Ferreting Out White Collar Corruption in Municipal Government: Cronies

Posted on July 7, 2014

Steve Mensing, Editor

♦  Almost invariably when investigators go after municipal white collar crime, they notice specific patterns universal to municipal corruption:

• The mayor and city council are entrenched–they stayed too long.  This is a golden opportunity for graft and corruption to take root.  Some elected officials become careless over time and forgo diligent attention.  A culture of “Everybody’s doing it” develops when nobody is watching the pot.  In some cases department heads take the bite out of city credit cards and use them for personal use.  They have been dirtied and are less apt to talk.

• The municipal government lacks any meaningful transparency.  They are slow to answer Freedom of Information Act inquiries, avoid answering them altogether, deny certain documents exist, submit emails requiring decoding programs, provide “substitute” documentation, or deliberately offer only partial information on a request.  Ducking complete Freedom of Information Inquiries is one of the surest signs of government corruption.  Municipal clerks who collude in this activity or obstruct investigations may be viewed as accessories to crime.

• An excess of city hall cronies–long time “friends” of city bosses or city council who follow orders and don’t bark at unusual “requests”.  Cronies profit from illegal activities and keep their mouths shut until the law comes down on them.

• Large sums of money disappear all too quickly from municipal projects.

• Glaring cover-ups of mysterious government situations.

• City management has a history of ordering reprisals and vendettas against those who don’t play ball.  Code violations and the like.

• Attempts to discredit media and investigators as liars, pot stirrers, naysayers, or having an agenda.

• Government officials noted for deceptive statements.

• Red flags for kickbacks, bribes, and no bid contracts.

• Businessmen and contractors report being approached for “pay for play”.

In today’s article on “Ferreting Out White Collar Corruption in Municipal Government” we will focus on cronies.

What are Cronies?

Cronies are long-standing friends often appointed to positions of authority.  In a municipal government they might be the heads of utilities, chief of police, an HR director, risk manager, or maybe even the city spokesperson.  These persons are often counted upon to do the bosses bidding and look the other way when rules and laws are being bent.  The crony, being a trusted friend, may be unqualified for the job.  They follow the bosses script and never veer from it.

Because municipal governments handle many millions of dollars in public money they sometimes attract unethical officials or spawn them over time when the city government grows an “old boys club” or  an “in-group”.  Appointed friends are not uncommon.  The challenge is the crony obtained his or her position not through qualifications, experience, or accredited credentials, but through favoritism, friendship, and special connections.  “It ain’t what you know–it’s who you know.”

Cronyism may also go beyond individuals.  It may include special groups and organizations.  Those groups and organizations may be favored or gain strong influence enough to manipulate job promotions, contract bidding, hiring, and pay raises.

The effects of cronyism may have devastating affects on a municipal government: huge financial losses for the taxpayer, dishonest business practices, lack of real competitive contract bidding, poorly done government projects, inflated costs in city services passed onto the utility payer, a breakdown of the city’s economic vitality and loss of city services.  The public good is undermined.

Many recall the appointment of Michael D. “Brownie” Browne as the head of the Federal Emergency Management Agency (FEMA) during the Bush administration and the performance of FEMA during Hurricane Katrina.  “Brownie” was  frequently cited as an example of cronyism.  Browne had no qualifications as the FEMA head save for his friendship with Bush.  FEMA came under fire for its lack of performance in New Orleans in the aftermath of Katrina.






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