John Liu, City Comptroller, Defends Statements in CityTime Scandal

Preet Bharara, U.S. Attorney for the Southern District of New York, had written Liu last month saying he hoped Liu would allow prosecutors and the Department of Investigation to continue their work, "free from concern that even well-intentioned actions or announcements by third parties without access to all the facts might compromise their ongoing investigation."

Bharara was probably referring to the fact that the comptroller disclosed May 25 that the top consultant on Citytime, Gerard Denault, who worked for Science Applications, had been fired for timecard abuse. The feds announced Denault had been indicted two days later. It's possible that Denault's arrest for taking $5 million in kickbacks from a subcontractor was hastened by Liu's announcement.

In reply, Liu issued a statement today denying that he has interfered with the investigation. "We are committed to working cooperatively with all law enforcement agencies," he said.

So far, seven people have been arrested, and $28 million in stolen cash has been recovered. CityTime, an effort to automate the city's payroll, was initially estimated to cost $28 million. The number has ballooned to nearly $800 million, in part due to fraud and theft, in part due to changes in the specs, and in part because the city failed to properly oversee the project.

Liu has been out front in pointing out the flaws in the oversight of CityTime, and in lapses in oversight of technology projects by the Bloomberg administration.