IN THE MATTER OF ROCCO J. ANTONELLI, SR.
Appearing: Robert J. Cordy, Esq: Counsel for the Petitioner, State Ethics Commission Bernard A. Dwork, Esq: Counsel for the Respondent, Rocco J. Antonelli
Commissioners Participating: Vorenberg, Ch., McLaughlin, Bernstein, Brickman, Mulligan
June 29, 1982
DECISION AND ORDER
I. Procedural History
The Petitioner initiated these adjudicatory proceedings on
October 7, 1981 by filing an Order to Show Cause pursuant to the
Commission's Rules of Practice and Procedure, 930 CMR 1.01(5)(a).
The Order alleged that the Respondent, Rocco J. Antonelli, Sr., had
violated G.L. c. 268A, s.3(b) by soliciting and accepting private
loans and other accommodations from the Coolidge Bank and Trust
Company (Coolidge), the Capitol Bank and Trust Company (Capitol),
the U.S. Trust Company (U.S. Trust) and the Suffolk Franklin
Savings Bank (Suffolk Franklin) for or because of his official acts
as the Treasurer of Middlesex County. The Petitioner also alleged
that the Respondent had repeatedly used or attempted to use his
position as County Treasurer to secure unwarranted benefits for his
private businesses at these banks, and had also given reasonable
basis for the impression that these banks could improperly
influence him or unduly enjoy his favor in the performance of his
Treasurer duties in violation of G.L. c. 268A, s.23(d) and(e).
The Respondent's Answer denied these allegations and raised
several affirmative defenses asserting the Commission's lack of
jurisdiction or authority to adjudicate the factual allegations.
Prior to the commencement of adjudicatory hearings in this matter,
the Respondent filed motions to dismiss the Order, for summary
judgment on the pleadings. These pre-hearing motions were denied
by Commissioner Bernard McLaughlin, who was designated as the
See, M.G.L. c. 268B, s.4(c).
Hearings were conducted on twelve days between December, 1981
and February, 1982. The parties thereafter filed briefs with the
Commission and presented oral argument before the full Commission
on April 6,1982. In rendering this Decision and Order, all members
of the Commission have considered the testimony, evidence and
arguments presented by the parties.
II. Findings of Fact
1. Mr. Antonelli was elected Treasurer of Middlesex County
(County) on November 7, 1978 and took office on January 9, 1979.
His responsibilities as Treasurer included the authority to decide
when and with which banks the County, the County Retirement System
or County Hospital would open maintain accounts, the nature of the
accounts, the amount of money to be deposited into each account,
the duration of deposits in each account and when the accounts
would be closed.
2. At all times material, Mr. Antonelli
either owned or had a substantial financial interest in R. J.
Antonelli and Company, an accounting firm; Urban Equity Development
Company (UEDC) a limited partnership which was engaged in a
commercial redevelopment within Davis Square, Somerville, and the
Bartlett Manor and Buchanan Nursing Homes located in Malden.
3. In December, 1976, UEDC received a $450,000 loan from the
Coolidge Bank to finance a commercial redevelopment in Davis
Square, Somerville. Mr. Antonelli and Coolidge Bank subsequently
became involved in litigation over whether Coolidge Bank had agreed
to lend Mr. Antonelli an additional $225,000 for construction
costs. During the pendency of the litigation, Mr. Antonelli ceased
payments on the $450,000 loan, Coolidge Bank took possession of the
commercial property, and the construction was halted.
4. Following a hearing before a court-appointed master, the
master released his preliminary findings in July, 1979 which found
in favor of UEDC but which left unresolved the issue of whether
UEDC should be awarded damages or specific performance of its
agreement. Before July, 1979, Coolidge Bank was opposed to both
renegotiating its loan with Mr. Antonelli and to considering
granting to him new construction financing.
5. In July, 1979, Mr. Antonelli learned that Coolidge Bank had
a new president, Harry Klein, and he arranged a meeting with Mr.
Klein to discuss the financing of the Davis Square redevelopment.
At their first meeting in July, 1979, Mr. Antonelli requested
Coolidge to refinance the loan and to put additional funds into the
project. Mr. Klein's initial response was not encouraging. Mr.
Klein thereafter discussed with other Coolidge officials the
possibility of salvaging the loan through a refinancing whereby
Coolidge would hold a mortgage over the entire Davis Square
development and would "wrap around" the prior financing of other
lending institutions. 
6. In early August, 1979, Mr. Antonelli and Mr. Klein met once
or twice and came closer to a refinancing agreement incorporating
a "wrap around" concept. At one of these refinancing meetings they
discussed the subject of Coolidge Bank doing business with
Middlesex County. Mr. Antonelli told Mr. Klein that the County
would be interested in opening accounts with Coolidge, but he did
not specify a particular deposit amount. Prior to August, 1979,
Coolidge Bank did little, if any, business with either Middlesex
County, the County Retirement System or the County Hospital.
7. On either August 8 or 9, 1979, Mr. Antonelli directed
Assistant County Treasurer James Ferretti to write a series of
checks totaling $500,000 made payable to Middlesex County and to
give the checks to him. On the same day, Mr. Antonelli also
directed the Chief Retirement Officer of the County Retirement
System, John McMahon, to write out Retirement System checks
totaling $600,000 and to give the checks to him. Mr. Antonelli did
not explain the purpose of these checks at that time to either Mr.
Ferretti or Mr. McMahon.
8. After banking hours on August 9,1979, Mr. Antonelli visited
Mr. Klein's office in Watertown and personally handed him the
County Treasurer and County Retirement System checks totalling $1.1
million for the purpose of opening accounts.  Mr. Antonelli
customarily did not make personal visits to banks to open accounts
or to deposit County funds. The letters signed by Mr. Antonelli
and which accompanied the initial deposits into the accounts
stated, "We are enclosing herewith initial deposits with your
financial institution and trust that our future relationship will
prove to be mutually beneficial."
9. At the time of the opening of these accounts, Coolidge Bank
was agreeable to the general concept of a UEDC refinancing, but
major details over the terms of the refinancing remained to be
negotiated and finally ratified by the Coolidge Bank Executive
Committee. On August 13, 1979, Mr. Antonelli submitted a formal
refinancing proposal to Coolidge. On August 23, 1979, Coolidge
Bank's Executive Committee approved the refinancing proposal with
some modification, including a requirement that Mr. Antonelli
acquire $600,000 in construction financing from another bank.
10. In September, 1979, John Street, the Coolidge Bank
attorney who was negotiating the refinancing, wrote a message to
Seta Nercessian, a Coolidge mortgage officer, instructing her to
make a "low-key" call to Mr. Antonelli and see if Coolidge could
help him secure financing. At the time, Mr. Antonelli was being
consistently turned down by banks which did not regard offering a
$600,000 construction loan, under the circumstances, to be a sound
investment. In the message, Mr. Street stated that Mr. Antonelli
had deposited substantial sums of County money in the bank but was
under no legal obligation to keep them there and that he could in
fact shift them to another bank as an inducement to lend him the
11. On October 9, 1979, Coolidge Bank agreed to a $1.95
million "wrap around" refinancing package which included lending
Mr. Antonelli $575,000 in construction loans at an 11 1/2 percent
interest rate, The construction loan was to be converted into a
permanent loan in 1980 at the market rate of interest at the time
the permanent loan was placed. When Mr. Antonelli objected on
October 11, 1979 to the "market rate of interest" provision,
Coolidge agreed to set the permanent financing at a fixed interest
rate of 11 1/2 percent. The loan arrangements were finalized on the
12. Prior to his becoming County Treasurer on January 3, 1979,
Mr. Antonelli had been involved with the Capitol Bank in two
private loan transactions as a borrower and guarantor. His
accounting firm, R. J. Antonelli, Inc., also had a relatively
inactive checking account which was opened in 1975.
13. Prior to 1979, neither the County Treasurer, the County
Hospital nor the County Retirement System had maintained any bank
accounts or investments in the Capitol Bank. Capitol was anxious
to do business with the County when Mr. Antonelli took office.
14. On January 11, 1979, Mr. Antonelli received on behalf of
R. J. Antonelli, Inc. an unsecured $18,000 loan for a one-month
period at a rate of 13 percent (two points over prime). The loan
had been requested during the previous week. During the same week
in which he had requested the $18,000 loan, Mr. Antonelli invested
$3.7 million of County funds with the Capitol Bank in a six-day
repurchase agreement. During the subsequent one-month period,
Mr. Antonelli opened a County Treasurer's checking account
($500,000); a checking account for Hospital funds ($300,000) and
a Retirement System savings accounts ($300,000) at the Capitol
Bank. The $18,000 loan was received and extended and finally paid
off in September, 1979.
15. On September 26, 1979, the Capitol Bank loaned Mr.
Antonelli $135,000 for R. J. Antonelli, Inc. to free up funds for
the Davis Square commercial redevelopment. The initial terms of the
loan were for one year at two percent over prime, secured by Mr.
Antonelli's accounts receivable and two second mortgages on land
in Winchester and Somerville, and a reduction of the principal by
$3,000 monthly. In the process of determining whether to grant Mr.
Antonelli the loan, Capitol Bank was lax in reviewing the
sufficiency of the collateral and the financial statements of Mr.
Antonelli's payment performance at Capitol prior to granting the
16. Following the execution of the loan, Mr. Antonelli
complained on or about October 10,1979 that he was being unfairly
penalized by the two point over prime interest rate which he
claimed was out of line with rates which other banks were offering
him. The Capitol Bank Executive Committee thereupon voted at a
later date in October, 1979 to reduce the interest rate from two
to one point above prime.
17. On October 17, 1979, Capitol Bank received $500,000 from
Middlesex County to be deposited in a County Treasurer's checking
account which Mr. Antonelli had opened in January, 1979.
18. On July 7, 1980, Mr. Antonelli directed Mr. McMahon, the
Chief Retirement Officer, to deposit $300,000 into the County
Retirement System savings account at Capitol thereby bringing the
balance up to $400,000. The account remained idle until December
19. On July 17, 1980, Mr. Antonelli requested from the Capitol
Bank Executive Committee and received a six-month moratorium on the
payment of $3,000 monthly principal on the loan.
20. Although the loan came due in September, 1980, Capitol
continued the loan for two months because of the pending sale of
the Winchester land which secured the loan. Mr. Antonelli
thereafter reduced the outstanding amount by $45,000, and Capitol
rewrote the loan for a new one-year period at one percent over
prime on November 26, 1980.
21. On November 10,1980, Mr. Antonelli directed that $500,000
be deposited into the County Treasurer's checking account at
22. In January, 1981, Mr. Antonelli contacted Capitol Bank and
applied for an $80,000 loan for computer equipment after another
bank which had previously committed itself to the loan had backed
out. Thereafter, on January 12, 1981, Capitol loaned Mr. Antonelli
$116,000 ($80,000 plus $36,000 interest) for a five-year
installment loan secured by the computer equipment. The interest
rate initially recommended by Capitol Bank loan officer Peter Lane
to the Capitol Bank Executive Committee ws 18 percent. However, the
final interest rate approved by the Capitol Bank Executive
Committee was 16 percent.
23. On January 13, 1981, the County deposited $300,000 into
the County Treasurer's checking account at Capitol where it
remained idle through the end of May, 1981. On January 19, 1981,
Mr. Antonelli opened a County Retirement System NOW account at
Capitol with a $100,000 deposit.
24. In May, 1981, Mr. Antonelli requested and received from
Capitol Bank two $7,500 short-term loans to provide working capital
for his two nursing homes which were awaiting vendor payments or
25. Mr. Antonelli's private checking account at Capitol was
frequently and substantially overdrawn in 1979 and 1980, and Mr.
Antonelli received accommodations from Capitol in the form of
either covering the overdrafts or in not charging an overdraft
26. Prior to Mr.. Antonelli assuming office in 1979, U.S.
trust had not received any deposits or investments from the
previous Middlesex County Treasurer.
27. At the time of Mr. Antonelli's assumption of the County
Treasurer office in 1979, Mr. Quinn Sullivan was the President of
U.S. Trust. Mr. Antonelli had dealt with Mr. Sullivan frequently
during the previous fifteen years when Mr. Sullivan was a lending
officer for BayBank.
28. On January 17, 1979, Mr. Antonelli received a $25,000
unsecured personal loan from U.S. Trust at one point above prime.
The original request for the loan was made during a car ride with
Mr. Sullivan during the first week of January, 1979. Shortly after
Mr. Antonelli became Treasurer, Mr. Sullivan made a goodwill visit
to the Treasurer's office on behalf of U.S. Trust to let Mr.
Antonelli know that U.S. Trust was interested in County business
and could provide favorable rates to the County. Mr. Antonelli made
no commitment to deposit County funds in U.S. Trust but responded
that the County would be interested if the rates were competitive.
Mr. Sullivan and Mr. Antonelli left the County offices together,
and Mr. Antonelli asked Mr. Sullivan to drop him off on the way
home. During the car ride to Somerville, they discussed the
progress of Mr. Antonelli's Davis Square project. When Mr. Sullivan
asked Mr. Antonelli if he had any requirements which U.S. Trust
could help him with, Mr. Antonelli responded that he needed a
personal loan of $25,000 to reimburse a family member. Sullivan
responded that it would not be much of a problem and that his bank
would be willing to lend him the money.
29. Mr. Antonelli opened up three County accounts with U.S.
Trust on January 30, 1979. The initial deposits were $10,000
(County Treasurer checking account), $100,000 (Retirement System
checking account) and $750,000 (Retirement System savings account).
30. Mr. Antonelli requested and received from U.S. Trust
private loans of $15,000 and $35,000 in July and October, 1979.
31. Mr. Antonelli requested and received from U.S. Trust in
June and July of 1980 a series of loans for his nursing homes
32. On July 7,1980, Mr. Antonelli directed Mr. McMahon to
deposit $300,000 into the County Retirement System account at U.S.
Trust, where it remained idle through the end of the year.
33. On August 12, 1980, Mr. Antonelli received a short-term
$75,000 loan from U.S. Trust in connection with the mortgage
financing of his Davis Square, Sommerville commercial property.
34. Mr. Antonelli arranged for a deposit of $250,000 into the
County Hospital maintenance account one week later on August
20,1980. The funds remained idle through mid-1981.
35. On October 15, 1980, Mr. Antonelli received from U.S.
Trust an eight-month $100,000 loan for roof work on his Somerville
commercial property. The loan was secured by a second mortgage on
the property. On February 12,1981, at Mr. Antonelli's request, U.S.
Trust agreed to lift its secured mortgage position to allow Mr.
Antonelli to borrow an additional $25,000 from Somerset Savings
Bank, the holder of a $300,000 first mortgage on the property.
Suffolk Franklin Bank
36. In November, 1971, the Suffolk Franklin Savings Bank
agreed to lend to a company owned by Mr. Antonelli and which later
became UEDC $500,000 for commercial redevelopment in Davis Square,
Somerville. Suffolk Franklin had difficulties with Antonelli
because of frequent delinquency payments, and it had authorized
foreclosure proceedings on two occasions prior to 1979.
37. In August, 1979, Suffolk Franklin instructed its attorney
to commence foreclosure proceedings against Mr. Antonelli and
notified Mr. Antonelli that it would increase the interest rate to
11 percent even if all of the back payments were brought up-to-
date. Mr., Antonelli thereafter arranged a meeting with a Suffolk
Franklin official, Mr. Charles Douglas, on August 30, 1979 to
discuss whether the Bank would increase the interest rate on the
38. At that meeting, Mr. Antonelli delivered a check to Mr.
Douglas bringing the mortgage loan account up to date. Mr. Douglas
informed Mr. Antonelli that Suffolk Franklin would rescind its rate
increase if Mr. Antonelli kept his payments up-to-date. At that
same meeting, after the Bank had agreed to reduce or revoke its
rate increase, Mr. Antonelli advised Mr. Douglas that he was the
Treasurer of Middlesex County and suggested that he could deposit
County funds or would consider opening a savings account on behalf
of the County at Suffolk Franklin Bank. Mr. Douglas felt that Mr.
Antonelli was paving the way for leverage with the Bank in the
event that the mortgage loan account went into default, again.
"When Mr. Douglas indicated that he did not think opening an
account would be appropriate, Mr. Antonelli responded that he might
open an account anyway in five or six months.
Mr. Antonelli ha been charged with violations of G.L. c. 268A,
s.s.3(b), 23(d) and (e). Prior to determining the merits of these
allegations, the Commission will address certain constitutional and
procedural issues raised by Mr. Antonelli.
A. Constitutional Issues
1. Combination of Accusatory and Adjudicatory Functions
The Respondent alleges in his Answer that the combination of
the Commission's accusatory and adjudicatory functions within the
same agency violates his due process-and fair hearing rights under
the federal and Massachusetts constitutions. The Commission rejects
this argument as one which is well settled under both federal and
Massachusetts law. In two recent decisions, In the
Matter of George A. Michael, Commission Adjudicatory Docket No.
137, Decision and Order, pp. 24-25 (September 28, 1981) and In the
Matter of John P. Saccone and Edmund W. DelPrete, Commission
Adjudicatory Docket No. 132, Decision and Order, pp. 12-13 (June
1, 1982), the Commission reviewed federal and Massachusetts
decisions which affirm the constitutional validity of combining
accusatory and adjudicatory functions within the same agency. See,
e.g., Withrow v. Larkin, 421 U.S. 35, 46-54, (1975). The mere
authorization by the Commission of an investigation or Order to
Show Cause in fulfillment of its obligation under G. L. c. 268B,
s.4 does not constitute a prejudgment of the merits of a case. See,
School Committee of Stoughton v. Labor Relations Commission, 4
Mass. App. Ct. 262, 272 (1976); Saccone and DelPrete, Decision and
Order, pp. 27-29. Moreover, the Respondent has not suggested how
the combination of functions violates the federal and state
constitution when applied to the facts of his case.
2. Standard of Proof
The Respondent contends that the civil "preponderance of
evidence" standard which the Commission applies to its proceedings
is improper and constitutionally defective inasmuch as G.L. c. 268A
and c. 268B do not prescribe a preponderance standard.
The Commission reiterates that it is a civil enforcement
agency which possess the authority to assess only civil or
regulatory sanctions. See, G.L. c. 268B, s.4(d). The Attorney
General and District Attorneys remain responsible for enforcing the
criminal provisions which may result in punitive sanctions,
including imprisonment. Commission proceedings have been
consistently characterized as civil in nature and are therefore not
subject to the constitutional standards applicable to criminal
proceedings. See, Opinion of the Justices, supra, at 819; Saccone
and DelPrete, at 13. In the Matter of James J. Craven, Jr.
Commission Adjudicatory Docket No. 110, Decision and Order pp. 10-
12 (June 18, 1980) aff'd sub nom. Craven v. Vorenberg, Suffolk
Superior Court Civil Action No. 43269, (further appeal pending) the
Commission determined that the preponderance of evidence standard,
rather than a higher standard of clear and convincing proof or
proof beyond a reasonable doubt, was applicable to Commission
adjudicatory proceedings. In rejecting the adoption of these higher
standards, the Commission reasoned that its potential sanctions
were not sufficiently severe to warrant departure from the
traditional preponderance standard applicable to civil
administrative proceedings. The Commission has applied the
preponderance standard to every adjudicatory proceeding under G.L.
c. 268A and G.L. c. 268B since Craven and believes that these
decisions provide sufficient notice of its standard of proof to
Respondents such as Mr. Antonelli.
The Respondent further asserts that G.L. c. 268A is
unconstitutionally vague, overbroad and ambiguous. In Saccone and
DelPrete pp. 16-17, the Commission fully responded to similar
contentions and finds no reason to repeat those responses in their
entirety here. In summary, the Commission regards the provisions
of G.L. c. 268A to be adequately specific to put Respondents on
notice as to what behavior is proscribed. See, United States v.
Brewster, 506 F.2d 62 (D.C. Cir. 1974); United States v. Irwin, 354
F.2d 192, 196-197, (2nd Cir., 1965), cert den. 383 U.S. 967 (1966);
Colten v. Kentucky 407 U.S. 104,110 (1972).
4. Other Constitutional Issues
The Respondent alleges in his Answer that the Commission has
exceeded its statutory and constitutional authority by adjudicating
matters during the pendency of a criminal investigation of these
same matters by another agency. In the absence of any evidence in
the record verifying the pendency of other investigations, the
Commission finds no need to address this contention
in any detail. However, even assuming that the record confirmed
such an investigation, the Commission finds no basis for either
dismissing or delaying the adjudication of the Petitioner's
allegations in the Order to Show Cause. The Commission's statutory
scheme clearly anticipates that the Commission may act concurrently
with criminal investigations by other agencies. See, G.L. c. 268A,
s.9, 15(b); G.L. c. 268B, s.4(a). Moreover, delaying the
Commission's adjudication of alleged violations of G.L. c. 268A
would be contrary to the legislative goal of a speedy Commission
determination, see, G.L. c. 268B, s.4(c), and would effectively bar
the Commission from proceeding in cases for which the statute of
limitations is a relevant factor. See, Saccone and DelPrete, pp.
The Respondent also alleges that the adjudication of this case
results in an arbitrary and selective enforcement. However, there
is no evidence in the record to support his general contention, and
the Commission finds no basis for concluding that the Petitioner
has abused its broad enforcement discretion. See, Bordenkircher v.
Hay:, 434 U.S. 857, 365 (1978); Oyler v. Boles, 368 U.S.
448,456(1962); Commonwealth v. King, 374 Mass. 5 , 20 (1977); see,
generally, 2 K. Davis, Administrative Law Treatise, 2nd ed.,
B. Procedural Issu:
Prior to the commencement of the adjudicatory hearings, the
Presiding Officer ruled on a series of procedural motions. For the
reasons set forth below, the Commission affirms each ruling.
1. Sufficiency of Evidence
The Respondent contends that the evidence surrounding Capitol
Bank's granting of overdraft accommodations to him was not
sufficient to warrant inclusion of this allegation in the Order to
Show Cause. In the Matter of John R. Buckley, Commission
Adjudicatory Docket No. 108, Decision and Order, pp. 7-14 (May 7,
1980), the Commission fully articulated the well-established
principle that the sufficiency and adequacy of evidence which forms
the basis of a Commission Order to Show Cause is not subject to
prehearing challenge. See, Buckley, at pp. 11-14 and cases cited
therein. Any prejudice which may have accrued to the Respondent by
defending those allegations is outweighed by the requirement that
the Petitioner prove the sufficiency and adequacy of the evidence
through the adjudicatory hearing process.
The Respondent urges dismissal of these proceedings on the
grounds that the Petitioner has failed to provide transcriptions
of pre-hearing conversations and interviews of witnesses who were
not appearing at those interviews pursuant to a subpoena. However,
G.L. c. 268B, s.4(c) requires the Commission to record and preserve
the testimony of witnesses only where the witnesses have testified
pursuant to a subpoena. Inasmuch as there is no requirement that
Commission investigators record their conversation or interviews
with witnesses who are not under oath or who voluntarily testify,
the Commission was under no obligation to provide transcriptions
of such conversations or interviews.
3. Signature on Order to Show Cause
The Respondent also urges dismissal of these proceedings on
the grounds that the Order to Show Cause was signed by the
Associate General Counsel for Enforcement. However, the fact that
the Order to Show Cause was issued by the Associate General Counsel
for Enforcement rather than the General Counsel does not warrant
the dismissal of the proceedings. Both the Commission and General
Counsel possess the authority to delegate the power to sign Orders
to Show Cause and to initiate adjudicatory proceedings on behalf
of the Commission. See Commission Rules of Practice and Procedure,
930 CMR 1.01(1)7. This authority was properly delegated to the
Associate General Counsel for Enforcement. Moreover, the purpose
of the issuance of an Order to Show Cause is to notify a Respondent
of the facts and law upon which the adjudicatory proceeding will
be conducted. The fact that this purpose has been substantially
satisfied in this case outweighs whatever prejudice the Responded
may have incurred by receiving an Order to Show Cause signed by the
Associate General Counsel for Enforcement.
4. Duration of Full Investigation
The Respondent also seeks dismissal of the Order to Show Cause
on the grounds that the Commission based its September 22, 1981
vote for an adjudicatory proceeding on the same evidence upon which
its earlier September 2, 1981 vote finding reasonable cause to
believe that violations of G.L. c. 268A had occurred and
authorizing a full investigation into this matter had been based.
In essence he alleges that he has been deprived of the benefits of
a full investigation. However, the Commission fails to see how the
duration of a full investigation can furnish a basis for dismissing
an Order to Show Cause or for otherwise examining the sufficiency
or adequacy of evidence presented to the Commission during the
investigative stage of these proceedings. See, Buckley, supra. The
Commission reiterates that the sufficiency and adequacy of evidence
is measured through the adjudicatory hearing process.
C. G.L. c. 268A Allegations
1. Coolidge Bank
The Commission concludes that Mr. Antonelli solicited and
accepted something of substantial value from Coolidge Bank in 1979
for or because of his official acts as County Treasurer in
violation of G.L. c. 268A, s.3(b).
Section 3(b) prohibits a county employee
otherwise than as provided by law for the proper
discharge of official duty, directly or indirectly [from] .
. . solicit[ing], accept[ing] [or] receiv[ing] anything of
substantial value for or because of any official act or act
within his official responsibility performed or to be
performed by him.
To establish a violation of s.3(b) the Petitioner need not
demonstrate either a corrupt intent in an employee's conduct or an
understood "quid pro quo" between the receipt of the thing of
substantial value and the performance of official acts.
Commonwealth Famigletti, 4 Mass. App. 584,587(1976); Commonwealth
v. Dutney, 4 Mass. App. 363, 375(1976); Michael, supra, at p.
29. Further, there need be no showing that the performance of
any official acts was in fact influenced by the receipt of the
thing of substantial value. Under s.3(b) the Petitioner must
establish a relationship between the solicitation or receipt of the
thing of substantial value and the performance of an employee's
official acts. Commonwealth v. Dutney, supra. "All that is required
to bring s.3 into play is a nexus between the motivation for the
gift and the employee's public duties." Michael, supra, at p. 31.
The purpose of statutes such as s.3(b) is to reach any situation
in which the judgment of a government official might be clouded
because of the receipt of gifts or other things of substantial
value. "Even if corruption is not intended by either the donor or
the donee, there is still a tendency in such a situation to provide
conscious or unconscious preferential treatment of the donor by the
donee, or the inefficient management of public" United States v.
Evans, supra, at 480. On the basis of these principles, the
Commission makes the following findings with respect to the
Coolidge Bank allegations.
a) "Something of Substantial Value"
The Commission finds that the terms of the refinancing and
other loan requests which Mr. Antonelli made to Coolidge Bank on
behalf of UEDC in 1979, whether examined individually or as part
of a single ongoing transaction between August and October, 1979,
were "something of substantial value" within the meaning of s.3(b).
When viewed in terms of the dollar value involved, the $1.95
million refinancing package, which included a new $575,000
construction loan, is something of substantial value. Compare,
Commonwealth." Famigletti, supra [$50 constitutes something of
substantial value]. Further, the refinancing which Mr. Antonelli
requested was intended to salvage a commercial development which
was at a construction standstill and for which other banks were
refusing to lend additional funds. Mr. Antonelli was therefore
seeking a refinancing which would allow completion of the
construction and which would necessarily result in substantial
benefit to him.
b) 'Official Acts Performed or to be Performed"
Mr. Antonelli decided to open the County and County Retirement
accounts with the Coolidge Bank and to deposit initially funds
totaling $1.1 million in these accounts on August 9,1979. These
decisions were official acts which Mr.Antonelli performed as County
c) "For or Because of"
The facts amply support the allegation of a relationship or
nexus between Mr. Antonelli's solicitation and receipt of the
refinancing package from Coolidge Bank and his official acts in
opening County Treasurer and County Retirement System accounts with
Coolidge Bank in August, 1979:
1. The opening of the County Treasurer and County Retirement
System accounts and the deposit of funds occurred during an
important stage of UEDC negotiations with Coolidge Bank in which
major details of the terms of the refinancing package had not yet
been worked out.
2. Mr. Antonelli chose that particular period to open accounts
and to deposit funds into a bank which had done little, if any,
previous business with the County.
3. The initial deposits made with Coolidge on August 9,1979
exceeded $1 million.
4. The facts surrounding Mr. Antonelli's interaction with
Messrs. McMahon and Ferretti prior to opening the accounts, and Mr.
Antonelli's actions in personally appearing after banking hours to
open the accounts and to deposit the funds suggest an urgency to
make the deposits while UEDC negotiations were ongoing.
5. In the week prior to the opening of the accounts, Mr.
Antonelli had discussed with Mr. Klein the possibility of opening
County accounts with the Coolidge Bank. This discussion occurred
during a meeting whose subject was Mr, Antonelli's UEDC refinancing
request. Mr, Antonelli personally delivered the County checks to
Mr. Klein the following week.
The "for or because of' determination is a question which must
be resolved in light of the facts of each case. Compare, Michael,
supra, at p. 29; Saccone and DelPrete, supra, at p. 10. The
Commission has carefully considered Mr. Antonelli's explanations
for opening County accounts and for depositing large sums in
Coolidge during this period but finds these explanations
unpersuasive. In particular, Mr. Antonelli's testimony that he
wished to deposit funds in banks with several branches located
within Middlesex County does not rebut the strong inferences
supporting a relationship.
d) "Otherwise than as Provided by Law for the Proper Discharge
of Official Duty"
The Commission finds that the solicitation and acceptance by
Mr, Antonelli of the UEDC refinancing requests and loan from
Coolidge Bank was not provided by law for the proper discharge of
his official duties.
The Commission concludes that Mr. Antonelli violated s.23(e)
in his dealings with the
Capitol Bank during the period of January, 1979 through
Under s.23(e) a county employee may not "by his conduct give
reasonable basis for the impression that any person can improperly
influence or unduly enjoy his favor in the performance of his
official duties, or that he is unduly affected by the kinship,
rank, position or influence of any party or person." A major
purpose of s.23(e) is to prohibit an employee from engaging in
conduct which will raise questions over the credibility and
impartiality of his work as a public employee. The Commission has
consistently applied the s.23(e) prohibitions whenever a public
employee has had private financial dealings with the same parties
with whom he deals as a public employee. See, e.g. In the Matter
of William L. Bagni, Sr., Commission Adjudicatory Docket No. 124,
Decision and Order (January 29, 1981) [state inspector violates
s.23(e) by repeatedly soliciting private work from businesses over
whom he has official responsibility]; In the Matter of Louis L.
Logan, Commission Adjudicatory Docket No. 131, Decision and Order
(April 28, 1981) [state employee violates s.23(e) by advancing his
Personal funds to a company while the company is applying for a
large loan which the employee will review in his state position];
EC-COI-81-134 [state official violates s.23(e) by taking a foreign
charter trip which is paid for by private individuals whom the
official regulates in his official capacity.]
In reviewing Mr. Antonelli's public and private dealings with
Capitol Bank during the period of January, 1979 through May, 1981,
the Commission finds a troublesome pattern of decisions either made
by Mr. Antonelli or within his official responsibilities as County
Treasurer to open County accounts or to deposit and retain large
amounts of County funds in Capitol Bank during the same period in
which he was either seeking or receiving private loans from Capitol
Bank. For example, Mr. Antonelli requested an $18,000 loan from
Capitol Bank during the same week in which he invested $3.7 million
in county funds at Capitol Bank; within one month, he had opened
three County accounts at Capitol Bank. On October 17, 1979, three
weeks after Mr. Antonelli received a $135,000 loan from Capitol
Bank, $500,000 was deposited into the County Treasurer's checking
account at Capitol Bank. Further, Mr. Antonelli received a $116,000
loan from the Capitol Bank on January 12,1981. On the following day
$300,000 was deposited into the County Treasurer's checking account
at Capitol Bank where it remained idle through the end of May,
1981. The Commission finds that the time pattern of Mr. Antonelli's
public and private dealings with Capitol Bank during the period of
January, 1979 through May, 1981 gives a reasonable basis for the
impression that Capitol Bank could improperly influence him or
unduly enjoy his favor in the performance of his official duties
as County Treasurer, in violation of s.23(e). While the facts also
reveal other violations of s.23(e) as well, the Commission believes
that the three aforementioned fact patterns exemplify the kind of
conduct which s.23(e) was designed to prohibit and therefore
findsthat the consideration of additional violations would be
The Commission has carefully considered the merits of the
Petitioner's allegation of a s.3(b) violation with respect to Mr.
Antonelli's public and private dealings with Capitol Bank. While
the facts present a clear pattern of s.23(e) violations, the
Commission is not persuaded that the inferences from the
coincidence of Mr. Antonelli's
public and private dealings with Capitol Bank, without more,
establish facts sufficient for a violation of s.3(b). Compare,
Michael, Supra, at p. 34; Saccone and DelPrete, supra, at pp. 10-
11; discussion of Coolidge Bank violations, srnpra, at pp. 29-30.
The Commission similarly concludes that Mr. Antonelli violated
s.23(e) in his dealings with U.S. Trust during the period of
January, 1979 to May, 1981.
A review of Mr. Antontelli's public and private dealings with
U.S. Trust during this period again reveals, as with Capitol Bank,
a troublesome pattern of decisions by Mr, Antonelli to open County
accounts or to deposit and retain large amounts of County funds in
U.S. Trust during the same period in which he was seeking or
receiving private loans from U.S. Trust. In particular, the
Commission finds that Mr. Antonelli's solicitation or receipt of
three specific loan transactions during the same period in which
he opened County accounts and deposited County funds exemplify
conduct which violates s.23(e).
Within two weeks after Mr. Antonelli had received an initial
$25,000 personal loan from U.S. Trust, he opened three County
accounts, including a Retirement System Savings account of $750,00.
Additionally, a series of U.S. Trust loans to Mr. Antonelli's
nursing homes in June and July, 1980 totalling $35,000 occurred
during the same period in which Mr. Antonelli directed a $300,000
deposit into a County Retirement System account at U.S. Trust where
it remained idle through the end of the year. Further, within one
week after Mr. Antonelli received a $75,000 loan in August, 1980,
he arranged for a deposit of $250,000 in the U.S. Trust County
Hospital account where it remained idle through the middle of 198l.
For the reasons expressed in the discussion of Capitol Bank,
the Commission finds that the time pattern of Mr. Antonelli's
public and private dealings with U.S. Trust during the period of
January, 1979 to May, 1981 gives a reasonable basis for the
impression that U.S. Trust could improperly influence him or unduly
enjoy his favor in the performanceof his official duties as County
Treasurer in violation of s.23(e).
Suffolk Franklin Bank
The Commission concludes that Mr. Antonelli violated s.23(e)
on August 30, 1979 by offering to either open a County account or
deposit County funds in the Suffolk Franklin Bank. The facts
warrant no extended discussion. Mr. Antonelli's offer occurred at
a meeting with a Suffolk Franklin Bank official who had agreed
during the meeting to rescind an interest rate increase a $500,000
UEDC private loan account wh was delinquent. The Commission finds
that the timing of Mr. Antonelli's offer created a reasonable basis
for the impression that Suffolk Franklin would unduly enjoy Mr.
Antonelli's favor in the performance of his official duties in
violation of s.23(e).
On the basis of the foregoing, the Commission concludes that
Mr. Rocco J. Antonelli, Sr. violated G.L. c. 268A, s.s.3(b) and
23(e). Pursuant to its authority under G.L. c. 268B, s.4(d) the
Commission hereby orders Mr. Antonelli to pay the civil penalties
set forth below. In arriving at these penalties, the Commission has
carefully considered the differences in the gravity of the
offenses. Accordingly, the Commission orders Mr, Antonelli to:
1. Pay $1,000 (one thousand dollars) to the Commission as a
civil penalty for soliciting and accepting something of substantial
value from the Coolidge Bank in violation of G.L. c. 268A,
2. Pay $750 (seven hundred and fifty dollars) to the
Commission as a civil penalty for each of the three violations of
G.L. c. 268A,
s.23(e) relating to the Capitol Bank, for a total of $2,250 (two
thousand two hundred and fifty dollars).
3. Pay $500 (five hundred dollars) to the Commission as a
civil penalty for each of the three violations of G.L. c. 268A,
s.23(e) relating to the U.S. Trust, for a total of $1,500 (fifteen
4. Pay $500 (five hundred dollars) to the Commission as a
civil penalty for his violation of G.L. c. 268A, s.23(e) relating
to the Suffolk Franklin Savings Bank.
The Commission orders Mr. Antonelli to pay these penalties
totalling $5,250 (five thousand two hundred and fifty dollars) to
the Commission within thirty days of the receipt of this Decision
 The substance of these motions is discussed, Infra.
 The "wrap around" was a financial restructuring
arrangement under which Coolidge Bank would provide Mr. Antonelli
with funds to pay off his other outstanding obligations.
 As of January, 1979, neither the count,. county Retirement
System or county Hospital had accounts with Coolidge. During Mr.
Antonelli's first month in office, he received requests from
Coolidge shareholders and clients to open county accounts with
Coolidge, although he had not opened any such accounts through
 Mr. Antonelli did not recall this visit during his
testimony at the adjudicatory hearing. The Commission credits Mr.
Klein's testimony on this point.
 The repurchase agreement was a short term investment which
provided higher income potential than certificates of deposit but
which was not insured by the Federal Deposit Insurance Corporation.
 According to the testimony of Capitol Bank officials,
Capitol's decision was made on the basis of Antonelli's
relationship with them, rather than on the sufficiency of the
paperwork requirements. In March, 1980, an FDlC examiner classified
this loan as substandard. The principal criticism was the lack of
complete, reliable paperwork to substantiate the sufficiency of
Mr. Antonelii's finances or his collateral. The examiner also felt
that the loan should have clearly indicated the remaining terms
at the end of the one-year period.
 The record does not reveal the precise date in October,
1979 on which the interest rate reduction decision occurred.
 It is unclear from the record whether Mr. Antonelli or his
assistant treasurer Mr. Ferretti decided to deposit these fund.
However, Mr. Antonelli's official responsibilities as County
Treasurer included decisions regarding the maintenance of accounts,
and Mr. Antonelli reviewed county bank status records on a weekly
 Capitol Bank officials testified at the hearings that
their rationale for the moratorium included Mr. Antonelli's stature
in the community, his creditworthiness, and an effort to ease Mr.
Antonelli's financial difficulty at the time.
 A follow-up FDIC review in 1981 continued the substandard
classification of this loan.
 Capitol Bank officials explained during the hearings that
Capitol had no fixed customer policy on overdrafts, and
accommodated Mr. Antonelli based on efforts to ease his business
difficulties. However, following the FDlC substandard
classification of the $195,000 loan in March, 1980. Capitol
informed Mr. Antonelli that it would no longer cover his overdrafts
and would charge him for each overdraft. The bank also arranged
for Mr. Antonelli to have a $5,000 overdraft coverage provision
through an AMEX Gold Card. Most of the overdrafts in 1980 and 1981
were due to the sequence of check clearing procedures rather than
from insufficient deposits. Testimony was offered at the hearings
that the sums which would have been asssed for overdraft penalties
would have been less than $500.
 An examination of the County banking records does not
reveal the subsequent opening of any County accounts with Suffolk-
 The Commission regards the statutory seheme of G.L. c.
268B, s.4. as applied in this case, to be sufficient to satisfy
amply due process requirements. Moreover, the Respondent chose not
to pursue his constitutional arguments following the filing of his
Answer and has offered no precedent to support his contention.
 The standards of conduct appearing in s.23 have been
enforced and interpreted by the Commission on hundreds of
occasions since 1980. These standards, and in particular the provisions under
which Mr. Antonelli has been charged, are sufficiently clear to
satisfy constitutional standards, see. Tenney v. State Commission
on Ethics 395 So.2d 1244 (Ma. 2nd D.C.A., 1981) and are commonly
employed to enforce the principles of conflict of interest
statutes. See, i.e., Presidential Executive Order 11222, s.201(c)
(1965); 5 C.F.R. 735.201(a) (1976); N.Y. Public Officers law, s.74
(9) (F) (McKinney Supp. 1981); Del Code Ann Tit. 29, s.5855(d), (g)
(Supp. 1974); Michigan Stat. Ann., s.15.275.
 Even if the sufficiency and adequacy of the evidence
forming the basis of the Commission's allegations in the Order to
Show Cause could be independently adjudicated in a pretrial
proceeding, the allegations in the Order to Show Cause related to
the Capitol overdraft accommodations were within the scope of the
Petitioner's preliminary inquiry report which was presented to the
 As an elected county official, Mr. Antonelli is a "County
employee" within the meaning of G.L. c. 268A, s.1(d).
 These same facts also constitute a violation of s.23(e)
which prohibits a county employee from, "by his conduct giv[ing]
reasonable basis for the impression that any person can improperly
influence or unduly enjoy his favor in the performance of his
official duties or that he is unduly affected by the kinship, rank,
position or influence of any party or person." see discussion of
 See, also United States v. Niedberger, 580 F.2d 63,69
(3rd Cir. 1978). cert. den. 439 U.S. 980 (1978). United States v.
Evans, 572 F.2d 455, 480(5th Cir., 1978); United States v. Irwin,
354 F.2d 192, 196 (2nd Cir. 1965). which reach the same conclusins
under comparable federal provisions. See, 18 U.S.C. s.201(g).
 See, Final Report of the Special Commission on Code of
Ethics, 1962 House Doc. No. 3650 at 11 upon which the provisions
of s.3 were based. ("Significant in these subsections is the
provision that the thing given must be of 'substantial value.' The
Commission concluded that this was a standard to be dealt with by judicial interpretation in relation to the facts of the particular
case and that it was more desirable than the imposition of a fixed
valuation formula.") In his Answer, Mr. Antonelli admitted that the
refinancing was something of substantial value to Coolidge Bank.
 The Commission does not agree with the Respondent's
contention that his activities prior to the passage of St. 1981,
c. 293 were implicitly lawful under G.L. c. 268A. In 1981, the
Legislature amended G.L. c. 35. s.10 to prohibit county officials
from accepting loans or other things of value from an institution
or business where they have invested or committed county funds as
part of their official duties, See, St. 1981, c. 293. Nothing in
the language or legislative history of the amendment suggests that
the Legislature intended to confer immunity on county officials
for prior violations of other statutes such as G.L. c. 268A.
Moreover, the commission's findings of violations of G.L. c. 268A
in this patter do not rest merely on Mr. Antonelli's dual status
as a county Treasurer and businessman.
 Contrary to the Respondent's pre-hearing assertion, the
Commission pose the authority under G.L. c. 268B, s.4 to
investigate, adjudicate and impose penalties for any violation of
G.L. c. 268A, including the six standards of conduct contained in
G.L. c. 268A, s.23. The reference in G.L. c. 268B, s.3(i) to the
commission's status "as the primary civil enforcement agency for
violations of c. 268A, as specified in s.s.9 and 15 of that chapter
. . ." is not inconsistent with G.L. c. 268B, s.4. G.L. c. 268A,
s.s.9 and 15 authorize the Commission to initiate an additional
action for the recovery of damages on behalf of the Commonwealth
or county where a party's violation of c. 268A has resulted in an
economic advantage. The Commission's authority to initiate such
civil enforcement actions can only be reasonably read as a
supplement to, rather than a limitation on, the commission's broad
authority under G.L. c. 268B, s.4. See, Graham v. McGrail, 370
Mass. 133. 140(1976) [G.L. c. 268A must be given a workable meaning.]
The Commission's policy of adjudicating violations of G.L. c.
268A, s.23 has received judicial approval. See, Craven v.
Vorenberg, supra. While it is true, as the Respondent suggests,
that the commission could have chosen to exercise its authority
over s.23 in a different manner, for example, by merely reporting
previously investigated violations of s.23 to an employee's
appointing official rather than by initiating adjudicatory
proceedings, the policy which the Commission has adopted is a
permissible exercise of its discretion under G.L. c. 268B, s.4.
Moreover, the adoption of the Respondent's alternate suggestion
would render s.23 ineffective in cases involving elected officials
such as Mr. Antonelli who do not have an appointing official who
can exercise disciplinary authority over them.
 For the same reasons, the Commission does not reach the
issue of whether the same facts which form the basis of the s.23(e)
violations would also violate s.23(d).
 The three cited fact patterns arc merely examples of
violation of s.23(e) and are not a complete recitation of all such
violations within the record. For the reasons stated previously,
the Commission finds no need to either accumulate additional
violations of s.23(e) in this case or adjudicate further violations
of s.23(d) based upon those same facts.
The Commission also notes that it is not persuaded that the
inferences from the coincidence of Mr. Antonelli's public and
private dealings with U.S. Trust establish facts sufficient for a
violation of s.3(b).
 The Petitioner did not pursue the allegation of a s.3(b)
violation from these facts in its post-hearing brief. See, Brief
of Petitioner at p. 43. The Commission does not find a sufficient
"relationship" to warrant a s.3(b) violation. The Commission also
finds that the consideration of additional violations under s.23(d)
would be unnecessarily cumulative.
 The commission finds no need to impose a separate penalty
for Mr. Antonelli's violation of s.23(e) for Coolidge Bank since
the same facts form the basis of both violations.
 Commissioner McLaughlin dissents from the Commission's
conclusion of a s.3(b) violation but concurs in the conclusion of
a s.23(e) violation with respect to the allegations involving
Coolidge Bank as well as the other banks.
End Of Decision