Mark Peters
Mark Peters (NYLJ/Rick Kopstein)

Ask attorney Mark Peters if he would hesitate to break ranks with close friend and political ally Mayor Bill de Blasio as the city’s top watchdog, and he will mention David Paterson.

The former governor had appointed Peters to the state’s Commission on Public Integrity in 2010. Peters later joined the other commissioners to levy a record fine against Paterson after finding he violated the public officers law by soliciting and receiving free World Series tickets.

Peters pledges to bring that type of political impartiality to City Hall if the City Council confirms his appointment today as commissioner of the Department of Investigation, an agency that probes city employees and contractors for corruption, fraud, waste or unethical conduct.

“Professional prosecutors understand you go where the facts take you, and the mayor understands that. And the mayor and I have been clear with each other on that,” Peters, a former prosecutor, said in an interview with the Law Journal.

Peters, 48, is a partner at Edwards Wildman Palmer. In private practice, he represents financial institutions in litigation, investigations and regulatory matters.

See a brief bio of Peters.

But Peters has years of government experience. He served as special deputy insurance superintendent in charge of the New York Liquidation Bureau, and was chief of the public integrity unit and deputy chief of the civil rights bureau in the state Attorney General’s Office under Eliot Spitzer. He made an unsuccessful run for Brooklyn district attorney in 2005.

Peters said he first worked with de Blasio when they served on a Brooklyn school board in 1999. Until Jan. 6, he was de Blasio’s campaign and transition treasurer, one of the few attorneys serving as a close aide. He also contributed $4,950 to de Blasio’s campaign last year and another $2,475 for a possible election runoff, the maximum allowed for each, according to finance records.

His ties to de Blasio caused concern among some City Council members who grilled him at a Jan. 30 public hearing.

“What do I tell my constituents about the appearance of partiality with someone who hasn’t even been gone for 30 days from some pretty high-level positions in the de Blasio administration?” Councilman Jumaane Williams said.

At the hearing, Peters repeatedly assured council members of his ability to remain independent.

When council members asked for an example of when Peters would need to recuse himself in a DOI investigation, Peters said he would not need to recuse in a probe involving the mayor or a campaign donor. But he acknowledged if a case was referred to DOI by the city’s Campaign Finance Board involving de Blasio’s campaign finances, he would recuse.

When asked in his interview with the Law Journal about his campaign contributions, Peters said he would be “surprised” if no other DOI commissioner had donated money.

Those who have worked with Peters defended his objectivity.

“It really comes down to the ability to do the right thing, and Mark … showed it and I think the commission showed it during that period of time,” said Michael Cherkasky, a former prosecutor who worked with Peters as chair of the Commission on Public Integrity, which spearheaded Paterson’s ticket investigation.

Cherkasky, now leading consulting firm Brightline GRC, said the DOI position has always an “inherent conflict” because a mayor, who nominates commissioners, can also remove them. A number of past DOI commissioners have had close personal and political connections, he noted.

“You’re going to bring cases at times where the person who appointed you potentially looks bad. It’s all about character and having the integrity to do the right thing,” Cherkasky said.

Peters and supporters also point to his role from 2007 to 2009 at the Liquidation Bureau, a state office that takes over defunct insurance companies, as evidence of his integrity. The former head of the agency had been charged with grand larceny and defrauding the government when Peters came in.

“We needed to bring in a chief who had impeccable credentials, considered a person of great integrity but also with an investigative past or qualification, and Mark seemed to be the perfect candidate,” said Eric Dinallo, who was superintendent of insurance when Peters was hired. “Everything he did was basically objective and very, very fact based.”

As part of a series of reform measures in the bureau, Peters created a new panel of outside counsel firms that were qualified and independent. Previously, Peters said, “there was a significant overlap between politically connected lawyers and the lawyers on [the bureau's outside counsel] list” who received lucrative contracts.

Dinallo, now a partner at Debevoise & Plimpton, said Peters has proved himself to be an honest broker.

“My view is that he’s got such a productive track record of independent investigatory nature and achievements that I don’t have a problem” with his political tie, he said.

“First Big Task”

While DOI has oversight of more than 45 mayoral agencies with 300,000 employees, as well as hundreds of city commissions and boards, it’s facing what could be it’s most significant task to date—the appointment of a police watchdog.

Responding to concerns over the New York City Police Department’s “stop-and-frisk” policies, the council created an independent inspector general’s position for the police, and directed the DOI commissioner to choose someone for the post by April 1.

“The first big task is working with the mayor to identify a top notch vigorous and professional police inspector general,” Peters said. At the DOI, he added, “there’s now responsibility of making sure that the police department is protecting the community in all the ways that it should and also respecting the rights of all New Yorkers in every way they should.”

The creation of an inspector general who will report to the DOI commissioner is “a big change,” Cherkasky said.

“Oversight of NYPD is now more high profile and DOI now comes more into public light,” Cherkasky said. “It ups the profile and probably enhances the importance [of the agency.]“

The role of NYPD inspector general within the DOI will be difficult to determine at first, said Eric Lane, dean of the Maurice A. Deane School of Law at Hofstra University and former special counsel to the speaker of the city council.

While the DOI seeks to improve efficiency at city agencies, its emphasis is on catching wrongdoers, Lane said, while the police IG will be focused more on civil rights and policies.

‘Backbone’ of Prosecutions

Historically, the Department of Investigation, formed as a result of the Tweed scandal in the 19th century, hasn’t been in the spotlight as much as the Manhattan District Attorney’s office or the Southern District U.S. Attorney’s office.

The department doesn’t prosecute cases but it has subpoena power and it frequently refers investigations to prosecutors.

DOI, which has its own NYPD police squad, has a $22 million budget and at least 350 staff members.

“If you talk within anyone in the Southern District of New York, they will tell you [the DOI is] in many respects the backbone of a lot of prosecutions that are brought in the Southern District of New York and the [city] D.A. offices relating to fraud or wrongdoing by city employees,” said Michele Hirshman, a partner at Paul, Weiss, Rifkind, Wharton & Garrison, who was first deputy attorney general in the state attorney general’s office and worked with Peters.

In his Law Journal interview, Peters said he would spend much of his time working with senior staff at DOI to review current investigations and issues.

“We need to be constantly re-examining whether we have sufficient internal controls in place in all of our agencies, given the huge number of people employed in the city and the vast dollars the city spends,” he said.

Attorneys and others working with the agency “will find that the department will continue to be vigorous and a forceful law enforcement agency but one that is both fair and seeking to protect the best interests of the city,” Peters said.

Many attorneys agreed. Rose Gill Hearn, the DOI commissioner under Bloomberg, raised the agency’s profile. In fiscal year 2013, 840 arrests were made resulting from DOI investigations, compared with less than 400 arrests when Gill Hearn began in 2002. The agency referred for prosecution 1,053 case in the last fiscal year, up from 630 in 2009.

Hearn, the longest-serving DOI commissioner, said she’s spoken with Peters for the transition and found him “totally committed” to the department.

“You have to learn your department, you have to learn your people and then you have to learn about the other departments,” said Hearn, who now chairs the city’s Campaign Finance board and works at Bloomberg’s new consulting group, Bloomberg Associates.

Besides open cases, Hearn said, Peters will need to review past reports, including two fresh reports on the city’s 911 system and the Board of Elections.

“He is certainly not starting from scratch,” she said, “but he will certainly build on it.”