The charges against the union leader, Norman Seabrook, and a second defendant, Murray Huberfeld, a hedge-fund financier, represent the first major criminal case linked to one of several corruption investigations that are focused on the campaign fund-raising of Mayor Bill de Blasio, a Democrat. The Southern District of NY alleged Seabrook received a $60,000 bribe – all cash, in a stuffed Ferragamo bag – to invest COBA money with the fund.
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Shortly after Rechnitz introduced Seabrook and Huberfeld in December 2013, union lawyers sent a letter to Huberfeld expressing interest in investing $10 million in union annuity funds in a Platinum fund, the complaint says. Seabrook was the only candidate running in an upcoming union election.
Union representatives didn’t immediately respond to comment requests. Huberfeld said the fund had not performed as well as thought and he could only pay Seabrook $60,000.
Now the two men are charged with one count of honest service wires fraud and one count of conspiracy to commit honest services wire fraud.
Prosecutors say Huberfeld’s initial bribe was brokered by the witness, who allegedly fronted Huberfeld the $60,000 for Seabrook’s first installment. Several high-ranking officers have been reassigned or disciplined as a result of the probe.
The New York Times reported this morning that the cooperating witness is Jona S. Rechnitz, a real estate developer and de Blasio fundraiser whose name has repeatedly turned up during the corruption investigation. The complaint indicated that Rechnitz, who is described only as a “cooperating witness”, is continuing to provide information to government investigators in the hopes of securing a reduced sentence.
Union President Norman Seabrook initiated an “explicit bribery scheme” with a leader of Platinum Partners, the Manhattan US attorney’s office alleged. Platinum founder Mark Nordlicht could not be reached for comment on Wednesday.
It is also the latest high-profile public corruption case brought by the office of Preet Bharara, the United States attorney in Manhattan. Seabrook complained to the witness that he worked hard to invest the union’s money but made none for himself, the complaint said.
Allegedly, Huberfeld agreed and created a formula in which Seabrook would receive a kickback of a portion of the profits from COBA’s investment that Huberfeld estimated could range from $100,000 to $150,00 annually.
It was time “Norman Seabrook got paid”, he told CW-1, according to the complaint.
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Authorities said the witness helped orchestrate a fraud scheme in which Huberfeld promised to return half of Platinum’s 20 per cent commission to Seabrook as a kickback.
