The following is from the Wall Street Journal:

Attorneys for the political operative accused of stealing roughly $1.1 million from Mayor Michael Bloomberg allege in court papers filed Wednesday that the mayor may have violated election laws and tried to “hide” the money that prosecutors claim was stolen.

The attorneys also accuse Manhattan District Attorney Cy Vance’s office of “serious misconduct,” claiming prosecutors violated a written agreement they had with the defendant, John Haggerty, and attempted to “trick or intimidate” Mr. Haggerty’s wife into revealing communications protected by marital privilege.

Howard Wolfson, a top mayoral aide, rejected the attorneys’ allegations. Mr. Vance has cleared Mr. Bloomberg of any criminal wrongdoing in the case; state election officials and city campaign-finance officials are examining whether the mayor violated any civil laws.

Erin Duggan, a spokeswoman for the district attorney, said the allegations “are without merit, and we will respond in detail in court.”

The allegations mark the latest round of recriminations in the high-profile case that has raised questions about the transparency of Mr. Bloomberg’s spending in his 2009 re-election campaign.

In June, Mr. Vance unveiled an indictment accusing Mr. Haggerty of duping Mr. Bloomberg into spending about $1.1 million on an Election Day ballot security and poll-watching operation. Mr. Haggerty allegedly used the money to buy a house.

The funds, from the mayor’s personal fortune, were funneled to Mr. Haggerty, a Queens Republican and a volunteer on the mayor’s campaign, through the New York State Independence Party. The party has not been charged with a crime.

In the new court papers, Mr. Haggerty’s attorneys claim the mayor’s campaign “intentionally chose the least transparent way possible to conduct ballot security….It was Mr. Bloomberg who chose to hide payments, not Mr. Haggerty.”

Mr. Haggerty’s attorneys suggested the district attorney’s office should “commence an investigation immediately” into the possibility that the mayor violated laws by transferring personal funds to the Independence Party for the direct purpose of helping his campaign with a ballot-security operation. If Mr. Bloomberg “made the contribution directing how it should be spent, he would be in violation of both the New York State Election Law and the New York City Campaign finance Law,” Mr. Haggerty’s attorneys allege.

State law prohibits contributions in excess of $94,200 to a state party from being used to promote a candidate.

City law requires specific expenditures made on behalf of Mr. Bloomberg’s campaign be reported, and these expenditures were not reported by the mayor.

In the court papers, the attorneys also accuse Mr. Vance’s office of prosecutorial misconduct.

In October, the district attorney’s office alleged in a court filing that Mr. Haggerty admitted to prosecutors that he “lied” to and “misled” the mayor’s campaign in order to conceal his intention to pocket the money. But Mr. Haggerty’s attorneys allege the prosecution violated an agreement with their client concerning his decision to speak to prosecutors. In addition, the prosecutors “mischaracterized what he in fact” told them, the attorneys said.

In an odd twist, the attorneys also claim that prosecutors contacted Mr. Haggerty’s wife on two occasions to entice her to provide incriminating evidence against her husband. The lead prosecutor told Mr. Haggerty’s wife “sensitive details about her relationship with her husband in what she perceived as an attempt to trick her into blurting out confidences,” the attorneys wrote. “Such conduct is highly irregular, unseemly at best and improper at the worst.”

The court is scheduled to hear oral arguments next month.

(Source: WSJ)