Trial Opens in Alleged Corruption at MTA

In the first trial to examine allegations of corruption at the Metropolitan Transportation Authority, a federal prosecutor Tuesday argued that a “lack of checks and balances” at the agency enabled a New York consultant to bribe the MTA’s former insurance chief to secure $425,000 in contracts.

“This is about a contractor who paid off a public official to get work and keep that work coming in,” Assistant U.S. Atty. Marc S. Harris said in his opening statement to jurors at U.S. District Court in Los Angeles. “The checks and balances that the agency has today were not in place.”

Harris promised jurors he would prove that consultant John D. McAllister made 30 payments totaling more than $100,000 to former MTA risk management chief Abdoul R. Sesay, and others on his behalf, from 1992 to 1994.

Sesay pleaded guilty in August 1995 to accepting kickbacks as a reward for recommending that McAllister receive MTA work, and is scheduled to testify today. He has not yet been sentenced.

McAllister’s attorney disputed the government’s charges, contending in his opening remarks that his client had been friends with Sesay for 12 years at the time he was hired and considered all the payments to be loans.

“Abdoul Sesay on a regular basis was borrowing money from almost everyone he ran into--it was a constant in his life,” said the attorney, W. Michael Mayock.

Outside the courtroom, Mayock said in an interview that his client was simply a “very generous” man. “He made loans to people all the time,” Mayock said. “He is what you might call a soft touch.”

The case comes at a time when the MTA can least afford a spotlight trained on allegations of corruption of its officials. The agency is fighting for credibility in Congress to sustain subway construction funding and is currently the subject of investigations by federal prosecutors in Los Angeles and a U.S. Senate committee.

In 1992, Sesay was managing the MTA’s efforts to obtain insurance to cover the risks of building several rail projects in the county, including the subway. His department was understaffed, according to testimony from two former co-workers Tuesday, and he received authority from the MTA board in 1992 to hire five consultants as a “brain trust” at a total cost not to exceed $750,000.

Harris argued that Sesay recommended McAllister for contracts initially worth $275,000 with the understanding that his old friend would “take care of him” in return. The consultant was paid $185 an hour plus expenses.

As a result, Harris said, McAllister kicked back to Sesay a portion of almost every check he subsequently received from the MTA. About $30,000 of the alleged bribes, Harris said, came in the form of payments on an American Express card that McAllister gave Sesay to use.

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Attempting to describe how the relationship was established without raising suspicion among top MTA executives, Harris said the agency at the time gave project managers like Sesay virtually sole discretion to hire consultants and approve their invoices.

Victor Mendez, who was Sesay’s second in command at the time but now works for a private accounting firm, told jurors he complained several times to his boss that McAllister had either overcharged the agency, not performed up to standards or was absent for hours without explanation during workdays.

Mendez said Sesay vowed to reprimand McAllister and dock his payments, but instead continued to sign off on every one. Sesay ultimately augmented McAllister’s contract twice to pay out the maximum possible without board approval until the consultant received $425,000, Mendez said.

Mayock told jurors that his case will come down to whether they believe Sesay, who has admitted committing felonies, or McAllister, who has no criminal record.