Liu Hired Consulting Firm Ahead of Treasurer’s Arrest
Monday, July 30, 2012
Two weeks before his campaign treasurer was arrested for fraud, city comptroller John Liu’s campaign hired a consulting firm that specializes in finding electronic data, according to campaign finance filings released earlier this month
Liu’s campaign hired Texas-based Scarab Consulting, shortly before treasurer Jenny Hou was arrested and charged with fraud. She pled not guilty.
A member of the Liu campaign said the hiring of Scarab had nothing to do with the arrest of Hou. “You’d be wrong that it’s connected to her, in anyway,” a source said.
The Liu campaign declined to comment on whether Scarab’s contract was related to the investigation into alleged fundraising improprieties.
A member of the campaign said Scarab was hired because Liu’s campaign was “in a different situation than other campaigns.”
The firm, according to its website, “provides results-driven litigation consulting, information governance, and e-discovery services…to proactively prepare for litigation involving electronically stored information.”
Its website says Scarab clients are usually law firms and corporations. City records show Scarab has a multi-million dollar contract with the City of New York’s law department.
But a search of the city’s campaign finance database doesn’t reveal any other campaign using Scarab as a consultant as far back as 1989.
The first payment to Scarab, on February 14, was for $2,725.42. The following payment, made on March 19, was for $5,127.47. In all, the Liu campaign has paid Scarab more than $11,500, with the last payment on May 30 for $244.97.
A representative in Scarab’s New York City office wouldn’t comment.
Liu has said he believes his former treasurer.