NEW YORK, MAY 19 -- The Mafia's grip on the city's $5 billion construction industry has turned it into a cesspool of bribery, extortion, false billings, tax fraud, no-show jobs, minority fronts, bid rigging, violence and sabotage, according to a state report released today.
The 130-page report by the state's Organized Crime Task Force says those in the industry have "become dependent on" corruption. It describes a system in which major developers "ignore" racketeering while reaping its benefits, contractors willingly pay off mob figures to preserve labor peace and unions make themselves easy targets for mob control.
Mafia infiltration extends to carpenters, laborers, teamsters, blasters, steam fitters, boilermakers, house wreckers, truck drivers, plasterers, mason tenders and concrete and drywall contractors, the task force said.
Organized crime, particularly in the cement industry, has driven up the cost of building in Manhattan by as much as 20 percent and has affected such major projects as Trump Plaza and the Jacob K. Javits Convention Center, according to previous testimony and indictments.
Legitimate contractors frequently cooperate with mobsters because they know that "they will only have to pay off once, that the amount will be reasonable and that the services paid for will be delivered," the report said. It also blamed "organized labor's unwillingness or inability to keep its own house clean."
Gov. Mario M. Cuomo (D), who has created a new racketeering task force aimed at the construction industry, told a news conference that many business and labor leaders "are addicted to this corruption. It has a hold on the system." He likened the battle to the war on drugs, where he said widespread demand has made government efforts ineffective.
Joseph H. Newman, chairman of the New York Building Congress, said most contractors "are hardworking, honest people and they are the victims . . . . We don't think the building community should be tarred and feathered for the dishonesty of a few bad apples."
Lewis Rudin, chairman of Rudin Management Co., said undue publicity about corruption "makes people gun-shy about coming in here and doing business." Citing the gang-busting work of the Waterfront Commission on New York Harbor, he said, "Now we have no corruption and no waterfront business."
"Bribes, 'grease payments' and tips are a way of life in New York City's construction industry," often demanded by government and union officials, the report said. " . . . It has become relatively easy to pass the costs of corruption on to consumers."