Contracts benefit family

Abood

Todd Heywood/City Pulse

Some of these billings, totaling $4,753, were made using coding that shields the identity of the Abood Law Firm.

Additionally, Abood’s administrative assistant is his daughter, Nicole Malson, who is being paid at a rate of $55,000 a year.

Abood, who for more than a year has worked as a deputy and interim city attorney, was required by ethics provisions of the City Charter and the city’s ethics ordinance to disclose this financial conflict of interest within 10 days of his first day on the job, which was Feb. 1, 2015. He did not comply with this requirement, according to City Clerk Chris Swope.

It was only on April 29 of this year, a month after being named interim city attorney, that he filed documents acknowledging his ownership interest in the Abood Law Firm.

In a response Tuesday to questions about Abood, the Bernero administration acknowledged that the employment of Abood’s daughter was a conflict and gave him to the end of June to resolve it.

But the administration denied that Abood had a conflict of interest regarding the use of his family law firm or had failed to properly disclose information required by the ethics ordinance.

Concerned about Abood’s actions, City Council President Judi Brown Clarke is filing a complaint with the city’s Ethics Commission citing provisions requiring all employees to disclose financial interests that would be an actual or perceived conflict of interest.

That complaint will cite Abood’s self-disclosed interest in the law firm as well as his continuing employment of his daughter as his contracted administrative assistant.

Abood confirmed to the City Council on March 29 and again in a conversation with City Pulse on May 12 that he has employed and directly supervises his daughter, a violation of the city’s ethics policies. That contract expires June 30 at the end of the fiscal year.

Also, newly released documents from City Auditor Jim DeLine show that although Abood wasn’t named interim city attorney until March 29 of this year, the city backdated his pay to Jan. 9 to reflect the promotion. This cost the city an additional $6,380.

“As a Deputy City Attorney it was not a question I was asked,” Abood wrote in response to questions from City Pulse about his role in approving contracts with his law firm. “As Interim City Attorney I have not considered awarding a legal matter to which outside counsel would be required to the Abood Law Firm.”

On Dec. 16, 2015, city billing records show four payments totaling $4,753 to the Abood firm; a $75 payment was made to the firm on March 15, 2016.

Abood's daughter went to work for the City Attorney's Office on June 8 of last year. Abood said Tuesday she works full time but does not receive overtime.

He said hiring his daughter was not his decision. But the city’s website shows she reported to him both when he was deputy city attorney and now, as interim city attorney.

“I did not hire my daughter as a contract employee of the City, my predecessor did,” he wrote, referring to Janene McIntyre.

Randy Hannan, chief of staff to Lansing Mayor Virg Bernero, issued a statement by email Tuesday that said:

“Mayor Bernero understands that Mr. Abood’s interest in the Abood Law Firm is held in trust by his brother, Andrew, which is an accepted practice at all levels of government. He also understands that any income Mr. Abood has derived from the Abood Law Firm while serving as Deputy City Attorney/Interim City Attorney was earned prior to his employment by the city. During his tenure as Interim City Attorney, Mr. Abood has not engaged the Abood Law Firm for any matter requiring outside counsel and was not responsible for any such engagements prior to his appointment as interim. Contrary to your claim, Mr. Abood did not hire his daughter. Nonetheless, Mayor Bernero has directed him to resolve this conflict no later than the start of the new budget year on July 1. As Deputy City Attorney, Mr. Abood was not a reporting individual under the city’s ethics ordinance and therefore was not required to file a statement of financial interests in 2015. He did file a statement of financial interests in 2016 following his appointment as Interim City Attorney.”

However, Hannan is referring to only one provision of the ethics ordinance — which requires elected and top appointed officials, as well as members of city boards, to submit financial disclosure reports. The law and city policies also require any employee with a conflict to file such forms.

The ethics issues entangling Abood come as the administration is still grappling with controversy over its $160,000 settlement with McIntye, who resigned March 4.

Adding to the controversy are multiple issues related to the Michigan Freedom of Information Act. The city, ignoring legally required deadlines, has yet to produce documents requested under the law or even to respond to requests for them.

The city’s ethics policies are outlined in a 33-page document. Overall responsibility for oversight rests with the city attorney. The manual outlines the responsibilities for city employees, as well as appointed and elected officials to disclose ethical concerns, such as a family member or business in which an employee has a financial interest having a contract with the city. Such conflicts are to be disclosed in writing to the Ethics Commission within 10 days.

Swope said the only financial disclosure forms for Abood were filed on April 29. The ethics ordinance designates the city clerk as the record-keeper for the Ethics Commission.

Since becoming Lansing’s deputy city attorney, Joseph Abood has continued his 50 percent stake in the law firm he used to run with his brother, financial disclosure documents reveal.

While not actively working for the Abood Law Firm since being hired by the city, he has received payments in "excess of $2,500," his financial disclosure form showed.

“I retain an interest in the Abood Law Firm that is held in Trust by my brother Andrew,” he told City Pulse. “I retain a financial interest to the extent that I retained certain accounts receivable. My relationship to the firm has been disclosed in compliance with the City’s ethics requirements.”

Abood’s continued interest in The Abood Law Firm may violate the city’s voter-adopted Ethics Ordinance. That ordinance, according to the Ethics Manual for the City of Lansing, prohibits appointed and elected officials from using their position to “obtain financial gain” for themselves, their immediate family members, or businesses which the family or employee have an interest.

Brown Clarke said she was unaware of Abood’s stake in the outside law firm until City Pulse drew her attention to it.

“If he disclosed it to the Ethics Commission, wouldn’t you usually say it’s not in our best interest to send work to this firm because of a conflict of interest?” Brown Clarke asked.

She called the conflict inherent in the situation “poor business decisions.”

Abood may face a reappointment hearing before City Council on May 29, when his current appointment as interim city attorney expires. Brown Clarke said this conflict will impact the Council’s deliberations on whether to extend his term.

Since December, city records obtained by City Pulse show, Abood Law Firm has billed the city nearly $5,000 for legal work. This figure only represents billing sent directly to the city and does not reflect any legal billings that may have been filed with the city’s third party legal payment contractor.

The records, compiled by DeLine in April show the city was direct billed $23,269.35 for legal services by six legal entities. The billing was for Nov. 18, 2015, to April 7.

Three of the four billing entries for The Abood Law Firm are listed only as “Outside Counsel” and provide no details about what legal services were offered, or for what case. One entry, from March of this year — for $75 — is billed with the cryptic “ALF Re: BJO.”

Adding to Abood’s ethical issues woes is the fact that after he began employment in the Office of the City Attorney, he and McIntyre hired his daughter, Malson, to serve as a contract administrative assistant to both. Malson continues in her post, with Abood as her direct supervisor, despite assurances during his March confirmation hearings that this would change.

A payroll history produced by DeLine of Abood’s checks since January show that on March 25, he received a payroll check for $9,835. His biweekly pay up until that date was $3,455. After his appointment, his biweekly pay increased to $4,615. DeLine calculated that the March 25 check represented a back date in pay rate as interim city attorney to Jan. 9.

As chief deputy city attorney, one of Abood’s responsibilities was to fill in for the city attorney during absences, such as her nearly two-month absence on medical leave this year while she and the city sparred over her employment. She did not resign her post In effect, the city has now paid two individuals to carry out the position of Lansing City Attorney.

Hana Callaghan, director of government ethics for the Markkula Center for Applied Ethics at Santa Clara University in California said the situation with Abood raises a host of ethical concerns.

“It’s definitely a conflict of interest,” she said of Abood’s continued interest in his former law firm and the city contracts issued to it. “It’s a violation of the fiduciary duty to the public.”

She said this about more than perceptions and actual violations of ethics.

“First and foremost, if the public doesn’t trust government, government doesn’t work,” she said. “That’s why they’re stewards of the public trust.”

She said is essential public employees and elected officials avoid “even the appearance of impropriety.”