Penn Pike chairman Rubin under fire as "ghost employee" of federal defendant Fumo

Pennsylvania Turnpike Commission chairman Mitchell Rubin is under pressure to resign - set to feature in US Court next month as a crony of the high profile defendant Vincent Fumo. Fumo a longtime state senator is about to go on trial accused by the feds of 139 counts of fraud, conspiracy, obstruction of justice and income tax evasion. The original indictment of last year indirectly identified Turnpike chair Rubin as being kept on the Senate payroll by Fumo to the tune of $30k/year for five years with no legitimate job.

In a memorandum this week the Feds name Rubin directly as a leading "ghost" employee. They say the Turnpike commission chairman, who has gambling interests, "was paid (in state funds) $30,000 per year for five years, in return for no work at all." (p4)

Another longtime Turnpike executive Michael Palermo is named as another ghost employee having been put on a Fumo retainer of $45k/year after he retired from the Turnpike. His ostensible consulting work was "to provide alleged transportation expertise." The US indictment says Palermo's real job was managing Fumo's weekender farm which has views looking over the Susquehanna River north of Harrisburg.

Fumo as the leading sponsor of Turnpike interests in the legislature is himself an embarrassment to the Turnpike Commission.

Neither Michael Palermo nor Mitchell Rubin are the subject of criminal charges themselves. However the Turnpike Chairman's wife, Ruth Arnao is on trial with Fumo as a codefendant and faces 45 felony counts herself.

Arnao was for years a close Fumo associate. She was titled executive-director of a supposed charitable and community organization called Citizens Alliance which the Feds say Fumo and Arnao used to fund the senator's political machine and systematically "skimmed" for their personal enrichment.

The Turnpike chairman's wife will be alongside Fumo in federal court in Philadelphia in a trial starting Sept 8 and predicted to run to at least the end of the year.

The heart of the US case is that: "in using Senate funds and the large staff he was provided (by the state), Fumo observed no distinction whatsoever between public and private tasks. He used an enormous amount of public funds to wage political campaigns, satisfy his personal needs, and reward his friends."

A spokesman for the US Attorney's Office in Philadelphia told us that since they issued their original indictment of Fumo and Arnao they have substantially increased their estimate of the scale of the corruption. They now think the theft amounted to about $3.5m compared to the $2m at the time of the indictment in the spring of 2007.

Two turned

In lasy year's indictment two computer specialists in Fumo's employ were indicted along with Fumo and Arnao. Both the IT guys have reached plea agreements with the Feds in the last few weeks.

They have pled guilty to obstruction of justice charges for deleting and 'wiping' hard drives and agreed to testify against Fumo and Arnao.

Pittsburgh Post Gazette editorial

The Pittsburgh Post Gazette, a leading newspaper in the west of the state says Rubin should explain himself or go from the Turnpike Commission. Some extracts:

"Federal prosecutors lodged a bigger criminal fraud case this week against state Sen. Vincent Fumo -- $1.5 million bigger...

"The new filing is a bigger deal also because it names Mitchell Rubin, chairman of the Pennsylvania Turnpike Commission, as a 'ghost' employee of the senator. The document states he 'was paid $30,000 per year for five years, in return for no work at all.'

"Rubin is a friend of Fumo and the husband of the senator's friend and co-defendant, Ruth Arnao, who is accused of running a Philadelphia nonprofit that spent $600,000 to renovate the senator's district office and $250,000 on political polling.

"...Rubin did not return a call this week from the Associated Press, and a turnpike spokesman told the Post-Gazette that the commission has not issued a statement about the description of him as a Fumo ghost employee because the allegation has nothing to do with the highway.

"We beg to differ.

"The turnpike is an instrument of state government with four commissioners appointed by the governor and confirmed by the Senate (the fifth is the transportation secretary) to oversee the state's 537-mile system and its $593 million in annual tolls collected.

"They are positions of trust that should be filled by people with integrity. The commissioners serve part-time but they receive generous compensation, like Chairman Rubin's $28,500 a year.

"The history of the Pennsylvania Turnpike is already pockmarked with patronage and politics. To have its chairman named as a ghost employee of a senator under indictment only adds to that shabby lore..."

Commonwealth Foundation adamant

The Commonwealth Foundation, the leading public policy thinktank in Harrisburg pulls no punches in a comment Saturday:

"We're still scratching our heads... And Gov. Rendell and the General Assembly allowed the Turnpike Commission to EXPAND it's corruptive power? Hopefully the Federal Highway Administration will see the Turnpike Commission for what it is and deny it the ability to toll Interstate 80. Then we can finally rid ourselves of this patronage cesspool by leasing the Turnpike for $12.8 billion to a private operator who will give us better service and save us from the power, patronage, and politics of the PTC."

Letter Commonwealth Foundation wrote to FHWA earlier:

http://www.commonwealthfoundation.org/docs/Files/FHWAletter.pdf

Here is the Feds' trial memorandum:

http://www.tollroadsnews.com/sites/default/files/TrialMem.pdf

TOLLROADSnews 2008-08-22