The chairman of the Pennsylvania Turnpike Commission, Mitchell Rubin is accused in the US indictment of Senator Vincent Fumo and three associates of multiple counts of defrauding the state of Pennsylvania. Identified mostly as Senate Contractor # 5, Rubin is never named in the 272 page indictment but he is described as a former boyfriend and later husband of Ruth Arnao, and as holding the position of chairman of the Pennsylvania Turnpike Commission.

Rubin's wife, Ruth Rubin who also goes by the name Ruth Arnao is herself indicted along with Fumo and two senate aides on 139 counts of thievery, fraud, income tax evasion, obstruction of justice and other offenses. The indictment by a federal grand jury was released by federal prosecutors Feb 6.

Ruth Rubin, wife of the chairman was personally hit with 45 criminal charges. Like Fumo she was arrested this week, pled not guilty, and is free on bail pending trial.

Of immediate concern to the Turnpike Commission is that its chairman though not yet himself charged with any offense is accused of several offenses in the text of the indictment. Rubin is called "a close friend of Fumo" and "became a Senate contractor (who) did little or no Senate work in exchange for the large sums of senate money that Fumo awarded him under a SDAC (Senate Democratic Appropriations Committee) contract." (p44 #88)

Accused of accepting $150k for no work product

The fraud charged against Mitchell Rubin is that he provided no work product in return for a contract providing "professional services to the (Senate) Democratic Appropriations Committee to include, but not be limited to research, analysis, and make recommendations on legislative matters, assist on constituent services." (p45 #90) The contract arranged with Rubin by Sen Fumo paid him $150k or $30k/year for five years 1999 to 2004 (when the feds were well into their investigation of Fumo).

The indictment states: "Neither the Senate nor (Rubin's) firm possesses any documentary evidence, such as notes and reports, showing that he or his firm ever provided any 'research, analysis (or) recommendations on legislative matters' or anything related to constituent services...(Rubin) did little or no actual senate work at all." (p45 #91)

One indictment of Fumo (p62 #143) relates specifically to a corrupt contract (Service Purchase Contract # 209664 on or about Sept 9 1999) that Fumo did with Mitchell Rubin, then a regular member of the Turnpike Commission board, now chairman. Other "Overt Acts" involving corrupt state payments directly involving Mitchell Rubin: p66 #167, p70 #189. Specific criminal counts against Fumo involving Mitchell Rubin as the beneficiary include Count 4 Sept 16 2002 $2,350, Count 5 Aug 31 2003 $2,300.

Rubin would appear to be the instigator of the Turnpike's phony contract that yielded $220k in 2003 and 2004 for the man called Senate Contractor 4, now identified as S Michael Palermo and a former senior official of the Turnpike and major shareholder in Fumo's Philadelphia bank. Palermo worked in developing Fumo's Halifax farm, according to details in the federal indictment.

Fumo had Palermo on the state senate payroll - like Mitchell Rubin - for $5k/month. Fumo's move of Palermo from the senate payroll to the turnpike payroll in the spring of 2003 (p119 #69) coincides with Rubin's elevation to chairmanship of the Turnpike Commission and Joseph Brimmeier's appointment as chief executive.

Rubin's trip to Cuba by Rubin paid for by Philadelphia Citizens Alliance for Better Neighborhoods

The indictment says (p138 #i) that between Nov 17 and 20 in 2001 Mitchell Rubin visited Cuba with expenses of $22,000 paid by Citizens Alliance - a non-profit controlled by Fumo and Ruth Arnao/Rubin. The Citizens Alliance declared purpose was "to promote public health, housing, safety and education in the city and county of Philadelphia." In fact it was used for political work and to pay for all kinds of personal expenses for Fumo and Arnao. Citizens Alliance was, for example hit up to finance equipment such as a bulldozer, all-terrain vehicle, and pickup truck used at the Halifax farm being looked after by Palermo on the $120k/year "consulting fees" paid by the Pennsylvania Turnpike Commission.

Mitchell Rubin also got entangled in a scheme of Fumo's to use yachts of the Independence Seaport Museum for vacation cruises to Martha's Vineyard MA. Fumo misused his position on the Seaport Museum board to commandeer their boats in violation of Museum rules for pleasure cruises. Catering bills and other expenses of over $5k were incurred in a pleasure cruise in Florida with Mitchell Rubin Feb 21 2000, with expenses charged to the Museum. (p186 #10) Fumo's misuse of Seaport Museum boats is estimated by the feds to have cost it $100k, the indictment states.

To be fair to Rubin it is not clear that he knew Fumo and Arnao misappropriated money for his trip to Cuba from the South Philly charity or knew of Fumo's mischarging of expenses for the pleasure cruises. But when you go along for a ride with the likes of Vincent Fumo you have to be a real dope to think he's paying out of his own pocket.

Palermo's $120k contract with PTC reported earlier

Palermo's $10k/month no-work contract with the Turnpike was first reported in the Pittsburgh Tribune Review Jan 9 2005 when Brad Bumstead wrote: "The turnpike pays $120,000 per year to M&P Consulting of Hummelstown, the firm of Michael Palermo, a friend of powerful state Sen. Vincent Fumo, D-Philadelphia."

What is new is the statement in the grand jury indictment of Feb 6 that the Pennsylvania Turnpike "has no records reflecting that any work was ever performed" on the contract. (p43 #83) The grand jury indictment notes that what it calls a "lucrative consulting contract" was awarded to Palermo by the Turnpike "within two months after (Mitchell Rubin), a member of Fumo's inner circle of friends and the boyfriend (later husband) of Ruth Arnao was elected chairman of the PTC."

Palermo was a major shareholder in Vincent Fumo's PSB Bancorp parent of First Penn Bank in Philadelphia, out of which Fumo recently got about $18m for his shares plus a personal "golden parachute" of $6.3m in a sale to Conestoga Bank.

A source at the Turnpike tells us Palermo was involved in a dubious real estate deal back when the Turnpike established an Eastern Regional Office in the Philadelphia area, but we have nothing more on that.

According to a source at the Turnpike the federal indictment has caused shock among what he calls the Fumo Gang there. He says they have gotten away with grand larceny for so long they regarded themselves as untouchable.

"It wasn't even the stealing which rankled the most but their smugness, their arrogance, the sense they gave that no one could stop them, and they could do whatever they liked. The overwhelming feeling here is: at last! At last they are getting what they deserve. We've waited a long, long time."

Presumption of innocence - COMMENT

The court is under an obligation to give Fumo and his associates a presumption of innocence. No one else is. We think they are guilty as hell. The indictment is a small book. It meticulously documents its charges and lays out overwhelming evidence of Vincent Fumo as terminally corrupt. The man prided himself on living high off other people's money - "OPM" in his favorite acronym. The man is a sociopath, a compulsive criminal.

Just read the evidence at http://www.usdoj.gov/usao/pae/News/Pr/2007/feb/Fumoind.pdf

TOLLROADSnews 2007-02-09 REVISED 2007-02-10