Friends of VCP's November Events

Fall Wetland Volunteer Day
Saturday November 4th meeting at 10am
Did you know there are only 98 acres of freshwater wetlands left in the Bronx and 56 of them are in Van Cortlandt Park? Volunteers will help with native species planting, removal of non-native invasive plants and trash clean up within Tibbetts Wetlands. Meet inside the park near the last stop of the 1 train at Broadway and W. 242nd Street.

Volunteer Trails Restoration CrewSaturday November 4th from 10am to 3pm
Crew Members will work alongside trails professionals, developing skills in various areas of trail construction while improving the various trails in Van Cortlandt Park.  Projects include building boardwalks, clearing waterbars and drainage swells and installing drainage dips.  No prior trails experience is necessary; all training will be offered in an on-the-job format.  Interested? Contact john@vancortlandt.org for more information. Must be 18 years of age to join.

Woodlawn Playground BeautificationSaturday November 4th from 10:30am to 1pmJoin the Friends and the Women of Woodlawn as we continue our efforts to beautify the area around Woodlawn Playground. Meet at Van Cortlandt Park East and just south of Kepler Avenue.

Get Active Hiking Series in VCPSaturday November 18th meeting at 10am, Seven Wonders of VCP Tour.  Please wear appropriate shoes and bring plenty of water and a snack for hike. meet at FVCP Compost Site- enter the Park at Broadway and Mosholu Ave.

End of Season CelebrationSaturday November 18th from 10am to 1pmHelp with our final harvest to prepare the garden and compost bins for the winter through adding collected leaves and food scraps.  Projects suitable for all ages.  Volunteers will get a final chance to taste some of the produce from our garden.  Meet at FVCP’s Compost Site- enter the Park at Broadway and Mosholu Ave.

Friends of Van Cortlandt Park

vancortlandt.org

718-601-1553

info@vancortlandt.org

80 Van Cortlandt Park South Ste. E1

Bronx, NY 10463

FOLLOWING DEADLY NEW YORK TERROR ATTACK, COUNCIL TRANSPORTATION CHAIR YDANIS RODRIGUEZ TO CALL ON NYC TO INSTALL MORE SAFETY BOLLARDS

  Tomorrow, Thursday, November 2nd  at 12:00 pm Noon on the steps of City Hall, Council Transportation Chair Ydanis Rodriguez, elected officials, and transportation advocates will call on the City of New York to install pedestrian safety bollards along sidewalks in key areas with high pedestrian volume and other pedestrian safety measures to prevent potential attacks in NYC.

Council Member Rodriguez is the sponsor of  Introduction 1658 that would require the installation of bollards in front of schools, plazas and vision zero priority corridors, however, the call will be to begin installation now before the legislation goes to a vote.

The heightened urgency of protecting pedestrians comes after a driver identified as Sayfullo Saipov, 29, ran down a bike lane in a rented Home Depot pickup truck killing nine people and injuring eleven. There have similar attacks in France, Spain, the United Kingdom, and Times Square where vehicles have been used a weapons.

MAYOR DE BLASIO, POLICE COMMISSIONER O’NEILL AND GOVERNOR CUOMO HOLD MEDIA AVAILABILITY ON TERRORIST ATTACK

  Police Commissioner James P. O’Neill: Good afternoon everybody. Just keep in mind that this incident occurred a little more than two hours ago so all the information that we are giving you right now is preliminary and subject to change.

After I speak you are going to hear from Governor Cuomo and Mayor de Blasio.

First, I just want to say that today there was a loss of innocent life in Lower Manhattan. The dead and injured were just going about their days, heading home from work or from school, or enjoying the afternoon sun on bicycles. This is a tragedy of the greatest magnitude for many people, for many families here in New York City and beyond today.

I want to commend the response of our NYPD officer that was on post near the location who stopped the carnage moments after it began. And also work, the work of the first responders, including the Fire Department and the EMS personal surely helped save additional lives.

As I said I will give more of a chronology in a couple of minutes, but right now I would like to introduce Mayor de Blasio.

Mayor Bill de Blasio: Thank you Commissioner. It’s a very a painful day in our city – horrible tragedy on the West side. Let me be that clear based on the information we have at this moment, this was act of terror. And a particularly cowardly act of terror aimed at innocent civilians, aimed at people going about their lives who had no idea what was about to hit them.

We at this moment, based on the information we have, we know of eight innocent people who have lost their lives and over a dozen more injured. We know that this action was intended to break our spirit but we also know New Yorkers are strong, New Yorkers are resilient. And our spirit will never be moved by an act of violence, an act meant to immediate us.

We have been tested before as a city very near the site of today’s tragedy. And New Yorkers did not give in in the face of these kinds of actions. We will respond as we always do. We will be undeterred. And I want to thank everyone at the NYPD, all our first responders for their extraordinary efforts in the midst of this tragedy, starting with the officer who stopped this tragedy from continuing – all the first responders who came to the aid of those who were injured.

An investigation is under way to get all the facts and what we will tell you today will of course be preliminary. But we know we will get down to the bottom of what happened. I want to ask all New Yorkers, all Americans to keep the families of those lost in your thoughts and prayers. They will need our support.

And I want to ask all New Yorkers to be vigilant. We know it’s Halloween night. And we know in the days ahead people will be uneasy. We ask all New Yorkers to live by the idea – if you see something, say something – tell an officer immediately if you see anything unusual, anything that worries you. Be vigilant and know that there will be extensive additional employments of NYPD officers this evening and throughout the days ahead.

We will also keep you posted as this investigation continues and as the NYPD gains more information. Governor Cuomo.

Governor Andrew Cuomo: Thank you. First, our thoughts and prayers with those New Yorkers who we lost today – it reminds us all how precious life is. They left the house this morning – they were enjoying the beautiful Westside of Manhattan on a beautiful fall day and they are not going to be returning home. And that shock and that pain is going to be very real. And our thoughts [inaudible] our prayers are with all of them.

Our first responders did an extraordinary job. The NYPD, the FDNY, the FBI, the New York State Police, EMS – they, we have the finest security on the globe and to see them in action today proved that once again.

The new terrorist tactic which they have called for publicly, are these lone wolves who commit an act of terror. This is all very preliminary – it’s only been a couple of hours. But at this point, there’s no evidence to suggest a wider plot or a wider scheme, but the actions of one individual who meant to cause pain and harm and probably death, and the resulting terror, and that was the purpose. 

We will be vigilant – more police everywhere, you’ll see them in the airports, you’ll see them in the tunnels. It’s not because there’s any evidence of any ongoing threat or any additional threat, it is just out of vigilance and out of caution. And the truth is, New York is an international symbol of freedom and democracy – that’s what we are – and we are proud of it. That also makes us a target for those people who oppose those concepts, and we’ve lived with this before, we’ve felt the pain before, we feel the pain today, but we go forward together and we go forward stronger than ever. 

We’re not going to let them win, and if we change our lives, we contort ourselves to them, then they win and we lose. We’ll go about our business – again, there’s no ongoing threat, there’s not evidence of that at this time. So, there’s no reason to have any undue anxiety. You will see more security forces, but that’s only because it’s an abundance of caution and not a signal of anything else. And there will be continued investigation and justice will be done. But again, to those we lost – they’re in our thoughts and our prayers. 

To the first responders, thank you, thank you, thank you for the job you do. You put your life one the line every day. You do it better than anyone else. And to New Yorkers – be New Yorkers and live your life and don’t let them change us or deter us in any manner, shape, or form.

Commissioner O’Neill: Thanks, Governor Cuomo. Thank you, Mr. Mayor. As I said, I’m going to go through the chronology here. And I know when I’m done, you’re going to have a lot of questions, but we’re not going to go too deep into it, it’s only two hours. And after I get done with the chronology, Dan Nigro is going to talk about the injuries. 

It’s about 3:05 pm, a male driving a rented Home Depot pickup truck entered the West Side Highway bicycle path at Houston Street, began driving southbound, striking a number of pedestrians and bicyclists along the route. At Chambers Street, the truck collided with a school bus, injuring two adults and two children. After the collision, the driver of the truck – a 29-year-old male – exited the vehicle, brandishing two handguns. The uniformed police officer assigned to the 1st Precinct, confronted the subject and shot him in the abdomen. The subject was wounded and transported to a local hospital. A paintball gun and a pellet gun were recovered at the scene. The subject’s identity is not being released at this time pending further investigation. At this point, there are eight fatalities reported in connection with this incident. In addition, several people have been injured and Commissioner Nigro from our Fire Department will discuss that. 

Fire Commissioner Daniel Nigro: Thank you, Jim. As the Police Commissioner said, six people died – they were pronounced at the scene between Houston Street and Chambers Street. They were all males. Two others were transported in traumatic arrest and were pronounced at the hospital. We also transported 11 people, all with serious but, at this moment, not life-threatening injuries. The injuries are what you may expect as a truck went at high speed down that bicycle path and struck bicyclists and pedestrians. There may be more injuries as people self-evacuated and we will determine that later as we do our survey. But that’s the patient count and the deaths as we know it now. 

Deputy Commissioner John Miller, Intelligence and Counter-terrorism, NYPD: So, as you know, through the SHIELD program, we do a very wide outreach. We have just under 20,000 members in the private sector. After ISIS, [inaudible] magazine came out with the issue just about two years ago around this time of year suggesting car attacks. You’ll recall, one of the targets they suggest was the Thanksgiving Day Parade. We went and did extensive outreach to the truck rental business. We visited over 148 truck rental locations in this area. The obvious ones – U-Haul, Ryder, Home Depot, etcetera, and talked about suspicious indicators, ways to come forward. After attacks on the German Christmas market, after Nice, we repeated those visits two more times either by making telephonic contact, email, or going back to the same places. So, the industry has had a high level of awareness on this matter from the NYPD.

Commissioner O’Neill: The incident is over. It did end right by Stuyvesant High School, so we had to make sure all the kids were taken care of, and we held them in place for a while, and it was important we do that, but this incident is over. He’s a 29-year-old male, he did make a statement when he exited the vehicle. And if you just look at the M-O of the attack – that’s consistent with what’s been going on. So, that, along with the statement that’s enabled us to label this a terrorist event. 

Mayor Bill de Blasio:  I’ll just close this off here by saying look, the NYPD is investigating this with our federal partners, with our State partners. There’s going to be a very, very thorough investigation, but the most important thing – as Governor Cuomo said, as Chief O’Neill said – people should go about their business knowing the NYPD is out in force with our partner agencies tonight and throughout the week. Very important additional measures are going to be taken for people’s safety, but the bottom line is we are going to go about our business in the city, and we are not going to be deterred. 

MAYOR DE BLASIO DOUBLES PLANNED SENIOR HOUSING TO 30,000 AFFORDABLE HOMES

“Seniors First,” 3^RD initiative of expanded 300,000-home housing plan, will make 15,000 more homes age-friendly,’ build state-of-the-art senior buildings, protect existing senior developments

  Mayor Bill de Blasio today announced “Seniors First,” a slate of new affordable housing programs that will increase the amount of senior housing across the city. In total, the City will double its commitment to senior housing over the extended 12-year Housing New York plan, serving 30,000 senior households by 2026.    

The number of seniors in New York is projected to grow 40 percent by 2040. To meet the housing needs of older New Yorkers on fixed incomes, the City will invest $150 million to make more homes accessible to seniors and people with disabilities; build new 100 percent affordable developments on underused NYCHA, and public and private sites; and preserve aging senior housing built as part of HUD’s 202 program.

As an immediate step, the City will seek proposals for 100-pecent affordable senior buildings totaling 300 new homes on three underused NYCHA sites at Sotomayor, Bushwick II (Group E), and Baruch Houses.

“The federal government has gotten out of the business of building senior housing, so New York City is jumping into it in a big way. We won’t let seniors be pushed out of the neighborhoods they helped build,” said Mayor de Blasio.

Along with the Neighborhood Pillars program and the Mitchell-Lama Reinvestment Program, “Seniors First” is the third new initiative announced as part of the Mayor’s plan to accelerate the creation and preservation of affordable housing across the city by financing 200,000 affordable homes by 2022, and expand that goal to 300,000 affordable homes by 2026 – enough to house the entire population of Boston.

“Seniors First” is needed to address the shortage of affordable housing for low-income seniors, who are the most rent-burdened and more likely to live on fixed-incomes than other New York City populations.

Through a multi-pronged strategy, the City will serve 25,000 senior households—in addition to the 5,000 already reached, through:

15,000 Age-Friendly Homes: The City is making a $150 million new commitment to address the needs of senior residents in buildings preserved over the next eight years. HPD will conduct assessments of the apartments it preserves with residents 62 or older, and make that housing accessible through improvements such as installing lever door handles and shower bars and widening doors to make bathrooms and kitchens wheelchair-friendly. These improvements will ensure seniors can age in place and retain their mobility as they age.

4,000 New Senior Apartments: HPD is committed to developing 4,000 new affordable senior homes through its Senior Affordable Rental Apartments Program. Of the total under the Mayor’s housing plan, about 1,000 will now be constructed on a dedicated pipeline of underused NYCHA land. They will be developed in addition to the existing 10,000 affordable apartments already planned through NextGen NYCHA’s 100% affordable program.

6,000 Senior Apartments Protected: For decades, the federal government built hundreds of senior housing developments across the city through the HUD 202 program. These buildings are privately owned and operated, and many face physical deterioration that threatens their continued affordability. The City will target those properties most in need of protection, making repairs and providing long-term financing in exchange for continued affordability.

“As we accelerate and expand our work through Housing New York, we must put our seniors first. Today, we are doubling our initial commitment to senior housing and introducing a three-fold strategy to deliver on this critical priority. Through a new program to make senior homes more accessible in the buildings we rehab across the city, a targeted focus on protecting the existing stock of senior buildings, and a dedicated pipeline of underused NYCHA land for new affordable senior housing, we are operating on all cylinders to serve the seniors who helped build our great city,” said Housing Preservation and Development Commissioner Maria Torres-Springer. “I want to thank the Mayor, NYCHA Chair Shola Olatoye, HDC President Eric Enderlin, and all my colleagues across City government for their partnership to keep our seniors in safe, quality, affordable housing.” 

NEWS FROM CONGRESSMAN ELIOT ENGEL

Engel Statement on First Indictments From Mueller Investigation

  Congressman Eliot L. Engel, the Ranking Member on the House Foreign Affairs Committee, issued the following statement on the Federal indictments of Paul Manafort, Rick Gates, and George Papadopoulos in conjunction with the Robert Mueller investigation:

"The charges against President Trump's former campaign manager Paul Manafort are deadly serious and point to close and possibly illegal ties between foreign countries and the person Trump hand-picked to lead his run for the White House. Furthermore, the guilty plea from a Trump aide revealed today shows that at least one person in the President's inner circle was in contact with Russians and tried to cover it up by lying to the FBI.

"We need to know everything that has occurred here; no stone can be left unturned. That's why Mr. Mueller's investigation must proceed unimpeded. If the President fires Mr. Mueller or pardons anyone in exchange for their silence, we will find ourselves in a constitutional crisis rivaling Watergate. 

"I also believe it is imperative that we convene an independent commission—one that is separate and apart from the politics of the Justice Department and Congress—to investigate the possible collusions between the Trump campaign and the Kremlin. Clearly, Vladimir Putin and his cronies worked hard to tip the scales of our election. For the sake of protecting our electoral process and its integrity going forward, we need the extent of their meddling to be made clear and devise ways to prevent future attacks on our democracy."

Engel Statement On District Court Blocking Part of President Trump’s Ban on Transgender Service Members

  Congressman Eliot L. Engel, a top member on the House Energy and Commerce Committee, issued the following statement on today’s ruling by the U.S. District Court for the District of Columbia issuing a preliminary injunction to block President Trump’s ban on transgender service members in the military:

“The President’s announcement banning transgender American’s from serving in the military was a hateful and discriminatory slap in the face to the thousands of transgender service members who have volunteered their lives to protect our freedom. I’m pleased to hear that Judge Kollar-Kotelly’s injunction will prevent this administration from discharging brave service members while these cases make their way through the courts.

“This ruling is a victory for equality. All Americans, regardless of gender identity, should be able to serve their country. I hope today’s decision will ultimately derail this shortsighted decree by the President.”

Acting Manhattan U.S. Attorney And FBI Assistant Director Announce Insider Trading Charges Against Managing Director Of Private Equity Fund

  Joon H. Kim, the Acting United States Attorney for the Southern District of New York, and Danny Kennedy, the Acting Assistant Director-in-Charge of the Los Angeles Field Office of the Federal Bureau of Investigation (“FBI”), announced the indictment today of  BENJAMIN CHOW, a/k/a “Ben Chow Zhou Bin,” a/k/a “Benjamin Bin Chow,” a/k/a “Bin Zhou,” for conspiracy to commit securities fraud and securities fraud in connection with a $5 million insider trading scheme relating to the securities of Lattice Semiconductor Corporation (“Lattice”).  The case is assigned to U.S. District Judge Gregory H. Woods.

Acting U.S. Attorney Joon H. Kim said:  “As alleged, Benjamin Chow tipped his friend about a potential acquisition of Lattice Semiconductor Corporation by private equity firms he managed, including one based in China.  Chow’s illegal tips resulted in multimillion-dollar profits for his friend and business associate.  This type of alleged illegal tipping is not only illegal, but erodes public confidence in our markets.  Protecting the integrity of our financial markets remains a top priority of this Office.”

FBI Assistant Director-in-Charge Danny Kennedy said:  “Mr. Chow misused his position of trust to undermine the integrity of the market.  The FBI and our partners are committed to fairness in the marketplace by holding accountable those who threaten legitimate exchanges by trading on proprietary knowledge.”

According to the allegations in the Indictment filed in Manhattan federal court:[1]

From approximately March to November 2016, CHOW provided a friend and business associate (“CC-1”) with material nonpublic information relating to a potential merger between Lattice and private equity firms managed by CHOW, one based in Beijing, China (“Firm-1”) and one based in Palo Alto, California (“Firm-2”).  CC-1 in turn used such information to make millions of dollars in profitable securities trades through accounts opened in the names of family members and associates of CC-1. 

Specifically, as Managing Director of Firm-1 and later Managing Partner of Firm-2, CHOW obtained material nonpublic information regarding potential merger agreements between Lattice and Firm-1, and later, Firm-2.  Information concerning the potential merger agreements was subject, among other things, to nondisclosure agreements executed between Lattice and Firm-1, and subsequently between Lattice and Firm-2.   

In violation of these agreements, and in breach of his duties, CHOW provided CC-1 with material nonpublic information regarding the potential mergers between Lattice and Firm-1 and Lattice and Firm-2, through in-person meetings, voice messages, and text exchanges.  On multiple occasions, CC-1 made profitable trades in Lattice shortly after receiving the material nonpublic information from CHOW, yielding a total of at least approximately $5 million in profits for CC-1. 

CHOW, 46, of Los Angeles, California, is charged with one count of conspiring to commit securities fraud, which carries a maximum prison sentence of five years in prison, and 13 counts of securities fraud, which carry maximum sentences of between 20 and 25 years in prison.  The charges also carry a maximum fine of $5 million, or twice the gross gain or loss from the offense.  The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.

Mr. Kim praised the exceptional work of the Federal Bureau of Investigation, and thanked the Securities and Exchange Commission for its assistance.

The allegations contained in the Indictment and Complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.

 

[1] As the introductory phrase signifies, the entirety of the text of the Indictment – and the description of the Indictment set forth herein – constitute only allegations, and every fact described should be treated as an allegation.

Former Chairman And CEO Of Federal Credit Union And Computer Programmer For Unlawful Bitcoin Exchange Sentenced In Manhattan Federal Court

  Joon H. Kim, the Acting United States Attorney for the Southern District of New York, announced that TREVON GROSS and YURI LEBEDEV were sentenced by U.S. District Judge Alison J. Nathan to prison in connection with a bribery scheme to take over control of a federal credit union and a related fraud scheme to operate Coin.mx, an illegal Bitcoin exchange.  On March 17, 2017, GROSS and LEBEDEV were convicted following a jury trial on all counts with which they were charged in the controlling indictment.  On October 20, Judge Nathan sentenced LEBEDEV to 16 months in prison.  Earlier today, Judge Nathan sentenced GROSS to 60 months in prison.    

Acting U.S. Attorney Joon H. Kim said:  “Yuri Lebedev and others at Coin.mx, an unlawful Bitcoin exchange, tricked banks into processing millions of dollars in transactions by hiding the nature of their business.  When the banks caught on to their scheme, Lebedev and others bribed Trevon Gross in order to gain control of a credit union to process those transactions, undermining the credit union’s safety and solvency in the process.  Despite elaborate efforts by the defendants to hide their schemes, their brazen crimes were exposed at trial.  Gross and Lebedev’s criminal schemes have now landed them in federal prison.”  

According to the Superseding Indictment on which GROSS and LEBEDEV were convicted, evidence admitted at trial, and statements made during the sentencing proceedings: 

The Unlawful Bitcoin Exchange

Between 2013 and July 2015, LEBEDEV helped operate Coin.mx, an unlawful internet-based Bitcoin exchange, along with Anthony Murgio, the founder of Coin.mx.  LEBEDEV, Murgio, and their co-conspirators engaged in substantial efforts to evade detection of their unlawful Bitcoin exchange by operating through a phony front company called “Collectables Club.”  Coin.mx used the “Collectables Club” to open financial accounts in order to trick financial institutions into believing the unlawful Bitcoin exchange was simply a members-only association of individuals who discussed, bought, and sold collectible items and memorabilia.  LEBEDEV and his co-conspirators deceived financial institutions by deliberately misidentifying and miscoding Coin.mx customers’ credit and debit card transactions, in violation of bank and credit card company rules and regulations.  Through the illegal Coin.mx scheme, LEBEDEV and his co-conspirators caused more than $10 million in Bitcoin-related transactions to be processed illegally through financial institutions. 

The Credit Union Bribery Scheme

In 2014, in an effort further to evade scrutiny from financial institutions about the nature of the business engaged in by Coin.mx, LEBEDEV, Murgio, and their co-conspirators gained control of HOPE Federal Credit Union (“HOPE FCU”), a low-income designated federal credit union in Lakewood, New Jersey, for which GROSS served as Chairman and CEO.  After making more than $150,000 in illegal bribes at GROSS’s direction to bank accounts in the name of a church where GROSS served as the pastor, LEBEDEV, Murgio, and their co-conspirators took control of HOPE FCU.  With GROSS’s assistance, Murgio installed LEBEDEV and various co-conspirators on HOPE FCU’s Board of Directors and transferred Coin.mx’s banking operations to HOPE FCU.  GROSS also ceded operational control of the credit union to the board members installed by Murgio, including LEBEDEV.  Thereafter, GROSS, LEBEDEV, and others worked to run tens of millions of dollars of ACH (Automated Clearing House) transactions through the credit union without adequate capital or anti-money laundering controls, thus putting HOPE FCU’s financial condition at substantial risk. 

GROSS, LEBEDEV, Murgio, and their co-conspirators also obstructed an examination of HOPE FCU by the National Credit Union Administration (“NCUA”) and made false statements to the NCUA in order to perpetuate LEBEDEV and Murgio’s control of the credit union.  These included deliberately failing to disclose the bribe payments; misrepresenting the location of Coin.mx-affiliated businesses, including the “Collectables Club,” so as to claim that they were eligible to be members of the credit union and to serve as Board members; and manipulating the accounting at HOPE FCU so as to hide its true financial condition and the fact that it was processing tens of millions of dollars of ACH transactions without adequate controls.  HOPE FCU was operated as a captive bank by MURGIO and his co-conspirators until the end of 2014.  In October 2015, the NCUA placed HOPE FCU into conservatorship and subsequently liquidation.

On March 17, 2017, GROSS and LEBEDEV were convicted after a four-week jury trial of conspiring to make corrupt payments to an officer of a financial institution, to receive corrupt payments by an officer of a financial institution, to obstruct an NCUA examination of a financial institution, and to make false statements to the NCUA.  GROSS was also convicted of the receipt of corrupt payments by an officer of a financial institution.  LEBEDEV was also convicted of making corrupt payments to an officer of a financial institution, wire fraud, bank fraud, and conspiring to commit wire fraud and bank fraud.  In imposing today’s sentence, Judge Nathan found that GROSS committed perjury when he testified under oath at trial. 

 In addition to the prison sentences, GROSS, 47, of Jackson, New Jersey, and LEBEDEV, 39, of St. Johns, Florida, were each sentenced to three years of supervised release and ordered to pay fines of $12,000 and $10,000, respectively.  In addition, GROSS and LEBEDEV were ordered to forfeit the proceeds of their crimes and to pay restitution, jointly and severally with Murgio, to the NCUA. 

All four of LEBEDEV and GROSS’s co-defendants have been convicted and have been sentenced or are awaiting sentence by Judge Nathan.

Anthony R. Murgio pled guilty on January 9, 2017, to conspiring to operate an unlicensed money transmitting business, conspiring to commit wire fraud and bank fraud, and conspiring to obstruct an examination of HOPE FCU by the NCUA in furtherance of the illegal Coin.mx scheme.  On June 27, 2017, Murgio was sentenced to 66 months in prison, three years of supervised release, and a $12,000 fine. 

Michael J. Murgio pled guilty on October 27, 2016, to conspiring to obstruct an NCUA examination of a financial institution, and was sentenced on January 27, 2017, to one year of probation and a $12,000 fine.

Jose M. Freundt pled guilty on October 13, 2016, to operating an unlicensed money transmitting business, conspiring to operate an unlicensed money transmitting business, making corrupt payments to an officer of a financial institution, conspiring to make corrupt payments to an officer of a financial institution, wire fraud, and conspiring to commit wire fraud.  Freundt is scheduled to be sentenced on December 18, 2017.

Ricardo Hill pled guilty on January 17, 2017, to operating an unlicensed money transmitting business; conspiring to operate an unlicensed money transmitting business; making corrupt payments to an officer of a financial institution; conspiring to make corrupt payments to an officer of a financial institution, to receive corrupt payments by an officer of a financial institution, to obstruct an NCUA examination of a financial institution, and to make false statements to the NCUA; wire fraud; bank fraud; and conspiring to commit wire fraud and bank fraud.  Hill is scheduled to be sentenced on December 18, 2017.

Mr. Kim praised the outstanding investigative work of the Federal Bureau of Investigation and the United States Secret Service.  He also thanked the NCUA for its assistance with the investigation and prosecution.

A.G. Schneiderman Announces $700,000 Joint Settlement With Hilton After Data Breach Exposed Hundreds Of Thousands Of Credit Card Numbers

Hilton Agrees To Provide Expedient Notice To Consumers Of Future Breaches, Reform Its Data Security Practices, And Conduct Regular Assessments Of Its Data Security Program

  Attorney General Eric T. Schneiderman today announced a $700,000 settlement with Hilton Domestic Operating Company, Inc., formerly known as Hilton Worldwide, Inc. (“Hilton”), after data security incidents exposed over 350,000 credit card numbers in two separate breaches in 2015. Attorney General Schneiderman’s investigation, conducted in collaboration with the Vermont Attorney General’s office, revealed that Hilton did not provide consumers with timely notice and did not maintain reasonable data security.

“BusinAesses have a duty to notify consumers in the event of a breach and protect their personal information as securely as possible,” said Attorney General Schneiderman. “Lax security practices like those we uncovered at Hilton put New Yorkers’ credit card information and other personal data at serious risk. My office will continue to hold businesses accountable for protecting their customers’ personal information.”

Hilton is one of the largest hospitality companies in the world, with a portfolio of 14 brands comprising more than 4,900 properties with more than 796,000 rooms in 104 countries and territories. The company owns, manages, or franchises a portfolio of brands including Hilton Hotels & Resorts, Waldorf Astoria Hotels & Resorts, Conrad Hotels & Resorts, DoubleTree by Hilton, Embassy Suites by Hilton, Hilton Garden Inn, Homewood Suites by Hilton, and Hilton Grand Vacations.

On February 10, 2015, Hilton learned from a computer services provider that a system Hilton utilized in the United Kingdom was communicating with a suspicious computer outside Hilton’s computer network. A forensic investigation revealed credit-card targeting malware that potentially exposed cardholder data between November 18 and December 5, 2014.

On July 10, 2015, Hilton learned of a second breach through an intrusion detection system. A forensic investigation found further malware designed to steal credit card information. It found that payment card data was potentially exposed from April 21, 2015 through July 27, 2015, as well as evidence of 363,952 credit card numbers aggregated for removal by the attackers.

Hilton did not provide notice until November 24, 2015, over nine months after the first intrusion was discovered. While Hilton alleged that there was no evidence of removal of the cardholder data, the forensic investigator was not able to review all relevant logs and the intruders used anti-forensic tools to hide their tracks.

Pursuant to New York General Business Law § 899-aa(2), any person or business which owns or licenses computer data that includes “private information,” a term which includes a person’s name and credit card number, shall disclose any breach of the security of the system following discovery to any resident of New York whose information was, or is reasonably believed to have been, acquired by a person without valid authorization. The disclosure must be made in the “most expedient time possible and without unreasonable delay.” Hilton did not provide notice to consumers in the most expedient time possible and without unreasonable delay.

The investigation found that Hilton was also not in compliance with certain Payment Card Industry Data Security Standard (“PCI DSS”) requirements. The PCI DSS is a proprietary information security standard for organizations that process branded credit cards from the major card companies, including Visa, MasterCard, American Express, Discover, and JCB. The standard is mandated by the card brands and administered by the Payment Card Industry Security Standards Council to ensure cardholder data is processed in a secure environment.

New York Executive Law § 63(12) and New York General Business Law §§ 349 and 350 prohibit deceptive acts or practices in conducting business. Hilton represented to its customers that it would maintain their personal information, such as credit card information, using reasonable data security. For example, Hilton’s Global Privacy Statement on Hilton’s website (www.hilton.com) provides that Hilton “will take reasonable measures to: (1) protect personal information from unauthorized access, disclosure, alteration or destruction and (ii) keep personal information accurate and up-to-date as appropriate.” The policy broadly defines customers’ personal information to include, among other things, name, address, and payment card information. Hilton also represented that it would keep its customer’s personal information “secure.” For example, upon logging on to Hilton.com, members are immediately presented with a statement that “Your information is secure” with a hyperlink to Hilton’s Global Privacy Statement. By violating express and implied representations of reasonable data security, Hilton violated New York Executive Law § 63(12) and New York General Business Law §§ 349 and 350.

The settlement requires Hilton to provide immediate notice to consumers affected by a breach, maintain a comprehensive information security program, and conduct data security assessments as follows:

Notice to Consumers

Hilton has agreed to provide notice to affected New York residents and the Attorney General’s office of a breach involving private information in compliance with, and as defined by, GBL § 899-aa. In determining whether the information “has been acquired, or is reasonably believed to have been acquired” pursuant to GBL § 899-aa(2), Hilton must consider all information reasonably available to it, including, among other things, (i) indications that the information is in the physical possession and control of a person without valid authorization, such as a lost or stolen computer or other device containing information; (ii) indications that the information has been downloaded or copied; (iii) indications that the information was used by an unauthorized person, such as fraudulent accounts opened or instances of identity theft reported; (iv) that the information has been made public; and (v) evidence of malware on its computer systems designed to collect cardholder data.

Comprehensive Information Security Program

Hilton has agreed to design and maintain a comprehensive information security program designed to protect consumer cardholder data including by:

1. designating  an employee to coordinate and supervise its information security program;
2. identifying material internal and external risks to information security that could lead to unauthorized disclosure, misuse, loss, alteration, destruction, or other compromise of the information;
3. implementing reasonable safeguards to control those risks; and perform regular testing or monitoring of the safeguards’ effectiveness;
4. developing and using reasonable steps to select and retain service providers capable of appropriately safeguarding cardholder data and contractually require such service providers to also implement and maintain appropriate safeguards for the information; and
5. evaluating Hilton’s information security program and adjust it based on testing or monitoring results or other circumstances (including material changes to Hilton’s operations or business arrangements) that Hilton knows, or an entity acting reasonably under the circumstances would know, may have a material impact on the program’s effectiveness.

Cardholder Data Assessments

Hilton has agreed to annually obtain a written assessment of the extent of its compliance with PCI DSS and report to the Attorney General if it is not fully compliant.

New York will receive $400,000 of the settlement and Vermont will receive the remainder.