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Hults faces felony charges; probe's focus turns to supervisor's office

Publication: The East Hampton Press
  Jun 16, 2009 4:04 AM

By Stephen J. Kotz

Former East Hampton Town Budget Officer Ted Hults was arraigned on nine criminal charges, including seven felonies, before East Hampton Town Justice Lisa R. Rana on the morning of June 11. He is cooperating with investigators as the probe apparently focuses now on Town Supervisor Bill McGintee.

According to court documents, in sworn statements to investigators, Mr. Hults said both he and Mr. McGintee were aware of illegal transfers made from the Community Preservation Fund to the town’s general fund, despite the town attorney’s warning that such transfers would be illegal.

The charges stem from a year-long investigation of the town’s finances by Suffolk County District Attorney Thomas Spota’s Government Corruption Bureau.

All of the charges involve either the improper transfer of CPF money or the preparation of false or misleading documents related to the town’s efforts to borrow money. None of the charges allege that Mr. Hults embezzled any money or obtained any personal gain though his actions.

Mr. Hults, who had yet to hire his own lawyer, appeared in court represented by legal aid attorney Robert Coyle, as Christopher McPartland, the Government Corruption Bureau chief, listed the charges against him. He entered not guilty pleas to the misdemeanor charges but was allowed to abstain from entering pleas on the felony charges. He did not speak to reporters.

He was released on his own recognizance after Mr. McPartland told the judge that he was cooperating with the DA and is due to appear back in court on July 30.

“The people have a strong case,” said Mr. McPartland, citing two sworn confessions from Mr. Hults and extensive interviews with town officials. After the proceeding, Mr. McPartland said he expected others to be charged in the probe.

Although Mr. Hults’s statements implicate Mr. McGintee, no charges have been filed against the supervisor.

Mr. Hults and Mr. McGintee have been at the center of a scandal over the state of the town’s finances. East Hampton is likely to face a deficit of at least $18 million by the end of this year, even though the town had a surplus of about $11 million when Mr. McGintee was sworn into office in 2004.

At a press conference outlining the investigation and announcing the results of the New York State Comptroller’s audit of the town’s Community Preservation Fund on Thursday afternoon, District Attorney Thomas Spota said his office was continuing to investigate Mr. McGintee.

“I am absolutely concerned about the conduct and actions of the supervisor,” he said. “Our investigation is continuing and that’s where I’ll leave it.”

“I don’t think it will be too long,” Mr. Spota replied when asked when officials would announce whether or not they planned to make additional arrests. The district attorney would not comment on whether other town officials besides Mr. Hults and Mr. McGintee were being investigated, although he did say that it appears that the improprieties took place without the knowledge of the members of the Town Board.

Mr. Hults was charged with a felony count of defrauding the government for transferring a total of approximately $8 million from the town’s Community Preservation Fund to the general fund beginning in December 2006 when the town could not meet its payroll.

He was also charged with a total of six felony counts for securities fraud, filing false instruments and falsifying business records related to the town’s effort to borrow a total of $12.3 million by issuing bonds in June and August 2007. According to the complaint, Mr. Hults made at least two “material misrepresentations” in filing documents required to issue bond anticipation notes, including that then Town Attorney Laura Molinari had reviewed the documents when in fact she had not. Ms. Molinari later resigned over the matter.

Mr. Hults also allegedly stated that the town had a surplus of $171,573 in its general fund, when it actually had a deficit of more than $900,000 at the time it was trying to borrow the money.

He also faces two misdemeanor charges of official misconduct, one related to the CPF transfers and one related to the town’s bond effort to float bonds.

DA spokesman Bob Clifford on Thursday afternoon said Mr. Hults could face from 16 months to four years for each of the felony charges and up to one year for each of the misdemeanor charges.

Reporter Beth Young contributed to this story.

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Finally!
By Waincott Resident (38), Wainscott on Jun 11, 09 1:25 PM
Oh Teddy......what have you done. Gone are the days of my little innocent Teddy and our adventures in Three Mile Harbor ...remember our movie date? Do they serve caffine free diet coke in jail? Maybe I can put some money on your books. I hope this makes you smile and wonder....:0)
By Kid755 (1), Wainscott on Jun 11, 09 1:38 PM
Well, well, well...are we at all surprised? And what about the "big man"?? When the canary sings, that arrogant cat shall fry! I guess the Independent got it right from the beginning...and yes, Mike H, where were the other papers?
By nauti lady (21), Sag Harbor on Jun 11, 09 2:11 PM
One down, one to go.
By Rich Morey (73), Brooklyn on Jun 11, 09 2:12 PM
what a sad sad picture..two Springs schoolmates....lets get the focus on the real criminal now..at least he isn't a true Bonacker...
By gansetteer (125), East Hampton on Jun 11, 09 2:49 PM
Let's all remember come November that the DEMOCRATIC party stood by and defended these criminals. This Independent will NEVER vote for a Democrat in East Hampton Town again unless the current party heads are replaced!
By disappointed (50), wainscott on Jun 11, 09 3:10 PM
Well, you could make a movie and call it All The Supervisor's Men. Reminds me of Aug 1974 and the two reporters from the Washington Post. Only this time it was the Indy who broke the case. Oh, and I should think some resignations would have to be forthcoming shortly.
By BruceB (120), Sag Harbor on Jun 11, 09 3:17 PM
Hurry lets sell some more property before its too late
By deKooning (78), southampton on Jun 11, 09 3:53 PM
I do not understand why everyone is so happy to see Ted Hults being arrested. Did he steal anyone's money...no. Did he steal anyone's job...no. He followed orders and did what he thought was right, even if misguided. Anyone who knows Ted Hults knows he is one of the kindest decent human beings. So easy to throw stones maybe not as easy to accept the fact no one in East Hampton was willing or is willing to sacrifice to keep the town afloat. Having protest because you doctor copays might go up $5 ...more
By jekgbs (35), East Hampton on Jun 11, 09 4:18 PM
The following orders defense will not work. He should have known what he was doing was wrong and he must/will pay a price. My guess is the price is going to be his testimony against the supervisor and the town board. They are all respnsible. I can't wait to see how The East Hampton Star and all of their devoted letter writers spin this to make it Jay Schneiderman's fault.
By Mary Anne (1), East Hampton on Jun 11, 09 4:35 PM
one down and ONE to go???!!! the d.a. is just warming up!i predict alot of new "bracelets" in town hall in the next few weeks.
By montauk resident (41), montauk on Jun 11, 09 4:55 PM
Its's time for the Suffolk DA to look HARD at all these small towns
By sjd (420), Westhampton Beach on Jun 11, 09 5:18 PM
Karma is a beautiful thing. The town should have never took Rian Whites hot dog
man.
By ride the truth wave (125), southampton on Jun 11, 09 6:39 PM
In every scandal there's always a fall guy. Unfortunately Ted is this guy. I can't say for sure whether he "knew" all the facts, but the facts are: the public elected Bill and now we are "paying" for it. Let's fix what's wrong and bring Wilkinson into power.
By julie (2), East Hampton on Jun 11, 09 9:25 PM
"He followed orders and did what he thought was right, even if misguided."

If I recall my history, that didn't work as a defense at the Nuremberg Trials!

The worst thing about this business is that the Independent will be blowing smoke up their own backsides about their role in this, well into the next decade!!
By Frank Wheeler (1185), Northampton on Jun 11, 09 10:12 PM
I don't know all the circumstances and background here. But as a career bureaucrat involved in budgeting you are sometimes called upon to do things you know are not correct. A lot of pressure can be placed on you. I've enjoyed the luxury of civil service protection so in my case I've able to say no knowing I could not be fired and I don't know if that is the case here. Let the guy have his day in court; there are whistle blowing laws now that sometimes protect those left exposed - and sometimes ...more
By North of Highway (273), Westhampton Beach on Jun 11, 09 10:39 PM
Let's just get this over with and get on to a new administration. The last thing EH needs now is a lion show. We need leadership -- solid, steady and focused on righting the ship. Bring Bill W and Dom S in, keep Janet V. and let's get this train back on its tracks.
By marytango (5), East Hampton on Jun 11, 09 11:40 PM
This comment has been removed because it is a duplicate, off-topic or contains inappropriate content.
By bonacspring (5), east hampton on Jun 12, 09 7:40 AM
This is such a sad day. Again, Ted is an honest, hard working person who obviously and clearly got pulled into something. Ted would NEVER, and I repeat NEVER commit a crime knowingly. Anyone who knows Ted would clearly know this to be true. He's as honest as they come. To see this picture on the front of the paper is a sad day. I have a feeling he is the "fall guy" for this event. Ted, you have a lot of support and people who are rallying for you. Just remember that. What bothers me is ...more
By Amahalo (20), East Hampton on Jun 12, 09 8:08 AM
This is a sad day for East Hampton, not Ted Hults. Ted ABSOLUTELY committed a crime knowingly as Laura Molinari expressly told him and Bill that it would be illegal to use CPF to cover shortfalls in the budget. They did it anyway. Ted ABSOLUTELY committed a crime knowingly when he hoodwinked potential investors by lying about the financial health of this town. The "group" that is happy about this is the entire town which has to foot the bill for all the incompetence and malfeasance.
By Gabrielle Brady (9), East Hampton on Jun 12, 09 10:03 AM
1 member liked this comment
Gabrielle, were you in on those conversations? I am part of this town and I am not happy. What is sad is that you want to see our town brought to such a low level. You say Ted "absolutely" committed a crime "knowingly." That's pretty strong words coming from someone who, like everyone, has only read what the media has advised. And please, don't infer your thoughts across the whole town, as there are a lot of people who are very sad for Ted - again, those who actually know him, which you obviously ...more
By Amahalo (20), East Hampton on Jun 12, 09 10:44 AM
This comment has been removed because it is a duplicate, off-topic or contains inappropriate content.
Oct 30, 10 4:57 PM appended by Caring Mom
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By Caring Mom (6), Wainscott on Oct 6, 10 4:57 PM
First of all I would like to ask who you are Amahalo? In order to engage in effective and civilized discourse people should know who they are talking to. The reason we know that Ted and Bill were warned is that he has already told the DA that is the case. The strong words are coming from the DA and State Comptroller, not me. It was stated in court that he has already signed two confessions. You should read the press releases from both that would clearly enlighten you to the facts. And who ...more
By Gabrielle Brady (9), East Hampton on Jun 12, 09 11:20 AM
1 member liked this comment
This comment has been removed because it is a duplicate, off-topic or contains inappropriate content.
Oct 30, 10 5:03 PM appended by Caring Mom
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By Caring Mom (6), Wainscott on Oct 6, 10 5:03 PM
This comment has been removed because it is a duplicate, off-topic or contains inappropriate content.
By Caring Mom (6), Wainscott on Apr 8, 14 1:58 PM
You are assuming that Laura Molinari is 100% correct in her interpertation of the law. What if she is wrong or what if there are different view points. That is why we have a legal system that allows everyone their moment in court. Ted did not have an attorney with him so who knows what he signed and why. The only ones that benefitted were those who did not lose their jobs with the budget shortfalls. I'm not defending illegal or unethical actions. But truth is this adminstartion has saved jobs. Go ...more
By jekgbs (35), East Hampton on Jun 12, 09 12:58 PM
North of Highway says:

Last comment - what does this mean for Southampton Town?? Deja vou?

Please, don't be silly. In Southampton, we would have found a spot for him. As in the case of the past immediate Comptroller,Kabot, Throne-Holst, Pope, and Graboski found a postion that never existed before for a mere $100,000.00 per year, plus benifits and Civil Service protection. Things are much more efficient here, no messy trial, no firings just a nice fat paycheck.
By Terry (380), Southampton on Jun 12, 09 1:06 PM
I agree with "North of Highway" about the Town of Sh. The absorbtion Brautian, the retention of Blowes, the hiring of consultants to obscure and cover the paths to the mess are typical of the way incompetent non-entitites work. Will we ever see criminal investigation and prosecution of SH money shifters? They have operated with impunity for years, confident if they did get called on to explain their actions they could retreat to the position of their ignorance and stupidity. All these people ...more
By Phanex (70), Southampton on Jun 12, 09 2:53 PM
I'm still tryihg to understand how the Hook School House is real property. Another illegal transfer of CPF monies. Anyway here's a link to the office of the State Comptroller

http://www.osc.state.ny.us/press/releases/june09/061109a.htm


By John F Talmage (3), East Hampton on Jun 12, 09 3:02 PM
Best of luck in upstate prison, they'll need it.
By slamminsammy (104), Hampton Bays on Jun 12, 09 3:54 PM
OK folks, understand way too many people work for the town with way too many benifits, with way too many rich contracts at way too high an hourly rate. The frivolous lawsuits over the years, the new vehicle fleets, top of the line models, with ridiculous sized institutions of fire and police stations. Not to mention the ridiculous social costs of illegals and out of control spending on educational resources. What's Amagansett up to now $75,000.00 per student.
This economy will force austerity.
Aug 16, 11 6:45 PM appended by BlackDog
11
By BlackDog (47), East Hampton on Jun 12, 09 6:45 PM
Gabrielle, I have no trouble saying whom I am. My name is Ann Walsh. I used to work with Ted at Springs School and have known him for over 17 years now. Just because people use a name on blogs, doesn't mean they don't want to reveal themselves. I am Ann, I know Ted and Ted is not a criminal. I say that openly and honestly. You claim the "group" that is happy for this is the entire town of EH. Well, I'm not happy and I know an awful lot of people who are not happy. You know why? A decent ...more
By Amahalo (20), East Hampton on Jun 12, 09 11:09 PM
It's sad, you look at Mr Hult's face and you see a lamb or deer in the headlights. If I was on the town board I would put my head down in shame. You're only as good as those around you. It's simply sad, the poor bloke probably thought he had no other choice to make payroll. I told McGintee two years ago, Bill you're never be a local, they'll fry you in the pan. Could see the look of fear in his wife's eyes. It's not like these guys enriched themselves. Budgets just got fatter and fatter every ...more
By BlackDog (47), East Hampton on Jun 12, 09 11:21 PM
It's sad, you look at Mr Hult's face and you see a lamb or deer in the headlights. If I was on the town board I would put my head down in shame. You're only as good as those around you. It's simply sad, the poor bloke probably thought he had no other choice to make payroll. I told McGintee two years ago, Bill you're never be a local, they'll fry you in the pan. Could see the look of fear in his wife's eyes. It's not like these guys enriched themselves. Budgets just got fatter and fatter every ...more
By BlackDog (47), East Hampton on Jun 12, 09 11:21 PM
Just wondering why all of you pepole hate the East Hampton Independent?
Fortuanately I do not live in the town of EH and sure am glad as I would not want my taxes to go up 18%. The way I see it the Independent is the only true
paper around here. It reports the news, it is not persuaded by any polictial organizations. They get the scoop report on it and that's that. As I said once before I don't think half of you have ever gone west of the canal. I personally do not know any of these ...more
By J. Totta (62), Sag Harbor on Jun 13, 09 10:41 AM
Here comes the plea bargain. Watch.
By Undertow (64), Southampton on Jun 13, 09 7:32 PM
According to Dr. Dominick Annacone,the interim superintendent at Springs school 15 years ago,Peter Lisi had a secretary named Ann Nassuer Walsh (Amaholo). Dr Annacone stated she "was like a spy, the board had to fire her." Independent 04/23/08 Hults' reign as budget officer at the school was marked by incompetence and allegations of credit card abuse. Yes, Peter Lisi and Ted Hults were fired and so were you. So don't hide under your married name. Defend your friend if you want to but be up ...more
By bayview (85), Southampton on Jun 15, 09 1:06 PM
This comment has been removed because it is a duplicate, off-topic or contains inappropriate content.
Oct 30, 10 5:05 PM appended by Caring Mom
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By Caring Mom (6), Wainscott on Oct 6, 10 5:05 PM
This comment has been removed because it is a duplicate, off-topic or contains inappropriate content.
By Caring Mom (6), Wainscott on Apr 8, 14 1:55 PM
This comment has been removed because it is a duplicate, off-topic or contains inappropriate content.
By pinga (90), hamptonbays on Jun 15, 09 8:30 PM
I'm not hiding. Dr. Dominic Annacone hid behind his illegal activity (yes, giving out junior high school grades BY NAME, by SCORE and indicating whether a child was special ed or not was ILLEGAL under New York State Law- if you were a parent, would you want that information freely floating around?) by removing those who knew of such activity. Peter Lisi wasn't fired - he resigned. It's on record. I resigned at an executive session - notably by force of Dr. Annacone who was not happy with the ...more
By Amahalo (20), East Hampton on Jun 16, 09 1:14 PM
By the way, bayview, you seem to hide even more - under a fake ID name. So, come forward and identify yourself and yourmany years of experience in education. Are you Dr. Annacone, a/k/a bayview? Your quote from one of your very many postings below:

"Having had many years of experience in education, I believe and agree with hamptonite."
By Amahalo (20), East Hampton on Jun 16, 09 1:15 PM
I SAW BILL AT WORK TODAY SHUFFLING AROUND ALOT OF PAPERS HMMMMMM
By pinga (90), hamptonbays on Jun 17, 09 8:17 PM
Not true at all Blue Sky ("whoever you are") You seem to go by many names. By the way, how do you personally know whether Dr. Annacone blogs or not? And absolutely untrue statements indeed. Also, I do know Ed and I stand by him. As far as all doey eyed, that's a good one! Hmmm. However, I never have had interest in married men - it goes against my religious beliefs. So I take that as a true insult in so many ways.

Also, have you ever considered whether your "friend" Dr. Annacone ...more
By Amahalo (20), East Hampton on Jun 22, 09 12:51 PM
This comment has been removed because it is a duplicate, off-topic or contains inappropriate content.
Oct 30, 10 5:12 PM appended by Caring Mom
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By Caring Mom (6), Wainscott on Oct 6, 10 5:12 PM
I hope the DA will make his next stop Southampton Town Hall and follow the trail where it leads,,and bring his handcuffs with him
By Tianard (6), Hampton Bays on Jun 22, 09 4:50 PM
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