Conflicts of Interest Bd. v. Oni OATH Index No. 458/14 (Dec. 6, 2013), adopted, COIB Case No (May 14, 2014), appended

Transcription

1 Conflicts of Interest Bd. v. Oni OATH Index No. 458/14 (Dec. 6, 2013), adopted, COIB Case No (May 14, 2014), appended Human Resources Administration employee borrowed $6,740 from eight subordinates. $6,000 fine recommended. NEW YORK CITY OFFICE OF ADMINISTRATIVE TRIALS AND HEARINGS In the Matter of CONFLICTS OF INTEREST BOARD Petitioner - against ADEMOLA ONI Respondent REPORT AND RECOMMENDATION KEVIN F. CASEY, Administrative Law Judge Petitioner brought this civil penalty proceeding, under Chapter 68 of the New York City Charter and Title 53 of the Rules of the City of New York, alleging that respondent, an associate job opportunity specialist for the Humarn Resources Administration (HRA), received loans totaling $6,740 from eight subordinates, in violation of sections 2604(b)(3) and 2604(b)(14) of the Charter (Pet. Ex. 2). Respondent did not file an answer. Under petitioner s rules, the failure to answer the petition is an admission of the allegations and petitioner is only required to submit for the record an offer of proof of the relevant facts. 53 RCNY 2-02(c)(3) (Lexis 2013); see Conflicts of Interest Bd. v. Norwood, OATH Index No. 1974/07 at 2 (July 11, 2007), adopted, Conflicts of Interest Bd. Case No (Oct. 10, 2007). Respondent, who retired from HRA, effective June 8, 2013, did not appear for the hearing on October 23, 2013 (Pet. Exs. 2, 13). Petitioner properly served respondent with the petition and notice of hearing at his last known address by first class and certified mail, return receipt requested (Pet. Exs. 1, 2, 13). See 53 RCNY 2-02(b) (Lexis 2013). Petitioner also repeatedly attempted personal service at respondent s last known address (Tr. 5-9). I found respondent in default and the hearing continued in his absence. The Department relied on audio

2 - 2 - recordings of interviews with respondent and his subordinates, documentary evidence, and the testimony of one witness from the Department of Investigation (DOI). For the reasons that follow, I find that petitioner proved the charges and recommend a $6,000 fine. ANALYSIS The essential facts are undisputed. Respondent was a manager at an HRA call center. From May 2011 to September 2012, he borrowed money from eight subordinates. On at least six occasions, he solicited loans at the workplace. In at least three instances, respondent asked the subordinate to come into his office regarding a complaint. He then told the subordinate that he was only joking about the complaint and he asked to borrow money. Some subordinates balked but they gave him money when he kept asking. The loans ranged from $40 to $2,500 and respondent borrowed more than once from some subordinates. He repaid all but $500 that he borrowed (Pet. Exs. 2, 3, 4). The petition alleged that respondent borrowed $6,740, but he may have borrowed one or two hundred dollars more than that (Pet. Exs. 3, 5-12). During interviews with investigators, the subordinates described how respondent asked them for money (Pet. Exs. 3, 5-12). Among other things, he told the subordinates that he needed the money to pay a traffic ticket, to pay a lawyer in connection with an IRS matter, and to travel to his native country, Nigeria (Pet. Ex. 5, 6, 8, 9, 10). In an April 2013 recorded interview with investigators, respondent admitted that he borrowed approximately $7,000 from his subordinates (Pet. Exs. 3, 4). He said that he considered the subordinates to be his friends and he borrowed the money because his mother, who lived in Nigeria and lacked medical insurance, had been diagnosed with a serious illness. Respondent also said that he owed more than $25,000 in back taxes to the IRS. Though respondent has worked for HRA since 1999, he claimed that he was unaware that he was not permitted to borrow money from subordinates (Pet. Exs. 3, 4). Public servants may not use their positions to obtain any financial gain or for other private or personal advantage. Charter 2604(b)(3). Nor may public servants enter into any business or financial relationship with a subordinate public servant. Charter 2604(b)(14). Respondent violated both provisions. He used his position to obtain a personal benefit by soliciting interest-free cash loans and he engaged in financial relationships with subordinates. See Conflicts of Interest Bd. v. Paige, OATH Index No. 605/11 at 4 (Dec. 15, 2010), adopted, Conflicts of Interest Bd. Case No (Mar. 17, 2011) (Sections 2604(b)(3) and 2604(b)(14)

3 - 3 - of the Charter violated where supervisor borrowed $3,000 from a subordinate). The charges should be sustained. FINDINGS AND CONCLUSIONS 1. Petitioner proved that it properly served respondent with the charges and notice of hearing. 2. Petitioner proved that respondent violated section 2604(b)(3) of the City Charter by using his position to obtain a financial gain or personal advantage. 3. Petitioner proved that respondent violated section 2604(b)(14) of the City Charter by entering into financial relationships with subordinates. RECOMMENDATION Petitioner requested a penalty in the range of $5,000 to $8,000 (Tr ). That is appropriate. Under similar circumstances, this tribunal has recommended fines roughly equivalent to the amount borrowed. See, e.g., Paige, OATH No. 605/11 at 6 ($2,500 fine recommended where public servant borrowed $3,000 from subordinate and did not repay it for nearly five years); Norwood, OATH No. 1974/07 at 4-5 ($4,000 fine recommended where public servant received $4,100 in loans from subcontractor). Though respondent did not dispute that he borrowed the money and he repaid most of the loans, a substantial fine is necessary because he repeatedly abused his position. This was not isolated indiscretion. Over and over again, respondent treated subordinates as if they were his personal bankers. Some of the subordinates told investigators that they were not pressured to make the loans and they felt sorry for respondent (Pet. Exs. 3, 12). But others said that they did not have much money themselves, they felt pressured, and they only capitulated after he kept asking for money (Pet. Exs. 3, 6, 7, 10, 11, 12). Accordingly, I recommend a $6,000 fine. December 6, 2013 Kevin F. Casey Administrative Law Judge

4 - 4 - SUBMITTED TO: NICHOLAS SCOPPETTA Chair APPEARANCES: ETHAN CARRIER, ESQ. Attorneys for Petitioner No Appearance by or for Respondent

5 THE CITY OF NEW YORK CONFLICTS OF INTEREST BOARD x In the Matter of ADEMOLA ONI COIB Case No OATH Index No. 458/14 Respondent x FINAL FINDINGS OF FACT, CONCLUSIONS OF LAW, AND ORDER Upon consideration of all the evidence presented in this matter, and of the full record, and all papers submitted to, and rulings of, the Office of Administrative Trials and Hearings ("OATH"), the Conflicts of Interest Board (the "Board") hereby adopts the findings of fact and conclusions of law contained in the annexed Report of OATH Administrative Law Judge ("ALJ") Kevin F. Casey dated December 6, 2013 (the "Report"), in the above-captioned matter. As recommended in the Report, and as further explained herein, the Board imposes a fine of $6,000 upon Respondent for violating Chapter 68 of the City Charter, the City's conflicts of interest law. This enforcement matter involves an associate job opportunity specialist for the Human Resources Administration (the "HRA") who solicited approximately $6,740 in total from eight of his subordinate HRA employees. In many instances, Respondent asked to borrow money after calling the subordinate into his office and in some instances asked subordinates into his office under the guise of a false complaint. The Respondent has repaid some but not all of the loans. By soliciting loans from individuals over whom he had authority in his HRA position and by using his position to solicit these loans, Respondent violated the following provisions of the City's conflicts of interest law: New York City Charter 2604(b)(14) This section states: "No public servant shall enter into any business or financial relationship with another public servant who is a superior or subordinate of such public servant." New York City Charter 2604(b)(3) This section states: "No public servant shall use or attempt to use his or her position as a public servant to obtain any financial gain, contract, license, privilege or other private

6 or personal advantage, direct or indirect, for the public servant or any person or firm associated with the public servant." Petitioner served Respondent with a Notice of Petition on August 14, 2013, alleging that Respondent violated Charter Sections 2604(b)(14) and (b)(3). The Petition sets forth, in its two Causes of Action, respectively, the two above-described violations of the City Charter stemming from Respondent's use of his HRA position for solicitations of loans from individuals over whom Respondent had authority. As the record herein demonstrates, and as ALJ Casey found, Respondent was given the opportunity to challenge the allegations about his conduct, but failed to answer the Petition and did not appear for the hearing scheduled for October 23, 2013, thus properly leading ALJ Casey to find him in default and to proceed with the hearing as an inquest. The evidence presented at the hearing, which included testimony by John Bellanie, an investigator from the New York City Department of Investigation ("DOI"), as well as summaries of interviews that he conducted, established, as the Petition alleged and the Report found, that Respondent solicited the loans in question from eight of his subordinates in amounts ranging from $40 to $2,500. In total, Respondent borrowed approximately $6,740 from May 2011 to September Six of the eight subordinates were called into Respondent's office where Respondent asked for a loan. Respondent sometimes borrowed money more than once from a subordinate. In at least three separate instances, Respondent called the subordinate into his office after telling the individual that Respondent had received a complaint about the particular subordinate and then Respondent exclaimed that he was only joking and proceeded to ask for a loan. Respondent told subordinates that he needed to borrow money for various reasons including to help with his ill mother in Nigeria and because he owed back taxes to the IRS. Respondent, during his interview with DOI, said that he was not aware that he could not borrow money from subordinates and that he asked to borrow money from them because those subordinates were his friends. In interviews with DOI, numerous subordinates stated that although they did not feel threatened by Respondent's requests, they loaned Respondent money 2 because they felt sorry for him and because he was a superior, though for many of the individuals, the Respondent was not a direct superior. Respondent paid back most of the loans but still owed $500 at the time of Respondent's retirement from HRA. At the conclusion of the inquest Petitioner requested a fine in the range of $5,000 to $8,000. ALJ Casey issued his Report on December 6, 2013, and found, as Petitioner had alleged, that Petitioner had properly served the Respondent with the charges and notice of hearing, that Respondent entered into financial relationships with subordinates in violation of Charter Section 2604(b)(l4), and that Respondent used his position to obtain a financial gain or personal advantage in violation of Charter Section 2604(b)(3). ALJ Casey recommended a fine of $6,000, consistent, he said, with OATH's precedent of recommending fines roughly equivalent to the amount borrowed, citing COIB v. Paige, OATH Index No. 605/11, COIB Case No (Mar. 17, 2011) (where the public servant was fined $2,500 for borrowing $3,000 from a subordinate) and COIB v. Norwood, OATH Index No. 1974/07, COIB Case No (Oct. 10, 2007) (where the public servant was fined $4,000 for

7 borrowing $4,100 from a subcontractor). ALJ Casey stated that Respondent repeatedly abused his position and treated subordinates as if they were his personal bankers. Following the issuance of the Report, the Board sent a copy of the Report to Respondent on December 19, 2013, and reminded him of the opportunity to submit to the Board any comments he might wish to make on the Report. Respondent did not, however, submit comments to the Report. The Petitioner, in contrast, submitted comments to the Report, requesting that the Board not adopt the ALJ's recommended fine amount of $6,000 and stated that Prosecuting Counsel erred in recommending a fine amount between $5,000 and $8,000 at the time of trial. Petitioner's comment instead requests an $8,000 fine, consistent, Petitioner argues, with Board precedent. Petitioner argues that the Board has historically imposed fine amounts significantly less than the amount borrowed where the loan had been paid back in full and the Board had reached a settlement with the Respondent. Additionally, Petitioner argues that the Board has imposed fines greater than the total amount of the loan where it has found that Respondent violated both Charter Sections 2604(b)(l4) and 2604(b)(3), citing COIB v. Jul. Williams, COIB Case No (Jun. 23, 2010) (where public servant was suspended for thirty days without pay, valued at $4,884, for using his position to obtain between $325 and $625 in loans from his subordinates) and COIB v. Geddes, COIB Case No (Oct. 17, 2008) (where a public servant was fined $250 and suspended for three days without pay, valued at $561, for using her position to borrow $400 in loans from her subordinates). Petitioner argues that a $6,000 fine is too low a penalty in this case where Respondent still owes on one of the loans, was found to have violated two Charter provisions, and failed to respond to Board settlement discussions and appear at the OATH hearing. The Board concurs in the ALJ's determination that the evidence establishes violations of the above-quoted prohibitions against entering a financial relationship with a subordinate, a violation of Charter Section 2604(b)(l4), and using one's City position to obtain a personal financial gain, a violation of Charter Section 2604(b)(3), when Respondent solicited loans from eight subordinates on multiple occasions using his office and position to ask for such loans. As 3 demonstrated by the actual recordings and summaries of DOI's interviews with Respondent and with the subordinates he borrowed from, Respondent admitted that he borrowed money from multiple subordinates for differing amounts and that he failed to fully repay all of the loans back in full. Since a loan is a financial relationship and the evidence establishes that each of the individuals Respondent borrowed money from is a subordinate, the loans plainly violated Charter Section 2604(b)(14), the ban on superiorsubordinate business or financial relationships. Furthermore, since the evidence also establishes that Respondent used his position as a superior in order to call subordinates into his office to ask to borrow money, sometimes under the false pretense of a workrelated complaint, Respondent plainly used his position to obtain a financial gain or personal advantage in violation of Charter Section 2604(b)(3). With regard to the penalty, the Board accepts ALJ Casey's recommendation to impose a fine of $6,000 upon Respondent for his violations of Charter Sections 2604(b)(l4) and 2604(b)(3). That recommendation falls within the range of $5,000 to $8,000 requested by Petitioner at the hearing. Without deciding whether Petitioner waived any right to object to a fine that falls within that range, the Board determines that,

8 based on a combination of factors here, including that the ALJ' s recommended fine falls within the range requested by the Petitioner and that the $6,000 recommended amount, although on the low side, is not significantly out of line with Board precedents, the recommended fine is appropriate. The Board notes that in appropriate cases it has found, and may in the future find, that the fine recommended by the OATH ALJ is insufficient. See, e.g., COIB v Hill, OATH Index No. 2199/11, COIB Case No d (May 3, 2012). For these reasons, the Board finds that Respondent violated Charter Section 2604(b)(14) and Charter Section 2604(b)(3), and, having consulted with Respondent's agency head pursuant to Charter Section 2603(h)(3), that the penalty for these violations shall be $6,000. WHEREFORE, IT IS HEREBY ORDERED, pursuant to Charter Section 2606(b), that Respondent be assessed a civil penalty of $6,000 to be paid to the Conflicts of Interest Board within 30 days of service of this Order. Respondent has the right to appeal this Order to the Supreme Court of the State of New York by filing a petition pursuant to Article 78 of the Civil Practice Law and Rules. The Conflicts of Interest Board By: Richard Briffault, Chair Fernando Bohorquez Anthony Crowell Andrew Irving Erika Thomas-Yuille Dated: May 14, 2014