NEWS FROM CONGRESSMAN ELIOT ENGEL

Engel Cosponsors Bill to Increase Affordability & Undo the Administration’s Sabotage of the ACA

  Congressman Eliot Engel, a top member on the House Energy and Commerce Committee that oversees health policy, has cosponsored a comprehensive bill that would improve the Affordable Care Act (ACA) marketplaces by making health care more affordable and reversing the harmful Trump Administration actions that have sabotaged the ACA. 

The legislation would lower health care premiums for consumers by eliminating the cap on eligibility for premium tax credits, and would increase the size of the tax credit for all income brackets. The bill would also provide additional support for out-of-pocket costs, and would make cost-sharing subsidies more generous for those below 250 percent of the Federal Poverty Line.  In October, President Trump decided to default on cost-sharing subsidies that help more than seven million hardworking Americans afford their out-of-pocket health care costs.

“For the last year, Republicans have worked incessantly to destroy or, at the very least, undermine the Affordable Care Act,” Engel said. “I’m proud to support comprehensive legislation that strengthens our nation's health care system by reducing costs, improving access to care and undoing some of the most harmful Trump Administration policies that sabotage the ACA.”

The legislation, entitled the Undo Sabotage and Expand Affordability of Health Insurance Act of 2018, also reverses harmful actions by the Trump Administration that undermine consumer protections in the health care system.  Specifically, the bill would:

• Prevent the expansion of Association Health Plans from going into effect. These bare-bones plans are not required to include protections for people with pre-existing conditions or the Essential Health Benefits (EHBs) package.
• Prevent the Trump Administration from moving forward on a proposed rule that would allow insurance companies to discriminate against people with pre-existing conditions by offering junk plans that provide limited benefits and little financial protection from health care costs.  The legislation would require these short-term limited duration health plans to play by the same rules as ACA-compliant plans.
• Prevent the Trump Administration from weakening protections for EHBs, which would leave consumers with less comprehensive plans that may not cover needed services, such as prescription drugs, maternity care, and substance use disorder treatment.

The legislation would also restore marketing and outreach funds that were cut by 90 percent during the 2018 ACA open enrollment period.  Specifically, the bill requires the Department of Health and Human Services to conduct marketing and outreach, and provides $100 million per year from 2019 through 2021.  It also provides $100 million in Consumer Assistance Program grants for states, which delivers funding for states to conduct educational activities regarding health insurance, and creates a state innovation fund to empower states to implement new approaches to increasing enrollment.  Lastly, this legislation creates a national reinsurance program to help stabilize the market and alleviate potential premium increases resulting from sabotage of the ACA.

Engel Joins Student from NY-16 to Protest Gun Violence During National Walkout Day

   Congressman Eliot Engel, a member of the House Gun Violence Prevention Task Force, was proud to join constituent Caroline Kirby at the U.S. Capitol on Wednesday to participate in National Walkout Day, a day when students across the country walked out of school to protest gun violence. Kirby, who attends Bronxville High School in New York’s 16^th Congressional District, was one of thousands of students across the country who participated in today’s event, which is intended to spur action at the federal level regarding commonsense gun reforms.

“I am so proud of Caroline and all the students from the Bronx and Westchester who today took part in National Walkout Day,”Engel said. “Their spirit and activism is inspiring and makes me very optimistic about the future of our country. We have a long way to go when it comes to sensible gun reforms, and with a Republican Majority in Congress it’s never easy to pass even the most basic measures, like universal background checks or raising the age to buy a firearm from 18 to 21. But as these young students are proving every day, the day of reckoning for groups like the NRA may finally be at hand.

“As a member of the Gun Violence Prevention Task Force, I will do all I can to continue to earn the lifetime F rating the NRA has given me for my voting record, by promoting commonsense gun reform in the House.”

Video of Congressman Engel and Ms. Kirby outside the U.S. Capitol can be found here.

Engel Statement On The Passing of Louise Slaughter

  "I am deeply saddened by the sudden passing of my dear friend, Louise Slaughter. Louise was a wonderful individual, an effective lawmaker, and true leader for us here in New York. A lifetime public servant, she gave herself fully to her constituents and worked relentlessly on their behalf. As a Member of Congress, Louise did remarkable work on a whole host of issues, and was the first woman to ever chair the Rules Committee. As a chair of the House Pro-Choice Caucus, she tirelessly led fights to protect women’s health and rights.

“But above all, Louise was just a fantastic person, warm and inviting to everyone she met. My condolences go out to her family—daughters Megan, Amy, Emily, her grandchildren and great grandchildren. Louise was beloved, and I'm going to miss hearing that great accent every day."

STATEMENT FROM MAYOR DE BLASIO ON THE PASSING OF TWO FDNY MEMBERS ON ACTIVE MILITARY DUTY

 “Today, we mourn the deaths of FDNY Lieutenant Christopher J. Raguso and FDNY Fire Marshal Christopher T. “Tripp” Zanetis, who were killed in an American military helicopter crash in Iraq on Thursday, March 15. They are truly two of New York City’s bravest – running into danger to protect and defend others, both in New York City and in combat overseas. On behalf of all New Yorkers, I extend my deepest condolences to their families, loved ones, and fellow service members and FDNY members.”

Joseph Percoco, Former Executive Aide And Campaign Manager To N.Y. Governor, Convicted Of Accepting More Than $300,000 In Bribes

Syracuse-Based Real Estate Development Executive, Steven Aiello, Also Convicted

  Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced that JOSEPH PERCOCO, the former Executive Deputy Secretary to the Governor of the State of New York, was convicted of soliciting and accepting more than $315,000 in bribes in return for taking official state action to benefit energy company Competitive Power Ventures (“CPV”) and Syracuse-based real estate developer COR Development (“COR”) after an eight-week trial.  STEVEN AIELLO, a COR executive, was also convicted of bribery conspiracy.      

U.S. Attorney Geoff Berman said:  “Joseph Percoco was found guilty of taking over $300,000 in cash bribes by selling something priceless that was not his to sell – the sacred obligation to honestly and faithfully serve the citizens of New York.  As every schoolchild knows, but he corruptly chose to disregard, government officials who sell their influence to select insiders violate the basic tenets of a democracy.  We will continue relentlessly to bring to justice those public officials who violate their oaths by engaging in this especially offensive misconduct.”         

According to the evidence introduced at trial, other proceedings in this case, and documents previously filed in Manhattan federal court:                                                                           

PERCOCO, who served as the Executive Deputy Secretary to the Governor between January 2012 and mid-2014, and again in 2015, abused his official position and extensive influence within the Executive Branch of New York State (the “State”) by seeking and accepting bribe payments from executives at companies that were seeking benefits and business from the State, in exchange for PERCOCO’s use of his official authority and influence to benefit those companies. 

PERCOCO solicited the bribe payments from executives at two clients of cooperating witness Todd Howe – CPV and COR – both of which had retained Howe as a consultant to help them obtain official State action.  In email correspondence between PERCOCO and Howe, PERCOCO and Howe referred to the bribe payments as “ziti,” a reference to a term for money used by the characters in the television show “The Sopranos.”

Bribes from CPV

PERCOCO, Howe, and others conspired for PERCOCO to receive more than $287,000 in bribe payments in exchange for PERCOCO’s official assistance for CPV on an as-needed basis. 

State action was critical to CPV’s business.  Starting as early as 2010, CPV provided personal benefits to PERCOCO, including expensive meals and a Hamptons fishing trip, in an effort to cultivate access to PERCOCO.  In response to CPV’s requests for official State assistance, PERCOCO, who was experiencing financial difficulties at the time, requested that CPV hire his then-unemployed wife. In or around the end of 2012, CPV executive Peter Galbraith Kelly Jr. created a position for PERCOCO’s wife that paid approximately $90,000 per year while requiring PERCOCO’s wife to do little work.  In exchange for these payments, PERCOCO agreed to use his official position and influence, and did in fact use his official position and influence, to help CPV with specific State matters as the opportunities arose. 

Among other things, PERCOCO agreed to use his official position and influence to assist the CPV’s efforts to obtain (i) a valuable agreement from the State allowing CPV to buy lower-cost emissions credits in New York for a power plant proposed to be built in New Jersey and (ii) a lucrative long-term power purchase agreement with the State guaranteeing a buyer for the power to be produced at a power plant proposed to be built in New York, which was expected to save CPV approximately $100 million in development costs.

CPV’s payments to PERCOCO’s wife were concealed in various ways to hide their true source.  For example, monthly payments to PERCOCO and his wife were made through a consultant who worked for CPV in order to disguise the source of the payments.  For his part, PERCOCO concealed the criminal scheme by failing to include CPV as the source of payments on his State-mandated financial disclosure forms. 

Bribes from AIELLO and the Syracuse Developer

Beginning in early 2014, PERCOCO was also paid bribes totaling approximately $35,000 from COR.  These bribe payments were orchestrated by AIELLO, the COR president.  AIELLO arranged for the payment of these bribes in exchange for PERCOCO’s official assistance for COR on an as-needed basis. 

Specifically, PERCOCO agreed to, and did, take official action for the benefit of COR to (a) reverse an adverse decision by the Empire State Development Corporation, which is the State’s main economic development agency, that would have required COR to enter into a costly labor peace agreement, (b) free up a backlog of more than $14 million in State funds that had already been awarded to COR but were delayed in payment, and (c) secure a substantial pay raise for AIELLO’s son, who worked in the Executive Chamber.

To disguise the nature and source of the bribe payments, COR’s bribes to PERCOCO were funneled through bank accounts and a shell company set up by Howe.

The jury was deadlocked on the charges against Kelly.  Joseph Gerardi, a COR executive, was acquitted of all charges.

PERCOCO is scheduled to be sentenced on June 11, 2018, and AIELLO is scheduled to be sentenced on June 14, 2018.  Both defendants will be sentenced by U.S. District Judge Valerie E. Caproni, who presided over the trial. 

A chart containing the names, ages, residences, counts of conviction, and maximum penalties for the defendants is attached.  The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by the judge. 

U.S. Attorney Berman praised the work of the Buffalo Field Office of the Federal Bureau of Investigation and New York Office of the Internal Revenue Service-Criminal Investigation, which jointly conducted this investigation with investigators from the U.S. Attorney’s Office.  Mr. Berman also thanked the New York State Attorney General’s Office.

DEFENDANT	AGE	RESIDENCE	CONVICTED CHARGE(S)	MAXIMUM SENTENCE(S)
JOSEPH PERCOCO	47	South Salem, NY	Conspiracy to Commit Honest Services Fraud, (Count Three and Four)   Solicitation of Bribes and Gratuities, (Counts Five)	20 years each         count                  10 years
PETER GALBRAITH KELLY, JR.	53	Canterbury, CT
STEVEN AIELLO	58	Fayetteville, NY	Conspiracy to Commit Honest Services Fraud	20 years
JOSEPH GERARDI	57	Fayetteville, NY

Statement Of U.S. Attorney Geoffrey S. Berman On The Conviction Of Joseph Percoco, Former Executive Aide And Campaign Manager To N.Y. Governor, And A Co-Defendant

  “Joseph Percoco was found guilty of taking over $300,000 in cash bribes by selling something priceless that was not his to sell – the sacred obligation to honestly and faithfully serve the citizens of New York.  As every schoolchild knows, but he corruptly chose to disregard, government officials who sell their influence to select insiders violate the basic tenets of a democracy.  We will continue relentlessly to bring to justice those public officials who violate their oaths by engaging in this especially offensive misconduct.”

U.S. Attorney Announces Suit Against The MTA And New York City Transit Authority For Failure To Make A Bronx Subway Station Accessible After A Full Renovation

  Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced today that the United States has filed a Complaint-in-Intervention (the “Complaint”) in a lawsuit, Bronx Independent Living Services v. Metropolitan Transit Authority, filed against the Metropolitan Transit Authority (“MTA”) and the New York City Transit Authority (“NYCTA”) to remedy violations of Title II of the Americans with Disabilities Act of 1990 (the “ADA”).  The United States’ Complaint alleges that the MTA and NYCTA violated the ADA when they altered the Middletown Road subway station on the number 6 line in the Bronx without insuring that the station was rendered readily accessible to and usable by individuals with disabilities, including individuals who use wheelchairs, to the maximum extent feasible.  Due to the failure to comply with the ADA, the Federal Transit Administration (“FTA”) concluded that it would not provide any funding for the cost of the renovation of the Middletown Road station.  The Complaint seeks declaratory and injunctive relief requiring MTA and NYCTA to install elevators at the Middletown Road station.

U.S. Attorney Geoffrey S. Berman said:  “There is no justification for public entities to ignore the requirements of the ADA 28 years after its passage.  The subway system is a vital part of New York City’s transportation system, and when a subway station undergoes a complete renovation, MTA and NYCTA must comply with its obligations to make such stations accessible to the maximum extent feasible.” 

The United States’ Complaint alleges that MTA and NYCTA violated the ADA by failing to install an elevator at the Middletown Road subway station serving the Pelham Bay neighborhood in the Bronx, despite spending more than $27 million on renovations of the station.  The renovations included replacing floors, walls, ceilings, and stairs leading to the street and platform.  Prior to beginning construction, the FTA and the U.S. Department of Transportation corresponded with MTA and NYCTA about their obligation to install an elevator at the station unless the MTA and NYCTA could demonstrate that it was technically infeasible to do so.  While that dialogue continued, and after the FTA had informed NYCTA that NYCTA’s analysis of the feasibility of installing an elevator was insufficient, MTA and NYCTA completed the renovation without installing an elevator and sought reimbursement from FTA for the cost of the renovation.  FTA ultimately concluded that it would have been technically feasible for MTA and NYCTA to install one or more elevators at the station.  As a result of MTA’s and NYCTA’s failure to install an elevator at the Middletown Road station, individuals with mobility impairments, including individuals who use wheelchairs, are unable to access the station. 

Mr. Berman thanked the FTA for its assistance with this matter.

DOI INVESTIGATION LEADS TO ARREST OF CITY CORRECTION DEPARTMENT EMPLOYEE FOR PROVIDING FALSE INFORMATION ABOUT GANG AFFILIATIONS ON EMPLOYMENT APPLICATION

  Mark G. Peters, Commissioner of the New York City Department of Investigation (“DOI”), announced today the arrest of a New York City Department of Correction (“DOC”) Legal Coordinator assigned to Trials and Litigations on charges of providing false and misleading information on her pre-employment application to become a Correction Officer (“CO”). DOI’s investigation revealed that BREANNE RILEY allegedly submitted several notarized statements pursuant to her application in which she denied any gang affiliations or police contact, although the investigation showed she has relationships with multiple gang members and has identified herself previously as a member of a gang. The case is being prosecuted by the Office of Queens District Attorney Richard A. Brown.

  DOI Commissioner Mark G. Peters said, “As alleged, this defendant concealed her history of gang affiliations and police contact in order to get a job at the very jails where many of these gang members were incarcerated. This arrest highlights, once again, the importance of a robust screening process for DOC employees, an issue we have issued Reports on in the past and continue to review.” 

  Queens District Attorney Richard A. Brown said, "The defendant in this case is accused of lying about her affiliation with gang members - and in fact is alleged to have stated she was a member of a street gang in the past. It is vitally important that the people working for the New York City Department of Correction are law abiding citizens and trust-worthy."

  DOI looked at the issue of DOC’s screening of new hires in 2015 and found serious discrepancies and issued a series of recommendations for improvements. Most of those recommendations were never implemented. Read the Report at the following link: https://www1.nyc.gov/assets/doi/reports/pdf/2015/2015-01-25-Pr01rikers_aiu.pdf 

  RILEY, 24, of Brooklyn, N.Y., is charged with two counts of Offering a False Instrument for Filing in the First Degree, a class E felony. Upon conviction, a class E felony is punishable by up to 4 years in prison.

  RILEY has been employed by DOC as a Legal Coordinator since August 2015 and receives an annual base salary of approximately $46,804. DOC suspended RILEY upon arrest. 

  According to the criminal complaint and DOI’s investigation, RILEY submitted two applicant investigation forms in which she stated that she did not have any gang affiliations and listed ten inmates with whom she had prior contact. RILEY also stated on documents that she had no prior police contact. DOI determined through its investigation, background checks, and recorded inmate phone calls, that RILEY maintained close contact with at least seven additional inmates incarcerated on Rikers Island through multiple phone conversations that she did not disclose in her application forms. Furthermore, in several recorded calls with an inmate, RILEY admitted to being a member of the Folk Nation gang, saying in one conversation, “Why you calling me crip? I’m Folk as of yesterday.”

  Additionally, DOI’s investigation found that RILEY had police contact in August 2017, when she was stopped and interviewed by the NY/NJ U.S. Marshal Task Force for driving a person known by the NYPD to be a member of the Folk Nation, and who was wanted for questioning in regards to a homicide. RILEY was questioned for two hours and released. RILEY signed, had notarized, and submitted several DOC Pre-Employment Forms declaring that the information she disclosed on forms and questionnaires was true and correct to the best of her knowledge.

  A criminal complaint is an accusation. A defendant is presumed innocent until proven guilty.

Operation Decoy Delivery: A.G. Schneiderman Announces Prison Sentence For Insurance Fraud Ringleader

Defendant Jean Mythro Davilmar Will Serve 4 2/3 to 14 Years In Prison

Defendant Filed Forged and Falsified Documents to Fraudulently Obtain Commercial Car Insurance Policies with Limits Totaling $1 Million

   Attorney General Eric T. Schneiderman announced a state prison sentence of 4 2/3 to 14 years for Jean Mythro Davilmar, 68, of Brooklyn, NY. Davilmar was convicted after trial for his participation in a massive scheme to fraudulently obtain commercial car insurance policies and New York State vehicle registrations. Over an eight-year period, the defendant and his co-conspirators fraudulently obtained policies with coverage limits totaling over $1 million by registering over 100 cars with fake companies, including delivery services, prompting investigators to dub the case “Operation Decoy Delivery.” Davilmar and nine other co-conspirators filed forged and falsified documents with insurance carriers, the Kings County Supreme Court Clerk’s Office, and the New York State Department of Motor Vehicle (“DMV”).

“The defendants involved in this fraud falsely claimed to be driving delivery vehicles – but instead drove up insurance rates for hard-working New Yorkers,” said Attorney General Schneiderman. “My office will continue working with our partners in government to stop those who try to cheat the system and leave New Yorkers to foot the bill.”

“This sentence demonstrates how seriously New York takes the crime of insurance fraud, which results in higher premiums for law-abiding New Yorkers,” said Financial Services Superintendent Maria T. Vullo. “DFS is pleased to have partnered with the New York State Office of the Attorney General in assisting with the investigation and holding this defendant accountable for his actions.”

“The National Insurance Crime Bureau applauds the staff of the New York State Attorney General’s Office for their hard work and dedication in prosecuting insurance fraud in New York,” said Kevin Gallagher, Regional Director of the Northeast Region of the National Insurance Crime Bureau. “The cost of insurance fraud is shared by all consumers.  Commercial premium fraud enables unscrupulous individuals and businesses to gain an unfair advantage over those who follow the law. This prison sentence sends a strong message to other individuals who may be contemplating engaging in insurance fraud. We look forward to our continued partnership with the Attorney General’s Office in fighting against insurance fraud for the benefit of all New Yorkers.”

On December 7, 2017, after a trial that included the testimony of 26 witnesses and the admission of hundreds of documents, the Honorable Judge Danny Chun found the defendant guilty of two counts of Grand Larceny in the Third Degree (a Class C felony); 17 counts of Insurance Fraud in the Third Degree (a Class D felony); four counts of Offering a False Instrument for Filing in the First Degree (a Class E felony); five counts of Criminal Possession of a Forged Instrument in the Second Degree (a Class D felony); and one count of Scheme to Defraud in the First Degree (a Class E felony).

The evidence at trial showed that between May 2006 and June 2014, Davilmar and his co-defendants engaged in a complex scheme to obtain commercial auto insurance for themselves and others in the names of fictitious business partnerships by submitting falsified documents and making false statements to multiple governmental agencies and insurance carriers.

The defendants created fictitious business partnerships by filing false documents with the Kings County Supreme Court Clerk’s Office. The defendants then fraudulently obtained commercial automobile insurance for multiple vehicles under the names of these fictitious business partnerships. In order to obtain lower premiums, on the applications for commercial insurance, the defendants falsely represented that the vehicles insured under the policies would be engaged in low-risk businesses such as delivery, carpentry, or photography services. To further lower premiums, defendants made additional misrepresentations including providing false pedigree information for purported members of the business partnerships, falsely stating the geographical location where the vehicles were operated and garaged, and misrepresenting the actual operators of the vehicles.

After fraudulently obtaining insurance for vehicles under commercial policies, the defendants submitted false registration and title applications to the DMV, registering the vehicles under the names of the fictitious partnerships. These DMV applications included forged signatures, false addresses, and fictitious individuals listed as the buyers and sellers of the vehicles. The defendants also submitted copies of the fraudulently obtained insurance cards as proof that the vehicles had valid insurance in New York State, a prerequisite for the DMV to issue registrations and license plates. 

The evidence at trial further revealed that when a policy lapsed because of nonpayment or because the defendants could not maintain the facade that the cars were being used in low-risk businesses, the defendants opened another policy with forged documents and transferred the cars onto the new policy.  

Ringleader Davilmar, who testified at trial, admitted to forming fake companies in order to obtain insurance policies for multiple vehicles. The evidence at trial showed that Davilmar created over a dozen fictitious business partnerships, including Florist Locomotion, Landscaping Express, Cleaners Express, Mybeda Express, Bedamy Express, and Damybe Express. In total, Davilmar and his co-conspirators obtained over 20 commercial insurance policies for over 100 vehicles, with coverage limits of up to $50,000 per accident for each vehicle. On cross-examination, Davilmar admitted to repeatedly using the alias “Jean Claude Marcelin” on documents filed with the DMV, the Kings County Clerk’s Office, and multiple auto insurance carriers.

Davilmar’s conviction and sentence are the culmination of a long-term investigation conducted by Attorney General Schneiderman's Automobile Insurance Fraud Unit. The Attorney General thanks the Department of Financial Services, the DMV, the New York Automobile Insurance Plan, and the National Insurance Crime Bureau for their valuable assistance in this case. The Attorney General also thanks the New York City Marshal’s Office, Progressive Insurance Co., Maidstone Insurance Co., National General Insurance Co., Farm Family Casualty Insurance Co., Assigned Risk Solutions, American Transit Insurance Co., GEICO Insurance Co., Travelers Insurance Co., and the CARCO Group for their instrumental cooperation during this investigation. The Attorney General also thanks the King’s County Clerk’s Office, the Massachusetts Registry of Motor Vehicles, and the United States Social Security Administration’s Inspector General’s Office for their valuable assistance. 

A.G. Schneiderman & Comptroller DiNapoli Announce Felony Charges Against Mount Vernon Mayor Richard Thomas

Thomas Accused of Stealing Campaign Funds, Establishing a Slush Fund for Personal Use from His Inaugural Fund, and Falsely Filing Disclosure Reports with the State Board of Elections and Mount Vernon Board of Ethics

  Attorney General Eric T. Schneiderman and Comptroller Thomas P. DiNapoli announced the arrest of Mount Vernon Mayor Richard Thomas for allegedly stealing campaign funds and lying about money he diverted from his inaugural committee for personal benefit. Mr. Thomas was arrested on a felony complaint this morning after an investigation that exposed the theft of approximately $12,900 from his campaign committee, and the diversion of over $45,000 from his inaugural committee for personal use and his failure to disclose it.

“As we allege, Mayor Thomas used his campaign and inaugural accounts as personal piggybanks – part of a long-running scheme that began during his 2015 campaign and continued throughout his time in office,” said Attorney General Schneiderman. “As we detail in the felony complaint, Mayor Thomas treated these accounts as slush funds to pay off cars, dinners, and even a Chanel purse, and then lied about it in his filings. Public corruption strikes at the very heart of our democracy, and we’re committed to continuing to root it out across New York.”

“This official allegedly misused campaign funds and failed to report gifts,” StateComptroller DiNapoli said. “We will continue to fight public corruption wherever we find it.”

The felony complaint filed with the Court  charges Thomas with one count of Grand Larceny in the Third Degree (a Class D felony); two counts of Offering a False Instrument for Filing in the First Degree (a Class E felony); and two counts of Offering a False Instrument for Filing in the Second Degree (a Class A misdemeanor).

The complaint details a scheme through which Thomas allegedly stole approximately $12,900 from his 2015 mayoral campaign committee, the Friends of Richard Thomas (“FORT”). After winning the mayoral election, Thomas established the Richard Thomas Inaugural Committee (“RTIC”), ostensibly to fund an inaugural celebration, but instead allegedly personally profited from RTIC by diverting over $45,000 for personal use and failing to disclose it.

An investigation further revealed that Thomas allegedly lied on his 2016 annual statement of financial disclosure with the City of Mount Vernon when he did not reveal that businesses controlled by an individual referred to in the felony complaint as “Individual 1,” as well as RTIC, paid Thomas’ personal American Express (“Amex”) bills. After his inauguration, Thomas appointed Individual 1 to a high-ranking position with a City agency that deals with public safety, although Individual 1 had no prior law enforcement experience. Additionally, and during the pendency of this investigation (which Thomas was made aware of in December 2016), Thomas allegedly lied on his 2017 annual statement of financial disclosure with the City when he did not reveal various sources of funding he received during the reporting period, including a tuition payment made to New York University on his behalf.

Theft from Campaign Committee and False Disclosures to the Board of Elections:

An analysis of Thomas’ personal and campaign committee bank accounts revealed that Thomas allegedly used FORT funds for personal use, stealing approximately $12,900.  

Thomas claimed on campaign filings that two separate payments that he issued to himself from FORT, totaling $8,900, were “reimbursements.” An analysis of Thomas’ personal bank accounts, however, revealed that Thomas never laid out any money warranting reimbursement; instead, records of Thomas’ personal bank account show that Thomas was low on personal funds at the time he received the so-called “reimbursements” from FORT. He allegedly used that money for personal expenses, such as rent for his family residence, car loans, and a payment for three automobile insurance policies for two vehicles on which Thomas was listed as the owner, and another vehicle registered to one of Thomas’ relatives. Thomas also allegedly took an additional $4,000 payment from FORT, not disclosed to the New York State Board of Elections, that he used for personal expenditures.

As alleged in the complaint, not only did Thomas falsely report money he took as reimbursements to the NYSBOE, but he also falsely disclosed meals during a family vacation as campaign expenses. That includes a family breakfast at JFK Airport that Thomas listed on FORT’s NYSBOE 2016 January Periodic filing as a housekeeping expense for “food”; Thomas falsely listed the restaurant’s corporate address, 352 Park Avenue in Manhattan, on the disclosure as the place of expenditure. The complaint also alleges that Thomas falsely disclosed a meal at a Bubba Gump Shrimp Co. restaurant in Mexico during a family vacation; rather than truthfully disclosing that the expenditure took place in Mexico, Thomas falsely used the address of the Bubba Gump restaurant located in Times Square in Manhattan and falsely designated the meal as a “volunteer appreciation” event.

Inaugural Committee Slush Fund:

Thomas also allegedly diverted over $45,000 from his inaugural committee for personal use and failed to disclose it.

After taking office in January 2016, Thomas allegedly used funds from the RTIC account to pay the monthly balance on his and his wife’s personal Amex. In mid-January 2016, a payment for $8,538.16 was made from the RTIC account to Thomas’ Amex; included in those expenses were charges incurred for a family vacation to Mexico. In late February 2016, a payment for $6,000 was made from the RTIC account to the Thomas Amex; included in this balance was the purchase of a Chanel purse that cost more than $2,000. In both March 2016 and May 2016, two separate $5,000 payments were made from the RTIC account to Thomas’ Amex, totaling another $10,000. In October 2016, a payment of $5,320.99 was made from the RTIC account to Thomas’ Amex account; in November 2016, another payment of $2,993.18 was made; and in December 2016, another payment of $3,685.14 was made.

As alleged in the complaint, Thomas took pains to conceal an additional $14,000 payment he received from RTIC by having two close personal relatives receive payments from RTIC and then kick those payments back to Thomas. Each of the two relatives owned companies that received payments from RTIC, ostensibly for services rendered relating to events sponsored by RTIC. According to the complaint, after receiving the payments from RTIC, the relatives then quickly issued checks to Thomas for close to the full amount paid to them.

Additional Ethics Violations:

According to the complaint, prior to Thomas filing his 2017 annual statement of financial disclosure with the City, he learned of the existence of the Attorney General’s investigation. In the 2017 annual statement, Thomas disclosed the RTIC payments to his American Express account as a “loan” from RTIC. Thomas, however, failed to disclose a $10,000 gift he received from a private individual that he had used to pay back the supposed RTIC loan. Additionally, he failed to disclose a $6,000 “gift” he received from another individual who paid his NYU Stern School of Business tuition bill.

The investigation is ongoing. The charges are merely accusations and the defendant is presumed innocent unless and until proven guilty in a court of law.

The Attorney General and Comptroller would like to thank the New York State Board of Elections Division of Election Law Enforcement.