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Rochester

Key Player in County LDC Probe Arrested

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Rochester: Key Player in County LDC Probe Arrested
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Dan Lynch, a former sales executive with Siemens Building Technologies and current president of Treadstone Development Corporation, pleaded not guilty in court on Tuesday in front of Judge Noonan.

"We made arrangements with the Attorney General's Office to turn Dan in," said Lynch's attorney, Michael Schiano.

Lynch was charged with one county of grand larceny and two counts of falsification of business records.

"My client has plead not guilty and we are looking forward to challenging the evidence in this case," said Michael Schiano.

Prosecutors say the case dates back to 2008. Upstate Telecommunications Corporations entered into a contract with Monroe County in 2007, known as the copier contract, to replace the county's copier system and provide management services.

According to the indictment, the non-profit, UTC, then contracted with Toshiba Business Solutions and Siemens Business Technologies on the projects.

In 2008, when the Senior PGA Championship was held at Oak Hill, the price of a chalet package was 100 thousand dollars. The indictment states that during this time, Lynch and an unknown individual agreed that Toshiba and Siemens would share the cost of a tent for the tournament, but since Lynch could not use Siemens funds for that matter, they would need to find another way.

Prosecutors say the two created false invoices showing a contract between Siemens and Toshiba for the design, development and management of the copier project that never existed, since the two already had a contract directly with UTC. The indictment states Siemens then paid Toshiba $75,000 for work related to the project, which was used by Toshiba, for the tent at the PGA.

Lynch's lawyer says these accusations are not true.

"That's what they are claiming. There is an issue that they claim that was done somehow fraudulently, but we are denying those allegations," said Schiano.

In a statement, Attorney General Eric Scheiderman said:

"My office will not tolerate theft of taxpayer dollars, whether by a public official, or by a contractor for a publicly funded entity. Those who scheme to steal from New York taxpayers will be held accountable."

State Comptroller Tom DiNapoli has questioned the use of local development corporations in Monroe County in an audit in 2012. On Tuesday he said in a statement:

"As my office has found in audit after audit – including one of the Upstate Telecommunications Corp. – LDC's that operate outside the public eye routinely abuse taxpayer dollars and must be subject to independent review."

Lynch was released on his own recognizance and is due back in court on Dec. 18. His lawyer says there may be more charges to come.

"It's anticipated there is going to be more charges filed against other individuals in the next week or two," said Schiano.

A county spokesman says Dan Lynch was also involved with an LDC contract for the county's public safety and security systems and services. That 20-year contract is worth $212 million.

Statement from Monroe County

“An officer of a private company that serves as a sub-contractor for a public Local Development Corporation was today indicted on criminal charges. This comes as the result of an investigation in which Monroe County continues to cooperate. The County is now working closely with respected former State Attorney General and U.S. Attorney Dennis Vacco to explore all options to safeguard the continuity of our technology and public safety communications infrastructure. We will continue to do everything in our power to protect the continuity of updated communications technologies for First Responders while making whatever changes are deemed necessary to ensure the efficient and ethical handling of taxpayer dollars.”

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