Panel Investigates Poughkeepsie Election Spending

By FRANK LYNN, Special to the New York Times

Holding its first hearings designed to expose political and governmental scandals, the New York State Commission on Government Integrity today heard witnesses describe how up to $776,967 was funneled through various Republican committees and Democratic and Republican political consultants to influence an election and win approval of a shopping mall in Poughkeepsie.

Two of the Poughkeepsie Town Board candidates who were elected in 1985 at least partly because of the massive spending testified they had no input in the literature or mass mailings and that their names and those of their wives were forged on letters to their constituents.

The hearing pointed up the role of veiled business contributions in some political campaigns and hired political consultants who help disguise the source of the funds for sophisticated and even technological electioneering.

The hearings also called into question how the highly political State Board of Elections monitors compliance with the state election law with one commission member, Cyrus R. Vance, the former Secretary of State, questioning whether there was actual ''wrongdoing'' in the state board's investigation of the Poughkeepsie elections.

Refusal to Testify

The board's chief investigator, Frank Polsinello, already indicted for embezzling board funds in another matter, refused to testify before the commission on the grounds that his testimony might incriminate him. The integrity commission is also temporarily enjoined from hearing testimony about the elections board investigation pending a court hearing.

Tesitifying today were: Philip Friedman, a Democratic campaign consultant; William Paroli, the Poughkeepsie Republican chairman; Anthony Carpiniello, the deputy chief investigator of the commission and three Poughkeepsie Town Board candidates.

The crux of their accounts was that the Pyramid Corporation of Syracuse and its officers and their wives spent $776,967 in direct payments to political consultants or in contributiions to various Republican committees that in turn also paid the consultants to influence the Poughkeepsie town board election and subsequent approval of the Galleria shopping mall on Route 9 near Poughkeepsie.

The legality of the contributions was not clear but their secrecy during the campaign was, because they were not reported to the Dutchess County Board of Elections until after the election.

The key figures in the large infusion of outside money were partners of Pyramid, particularly Robert Ungerer, Thomas Spargo, counsel to the Republican state committee and an election law expert and Philip Friedman, the New York City Democratic and self- described ''general contractor'' of the election campaign.

A Large Payment.

A total of $653,892 was paid to Mr. Friedman's Campaign Strategies Inc., either directly by Pyramid or indirectly by Pyramid through the Republican committees.

Ironically, Mr. Friedman usually works for Democrats. He hired another Democratic concern, Penn & Schoen, to conduct the polling for the Poughkeepsie campaign. Penn & Schoen was involved in an earlier investigation of forged petitions by the Manhattan District Attorney Robert M. Morgenthau. Mr. Friedman also recommended the hiring of Richard Fife, another Democratic consultant and Fred Pheiffer, former executive director of the Republican state committee.

Mr. Friedman, who has cooperated with the committee, according to its chairman, John D. Feerick, but was accompanied by a lawyer, summed up the goal of his former client, Pyramid. ''What these people were seeking to do was to influence an election for their own personal pecuniary gain, for no other purpose whatsoever, in my opinion.''

He testified that he dealt not with the candidates but with Mr. Ungerer of Pyramid, whom he assumed was consulting with Mr. Paroli, the Republican town chairman. But, Mr. Paroli testfied that he did not discuss campaign strategy with Mr. Ungerer because the developer was ''working both sides of the street,'' dealing with local Democrats, too.