No ethics violations in Town of Oyster Bay for using Enterprise Security Solutions

The Town of Oyster Bay’s Board of Ethics ruled there was no ethical violations in the awarding of a request for proposal to Enterprise Security Solutions, a cybersecurity company based in New Jersey. The investigation came after the town board learned Enterprise owner Michael Esposito works for Town Inspector General Brian Noone at Nova Venture Partners, a security consulting firm where Noone serves as a partner and Esposito works as the cybersecurity practice leader.

Neither Noone, Esposito nor any representatives of Nova Venture Partners were able to be reached for comment.

Enterprise received an RFP contract from the town board in August 2022 to help reassess the town’s cybersecurity defenses. The RFP had been released following the hacking of Suffolk County’s website, which spurred Oyster Bay to reevaluate their online defenses.

When the town released the RFP, they initially sent it to 30 firms, 13 of which ultimately expressed interest. In an inter-departmental memo provided to the Herald by Sea Cliff resident Arthur Adelman, Noone wrote that an RFP Review Committee composed of six town employees established a set of criteria for choosing the most qualified firm.

In the memo, Noone stated that Enterprise “was ranked with the highest numerical score” according to the criteria the Review Committee had established and recommended that they be awarded the RFP. Enterprise was subsequently awarded the RFP to work for the town for the period of one year in return for $2 million.

On March 21, the day that the town would have voted on approving the resolution the board chose to table the resolution. In a statement released by Brian Nevin, Oyster Bay’s public information officer, the board expressed concern, although it did not specify that Noone’s pre-existing business relationship with Esposito was the cause.

“Out of an abundance of caution, the matter was referred to the town attorney and the Board of Ethics,” Nevin wrote. “On May 22, 2023, the Board of Ethics ruled that no conflict of interest exists.”

Steven Leventhal, an attorney who has served as legal counsel to the Board of Ethics since 2015, explained that the Board went through a three step process to make the determination. First, they investigated whether Noone’s conduct violated the states’ code of conduct, then if it violated any provisions of the town’s code of ethics, and finally whether the conduct violated common law principles, which are stabled from cases decided by state judges over the years.

“Not only did Mr. Noone have no direct or indirect interest in the contract itself, he also had no interest in the proposed contracting party, Enterprise Security Solutions,” Leventhal said. “Mr. Esposito has no ownership interest in Nova Venture Partners.”

Despite this, not all residents are convinced that the issue of hiring Enterprise has been properly addressed by the town. The aforementioned Adelman expressed concern that Enterprise, being a New Jersey-based company and therefore technically a foreign business according to state law, had not been properly registered to operate in this capacity in New York according to the state’s Limited Liability Company Law.

Adelman added that he repeatedly contacted Noone and other town employees with his concerns, but was initially told that he was incorrect, and subsequently that Enterprise would be properly registered by the time the contract began. Adelman alleges that the cybersecurity company had not registered by March 21, and it is currently unclear if it has subsequently registered.

“I mentioned to Frank Scalera (Town of Oyster Bay attorney) that ESS was not registered in New York state, and he said he would make sure that they were in full compliance before the town signed the contract with them,” Adelman said. “That was never done.”