If we 18 could just blow up paragraph number 6. 19 Q. -- in the event of default by maker -- and the maker would 20 be Ms. Annabi, correct? 21 A. Correct. 22 Q. In the payment under this note, the payee -- that would be 23 Mr. Jereis? 24 A. That's correct. 25 Q. -- shall be entitled to receive from the maker interest in SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2112 C37UANN1 Bond - cross 1 the amount of 9 percent per year from the date payment is 2 demanded, correct? 3 A. Yes. 4 Q. Together with any and all expenses, court costs, legal 5 fees, etc. 6 Basically what triggers the default is if Mr. Jereis 7 had made a demand and if Ms. Annabi did not make the repayment, 8 correct? 9 A. That's correct. 10 Q. With respect to the $23,000, if I understand you correctly, 11 the amount of the loan on the Patton Drive property exceeded 12 the amount of the sales price plus the down payment so what was 13 left over was repaid to Mr. Jereis, correct? 14 A. Yes. 15 Q. That's the $23,000. 16 You don't know whether or not any portion of the 17 $60,000 was ever repaid? 18 A. No. 19 Q. Do you recall whether at any time during any of these 20 closings Ms. Annabi left? 21 A. I don't have a visual recollection of the closings. 22 Q. When you wrote that $23,000 check to Mr. Jereis, at whose 23 direction did you did that? 24 A. Mr. Annabi asked me to write that check out. 25 Q. Mr. Annabi? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2113 C37UANN1 Bond - cross 1 A. Sam Annabi, right. 2 MR. ARONWALD: Just one moment, your Honor. 3 Q. Do you recall being interviewed by the government on August 4 27 of 2008? 5 A. I recall being interviewed by the government. As to the 6 specific date, I don't recall. 7 Q. Well, do you recall telling the government that Sandy told 8 you to cut a $23,000 check to Zehy and a $700 check to her 9 father Sami? 10 A. I don't recall that. 11 Q. Showing you what's been marked as 3505E, page 1. 12 MR. ARONWALD: May I approach, your Honor? 13 Q. Just directing your attention to the highlighted portion, 14 just read that to yourself. 15 A. OK. 16 Q. Does that refresh your recollection that you told someone 17 from the government that Sandy instructed you to write that 18 $23,000 check to Mr. Jereis? 19 A. Somewhat. It is possible that that did occur. The 20 closings were eight years ago and I have a tough time 21 recollecting. I know that both Ms. Annabi and Sami Annabi were 22 there. And when I was there, I believe that they conferenced 23 it in before I finished writing the check. 24 Q. When did you first become involved in the Patton Drive 25 transaction, the purchase? Did you have anything at all to do SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2114 C37UANN1 Bond - cross 1 with the preparing or review of the sales contract? 2 A. Well, typically, once we receive a sales contract, we 3 review it with our client. 4 Q. In this particular situation, to your knowledge, were you 5 the one who basically reviewed the sales contract with 6 Ms. Annabi regarding 13 Patton Drive? 7 A. I don't recall specifically. 8 Q. Well, do you recall during the period of your 9 representation that Ms. Annabi wanted to back out of the deal 10 at 13 Patton Drive? 11 A. I don't recall that specifically. 12 Q. So you don't know whether you were the attorney that 13 initially represented her with respect to the purchase of 14 Patton Drive or whether you came in later on and represented 15 her with that deal, correct? 16 A. That's correct. 17 Q. Mr. Carbone asked you whether you verified any of the 18 accuracy that is contained within the loan application? 19 A. He did. 20 Q. When you say that you don't verify it, that's because that 21 is not your job as a closing attorney? 22 A. That would be correct. 23 Q. Anymore than it is your job to go to 53 Linden Street to 24 confirm that Ms. Annabi actually lived there? 25 A. That's correct. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2115 C37UANN1 Bond - cross 1 Q. By the way, with respect to the occupancy affidavit about 2 which you were questioned, the occupancy affidavit with respect 3 to Government Exhibit 488 says that -- 4 MR. ARONWALD: Put that up. 5 (Discussion off the record among counsel) 6 MR. ARONWALD: Can we magnify that box, the one with 7 the X on paragraph 2. 8 Q. And this is with respect to the 45 Bacon Place, is that 9 correct? 10 A. I would have to see the whole document. 11 MR. ARONWALD: Could we just have it restored. 12 A. That's correct. 13 Q. And the date of the closing for Bacon Place, I think you 14 said it was July 30? 15 A. Correct. 16 Q. By the way, you were asked some questions about the final 17 loan application, that is the typed version of the loan 18 application? 19 A. Yes. 20 Q. That is signed at the closing, correct? 21 A. The final application is, yes. 22 Q. So that would have been on July 30 of '04? 23 A. Correct. 24 Q. Of '04. 25 Based upon your experience as a closing attorney, as a SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2116 C37UANN1 Bond - cross 1 real estate attorney, the documents that are going to be used 2 at a closing with respect to the particular transactions, those 3 are not typically prepared on the day of the closing, are they? 4 A. They can be. 5 Q. But they are not typically? 6 A. Typically, ahead of time. 7 Q. Ahead of time. And typically how much ahead of time are 8 the closing documents, including whatever closing documents are 9 required -- how much ahead of the closing date are they 10 typically prepared? 11 A. One or two days. 12 Q. So in this case, the Patton Drive closing you said was on 13 July 27? 14 A. Correct. 15 Q. And do you remember what day of the week that was? 16 A. No, I do not. 17 Q. So this closing on Bacon Place was three days later? 18 A. That's correct. 19 Q. So you don't know whether or not the closing documents for 20 the Bacon Place closing were prepared -- specifically, the 21 typed version of the loan application -- whether those were 22 prepared prior to July 27 of '04, do you? 23 A. No, I would not know that. 24 Q. And you didn't prepare that? 25 A. I don't. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2117 C37UANN1 Bond - cross 1 Q. That is prepared by the bank, the lender? 2 A. That's correct. 3 Q. So if the closing -- if the final loan application had been 4 prepared prior to July 27, as of that date, there would have 5 been no outstanding mortgage on Patton Drive, would there? 6 MR. CARBONE: Objection. Hypothetical. 7 THE COURT: Objection sustained. 8 Q. The mortgage application that Ms. Annabi had with respect 9 to Patton Drive, that went into effect on the date of the 10 closing for Patton Drive where she signed the mortgage 11 instrument, July 27 of '04? 12 A. Correct. 13 Q. Prior to July 27 of '04, there was no mortgage on Patton 14 Drive relating to Ms. Annabi, correct? 15 A. That's correct. 16 Q. Now, with respect to the occupancy affidavit -- 17 MR. ARONWALD: Can we have that back up again, the box 18 checked under paragraph 2. 19 Q. -- that simply requires that the borrower occupy the 20 premises within 60 days from the closing date, correct? 21 A. Correct. 22 Q. At the closing, did Ms. Annabi ever tell you that she did 23 not intend to occupy 45 Bacon Place as her principal residence? 24 A. No. I don't recall any conversation on that. 25 MR. ARONWALD: Can we have Government Exhibit 472 up, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2118 C37UANN1 Bond - cross 1 please. If we could just have the portion with the Sandy 2 Annabi and the address, please, if we could just have that 3 magnified. 4 Q. So the date of this was February 17 of 05. This letter, 5 according to the letter, was sent to Ms. Annabi at 245 Rumsey 6 Road in Yonkers, correct? 7 A. Correct. 8 MR. ARONWALD: Could we have the document restored. 9 Q. Can you just explain what this letter relates to? 10 A. It encompasses a few items. The top part of the letter 11 encompasses a transaction that occurred at 13 Patton that had 12 fallen through that did not close. 13 Q. Let me interrupt you there. The transaction that we are 14 talking about is not Ms. Annabi's purchase of 13 Patton Drive 15 in July of '04; this relates to Ms. Annabi's sale of 13 Patton 16 Drive, correct? 17 A. That's correct. 18 Q. So as I understand it, there was a contract of sale that 19 was executed, correct? 20 A. Yes. 21 Q. The attorney, the law firm that appears at the top of this 22 letter, Curto Schwartz Curto Bond, that is your firm? 23 A. That's right. 24 Q. And so you were representing her not in her capacity as 25 purchaser but as seller? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2119 C37UANN1 Bond - cross 1 A. Correct. 2 Q. Mr. and Mrs. Saunders, they were the purchasers of the 3 property? 4 A. That's correct. 5 Q. The contract having a mortgage contingency clause? 6 A. Yes. 7 Q. That means, if the buyer can't or doesn't obtain a 8 mortgage, then there is an out clause of the contract because 9 the contract is made contingent upon their ability to get a 10 mortgage? 11 A. That's correct. 12 Q. In this case, they could not get a mortgage commitment 13 letter within the time frame required by the contract, correct? 14 A. Yes. 15 Q. The contract had what is called a liquidated damages 16 clause, meaning that if the contract fell through because they 17 couldn't get a mortgage commitment letter, then they would 18 forfeit the amount of $2,500? 19 A. The standard clause would have been the deposit or 10 20 percent of what their deposit was. 21 22 (Continued on next page) 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2120 C37Qann2 Bond - Cross 1 BY MR. ARONWALD: 2 Q. OK. So whether it was ten percent or whether it was a 3 specific amount, whatever the terms of the contract were, the 4 contract provided that because they couldn't get their mortgage 5 commitment, they forfeited $2,500 to the seller; in this case, 6 Ms. Annabi, correct? 7 A. Correct. 8 Q. By the way, when they -- the sellers put a down payment on 9 the property, correct? 10 A. Yes. 11 Q. That down payment was held by you in your escrow account, 12 correct? 13 A. Correct. 14 Q. And it would stay there until the deal went through and 15 then at the closing the escrow funds would be released, 16 correct? 17 A. That's right. 18 Q. In this case, because the case didn't fall through, Ms. 19 Annabi was entitled to the $2,500 pursuant to the terms of the 20 contract? 21 A. That's right. 22 Q. Now, looking at the second paragraph -- sorry, it says in 23 the first paragraph if we can have that blown up. 24 So, according to this, it says: With your consent and 25 permission, the $2,500 was given to her father, Sami or Samir SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2121 C37Qann2 Bond - Cross 1 Annabi, correct? 2 A. That's correct. 3 Q. Just so we're clear, Ms. Annabi told you to give her father 4 that $2,500, correct? 5 A. Correct. 6 Q. And you did? 7 A. Yes. 8 Q. Could we just have it restored? Then the paragraph says 9 the second paragraph, if we can have that blown up. 10 So, at the same time there was a new sales contract 11 entered into where the buyers were Babykutty Samuel and Annuma 12 Baby as purchasers for the purchase price of $561,000, correct? 13 A. Yes. 14 Q. Again, you were only representing Ms. Annabi herself? 15 A. That's right. 16 Q. Here the contract called for a non-refundable deposit of 17 $20,000 which has been issued directly from the purchasers to 18 your name, correct? 19 A. Yes. 20 Q. So when you were shown before that $20,000 check -- if we 21 could just have that blown up, please. 22 MR. CARBONE: Do you have the number, Mr. Aronwald? 23 MR. ARONWALD: I think it's 472-A. 24 Q. So this check that is Government Exhibit 472-A dated 25 February 15 of '05, that's the $20,000 check that is referred SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2122 C37Qann2 Bond - Cross 1 to in your letter? 2 A. That's correct. 3 Q. So this check was issued to and given to Ms. Annabi? 4 A. Yes. 5 Q. If we go to 472-B. These checks are drawn on the attorney 6 trust account of Michael J. Curto. That's your firm, correct? 7 A. No. This check is his individual attorney trust account. 8 So, in this capacity, he was not representing the firm. 9 Q. What was his connection to the transaction? 10 A. He was the bank attorney on that transaction. 11 Q. OK. Then there are three checks, one of which -- and these 12 checks are dated March 24 of '05. The significance of that 13 date is what? Was that the closing date on Rumsey Road -- on 14 Bacon Place, rather? 15 A. These checks would have been issued on the closing date. 16 Q. Of Bacon Place? 17 A. No. No. 18 Q. Rumsey Road -- Patton Drive? 19 A. Yes, the sale of Patton Drive. 20 Q. So the $1,000 that is payable to you, that was your -- 21 A. That's my closing fee. 22 Q. OK. Then the check for $42,411 payable to Ms. Annabi, that 23 represents what? 24 A. That would represent the balance of the monies owed her as 25 seller from the buyer. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2123 C37Qann2 Bond - Cross 1 Q. With respect to the Bacon Place transaction, the loan 2 officer was Sam Hattar, H-A-T-T-A-R, correct? 3 A. I believe that's correct. 4 Q. Was he also the loan officer for Patton Drive as well? 5 A. I don't recall. 6 Q. Now, with respect to the HUD forms, do you recall that the 7 government asked you why the HUD form did not list the $60,000 8 note that Ms. Annabi had executed to Mr. Jereis? 9 A. I believe that was one of the questions, yes. 10 Q. And you told the government that you didn't consider a note 11 a mortgage which is required to be listed on the HUD forms, 12 correct? 13 A. I'm not sure of my answer to them on that. 14 Q. Well, based upon your experience, is it your belief and 15 understanding -- withdrawn. Do you consider a promissory note 16 a mortgage which is required to be listed on the HUD forms? 17 A. No, I don't. 18 Q. By the way, with respect to the Rumsey Road transaction, do 19 you recall that when the sales contract came in, the contract 20 came in from the seller of the co-op apartment that she was 21 purchasing, Sandy came into your office and signed it, correct? 22 A. That would have been the typical procedure. 23 Q. There was a deposit of $7,200? 24 A. I'd have to see the contract, but that sounds correct. 25 Q. Could we have the contract for Rumsey Road, please, put up. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2124 C37Qann2 Bond - Cross 1 I believe that's exhibit -- bear with me -- 2 MR. CARBONE: It's 510. 3 Q. 510. Could we just go to the right-hand portion, the 4 middle of the page, box number 1.13, could we just have those 5 lines? Do you see the line 1.16.1? 6 A. Yes. 7 Q. So the contract deposit was $7,200? 8 A. That's correct. 9 Q. That $7,200 came from Sandy Annabi's account, isn't that 10 so? 11 A. I believe so, yes. 12 Q. Did you ever have any discussions with Sandy Annabi as to 13 why she was purchasing the 245 Rumsey Road co-op? 14 A. I don't recall any with her, no. 15 MR. ARONWALD: Thank you. No further questions. 16 THE COURT: Mr. Siano. 17 MR. SIANO: May I have a moment to speak to 18 Mr. Carbone? He was otherwise engaged. 19 (Pause) 20 CROSS-EXAMINATION 21 BY MR. SIANO: 22 Q. Good morning, Mr. Bond. 23 A. Good morning. 24 Q. We've met before, of course. 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2125 C37Qann2 Bond - Cross 1 Q. How are you today? 2 A. I'm good, thanks. 3 Q. You know I represent Mr. Jereis? 4 A. Yes. 5 Q. Mr. Bond, you have talked about, in essence, four separate 6 closings? 7 A. That's correct. 8 Q. Three buys; one sell? 9 A. Correct. 10 Q. On each of these closings, you customarily prepare a 11 closing statement, is that correct? 12 A. That's correct. 13 Q. Do you list all the attendees or do you just list standard 14 names and fill in blanks on the cover sheet? 15 A. The way I do it is usually just standard: Buyer's 16 attorney, seller's attorney, not all of the attendees. 17 Q. Right. So you don't list real estate agents and other 18 attendees? 19 A. I don't usually. 20 Q. I wanted to just clear that up. 21 Now, in 469, Mr. Turk, if I could impose upon your 22 good assistance. 23 MR. SIANO: May I approach? 24 THE COURT: Yes. 25 Q. It's pretty simple. We don't need it, Mr. Turk. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2126 C37Qann2 Bond - Cross 1 Mr. Bond, you have in front of you Government Exhibit 2 469 in evidence? 3 A. That's correct. 4 Q. That's your closing statement? 5 A. Yes. 6 Q. For the acquisition of the Patton Drive property? 7 A. That's correct. 8 Q. That's the buy side of Patton Drive? 9 A. That's right. 10 Q. And then Patton Drive got sold, I think, in February of the 11 following year? 12 A. Correct. 13 Q. Just wanted to clear up what we're talking about. 14 Now, on that transaction, the contract deposit was 15 approximately 20 percent of the purchase price, isn't that 16 right? 17 A. That's correct. 18 Q. In your experience in 2004, would it be fair to say that 19 was a fairly high percentage of the purchase price? 20 A. Typical deposits are ten percent. 21 Q. And in the Halcyon days of expanding real estate prices, 22 the percentages went down because the purchase prices got so 23 large, isn't that right? You saw that happening as a custom 24 and practice? 25 A. Generally, yes, I agree with that. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2127 C37Qann2 Bond - Cross 1 Q. So a 20 percent deposit would be large both in terms of a 2 $500,000 purchase price and in terms of the market at that 3 time. In other words, the seller was asking for a large 4 percentage down? 5 A. Correct. 6 Q. In connection with this property, your closing statement 7 also lists that there were two mortgages, a first and a second? 8 A. That's correct. 9 Q. In total, they totaled below the purchase price of the 10 property, isn't that right? 11 A. They did. 12 Q. Nevertheless, when you take into account the 20 percent 13 deposit, the mortgages left an excess, isn't that right? 14 A. That's correct. 15 Q. Again, had the deposit been lower, those mortgage amounts 16 would nonetheless be what they were but there might not have 17 been an excess, is that right? 18 A. Correct. 19 Q. It was out of the excess proceeds from the two mortgages 20 that the $23,000 check to Mr. Jereis was written? 21 A. That's correct. 22 Q. As far as you know, that was written out of what account? 23 A. The money was written out of my account, my escrow account. 24 Q. To your knowledge, has that check remained unnegotiated or 25 to your knowledge did it clear? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2128 C37Qann2 Bond - Cross 1 A. I believe it cleared. 2 MR. SIANO: Thank you. No further questions. 3 MR. CARBONE: May I? Your Honor. 4 THE COURT: What choice do I have, Mr. Carbone? 5 REDIRECT EXAMINATION 6 BY MR. CARBONE: 7 THE COURT: I always wanted to answer that question 8 no. 9 BY MR. CARBONE: 10 Q. Mr. Bond, do you remember a few minutes ago Mr. Aronwald 11 asked you about where the deposit of the down payment came from 12 for the Rumsey Road property? 13 A. Yes. 14 Q. Do you recall answering that it came from Sandy Annabi? 15 A. Rumsey Road deposit, yes. 16 Q. Mr. Turk, would you please broadcast Government Exhibit 702 17 in evidence? I'm sorry, 202. 18 Now the deposit was $7,200? Would you please read the 19 date of the check? 20 A. November 30, 2004. 21 Q. Who is that check from? 22 A. That check is from Zehy Jereis. 23 Q. Who is it written to? 24 A. Sandy Annabi. 25 Q. Can you read the memo line, please? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2129 C37Qann2 Bond - Redirect 1 A. It says 245 Rumsey Road. 2 Q. That's $7,200? 3 A. That's correct. 4 Q. Thank you. 5 Mr. Aronwald asked you whether at the closing for the 6 Bacon Place property whether Ms. Annabi ever told you that she 7 did not intend to occupy Bacon Place property, do you recall 8 that? 9 A. Yes. 10 Q. Three days earlier at the Patton property closing, did she 11 tell you that she didn't intend to occupy Patton? 12 A. I don't recall a conversation like that. 13 Q. Mr. Turk, would you broadcast Government Exhibit 525? 14 This is the HUD-1 settlement statement for the closing 15 at Rumsey Road property which took place in February of '05, do 16 you recall that? 17 A. Yes. 18 Q. About how many months after the Bacon closing did the 19 Rumsey closing take place? 20 A. About six months, seven months. 21 Q. What change to the address did Ms. Annabi make? 22 A. The address at the top is changed from 45 Bacon Place to 53 23 Linden Street. 24 Q. Now, Mr. Aronwald also asked you about whether a promissory 25 note is a debt that needs to be disclosed on a HUD-1 settlement SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2130 C37Qann2 Bond - Redirect 1 statement, do you recall that? 2 A. Yes. 3 Q. Mr. Turk, would you broadcast Government Exhibit -- 4 MR. ARONWALD: Mischaracterizes the question, your 5 Honor. 6 THE COURT: We'll deal with that later. Remember, 7 it's the jury's recollection of these matters that matter; not 8 the lawyers'. 9 Q. Mr. Turk, would you broadcast Government Exhibit 451? This 10 is the loan application. Can you go to page 2, please for the 11 13 Patton Drive property. 12 On the right-hand column where it says liabilities -- 13 first of all, when did the Patton property closing take place? 14 A. The Patton property closing was in July of 2004. 15 Q. And the promissory note that you drafted for Ms. Annabi and 16 Mr. Jereis, what date was that? 17 A. That was dated in June. 18 Q. So the closing for Patton takes place after the promissory 19 note, right? 20 A. That's correct. 21 Q. Can you look in the liability section on the application? 22 Tell us whether Ms. Annabi disclosed that promissory note to 23 the lender? 24 A. I don't see it listed here. 25 Q. Would you also, please, Mr. Turk, broadcast Government SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2131 C37Qann2 Bond - Redirect 1 Exhibit 481. This is the loan application typewritten version 2 for the 45 Bacon property. Can you turn to page 2, please. 3 Mr. Turk, would you maximize the liability side of the page. 4 Do you see anywhere on that page where Ms. Annabi 5 disclosed that $60,000 promissory note as a liability? 6 A. No. 7 MR. CARBONE: Thank you. No further questions. 8 Excuse me. 9 MR. ARONWALD: No questions, your Honor. 10 MR. SIANO: No questions. 11 THE COURT: Well, they haven't said they're done 12 asking yet. I mean, they said it, but then they said -- 13 MR. ARONWALD: I'm sorry. 14 BY MR. CARBONE: 15 Q. My apologies. Mr. Turk, could you go back to 481? And go 16 to page 3. Please maximize the declaration section again. 17 Can you tell us again how Ms. Annabi responded when 18 asked if any part of the down payment was borrowed? 19 A. The box that's checked is no. 20 Q. And that document is created after the promissory note, 21 correct? 22 A. I wouldn't know that for sure. 23 Q. Well, when was the closing at Patton? 24 A. Patton closing was in July. 25 Q. When was the closing for Bacon? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2132 C37Qann2 Bond - Redirect 1 A. In July. 2 Q. Is that after the June promissory note? 3 A. That's correct. 4 MR. CARBONE: Thank you. 5 THE COURT: Anything else? 6 MR. CARBONE: No, your Honor. 7 MR. ARONWALD: No questions, your Honor. 8 MR. SIANO: No questions. 9 THE COURT: Let's take a break. Don't discuss the 10 case. Keep an open mind. 11 Thank you, Mr. Bond. You're done. 12 (Witness excused; recess) 13 (In open court; jury present) 14 THE COURT: Call your next witness, please. 15 MR. HALPERIN: Your Honor the government calls Kenneth 16 Bicknese. 17 KENNETH BICKNESE, 18 called as a witness by the Government, 19 having been duly sworn, testified as follows: 20 DIRECT EXAMINATION 21 BY MR. HALPERIN: 22 THE DEPUTY CLERK: Tell us your full name. 23 THE WITNESS: Kenneth Bicknese. 24 THE DEPUTY CLERK: Spell Bicknese. 25 THE WITNESS: B-I-C-K-N-E-S-E. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2133 C37Qann2 Bicknese - Direct 1 THE COURT: You may inquire. 2 MR. HALPERIN: Thank you, your Honor. 3 BY MR. HALPERIN: 4 Q. Good morning, Mr. Bicknese. 5 A. Good morning. 6 Q. What city do you live in, sir? 7 A. Somers, New York. 8 Q. How long have you lived there? 9 A. Eight years. 10 Q. What do you do for work, sir? 11 A. I am a mortgage broker. 12 Q. Do you want to move the microphone right in front of you? 13 Thank you. 14 A. OK. 15 Q. For what company do you work as a mortgage broker? 16 A. Nationwide Equities. 17 Q. How long have you been with Nationwide Equities? 18 A. Since 2004. 19 Q. How long have you worked as a mortgage broker? 20 A. Since 1997, 15 years. 21 Q. What does Nationwide Equities do? 22 A. We arrange loans for purchases or re-finances of homes. 23 Q. Let me direct your attention to 2004. What did Nationwide 24 Equities do at that point? 25 A. We brokered loans primarily in New York State. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2134 C37Qann2 Bicknese - Direct 1 Q. Generally, please explain what does a mortgage broker do? 2 A. A mortgage broker arranges a loan with an end lender and 3 gets compensated from the lender for providing the loan. 4 Q. So directing you again to 2004, when a new customer came to 5 you at Nationwide seeking a mortgage, what would you do for 6 that customer? 7 A. I would contact various banks and price out the loan to see 8 which was the best fit for the client's needs. 9 Q. Sir, do you know someone named Sandy Annabi? 10 A. Yes. 11 Q. How do you know her? 12 A. She was a client of mine. 13 Q. Did you help her get a mortgage for property in Yonkers? 14 A. I did. 15 Q. What was the address in Yonkers? 16 A. 13 Patton Drive. 17 Q. What year did this deal take place? 18 A. 2004. 19 Q. Where were your offices located at the time in 2004? 20 A. I was located on Seminary Avenue in Yonkers. 21 Q. Who, if anyone else, did you meet from Ms. Annabi's family 22 during this transaction? 23 A. Her father. 24 Q. What was his name? 25 A. Sami. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2135 C37Qann2 Bicknese - Direct 1 Q. What was her father's involvement in Ms. Annabi's mortgage 2 process? 3 A. He was a hands-on, you know, father, adviser. 4 Q. Now, which bank did you end up using to get a mortgage for 5 Sandy Annabi? 6 A. Fremont Investment and Loan. 7 Q. Did you meet with Ms. Annabi to review the information 8 contained in the mortgage application? 9 A. Yes. 10 Q. Where did you have those meetings with Ms. Annabi in 2004 11 relating to this loan? 12 A. At 5 Seminary Avenue. 13 Q. Your office? 14 A. My office, correct. 15 Q. How would you characterize Ms. Annabi's understanding of 16 the mortgage process? 17 A. I think she was a savvy borrower who understood the 18 process. 19 Q. What makes you say that? 20 A. She asked all the right questions, and actually made my job 21 easier as time went by that she asked those same questions 22 later. 23 Q. What types of questions, if any, did she ask about the 24 different types of rates that might be available? 25 A. Just general things: What affects the rates, what if I put SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2136 C37Qann2 Bicknese - Direct 1 this much money down or more money down, or less money down, 2 you know, different programs, interest only, full amortization, 3 things of that nature. 4 Q. When Ms. Annabi was applying for the mortgage, what, if 5 anything, did she tell you about whether this property 13 6 Patton Drive was going to be her primary residence? 7 A. We did the application that she was going to have it as a 8 primary residence. 9 Q. Where, if anywhere, in the application documents did 10 Ms. Annabi have to certify that 13 Patton Drive would be her 11 primary residence? 12 A. It's mentioned in two spots on the application. It's on 13 the front page of the application, and on the third page of the 14 application there's a declaration section where you would 15 certify that you're going to be living in the residence. 16 Q. Mr. Turk, can we please have Government Exhibit 451 which 17 has been received by the Court? Let's start with page 1. Blow 18 up the top half of the document, please. 19 Sir, do you recognize this document? 20 A. Yes, that's a mortgage application. 21 Q. For whom is this mortgage application? 22 JUROR: Excuse me. Our screens are not showing this. 23 THE COURT: Really? What's going on? 24 JUROR: They're dark. It's half. 25 THE DEPUTY CLERK: Dark or? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2137 C37Qann2 Bicknese - Direct 1 JUROR: Blank. 2 THE DEPUTY CLERK: Does anybody have it? 3 JUROR: Front row has it on. Back two rows don't have 4 it. 5 THE COURT: This is the first time this has been a 6 problem this morning? 7 JUROR: Right. 8 THE COURT: Somebody must have kicked something. 9 THE DEPUTY CLERK: They're on, but the image is 10 skewed. It's not like the signal is not getting through. 11 There is something wrong on the monitors. 12 THE COURT: Well, that's odd because it's quite clear 13 on mine. 14 MR. ARONWALD: It's on here. 15 THE COURT: It's on here, on here, and it's not on for 16 some of the jurors. We wouldn't happen to have a few copies of 17 this document would we so we could get moving with this 18 witness? 19 MR. HALPERIN: Judge, we will try to use -- 20 THE COURT: The government doesn't know what to do. 21 So we will try to use the Elmo and the highlighter to bring it 22 up, to bring pieces of it up as you ask questions about it. 23 Does Mr. Turk have that ability? 24 MR. HALPERIN: Absolutely. Judge, can I turn this 25 monitor around for these two jurors? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2138 C37Qann2 Bicknese - Direct 1 THE COURT: You may try to get whatever information to 2 the jurors you can. What I hope the government is going to do 3 is to highlight and make larger on the big screen portions of 4 the document. No, apparently the government isn't capable of 5 doing that in this case. All right. It's over-teched. 6 We've got to get going. We've got to ask questions. 7 Must ask questions. Folks, you may not be able to see the 8 document at this time. You'll have it in the jury room. 9 Q. Mr. Bicknese, can you see the documents in front of you, 10 sir? 11 A. Yes. 12 Q. So let me show you the top part of this document. First of 13 all, did you review this document before your testimony here 14 today? 15 A. Yes. 16 Q. Who is the borrower on this application? 17 A. Sandy Annabi. 18 Q. What's the address? 19 A. 13 Patton Drive, Yonkers, New York, 10701 in this case. 20 Q. Why don't you take us and the jury through the top portion 21 of the document? Just tell us what this information is on this 22 document? 23 A. The first line, the box is checked off that it's a 24 conventional mortgage. The next box that's completed is a loan 25 amount. In this case, it's $50,600. The interest rate on the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2139 C37Qann2 Bicknese - Direct 1 next box, which is 9.25. The next box is -- it's 30-year 2 mortgage due in 30 years, so it's called a 360/360. 3 Q. Let me pause. Mr. Turk, let's see if we can blow up on the 4 big screen the next line down, purpose of loan, all the way 5 across, if we could maximize that. Maybe the jurors can see it 6 from their seats. Take us through this information, 7 Mr. Bicknese. 8 A. The purpose of loan is checked off that it's purchase. And 9 the second box to the right is checked off that it will be a 10 primary residence. 11 Q. Who would have provided that information that this will be 12 a primary residence? 13 A. This would have been completed during the original meeting 14 or mortgage application. 15 Q. So who provides it for this particular application? 16 A. In this particular case, the borrower; it would have been 17 Sandy Annabi would have provided that. 18 Q. Mr. Turk, let's highlight the box in the middle of the 19 page, borrower information. What is this information, 20 Mr. Bicknese? 21 A. This is the personal borrower information. It's Sandy 22 Annabi's name, the personal, you know, social security number, 23 home phone numbers, birth dates, addresses. 24 Q. What's the address listed? 25 A. 51 Linden Street, Yonkers, New York. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2140 C37Qann2 Bicknese - Direct 1 Q. Let's go to page 2, Mr. Turk. Let's highlight the top 2 quarter of the page. 3 What's the heading on Roman numeral V, Mr. Bicknese? 4 A. That's the income and housing expense section of the 5 application. 6 Q. Does it say monthly income and combined housing? 7 A. Yes, monthly income and combined housing expense 8 information. 9 Q. What's the borrower's base employment income that's listed 10 monthly? 11 A. $5,000. 12 Q. And other income? 13 A. $3,583. 14 Q. For a total monthly income of what? 15 A. $8,683. 16 Q. Mr. Turk, let's go to page 3. Let's just highlight the 17 declarations box on the right side of the middle. 18 Sir, what is listed in line H, if you could read it 19 aloud and say what the answer is? 20 A. Is any part of your down payment borrowed? 21 Q. And the answer? 22 A. The borrower's answer is no. 23 Q. What about line L? 24 A. Do you intend to occupy the property as your primary 25 residence? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2141 C37Qann2 Bicknese - Direct 1 Q. The borrower's answer? 2 A. Yes. 3 Q. Now, how, Mr. Bicknese, important is it for a lender to 4 know whether a borrower plans to live at the property? 5 A. It's very important. It's how they determine what the down 6 payment could be. It's how they determine what the rate would 7 be, and the risk of the loan. 8 Q. Now, Mr. Turk, can we highlight the signature section 9 there, please. 10 Whose name is listed there, Mr. Bicknese? 11 A. Sandy Annabi. 12 Q. And the date? 13 A. July 27, 2004. 14 Q. Thank you, Mr. Turk. Let's look at Government Exhibit 452. 15 Let's crop in as close as we can on the top third of the 16 document. Right there is great. 17 Mr. Bicknese, what is this document, sir? 18 A. This is a Fremont prequal form they call it a submission 19 form. 20 Q. What is the purpose of a prequal submission form? 21 A. This is a form, our account executive from Fremont 22 Investment and Loan would look at the application and credit 23 record and give us, you know, their best price options or their 24 best loan options and for us, you know, considering to use them 25 as a bank. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2142 C37Qann2 Bicknese - Direct 1 Q. What's the information under property information on the 2 right side of what's up on the screen? 3 A. It says that the property would be in New York State; that 4 it's single-family residence; it will be an owner occupied 5 residence; and the sales price would be $506,000. 6 Q. On the left side, the applicant's name? 7 A. Sandy Annabi. 8 Q. Mr. Turk, let's highlight the left middle box under Fremont 9 prequal, the left -- right about there is just perfect. 10 Take us through, Mr. Bicknese, this information and 11 what it contains. 12 A. The first line is the credit grade, which is A plus. Then 13 the program, whether express or extreme is just how they're 14 going to process it internally. The minimum FICO income 15 required for this. 16 Q. Let's get to LTV, what does that mean? 17 A. LTV is loan to value. In this case, we were breaking the 18 loan up into two parts: The first loan being 85 percent of the 19 purchase price, and the second loan being ten percent of the 20 purchase price. 21 Q. Let me ask about that. So how many loans did Fremont 22 Investment and Loan make to this borrower for this property? 23 A. There would have been two loans. 24 Q. What were the interest rates on the two different loans? 25 A. There's a choice of interest rates. In this particular SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2143 C37Qann2 Bicknese - Direct 1 case, the interest rate of 6.3 was chosen for the first loan; 2 and the second loan I think wound up being less, but it was 3 originally qualified here at 9 and a half. 4 Q. Now, what effect would it have had on the interest rates 5 had this not been a primary residence? 6 A. The interest rates would have been higher. 7 Q. Why is that? 8 A. Because there's more risk and there's add-ons from all 9 banks for investment properties. 10 Q. Mr. Turk, could we have Government Exhibit 450, please. 11 Let's just highlight the top third of the document. 12 Mr. Bicknese, what is Government Exhibit 450? 13 A. That is a standard real estate contract. 14 Q. In this case, who is it between? 15 A. Larry Lieberman and Hermine Lieberman. 16 Q. And who else -- I'm sorry, which party were they: Seller 17 or purchaser? 18 A. They would have been the seller. Here they are called the 19 seller, and Sandy Annabi the purchaser. 20 Q. What's the date that's written in in handwriting there? 21 A. May 7, 2004. 22 Q. What's the address that this property relates to? 23 A. 13 Patton Drive, Yonkers, New York. 24 Q. Mr. Turk, can we have page 8 of this document? Just the 25 top quarter of the page, please. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2144 C37Qann2 Bicknese - Direct 1 Whose name is written there, sir, on the upper right 2 side, I should say? 3 A. On the right side, the purchaser's name, and signature 4 Sandy Annabi. 5 Q. Thank you, Mr. Turk. Let's look at 453-C, also in 6 evidence. 7 What is this, sir? 8 A. This is a pay stub. 9 Q. Related to which borrower? 10 A. Sandy Annabi. 11 Q. What's the deposit date? 12 A. April 22, 2004. 13 Q. And the gross year to date, on the right side? 14 A. $18,396.08. 15 Q. Let's go to Government Exhibit 453-D. Again, what is this, 16 sir? 17 A. This is also a pay stub. 18 Q. From what entity, if you look at the top middle of the 19 document? 20 A. St. Joseph's Medical Center. 21 Q. Would these documents have been part of the application 22 process? 23 A. Yes. 24 Q. What's the deposit date on this item? 25 A. May 6, 2004. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2145 C37Qann2 Bicknese - Direct 1 Q. At that point the gross year to date? 2 A. $20,796.60. 3 Q. Mr. Turk, can we have Government Exhibit 454 also in 4 evidence? Let's highlight the top half of the page -- 5 actually, I'm sorry, if we can go back up, to two-thirds of the 6 page, right to there. 7 What is this document, Mr. Bicknese? 8 A. This is an address certification. 9 Q. What's the purpose of this document? 10 A. This is a document signed at closing to make the bank aware 11 where to mail the mortgage statements. 12 Q. What's the date listed at the top? 13 A. July 27, 2004. 14 Q. Two lines down, the borrower name? 15 A. Sandy Annabi. 16 Q. What's the property address listed there? 17 A. 13 Patton Drive, Yonkers, New York. 18 Q. What was the original zip code and type? 19 A. 10701. 20 Q. And was there a crossout there? 21 A. Yes, it was crossed out and corrected to 10710. 22 Q. What initials are shown there? 23 A. SA. 24 Q. Now, right underneath that item says borrower complete 25 mailing address is as follows: What's the address listed SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2146 C37Qann2 Bicknese - Direct 1 there? 2 A. 45 Bacon Place, Yonkers, New York, 10710. 3 Q. What was the borrower saying about where she wanted her 4 mail sent? 5 A. That she would want her mail sent to 45 Bacon Place, 6 Yonkers, New York. 7 Q. How, if at all, does that address match the address on 8 Ms. Annabi's loan application? 9 A. It doesn't. 10 Q. What's your understanding about why she listed a different 11 address where she wanted to get her mail? 12 MR. ARONWALD: Objection, your Honor. 13 BY MR. HALPERIN: 14 Q. Sir, if you know. 15 THE COURT: If Ms. Annabi said -- did Ms. Annabi tell 16 you why she wanted to get her mail at that address? 17 THE WITNESS: No. 18 THE COURT: Fine. Then there's no basis to ask the 19 question. 20 Q. Mr. Turk, let's go to Government Exhibit 457. Let's 21 highlight the top third of the document, please. That's 22 perfect. 23 Now, whose document is this, sir? 24 A. This is a document generated by Nationwide Equities or even 25 myself as part of the initial loan application. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2147 C37Qann2 Bicknese - Direct 1 Q. What's the purpose of this document? 2 A. This document is -- we send this to third parties to 3 release information about the borrowers. So, for example, if I 4 was to need an employment verification filled out, I would fax 5 over a form along with this document, and that gives permission 6 for that employer to give me the information I requested. 7 Q. Mr. Turk, let's maximize the bottom portion of this 8 document. Right there is great. 9 Whose name is listed at the bottom? 10 A. Sandy Annabi. 11 Q. What's the date? 12 A. May 3, 2004. 13 Q. What does that date signify to you? 14 A. That would have been the date that the document was signed 15 and/or generated within a day or two before that. 16 (Continued on next page) 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2148 C37UANN3 Bicknese - direct 1 MR. HALPERIN: Mr. Turk, can we go back up to the 2 first paragraph and highlight the first paragraph. 3 Q. Mr. Bicknese, could you read this first paragraph? 4 A. "The undersigned certified the following: I/we have 5 applied for a mortgage loan from Nationwide Equities 6 Corporation. In applying for the loan, I/we will complete the 7 loan application containing various information on the purpose 8 of the loan, the amount and the source of the down payment, 9 employment and income information, and the assets and 10 liabilities. I/we certify that all of the information is true 11 and complete. I/we made no misrepresentations in the loan 12 application or other documents, nor did I/we omit any pertinent 13 information" 14 MR. HALPERIN: Mr. Turk, 459, also in evidence. 15 Q. What is this document, Mr. Bicknese? 16 A. That is a request for verification of rent. 17 Q. What is the purpose of this document? 18 A. To verify that the applicant has paid their rent on time. 19 Q. Based on this form, what does this form indicate to you? 20 A. It indicates that she was renting and has paid her rent on 21 time and was never late. 22 MR. HALPERIN: Mr. Turk, let's maximize the first top 23 half of that document right to there. 24 Q. In box 1, sir, what is listed? 25 A. Box 1 is the landlord. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2149 C37UANN3 Bicknese - direct 1 Q. What does it say? 2 A. Randa Rabada. 3 Q. At what address? 4 A. 51 Linden Street, Yonkers, New York. 5 Q. Do you know who that is, sir? 6 A. I do. 7 Q. What if anything did Sandy Annabi tell you about her 8 relationship with Randa Rabada? 9 A. I was introduced to Randa Rabada as her aunt. 10 MR. HALPERIN: Thank you, Mr. Turk. 11 Government Exhibit 463, please. Let's just blow up 12 the top quarter of that page to make it easy for the jurors. 13 Right there is great. 14 Q. What is Government Exhibit 463, sir? 15 A. That is an adjustable rate note. 16 Q. Explain -- just walk us through the information on the top 17 part of this document. 18 A. It is a promise to repay for a mortgage that closed on July 19 27, 2004, for 13 Patton Drive in Yonkers, New York 10710 and 20 the loan amount -- the promise to repay $430,100 and the 21 lender, Fremont Investment and loan. 22 Q. Is this the note for the primary or secondary mortgage on 23 the property? 24 A. This is for the first mortgage on the property. 25 Q. The bigger one? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2150 C37UANN3 Bicknese - direct 1 A. The bigger, the first mortgage note, the 85 percent. 2 MR. HALPERIN: Thank you, Mr. Turk. 3 Q. You said before, Mr. Bicknese, so how many loans did 4 Ms. Annabi get in the summer of 2004 from Fremont? 5 A. Two. 6 Q. For the one property? 7 A. Two for one property, correct? 8 Q. During the time that you were working on getting Ms. Annabi 9 a mortgage on 13 Patton Drive in Yonkers, what if any 10 discussions did you have with Ms. Annabi where she asked about 11 another mortgage? 12 A. She indicated that she was buying another property and she 13 asked me to quote her an interest rate for that property. 14 Q. Tell us about that conversation. 15 A. I let her know what the interest rate would be, what the 16 terms would be and that it would be higher than the original 17 loan. 18 Q. Why would the interest rate be higher than the original 19 loan? 20 A. Because she couldn't apply for two primary residences at 21 the same time, so I would have to make one of them an 22 investment property. 23 Q. And what interest rates do investment properties have as 24 compared to primary residences? 25 A. It depends on the loan to value and the credit score but, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2151 C37UANN3 Bicknese - direct 1 typically, a quarter to a half a percent higher. 2 Q. So assuming the same loan-to-value and credit score and all 3 other things being equal, generally what is the difference -- 4 not in terms of size, but which one has the higher interest 5 rate? 6 A. Investment properties have higher interest rates. 7 Q. What if any discussions did you have about whether she 8 could apply for two loans for primary residences at the same 9 time? 10 A. Well, I just told her that, that couldn't be done. 11 Q. What happened after your discussions? 12 A. I never discussed it again with her. She didn't apply for 13 a mortgage with me for any other property. 14 MR. HALPERIN: Thank you, sir. 15 Nothing further. 16 THE COURT: OK, Mr. Aronwald. 17 MR. ARONWALD: I just need a few minutes. 18 THE COURT: I know. 19 CROSS-EXAMINATION 20 BY MR. ARONWALD: 21 Q. Is it Bicknese or Bicknese? 22 A. Bicknese. 23 Q. Thank you. I just wanted to make sure I pronounced it 24 correctly. 25 Is a mortgage broker the same thing as a loan officer? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2152 C37UANN3 Bicknese - cross 1 A. Not really, no. I mean, the terms are interchangeable in 2 some cases. 3 Q. Well, would it be more accurate to say that you are a 4 mortgage broker or a loan officer? 5 A. A loan officer. 6 Q. That would be more accurate? 7 A. Yes. 8 Q. So you testified when you took the stand that you are a 9 mortgage broker? 10 A. Correct. 11 Q. So are you both a mortgage broker or a loan officer? 12 A. A mortgage broker is the job; loan officer is the title. 13 Q. So a loan officer is basically the person that essentially 14 initiates the paperwork for the loan, correct? 15 A. Correct. 16 Q. You said when you began your direct examination and correct 17 me if I am wrong, that in 2000 -- strike that. 18 You testified on direct examination that a mortgage 19 broker, the job of a mortgage broker is to arrange loans? 20 A. Correct. 21 Q. And you said that in 2004 your employer, Nationwide 22 Equities, brokered loans principally in New York state? 23 A. Correct. 24 Q. What does brokering a loan mean? 25 A. Brokering a loan means that a company like Nationwide SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2153 C37UANN3 Bicknese - cross 1 Equities provides a mortgage application to a mortgage banker 2 or mortgage lender or any other institution that eventually 3 would provide the money for the purchase of a home. 4 Q. I believe you said that the loan officer or mortgage broker 5 arranges the loans with the lender and gets paid by the lender 6 for arranging the loan? 7 A. I said that, yes. 8 Q. That's correct? 9 A. That's correct. 10 Q. Does that mean that if you can't find a lender for the 11 loan, you don't get paid? 12 A. I would say that's pretty accurate. 13 Q. Now, when you told Mr. Halperin that you get paid by the 14 lender for arranging the loan, is that a flat rate regardless 15 of the size of the loan or does the amount that the loan 16 officer gets paid change depending upon the size of the loan? 17 A. The compensation is a percentage based on the loan amount. 18 The higher the loan, the higher the dollar amount, but the 19 percentage could be the same. 20 Q. I'm sorry. The higher the loan, the higher the loan 21 amount? 22 A. Yes. For instance, if the bank is offering us 1 percent, 1 23 percent of 400,000 is less than 1 percent of 500,000. 24 Q. Is that a one-time payment or does that payment continue 25 over the period of the loan? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2154 C37UANN3 Bicknese - cross 1 A. No, that's a one-time payment. The lender pays you at the 2 closing table. 3 Q. So in this case, basically the amount of the loan was 4 506,000, is that correct? 5 A. No. 6 Q. What was the amount of the loan? I don't know. 7 A. The loan amount was two loans. The first loan was 430,100 8 and the second loan was 50,600. 9 Q. Are these viewed as two separate loans? 10 A. Yes. They are two completely separate loans. 11 Q. Does that mean that you as the loan officer would be paid a 12 percentage of the two loans? For each loan, you would be paid 13 separately, correct or not correct? 14 A. That could be. In this particular case, we did not take 15 compensation on second loans. 16 Q. So then you only got compensated based on the $430,000 loan 17 not the $50,600 loan? 18 A. Correct. 19 Q. Do you recall what the percentage was that you got paid for 20 the $430,100 loan in 2004? 21 A. I believe it was 1 percent. 22 Q. You also testified that you met Sami Annabi, Ms. Annabi's 23 father in 2004, correct? 24 A. Yes. 25 Q. You said that he was a "hands-on father advisor." Do you SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2155 C37UANN3 Bicknese - cross 1 recall saying that? 2 A. Yes. 3 Q. Hands-on in what way? 4 A. He attended our meeting to do the mortgage application. 5 Q. Did he take any more active role than just attending the 6 meeting? 7 A. He asked questions related to the mortgage application. 8 Q. Well, aside from sitting in on the meetings, was he part of 9 the interview process? Did he provide some of the information? 10 A. I don't believe so. 11 Q. Well, was he part of the interview process in any other 12 way? 13 A. No. 14 Q. Do you remember testifying before the grand jury on 15 September 23, 2008? 16 A. I do. 17 Q. Do you recall that when you appeared before the grand jury 18 you were testifying under oath, correct? 19 A. Correct. 20 Q. Same oath as you took here, right? 21 A. Correct. 22 Q. Do you recall being asked this question and giving this 23 answer at page 11, lines 8 through 18: 24 "Q Did you also meet anyone else from Sandy Annabi's family 25 during this transaction? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2156 C37UANN3 Bicknese - cross 1 "A Yes. Her father, Sami Annabi. 2 "Q Sami is S-A-M-I? 3 "A Yes. 4 "Q He was involved in Sandy's mortgage process? 5 "A Yes. He sat in on the interview and was kind of part of 6 the interview process." 7 Do you recall being asked those questions and giving 8 those answers? 9 A. I recall the basis of the question, yes. 10 Q. Do you recall being asked those questions and giving those 11 answers? 12 A. I don't recall the exact wording of questions I was asked. 13 Q. You don't recall whether you told them that Mr. Sami Annabi 14 was kind of part of the interview process? 15 A. That would have been a way to answer, yes. 16 Q. Well, in what way was he kind of part of the interview 17 process? 18 A. Well, he asked basic questions like what if we put down 19 more money, what if we put down less money, what if we took one 20 loan, what if took two loans, what would the payment be if 21 there was interest, what would the payment be if there was not 22 interest -- things of that nature. 23 Q. Now, do you recall whether any of the information that you 24 asked for during the interview process was provided not by 25 Sandy Annabi but by her father, Sami Annabi? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2157 C37UANN3 Bicknese - cross 1 A. Information in what way, verbally? 2 Q. Yes. Verbally -- let me strike that. 3 Just so that we understand how the process works. You 4 sit down with the applicant, correct? You ask a series of 5 questions and the applicant answers your questions? 6 A. Correct. 7 Q. So that would be a verbal interview process, correct? 8 A. Correct. 9 Q. So during the verbal interview process that you had with 10 Sandy Annabi in the presence of her father, did her father 11 provide any of the answers to the questions that you asked? 12 A. I asked Sandy questions not him, so no. 13 Q. I understand that. So you are saying when you asked Sandy 14 questions, all of the information, all of the answers were by 15 Sandy and at no time did her father provide any of those 16 answers? 17 MR. HALPERIN: Objection. Asked and answered. 18 THE COURT: No. 19 Answer it yes or no. 20 THE WITNESS: Please say it again. 21 THE COURT: Did Sami Annabi answer any of the 22 questions that you asked Sandy Annabi? 23 THE WITNESS: No, not for the application. 24 THE COURT: Thank you. 25 BY MR. ARONWALD: SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2158 C37UANN3 Bicknese - cross 1 Q. Now, with respect to the loan application, and I am talking 2 now about the -- 3 (Discussion off the record among counsel) 4 MR. ARONWALD: Could we have Government Exhibit 451 5 put up, please? 6 THE COURT: Yes. 7 BY MR. ARONWALD: 8 Q. Did you have anything at all to do with the physical 9 preparation of this document? 10 A. No. 11 Q. Do you know who did? 12 A. Melanie Marks, my processor. 13 Q. Were you at the closing? 14 A. I don't recall if I attended the closing. 15 Q. Did you review Government Exhibit -- this Government 16 Exhibit, 451? 17 A. I reviewed this document, yes. 18 Q. Were you satisfied that the document was accurate after you 19 reviewed it? 20 A. There's a typo or two on there. 21 Q. Kind of substantial typo, wouldn't you say? 22 A. Yeah. 23 MR. ARONWALD: Let's magnify, if we can the box number 24 where it talks amount in the upper lefthand corner. 25 Q. Do you see the part that is highlighted where it talks SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2159 C37UANN3 Bicknese - cross 1 about amount? 2 A. Right. 3 Q. Indicates that the amount of the loan is $50,600? 4 A. Correct. 5 Q. And that is not correct, is it? 6 A. I don't know, I haven't reviewed the note. 7 Q. Didn't you review the note before you came in to testify 8 here today? 9 Mr. Bicknese, I'm just asking you some questions. 10 You indicated to Mr. Halperin that you had reviewed 11 these documents before you testified here? 12 A. Right. 13 Q. You reviewed the note before you came in, didn't you? 14 A. We just reviewed shortly ago the note on the first. I 15 don't recall what the loan amount was on the second note. 16 Q. Did you fill out two separate loan applications for two 17 separate loans? 18 A. Yes. 19 Q. So what typos are there in this document that you recognize 20 as typos? 21 A. The zip code is wrong. 22 Q. Now, you don't recall whether you were at the closing? 23 A. I do not recall -- 24 Q. Go ahead. I'm sorry. 25 Both loans closed on the same day? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2160 C37UANN3 Bicknese - cross 1 A. Simultaneous closings. This is called a purchase money 2 second. 3 Q. You also, I think, indicated that this was a subprime loan? 4 A. I did not mention that today. 5 Q. Was it a subprime loan? 6 A. It is not a conventional Fannie Mae loan. Subprime is a 7 word that we use to describe almost anything that is not a 8 Fannie Mae loan. It is an alternative lenders. There are many 9 names for them, but it was not a standard Fannie Mae loan. 10 Q. Well, with respect to the loan application, I think Mr. 11 Halperin asked you to describe or run the jury through the 12 information that is listed on the document itself, and you 13 indicated that this was considered a conventional loan and that 14 was the box that was checked. So just to clarify any 15 confusion, if it is not a conventional loan, then why is this 16 conventional box checked? 17 A. It is a conventional loan, meaning that it meets the 18 conventional guidelines. It is not a Fannie Mae loan. 19 Conventional and Fannie Mae are two different things. 20 Q. What is a subprime loan? 21 A. A subprime loan is one that is beneath prime. 22 Q. Wasn't this loan placed with Fremont Investment and Loan, a 23 subprime lender? 24 A. Some people call them subprime lenders, yes. 25 Q. Did you -- SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2161 C37UANN3 Bicknese - cross 1 A. I don't refer to them as subprime lenders. 2 MR. HALPERIN: Objection. Relevance. 3 THE COURT: Objection sustained. 4 Q. Didn't you testify before the grand jury that Fremont 5 Investment and Loan is a subprime lender? 6 MR. HALPERIN: Objection. 7 THE COURT: Objection sustained. 8 Q. Now, you were also shown a number of documents. 9 MR. ARONWALD: Could we have 457 put up, please. 10 Q. Now, Mr. Halperin asked you to read the top portion under 11 "certification"? 12 A. Correct. 13 Q. What I would like you to do, is I would like you to read 14 the bottom half, "authorization to release information." 15 MR. ARONWALD: Your Honor, I don't know whether the 16 screens are working or not -- 17 THE WITNESS: Is it OK to read it? 18 THE COURT: You can read it to yourself. 19 THE WITNESS: He asked me to read it out loud. 20 Do you want me to read it out loud? 21 MR. ARONWALD: Yes. 22 BY MR. ARONWALD: 23 Q. I want you to read the authorization to release 24 information, just as you read aloud the top half of the 25 document. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2162 C37UANN3 Bicknese - cross 1 A. "To whom it may concern: I/we have applied for a mortgage 2 loan with Nationwide Equities Corporation. As part of the 3 application process, Nationwide Equities Corp and the mortgage 4 guarantee insurer, if any, may verify information contained in 5 my/our loan application and in other documents required in 6 connection with the loan, either before the loan is closed or 7 as part of its quality control program. I/we authorize you to 8 provide to Nationwide Equities Corp and to any investor to whom 9 Nationwide Equities Corp may sell my mortgage, any and all 10 information and documentation that they request. 11 Such information includes, but is not limited to, employment 12 history and income, bank, money market and similar account 13 balances, credit history, and copies of income tax returns. 14 Nationwide Equities Corp or any investor that purchases the 15 mortgage may address this authorization to any party named in 16 the loan application. A copy of this authorization may be 17 accepted as an original." 18 Q. This document is dated May 3, 2004, correct? 19 A. Correct. 20 Q. Did you at any time make any attempt to verify any of the 21 information Ms. Annabi had authorized you to obtain in 22 Government Exhibit 457? 23 A. The only time this form would have been used would have 24 been for rental verification on this file. 25 Q. This form is not limited to rental verification, is it? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2163 C37UANN3 Bicknese - cross 1 A. Limited to? No. 2 Q. It basically authorizes you to obtain whatever information 3 you want concerning her employment, concerning her bank 4 account, concerning any of the other information that is 5 specifically set forth in the authorization and release 6 information portion of this document, isn't that so? 7 A. Yes. 8 Q. So the answer to my question is that you did not, as 9 authorized by this document seek to verify any of the 10 employment information or any of the other financial 11 information that you had been provided, isn't that so? 12 A. We verified the information through means that did not 13 require this form. 14 Q. So you did not contact the employer or the bank directly to 15 verify any of the information, isn't that yes or no? 16 A. We probably did -- well, 99 percent did a verbal 17 verification as required on all loans, so we would have 18 contacted the employer for a verbal verification of employment. 19 Q. And would that also include the income? 20 A. Verbal verifications do not necessarily include income. 21 Q. Regardless of whether they necessarily include income, I am 22 asking whether or not do you know whether in this particular 23 instance Nationwide actually contacted Ms. Annabi's employer to 24 verify the employment and the amount of her income, yes or no? 25 Do you know? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2164 C37UANN3 Bicknese - cross 1 A. I do not know the answer to that. My processor would have 2 done that. 3 MR. ARONWALD: With respect to Government Exhibit 458, 4 can we have that up on the screen, please. 5 Q. Is this a document that is prepared by the lender or by 6 Nationwide? 7 A. This is a document prepared by the lender. 8 Q. In this document the wrong box is checked, isn't it? 9 A. Yes. 10 MR. ARONWALD: Could we just have the box that was 11 checked magnified, please. 12 Q. And this box indicates, it says: "We, or at least one of 13 the applicants, now occupies the subject property. I/we 14 understand that the lender is willing to evaluate my loan 15 application only because I/we certify the intention to occupy 16 the property," correct? 17 A. Correct. 18 Q. But at the time that this document is dated, July 27 of 19 '04, Ms. Annabi was not occupying the property at that time, 20 correct? 21 A. This is at the closing, so I would say not until after the 22 closing, correct. 23 Q. In fact you testified in the grand jury that the wrong box 24 was checked? 25 A. Correct. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2165 C37UANN3 Bicknese - cross 1 Q. And that that box would be the box that would be checked if 2 it was a refinance of a mortgage, not an initial mortgage, 3 correct? 4 A. Correct. 5 Q. Now, who is Toni Castaldi? 6 A. Toni Castaldi was a part-time loan officer. 7 Q. Didn't Sandy Annabi use Toni Castaldi for the purchase of 8 13 Patton Drive? 9 A. I don't know. 10 Q. Didn't Sandy apply for the mortgage through Toni Castaldi? 11 A. Toni Castaldi works on a program that we have. 12 MR. ARONWALD: Move to strike as not responsive. I am 13 asking whether or not Sandy Annabi applied for this mortgage 14 through Toni Castaldi. 15 THE COURT: Did she, yes or no? 16 THE WITNESS: Yeah. 17 BY MR. ARONWALD: 18 Q. Wasn't it Ms. Castaldi who opened the mortgage application 19 file on Ms. Annabi? 20 A. No. I opened up the file to be used. 21 Q. Didn't Ms. Castaldi obtain the financial information from 22 Ms. Annabi? 23 A. No. 24 Q. Do you recall being interviewed by Special Agent Michael 25 Mazzuca who is seated at the counsel table and special agent SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2166 C37UANN3 Bicknese - cross 1 Rosemary Karaka of the FBI on February 12, 2007? 2 A. Yes. 3 Q. Didn't you tell Agents Mazzuca and Karaka that Sandy Annabi 4 used Toni Gail Castaldi of Nationwide Equities to purchase the 5 residence at 13 Patton Drive, Yonkers, New York? 6 A. Yes. 7 Q. Didn't you tell the agents during that same interview that 8 at the time Ms. Castaldi was working jointly as a real estate 9 agent with her husband, Lou Castaldi, and also as a broker for 10 Nationwide Equities? 11 A. Yes. 12 Q. Didn't you tell the agents that Sandy Annabi made an offer 13 for the property at 13 Patton Drive which was accepted and that 14 she applied for a mortgage through Ms. Castaldi? 15 A. I don't recall that. 16 Q. Didn't you also tell the agents that Toni Castaldi was the 17 individual who opened the mortgage application file on Sandy 18 and that she, Ms. Castaldi, obtained Sandy's financial 19 information? 20 A. I don't recall. 21 Q. You don't recall or you don't recall whether you told that 22 to the agents? 23 A. I don't recall what I told the agents that day. 24 Q. By the way, would you say that your memory of these events 25 was better on February 12 of 2007 than it is today, five years SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2167 C37UANN3 Bicknese - cross 1 later? 2 A. Perhaps. 3 Q. Let me show you what has been marked 3504-B, page 1. 4 MR. ARONWALD: May I approach, your Honor? 5 THE COURT: You may. 6 Q. Sir, would you please look at this document, just read the 7 first page to yourself and let me know when you have finished. 8 (Pause) 9 Q. Having read the document, does that refresh your 10 recollection that you told the agents that Sandy Annabi used 11 Toni Castaldi of Nationwide Equities to purchase the residence 12 at 13 Patton Drive, Yonkers, New York? 13 A. That's what is written there. 14 Q. I am not asking you that. I am asking you does that 15 refresh your recollection that that's what you told them? 16 A. No. 17 Q. Does it refresh your recollection that you told the agents 18 that Toni Castaldi was working jointly as a real estate agent 19 with her husband, Lou Castaldi, and also as a broker for 20 Nationwide Equities? 21 A. Yes. 22 Q. Does it refresh your recollection that you told the agents 23 that Sandy made an offer for the property which was accepted 24 and that she applied for the mortgage through Ms. Castaldi? 25 A. No. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2168 C37UANN3 Bicknese - cross 1 Q. Does it refresh your recollection that you told the agents 2 that Toni Castaldi was the individual who opened the mortgage 3 application file on Sandy and that Ms. Castaldi obtained 4 Sandy's financial information? 5 A. Yes. 6 Q. It does refresh your recollection that you told the agents 7 that, correct? 8 A. Yeah. 9 Q. Now, with respect to the portions that you have indicated 10 the document does not refresh your recollection, you are not 11 saying that you didn't tell that to the agents, you are saying 12 that you don't have any recollection of whether you said that 13 to the agents, correct? 14 A. I don't recall everything that I said to the agents that 15 day. I didn't write that document. 16 Q. Now, do you recall testifying on direct examination that 17 Sandy's credit was very good? 18 A. Yes. 19 Q. But didn't you tell the agents when you met with them on 20 February 12, 2007, that when Ms. Castaldi forwarded the file to 21 you, you reviewed it and felt that Sandy's credit rating was 22 not very good? Do you recall telling that to the agents on 23 February 12, 2007? 24 A. No. 25 Q. I have shown you the document and you read it, did the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2169 C37UANN3 Bicknese - cross 1 document at all refresh your recollection? 2 A. It refreshes the conversation, yes. 3 Q. I am not interrupting you, but I think you need to let me 4 finish my question and then you can answer it because I want 5 the jury -- 6 A. But there are just too many holes to answer. 7 THE COURT: No. There are no holes. 8 When he stops talking, when he stops talking, take a 9 deep breath and then we will see if he starts talking again. 10 That will give you a little breathing time. Then answer the 11 question. 12 MR. ARONWALD: May I have last question read back? 13 THE COURT: It got interrupted. Mr. Aronwald, could 14 you just re-ask it? 15 MR. ARONWALD: Judge, I honestly don't remember the 16 last question. Judge, at my age, I am lucky if I remember what 17 day of the weak it is. 18 THE COURT: Go ahead and read the question. 19 (Record read) 20 BY MR. ARONWALD: 21 Q. Having reviewed the document that I showed you a few 22 moments ago, does that refresh your recollection that when 23 Ms. Castaldi forwarded the file to you, you felt that Sandy's 24 credit rating was not very good? 25 A. No. I don't recall ever saying that. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2170 C37UANN3 Bicknese - cross 1 Q. Do you recall telling the agents that because her credit 2 rating was not very good, you used a mortgage lender who dealt 3 in subprime mortgages? Didn't you tell that to the agents? 4 A. No. 5 Q. Isn't it true that only after you received the file from 6 Ms. Castaldi was it that you first met with Sandy Annabi 7 concerning 13 Patton Drive? 8 A. Yes. 9 Q. Do you recall telling the agents that when you met with 10 Sandy Annabi, her father was very involved in the details of 11 Sandy's mortgage process? 12 MR. HALPERIN: Objection. Asked and answered. 13 THE COURT: The objection is sustained. 14 MR. ARONWALD: Your Honor, I am going to go into a 15 different subject. Is this a good time for a break? 16 THE COURT: Keep going another five or ten minutes. 17 MR. ARONWALD: OK. 18 BY MR. ARONWALD: 19 Q. Now, do you recall at any time being told by Sandy Annabi 20 that she wants to back out of the deal prior to the closing? 21 MR. HALPERIN: Objection. Hearsay. It is what Ms. -- 22 THE COURT: The objection is sustained. 23 Q. At any time did you tell Sandy Annabi that she could not 24 back out of the deal without forfeiting the down payment that 25 she had paid? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2171 C37UANN3 Bicknese - cross 1 MR. HALPERIN: Objection. Same grounds. 2 THE COURT: No. 3 Did you say those words? 4 Did the witness say those words to Ms. Annabi, not did 5 Ms. Annabi say those words to the witness? 6 MR. HALPERIN: The question incorporates hearsay. 7 THE COURT: Overruled. 8 A. I don't recall anything about that. 9 MR. ARONWALD: Government Exhibit 459, if we could 10 have that up. 11 Your Honor, just for the record, not that I 12 necessarily need it but now this screen is dead. 13 THE COURT: You know what, let's go to lunch. 14 Let's see maybe if the government can find someone who 15 can fix the screens. 16 Don't discuss the case. Keep an open mind. 17 I will see you about 10 after 2. 18 19 (Continued on next page) 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2172 C37UANN3 Bicknese - cross 1 (Jury not present) 2 THE COURT: You are not to talk to the government. 3 That includes the agents. 4 MR. CARBONE: Judge, I just want -- 5 THE COURT: Hang on. Let the witness go. 6 MR. ARONWALD: Would you admonish the witness? 7 THE COURT: I already did. 8 MR. ARONWALD: I didn't hear you. 9 THE COURT: What, Mr. Carbone? 10 MR. CARBONE: Judge, I know you don't like surprises 11 so I just want to raise a potential issue. It may not arise. 12 But this afternoon, if we get to the witnesses, Special Agents 13 Karaka and O'Connor will testify about statements that 14 Ms. Annabi made in the interviews. 15 We raised this issue at the beginning of the trial. 16 Defense, particularly Mr. Aronwald, may seek to offer 17 additional statements under the rule of completeness. Mr. 18 Aronwald and I are going to sit down over lunch and try to 19 resolve whether those statements should come in. We will make 20 every effort to resolve it, but if we can't -- 21 THE COURT: Then they will be presented to me and 22 there will be a ruling. 23 MR. CARBONE: I just wanted to raise the issue. 24 THE COURT: Thank you, Mr. Carbone. I appreciate 25 that. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2173 C37UANN3 Bicknese - cross 1 MR. CARBONE: You are very welcome. 2 MR. ARONWALD: I am supremely confident that we will 3 not have to impose upon you, your Honor. 4 THE COURT: I hope so. 5 (Luncheon recess) 6 7 (Continued on next page) 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2174 C37Qann4 Bicknese - Cross 1 AFTERNOON SESSION 2 2:10 P.M. 3 (In open court; jury not present) 4 THE DEPUTY CLERK: Case on trial continued. 5 Government and defendants present. Jurors are not present. 6 Ready to roll? 7 THE COURT: Yes. 8 (Jury present) 9 KENNETH BICKNESE, resumed. 10 THE COURT: Have a seat, everybody. 11 Sir, you are still under oath. 12 Mr. Aronwald. 13 MR. ARONWALD: No further questions. 14 THE COURT: I'm thrilled to hear it. 15 Mr. Siano. 16 MR. SIANO: No questions, your Honor. 17 THE COURT: Mr. Halperin. 18 REDIRECT EXAMINATION 19 BY MR. HALPERIN: 20 Q. Good afternoon again, Mr. Bicknese. 21 Mr. Turk, can you please display Government Exhibit 22 463? 23 MR. HALPERIN: Judge, can the Court just inquire if 24 the monitor problems are solved? 25 THE COURT: Everybody is looking good. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2175 C37Qann4 Bicknese - Redirect 1 Q. Mr. Turk, I want you to highlight the top half of the page. 2 Mr. Bicknese, on cross, counsel was asking you about the amount 3 of the two loans. What was the amount of the primary loan for 4 the 13 Patton Drive property? 5 A. $430,100. 6 Q. Thank you, Mr. Turk. Let's have Government Exhibit 451. 7 If we can maximize the top quarter of the page. 8 Mr. Bicknese, what was the amount of the second 9 mortgage applied for? 10 A. $50,600. 11 Q. So this loan application is for the first or second 12 mortgage? 13 A. The second mortgage. 14 Q. Thank you, Mr. Turk. 15 Counsel asked about what verifications you conducted 16 on the borrower's information. Do you recall those questions? 17 A. Yes. 18 Q. What type of verifications would you have conducted? What 19 would you have done verbally versus by paper? How would that 20 work? 21 A. We would have -- in the absence of rent checks, we would 22 have conducted a verification of rent utilizing the documents 23 we saw earlier; otherwise, the income documentation we used, 24 you know, pay stubs and W-2s. 25 Q. Now, if a borrower does not disclose that she SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2176 C37Qann4 Bicknese - Redirect 1 simultaneously applied for another mortgage, how would you know 2 if that had happened? 3 A. I wouldn't know. 4 Q. Mr. Turk, can we have Government Exhibit 458, please. 5 Let's highlight the top half of the page. 6 Mr. Bicknese, again, what is 458? 7 A. It's an occupancy affidavit. 8 Q. You were asked about this on cross. Was the wrong box 9 checked here? 10 A. Yes. 11 Q. Why was the wrong box checked? Which box should have been 12 checked? 13 A. The box that would normally be checked would be the first 14 paragraph, the first box. 15 Q. Which states what essentially? You don't have to read it, 16 but just summarize it. 17 A. Basically this says that it's a purchase and you're going 18 to be moving into the house. 19 Q. So, the first box says you are going to be moving into the 20 house and that you intend to occupy it as a primary residence? 21 A. Correct. 22 Q. What does the second box say in summary? 23 A. The second box says that you already live in it, and that 24 the lender is giving you the loan based on that intention. 25 Q. And your intention, the last line says what? "I certify the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2177 C37Qann4 Bicknese - Redirect 1 intention to" what? 2 A. To occupy the property. 3 Q. When would this document have been filled out, sir? 4 A. This is a closing document from Fremont. 5 Q. Thank you, Mr. Turk. 6 Now, Mr. Bicknese, who ran the office at Nationwide 7 Equities where you worked in 2004? 8 A. I did. 9 Q. Who did this person Toni Castaldi work with at Nationwide 10 Equities? 11 A. Myself. 12 Q. Who did she work with on this loan application? 13 A. Myself. 14 Q. What, if any, other role did Ms. Castaldi have in terms of 15 this application? 16 A. She would have just provided the initial information for 17 preapproval. 18 Q. As you talked about on direct, did you yourself have 19 meetings with Ms. Annabi during the mortgage application 20 process? 21 A. I did. 22 Q. And where were those meetings, sir? 23 A. In my office at 5 Seminary Avenue. 24 MR. HALPERIN: Thank you, Judge. 25 THE COURT: That means no further questions? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2178 C37Qann4 Bicknese - Redirect 1 MR. HALPERIN: Yes, your Honor. Sorry. 2 MR. ARONWALD: No questions. 3 MR. SIANO: No questions. 4 THE COURT: Thank you. You are done, sir. Thank you. 5 (Witness excused) 6 THE COURT: Call your next witness, please. 7 MR. CARBONE: The government calls Shelley Beck. 8 SHELLEY BECK, 9 called as a witness by the Government, 10 having been duly sworn, testified as follows: 11 DIRECT EXAMINATION 12 BY MR. CARBONE: 13 THE DEPUTY CLERK: Tell us your name. 14 THE WITNESS: My name is Shelly Beck. 15 THE COURT: You may inquire. 16 MR. CARBONE: Thank you, your Honor. 17 Q. Good afternoon, Ms. Beck. Where are you employed? 18 A. I'm employed for PNC. 19 Q. What is your title? 20 A. I am vice-president and underwriter for the collateral 21 management group. 22 Q. How long have you been employed by PNC Bank? 23 A. A little over eleven years. 24 Q. Where is PNC Bank located? 25 A. The office that I work at is in Miamisburg, Ohio. Their SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2179 C37Qann4 Beck - Direct 1 corporate headquarters is in Pittsburgh. 2 Q. What are your duties and responsibilities at PNC Bank? 3 A. At this point, I am a work-out underwriter. In other 4 words, we look at loans that are on the books that have gone 5 into foreclosure or are in default, and we try to work out 6 programs to keep those borrowers in their homes. 7 Q. Are you familiar with National City Bank? 8 A. Yes, I am. 9 Q. How are you familiar with National City Bank? 10 A. I was originally employed for National City Bank which was 11 then purchased, merged with PNC. 12 Q. What position did you hold at National City Bank? 13 A. I started out as a contract underwriter for another company 14 working on site there, and then National City hired me to be 15 their wholesale underwriting manager. 16 Q. Where was National City Bank headquartered? 17 A. Their headquarters were in Cleveland, Ohio. 18 Q. What is the relationship between National City Bank and PNC 19 Bank? 20 A. National City Bank was purchased by PNC. 21 Q. When did that acquisition occur? 22 A. I don't know the exact date, but it would have been 23 approximately 2008. 24 Q. Was National City Bank engaged in the business of making 25 residential home loans? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2180 C37Qann4 Beck - Direct 1 A. Yes. 2 Q. Did the bank also acquire loans originated through brokers? 3 A. Yes. 4 Q. Are you familiar with the term or phrase correspondent 5 lending? 6 A. Yes, I am. 7 Q. Can you explain what correspondent lending is. 8 A. Yes. That was -- correspondent lending was within my 9 division that I underwrote and also managed underwriters. A 10 correspondent lender would be a company that would originate a 11 loan, close the -- underwrite the loan and close the loan with 12 their own funds and then deliver that package or that note to 13 National City, and then we would purchase that. 14 Q. Who actually makes the loan decision for the correspondent 15 lender? 16 A. The originating lender, the correspondent lender. 17 Q. Are you familiar with an entity known as Columbia Equities? 18 A. Yes, I am. 19 Q. What was the relationship between Columbia Equities and 20 National City Bank? 21 A. They were one of our correspondent lenders that we did -- 22 they were one of our customers in our correspondent lending 23 division. 24 Q. Are you familiar with the business records of National City 25 Bank? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2181 C37Qann4 Beck - Direct 1 A. Yes, I am. 2 Q. Do the business records of PNC Bank also include the loan 3 files of National City Bank? 4 A. Yes, it does. 5 Q. Did National City Bank make loans to Sandy Annabi or home 6 loans to Sandy Annabi? 7 A. National City purchased a loan where Sandy Annabi was the 8 borrower, correct. 9 Q. Directing your attention to Government Exhibit 479 for 10 identification. 11 A. Yes. 12 Q. Have you reviewed the exhibits on Government Exhibit 479 13 for identification? 14 A. Yes, I have. 15 Q. For the record, 479 contains a list of proposed Government 16 Exhibits relating to certain loan files maintained by National 17 City Bank. 18 Have you reviewed the records reflected on that list? 19 A. Yes, I have. 20 Q. And you've compared those documents to the loan files 21 maintained by National City Bank relating to Sandy Annabi? 22 A. Yes, I have compared and verified. 23 Q. What categories of records are described on the list? 24 A. These would be the documents that verified income, assets, 25 and also the actual application and closing documents. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2182 C37Qann4 Beck - Direct 1 Q. What is the bank's policy on maintaining original 2 documents? 3 A. The only actual original piece of paper that we keep in 4 original form is the note. We keep that because it's the 5 collateral and it's held in a vault. All other documents that 6 are in a loan file are imaged within our imaging system. They 7 are considered the true, exact and correct copies of those, and 8 that's done for purposes of storage. Hundreds of thousands of 9 loans, we wouldn't have enough square footage to keep all of 10 those files, so they're kept on an image system. 11 Q. Are the records identified on Government Exhibit 479 kept 12 in the regular course of business? 13 A. Yes, they are. 14 Q. And it's the regular practice of the bank to make and keep 15 such records? 16 A. Correct. 17 Q. Are documents created by or based on information received 18 from someone with knowledge of the transactions? 19 A. Yes. 20 MR. CARBONE: Your Honor, the government offers all 21 the exhibits identified on Government Exhibit 479 for 22 identification in evidence. 23 MR. ARONWALD: Your Honor, assuming that the Court's 24 ruling would be the same as it was the other day when the issue 25 came up, then with that in mind, my position would be the same, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2183 C37Qann4 Beck - Direct 1 I'm sure your ruling would be the same, so -- 2 THE COURT: You're right. 3 MR. ARONWALD: Thank you. 4 THE COURT: They're admitted over Mr. Aronwald's 5 objection. 6 MR. CARBONE: Thank you. 7 (Government's Exhibits 479 and all identified exhibits 8 received in evidence) 9 Q. Now, directing your attention to July 2004, were the 10 deposits of National City Bank FDIC insured during this time 11 period? 12 A. Yes they were. 13 Q. And the bank received mortgage loan applications from Sandy 14 Annabi? 15 A. Yes, we did. 16 Q. Was it the bank's practice to require buyers to attend a 17 closing? 18 A. Yes. 19 Q. Have you seen any powers of attorney in the file? 20 A. No, I have not. 21 Q. What was the address of the property related to this loan? 22 A. It was on Bacon Street. I think it was 40 Bacon Street in 23 Yonkers. I'm not sure if that's the exact correct address. 24 Q. Can you please broadcast, Mr. Turk, 486-J? 25 A. I'm sorry, what was the number? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2184 C37Qann4 Beck - Direct 1 Q. It's 486-J. It should be up on your monitor as well. 2 A. OK. Oh, 45 Bacon. 3 Q. What is 486-J? 4 A. That is the first page of a residential loan application. 5 Q. What kinds of information is the borrower required to 6 disclose? 7 A. It would be disclosure of the property that is being 8 mortgaged, the borrower's name, personal information as far as 9 date of birth, social security numbers, address and places of 10 employment. 11 Q. Mr. Turk, would you please maximize the lines that say 12 purpose of the loan. 13 Ms. Beck, was this a primary residence, secondary 14 residence or investment loan? 15 A. This loan was for primary residence. 16 Q. Referring a couple of lines above, if you could just 17 maximize the address. 18 What is the actual address of the property? 19 A. The actual address is 45 Bacon Place, Yonkers, New York. 20 Q. Please turn to page 2, Mr. Turk. Maximize the top. 21 There is a total amount of monthly income that the 22 borrower reflects here? 23 A. It shows base employment and other income for a total of 24 $12,841.55 per month. 25 Q. How much rent does the borrower indicate that she's paying? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2185 C37Qann4 Beck - Direct 1 A. $950 a month. 2 Q. Please turn to page 3. Maximize the declaration section 3 and highlight paragraph H. 4 Can you tell us how Ms. Annabi responded when asked if 5 any part of the down payment was borrowed? 6 A. The answer was no. 7 Q. Please maximize question L. 8 Can you tell us how Ms. Annabi responded to the 9 question: "Do you intend to occupy the property as your 10 primary residence"? 11 A. And the answer was yes. 12 Q. Please restore the document, Mr. Turk, and maximize the 13 signature section. 14 Ms. Beck, could you please tell us the date that this 15 document appears to have been signed? 16 A. June 2, 2004. 17 Q. Now, Mr. Turk, would you please broadcast Government 18 Exhibit 486-I in evidence. Again, this is the typewritten 19 version. Mr. Turk, could you please highlight the initials on 20 the bottom of the page? 21 Ms. Beck, could you please tell us whose initials 22 appear on the bottom of the page? 23 A. SA, which is the borrower, Sandy Annabi. 24 Q. Mr. Turk, turn to page 2, please. Maximize the top third 25 of the document. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2186 C37Qann4 Beck - Direct 1 Please tell us, if you would, how much Ms. Annabi 2 indicates her total monthly income is? 3 A. $12,841.25 per month. 4 Q. If we could then turn to page 3. 5 Is the typewritten version of the uniform residential 6 loan application typically signed at the closing? 7 A. Yes, it is. 8 Q. Can you again, Mr. Turk, just maximize the declaration 9 section. 10 If you would, please tell us how Ms. Annabi responded 11 to the question that asked whether any part of the down payment 12 was borrowed? 13 A. The statement was no. 14 Q. How did she respond to the question whether she intended to 15 occupy the premises as a primary residence? 16 A. The answer was yes. 17 Q. Please maximize the signature line, Mr. Turk. 18 What was the date reflected on that signature line? 19 A. July 30, 2004. 20 Q. Mr. Turk, would you please broadcast Government Exhibit 21 486-F. 22 What is Government Exhibit 486-F? 23 A. That is a 2002 W-2 for Sandy Annabi for the employment at 24 St. Joseph's Hospital. 25 Q. What is the total amount of income reflected for that year? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2187 C37Qann4 Beck - Direct 1 A. $92,106.74. 2 Q. Mr. Turk, please broadcast 486-G. 3 Can you tell us what is reflected in 486-G? 4 A. Yes. That's the 2003 W-2 again for Sandy Annabi for her 5 employment at St. Joseph's Hospital. 6 Q. How much income is reflected on line 1? 7 A. $98,739.86. 8 Q. Mr. Turk, please broadcast Government Exhibit 486-D. 9 Maximize the two lines dated 4/9 and 4/23. 10 Can you tell us how much the deposits were on those 11 dates as reflected on this statement? 12 A. Yes, they were each for $3,191.98. 13 Q. Whose bank statement is this? 14 A. This was Sandy Annabi's. 15 Q. If you turn the page, Mr. Turk broadcast 486-E. 16 What is 486-E? 17 A. That is a copy of the pay stub for Sandy Annabi from St. 18 Joseph's Medical Center. 19 Q. How much does it indicate the pay stub is for? 20 A. The net amount was $3,191.98. 21 Q. How much is reflected in the gross year-to-date earnings as 22 of June 12? 23 A. That would have been $56,200.04. 24 MR. HALPERIN: Thank you. No further questions, your 25 Honor. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2188 C37Qann4 Beck - Direct 1 THE COURT: Mr. Aronwald. 2 MR. ARONWALD: Yes, your Honor. 3 CROSS-EXAMINATION 4 BY MR. ARONWALD: 5 Q. Good afternoon, Ms. Beck. 6 A. Good afternoon. 7 Q. As I understand your testimony, National City was purchased 8 by PNC, correct? 9 A. That is correct. 10 Q. And that happened when? 11 A. I don't remember the exact date. It was in 2008. 12 Q. You were working for PNC in 2008, correct? 13 A. Yes. 14 Q. So you had absolutely nothing at all to do with the loan 15 transaction that is reflected in the documents which were just 16 placed before you, correct? 17 A. Correct. 18 Q. Now, National City Bank is in the business of lending 19 money? 20 A. Yes. 21 Q. In connection with mortgage loans? 22 A. Correct. 23 Q. That would be for both residential and commercial? 24 A. Yes. 25 Q. That would be for both residential and investment SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2189 C37Qann4 Beck - Cross 1 properties? 2 A. Yes. 3 Q. Does PNC in the course of doing its business of lending 4 money for mortgages, does it employ loan officers? 5 A. Yes, it does. 6 Q. What is the role of a loan officer with respect to a 7 mortgage loan transaction? 8 A. The mortgage loan officer meets with the prospective 9 borrower, obtains their personal information for the loan 10 application and supporting documents for that information. 11 Q. Now, there are no-doc loans and doc loans, correct? 12 A. Correct. 13 Q. And a no-doc loan would be a loan where no supporting 14 financial documentation is required, correct? 15 A. Correct. 16 Q. A doc loan is where supporting financial documentation is 17 required, correct? 18 A. Correct. 19 Q. Are there categories of doc loans like full doc loans and 20 non-full doc loans? 21 A. Yes. 22 Q. Could you just explain what the difference is. 23 A. Well, a full documentation loan would be, for instance, 24 unemployment and income. There would be a direct verification 25 of income completed by the employer and returned back to the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2190 C37Qann4 Beck - Cross 1 lender. And then there's an alternate documentation in the 2 same line. Rather than going directly to the employer for the 3 numbers, the lender would go to the employer to verify that 4 they're an employee, what their dates were, but then they would 5 get the financial numbers from the borrower by way of pay 6 stubs, W-2s, tax returns, that sort of thing. 7 Q. Is there any way for you to tell from the documents that 8 were placed before you whether the loan transaction about which 9 you have been questioned was a full doc loan or a non-full doc 10 loan? 11 A. Yes, I can. 12 Q. And which would it be? 13 A. It would be an alternate doc loan. 14 Q. OK. So you also testified -- strike that. 15 Now, the loan officer, does he or she get paid 16 regardless of whether the loan is placed? 17 MR. CARBONE: Objection. Relevance. 18 THE COURT: Objection sustained. 19 Q. Do you know whether or not the -- the initial loan 20 application, that is filled out by the loan officer, is that 21 correct? 22 A. That is correct. 23 Q. Now, in this case do you have any idea who the loan officer 24 was from looking at the documents that were placed before you? 25 A. Yes, I know the name. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2191 C37Qann4 Beck - Cross 1 Q. And could you please tell us the name of the loan officer 2 from the documents that have been placed before you? 3 A. Sam Hattar, H-A-T-T-A-R. 4 Q. You've never spoken to Mr. Hattar, have you? 5 A. No, I have not. 6 Q. Other than speaking to him, have you ever had any contact 7 with him in writing? 8 A. No. 9 Q. Now, you testified that the only original document that is 10 retained by PNC is the note, correct? 11 A. Correct. 12 Q. All other documents were imaged? 13 A. Correct. 14 Q. By imaged, do you mean they're scanned? 15 A. Yes, I do. 16 Q. You testified that the reason for that is for storage 17 space. In other words, to cut down on the amount of storage 18 space you need for the mountain of documents that would be 19 generated in the normal process of processing mortgage loans, 20 correct? 21 A. Correct. 22 Q. OK. When a document is imaged or scanned, when the 23 original document is imaged or scanned, is that done by the 24 loan officer or by the bank that places the loan? 25 A. It was done by our bank. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2192 C37Qann4 Beck - Cross 1 Q. When you say your bank, since PNC was not the original 2 lender, the original documents when the loan was processed 3 would have been done by Columbia Equities? 4 A. No, the original imaging would have been done by National 5 City Mortgage. 6 Q. That's the company that you acquired, PNC? 7 A. Correct. 8 Q. So, in other words, PNC had nothing at all to do with the 9 imaging? 10 A. Correct. 11 Q. So PNC never saw the actual original loan documents, 12 correct? 13 A. Correct. 14 Q. And PNC also never saw the original supporting 15 documentation that was part of that original loan application 16 file, correct? 17 A. Correct. 18 Q. Now, that would include W-2s, it would include all the bank 19 statements, all of those other documents, isn't that so? 20 A. Yes. 21 Q. So it would be fair to say that you never saw the actual 22 original loan file? 23 MR. CARBONE: Objection. Asked and answered. 24 THE COURT: Objection sustained. 25 Q. The fact is you don't know whether or not the documents SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2193 C37Qann4 Beck - Cross 1 that are within the business records of PNC -- strike that. 2 Whatever records are in the business records of PNC 3 were records that were acquired when PNC bought National City, 4 correct? 5 A. Can you repeat the question? 6 Q. Well, PNC purchased National City Bank in 2008 or 7 thereabouts, correct? 8 A. Correct. 9 Q. When you purchased National City, whatever assets, 10 property, business records and the like that belonged to 11 National City were then acquired and made part of PNC's 12 records, correct? 13 A. Correct. 14 Q. So you have no way of knowing whether or not the documents 15 which are constituting the business records of PNC as they 16 relate to this 45 Bacon Place loan transaction, whether those 17 imaged documents are true copies of the original loan files; 18 you don't know that? 19 A. I do know that. 20 Q. How do you know that? 21 A. Because National City received and had those documents, 22 those original documents, and they in turn imaged them, and I 23 was employed at National City. 24 Q. But from who did National City receive those original loan 25 documents? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2194 C37Qann4 Beck - Cross 1 MR. CARBONE: Objection. Asked and answered. 2 THE COURT: The objection is sustained. 3 MR. ARONWALD: This is a different question, Judge. 4 THE COURT: Answer the question. Where did National 5 City get the loan documents from? 6 THE WITNESS: They got them from Columbia Equities 7 LTD. 8 Q. And Columbia Equities LTD got the loan documents from Sam 9 Hattar, didn't they? 10 A. No, that's not the way mortgage companies work. 11 Q. How do the companies work? 12 A. Well, they receive those documents from the borrower, the 13 W-2s and pay stubs. 14 Q. That's right, but -- 15 A. Sam is a representative, I'm sorry. 16 Q. But those documents are given to the loan officer, correct? 17 A. Yes. 18 Q. Then the loan officer, in this case, Sam Hattar, basically 19 submits the entire package to the lending bank. In this case 20 it would be Columbia, correct? 21 A. Yes. 22 Q. OK. 23 A. Yes. 24 Q. So what I'm saying is that in the first instance the 25 information goes to the loan officer, the loan officer then SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2195 C37Qann4 Beck - Cross 1 submits all the documents to the lender to whom the loan is 2 being applied for, correct? 3 A. Yes, but on this application Sam was an employee of 4 Columbia. 5 Q. OK. 6 A. So he presented them to his underwriter. 7 Q. That's right. 8 A. So I'm speaking in my vernacular trying to relate it to 9 yours. 10 Q. That's fine. But what I'm asking you is, you don't know 11 whether or not Sam Hattar altered any of the information that 12 he received from Ms. Annabi, you don't know that? 13 MR. CARBONE: Objection. 14 THE COURT: The objection is sustained. 15 MR. ARONWALD: Your Honor, could we -- 16 THE COURT: No, we cannot have a sidebar. I've 17 sustained the objection. Move on. You can make an argument 18 later at the end of the case. 19 BY MR. ARONWALD: 20 Q. You have no personal knowledge whether Sandy Annabi 21 actually provided the information to Sam Hattar that is 22 reflected in the documents about which you testified today, 23 isn't that so? 24 MR. CARBONE: Same objection. 25 THE COURT: That objection is overruled. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2196 C37Qann4 Beck - Cross 1 Q. Isn't that so? 2 A. I was not there, that is correct. 3 MR. ARONWALD: No further questions. Thank you. 4 THE COURT: Mr. Siano. 5 MR. SIANO: No questions, your Honor. 6 MR. CARBONE: No redirect. Thank you. 7 THE COURT: Thank you, ma'am. 8 (Witness excused) 9 THE COURT: Call your next witness, please. 10 MR. CARBONE: The government calls Colleen 11 Taylor-Crusie. 12 COLLEEN TAYLOR-CRUSIE, 13 called as a witness by the Government, 14 having been duly sworn, testified as follows: 15 DIRECT EXAMINATION 16 BY MR. CARBONE: 17 THE DEPUTY CLERK: Tell us your name. 18 THE WITNESS: Colleen Taylor-Crusie. 19 THE DEPUTY CLERK: Spell that. 20 THE WITNESS: C-O-L-L-E-E-N; T-A-Y-L-O-R; C-R-U-S-I-E. 21 THE COURT: You may inquire. 22 MR. CARBONE: Thank you. 23 Q. Good afternoon. 24 A. Good afternoon. 25 Q. Where do you work? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2197 C37Qann4 Taylor-Crusie - Direct 1 A. Currently? 2 Q. Yes. 3 A. Jacqueline Martin's office. 4 Q. Who is Jacqueline Martin? 5 A. An attorney. 6 Q. What do you do there? 7 A. I'm a paralegal; I do real estate closings. 8 Q. How long have you been a paralegal? 9 A. Probably for about 20 years. 10 Q. What do you do as a paralegal in real estate closings? 11 A. I handle mortgage closings, refinance, purchase. 12 Q. Directing your attention to July of 2004, where were you 13 employed at that time? 14 A. Columbia Equities. 15 Q. What was Columbia Equities? 16 A. A mortgage company. 17 Q. What did you do there? 18 A. Real estate closings. 19 Q. What were your job duties? What was your title? 20 A. Closer. I handled the closings for refinancing and 21 purchases. 22 Q. Were you a notary public at that time? 23 A. Yes. 24 Q. What were your duties as a notary public? 25 A. To witness the execution of important documents such as SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2198 C37Qann4 Taylor-Crusie - Direct 1 mortgage papers. 2 Q. While you were employed at Columbia Equities, were you 3 asked on occasion to notarize signatures of documents signed by 4 the borrowers? 5 A. Yes, that was part of the job. 6 Q. Did you have a custom and practice that you followed when 7 you notarized a signature? 8 A. We would get ID. 9 Q. ID from whom? 10 A. The borrower that was executing the mortgage documents. 11 Q. Mr. Turk, would you please broadcast Government Exhibit 488 12 in evidence? 13 What kind of document is this? 14 A. That is just saying that the borrower is going to occupy 15 the residence as their primary residence. 16 Q. Can you please turn to page 2, Mr. Turk. Can you highlight 17 and maximize the bottom half of the page? 18 Do you recognize that signature? 19 A. It's mine. 20 Q. Is that your notary stamp as well? 21 A. Yes. 22 Q. What is the date that you notarized the signature? 23 A. July 30 of '04. 24 Q. Mr. Turk, could you maximize the top half of the document. 25 And whose signature did you notarize? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2199 C37Qann4 Taylor-Crusie - Direct 1 A. Sandy Annabi. 2 Q. Mr. Turk, would you please broadcast Government Exhibit 3 490. 4 What is Government Exhibit 490? 5 A. They're verifying that they're purchasing the property for 6 a certain loan amount. 7 Q. Mr. Turk, would you please maximize the bottom third of the 8 document where it says representation number 7. 9 Can you read the initials that appear under the box? 10 A. SA. 11 Q. Now, Mr. Turk, would you please turn the page to page 2. 12 Maximize the top half of the page. 13 Do you recognize that signature under the notary 14 stamp? 15 A. Yes. 16 Q. Whose signature is that? 17 A. That's my signature. 18 Q. What date did you notarize the signatures above? 19 A. July 30, '04. 20 Q. And the top left, whose signature appears there? 21 A. Sandy Annabi. 22 MR. CARBONE: Thank you. No further questions. 23 MR. ARONWALD: No questions. 24 MR. SIANO: No questions. 25 THE COURT: You may step down, ma'am. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2200 C37Qann4 Taylor-Crusie - Direct 1 (Witness excused) 2 THE COURT: Call your next witness. 3 MR. CARBONE: The government calls Paul Crowley. 4 PAUL CROWLEY, 5 called as a witness by the Government, 6 having been duly sworn, testified as follows: 7 DIRECT EXAMINATION 8 BY MR. CARBONE: 9 THE DEPUTY CLERK: Tell us your full name. 10 THE WITNESS: Paul Crowley, C-R-O-W-L-E-Y. 11 THE COURT: You may inquire. 12 MR. CARBONE: Thank you. 13 Q. Good afternoon, Mr. Crowley. 14 A. Good afternoon. 15 Q. Could you tell us how you're employed? 16 A. I work for the Internal Revenue Service out of Andover, 17 Massachusetts. 18 Q. What do you do there? 19 A. I am a court witness coordinator. 20 Q. What are your duties as a court witness coordinator? 21 A. I secure records and returns maintained by the Internal 22 Revenue Service, make certified copies for court and other 23 judicial proceedings, and testify as to -- as custodian of 24 record representing the commission of the Internal Revenue 25 Service. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2201 C37Qann4 Crowley - Direct 1 Q. How long have you been doing that? 2 A. Since 2005. 3 Q. How long have you been with the IRS altogether? 4 A. I started in 1996. 5 Q. Can you give us a brief summary of what you did in the 6 years before you had your current job? 7 A. I started off as a data entry clerk transcribing 8 information off of the returns on to the Internal Revenue 9 Service computer systems. Then in 1998 I went to criminal 10 investigation and worked as an investigative aide and analyst. 11 There I would verify returns for accuracy and potentially 12 fraudulent trends and create packages to send out to the agents 13 to further develop. 14 Q. Has all this experience given you familiarity with the 15 recordkeeping of the IRS? 16 A. Yes. 17 Q. Can you tell us how a tax return is processed when it's 18 filed? 19 A. When paper return is received at the Internal Revenue 20 Service, they come in in truckloads. They are put on a machine 21 that cuts the envelopes open and separates the checks from the 22 rest of the documents. The checks have to be processed within 23 the first day and a half or so. 24 After the checks are pulled out, all the documents are 25 sorted by form type. 1040 would be in one area. 1040 EZ might SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2202 C37Qann4 Crowley - Direct 1 be in another area. 2 After they're sorted, they are then sent out to the 3 code and edit department. Here the returns are coded and 4 edited for accurate and efficient entry by the date entry folks 5 on to the IRS computer system. 6 After code and edit is completed with the returns, 7 they are then sent to batching and numbering. Here each return 8 is given a unique document locator number that's printed on the 9 top right-hand corner of the page. This is a number that 10 facilitates retrieving the return if we need it in the future. 11 And it's unique once every ten years. 12 After the document locator number is stamped on the 13 return, the return is sent out to the data entry folks where 14 they transcribe specific line items off of the return into the 15 computer system. 16 Once that's completed and there are checks to make 17 sure everything is accurate, the paper document is retained for 18 the end of that particular year and six additional years at 19 some type of file location. And the information that's been 20 transcribed electronically is available within two weeks to 21 anybody within the Internal Revenue Service who has need to 22 access the information. 23 Q. Somewhere along the way there I think you mentioned 1040. 24 Can you tell us what a 1040 individual tax return is? 25 A. A form 1040 is a U.S. individual tax return. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2203 C37Qann4 Crowley - Direct 1 Q. And you also I think mentioned the phrase document locator 2 number? 3 A. That's correct. 4 Q. Are document locator numbers put on other documents as 5 well? 6 A. There are some that are put on adjustments and collection 7 files as well. 8 Q. If you want to find a particular taxpayer's tax return for 9 a particular year, how would you go about it? 10 A. I would perform a search based on the taxpayer's social 11 security number and then look for the specific year that was 12 being requested, and then I would look for the document locator 13 number for that particular return and then request to have that 14 document sent to me. 15 Q. I think you mentioned the computer system contains certain 16 information from filed returns? 17 A. That's correct. 18 Q. What kinds of information generally can you learn just by 19 looking at the computer? 20 A. Well, the taxpayer's name, their residence or their 21 address, their social security number, most of what they file 22 with their return, if they had any payments. 23 Q. What does the term transcript refer to? 24 A. A transcript is an electronic version of the computer file 25 that's on the computer. It would print out a transcript also SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2204 C37Qann4 Crowley - Direct 1 known as a form 40-340. 2 Q. What is a certificate of lack of record? 3 A. That is a record indicating that a search was performed, 4 and that based on the search criteria indicated on the 5 particular form, that there was no record found for that 6 search. 7 Q. Did you review the IRS record with respect to Sandy 8 Annabi's personal tax returns for the years 2000 through 2008? 9 A. Yes. 10 Q. Did you also review IRS records with respect to Zehy and 11 Sada Jereis for those same years? 12 A. Yes. 13 Q. Did you search under name and social security number or 14 both? 15 A. Both. 16 Q. Does the system that you searched, does that have a 17 particular name? 18 A. It's the integrated data retrieval system. We call it 19 IDRS. 20 Q. What is the integrated data retrieval system? 21 A. It is an interface of many databases within the Internal 22 Revenue Service that allows us to retrieve the information 23 based on filings with the Internal Revenue Service. 24 Q. Mr. Crowley, could you look at the binder in front of you? 25 Are the tax returns relating to Sandy Annabi as filed for the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2205 C37Qann4 Crowley - Direct 1 years 2002 through 2008 included in that binder along with the 2 transcripts? 3 A. Yes. 4 Q. If you could take a look at Government Exhibits 1002 5 through 1008, are the tax returns and transcripts for the 6 returns filed by Zehy and Sada Jereis for the years 2002 7 through 2008 also included in your binder? 8 A. Yes. 9 MR. CARBONE: Your Honor, the government offers 10 Government Exhibits 605 through 618 excluding 609-A and 611 and 11 1002 through 1008 excluding 1002-A. 12 THE COURT: If you could keep track of that, any 13 objection? 14 MR. ARONWALD: May I just have a moment, your Honor? 15 (Pause) 16 MR. ARONWALD: Objection on relevance grounds to some 17 of the offered exhibits, your Honor. 18 THE COURT: Well, which ones? And I'm sure I have 19 copies. Do them one by one. 20 MR. ARONWALD: 605. 21 THE COURT: Hang on. 605. Excuse me. Objection is 22 overruled. Next. 23 MR. ARONWALD: 606. 24 THE COURT: Objection is overruled. 25 MR. ARONWALD: 607. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2206 C37Qann4 Crowley - Direct 1 THE COURT: Objection is overruled. 2 MR. ARONWALD: 608. 3 THE COURT: Objection is overruled. 4 MR. ARONWALD: These are on relevance grounds, your 5 Honor. 6 THE COURT: I understand. Relevance. That's what you 7 said. 8 MR. ARONWALD: 609. 9 THE COURT: Objection is overruled. 10 MR. ARONWALD: 610. 11 THE COURT: Objection is overruled. 12 MR. ARONWALD: I'm sorry, 609. 13 THE COURT: Yes, 609 objection overruled. 14 MR. ARONWALD: I think 609 is not offered. 15 MR. CARBONE: 609-A is not offered. 16 MR. ARONWALD: 609-A is not offered. 17 THE COURT: But 609 is. 18 MR. ARONWALD: 610. 19 THE COURT: Objection overruled. 20 MR. ARONWALD: No objection to 611. 21 THE COURT: OK. Thank you. 22 MR. SIANO: No objection, your Honor. 23 THE COURT: I thought as much, Mr. Siano. All the 24 objections have been overruled the documents that were offered 25 by the government are admitted. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2207 C37Qann4 Crowley - Direct 1 (Government's Exhibits 605 through 618 excluding 609-A 2 and 611 received in evidence) 3 (Government's Exhibits 1002 through 1008 excluding 4 1002-A received in evidence) 5 BY MR. CARBONE: 6 Q. Mr. Turk, please broadcast Government Exhibit 605 page 1. 7 Mr. Crowley, what is reflected on that seal? 8 A. This is an indication that it is a certified copy of a 9 record from the Internal Revenue Service, in this case a copy 10 of a Form 1040 U.S. individual income tax return. 11 Q. All of the returns we are about to look at have a similar 12 seal on the cover page? 13 A. Yes, they do. 14 Q. Please turn to page 1. Can you broadcast that, Mr. Turk, 15 and please maximize line 7. 16 Mr. Crowley, how much income does Ms. Annabi report 17 for the year 2002? 18 A. On line 7, $80,776. 19 Q. Is that W-2 income? 20 A. That's correct. W-2 indicates wages, salaries, tips, etc. 21 Q. Is there typically any other form of income reported on 22 line 7? 23 A. No. 24 Q. Please highlight and maximize line 21. 25 Does Ms. Annabi indicate or report any additional SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2208 C37Qann4 Crowley - Direct 1 income during that year? 2 A. No, there was a zero figure. 3 Q. Can you tell when this return was filed? 4 A. This return is considered timely filed by the Internal 5 Revenue Service. 6 Q. Turn to page 2 of the return, the next page. Maximize the 7 signature section. 8 What is a jurat? 9 A. The jurat is the information here that says: Under 10 penalties of perjury, I declare I've examined this return and 11 accompanying schedules and statements and to the best of my 12 knowledge and belief they are true, correct and complete. 13 Q. Do all the returns that were reviewed today have the same 14 jurat? 15 A. Yes, they do. 16 Q. Please turn to Government Exhibit 607, page 2. 17 What is the W-2 income reported on line 7? 18 A. There is a Figure of $88,168. 19 Q. Again, could you maximize line 21, other income. 20 Any other income reported here? 21 A. No. 22 Q. Please turn to Government Exhibit 608, page 2, please. 23 Page 3. 24 What year does 608 relate to? 25 A. This relates to tax year ending December 2003. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2209 C37Qann4 Crowley - Direct 1 Q. Mr. Turk, broadcast 609, page 2. 2 How much total income, maximizing line 7, does 3 Ms. Annabi report in 2004? 4 A. $101,574. 5 Q. Mr. Turk, would you broadcast the fourth page of the 6 exhibit. Maximize the W-2 form. 7 Mr. Crowley, could you please read box 1? 8 A. Box 1 is $60,774.96. 9 Q. What entity issued that W-2 form? 10 A. St. Joseph's Hospital. 11 Q. Referring back to page 2 of the exhibit, Mr. Turk, line 21. 12 Any other income reported that year? 13 A. No. There is a figure of zero. 14 Q. Now please turn to 611. Can you tell us how Government 15 Exhibit 611 was filed? 16 A. It was a paper filed return. 17 (Continued on next page) 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2210 C37UANN5 Crowley - direct 1 MR. CARBONE: Mr. Turk, can you turn to the third page 2 into the exhibit and maximize line 7. 3 Q. What is the total income reported by Ms. Annabi on line 7 4 of this year? 5 A. $102,762. 6 MR. CARBONE: Please maximize line 21. 7 Q. Any other income reported that year? 8 A. There is a figure of 0. 9 MR. CARBONE: Now please broadcast Government Exhibit 10 613. 11 Q. What is Government Exhibit 613? 12 A. 613 is a copy of an electronically filed form 1040 13 individual U.S. tax return for tax year 2006. 14 Q. Can you explain what you mean by electronically filed? 15 A. When a return is electronically filed, a data file is sent 16 to the Internal Revenue Service and when it is received, a 17 document locator number is assigned to the return. And within 18 two weeks from that point, the return is then accepted into the 19 computer system to be reviewed by anybody with the Internal 20 Revenue Service. So when it is received as an electronic 21 return, we don't have anybody opening the envelopes or doing 22 any coding on it. 23 Q. When is Government Exhibit 613, 2006 electronic filed, when 24 was that submitted? 25 A. We would -- well, we could tell by the Julian date of the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2211 C37UANN5 Crowley - direct 1 return which is part of the document locator number. 2 Q. What page is that on? 3 A. That would be the next page. In the top righthand corner 4 of the page there is a number that starts off with 14221. So 5 the next three digits which are 102 is actually the 102nd day 6 of the year in 2007. 7 Q. Turning back to the third page of the exhibit where it says 8 "sign here." There doesn't appear to be any signature there. 9 Can you explain to the jury how a taxpayer certifies an 10 electronically filed return? 11 A. The return is not signed in a handwritten signature like 12 the paper returns, instead the taxpayer inputs a five-digit PIN 13 when they sign the return. 14 Q. How does the taxpayer get that five-digit PIN? 15 A. They get to choose the five digits. 16 MR. CARBONE: Mr. Turk, could you please turn to the 17 last page of this exhibit -- or the second to last page. 18 Q. Did Ms. Annabi actually certify the accuracy of this return 19 for this year? 20 A. Yes. 21 Q. How do you know that? 22 A. Actually, the next page actually has a taxpayer PIN 23 indicated. 24 MR. CARBONE: Please turn to the next page and 25 maximize. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2212 C37UANN5 Crowley - direct 1 A. It indicates the taxpayer PIN as well as the signature date 2 that the taxpayer input that PIN. 3 Q. Is this considered to be the jurat? 4 A. This is signing after reading the jurat. 5 Q. If you turn back to page 8. 6 MR. CARBONE: Maximize the bottom, F. 7 Q. Is that the jurat? 8 A. Yes. This is a jurat for somebody who has prepared -- for 9 the preparer of this particular one. The jurats for the 10 taxpayer is the same one that is back on the second page of the 11 Form 1040. 12 MR. CARBONE: Now, Mr. Turk could you please broadcast 13 Government Exhibit 1004 and broadcast the second page. 14 Maximize the top. 15 Q. Whose tax return is this? 16 A. This is for taxpayer ending last name of Jereis. 17 Q. Is this a joint or individual return? 18 A. This is a joint return. 19 MR. CARBONE: Mr. Turk, could you please maximize the 20 block below where it says "dependents, exemptions." 21 Q. How many exemptions are reflected there? 22 A. A total of four. There is an exemption for yourself, for 23 your spouse and one for each of the children. 24 MR. CARBONE: Could you maximize that page. 25 Q. What was the adjusted gross income reported by Mr. and Mrs. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2213 C37UANN5 Crowley - direct 1 Jereis? 2 A. That would be line 36. The figure there is $77,939. 3 MR. CARBONE: Please broadcast Government 1005. Turn 4 to page 2 and maximize the label section. 5 Q. Whose return is this and for what year? 6 A. This would be for tax year 2005, and it would be for the 7 same taxpayer, the Jereis. 8 Q. And what is the address? 9 A. 19 Woodford Road, Scarsdale, New York. 10 Q. Is this also a joint return? 11 A. Yes, it is. 12 MR. CARBONE: Mr. Turk, could you please maximize the 13 exemption section. 14 Q. How many exemptions did Mr. and Ms. Jereis seek that year? 15 A. That would be four. 16 MR. CARBONE: Please broadcast Government Exhibit 17 1005 -- I'm sorry -- Government Exhibit 1006, page 2, and 18 maximize the label section. 19 Q. Whose return is this? 20 A. This would be for the Jereis, the husband and wife here for 21 2006. 22 MR. CARBONE: Mr. Turk, could you please maximize the 23 exemption section. 24 Q. Mr. Crowley, could you please tell us how many exemptions 25 were claimed by Mr. and Ms. Jereis this year? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2214 C37UANN5 Crowley - direct 1 A. A total of four. 2 MR. CARBONE: Mr. Turk, could you please maximize line 3 37. 4 Q. What is the total adjusted gross income for this year? 5 A. $166,620. 6 Q. Mr. Crowley, are you familiar with the IRS requirements as 7 to when gift tax returns should be filed? 8 A. I have a basic understanding. I am not an expert on filing 9 them. 10 Q. Are there certain dollar thresholds? 11 A. There is a dollar threshold. They are somewhere between 11 12 and, I think, 13,000 dollars of gifts. 13 Q. When a gift tax return gets filed, where does it get filed? 14 A. With the Internal Revenue Service. 15 Q. Is that part of the Form 1040? 16 A. Yes. 17 Q. Does the giver file the return? 18 A. That's correct. 19 Q. Did you conduct a check of the IRS database to determine 20 whether Zehy Jereis filed any gift tax return for the years 21 2002 to 2008? 22 A. Yes. 23 Q. You should have in front of you Government Exhibit 1010 and 24 1011 which have been marked for identification. Do you see 25 those? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2215 C37UANN5 Crowley - direct 1 A. I do have those. 2 Q. Can you tell us what Government Exhibit 1010 is? 3 A. Exhibit 1010 is a certification of lack of record for Form 4 709, United States Gift (and Generation-Skipping Transfer) tax 5 return for taxpayer 2002, 2003, 2004, 2005, 2006, 2007 and 2008 6 for taxpayer's last name Jereis. 7 Q. What is 1011? 8 A. 1011 is a similar form. This one is also for the taxpayer 9 Jereis but I believe Sada -- I am not sure I am pronouncing it 10 properly -- but with a Social ending in 5673, indicating the 11 same information for the same tax years, Form 709, United 12 States Gift (and Generation-Skipping Transfer) tax return 13 indicating that no tax return was filed. 14 MR. CARBONE: Your Honor, the government offers 15 Government Exhibit 1010 in evidence. 16 MR. SIANO: May we approach, your Honor? 17 18 (Continued on next page) 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2216 C37UANN5 Crowley - direct 1 (At the sidebar) 2 MR. SIANO: Judge, these are dated the 22nd of 3 February. There was no suggestion by the government that they 4 were going to implicate my client with regard to failure to 5 file particular returns at any point in time. This is sort 6 of -- 7 THE COURT: I absolutely cannot believe that you are 8 saying this, Mr. Siano. I hear you. Part of what they are 9 trying to prove is that Ms. Annabi received income and, 10 obviously, Mr. Aronwald is going to argue they were gifts. I 11 said yesterday that if they were gifts, that your client had a 12 tax problem and this is not 404(b) evidence. It is direct 13 evidence of crimes charged against Ms. Annabi. 14 The objection is overruled. 15 MR. SIANO: It is proof as to Ms. Annabi it is not 16 directed to proof to my client, that he failed to file tax 17 returns. My client is not charged -- 18 MR. ARONWALD: My client cannot be held responsible 19 because his client didn't file gift tax returns. 20 THE COURT: I understand what you are saying. It is 21 an argument for you to it make. I am giving no instruction. I 22 don't need to give an instruction. 23 The objection is overruled. 24 (Continued on next page) 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2217 C37UANN5 Crowley - direct 1 (In open court) 2 THE COURT: Admitted. 3 (Government Exhibit 1010 received in evidence) 4 MR. CARBONE: Mr. Turk, could you broadcast Exhibit 5 1010. 6 BY MR. CARBONE: 7 Q. Mr. Crowley, could you explain Government Exhibit 1010? 8 A. Sure. This is a certification of lack of record. The 9 description of the record sought indicate the search criteria. 10 In this case, the particular name of Zehy Jereis was searched. 11 And then downward it says, description of information sought. 12 We are searching for a Form 709, United States Gift (and 13 Generation-Skipping Transfer) tax return. And the next box 14 down indicates the period that we looked for and could not 15 locate any Form 709 filed. 16 Q. So Mr. Jereis did not file any gift tax returns for the 17 years 2002, 2003, 2004, 2005, 2006, 2007 or 2008? 18 A. That's correct. 19 MR. CARBONE: Thank you. 20 No further questions. 21 CROSS-EXAMINATION 22 BY MR. ARONWALD: 23 Q. Mr. Crowley, the recipient of the gifts is not required to 24 file a gift tax return, isn't that so? 25 A. That's correct. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2218 C37UANN5 Crowley - cross 1 MR. ARONWALD: No further questions. 2 MR. SIANO: No questions, your Honor. 3 THE COURT: You may step down. 4 (Witness excused) 5 THE COURT: How long is your next witness? 6 MR. HALPERIN: Maybe half an hour. 7 THE COURT: Let's take a little break now. 8 Don't discuss the case. Keep an open mind. 9 (Recess) 10 11 (Continued on next page) 12 13 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2219 C37UANN5 Crowley - cross 1 (Jury not present) 2 THE COURT: Case on trial continued. 3 The parties are present. 4 The jurors are not present. 5 There is absolutely no question that the exhibits -- 6 whatever they were that I don't have in my binder -- that I 7 admitted are direct evidence on a variety of theories. They 8 are direct evidence against Mr. Jereis, at least, on the 9 conspiracy count, on the bribery counts. 10 The fact that there is no tax count against him does 11 not mean that they are not evidence against him. They are in 12 fact direct evidence on the counts that are actually at the 13 heart of this case. Certainly, they are not direct evidence 14 against Ms. Annabi on the tax counts. I am thinking through 15 whether they would qualify as evidence against her, even though 16 she prepared them, on the conspiracy counts. Of course, we 17 have co-conspirator statements. 18 In any event, it would be premature to give an 19 instruction as to Ms. Annabi, but certainly they are evidence 20 on a number of non-tax counts as against Mr. Jereis. 21 Who is the next witness? 22 MR. HALPERIN: Walid Farhat. 23 Judge, I just want you to know that certainly this 24 witness should take us to the end of the day. 25 I just want to let the Court know that before we call SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2220 C37UANN5 Crowley - cross 1 the next two witnesses who are former FBI agents, we need the 2 Court's guidance, but I don't think that will be an issue 3 because I think that this witness will take us to the end of 4 the day. 5 THE COURT: Fine. Take us to the end of the day. 6 7 (Continued on next page) 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2221 C37UANN5 Crowley - cross 1 (Jury present) 2 THE COURT: Call your next witness, please. 3 MR. HALPERIN: Your Honor, the government calls Walid 4 Farhat. 5 WALID FARHAT, 6 called as a witness by the government, 7 having been duly sworn, testified as follows: 8 DIRECT EXAMINATION 9 BY MR. HALPERIN: 10 THE COURT: You may inquire. 11 Q. Good afternoon, Mr. Farhat. 12 What city do you live in? 13 A. Danbury, Connecticut. 14 Q. I am going to ask you to sit a little close to the 15 microphone, please? 16 A. Danbury, Connecticut. 17 Q. How long have you lived there? 18 A. Since 1988. 19 Q. How far have you gone in school? 20 A. Three years' college. 21 Q. What do you do for work? 22 A. Accounting. 23 Q. Do you have your own business? 24 A. Yes. 25 Q. What is the name of it? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 2222 C37UANN5 Farhat - direct 1 A. Evergreen Enterprise. 2 Q. And who is the owner of Evergreen Enterprise? 3 A. Myself. 4 Q. Where is Evergreen located? 5 A. 36 Mill Plain Road, Suite 301, Danbury, Connecticut. 6 Q. What services does Evergreen provide? 7 A. Accounting, bookkeeping and tax preparation. 8 Q. For whom do you do tax preparation -- individuals, 9 corporations, both? 10 A. Both. 11 Q. Are you a certified public accountant? 12 A. No. I am a public accountant. 13 Q. What was your training in tax return preparation? 14 A. Taking tax courses and continuous education. 15 Q. How many employees does Evergreen have? 16 A. Three employee. 17 Q. What year did you establish Evergreen? 18 A. 1986. 19 Q. For roughly how many years have you been preparing clients' 20 taxes? 21 A. Over 25 years. 22 Q. Roughly, how many returns do you prepare in any given year? 23 A. Around 210 to 220. 24 Q. So do you know someone named Zehy Jereis? 25 A. Yes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300