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Review ordered of liquor agency

Mass. treasurer seeks audit after state pays $1.7m to settle cases

By Todd Wallack
Globe Staff / July 18, 2011

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The Alcoholic Beverages Control Commission has spent an amount nearly equal to its annual budget in the past two years to resolve a trio of employment cases involving harassment, discrimination, and retaliation, according to interviews and documents obtained by the Globe through public records requests.

The cases - two settlements and a court judgment - stem from complaints filed by former workers and a prospective employee over the past decade.

In one case, settled in 2009, the agency presented a novel defense to accusations it had unfairly denied a 57-year-old veteran a job. The defense: The two available slots had to go to relatives of lawmakers, or the Legislature would not fund the positions, according to legal documents.

Following the Globe’s questions about the payments, state Treasurer Steven Grossman, who oversees the agency, asked the Massachusetts inspector general’s office to conduct a “top-to-bottom’’ review of the agency. He said he will also hire an independent consultant to conduct a comprehensive audit.

“While it didn’t happen on my watch, I recognize that anything that goes on has the ability to put a cloud over your operations,’’ said Grossman, who took office in January. “The goal is to get beyond it and that it never happens again.’’

The liquor commission, which has fewer than two dozen employees and a $2 million annual budget, is charged with overseeing more than 22,000 liquor stores, restaurants, bars, wholesalers, and suppliers registered with the state. The resolutions have cost the state about $1.7 million, paid out of the state’s settlements and judgments fund, according to the treasurer’s office.

In addition, an agency investigator is scheduled to be tried this fall on charges he accepted a $3,000 bribe to help a convicted felon obtain a liquor license. The worker, Arthur Hitchman, a former Melrose alderman and aide to Senator Richard R. Tisei, who has since left office, pleaded not guilty to the charges, but lost his job in December.

Kim Gainsboro, who chairs the commission, said the case appears isolated. Internal auditors did not find evidence of similar payoffs at the agency last year, she said. The agency has also taken steps to make it more difficult for investigators to solicit bribes, including assigning multiple enforcement officers to handle some licenses and regularly reassigning them to different parts of the state.

Grossman said the agency today is well run, and its staff is competent and professional.

Last year, the agency found more than 500 violations of the Liquor Control Act statewide - from underage drinking to illegal gambling at bars - more than all the citations issued by the state’s 351 cities and towns combined.

In 2008, the National Liquor Law Enforcement Association named it the enforcement agency of the year. Agency officials noted that a broader audit of the state treasurer’s office released last week did not cite any problems at the liquor commission.

“I have a lot of confidence in the team that is down there,’’ Grossman said.

The patronage case began after Ronald Bridges, a 57-year-old former Marine, complained he was repeatedly passed over for investigator jobs at the liquor commission in 2001 and 2002, arguing it might have been because he was black or over 40. In addition to his military service, which gives him preference in civil service hiring, Bridges has a bachelor’s degree in criminal justice from Northeastern University and worked in corrections.

He filed a case with the Massachusetts Commission Against Discrimination in 2002. The MCAD ruled against the liquor commission, prompting the agency to settle two years ago with Bridges for $324,000, according to the agency.

In the other cases, a Suffolk Superior Court judge in 2009 ordered the commission to pay more than $1 million in court costs, legal fees, and damages to Janet DeCarlo-Staples, a former assistant secretary, after a jury found she lost her job in retaliation for filing a sex-discrimination complaint with the MCAD in 2000.

And in the third case, the liquor agency agreed last summer to pay $360,000 to settle a lawsuit filed by the agency’s former executive director, Cheryl Marshall, who alleged she was forced to resign in 2007 after being subjected to racial harassment, sex discrimination, and retaliation for reporting misconduct within the agency. Marshall is black.

The agency said in court documents at the time that the allegations were unfounded, but later agreed to the settlement.

“A business decision was made that it was in the best interests of the Commonwealth to settle the lawsuit,’’ said Gainsboro.

Todd Wallack can be reached at twallack@globe.com