Saturday, December 1, 2007


Rudy Put $400,000 In Advance Funds On Credit Card For Travel Expenses
By Paul Kiel and Greg Sargent - November 30, 2007, 7:20PM

We've been swimming in credit card receipts from Rudy Giuliani's administration today, and one thing in particular has struck us: in 2001, apparently with an eye to future globetrotting, Giuliani's administration sent a check for $400,000 to American Express. Though it was billed to the Assigned Counsel Administrative Office, an office that provides lawyers for indigent defendants, the money served as an advance against future travel and other expenses later incurred by the mayor's office and his security detail.

The unusually large prepayment, as yet unreported, adds weight to the theory that the Giuliani administration was using accounting gimmicks to obscure his office's travel expenditures.
With $400,000 prepaid on the Amex account, the mayor and his staff drew down on the credit card for a number of trips, including a handful out to the Hamptons, where Judith Nathan had her condo. Giuliani's administration ultimately spent approximately $100,000 of the $400,000 before leaving office in January, 2001.

Stu Loeser, a spokesman for Mayor Bloomberg, confirmed to us that his administration put a stop to the practice of putting funds for future travel in bulk on a credit card. Shortly after Bloomberg took office, American Express refunded $298,000, the remaining unused balance on the account. The move came shortly after the city comptroller sent the mayor a letter critical of the Giuliani adminsitration's practice of billing obscure city agencies for mayoral travel expenses.

But Loeser declined to comment when asked directly why the administration did this, and declined to comment when asked directly if the Bloomberg administration thought the Giuliani approach was problematic. "We process spending and travel differently," he said. "We use a different method. If we have government funded travel, we go through the city's travel agent."
Prepaying a city credit card with such a large amount is a procedure that "appears intentionally opaque," a high-level budget official under a previous administration told us. "You're not able to see clearly what [the money] is being used for," the official said, "because it's bundled in an AmEx card as opposed to as direct payments to vendors."

The unusual $400,000 prepayment is revealed in a letter from Giuliani's deputy director of fiscal operations that was contained in a package of documents City Hall released today, in response to reporters' questions about Wednesday's Politico story. You can see the letter here.
Giuliani's administration had done a similar thing in June of 2000, cutting checks for $54,000 worth of "prepayment" and billing them to the New York City Loft Board and other backwater agencies.

YFP says.....and now Joe Lhota, former aide and present campaign assistant, blames it on the police.

Another Giuliani defense from Giuliani media flack Joe Lohta: “[T]he practice started when officers on his security detail complained that the police department was slow to reimburse them for rental cars and lodging.” Josh Marshall explains why this is still a red herring: “Not to state the obvious again, but this doesn’t tell us anything about why the expenses were squirreled away in the budgets of obscure city offices. It’s non-responsive. But is it even true?”