Grim news for Grimm

From Capital New York:

Rep. Michael Grimm surrendered to federal authorities on Monday morning, shortly before prosecutors at the U.S. attorney's office in Brooklyn unsealed a 20-count indictment related to Grimm's ownership of a health foods store in Manhattan.

Loretta Lynch, the U.S. Attorney for New York's Eastern District, presented the indictment at a press conference in Brooklyn, detailing a tax-evasion scheme that she said was "almost breathtaking in its simplicity."

The indictment accuses Grimm of pocketing more than a million dollars in cash payments at the Upper East Side store called Healthalicious.

"When it came to his restaurant, Michael Grimm never met a tax he didn't lie to evade," Lynch said.

The charges include mail, wire, health care and tax fraud, along with two counts of perjury.

According to the indictment, "Grimm paid a large portion of Healthalicious’ employees’ wages in cash and did not report those cash wages to federal and state authorities, thereby lowering the restaurant’s payroll tax costs."

In 2013, two former Healthalicious employees filed a federal civil lawsuit against Grimm alleging the congressman did not pay them minimum or overtime wages as required by law. During a deposition hearing for the case, Grimm allegedly lied "about several material matters in connection with the lawsuit including whether he paid his employees in cash, and if he had interacted with a payroll processing company," according to prosecutors.

The indictment comes after a two-year investigation that was believed to focus on Grimm's congressional fund-raising.

Involvement with Hiram still haunts Julissa

From the Daily News:

The City Council’s new point person in overseeing the $50 billion municipal budget didn’t do such a hot job overseeing a nonprofit group at the center of a Council slush fund scandal, records show.

Julissa Ferreras, the Queens Democrat who was named Wednesday as chairwoman of Council’s Finance Committee, headed the board of directors of LIBRE, the Latino Initiative for Better Resources and Empowerment, when it was looted by then-Councilman Hiram Monserrate.

As a Council member, Monserrate steered $300,000 in city funding to LIBRE and then diverted $109,000 of the money to pay people to work on his campaign for the state Senate.

He later pleaded guilty to federal mail fraud and mail fraud conspiracy charges for the scam.

In addition to serving as Monserrate’s handpicked chairwoman of LIBRE’s board, Ferreras was chief of staff in Monserrate’s City Council office.

The Council’s Finance Committee is highly influential, with oversight of the city budget — making the committee’s chairmanship one of the most sought-after positions in the legislative body.

Ferreras’ ascension to the post was seen as a reward for bucking the Queens Democratic Party by backing Councilwoman Melissa Mark-Viverito’s successful campaign for Council speaker.

Ferreras declined Thursday to answer questions by the Daily News about her role at LIBRE at the time of Monserrate’s wrongdoing.

Huntley to plead guilty

From the NY Post:

Former New York state Sen. Shirley Huntley is planning to plead guilty to mail fraud charges in a new federal case leveled against her, The Post has learned.

The Queens Democrat is expected to admit that she used funds from a non-profit organization to benefit herself and family members, a source said.

The embattled ex-legislator was indicted originally on Aug. 27 by state authorities on charges that she falsified documents to conceal the fact that her niece and an aide allegedly siphoned $30,000 from a sham charity she created. She pleaded not guilty to those state charges.

But Brooklyn federal prosecutors working in the US Attorney's Office's public corruption unit quietly opened a mail fraud case against Huntley — and now she is poised to surrender to authorities soon with the intention of entering a guilty plea, sources said.

A spokesman for the US Attorney's Office in Brooklyn declined to comment on the case against Huntley.

One getting out, another going in

From NY1:

Former State Comptroller Alan Hevesi will be released from prison Wednesday.
A state parole board panel approved Hevesi's release last month.

He's been behind bars since April of last year after a guilty plea on felony corruption charges in a pay-to-play pension scandal.

The Queens Democrat was originally sentenced to one to four years.

He will be on parole through April 2015.

From NY1:

Former Queens lawmaker Hiram Monserrate was sentenced to two years in prison Tuesday.

He must also pay $79,000 in restitution after he pleaded guilty in May to felony conspiracy and mail fraud.

Prosecutors say he diverted $100,000 in City Council grant funds to pay for an unsuccessful state Senate campaign.

"From a very early age I learned when you commit sins you must atone for the sins," Monserrate said. "I took responsibility and this is part of the atonement."

The judge who issued the sentencing compared Monserrate to former president Richard Nixon and said people who use other people's money for their own purposes belong in the lowest level of hell.

The former state Senator is scheduled to report to prison on March 11.

Food stamp fraudsters stole $8M

From the Village Voice:

Federal prosecutors just announced they've charged four New Yorkers -- including two current city employees -- with mail fraud for stealing more than $8 million in food stamp benefits from the U.S. Department of Agriculture.

The complaint, unsealed in Manhattan federal court today, accuses four New York women -- including three who either currently or previously worked for the city's Human Resources Administration -- of spending three years accessing computer databases to approve more than 1,500 food stamp cases under bogus names, addresses, and social security numbers.

One of the women, Alice Bradford, allegedly paid friends to use their mailing addresses, which she and Tori Jackson (who worked for the HRA from 2001 to 2010) passed onto Vanee Sykes, an HRA employee who would then assign phony names and income data and approve the fraudulent food stamp applications.

Also charged is a 30-year HRA veteran named Lois Johnson, who supposedly controlled a post office box to which several of the food stamp cards were sent.

Indictment of Espada expected

From CBS 2:

Sources tell CBS 2 HD that federal prosecutors are getting ready to indict the embattled Bronx politician on a raft of charges relating to his use of money from his Soundview healthcare empire for his personal and political use.

One potential charge is mail fraud, sources said.

As CBS 2 HD first reported last summer, Espada sent out political mailings believed to have been paid for with money from the health clinic. The political mailings had the same postage permit number as the Soundview clinic -- reportedly a no-no.

But that's not all. The state Democratic Party is trying to give Espada the bum's rush. They want him out of the party. In part because, as CBS 2 HD first told you, he doesn't live in his Bronx district. He lives in Mamaroneck.

They don't want him out because he doesn't live in his district. They want him out because he is one of the gang of four that voted with the Republicans last year. Please get your facts straight.

See what happens when you bring in the Feds?

From the NY Times:

Federal and local authorities arrested seven people on Tuesday — including the owners of two construction testing companies, officials from three contracting companies, and an engineer — on charges they falsified testing documents at four New York construction projects.

The people arrested were charged with mail and wire fraud, and are accused of falsifying or attempting to falsify welding, soil boring and asphalt test documents, according to criminal complaints unsealed in federal court in Brooklyn.

The charges, brought by the United States attorney’s office in Brooklyn and based on work by investigators for the Port Authority of New York and New Jersey and the New York City Department of Investigation, represent a growing focus on construction testing, an industry that has come under intense scrutiny in the last two years from the Manhattan district attorney’s office and other agencies.

The case was based on dozens of secretly recorded conversations between some of the defendants and an undercover investigator with the Port Authority inspector general’s office and two unidentified cooperating witnesses, officials said.

Some of those charged were recorded offering or making payoffs of several hundred dollars for the falsified testing documents, and others were recorded accepting payoffs for providing false documents, the officials said.

Some of the documents, according to the charges, were to be provided to the New York City Buildings Department to obtain certificates of occupancy. Others were to be provided to the city’s Parks Department or Housing Authority in order for the companies to be paid.

Mail Fraud 101 by the Kim campaign

"Hey Crappy,

You're not gonna believe the attached document mailed out by Friends of Kevin Kim: the Pastor of Sacred Heart RC Church in Bayside warning his flock about the pagan. And I scanned the outside, too, where it says who's responsible for the mailing. This one is a new low."

- anonymous

Well, anonymous, not only is it a new low, but making it appear that the church mailed these out to voters could have serious consequences for both the church and the candidate. It puts the church's 501c3 in jeopardy and opens up the possibility that Kim could be prosecuted for mail fraud. Federal postal rules prohibit printing an address other than your own on a piece of mail bearing your prepaid postage stamp.


Can't make this stuff up, folks. And yes, the church did print this in their Sunday bulletin. Which begs the question how the Kim campaign got it in enough time to mail it so that it hit before election day.