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Investigations of Possible Fraud at LIPA

LongIsland.com

The Moreland Commission is investigating the exchange of millions of dollars between LIPA and the Navigant firm.

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A Governor Cuomo appointed commission is investigating the Long Island Power Authority and the Navigant firm. Cuomo's Moreland Commission is set to bring all their findings of possible fraud to Federal Prosecutors in Brooklyn.
 
This isn't the first time the Moreland Commission went after LIPA. In January the Commission told Cuomo to get rid of the company altogether and replace it with another one. Cuomo recently followed their advice but the commission wasn't finished with their electric company crusade.
 
The main guy being looked into is Michael D. Hervey. Hervey, the former acting chief executive at LIPA during Hurricane Sandy, left the company after Long Islanders harshly criticized the company for leaving them in the dark while the lights were turned on next door in New York City. Following Sandy, the New York times reported LIPA spent 39 seconds of a meeting discussing the upcoming storm we came to know as Superstorm Sandy. After leaving LIPA, Hervey made Navigant his home last January.
 
The Moreland Commission started looking more into the Navigant/LIPA connection after finding out the amount of money the companies exchanged in recent years. In four years, LIPA paid $65 million to consultants and $28 million went to Navigant. In 2010, two years before Hervey went to Navigant, Hervey signed a five year contract extension worth $23 million. In 2011, Hervey approved half of a $7.2 million bill to LIPA from Navigant.
 
The Commission found that 50 consultants from Navigant charged LIPA with hourly rates of $300 and $500. Some consultants racked up over 1,800 hours a year and one consultant documented 3,700 hours. Another Navigant consultant collected $4.5 million from LIPA for five years. LIPA paid that one particular consultant more than they did any other firm.
 
There were also consultants who took unexplained trips to Puerto Rico. Another Navigant consultant's luxurious trip included being reimbursed $6,800 for staying in a lavish New York City Hotel. The state government's guideline is $295 a day. The icing on the cake for all of this is that LIPA customers were charged $15 million more than what they should have.
 
The Moreland Commission also looked into Con Edison but the only wrong doing they found was that the New York City based electric company wasn't prepared for the storm. It wasn't anything close to the possible corruption between LIPA and Navigant.
 
Governor Cuomo is also getting the Moreland Commission together to sick them on any any potential government corruption in the state.
 

[Source: New York Times]