De Blasio’s Fundraising – Peralta, Reichberg, Rechnitz…

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DNAinfo New York

https://www.dnainfo.com/new-york/20160428/civic-center/heres-what-we-know-about-probe-into-mayor-bill-de-blasios-fundraising

Here’s What We Know About the Probe Into Mayor Bill de Blasio’s Fundraising

Bookmark this page as we’ll be updating it with ongoing developments.

UPDATE: Who’s Who in the Federal NYPD/City Hall Corruption Probe

WHAT’S THE LATEST?
Mayor Bill de Blasio’s political nonprofit was ordered by a judge to comply with a subpoena to turn over records to the New York State Joint Commission on Public Ethics. A lawyer for the nonprofit, the Campaign for One New York, balked at the subpoena for records earlier this year, calling it an “unprecedented fishing expedition.”

WHAT IS THE INVESTIGATION ABOUT?
The FBI, the U.S. Attorney’s office and the Manhattan District Attorney are looking into whether NYPD brass received gifts and expensive trips in exchange for favors from wealthy businessmen with ties to the mayor.

They are also investigating whether there were quid-pro-quos from City Hall in exchange for donations, or if campaign finance and election laws were broken, during de Blasio’s failed 2014 bid to help Democrats take control of the state Senate and through the mayor’s Campaign for One New York, a nonprofit he used to advance his political agenda.

WHAT DOES THE MAYOR SAY?
The mayor has repeatedly denied that his campaign staffers have committed any wrongdoing.

“As I said many times we hold ourselves to the highest standard of integrity. Everything we’ve done from the beginning is legal and appropriate. There is an investigation going on, we’re going to fully cooperate with that investigation,” the mayor told reporters during a recent impromptu press conference.

“We look forward to the speedy conclusion of it but we’ll fully cooperate,” he added. “But since there is an investigation, I can’t go into any details. That’s an ongoing process.”

HOW DID THE INVESTIGATION START?
The case began in 2014 when the FBI got a vague corruption tip involving former NYPD Chief of Department Philip Banks III that led agents to unearth a strange pattern of money going in and out of Banks’ accounts and often through a Bronx bodega’s ATM, sources said.

“There were monies coming in at the same time every month, and moving around and we were wondering what was going on,” a well-placed source said.

The FBI eventually figured out that the transactions didn’t stem from illegal activity and considered shutting down the eight-month probe. But when federal investigators held a summit to decide their next course of action, the decision was made to press forward with the investigation.

Eventually the FBI got on to two Brooklyn businessmen: Jona Rechnitz and Jeremy Reichberg.

The pair allegedly wooed more than a dozen NYPD officers with free food, cash and lavish international trips

Banks, for example, received between $250,000 to $500,000 from Rechnitz’s Manhattan-based real estate firm, JSR Capital, according to the ex-officer’s financial disclosure forms. The money was reported as “income” from “investments,” but additional details were not provided.

Banks also took overseas trips to Israel and the Dominican Republic that were partly paid for by the businessmen. On one trip he traveled with Hamlet Peralta, a Harlem restaurateur who ran the Hudson River Cafe, a spot popular with uptown politicians and police.

Benjamin Brafman, Banks’ attorney, has denied that his client has done anything wrong.

So far roughly a dozen current and former mostly high-ranking police officials have been named in the probe, and several of them have been placed on modified duty or stripped of their guns and badges.

Several of them have since retired from the force.

NYPD Inspector Michael Ameri, who was the head of the department’s highways unit, was questioned by investigators in March, but was not a target of the probe, according to Police Commissioner Bill Bratton. Ameri took his own life in May, with a self-inflicted gunshot wound to the head.

HOW DOES THIS INVOLVE DE BLASIO?
Rechnitz and Reichberg both also have ties to the mayor.

Reichberg raised $35,000 for the Campaign for One New York, which was shut down in March shortly after a good government group accused the mayor of using it as a “shadow government” to conceal who had influence in his administration.

Rechnitz also contributed $4,950 to the mayor’s inaugural campaign in 2013, and gave $102,000 to de Blasio’s effort to unseat Senate Republicans.

In addition to the search for police corruption, federal investigators are also combing through de Blasio’s political fundraising activities for violations of election law.

A January 2016 letter from Risa Sugarman, the state Board of Elections’ chief enforcement counsel, which was leaked to the Daily News in April, accused de Blasio and his team, including top aide Emma Wolfe, of purposely violating election law by routing donations to three upstate senate candidates by using county committees to avoid donation limits.

Sugarman said the violations were “willful and flagrant” and warranted “criminal prosecution.”

De Blasio campaign lawyer Laurence Laufer sent a seven-page letter to Sugarman and Manhattan District Attorney Cyrus Vance Jr., who is investigating the issues raised in the letter, calling the leak a “highly prejudicial and perhaps politically-motivated act,” according to a copy obtained by DNAinfo.

Laufer was not specific about who might have leaked the memo. Even so, DNAinfo exclusively reported that the FBI was already investigating de Blasio’s fundraising before Sugarman notified the DA.

Several of Mayor Bill de Blasio’s closest aides have been subpoenaed in the ongoing federal investigation of his campaign fundraising.

They include Emma Wolfe, the mayor’s director of intergovernmental affairs, Ross Offinger, his top fundraiser, and officials at BerlinRosen, a consulting firm credited with helping secure de Blasio’s mayoral victory.

Sources told DNAinfo that the federal probe has found the mayor’s fundraising “has so many tentacles” that investigators are eyeing possible criminal conspiracy charges for those involved in any wrongdoing.

The feds “are not looking for one deadly sin,” a source familiar with the investigation said. “[They are looking] at this as a potential corrupt organization, that the fundraising mechanism is corrupt.”

Real estate developer Don Peebles exclusively told DNAinfo that de Blasio personally asked him to contribute $20,000 to the Campaign for One New York, a nonprofit set up to advance the mayor’s interests. The money was intended to be used to promote universal Pre-K, which Peebles supported, but he still felt wary about contributing.

“It’s hard for a business person who has business interests in New York City to tell the mayor no, especially real estate developers,” Peebles said.

Also, DNAinfo reported exclusively that federal investigators are scrutinizing the mayor’s 2013 campaign for possible straw donors. The donors are either reimbursed for their contributions or given cash to pass along to the campaign in order to skirt the city’s donation limits.

A spokesman for de Blasio’s campaign said it would return more than $32,000 in contributions, after DNAinfo reported exclusively on several unusual donations.

In late April, the de Blasio administration hired two law firms to represent it amid the ongoing federal probe.

In early May, a lawyer for the Campaign for One New York said the nonprofit would not comply with a subpoena from the New York State Joint Commission on Public Ethics, saying it was “blatantly political.” The state plans to go to court to compel the campaign to comply.

WHO ELSE IS INVOLVED?
Peralta, who also has ties to Rechnitz and Reichberg, is accused of running a $12 million Ponzi scheme where he solicited investors for a fake wholesale liquor business and then used the money to compensate himself and other investors.

One of the people allegedly bilked by Peralta’s scheme was Gerald Liebman, a prominent Uptown landlord who also contributed to de Blasio’s campaign. Liebman lost $1.9 million in the scam, documents show.

Peralta’s restaurant, the Hudson River Cafe, was a popular hangout for uptown politicians and NYPD brass. When news of the probe surfaced, several elected officials scrambled to return money donated to them by Rechnitz, Reichberg and Peralta.

Peralta was arrested in Georgia on April 7 on one count of wire fraud.  He was extradited and arraigned in New York on April 26, and later pleaded not guilty.

DNAinfo also uncovered several unusual donations made to the Campaign for One New York from workers at Primary One LLC, a Queens beauty supply company owned by Sm-Ali Amanollahi.

Several of those donations were made at a fundraiser hosted by Rud Morales, a fixture of the uptown nightlife scene who dates Amanollahi.

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