Monday, October 19, 2020

Senior Executive Of Venture Capital Funds Pleads Guilty In Manhattan Federal Court To Securities And Wire Fraud


 Audrey Strauss, the Acting United States Attorney for the Southern District of New York, announced today that MARC LAWRENCE pled guilty to securities fraud and wire fraud in connection with his role as a senior executive of a number of corporate entities (collectively referred to as “Downing”) that were operated as a Ponzi-like scheme.  LAWRENCE solicited millions of dollars from Downing investors through materially false and misleading statements regarding, among other things, Downing’s use of investor proceeds, sources of funding, financial condition and ability to pay salaries to employee-investors, and portfolio companies.  LAWRENCE pled guilty before U.S. District Judge Alvin K. Hellerstein.  LAWRENCE’s co-defendant, David Wagner, the chief executive officer of Downing, previously pled guilty to securities fraud and wire fraud before Judge Hellerstein on September 21, 2020.

Acting Manhattan U.S. Attorney Audrey Strauss said:  “As he admitted in court, Marc Lawrence and his co-defendant swindled employee-investors of their purported venture capital firm.  They fraudulently induced employee-investors to hand over more than $8 million that was supposed to be invested in profitable business operations.  The firm was a sham, and employee-investor funds were used to pay personal expenses or pay off other investors in Ponzi-like fashion.  Now Lawrence awaits sentencing for his crimes.”

According to the Indictment filed in Manhattan federal court:

From at least in or about December 2013 through at least in or about 2017, Wagner, the chief executive officer of Downing, and LAWRENCE, the president of several Downing entities, solicited investments in Downing, a purported venture capital firm that would invest in healthcare start-ups referred to as “portfolio companies” and provide sales, operations, and management expertise to the portfolio companies in order to bring their products to market and generate returns for Downing investors, who also worked for Downing (the “employee-investors”).  Wagner and LAWRENCE, and others acting at their direction, solicited more than approximately $8 million in investments in Downing from employee-investors located across the United States, including in the Southern District of New York, as a requirement of employment with Downing. 

After making the required investment of between $150,000 and $250,000 in Downing and starting their employment at Downing, employee-investors soon learned, among other things, that contrary to representations made by Wagner and LAWRENCE, and others acting at their direction, Downing did not have access to millions of dollars in funding, often could not make payroll, had virtually no products to sell, and employee investments were the overwhelming source of funding.  Employee-investors also learned that Wagner and LAWRENCE had misrepresented the companies in Downing’s portfolio, their product readiness, and ability to generate revenue.  While the particular formulation of these misrepresentations shifted over time, Wagner and LAWRENCE systematically sought and obtained employee-investor money through materially false and misleading statements.

Beginning in or about May 2016, after several employee-investors had brought lawsuits against Wagner, LAWRENCE, and several Downing entities alleging claims based on, among other things, fraud, Wagner and LAWRENCE continued the scheme by recruiting employee-investors into a new company called Cliniflow Technologies, LLC (“Cliniflow”), through materially false and misleading statements about Cliniflow’s cash reserves, portfolio companies, and exposure to litigation.  In fact, Cliniflow purportedly held majority ownership in the same primary portfolio company as other Downing entities and was simply a new name used by Wagner and LAWRENCE to solicit investments from new employee-investors that was not tainted by the lawsuits filed against Downing entities.  A majority of the over $1.5 million raised by Wagner and LAWRENCE through Cliniflow was transferred to other Downing entities and used to pay for, among other things, Wagner’s personal expenses and the repayment of prior investors.

LAWRENCE, 66, of St. Petersburg, Florida, pled guilty to two counts of securities fraud and one count of wire fraud, each of which carries a maximum sentence of 20 years in prison.  The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.  As part of the plea agreement with the Government, LAWRENCE agreed to forfeit $150,000 in United States currency and pay restitution of $4,550,000 to victims of his criminal conduct.  

LAWRENCE will be sentenced by Judge Hellerstein on February 1, 2021, at 2:30 p.m. 

Ms. Strauss praised the outstanding work of the Federal Bureau of Investigation, and thanked the U.S. Securities and Exchange Commission and the Enforcement Section of the Massachusetts Securities Division for their assistance in the investigation. 

Governor Cuomo Updates New Yorkers on State's Progress During COVID-19 Pandemic - OCTOBER 19, 2020


Statewide Positivity Rate is 1.21 Percent

Positive Testing Rate in Hot Spot Areas is 3.31 Percent; New York State Positivity Without Red Zone Focus Areas Included is 1.13 Percent

14 COVID-19 Deaths in New York State Yesterday

Expanded Community Testing Continues This Week In Southern Tier, Western New York Counties Along PA Border  

 Governor Andrew M. Cuomo today updated New Yorkers on the state's progress during the ongoing COVID-19 pandemic.

"New York has one of the lowest positivity rates in the nation, but cases are rising across the nation. When we put our infection rate in context, we're doing well - and we're doing well because we're aggressive when we see hot spots. Our micro-cluster approach for the fall targets outbreaks sooner, and with a targeted focus," Governor Cuomo said. "We all hope the winter will be the season of the vaccine, but administering the vaccine will be the largest operational challenge we've faced since this began, and we need the federal government to step up. In the meantime, we all need to work to maintain our progress by continuing to wear our masks, wash our hands, remain socially distant and above all, stay New York Tough."

The Governor updated New Yorkers on the State's response to COVID-19. In "Red Zone" focus areas included as part of the Governor's Cluster Action Initiative, the positivity rate for test results reported yesterday is 3.31 percent - up from 3.19 percent the day before.

Within the "Red Zone" focus areas, 3,016 test results were reported yesterday, yielding 100 positives or a 3.31 percent positivity rate. In the remainder of the state, not counting these "Red Zone" focus areas, 78,993 test results were reported, yielding 898 positives or a 1.13 percent positivity rate. The state's overall positivity rate is 1.21 percent with focus areas included. The "Red Zone" focus areas are home to 2.8 percent of the state population yet had 10 percent of all positive test results reported to the state yesterday.

Today's data is summarized briefly below:

  • Patient Hospitalization - 934 (+21)
  • Patients Newly Admitted - 98
  • Hospital Counties - 41
  • Number ICU - 198 (-2)
  • Number ICU with Intubation - 106 (+4)
  • Total Discharges - 78,442 (+80)
  • Deaths - 14
  • Total Deaths - 25,659

Councilwoman Vanessa Gibson and 12th City Council Candidate Coop-City Food and Reusable Bag Giveaway


The Metropolitan Council donated three-hundred boxes of food, and reusable shopping bags with a face mask and small bottle of spray hand sanitizer was provided by Empire Health Plan and more reusable bags by the Department of Sanitation.

Term Limited Councilwoman Vanessa Gibson has announced her intention to run for Bronx Borough President in 2021 when current Bronx Borough President Ruben Diaz Jr. is term-limited out of office. Kevin Riley, an aide in Assemblyman Carl Heastie's office, is running in the December 22nd special election to fill the now vacant 12th City Council seat. 

Above - Councilwoman Vanessa Gibson and 12th City Council candidate Kevin Riley hold boxes of food for the next two people on line. 

Below - Councilwoman and announced Bronx BP candidate Gibson does her impression of the current Bronx BP putting a box of food in this person's wagon.

Above - The boxes of food waiting to be given out.

Below - The table with the reusable shopping bags to be given out.

Making NYC More Resilient: Public Review Begins for DCP’s Important Zoning for Coastal Flood Resiliency


Proposed zoning would make new construction more resilient to disasters, including today’s COVID-19 pandemic; allow for better and faster building repairs; ensure seniors in nursing homes are better protected   

 City Planning Commission (CPC) Chair Marisa Lago today announced the start of public review for Zoning for Coastal Flood Resiliency (ZCFR), newly proposed citywide zoning rules that would result in buildings that are better able to withstand and recover from major disasters and sea level rise and which will also translate to lower flood insurance costs.

“As we near its eight-year anniversary, Hurricane Sandy continues to serve as a painful reminder that we must continue to adapt to the ever-so-real threats of climate change. This includes updating our zoning to help New Yorkers build, and rebuild, more resiliently. This new zoning makes floodproofing in New York City’s neighborhoods much easier, whether you’re building a new home or apartment building, expanding your business, or simply elevating your boiler,” CPC Chair Marisa Lago said. “This new zoning also provides needed flexibility to address all types of future disasters, whether another climate event or today’s COVID-19 pandemic.”

ZCFR reinforces one of the most important lessons from Hurricane Sandy: Strong building codes make a big difference.

Currently, buildings are restricted by zoning regulations that do not take resiliency into account and thus force New Yorkers to choose between interior space and resiliency improvements. ZCFR will make it easier for buildings to meet or exceed modern resiliency codes without sacrificing their basement, for example, by adding some much-needed zoning flexibility.

Critically, the proposal will limit construction of new nursing homes in high-risk areas because of their vulnerable residents.

New York City has 520 miles of coastline, making many neighborhoods vulnerable to flooding during storm events and sea level rise. The proposed rules cover an area that is home to 800,000 New Yorkers, more people than live in Boston and two times as many as in New Orleans. Because the proposal is a citywide text amendment, all 59 community boards and all five borough presidents are required to weigh in on the proposal.

DCP is also releasing Floodplain by the Numbers, a report highlighting the long-term recovery progress and resiliency challenges facing the City’s diverse waterfront communities, including the fact that homes built prior to flood-resistant codes suffered higher average costs more than double those constructed to modern resiliency standards. 

ZCFR would improve and make permanent resilient zoning provisions initially put in place to help the City recover from Sandy. Since 2016, planners at the Department of City Planning (DCP) have spoken with about 3,000 New Yorkers at more than 225 events, including with elected officials, community boards, civic associations, non-profits, architects and engineers, garnering ideas and feedback from the public to develop and strengthen the proposal.

 The proposal’s four main goals:

·         Encourage resiliency in the current and future floodplain: ZCFR would expand the area where flood resilient zoning provisions apply, so that buildings in both the City’s 1% annual chance floodplain and 0.2% annual chance floodplain, those areas of New York City that, by 2050, are also expected to have a 1% chance of a flood event in any given year, can meet or exceed the flood-resistant construction standards set by FEMA or NYC’s Building Code. This expanded floodplain increases the number of buildings that could be retrofitted to resiliency standards by nearly 50%, allowing building owners throughout the City’s floodplain to proactively raise living space and important equipment out of harm’s way.


·         Support long-term resilient design of all building types: Flexible zoning would allow building owners to raise habitable spaces and other building support features above expected flood elevations, without causing poorly designed, tall and narrow structures that don’t match neighboring homes. Regulations would incentivize active uses to be kept at the sidewalk level, and floodproofed ground floors with improved streetscapes.


·         Allow for adaptation over time through incremental retrofits: ZCFR would allow buildings to elevate or relocate important mechanical, electrical and plumbing equipment, or backup systems like generators, above the expected height of floodwaters. This can be done either within the building, atop of the structure, or on a separate platform.


·         Facilitate future recovery by reducing regulatory obstacles: As seen by the COVID-19 pandemic, disasters arrive in all forms. Rather than writing new emergency provisions each time a crisis strikes, ZCFR would place recovery provisions in the Zoning Resolution, so they can be quickly selected based on the issues caused by the disaster and recovery period. These provisions include cutting down on red tape and paperwork, and allowing additional time for an affected, grandfathered business to reopen, even if it doesn’t conform with current zoning. 

In parts of the City that fall within the 1% floodplain, ZCFR would limit the siting of new nursing homes to lessen both the health consequences and logistical challenges of evacuating this particularly vulnerable population. Existing nursing homes in the floodplain can build enlargements of up to 15,000 square feet, allowing for modest improvements like resiliency measures. 

Through these changes, ZCFR expands temporary rules that were adopted by the City in 2013, months after Sandy. The temporary rules are set to expire one year after FEMA’s new flood maps are released, likely in 2024. 

“Most of New York City’s homes and buildings were constructed at a time when we knew far less about the threats posed by flooding,” said Jainey Bavishi, Director of the Mayor’s Office of Resiliency. “These new, more flexible rules were designed with climate change in mind and will make it easier for New Yorkers to strengthen their buildings with resiliency retrofits. We encourage all New Yorkers to learn more about their flood risks at and to enroll in flood insurance.” 

“We’ve seen firsthand the devastating impact climate change can have on our City’s coastal communities,” said Department of Buildings Commissioner Melanie E. La Rocca. “We commend the Department of City Planning for proactively working to help New Yorkers in flood-prone neighborhoods better protect their homes and livelihoods.”

In addition to ZCFR, DCP is also starting public review for zoning changes in three neighborhoods as part of DCP’s Resilient Neighborhood Initiative – Gerritsen Beach and Sheepshead Bay in Brooklyn, and Old Howard Beach in Queens. These actions address resiliency challenges that are specific to the conditions found in these areas:

In Gerritsen Beach, zoning changes, including the establishment of a new Special Coastal Risk District, are proposed to limit future density and cap building heights at 25 feet above the flood elevation to more closely match the area’s built character.

In Sheepshead Bay, the existing Special Sheepshead Bay District would be updated to align it with ZCFR and prohibit below-grade plazas, which are especially prone to flooding.

In Old Howard Beach, zoning changes are proposed to limit the construction of attached homes, which are harder to retrofit and elevate than detached homes because of their shared walls. 

“We applaud the Department of City Planning for proposing these zoning changes that will increase community resiliency and save homeowners money on their flood insurance premiums,” said Christie Peale, CEO/Executive Director for the Center for NYC Neighborhoods. “These progressive changes will remove obstacles to neighborhood resiliency, not only for homeowners and their tenants who are currently at risk of flooding, but also for communities that will face additional flood risk by 2050. We are also gratified that this forward-looking framework will allow for flexible zoning to allow homeowners to retrofit their properties in a manner that maintains neighborhood integrity.”


The launch of the seven-month public review process starts the clock for ZCFR, as well as the three neighborhood-specific actions. ZCFR will go to all 59 Community Boards for review, followed by the five Borough Presidents and Borough Boards. The three neighborhood-specific actions will only go before their respective local Community Boards and Borough Presidents. ZCFR and the three local actions will then go to the City Planning Commission for a public hearing and vote, followed by the City Council.

Department of City Planning
The Department of City Planning (DCP) plans for the strategic growth and development of the City through ground-up planning with communities, the development of land use policies and zoning regulations applicable citywide, and its contribution to the preparation of the City’s 10-year Capital Strategy. DCP promotes housing production and affordability, fosters economic development and coordinated investments in infrastructure and services, and supports resilient, sustainable communities across the five boroughs for a more equitable New York City.

In addition, DCP supports the City Planning Commission in its annual review of approximately 450 land use applications for a variety of discretionary approvals. The Department also assists both government agencies and the public by advising on strategic and capital planning and providing policy analysis, technical assistance and data relating to housing, transportation, community facilities, demography, zoning, urban design, waterfront areas and public open space.


We Stay/Nos Quedamos is proud to announce the completion and release of the South Bronx Land and Community Resource Trust (SBxLCRT) Study, a blueprint and action plan for the formation of a community-led land trust held in the public interest in the Melrose section of the South Bronx.

 At the core of SBxLCRT is a modular strategic plan for long-term community land ownership that mitigates housing anxiety in the region, and creates much-needed Resiliency Hubs that facilitate essential resources and services before, during, or after a natural hazard event or emergency.

The plan forward also provides for the incremental community-wide expansion of technological resource such as low-cost broadband and solar capacities that dovetail seamlessly with Nos Quedamos' partnership with Governor Cuomo on the Downtown Revitalization Initiative (DRI).

Building on previous research and development work, the 12-month study was led by Nos Quedamos in partnership with Hester Street, who was the study's primary technical assistance provider, and NYC Mayor's Office of Environmental Remediation (OER). SBxLCRT is the organic next level to Nos Quedamos' historically innovative and precedent-setting Melrose Commons Urban Renewal Plan



Cummings for Congress - Claims - AOC CAUGHT IN A LIE




  Representative Alexandria Ocasio-Cortez, who has previously made hay out of her opponents' refusal to debate her, refuses to debate her opponent, former NYPD officer and high school civics teacher John Cummings. Worse, in making excuses for not debating, she has been caught in a lie.

The Locust Point Civic Association invited the Congresswoman and Cummings to a debate hosted on October 6th. Rep. Ocasio-Cortez refused to attend, stating that she was "not doing any in person campaign events" through Election Day. Yet this past Friday she attended a meeting in person in Morris Park.

Cummings Campaign Manager, Chapin Fay said, "We always knew the Socialist Congresswoman who lives in a luxury building in Washington, DC was a hypocrite, but now everyone knows she's a liar. The people of the Bronx and Queens deserve better. People are struggling and they deserve to hear how each candidate in the race to represent them in Congress will make their lives better. They deserve a debate. What's the Congresswoman afraid of?"

The Cummings campaign sent a letter to Rep. Ocasio-Cortez on September 28th outlining a proposed series of debates. The Congresswoman has yet to respond to the campaign's debate challenge.

Born and raised in Parkchester, John Cummings followed in his father's footsteps and was sworn in as a New York City Police Officer in 1983. Initially assigned to NSU (Neighborhood Stabilization Unit) 7, in the South Bronx, which covered the 40, 42, 44, and 48 precincts, he was then assigned to the 46th precinct, where he remained for 2 years. He was later assigned to the NYPD Harbor Unit, where he served first as an operations coordinator in the Bronx, and then as a member of the Harbor George unit in College Point, Queens. John suffered a serious knee injury in the line of duty, and was forced to retire in July 1991, and did so with multiple commendations for bravery and excellence in the line of duty.

Returning to his alma mater, Saint Raymond High School for Boys, John taught History and Government for over 20 years. He also served as the Alumni Coordinator, Director of Development, the History Department Chairperson, and the Recruiting Coordinator. John also served as the cantor at school Masses, held on Catholic Holy Days of obligation.

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 Mayor Bill de Blasio today appointed Melanie Hartzog as Deputy Mayor for Health and Human Services and Jacques Jiha as Director of the Mayor’s Office of Management and Budget. Hartzog previously served as Budget Director and Jiha served as the Commissioner for the New York City Department of Finance. As Deputy Mayor for Health and Human Services, Hartzog will guide the City’s response to the ongoing COVID-19 pandemic and ensure the City’s social services continue to support every New Yorker, especially those experiencing homelessness. As Budget Director, Jiha will help lead New York City out of the fiscal crisis brought on by the COVID-19 pandemic by making fiscally responsible decisions that will strengthen and protect the City’s finances for generations to come.

“I am pleased to appoint two of our City’s most hard-working and passionate public servants to take on even bigger roles as we continue to respond to the COVID-19 pandemic,” said Mayor Bill de Blasio. “Melanie and Jacques have the experience and vision necessary to support New Yorkers during this crisis and guide our City through financial hardship. Thanks to them, New Yorkers can expect an even brighter future.”


“From fighting to improve the lives of low-income children to balancing the city’s budgets while funding Universal Pre-K, I have spent my entire career uplifting our city’s most vulnerable,” said Deputy Mayor for Health and Human Services Melanie Hartzog. “The COVID-19 pandemic has underscored the importance of public health in our city’s recovery, including a robust social services sector. I thank Mayor de Blasio for the opportunity to continue to serve on behalf of 8.6 million New Yorkers.” 


“Our city is facing an enormous fiscal challenge in light of the public health crisis. As we recover, I am committed to making fiscally responsible decisions to keep New York City a vibrant place to live and work. Serving as Commissioner of the Department of Finance has been the honor of a lifetime, and I thank Mayor de Blasio for entrusting me to continue to serve New Yorkers as Budget Director,” said Budget Director Jacques Jiha.


About Melanie Hartzog:


Melanie Hartzog previously served as the Director of the Mayor’s Office of Management and Budget, where she oversaw the largest municipal budget in the United States, responsible for funding all city programs and services for New Yorkers. Before joining the Office of Management and Budget, Hartzog served as Executive Director of the Children’s Defense Fund. Previously, she served as Family Services Coordinator for the Deputy Mayor for Health and Human Services and Deputy Commissioner of the Administration for Children’s Services. She also led a social services unit in the Mayor’s Office of Management and Budget, and was Director of Policy and Advocacy for the Human Services Council of New York City, Inc.


Hartzog holds a Master of Science degree from the New School’s Milano School of International Affairs, Management and Urban Policy and Bachelor of Arts from Eckerd College. She lives in Brooklyn with her husband and three children.


“Mel has been an extraordinary leader in government and in the not-for-profit advocacy community for many years, and we have worked together both in and out of government to expand and improve services for low-income New Yorkers, particularly children.  She will be an outstanding Deputy Mayor for Health and Human Services and I look forward to working with her to make sure that the most vulnerable residents of our city have access to the social services they need in these unprecedented times,“ said Steven Banks, the Commissioner of the Department of Social Services.


“Citizens’ Committee for Children of New York extends profound appreciation to Ms. Melanie Hartzog for years of steady stewardship of the Mayor’s Office of Management and Budget and we wish her well as she takes on the role of Deputy Mayor for Health and Human Services.  Ms. Hartzog is incredibly well positioned to work successfully across the sector with colleagues inside and outside of government. CCC stands ready to partner with her as the strength of health and human service agencies, community based partners and workforce, and the New Yorkers depending on their care are essential to the City’s pandemic recovery efforts,” said Jennifer March Ph.D., Executive Director, Citizens’ Committee for Children of New York.


About Jacques Jiha:


In 2014, Mayor de Blasio appointed Jacques Jiha as the Commissioner for the NYC Department of Finance, the agency responsible for collecting over $40 billion in revenue that make all city services possible. As Commissioner, Dr. Jiha modernized the Department by integrating new technology and data analytics to increase efficiency and make better decisions. Under his leadership, the Department also created new options focusing on customer experience, including a full-service call-center, online property tax system, parking ticket mobile app and the offices of the Taxpayer Advocate and Parking Summons Advocate. Prior to becoming commissioner of the Department of Finance, Dr. Jiha was the chief operating officer and chief financial officer of Earl G. Graves, Ltd/Black Enterprise. Previously, he served as deputy comptroller for pension investment and public finance in the Office of the New York State Comptroller, deputy comptroller for Nassau County, chief economist for the New York City Office of the Comptroller, executive director of the New York State Legislative Tax Study Commission, and principal economist for the New York State Assembly Committee on Ways and Means.


Born in Haiti, Dr. Jiha immigrated to New York City in 1979 and earned his bachelor’s degree in economics from Fordham University. He also holds a Ph.D. and a master’s degree in economics from the New School for Social Research. He lives in Queens with his wife and daughters.