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Former House Republican Chief of Staff Sentenced to Year and a Day in Kickback Scheme

by | Aug 27, 2015 2:35pm
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Posted to: Campaign Finance, Courts, Election Policy, Law Enforcement, State Capitol, East Hampton

Christine Stuart photo

George Gallo

(Updated 3:44 p.m.) Former House Republican Chief of Staff George Gallo was sentenced to a year and a day in federal prison Thursday in federal court in Hartford for steering Republican candidates to a direct mail company in Florida in exchange for kickbacks.

The federal government told the court that from 2008 to December 2013, Direct Mail Systems Inc. of Clearwater, Fla. paid Gallo, of East Hampton, $117,617 in exchange for steering candidates to their firm.

Federal prosecutors asked the court to sentence Gallo, a first-time offender, to 15 months. But although U.S. District Court Judge Vanessa L. Bryant did sentence Gallo to about five months less than the federal government requested, she said she imposed prison time to stem the tide of political corruption in Connecticut. She said Gallo only offered a “tepid” level of responsibility for his actions.

At the time of his arrest, Gallo was working for former House Minority Leader Lawrence Cafero. In April, during his arraignment and subsequent guilty plea, Gallo told Bryant that he had failed to disclose his previous financial relationship with Direct Mail Systems when he recommended them to candidates, including his boss.

Gallo also said that he had chosen not to reveal the illegal 10-percent commission he was getting from Direct Mail Systems for steering business, “because the House Republican leader would not have allowed that.”

According to court documents, Cafero directly confronted Gallo about receiving vendor compensation in September 2012 and Gallo lied to him, knowing Cafero “would end any such arrangement.”

Since 2008, Connecticut Republican candidates, Republican Town Committees, PACs, and the Republican House Campaign Committee spent nearly $2 million with Direct Mail Systems, according to State Election Enforcement Commission filings.

As chief of staff for the House Republicans, Gallo also was in charge of the House Republican Campaign Committee apparatus where he was in the unique position to recommend campaign vendors to candidates.

Gallo, who also headed the state Republican Party between 2005 and 2007, became familiar with Direct Mail Systems in that capacity and saw an opportunity to give them more business with the implementation of the Citizens Election Program. The program allows candidates to raise small contributions in order to get a state grant that’s about four times the amount they raised.

Gallo resigned his position in February 2014 after being mentioned as a person of interest in the federal investigation. He told the court that he is not currently employed but he is the full-time caregiver for his wife, who has breast cancer.

Gallo’s attorney, Hubert Santos, asked Bryant for “mercy,” suggesting home confinement so that Gallo could care for his wife.

Lisa Gallo, who is an executive secretary for the state Auditors of Public Accounts, tearfully described her journey through cancer treatments and how her husband has been there for her both physically and emotionally.

She said her husband is a “generous, thoughtful and kind man” who has tried live by the rules “but made a mistake.” She said her husband has suffered in his own personal prison for that mistake.

“He beats himself up about it every minute of every day,” Gallo told Bryant.

She said she can no longer lift her arm and can no longer drive long distances because of fatigue. She said her husband is her sole caregiver and drives her to her doctor appointments in New York and does all the cooking and cleaning around the house.

“What if cancer returns?” she asked the court. “I am a cancer survivor, but I am not free.”

Bryant said the circumstances are “unfortunate, [and] sad, but they are not extraordinary.”

Bryant said Mr. Gallo’s words did not ring true when he said he did not know what he was doing was a crime.

Gallo told the court he lied to Cafero about the kickback scheme when Cafero asked if he was getting paid by the preferred vendor because he was afraid of losing his job.

“I thought as long as I reported it on my IRS form I was ok,” Gallo said. “. . . I realize now I was mistaken and I was wrong.”

He told Bryant he regrets his actions and any harm it may have caused to anyone.

None of the victims — the candidates Gallo steered to the direct mail company — spoke at the sentencing. U.S. Attorney Christopher Mattei said they reached out to all the victims to let them know they were allowed to speak at the sentencing.

He said they did receive one written statement from an unnamed candidate for the General Assembly, who wrote in a letter that he did not feel Gallo’s actions impacted them.

But Bryant said this is not a victimless crime.

“The victims of the crime are the citizens of the state of Connecticut, as well as the individuals whose campaign coffers were pilfered,” Bryant said. “No remorse has been expressed for them.”

She said the crime “was committed out of greed” and pointed out that Gallo’s $150,000 salary from the House Republican Caucus could have been included in the calculation for restitution, but it wasn’t.

Gallo was given some leniency in the amount of time he has to report to prison to help his father in Florida move to an assisted living facility and set up a schedule of caregivers for his wife. He will have to surrender on Nov. 30.

Gallo requested to serve his time at Otisville, New York or at the federal prison in Danbury.

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