LIVE | Dozens of NYCHA employees arrested in connection with a federal corruption probe

prosecution agreement in exchange for their cooperation it gives people a choice you can come clean quickly and get on the right side of the law or you can roll the dice and you can find yourself in handcuffs like the 70 Nitra employees charged today when we uncover the crime ourselves you can report the criminal conduct you know about by emailing USA n. wbp usdoj.gov and as always anyone who is aware of wrongdoing in city government whether you're contractor a Nicha employee a resident or anyone else can report it directly to the New York City Department of investigation by calling 21236 3356 or emailing oig Nicha do.nyc dgov now contractors who paid Nicha superintendent should not be afraid to come forward and speak out as the complaints today made clear many contractors have already been brave enough to tell law enforcement about the drives that Nicha employees demanded of them going forward contractors should understand that Nicha employees should not be asking for a single penny and if they do now you know where to report it now public housing is a vital part of New York's history present and future and those who betray Nicha the city or the taxpayers will be held accountable today's charges are a product of tremendous partnership nearly 700 law enforcement agents par participated in the arrest that took place in New York and elsewhere today I want to thank our partners at the New York City Department of investigation US Department of Homeland Security Homeland Security investigations US Department of Housing and Urban Development office of Inspector General US Department of Labor office of Inspector General as well as a special agents and Task Force officers of this office now building a case and executing arrest on this scale has requ required tremendous resources and dedication and these agencies have been with us every single step of the way I also want to thank the New York City Police Department and the US Marshall service for their assistance with today's arrest I also want to commend Nicha they have already begun to implement changes to root out corruption and have been entirely supportive of our efforts to hold corrupt Nicha employees accountable we have worked collaboratively with Nicha to ensure that today's operation does not significantly disrupt operations at Nicha I understand that every current Nicha employee charged in this takedown will be suspended effective today and Nicha has lined up the necessary resources to fill those roles to avoid any disruption in services to Nicha residents and last but not least I want to commend the outstanding career prosecutors from this office who are handling this case Jerry Fang jaob fiddleman Meredith Foster kathern go and sheb SWAT and their supervisor Morin Comey and Robert soberman the chiefs of the public corruption unit here at SNY it's not my pleasure to turn the podium over to the commissioner of the New York City Department of investigation Joselyn straber thank you Damen first I want to recognize the team of assistant us attorneys and their supervisors our federal law enforcement Partners at Homeland security investigations and the offices of the inspectors general for the Department of Housing and Urban Development and for the Department of Labor for their work on this important investigation and I want to thank the New York City Housing Authority senior leadership for its prompt and extensive cooperation in this matter I also want to recognize the inspectors the investigators and supervisors at doi's office of the Inspector General for the New York City Housing Authority who have worked tirelessly on this investigation and brought us here today confidential inv investigator Karen Smith special investigator deline doer assistant inspector's General Neo Ben cosme and Robert Joyce Deputy Inspector General Gregory dor and Inspector General Ralph ianuzi the complaints unsealed today are striking both in number and in the conduct alleged that Nicha superintendant assistant superintendant and others responsible for the care and maintenance of public housing a scarce resource in this city allegedly use their positions of public trust and responsibility to solicit and receive bribes from Nicha vendors as a cost of doing business over 2 million in bribe payments in total the 70 current and former Nicha staff members charge today in separate bribery schemes touch every burrow of New York City and nearly onethird of nich's 335 housing developments the bribery and extortion that is charged here allegedly exploited the no bid process for goods and services under $10,000 commonly referred to as micro purchases that process was intended to ensure Swift completion of necessary lower cost construction and maintenance in the Nicha developments the conduct as alleged drove up the cost of this kind of work and diverted valuable public funds away from public housing and into the pockets of corrupt Nicha staff as in all DOI investigations where misconduct is identified and particularly where as here the conduct is alleged to be widespread DOI considers the policy and procedural changes that can prevent similar fraud or corruption in the future to that end DOI has issued 14 recommendations and on this effort I am particularly thankful for the partnership of Lisa Bova Hyatt Nicha CEO who has committed to make these reforms doi's recommendations will be on our website and we have copies of them with us here today they focus on reform of the micro purchase process to protect it from abuse while maintaining efficient service for Nicha residents Improvement of controls and oversight of that process and education for Nicha employees and vendors our recommendations include transferring responsibility for micro purchases from development level staff to a centralized procurement unit with necessary expertise standardizing micro purchase costs by establishing a cost schedule for typical services with excess costs to be explained in writing by the vendor and approved in writing prior to the commencement of the work by The Neighborhood administrator who manages staff at several developments requiring review by Nicha staff outside the development of documentation of completed work for all micro purchases prior to processing payments to vendors and I want to note that the three recommendations that I just mentioned were previously made to Nicha and ultimately were not implemented mented um and like I said Nicha has committed to implement the recommendations that we are issuing today uh additionally we recommend creating a pre-qualified list of vendors that must be used for micro purchases following a vendor Integrity review process to be developed jointly by DOI and Nicha and requiring that all Nicha staff involved in the micro purchase process attend DOI anti-corruption training on City's employees mandated duty to report corruption and illegal bribery and gratuities thank you good morning my name is Ivan arell I'm the special agent in charge for Homeland Security investigations New York and I am proud to be standing alongside my steam law enforcement colleagues we are here to announce indictments of a less pervasive corruption among employees of the New York City Housing Authority today our agents have executed 65 arrests in Six States and throughout New York including all five burrows this offend and stand accus of bribery and extortion among a range of other charges this they are alleged to have operated similarly to an organized crime Network demanding accepted gigbags and bribes for access to no bit contracts and lucrative under the table de New York City is the land of opportunity for over 8 million people affordable housing made such aspirations possible for those who might otherwise be unable to call at home n shall provides a place to live for an estimated one in 17 New Yorkers roughly half a million Big Apple residents spend their days pursuing the American dream restor head and night within any of the 335 Nicha complexes the Nicha superintendent arrested today are accused of abusing their power and their access to federal funds to instead gain money and influence Tom and Tom again this offenders allegedly enriched themselves at at the expense of nicho residents and the contractors who were pursuing the real American Dream by lining their own Pockets through this illegal back door deals perhaps the most impacted in these cases were the over 200,000 Nicha residents who lived in the complexes affected by these alleged crimes these victims may have been cheated out of better services and programs meant to improve their lives because the superintendents were allegedly more interested in a secret payoff than finding the best value for Nicha this investigation span more than a year it was a product not only of collaboration among close Partners but of long days and sleepless nights for countless special agents analysts and Task Force officers today historic announcement would not have been possible without the dedicated team that makes up the HSI New York's document and benefit fraud task force a specialized group of agencies that include the US Department and of Housing and Urban Development Office of the Inspector General the New York City Department of Investigations the US Department of Labor Office of the Inspector General and the United States attorney's office for the southern district of New York as one of our largest investigative agencies the public can rest assure we at Homeland Security investigations will pursue all avenues of justice for the people of this great City make no mistake the American dream is alive and well here and we pledge to do whatever we can to make sure that doesn't change thank you good morning as the Inspector General for the US Department of Housing and Urban Development I am proud to join this group announcing the unsealing of charges against 70 current and former New York City Housing Authority superintendents who have allegedly exploited the trust placed in them by the citizens of New York City the residents living in Nicha housing and the American taxpayers I want to thank our law enforcement partners that contributed to these arrests including us attorney Williams his outstanding group of prosecutors as well as Homeland Security investigations the New York City Department of investigation and my colleagues at the Department of Labor Office of the Inspector General HUD supports Nicha with over 1.5 billion dollar each year to support one in 17 New Yorkers with the housing assistance that they need my office is initiating an audit of nicha's efforts to ad identify combat and prevent corruption and fraud we will make recommendations that will assist Nicha in promoting an overall culture that is anti- frud fraud and the failure to identify the risk of fraud stands in the way of the ultimate success of these most important Housing Programs my office is determined to help the department and public housing authorities remain Vigilant and develop tools they need to guard against this type of corruption this payto playay bribery schem SCH alleged in the complaints unsealed today waste millions of dollars and risk residents staying in unacceptable living conditions the alleged harm harms the alleged conduct harms the effectiveness of housing programs that support more than 200,000 Nitro residents this conduct also poses a significant risk to the integrity and reputation of the HUD rental assistance program here in New York City and throughout the country and this conduct ultimately erodes the trust of Nitro residents and all beneficiaries of Huds programs in addition to this targeted audit work that I'm announcing here today we'll continue to prioritize oversight and Partnerships that enhance quality living conditions for those living in HUD assisted housing and our team of hudig law enforcement agents will continue to work cases like this one in hopes of deterring and eliminating corruption in Huds important Housing Programs thank you again to us attorney Williams HSI DOI and labor oig for your leadership and commitment to Pro Prosecuting this case I also want to thank our investigative team at HUD oig under the supervision of acting special agent in charge Janine Rushlow and retired special agent in charge Christina scaringi for their hard work and truly tireless efforts in bringing these charges thank you okay we can take some questions hi Kimberly from Channel 7 four questions four questions yeah quickly um you said the investigation was about a year but do we have an idea of how far back and how long this was going on an idea of the average amount these assistant supers and supers were getting um and in terms of Nicha how are these people able to just freely do this it sounds like there was no oversight and in terms of the work done you said that the conditions in the apartments like how did that affect people living was there was the paint you know the conditions okay so that's a lot um not everyone not everyone can have four um um so the conduct um that we allege kind of spans it's you know 70 different instruments so it's not all the same but the earliest conduct I think is from 2013 and spans until 2023 so up until very recently um in terms of the average dollar amount um you know a lot of these superintendant as we alleg were taking a portion of the total contract amount the contracts are relatively small so sometimes the cash payments would be you know $500 to $2,000 somewhere in that range um but of course it added up um given the the span of the of the conduct here to about $2 million and in bribes that were paid overall um obviously the commissioner U spoke to some of the reforms that are being put in place um I don't want to you know identify exactly where they went wrong I think we've identified that something did go massively wrong here given the fact that we have um you know charged 70 people with this conduct um but going forward um there are hosts of reforms that the commissioner laid out that hopefully Nicha will be adopting um to make sure this doesn't happen again in terms of the impact on the residents you know um the work that uh that was contracted to be done was done um uh that's what we have we have found um but again that doesn't mean that this is a crime without a harm you know the taxpayers of the city people's faith in government um you know when you see this kind of conduct um it roads public trust in a way um that's really sad and we're already in a time where public trust is low enough um okay next question next from the cting I think this is a Jos question okay a not offended at all so you said that you guys had made recommendations before those three recommendations that you just spelled out which go to the heart of this thing when did you do that why did you do it and when did this particular investigation start those recommendations that I referred to uh were made in September of 2021 uh as you know there were other recommendations you know over the years made to the procurement process but the specific ones that I mentioned September of 2021 um they were made in connection with actually a case that was brought uh in Brooklyn uh with the Brooklyn DA's office uh charging nine contractors with misconduct in connection with the micr purchase process um and in terms of the beginning of this investigation I can't give you a precise date but the well we we have brought we brought federal charges in 2022 against two Nicha uh superintendent that was also um pretty well covered um and we have been investigating uh non-stop since then Pix 11 please speak in hi Henry rossof Pix 11 uh is work okay um we heard you praise several of you Nicha leadership but to put a fine point on this does any of this alleged corruption extend into the senior ranks of n leadership or the Adams Administration and in addition do any of the contractors or supers or assistant supers have a Nexus to your investigation into the mayor's campaign finances so let me just answer the question that I can't answer which is no it doesn't um touch the senior leadership of Nicha what we have alleged as misconduct by the superintendant or assistant superintendant um those are the schemes that we've alleged and we've alleged nothing more next question Lisa Evers Lisa Evers Fox 5 Mr Williams do you have any indication that these bribery schemes extended into some of the major contractors like the ones that were being called in to do mold repair remediation or fixing the leaky roofs that many of the residents have had to deal with over the years so I'm not able to get into that you know everything that we're able to say in terms of who the contractors are are contained in our charging instruments or in our public statements that we'll be making in court so I can't give you more information than that but the investigation ongoing obviously it is we never stop next question Eric kki ABC so for 10 years there's been this endemic corruption u in in Nicha are these Federal char just because it's a feder because of federal oversight can you explain a little bit about how that how that works well look I mean I think what it what is it we we have not this is not the first case that's been brought alleging this type of corruption in Nicha Joselyn mentioned a case of the Brooklyn da brought um back in 2021 we obviously brought a case in 2022 um what we have found is that the conduct has continued and that is absolutely unacceptable and so we um you know here at this office with with our law enforcement Partners really leaned in dedicated the resources necessary to do this kind of sweeping um takeown that we hope we send a message and make sure that you don't find us back at a Podium like this again announcing more charges like this that's why I said that the culture of corruption at Nicha needs to end today next question hi Jennifer with CBS does this investigation toop at 70 could there be more uh of these superintendent assistant superintendant that can we can see face charges down the line are you looking into more Nicha buildings and properties we are absolutely continuing the investigation that's why I you know issued the call for people to come forward if there are contractors who are paying bribes who have paid bribes to Nicha employees and have not yet spoken to us we strongly encourage them to come forward now if you are a Nicha employee who has demanded or received a bribe they have an obligation under the law law to report it to DOI um they should do that um and any Resident who is aware of this kind of conduct should also feel comfortable coming forward it's really important that we put a stop to this once and for all next question thanks last question Ben kachman hey um I think Greg should get a question uh after but um okay these recommendations were allegedly imp um made in September 2021 what has been going on uh from then until now why have they not been implemented and is basically now that there's indictments suddenly they're going to change well I'm gonna look to Joselyn to take this one I can't speak to precisely the rationale for the failure to implement the recommendations we previous ly made what I can say is that there were reforms made to the micro purchase process they in our view did not go far enough and I think the fact that we're here today shows that they did not go far enough and yes I think what has what has happened today will be tremendously impactful and our hope uh as the US attorney said is that this will put a stop to this Nicha has committed to implementing the reforms that we are currently recommending and uh we're optimistic that they will do so thank you yeah can you ask um I I'm just reading this and I'm trying to think so this stuff's going on and you guys there's a there's a DA and then you guys did the two guys in the elevator uh in 2022 um and so everybody knows this is going on I mean it's and obviously it's going on everywhere what triggered this organized effort to try to put it all together in one place and I think that's yeah so what triggered it is because this is classic bread and butter sdny um worked with our law enforcement Partners um you know it's kind of oldfashioned um dig dig dig and um you know put things together as you find it the a USA's here um up here there a number of them I think it's an unusual number because this is unusual case our public corruption unit is always thinking about ways that they can bring impactful cases um and if it requires more resources we add more resources to get it done um we were trying to send a message with a 70 uh uh person takedown a message that can't be missed by anyone out there who thinks that this behavior is acceptable or will be tolerated right here right now they should know that it won't be um so that's why we do what we do that's why we're announcing these actions today and again I hope um this finally puts an end to this culture of corruption in the micro uh contract process at Nicha all right thank you [Music] everyone [Music] [Music]

Channel: Eyewitness News ABC7NY

Views: 23,404

Keywords: abc7ny, wabc-tv, eyewitness news, 7online, wabc eyewitness news, nycha, arrests, federal investigation, nyc, new york city, housing authority, nycha arrests

Id: P7aN-0TU6Uc

Length: 23min 45sec (1425 seconds)

Published: Wed Feb 07 2024