30 Defendants Charged With Narcotics And Firearms Offenses In Manhattan Federal Court

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, William F. Sweeney Jr., Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), and James P. O’Neill, the Commissioner of the New York City Police Department (“NYPD”), announced the unsealing of five Indictments charging 30 defendants with committing various narcotics and firearms offenses in Manhattan and the Bronx.   

As alleged in the Indictments unsealed in Manhattan federal court[1]:

United States v. Neury Abreu, et al., 19 Cr. 821

Between January 2016 and November 2019, NEURY ABREU, 26, ALEXANDER DEJESUS, 27, JOSHUA PEREZ, 27, ALEXANDER BAEZ, 46, IVAN BREA, 28, JOSE CRUZ, 22, LUIS ESPINAL, 30, and ANTHONY MELO, 19, conspired to sell 280 grams or more of crack cocaine, cocaine, Oxycodone, and marijuana.  Members of the conspiracy distributed narcotics in and around the Inwood neighborhood of Manhattan.  

Between January 2016 and November 2019, ABREU, DEJESUS, and PEREZ used and carried firearms during and in relation to, and possessed firearms in furtherance of, the narcotics conspiracy charged in the Indictment.  PEREZ also possessed a firearm on or about July 8, 2019, and on or about July 11, 2019, after having previously been convicted of a felony.  

United States v. Alexander Melo, et al., 19 Cr. 818

Between April 2019 and November 2019, ALEXANDER MELO, 28, JAVIER JANIEL, 23, FRANMY LUNA, 24, and JUAN PERALTA, 25, conspired to sell 280 grams or more of crack cocaine, and cocaine.  Members of the conspiracy distributed narcotics in and around the Inwood neighborhood of Manhattan.  

On or about October 9, 2018, MELO possessed a shotgun after having been convicted of a felony, and having had three convictions for three serious drug offenses, all of which were committed on occasions different from one another, in violation of the Armed Career Criminal Act. 

United States v. Mario Delgado, et al., 19 Cr. 817

Between October 2018 and November 2019, MARIO DELGADO, 32, DANIEL CUEVAS, 27, and EDWARD RODRIGUEZ, 30, conspired to sell 100 grams and more of Acetyl Fentanyl (which is an analogue of Fentanyl), Fentanyl, and Oxycodone.  Members of the conspiracy distributed narcotics in and around the Washington Heights neighborhood of Manhattan.  

United States v. Roberto Sanchez, et al., 19 Cr. 820

Between January 2019 and November 2019, ROBBERTO SANCHEZ, 41, and JULIO ABREU, 28, conspired to sell heroin, cocaine, and marijuana.  Members of the conspiracy distributed narcotics in and around the Washington Heights neighborhood of Manhattan.  

United States v. Alberto Marte, 19 Cr. 795

From at least in or about 2018 through in or about 2019, ALBERTO MARTE, a/k/a “Scotty,” a/k/a “Skylet,” 42, JUNIOR RODRIGUEZ, a/k/a “Skrilla,” 23, ERICK MELENCIANO, a/k/a “Gualey,” 26, NICHOLAS FALU, a/k/a “Nico,” 31, KEVIN ROSADO, a/k/a “Malda,” 26, GUERY CRUZ, a/k/a “Capo,” 24, JONATHAN RODRIGUEZ, a/k/a “Nathan,” 31, OMAR BAEZ, a/k/a “Smokey,” 23, SAMUEL SOSA, a/k/a “Sammy,” 21, YOAN DELACRUZ, a/k/a “Johan,” 29, RAYMER CASILLA, a/k/a “Ray Savage,” 23, KEVIN MELENDEZ, a/k/a “Freaky,” 26, and JOSE BAUTISTA, a/k/a “Nelo,” a/k/a “Echo,” 30, conspired to sell oxycodone and possessed firearms in furtherance of that conspiracy.

Thirteen of the 30 defendants were arrested this morning and will be presented later today before U.S. Magistrate Judge Sarah Netburn in Manhattan federal court.  Twelve of the 30 defendants, charged in connection with United States v. Alberto Marte, were arrested on November 13, 2019, and presented before U.S. Magistrate Judge Katharine H. Parker.  JOSHUA PEREZ was already in federal custody and will be presented at a later date. 

Charts containing the names, charges, and maximum penalties for the defendants are set forth below.  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.

Mr. Berman praised the outstanding investigative work of the FBI/NYPD Metro Safe Streets Task Force, and he thanked the New York City Department of Investigation for its assistance in the case. 

This case is being handled by the Office’s Violent and Organized Crime Unit.  Assistant United States Attorneys Frank Balsamello, Adam Hobson, Jacob Warren, Celia Cohen, and Dominick Gentile are in charge of the prosecutions.

The charges contained in the Indictments are merely accusations, and the defendants are presumed innocent unless and until proven guilty.       

 United States v. Neury Abreu, et al., 19 Cr. 821

COUNT	CHARGE	DEFENDANTS	MAX. PENALTIES
1	Narcotics trafficking conspiracy 21 U.S.C. § 846	NEURY ABREU, ALEXANDER DEJESUS, JOSHUA PEREZ, ALEXANDER BAEZ, IVAN BREA, JOSE CRUZ, LUIS ESPINAL, and ANTHONY MELO	Life in prison Mandatory minimum of 10 years in prison
2	Using or carrying a firearm during and in relation to, or possessing a firearm in furtherance of, a narcotics trafficking crime 18 U.S.C. § 924(c)	NEURY ABREU, ALEXANDER DEJESUS, JOSHUA PEREZ	Life in prison Mandatory minimum of 5 years in prison
3	Felon in possession of a firearm 18 U.S.C. § 922(g)(1)	JOSHUA PEREZ	10 years in prison
4	Felon in possession of a firearm 18 U.S.C. § 922(g)(1)	JOSHUA PEREZ	10 years in prison

 United States v. Alexander Melo, et al., 19 Cr. 818

COUNT	CHARGE	DEFENDANTS	MAX. PENALTIES
1	Narcotics trafficking conspiracy 21 U.S.C. § 846	ALEXANDER MELO, JAVIER JANIEL, FRANMY LUNA, and JUAN PERALTA,	Life in prison Mandatory minimum of 10 years in prison
2	Armed Career Criminal Act 18 U.S.C. §§ 922(g)(1) and 924(e)	ALEXANDER MELO	Life in prison Mandatory minimum of 15 years in prison

 United States v. Mario Delgado, et al., 19 Cr. 817

COUNT	CHARGE	DEFENDANTS	MAX. PENALTIES
1	Narcotics trafficking conspiracy 21 U.S.C. § 846	MARIO DELGADO, DANIEL CUEVAS, and EDWARD RODRIGUEZ	Life in prison Mandatory minimum of 10 years in prison

 United States v. Roberto Sanchez, et al., 19 Cr. 820

COUNT	CHARGE	DEFENDANTS	MAX. PENALTIES
1	Narcotics trafficking conspiracy 21 U.S.C. § 846	ROBERTO SANCHEZ, and JULIO ABREU	20 years in in prison

 United States v. Alberto Marte, 19 Cr. 795

COUNT	CHARGE	DEFENDANTS	MAX. PENALTIES
1	Narcotics trafficking conspiracy 21 U.S.C. § 846	ALBERTO MARTE, JUNIOR RODRIGUEZ, ERICK MELENCIANO, NICHOLAS FALU, KEVIN ROSADO, GUERY CRUZ, JONATHAN RODRIGUEZ, OMAR BAEZ, SAMUEL SOSA, YOAN DELACRUZ, RAYMER CASILLA, KEVIN MELENDEZ, JOSE BAUTISTA	20 years in prison
2	Using or carrying a firearm during and in relation to, or possessing a firearm in furtherance of, a narcotics trafficking crime 18 U.S.C. § 924(c)	ALBERTO MARTE, JUNIOR RODRIGUEZ, ERICK MELENCIANO, NICHOLAS FALU, KEVIN ROSADO, GUERY CRUZ, JONATHAN RODRIGUEZ, OMAR BAEZ, SAMUEL SOSA, YOAN DELACRUZ, RAYMER CASILLA, KEVIN MELENDEZ, JOSE BAUTISTA	Life in prison Mandatory minimum of 5 years in prison

[1] As the introductory phrase signifies, the entirety of the texts of the Indictments constitute only allegations, and every fact described herein should be treated as an allegation.

10 Defendants Charged In Manhattan Federal Court With Running Nationwide Telemarketing Fraud Scheme Targeting The Elderly

Defendants Allegedly Created and Used “Money Sucking Website” to Identify Vulnerable Victims Whom They Then Targeted and Victimized

  Geoffrey S. Berman, the United States Attorney for the Southern District of New York, Peter C. Fitzhugh, the Special Agent-in-Charge of the New York Field Office of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (“HSI”), and James P. O’Neill, Commissioner of the New York City Police Department (“NYPD”), announced the unsealing of an Indictment charging ANTHONY CHEEDIE, CHAD ALLEN, SHANE HANNA, CAMERON BREWSTER, KEVIN HANDREN, JOSEPH CIACCIO, a/k/a “Joseph Gallagher,” JOSEPH MINETTO, JOSEPH DEPAOLA, a/k/a “Joe Hall,” DERREK LARKIN, a/k/a “Derrek Martin,” and MATTIE CIRILO with conspiracy to commit wire fraud in connection with telemarketing.  LARKIN and CIRILO also are charged with obstruction of justice.  The case has been assigned to United States District Judge Victor Marrero.

Nine of the defendants were arrested this morning.  CHEEDIE, MINETTO, DEPAOLA, LARKIN, and CIRILO will be presented this afternoon in Manhattan federal court before United States Magistrate Judge Sarah Netburn.  ALLEN and HANNA will be presented this afternoon in Phoenix federal court before United States Magistrate Judge Deborah M. Fine.  BREWSTER will be presented this afternoon in Las Vegas federal court before United States Magistrate Judge Elayna J. Youchah.  HANDREN will be presented in Salt Lake City federal court before United States Magistrate Judge Evelyn J. Furse.  CIACCIO will be presented at a later date.

Manhattan U.S. Attorney Geoffrey S. Berman said: “As alleged, these 10 defendants, motivated by greed and the possibility of a quick payday, aggressively targeted the elderly and other vulnerable victims throughout the United States by convincing them to invest their money in various businesses, and then scammed those victims again after pushing them deep into debt.  In reality, allegedly these so-called opportunities were just fraudulent schemes to steal victims’ money, and the so-called ‘debt relief’ only further abused the trust innocent victims placed in the defendants.  Now, the defendants face time in prison for their alleged crimes.”

HSI Special Agent-in-Charge Peter C. Fitzhugh said:  “Those charged in this investigation are purported to have taken advantage of our aging population by posing as telemarketers.  This criminal organization allegedly strategically gave false promises to continue their swindle and get as much money as possible while destroying the lives of their victims.  HSI will not stand by while the elderly, or anyone else, are defrauded out of their hard earned money.  HSI and our law enforcement partners will continue to investigate and arrest those responsible to end their telemarketing scams.  Today, these individuals are done making calls unless they are calling their lawyer.”

Police Commissioner James P. O’Neill said:  “These charges reflect how criminals exploit the elderly and other individuals through telemarking schemes.  I commend the NYPD detectives, our federal partners, and prosecutors of the U.S. Attorney, Southern District, for their efforts and cooperation in this investigation.  Together, we will continue to be relentless in fighting crime that impacts the people we serve wherever, and however, it occurs.”

According to the allegations in the Indictment[1]:

The Business Opportunity Scheme

From at least 2012 until at least November 2019, CHEEDIE, ALLEN, HANNA, BREWSTER, HANDREN, CIACCIO, MINETTO, DEPAOLA, LARKIN, and CIRILO carried out a wide-ranging telemarketing scheme that defrauded hundreds of victims (the “Victims”) throughout the United States, many of whom were over age 70, by selling those Victims so-called “business services” in connection with the Victims’ purported online businesses (the “Business Opportunity Scheme”). 

To perpetrate the Business Opportunity Scheme, certain of the defendants and their co-conspirators sold “services” purporting to make the management of Victims’ businesses more efficient or profitable, including tax preparation or website design services, notwithstanding that many Victims were elderly and did not own a computer.  At the outset of the Business Opportunity Scheme, certain participants employed by a “fulfillment” company sent the Victims electronic or paper “pamphlets” or provided so-called “coaching sessions” regarding these purported online businesses, but at no point did the Victims actually earn any of the promised return on their intended investment. 

In order to perpetrate the Business Opportunity Scheme, the defendants and their co-conspirators engaged in a widespread, coordinated effort to traffic in lists of potential victims, or “leads,” many of whom had previously made an initial investment to create an online business with other participants in the Scheme.  As a general matter, leads were initially generated by sales floors operating in, among other places, Arizona, Nevada, and Utah, including those sales floors operated by ALLEN, HANNA, BREWSTER, and HANDREN.  ALLEN, HANNA, BREWSTER, and HANDREN operated in coordination with several telemarketing sales floors in the New York and New Jersey area, including in Manhattan, and provided lead lists and fulfillment services to other co-conspirators operating those floors, including CHEEDIE, CIACCIO, and MINETTO.  BREWSTER, for example, provided lead lists through a website referred to by BREWSTER and other co-conspirators as the “Money Sucking Website” or “MSW.”  CIACCIO and MINETTO employed several salespeople who sold the so-called business services to Victims of the Business Opportunity Scheme and worked to prevent Victims from receiving refunds on their investments, including DEPAOLA, LARKIN, and CIRILO.

Certain participants in the Business Opportunity Scheme, including ALLEN and HANNA, also told Victims that the Victims had qualified for a government grant, often in connection with starting a small business, and that the Victims should purchase the business services offered as part of the Business Opportunity Scheme as a way to earn money while waiting for the Victim’s grant money to be received.  In truth and in fact, no such government grants existed.

The Debt Relief Scheme

When there were no more services to sell the Victim as part of the Business Opportunity Scheme and/or the Victim had reached the maximum limit on his or her credit cards, the defendants and their co-conspirators effectively refinanced their Victims’ participation in the Business Opportunity Scheme into a new scheme, capitalizing on the Business Opportunity Scheme Victims’ credit card debts by offering to consolidate or settle the Victims’ debt in exchange for an up-front payment (the “Debt Relief Scheme”).  The perpetrators of the Debt Relief Scheme entered into revenue-sharing agreements with certain participants in the Business Opportunity Scheme by which the perpetrators of the Debt Relief Scheme paid certain participants for leads based on a percentage of the sales made to Victims.  In truth and in fact, the perpetrators of the Debt Relief Scheme did not settle or consolidate the Victims’ debt. 

Obstruction of Justice 

In or about January 2019, law enforcement conducted a search of the telemarketing sales floor at which LARKIN and CIRILO were employed.  During the search, law enforcement seized several electronic devices from LARKIN and CIRILO.  Following the search, LARKIN and CIRILO knowingly deleted, and attempted to delete, the data on those devices in an effort to prevent law enforcement from using that data in the instant investigation into the Business Opportunity Scheme.

CHEEDIE, 34, of Jersey City, New Jersey, ALLEN, 41, of Laveen, Arizona, HANNA, 40, of El Mirage, Arizona, BREWSTER, 39, of Las Vegas, Nevada, HANDREN, 37, of Sandy, Utah, CIACCIO, 30, of Hillsdale, New Jersey, MINETTO, 32, of Washington, New Jersey, DEPAOLA, 30, of Hillsdale, New Jersey, LARKIN, 36, of Elmwood Park, New Jersey, and CIRILO, 28, of Elmwood Park, New Jersey, are each charged with one count of conspiracy to commit wire fraud in connection with telemarketing through which they targeted and victimized 10 or more persons over the age of 55, which carries a maximum sentence of 30 years in prison.  LARKIN and CIRILO also are each charged with obstruction of justice, which carries a maximum sentence of 20 years in prison.  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.  

Mr. Berman praised the outstanding investigative work of HSI’s El Dorado Task Force and the NYPD. 

If you believe you have been a victim of the scheme described above, including a victim entitled to restitution, and you wish to provide information to law enforcement and/or receive notice of future developments in the case or additional information, please contact Wendy Olsen-Clancy, the Victim Witness Coordinator at the United States Attorney’s Office for the Southern District of New York, at 866-874-8900 or wendy.olsen@usdoj.gov.  You may also report it to Detective Christopher Bastos at 917-480-7167 or christopher.bastos@nypd.org.

 [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.

Attorney General James Announces Indictments Of Former Airline Executives In “Pay-To-Play" Bribery Scheme At JFK Airport

Former Ground Services International Head Allegedly Bribed British Airways Executive with $5 Million in Exchange for Promoting the Ground Handling Company Within the Airline 

  New York Attorney General Letitia James announced the indictment of former British Airways Executive Steven Clark, 61, of New York, NY, and former Ground Services International (GSI) CEO Jeff Kinsella, 59, of Naples, FL, for engaging in a multi-year commercial bribery and money laundering scheme at John F. Kennedy International Airport (JFK). Clark and Kinsella surrendered on multiple felony charges centered on allegations that Kinsella paid millions of dollars in bribes to Clark, former head of British Airways operations at JFK Terminal 7.

According to court filings and statements made by prosecutors, between 2011 and 2016, Kinsella allegedly paid more than $5 million to Clark for the purpose of influencing Clark’s conduct related to his position at British Airways. British Airways leases JFK Terminal 7 from the Port Authority of New York and New Jersey (Port Authority). Under this arrangement, British Airways selects service providers, such as GSI, that work at Terminal 7. Clark oversaw British Airways operations in the Americas and Asia, as well as British Airways operations at Terminal 7.

“Today’s indictment sends a clear message to airline companies and airport vendors: pay-to-play schemes will not fly in New York,” said Attorney General James. “For years, Kinsella, GSI’s former CEO and owner, and Clark, a former British Airways executive, broke the law and invalidated the trust of the millions of people that use Terminal 7 each year in an effort to line their own pockets. My office is committed to cracking down on public corruption and will continue to work with our partners at the Port Authority of NY & NJ to ensure public integrity and accountability throughout the area.” 

“Today’s announcement exposes a pay-to-play scheme that enabled Port Authority tenants and vendors to game the system and award business in exchange for payoffs and greed versus integrity and fairness," said Port Authority of NY & NJ Inspector General Michael Nestor. “The Port Authority of NY & NJ Office of Inspector General and the New York State Attorney General will work vigorously to identify and root out corruption and ensure that all tenants and contractors conducting business at our Port Authority facilities do so with the highest degree of honesty, integrity, and fairness.”

Kinsella and Clark engaged in a clandestine pay-to-play scheme at JFK to the detriment of British Airways, the Port Authority, airport employees, and travelers who pass through the busiest international airport in the United States. Most of the money was allegedly laundered from GSI through Danison Management LLC, a Kinsella company, and a shell company created by Clark named Naviance Consulting (Naviance). Kinsella allegedly paid Clark up to $18,000 per month for his promotion and protection of GSI within British Airways. Clark and Kinsella concealed these payments from British Airways by creating fake invoices, which Clark then used to bill GSI for illusory consulting services, concealing the true nature of the payments.

In addition to the monthly payments, Kinsella also allegedly granted Clark an undisclosed 5-percent ownership interest in GSI. Throughout 2006 and 2007, Clark advocated on behalf of GSI within British Airways, during which GSI was subsequently awarded contracts to provide lucrative ground handling services at Chicago and JFK Airport. After 2007, British Airways awarded GSI ground handling contracts at other airports in the United States as well as further expanding GSI’s duties at JFK. In 2016, after GSI was sold to Dnata — a ground handling company based in Dubai — Kinsella paid Clark $3.6 million for his 5-percent ownership interest. Clark never disclosed to British Airways his monthly payments from GSI and Kinsella or his undisclosed 5-percent ownership interest in GSI during the entire time he advocated on behalf of GSI within British Airways.   

JFK Terminal 1 is operated by a consortium of airlines, including Lufthansa, Air France, Japan Airlines, and Korean Air, known as the Terminal One Group Association (TOGA). Between 2015 and 2016, Kinsella allegedly paid more than $640,000 to a TOGA executive for the purpose of influencing that individual’s conduct related to their position at Terminal 1. The defendants are accused of laundering these payments through a shell company named Plane to Sea Consultant. Kinsella allegedly concealed these bribe payments from TOGA management by having the TOGA executive create fake invoices for consulting services that were never provided in order to pay the executive $20,000 per month. When Dnata was looking to buy GSI, Kinsella arranged for the TOGA executive to speak with Dnata on GSI’s behalf. The TOGA executive never revealed to Dnata that he received monthly payments of $20,000 per month from Kinsella. Kinsella then allegedly rewarded the TOGA executive with $120,000 for his help in securing GSI’s sale to Dnata. 

The indictment also alleges that between 2011 and 2017, Clark received more than $500,000 from another airport vendor for the purpose of influencing Clark’s conduct related to his position at British Airways. The vendor paid Clark $7,730 a month for non-existent consulting services that were concealed through the use of fake invoices. These payments were also allegedly laundered through Naviance. 

The defendants were arraigned in Queens County Supreme Court before Justice Barry Kron. A grand jury indicted Steven Clark on two counts of Money Laundering in the Second Degree, two counts of Commercial Bribe Receiving in the First Degree, three counts of Falsifying Business Records in the First Degree, and two counts of Conspiracy in the Fourth Degree. Jeff Kinsella was indicted on two counts of Money Laundering in the Second Degree, two counts of Commercial Bribing in the First Degree, four counts of Falsifying Business Records in the First Degree, and two counts of Conspiracy in the Fourth Degree.

The charges against Clark and Kinsella are merely allegations, and they are presumed innocent unless and until proven guilty in a court of law.

The Office of the Attorney General wishes to thank the Port Authority of New York and New Jersey – Office of the Inspector General for their partnership in investigating this case. Specifically, the Office of the Attorney General recognizes Port Authority – OIG Forensic Investigators Mia Chang, Jaime King, and Justin Meshulam; Supervising Investigator Fred Ferrone; Assistant Director of Investigations Salvatore Dalessandro; and Director of Investigations Steven Pasichow, for their assistance throughout the investigation.

Attorney General James Sues JUUL Labs

Alleges that JUUL Engaged in Deceptive Marketing Practices Targeting Minors; Company Misled Consumers About Nicotine Content; Misrepresented the Safety of JUUL Products 

   New York Attorney General Letitia James announced a lawsuit against the electronic cigarette company JUUL Labs, Inc. (JUUL) for deceptive and misleading marketing of its e-cigarettes, which contributed to the ongoing youth vaping epidemic in New York State. The lawsuit, filed in New York County Supreme Court, alleges that JUUL took a page from Big Tobacco’s playbook by engaging in deceptive business practices when marketing and advertising its products, and illegally sold its products to minors through its website and in third-party retail stores throughout the state, causing large numbers of New York youth to become addicted to nicotine. The suit also alleges that JUUL’s advertising campaign misled consumers by failing to warn that they contained nicotine, and by misrepresenting its products as a safer alternative to traditional cigarettes.

JUUL’s pervasive ad campaign, which included bright, colorful images of attractive, young models, appealed to underage youth. Through this ad campaign, JUUL contributed to an upsurge of youth e-cigarette use. The damage done by the company’s ads since its launch has already been felt by millions of youth across the country. The results of a recent National Youth Tobacco Survey show that approximately 4.1 million high school students and 1.2 million middle school students across the country currently use e-cigarettes. In New York, a third of high schoolers smoke e-cigarettes. JUUL currently represents 70 percent of the market share for e-cigarettes and is a dominant player in the industry.

“There can be no doubt that JUUL’s aggressive advertising has significantly contributed to the public health crisis that has left youth in New York and across the country addicted to its products,” said Attorney General James. “By glamorizing vaping, while at the same time downplaying the nicotine found in vaping products, JUUL is putting countless New Yorkers at risk. I am prepared to use every legal tool in our arsenal to protect the health and safety of our youth.”  

The lawsuit alleges that JUUL’s conduct violates General Business Law §§ 349 and 350, which prohibit deceptive acts and practices and false advertising; Common Law Public Nuisance, which prohibits substantial and unreasonable interference with the public health; and Executive Law § 63(12), which prohibits repeated and persistent fraud and illegality, based on violations of the New York Public Health Law prohibiting underage sales of tobacco products to minors. Additionally, JUUL allegedly violated the Federal Trade Commission Act §5 prohibiting unfair business practices that substantially injure consumers, and the Food, Drug & Cosmetic Act 21 U.S.C. § 387k, prohibiting the introduction into interstate commerce of any modified risk tobacco product without an order from the Secretary of Health & Human Services.

As of November 13, 2019, New York State law was changed, making it illegal to sell nicotine products, including e-cigarettes, to consumers who are under 21-year-old. Previously, the law applied to consumers younger than age 18. Despite this prohibition, JUUL violated the law by selling its products to New Yorkers under the age of 18.

When JUUL launched in 2015, New York consumers were introduced to the company through targeted launch parties held in New York City and the Hamptons. Taking a page from Big Tobacco’s playbook, its ad campaigns featured young, attractive models, accompanied by the catchy phrase, “Vaporized,” with corresponding social media hashtags, including #Vaporized, #JUUL, #LightsCameraVapor, and #JUULvapor. JUUL further attracted teenagers by selling flavored products, and by failing to advertise the nicotine content in its products. Nicotine is highly addictive and harmful to young people. In subsequent years, JUUL’s social media presence continued to focus heavily on attracting young audiences. A 2018 study found that approximately 45 percent of the individuals who were following the official @JUULvapor Twitter account in April 2018 were between the ages of 13 and 17, while only 20 percent of followers were 21 or over.

In addition to marketing to young New Yorkers, JUUL engaged in direct outreach to high school students, including in at least one New York City school, where a JUUL representative falsely stated to high school freshmen that its products were safer than cigarettes. JUUL’s pervasive launch and ad campaign reached teenagers across the country, who then introduced JUUL’s products to their peers in rapid numbers. By 2017, JUUL’s products were ubiquitous in schools around the country.

The New York State Department of Health (DOH) estimates that 1 million residents use e-cigarette products on a regular basis – 220,000 of those users are under 18-years-old. To date, there have been 42 deaths and 2,172 cases of severe vaping-related illnesses nationwide, including 146 New Yorkers who have suffered vaping-related illnesses. In October 2019, a 17-year-old male from the Bronx died due to a vaping-related illness, making that the first reported vaping-related fatality in New York, and the youngest vaping-related fatality in the United States.  

Senate Majority Announces Joint Public Hearing On Housing Discrimination

The Senate announced that the Senate Standing Committees on Housing, Consumer Protections, and Investigation and Government Operations, will hold a joint public hearing on housing discrimination on Long Island. This hearing is a direct response to a Newsday investigation that revealed racial discrimination and evidence of unequal treatment by real estate agents. Senate Committee Chairs, Brian Kavanagh, Kevin Thomas, and James Skoufis will co-chair this hearing on Long Island. The hearing will take place on Thursday, December 12 at 10:00 AM at the Theodore Roosevelt Executive and Legislative Building in Nassau County.

“There is no place in New York for discrimination and predatory practices. The Newsday investigation uncovered a disturbing and unacceptable situation that is denying New Yorkers fair housing opportunities,” Senator Majority Leader Andrea Stewart-Cousins said. “The Senate Democratic Majority will be looking into this, and I applaud Senators Brian Kavanagh, James Skoufis, and Kevin Thomas for quickly organizing their committees to set up a hearing on this issue. This hearing will help the Senate Majority address this situation and these unfair housing practices over the coming Legislative Session.”

Senator Brian Kavanagh, Chair of the Senate Standing Committee on Housing said, “Housing discrimination is unacceptable and illegal, and the results of Newsday's investigation are alarming and deserve immediate attention. I look forward to working with my colleagues to investigate the situation and identify steps we can take to prevent discrimination and protect all New Yorkers' rights to fair access to housing.”

Senator James Skoufis, Chair of the Senate Standing Committee on Investigations and Government Operations said, “The disturbing results of this three-year examination by Newsday makes it glaringly clear that the State must respond to this situation and immediately prioritize accountability. What’s happening on Long Island is likely happening in other parts of the state as well and our Senate will not stand by while New Yorkers are discriminated against in the very place they call home. I look forward to co-chairing the upcoming hearing with my colleagues and shining a light on what exactly happened and what our next steps must be.”

Statement by Speaker Corey Johnson on Signing of Streets Master Plan Legislation into Law

“We take a giant leap closer to reclaiming our streets and making them safer for our residents. The Streets Master Plan, now signed into law, will revolutionize the way New Yorkers use our streets, creating more bus and bike lanes, more pedestrian space and safer street infrastructure. This law helps us make alternative transportation options more viable, which is necessary in our fight against climate change. Today would not have been possible without the hard work of transportation and street safety advocates, including families who lost love ones on our dangerous streets. Their persistence and passion led to a plan that will ultimately make New York City a more enjoyable place to live, work and play. New Yorkers for generations to come will be safer because of them.”

Comptroller Stringer: Proposed SEC Rule Change a Transparent Threat by Corporate Executives to Shareholder Rights

New York City Comptroller Scott M. Stringer submitted a comment letter to the U.S. Securities and Exchange Commission (SEC) detailing his strong opposition to the proposed amendments to how shareholders, such as the New York City Retirement Systems (NYCRS), express concerns and hold companies accountable to long-term sustainable growth. Comptroller Stringer further called on the SEC to extend the comment period for the proposed amendments – “Amendments to Exemptions from the Proxy Voting Rules for Proxy Voting Advise” and “Procedural Requirements and Resubmission Thresholds under Exchange Act Rule 14a-8” – from 60 days to 120 days to allow investors to properly respond to the changes which include a total of 320 pages and hundreds of individual questions.

The proposed changes impact the Comptroller’s office’s capacity to vote on shareholder proposals and other ballot items at the companies that the NYCRS invest in – a crucial responsibility that enables investors to advocate for sound corporate governance and responsible business practices at portfolio companies – by compromising the independence of research by proxy advisory firms, reducing the amount of time available to review ballot items, and imposing additional burdens.

In the letter, Comptroller Stringer called into question the motivations behind the proposals, writing, that “to state the obvious, it is not the institutional investors who pay for and rely upon proxy advisor research who are calling for onerous regulation of proxy advisory firms. Instead, the impetus is coming from those who are the subject of their analysis, namely board members, corporate executives (and their lobbying organizations), who don’t like their performance or pay criticized.”

Comptroller Stringer further said, “the Proposal, individually and in combination with the proposed Shareholder Proposal Rule, seeks to remedy problems that do not exist and will radically tilt an already uneven playing field further in favor of corporate management and away from investors, such as the NYCRS, who actively and responsibly exercise our longstanding rights to cast informed proxy votes and to submit shareowner proposals to hold companies accountable for runaway CEO pay, excessive risk taking and irresponsible and harmful business practices.”

“The two proposals are, in effect, a two-pronged attack on rights – proxy voting and shareowner proposals – that form the heart of the NYCRS Corporate Governance Program and that the NYCRS have long relied upon to advocate for sound corporate governance and responsible and accountable business practices at our portfolio companies. We believe the NYCRS Corporate Governance Program creates and protect long-term shareholder value on behalf of our participants and beneficiaries, and to the benefit of all investors,” he added.

MAYOR DE BLASIO SIGNS LANDMARK LEGISLATION TO REFORM COMMERCIAL WASTE COLLECTION INDUSTRY

New legislation caps years-long effort to create commercial waste zones, bringing environmental justice to industry and making it safer for cyclists, pedestrians, and workers

 Mayor Bill de Blasio today signed legislation that will radically overhaul the City’s commercial waste program, bringing much needed reform to an industry known for dangerous, unhealthy and unsustainable conditions. Intro 1574-A, sponsored by Council Member Antonio Reynoso, will create a safe and efficient commercial waste collection system that will advance the City’s Green New Deal and zero waste goals while providing high-quality, low-cost service to New York City businesses.

The Mayor signed the Commercial Waste Zones legislation and several other pieces of legislation overseeing the Trade Waste Industry at an event at El Puente in Williamsburg.

“Today’s bill signing doesn’t just mark a new day for commercial waste hauling,” said Mayor Bill de Blasio. “It’s a new day for New York’s Green New Deal, showing that we can create good-paying jobs while drastically reducing pollution and emissions. It’s a new day for working people – many of whom are immigrants chasing the American dream – ending the race to the bottom that has led to low labor standards and poor wages. It’s a new day for safety on our streets, whether you’re on the truck or biking next to it. And it’s a new day for New York City. I’d like to thank Council Member Reynoso and the City Council for helping us get to this day.”

“Today has been years in the making and is a monumental shift that will transform an industry that touches the lives of all New Yorkers,” said Deputy Mayor Laura Anglin. “This bill will not only lead to better paying and safer jobs for those working in the commercial waste hauling industry, but will dramatically reduce truck traffic, improve the air quality, and make our streets safer.”

“This day has been years in the making. Commercial waste zones will fundamentally transform an industry that is critical to our city and do so while protecting workers’ rights, improving safety for the public, and taking on the climate crisis,” said Sanitation Commissioner Kathryn Garcia. “This program will cut truck traffic by more than 50 percent and encourage businesses to recycle and compost more. This groundbreaking legislation would not have been possible without the support of the Mayor, the work by the Council, and the tireless efforts by advocates.”

“Today’s landmark law is a big win for the environment and a real a game-changer for traffic safety and New York City’s efforts around Vision Zero,” said Transportation Commissioner Polly Trottenberg. “This year alone, we have seen three pedestrians, three cyclists, and two motorcyclists struck and killed in crashes with reckless commercial-waste vehicles.  By dramatically reducing the number of truck-miles traveled, this new law will undoubtedly save lives on our streets.  I congratulate the Mayor as well as Commissioners Garcia and Genel for their steadfast leadership achieving this new law, with special thanks to Councilmember Reynoso and the entire Council for seeing the effort through.”

“BIC was created to root out corruption in the trade waste industry,” said Noah D. Genel, Commissioner and Chair of the Business Integrity Commission. “Intro 1573-A adds safety – and particularly traffic safety – to our mandate.  Now, BIC will be empowered to more closely regulate safety in the trade waste industry on the City’s streets and to consider an applicant’s safety record in making licensing decisions.  Trade waste companies must prioritize safety over speed.  Slow down; drive defensively; share the road.  Together with Intro 1574-A and working with the Department of Sanitation and our other City and community partners in this effort, we will continue to improve this industry.”

While the NYC Department of Sanitation (DSNY) collects trash and recycling from residents, more than 90 different private carters have crisscrossed the city each night for decades to service the city’s 100,000 commercial businesses, driving long, overlapping and unsafe routes. This system has created myriad issues for New Yorkers, whether creating public health hazards and a major source of greenhouse gas emissions, creating a race to the bottom of poor labor standards, or creating public safety risks for cyclists, pedestrians, and workers alike. Since 2010, 28 New Yorkers have been killed by private carters.

The Commercial Waste Zones program will dramatically improve safety and working conditions for workers in this industry. The law imposes training requirements for drivers, helpers and other commercial waste employees, and calls for the creation of a Safety Task Force jointly appointed by the Administration and Council to make recommendations on further steps to protect the safety of workers and the public. It also establishes a displaced worker list, promotes local hiring and includes protections for employees of certain companies undergoing merger or acquisition. 

The law divides the city into 20 zones, each served by up to three carters selected through a competitive bidding process. Five carters citywide, will also be selected to collect containerized waste from dumpsters and compactors. Commercial waste zones will reduce truck traffic and mileage associated with commercial waste collection by more than 50 percent, while strengthening service standards and preserving customer choice.

The law also requires that selected haulers provide recycling and organics collection at a discount to incentivize waste diversion; promotes the use of low-emission or zero emission collection trucks; and incentivizes the use of transfer stations that use rail or barge transport or are located near the designated zones.

Following today’s bill signing the City will begin program implementation, starting with formally defining the geographical boundaries of the zones. Next year, DSNY will release a request for proposals from interested and qualified waste haulers, which will be evaluated on the basis of several factors outlined in the law. DSNY expects to begin a multi-year customer transition process in 2021.

At today’s ceremony, the Mayor also signed three additional bills to improve safety and oversight over the trade waste industry:

Intro 1573-A expands the Business Integrity Commission’s authority to establish environmental, safety and health standards for trade waste carters;

Intro 1083-A imposes fines on trade waste companies that fail to report employees to BIC including a minimum of $1,000 and maximum of $10,000 for each unreported individual; and

Intro 1082-A requires commercial waste collection trucks be equipped with global positioning systems (GPS) that can transmit data on location and speed.

  

"Today marks a sea change in how New York City deals with its commercial waste. Intro. No. 1574-A becoming law means that our air will be cleaner, our streets will be safer, and customer service to businesses throughout the city will be improved. The private carting industry has operated without proper safeguards concerning air quality and street safety for far too long and sprawling, inefficient collection routes have resulted in millions of excess truck miles driven every year. This law is a huge step forward in fixing this broken practice." said Council Speaker Corey Johnson

“Today's bill signing marks the beginning of a new era in the private carting industry,” said Council Member Antonio Reynoso, Chair of the Committee on Sanitation and Solid Waste Management. “Under a commercial waste zones system, vehicle miles traveled will be drastically reduced, companies will be required to provide training to workers, and haulers will be incentivized to make critical investments in modern recycling, composting, and transfer station infrastructure. The transformation of this industry will have life changing impacts for workers, community members, and our environment. I am grateful for Speaker Corey Johnson, my Council Colleagues, and the advocates who were instrumental in the passage of this bill and want to thank Mayor de Blasio and Commissioner Garcia for their dedication in implementing this vision."