DiMasi mum on Cognos inquiry

Rejects any link to the awarding of state contract

By Andrea Estes and Stephen Kurkjian
Globe Correspondent / December 18, 2008
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House Speaker Salvatore F. DiMasi refused yesterday to comment on a report that a federal grand jury is investigating the state's awarding of multimillion dollar contracts to computer software company Cognos.

"I had absolutely nothing to do with the awarding of that contract," he said, following a Beacon Hill press conference held to discuss a federal stimulus package.

When asked whether he had received a subpoena, he said, "No comment other than that," and left the room.

The Globe reported yesterday that US Attorney Michael J. Sullivan has convened a grand jury to investigate the state's awarding of a pair of multimillion dollar contracts to Cognos, which made large payments to close associates of DiMasi's as it was seeking state work.

The contracts were awarded by two state agencies, the Information Technology Division in 2007 and the state Department of Education in 2006.

Some state officials involved in the process said they believed that DiMasi wanted the contracts to go to Cognos.

A Cognos sales agent boasted to state officials that he was friends with DiMasi and could help persuade the Legislature to pay for the contracts.

And Richard Vitale, DiMasi's accountant and campaign treasurer, received payments totaling $600,000 from a Cognos sales agent, Joseph Lally, including a $500,000 payment on the same day the state wired money to Cognos for a $13 million statewide technology contract.

Richard Nicolazzo, a spokesman for the Boston accounting firm that Vitale helped establish, confirmed yesterday that the company had received a federal subpoena for some of Vitale's records.

He said the company, Vitale Caturano & Co., "is fully cooperating with and assisting the federal government" and understands that the firm is not a target of the investigation.

Last May, Vitale resigned from the firm, which he cofounded in 1978 and helped build into one of the largest in the country.

Vitale also received $100,000 from Lally in 2006, the same year that he gave DiMasi a third mortgage on his North End condominium. He has declined to say what he did to earn the money.

The Information Technology Division received one of several subpoenas issued in recent weeks for records relating to the contract, as did the state Education Department.

The launch of the federal grand jury probe comes as DiMasi courts House members to reelect him to another two-year term as speaker in January.

The speaker has consistently downplayed the threat the Cognos controversy poses and has said he has no plans to leave office.

The federal probe is one of several focused on the activities of DiMasi and his friends and associates.

A separate state grand jury is looking into financial ties between DiMasi, Vitale, and an association of ticket brokers that hired Vitale to help push a bill that deregulated their industry. The bill passed the House, but stalled in the Senate.

Inspector General Gregory Sullivan, who has been looking into both the $13 million technology contract and the $4.5 million education contract, discovered that Cognos and Lally paid $1.8 million to friends and associates of DiMasi, payments that were never reported to regulators.

The money went to Vitale, Cognos lobbyist Richard McDonough, and DiMasi's law associate, Steven Topazio.

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