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MBM scandal
The MBM scandal was an American political scandal of the 1970s which involved members of the Massachusetts Senate extorting money from McKee-Berger-Mansueto, Inc. (MBM), the consulting company supervising the construction of the University of Massachusetts Boston campus at Columbia Point.
On April 22, 1970, the Bureau of Building and Construction awarded the contract to supervise construction of the University of Massachusetts Boston's new campus at Columbia Point to MBM. Their fee was to be 1.53% of the approved budget for Phase I of the project, which was an estimated $2,295,000. The contract was approved by Commissioner of Administration and Finance Donald R. Dwight.
On February 8, 1971, Wendell Woodman, a writer whose State House column appeared in many suburban newspapers, released the first in a five-part series of articles that attacked MBM's contract as a "sweetheart deal". According to Woodman, the Bureau of Building and Construction (BBC) "never negotiated the contract in any way, and that the McKee-Berger proposal was accepted intact by the Commonwealth before the state had seen it...The contract indicates there was collusion between the BBC and McKee-Berger, and possibly conspiracy".
On February 11, Senator Joseph DiCarlo and Representatives Ralph Sirianni and William F. Hogan filed an order for the creation of a joint committee to investigate the circumstances surrounding the awarding of the contract to MBM.
On February 18, MBM President Gerald McKee and the firm's attorney, Endicott Peabody, met with DiCarlo. According to McKee and Peabody, DiCarlo told them he was going to use the investigation to embarrass Dwight (who by then had been elected Lieutenant Governor), whom he viewed as a potential opponent in a future gubernatorial election, and would not consider the case on its merits. Anthony Mansueto, one of the company's senior vice presidents, then sought the help of Senator James A. Kelly, Jr. On March 17 the two met in Palm Beach, Florida. According to Mansueto, Kelly told him that he had talked with DiCarlo and "For $100,000, MBM's problems could be solved". The company did not pay the money and chose to let the matter pass. On March 29, 1971, a joint legislative committee was formed. DiCarlo was named the Senate Chairman and Sirianni was named the House Chairman. Senators DiCarlo, George V. Kenneally Jr., and Robert Cawley and Representatives Sirianni, Paul Menton, J. Laurence Golden, J. Hilary Rockett, and James F. Hart were named to the committee. The committee held four hearings between May 5, 1971, and July 29, 1971. After the final hearing, McKee was afraid that his company would lose its contract. William Harding, MBM's head of sales, then talked to his friend, Senator Ronald MacKenzie, about the probable results of the investigation.
According to Harding, MacKenzie told him that a favorable committee report would cost between $30,000 and $40,000. McKee and Mansueto concluded that the only way for MBM to keep their contract would be to pay the money. Harding made the first payment on October 11. Because the company was having cash flow problems, the payment was only $5,000. After the payment was made, MacKenzie gave Harding a draft copy of the committee's report, which he gave to McKee. McKee found the report to be ambiguous and dictated a memo about the good work MBM had done on the project, which Harding delivered to MacKenzie for inclusion in the final report. The next month, the committee issued its report, half of which was McKee's memo. A second $5,000 payment was made by Harding on November 20. McKee made a $10,000 payment on January 20, 1972. Harding made the fourth payment ($10,000) on February 18 and Jack Thomas, head of MBM's Boston office, made the final payment (also $10,000) on May 12.
All of the payments were made to MacKenzie, several of which were made at a bar near MBM's Boston office. On July 6, DiCarlo and MacKenzie visited McKee in his New York City office. According to McKee, DiCarlo chastised him, saying that "They shouldn't have to chase MBM like creditors" and that the delayed payments had caused him "difficulty and embarrassment because he had to share them with others".
In the spring of 1975, Federal investigators were looking into corruption in Pennsylvania. While under interrogation by a Federal prosecutor during a grand jury, an MBM official was asked if he knew of any similar corruption in any other state. He replied that he was aware of corruption in Massachusetts. The testimony was then forwarded to the Federal Bureau of Investigation's Boston field office. Special Agent in Charge James O. Newpher assigned Agent Robert Sheenhan to the case, who investigated it in conjunction with U.S. Attorney James N. Gabriel.
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MBM scandal
The MBM scandal was an American political scandal of the 1970s which involved members of the Massachusetts Senate extorting money from McKee-Berger-Mansueto, Inc. (MBM), the consulting company supervising the construction of the University of Massachusetts Boston campus at Columbia Point.
On April 22, 1970, the Bureau of Building and Construction awarded the contract to supervise construction of the University of Massachusetts Boston's new campus at Columbia Point to MBM. Their fee was to be 1.53% of the approved budget for Phase I of the project, which was an estimated $2,295,000. The contract was approved by Commissioner of Administration and Finance Donald R. Dwight.
On February 8, 1971, Wendell Woodman, a writer whose State House column appeared in many suburban newspapers, released the first in a five-part series of articles that attacked MBM's contract as a "sweetheart deal". According to Woodman, the Bureau of Building and Construction (BBC) "never negotiated the contract in any way, and that the McKee-Berger proposal was accepted intact by the Commonwealth before the state had seen it...The contract indicates there was collusion between the BBC and McKee-Berger, and possibly conspiracy".
On February 11, Senator Joseph DiCarlo and Representatives Ralph Sirianni and William F. Hogan filed an order for the creation of a joint committee to investigate the circumstances surrounding the awarding of the contract to MBM.
On February 18, MBM President Gerald McKee and the firm's attorney, Endicott Peabody, met with DiCarlo. According to McKee and Peabody, DiCarlo told them he was going to use the investigation to embarrass Dwight (who by then had been elected Lieutenant Governor), whom he viewed as a potential opponent in a future gubernatorial election, and would not consider the case on its merits. Anthony Mansueto, one of the company's senior vice presidents, then sought the help of Senator James A. Kelly, Jr. On March 17 the two met in Palm Beach, Florida. According to Mansueto, Kelly told him that he had talked with DiCarlo and "For $100,000, MBM's problems could be solved". The company did not pay the money and chose to let the matter pass. On March 29, 1971, a joint legislative committee was formed. DiCarlo was named the Senate Chairman and Sirianni was named the House Chairman. Senators DiCarlo, George V. Kenneally Jr., and Robert Cawley and Representatives Sirianni, Paul Menton, J. Laurence Golden, J. Hilary Rockett, and James F. Hart were named to the committee. The committee held four hearings between May 5, 1971, and July 29, 1971. After the final hearing, McKee was afraid that his company would lose its contract. William Harding, MBM's head of sales, then talked to his friend, Senator Ronald MacKenzie, about the probable results of the investigation.
According to Harding, MacKenzie told him that a favorable committee report would cost between $30,000 and $40,000. McKee and Mansueto concluded that the only way for MBM to keep their contract would be to pay the money. Harding made the first payment on October 11. Because the company was having cash flow problems, the payment was only $5,000. After the payment was made, MacKenzie gave Harding a draft copy of the committee's report, which he gave to McKee. McKee found the report to be ambiguous and dictated a memo about the good work MBM had done on the project, which Harding delivered to MacKenzie for inclusion in the final report. The next month, the committee issued its report, half of which was McKee's memo. A second $5,000 payment was made by Harding on November 20. McKee made a $10,000 payment on January 20, 1972. Harding made the fourth payment ($10,000) on February 18 and Jack Thomas, head of MBM's Boston office, made the final payment (also $10,000) on May 12.
All of the payments were made to MacKenzie, several of which were made at a bar near MBM's Boston office. On July 6, DiCarlo and MacKenzie visited McKee in his New York City office. According to McKee, DiCarlo chastised him, saying that "They shouldn't have to chase MBM like creditors" and that the delayed payments had caused him "difficulty and embarrassment because he had to share them with others".
In the spring of 1975, Federal investigators were looking into corruption in Pennsylvania. While under interrogation by a Federal prosecutor during a grand jury, an MBM official was asked if he knew of any similar corruption in any other state. He replied that he was aware of corruption in Massachusetts. The testimony was then forwarded to the Federal Bureau of Investigation's Boston field office. Special Agent in Charge James O. Newpher assigned Agent Robert Sheenhan to the case, who investigated it in conjunction with U.S. Attorney James N. Gabriel.