Daily News from New York, New York • 2

DAILY NEWS Tuesday. July 26. 1988 Couple pocketed bigbucks By DON FLYNN 1 Biiiiiiilf shft ---B-V rr Hulk," lets John Lavenburg of Bloomfield, press the flesh in their 1985 meeting in New York. Meeting attorney general's office, rather than by self-indulgent organizers of Connecticut charity. wwmMw courant Daily News Staff Writer A Connecticut couple who raised $237,000 to grant dying children "a final wish" used the money to grant their own wishes first, including a Cadillac, jewelry and fat salaries, the state attorney general said yesterday.

Michael and Suzanne Bates of Waterbury, who ran the Genie Project out of their home, spent only about $10,000 "to send three kids to Disney World," said Joseph Lieberman, who shut down the operation. They also sent a kid to a Minnesota Vikings game, but went along themselves on the charity's money. The rest of the charity's money went to the Bateses and to a telephone soliciting company hired to raise funds. The firm, Community Dynamics of Stratford, got $155,000 as its fee, Lieberman's office -said. "We know there were some wishes that were not grant-' ed," said Jim Kennedy, a spokesman for the office.

"In fact, we helped grant one of them. One retarded kid wanted to meet Lou Ferrigno, The and we helped arrange that" Meeting with Lou John Lavenburg, 22, a patient at Newington Children's Hospital with Down's syndrome, was brought to the Doral Park Avenue Hotel in New York to meet Ferrigno, who starred in the TV series "The Incredible Hulk." Lieberman filed a civil law- suit against the Bateses in 1985. "They were taking money from the charity for themselves," he said. "They paid themselves excessive salaries, took unsecured loans from it, paid themselves $500-a-month rent for the use of their home, and also bought several thousands worth of jewelry from a jewelry distributorship they owned." They also leased a Cadillac and rented X-rated movies, he said. Lieberman said yesterday the Bateses have agreed to pay a $50,000 fine and disband the Genie Project They admitted during a 1987 criminal trial that they paid them- selves salaries of more than $31,000 a year, and used Genie Project funds for person-al loans and rents totaling $28,000.

Separate ways The Bateses are now divorced and have different jobs. Michael Bates lives in PU syi tip formal probe was not needed because there was no. indication Stern had committed a crime. In other words, they believed Stern's story that he was joking. Stern, who had accused Levine of being a "humorless jerk," could not be reached for comment His agent, Don Buch-wald, did not return calls, nor did Tom Chiusano, WXRK general manager.

Strang would not say whether Levine had beeri disciplined for writing the letter but noted he still was a DEA supervising agent in New York. livered a letter to the Daily News asking witnesses to rat on Stern after the outspoken deejay bragged on his WXRK-FM show that he had provided drugs to a guest of his Feb. 27 TV special, "Howard Stern's Underpants and Negligee Party." Levine's bosses chastised him for "inappropriate behavior," but the DEA and U.S. Attorney Rudolph Giuliani launched what Strang described as an "informal investigation." After interviewing those involved, including Stern, the feds determined that a LOU FERRIGNO, TV's "Incredible was partly arranged by Connecticut Bates Jives in Stafford Springs, Lieberman's office said. In an agreement announced yesterday that settled the state's lawsuit they admitted no wrongdoing and agreed never to hold any office or directorship in a Connecticut charity.

Under the agreement Michael Bates has paid $18,259 to the state Consumer Protection Department. An additional $5,298 is frozen by court order in banks and will be turned over to the department, Lieberman's office said. Additionally, Suzanne Bates will pay $24,259 to the state at a rate of $200 a month over 122 months, and $5,000 worth of computer equipment will be turned over to the Consumer Protection Department, Lieberman's office said. 33. MAIN A.M.

28 Apple 6 Harvey Araton 44 Business PULLOUT Richard G. 27 Editorial 28 Bill Gallo 44 Bob 25 Inquiring 23 Charles Krauthammer 27 National 19 New York 23 24 Bill Reel 27 People 11 Rigby .....6 Uz Smith ..8 By DAVID J. KRAJICEK i Daily News Police Bureau Chief Radio big mouth Howard Stern has been cleared of allegations based on his own quip that he had procured narcotics for a guest on his cable television show. "We have reviewed the entire matter and spoken to those involved and we have concluded that there is no basis for further investigation," said Robert Strang, spokesman for the Drug Enforcement Administration. Five months ago, DEA agent Michael Levine de ..42 TV Listings 67 World Report 17 EXTRA Cover Story: Gloria Estefan 29 Ann 38 Marilyn Beck 30 Erma Bom 38 Bridge 38 Dr.

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