Lame-duck director produces financial forms but ICA won't certify accuracy
The lame-duck director of a state-created authority overseeing Pittsburgh's finances has produced five years of annual financial disclosure forms that he was required to have sent to the State Ethics Commission, but even the agency won't say whether they're real.
Matthew H. Haverstick, special counsel to the Pittsburgh Intergovernmental Cooperation Authority, informed the Tribune-Review by letter that the ICA and its lawyers “make no representation as to the accuracy or completeness” of the five Statements of Financial Interests produced this week by outgoing executive director Henry Sciortino's attorneys.
Ethics Commission Director Robert Caruso told the Trib on Thursday that he had begun a civil “enforcement action” on Sciortino for failing to file his disclosure forms during the past five years — as far back as the statute of limitations allows.
Sciortino also is the apparent target of a joint task force composed of the Allegheny County District Attorney's Office, the Pennsylvania Auditor General, the state Attorney General and the FBI. On April 20, county detectives raided the ICA's Downtown headquarters, carting off dozens of boxes.
In their search warrant affidavits, investigators said the probe included determining whether Sciortino intentionally failed to file mandatory annual financial disclosure forms with the Ethics Commission for the past 10 years in an effort to conceal his financial problems.
Authorities began the investigation after the Tribune-Review revealed that Sciortino, tasked with keeping Pittsburgh from slipping into bankruptcy, had himself sought federal bankruptcy protection in 2011-12 after being accused in court by a former business partner of running a string of sham companies out of his West Chester home to hide more than $700,000 in assets. The Trib also revealed the mass destruction or loss of many ICA financial records and invoices, and that Sciortino had apparently not filed a financial interest statement with the Ethics Commission since 2005.
Sciortino did not return calls seeking comment. He insisted in an April 6 email to state lawmakers that he annually filed mandatory disclosure forms with the state.
Caruso confirmed that Ethics Commission records show Sciortino filed his 2005 financial disclosure form but never sent in any others for 10 years.
After the Trib asked in March about Sciortino's forms, the commission sent a “notice of non-compliance” to Sciortino at ICA headquarters. That letter went unclaimed and was returned to Harrisburg. The Commission then sent a certified letter to Sciortino's home telling him that he had 20 days to comply with the law.
Caruso estimated that Sciortino has about 10 more days to send the commission his financial disclosure forms. The civil penalty for failing to file is $250 per year, but prosecutors could file misdemeanor criminal charges against him if investigators conclude Sciortino acted intentionally.
Caruso told the Trib that he consulted with the district attorney's detectives about their probe.
Four of the documents received by Haverstick, copies of which were turned over to the Trib under a state Right-to-Know Law request, were dated between 2012 and 2015 and cover Sciortino's outside employment, business interests and creditors from 2011 through 2014.
All were faxed April 26 from a telephone number tied to Sciortino's home, copied by his Pittsburgh law firm, then emailed to Haverstick. A fifth document dated April 27 covers 2015. It has no fax time stamp and was provided to Haverstick in a separate file by Devin M. Misour, an attorney with Sciortino's legal team at the Downtown firm Farrell & Reisinger.
Attorney Tom Farrell, another member of the legal team, declined to comment.
According to Caruso, Sciortino should have sent original copies of the disclosure forms to the Ethics Commission and the ICA would retain copies for public inspection.
Haverstick said the ICA has been unable to find original or paper copies at the agency and only has what Sciortino's attorneys recently provided. ICA board treasurer Michael Danovitz said he has never seen a copy of Sciortino's disclosure forms and that the director failed to produce them when Danovitz and the rest of the board requested that he do so in April.
“I've never seen any of them, except for my own, which I file annually,” Danovitz said.
In a written request, the Trib sought all of Sciortino's filings going back to 2005. But Sciortino — who also is the ICA's designated records officer — never responded to the requests.
Caruso, who joined the Ethics Commission in 1982, said he “can't remember even one lost form” by his agency. He told the Trib that a financial disclosure form that arrives in the morning at the commission usually will be date-stamped, scanned and posted on the state website within a day.
“To lose one form over 10 years? OK, maybe. But every year for 10 years? Never happened. I'd strongly dispute anyone who would say that it could happen,” he said.
The Ethics Commission required Sciortino to detail on his disclosure forms all creditors owed more than $6,500 — except first and second mortgages on his properties — and identify all outside employment, earnings and business interests.
His forms list connections to only two outside enterprises: a Chester County charity where he volunteers and Capitol Ideas, Inc., a consulting firm he founded in 2008.
In 2010 court filings by a former business partner — who'd won a $717,000 judgment against Sciortino four years earlier — other Sciortino-controlled entities were uncovered, including Access LLC; Double M. Ventures; H.V Sciortino Holdings; Independent Business Services: Triad Capital Advisors; and Union Financial Services.
Later that year, Sciortino's own court documents named Cambridge Investment Research, another West Chester brokerage he controlled.
According to the Pennsylvania Department of State, six of the firms are active but none is named in the Ethics Commission forms Sciortino produced for 2011 to today.
On his disclosure form covering 2011, Sciortino checked the box for “no creditors,” writing “prior year bankruptcy” next to it.
Caruso said Sciortino's brief mention of a bankruptcy was not good enough. The law requires him to itemize all significant creditors.
Although Sciortino filed for bankruptcy on Sept. 6, 2010, his case was not closed until June 7, 2011, a week after he was discharged by the trustee. Sciortino's state disclosure forms fail to mesh with federal court filings in his bankruptcy case, a Trib analysis revealed.
For example, Sciortino's 2011 disclosure paperwork for the Ethics Commission does not list Honda, the car company to which he owed $10,527 in late 2010; the hundreds of thousands of dollars due to his ex-business partner's firm, Fairmount Capital; or $296,890 for Siana, Bellwoar & McAndre and $40,548 owed to Thomas Myers, a pair of legal firms in Chester County.
Also missing: $62,000 due to Reed Smith, the Pittsburgh firm that doubled as the ICA's legal counsel in 2011.
Sciortino's bankruptcy filings mentioned other creditors but failed to indicate whether he owed each of them at least $6,500, which is the Ethics Commission reporting threshold.
They include Recovery Management Systems Corporation, GE Bank and American Express, as well as the Internal Revenue Service, the state Department of Revenue, the Bankruptcy Department of the City of Philadelphia and East Goshen Township's tax collector.
Carl Prine is a Tribune-Review investigative reporter.