Latest indictments open can of worms for Koch and N.Y.C.. Documents sprinkled with charges of `political patronage'

Although Mayor Edward I. Koch's name is not mentioned in any of the indictments coming out of various prosecutor's offices these days, the very deliberate underlining of political patronage in the growing corruption scandal must be causing the mayor much chagrin. In the past several days, racketeering indictments have been handed down by both federal and local prosecutors for corruption found in the city's Parking Violations Bureau (PVB). Charging bribery, extortion, and forgery, these indictments name some major city players.

And the question underlying the charges remains, how could Mayor Koch let such a vast game of political footsie go on under his own table?

At press conferences, the mayor declares his innocence and admits he is shocked at what was going on. He has vowed to clean things up, and has taken several moves to institute changes in the way city appointments are approved. Indeed, no one charges that Koch is involved in criminal activities.

But the very use of the phrase ``power of political patronage,'' which was liberally sprinkled through the indictment handed down by US Attorney Rudolph W. Giuliani Wednesday, casts the shadow of the scandal far beyond those accused of such indictable offenses as bribery or extortion.

At a press conference on the indictment, Mr. Giuliani, joined by Manhattan District Attorney Robert M. Morganthau and City Investigations Commissioner Kenneth Conboy, spoke of the need for changes in how the city, politics, and business mix.

``Too many people can unfortunately say with justification that business or politics as usual in New York means paying off,'' said Giuliani.

He quoted an 1835 speech by Vice-President John C. Calhoun: ``The very essence of a free government consists in considering offices as public trusts, bestowed for the good of the country and not for the benefit of an individual or a party.''

In effect, the growing scandal seems to imply, the mayor had let the PVB come under the control -- and to the benefit of -- former Queens Borough president Donald R. Manes and his political cronies. Mr. Manes committed suicide earlier this month.

In a press conference on Wednesday, Mr. Koch conceded that the scandal was major, but he also pointed out that many of the key players were in place before he become mayor.

As he has been prone to do with other city problems, the mayor is not at all shy about pointing to previous administrations.

Yesterday Bronx Democratic chairman Stanley M. Friedman and five business associates were indicted on charges of bribery, forgery, coercion, and other acts to win a $22.7 million contract from the city.

According to the indictment, Mr. Friedman was give majority shares in a company that would produce hand-held computers to be used by the PVB.

The indictment alleges that he would hold one-third of the shares each for Manes and Geoffrey Lindenauer while they agreed to push through Citisource, even though the company had no engineering staff and no actual product.

The shares were worth more than $250,000 to Manes, Lindenauer, and Friedman. The indictment also charges that Manes paid Lindenauer $57,000 in cash to further push the contract.

On Wednesday, two former city officials were indicted on federal charges for turning the city's Parking Violations Bureau into a racketeering enterprise that collected more than $542,000 in bribes and payoffs. Michael J. Lazar, a real-estate developer and former city transportation administrator, and Lester N. Shafran, who left his post as director of the parking bureau when the scandal broke two months ago.

They both pleaded not guilty yesterday.

Also named as unindicted coconspirators were Manes and Lindenauer, a key figure who pled guilty and agreed to cooperate with federal authorities in the investigation.

Both Mr. Lazar and Mr. Shafran have been active in Queens politics and were allies of Mr. Manes. Two other men were also named.

Lazar has been a major contributor to Democratic campaigns in New York, including those of Mayor Koch and Gov. Mario M. Cuomo. His dealings with state agencies are also under investigation, according to Giuliani.