November 3, 2007

The Long Run

Loyal to Kerik, Giuliani Missed Warning
Signs

By MICHAEL
POWELL

This article was reported by Russ Buettner, Michael Powell and William K.
Rashbaum and was written by Mr.
Powell.

If the rise of Bernard
B. Kerik under the mentorship of Rudolph
W. Giuliani was meteoric, the speed of his fall was breathtaking.

In December 2004, President Bush nominated Mr. Kerik, a former New York
police commissioner, to head the federal Department
of Homeland Security. Seven days later, Mr. Kerik withdrew as a nominee.

A cascade of questions followed about his judgment as a public official, not
least that he had inappropriately lobbied city officials on behalf of Interstate
Industrial, a construction firm suspected of links to organized crime. Mr.
Giuliani defended Mr. Kerik, a friend and business partner, whom he had
recommended to the Bush administration. But he also tried to shield himself from
accusations that he had ignored Mr. Kerik’s failings.

“I was not informed of it,” Mr. Giuliani said then, when asked if he had been
warned about Mr. Kerik’s relationship with Interstate before appointing him to
the police post in 2000.

Mr. Giuliani amended that statement last year in testimony to a state grand
jury. He acknowledged that the city investigations commissioner, Edward J.
Kuriansky, had told him that he had been briefed at least once. The former mayor
said, though, that neither he nor any of his aides could recall being briefed
about Mr. Kerik’s involvement with the company.

But a review of Mr. Kuriansky’s diaries, and investigators’ notes from a 2004
interview with him, now indicate that such a session indeed took place. What is
more, Mr. Kuriansky also recalled briefing one of Mr. Giuliani’s closest aides,
Dennison Young Jr., about Mr. Kerik’s entanglements with the company just days
before the police appointment, according to the diaries he compiled at the time
and his later recollection to the investigators.

The additional evidence raises questions not only about the precision of Mr.
Giuliani’s recollection, but also about how a man who proclaims his ability to
pick leaders came to overlook a jumble of disturbing information about Mr.
Kerik, even as he pushed him for two crucial government positions.

“Rudy can fall for people big time, and sometimes qualifications are
secondary to loyalty,” said Fran
Reiter, a former Giuliani deputy mayor who now supports Hillary
Clinton. “If he gets it in his head he trusts you, he is extremely
loyal.”

Mr. Giuliani has routinely met loyalty with loyalty, standing by political
allies and friends in their darkest hours. Giuliani Partners, for example, his
consulting firm, employs a high school friend, Msgr. Alan Placa, despite
allegations that he sexually molested young men years ago.

Mr. Giuliani has said he believes in his friend, who has denied the
allegations and was not criminally charged.

In Mr. Kerik’s case, by the time Mr. Giuliani recommended him for the federal
job, his administration knew that Mr. Kerik had acted on behalf of Interstate
Industrial. It also knew that he had drawn criticism for a range of other
incidents, from sending detectives to search for his lover’s cellphone to using
officers to research his autobiography.

Mr. Kerik, who declined to speak about his troubles, now faces possible
indictment on a range of federal felony charges, including perhaps tax evasion
and bribery, stemming in part from his acceptance of $165,000 in renovations to
his Bronx apartment paid for by Interstate. In June 2006, he pleaded guilty in
the Bronx to state misdemeanor charges relating to the same renovations.

Though Mr. Giuliani’s rivals for the Republican presidential nomination have
not made an issue of Mr. Kerik, his indictment could be a major embarrassment
for Mr. Giuliani.

Mr. Giuliani, who also declined to comment, still vigorously defends Mr.
Kerik’s performance as police commissioner. He told the grand jury that Mr.
Kuriansky concluded that nothing in Mr. Kerik’s background, including his ties
to Interstate, precluded his appointment as police commissioner.

But Mr. Giuliani now acknowledges that he should have re-examined his friend
before recommending him to the White House and that his recommendation had
indeed been a mistake.

In 2000, more than half the mayor’s cabinet had opposed Mr. Kerik’s
appointment to be police commissioner. His detractors had noted, among other
concerns, that Mr. Kerik did not have a college degree, a department requirement
at the time for captains and above.

Mr. Giuliani waved off the dissenters. “I believe that the skill I have
developed better than any other was surrounding myself with great people,” Mr.
Giuliani wrote in his 2002 book, “Leadership.”

“Too many leaders overlook candidates with unusual résumés because of a
failure of nerve,” Mr. Giuliani wrote. “By the time I appointed Bernie Kerik, I
had hired so many people that I was immune to such criticisms.”

Tapped for Power

The men who would become patron and protégé first met at a fund-raiser in
1990 in New Jersey honoring a slain New York City police officer.

Mr. Kerik was a comic book hero come to life, a decorated undercover
detective with a ponytail and earrings, thick biceps and a taste for four-letter
words as nouns, verbs and adjectives. He cultivated relationships with powerful
people, including an influential sheriff who five years earlier had made him the
youngest jail warden in the history of Passaic County, N.J.

When Mr. Giuliani ran for mayor in 1993, Mr. Kerik organized his security
detail of off-duty officers, reserving the weekend shift for himself.

When Mr. Giuliani became mayor, he gave Mr. Kerik a job in the Correction
Department. A year later, the mayor asked him to drop by Gracie Mansion.

The two men sat upstairs and shared a bottle of red wine, a gift to the mayor
from Nelson
Mandela. Mr. Giuliani said he planned to appoint Mr. Kerik as first deputy
correction commissioner.

Mr. Kerik, who wrote of this in his autobiography, “The Lost Son,” was taken
aback; he was a year removed from being a police detective.

“Mayor, I appreciate your confidence in me, I really do,” he said. “But I ran
a jail. One jail. Rikers is like 10 jails.”

Just do it, the mayor replied.

Mr. Kerik followed Mr. Giuliani downstairs to a dimly lighted room. There
waited Mr. Giuliani’s boyhood chum Peter
J. Powers, who was first deputy mayor, and other aides. One by one, they
pulled Mr. Kerik close and kissed his cheek.

“I wonder if he noticed how much becoming part of his team resembled becoming
part of a mafia family,” Mr. Kerik wrote. “I was being made.”

Mr. Kerik was named correction commissioner in 1997. He brooked no slacking.
He startled sleepy wardens by walking cellblocks at 2 a.m. Violence plummeted,
and he basked in good press.

Behind the scenes Mr. Kerik ruled like a feudal lord, many former employees
have said. He had taken up with a woman who was a correction officer; he was
accused of directing officers to staff his wedding. He befriended the agency’s
inspector general, whose watchdog responsibilities require keeping an
arm’s-length relationship, and the investigator attended his wedding.

As the years passed, one of his top deputies was convicted of taking $142,000
from a Correction Department charity that Mr. Kerik headed. Another deputy,
Anthony S. Serra, became a warden at Rikers
Island even after he was accused of coercing officers to work on Republican
campaigns. He was later convicted of forcing staff members to do campaign work
and dispatching officers to renovate his upstate home.

Building Suspect Ties

Mr. Kerik earned $150,500 as commissioner but pleaded poverty. He turned to
Lawrence V. Ray, a friend of a few years, who had an engaging manner and a big
bankroll.

In 1998, Mr. Ray was the best man at Mr. Kerik’s wedding — and paid for much
of the event. Weeks later, Mr. Kerik recommended Mr. Ray for a $100,000 job with
Interstate Industrial Corporation, a New Jersey-based construction firm with
tens of millions of dollars in city contracts.

Two years earlier, the owners, Peter and Frank DiTommaso, had paid more than
$1 million to buy a transfer station from Edward
Garafola, a mob soldier, and hoped to obtain a city operating license. But
city investigators had found that the company employed mob figures and used
mob-controlled trucking firms.

The DiTommasos, who adamantly and repeatedly have denied any ties to
organized crime, hoped Mr. Ray could help resolve their problem with the
Giuliani administration. Soon after being hired, Mr. Ray took Frank DiTommaso to
meet with his friend the correction commissioner.

Mr. DiTommaso recalled the moment for city investigators: “Mr. Ray walked
into the office, unannounced, just walked right in; Mr. Kerik got up and came
around the desk and give him a big hug and a kiss.”

Within months, Interstate had hired Mr. Kerik’s brother and the commissioner
had begun lobbying behind the scenes for Interstate.

One night in July 1999, he sat in Walker’s, a bar in downtown Manhattan,
defending Interstate to Raymond V. Casey, a cousin of Mayor Giuliani who was
chief of enforcement for the city commission that was reviewing Interstate’s
license application. Later that year Mr. Kerik telephoned an assistant
commissioner at the Department of Investigation to say that Interstate’s owners,
as far as he knew, were clean of mob taint, according to a person familiar with
her account.

And that September he had city detectives investigating the company meet Mr.
Ray in his city office, a location that underlined for the men that the company
had powerful friends.

The lobbying stopped on March 2, 2000, when Mr. Ray and Mr. Garafola, the mob
soldier, were indicted on federal charges in an unrelated stock scheme. Top
Giuliani officials suspended Interstate’s $85 million in city contracts.

Three weeks later, Mr. Kerik sat down for a nearly two-hour interview with
top officials at the Department of Investigation. He talked about his
relationship with Mr. Ray and the DiTommasos, about the hiring of his brother
and the meeting at Walker’s.

He neglected to mention a key fact: Interstate was paying for $165,000 worth
of renovations on his new apartment in the Bronx.

Vetting Giuliani’s Choice

That July, Police Commissioner Howard
Safir said he intended to resign. Mr. Giuliani narrowed the field of
candidates to two: Chief of Department Joseph P. Dunne and Mr. Kerik, the
correction commissioner, who had spent eight years as a police officer.

Mr. Kuriansky, the investigation commissioner, oversaw the background checks.
The agency is designed to be semi-independent, but Mr. Giuliani had torn down
that wall, senior investigators said, appointing friends like Mr. Kuriansky as
commissioner and having them attend his morning meetings.

Mr. Kuriansky, a former special prosecutor, knew that Mr. Kerik had
intervened on behalf of a firm suspected of mob ties and that the commissioner’s
brother and best friend worked for the company.

But he did not know that Interstate had paid to renovate Mr. Kerik’s
apartment. And records indicate Mr. Kuriansky did not think the known record was
enough to disqualify Mr. Kerik.

On July 27 that year, according to Mr. Kuriansky’s diaries and his later
recollection, he briefed the mayor and Mr. Young, Mr. Giuliani’s close aide, on
Mr. Kerik’s relationship with Mr. Ray and Interstate.

Handwritten notes, taken by a city investigator during a December 2004
interview with Mr. Kuriansky, described his recollection: “Meet with RG &
DY, discuss BK background review, Ray issue.”

Mr. Kuriansky’s diaries say he conducted a similar briefing for Mr. Young on
Aug. 14, 2000, five days before Mr. Kerik’s appointment. Later, in his
conversation with city investigators, Mr. Kuriansky summed up what he had
related to Mr. Young: “Ray connection to BK, Ray was best man, brother worked at
IS - all reported to DY.”

Mr. Young, through a spokeswoman, declined to be interviewed.

Last year before the grand jury, Mr. Giuliani said that he recalled receiving
a briefing on Mr. Kerik’s background, but that neither he nor his aides
remembered delving into Interstate or Mr. Ray. Even Mr. Kuriansky had trouble
recalling the briefings, he said.

Mr. Kuriansky died in July. He refused numerous interview requests before his
death and never explained why he did not seem more troubled by Mr. Kerik’s
entanglements with Interstate, which seem to violate city conflict of interest
rules.

On Aug. 19, 2000, Mr. Giuliani decided the job was Mr. Kerik’s, saying that
he saw a fiercely loyal man with natural leadership ability. One Giuliani aide
who attended some of the meetings on the choice said he never knew of Mr.
Kuriansky’s findings and does not believe the mayor would have overlooked such a
problem.

“Had any of us known of Bernie’s relationship to Interstate, it would have
demolished him as a candidate,” said the former official. “It’s kind of
mind-boggling.”

Trouble at the Helm

Mr. Kerik’s 16-month tenure as police commissioner generally drew plaudits.
Crime fell, relations with black leaders improved and Mr. Kerik’s ties to Mr.
Giuliani grew tighter, to the point where he named the mayor the godfather of
his daughter.

Behind the scenes, Mr. Kerik surrounded himself with police and correction
buddies. When his book publisher and lover, Judith
Regan, believed someone had stolen her cellphone and a piece of her jewelry,
a Kerik aide dispatched elite homicide detectives to question suspects.

In researching his book, Mr. Kerik sent officers to investigate his mother’s
death, an abuse for which the city’s Conflict of Interest Board later fined him
$2,500.

None of the ethics problems seriously damaged Mr. Kerik, though, and when
terrorists attacked the World Trade Center, Mr. Kerik won public acclaim,
largely because he displayed steady resolve at Mr. Giuliani’s side.

Three years later, after his federal nomination was withdrawn, it was
discovered that he had used an apartment originally set aside for weary rescue
workers at ground zero as a nest for an extramarital affair with Ms. Regan.

After Mr. Giuliani left office in 2002, Mr. Kerik joined him at his new
consulting firm, Giuliani Partners. In 2003, President Bush sent Mr. Kerik to
Iraq to reorganize the Iraqi police force. In Baghdad, he signed autographs,
surrounded himself with South African bodyguards, slept during the day and
joined Iraqi paramilitary units on corruption raids late into the night. He
decided to leave suddenly after three months.

He campaigned hard for President Bush’s re-election the next year, bonding
with the president on the campaign trail and speaking at the Republican
National Convention in New York.

After the election, Mr. Bush sought a director of homeland security. Mr.
Giuliani was among the people who promoted Mr. Kerik for the job, and even
helped him prepare for the interviews.

By this time, Mr. Kerik’s former warden, Mr. Serra, had been indicted.
Another top aide, Frederick J. Patrick, had been sentenced to prison and had
been told to reimburse $142,000 taken from the foundation he ran with Mr. Kerik.
And newspapers had written of Mr. Kerik’s efforts to protect a correction aide
accused of beating his lover.

But if Mr. Giuliani or Mr. Bush took notice, the issues did not give them
pause.

“He was a champion of him,” Andrew
Card, chief of staff to Mr. Bush at the time, recently recalled of Mr.
Giuliani. “It wasn’t an arm-twisting session. It was more of a character
reference.”

Mr. Kerik’s tenure as a nominee lasted one week. He withdrew when he and Mr.
Giuliani said they discovered that his nanny was in the country illegally and
that he had failed to pay taxes for her.

Worse news was coming. Newspapers reported that Mr. Kerik had accepted
undisclosed cash gifts from Mr. Ray and lobbied for Interstate. At the time, Mr.
Giuliani said he was not inclined to second-guess his choice of Mr. Kerik as
police commissioner.

“Sometimes you look back on some of these choices and you made the wrong
one,” he said. “In this case, he turned out to be the right one.”

Less than two years later, though, Mr. Giuliani would find himself being
grilled about that choice. On April 20, 2006, before a state grand jury, a
prosecutor in the Bronx district attorney’s office peppered Mr. Giuliani, one of
the most powerful prosecutors in the late 20th century, about his apparent lack
of memory.

Would you have considered it unusual and significant, the prosecutor asked,
if as mayor in 2000 you had been told that a close friend of your correction
commissioner had been indicted in a federal case with organized crime
figures?

“It’s really a hypothetical question,” Mr. Giuliani replied. “I mean, sure,
it would have been unusual, sure.”

There was nothing hypothetical about the question. The prosecutor was merely
laying out the facts established by the Department of Investigation in the
months before Mr. Giuliani appointed Mr. Kerik police commissioner.

Yesterday, Mr. Kerik’s lawyer met with federal prosecutors in New York in an
effort to stave off indictment. In a recent interview, Mr. Kerik said that he
had been steering clear of Mr. Giuliani, lest his troubles hurt his friend,
although they did cross paths at the Sept. 11 ceremony at ground zero this
fall.

“We have not communicated in months, at all, at all,” he said. “When the last
time is, I could not even tell you.”

Elisabeth Bumiller and Eric Lipton contributed
reporting.

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