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Federal and city investigators probing the massive, fraud-ridden CityTime payroll system are widening their focus from the private contractors who allegedly ripped off the project to staffers within the Bloomberg administration, The Post has learned.
Authorities are poring over e-mails and work records from the city’s Office of Payroll Administration. And prosecutors are pressuring those connected with the scandal to rat on government staffers tied to what has become, according to critics, the single biggest problem of Mayor Bloomberg’s two-plus terms in office.
“They want city officials,” said one person who’s been approached by federal and city authorities investigating CityTime. “They’re brutal, the pressure they’re putting on.”
Another source said authorities are focusing, for starters, on Joel Bondy, the former head of the Office of Payroll Administration who was forced to resign from his $205,180-a-year post in December.
“His activities are being very closely analyzed,” said the source, who has been briefed on the case. Bondy has not been charged and his attorney, Guy Petrillo, had no comment last night.
Bondy resigned after Bloomberg put him on unpaid leave following the arrest of four CityTime consultants and two of their relatives who were charged with ripping off $80 million by billing the city for hours that were never worked.
One of the those charged, Mark Mazer, is a former city employee who once worked with Bondy at the Administration for Children’s Services. Bondy also worked for one of the CityTime subcontractors, Spherion, before being hired as head of the city’s payroll operation.
It’s unclear who else is being targeted by the feds and the city’s Department of Investigation.
One former exec with the main CityTime contractor has already pleaded guilty, and nine people have been indicted so far.
An official familiar with the investigation said, “With a big case like that, [prosecutors and investigators] are going to work it hard and take it as high [in the government] as they can.”
Once hailed as a futuristic way to save money and crack down on payroll abuse, CityTime was supposed to cost taxpayers $63 million.
But that was a decade ago. The project’s total cost is now closer to $760 million and US Attorney Preet Bharara has said $600 million of that is tainted by the fraud and conspiracy that has marred the development of CityTime.
Contractors allegedly lied and vastly inflated their costs as delays and expenses piled up.
Bloomberg last week formally requested a $600 million refund from Science Applications International Corp., the Virginia-based company responsible for developing the system. The company’s stock yesterday closed down 80 cents, at $16.20.
Bloomberg spokesman Marc LaVorgna declined to comment on the direction of the investigation. Bharara’s office yesterday also had no comment.
Asked whether city officials are in the cross hairs, DOI spokeswoman Diane Struzzi said, “We won’t stop until everyone is held accountable, wherever they may be.”