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NYS Politicians Indicted on Public Corruption Charges

NYS Politicians Indicted on Public Corruption Charges

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Published by Samuel L. Rivers

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Published by: Samuel L. Rivers on Mar 10, 2011
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09/04/2014

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United States AttorneySouthern District of New York
FOR IMMEDIATE RELEASE CONTACT: U.S. ATTORNEY'S OFFICEMARCH 10, 2011 ELLEN DAVIS, JERIKA RICHARDSONCARLY SULLIVAN, EDELI RIVERA PUBLIC INFORMATION OFFICE(212) 637-2600FBIJIM MARGOLIN, (212) 384-2720OFFICE OF PUBLIC AFFAIRS(212) 384-2100
MANHATTAN U.S. ATTORNEY ANNOUNCES FEDERAL CORRUPTIONCHARGES AGAINST TWO MEMBERS OF THE NEW YORKSTATE LEGISLATURE
Six Others Charged In Bribery Schemes, Including Albany Lobbyist,Two Hospital CEOs, Healthcare Consultant,and Real Estate Developer 
PREET BHARARA, United States Attorney for the SouthernDistrict of New York, and JANICE K. FEDARCYK, the AssistantDirector-in-Charge of the New York Office of the Federal Bureauof Investigation ("FBI"), announced today the unsealing of aComplaint charging New York State Senator CARL KRUGER and StateAssemblyman WILLIAM BOYLAND, JR., with accepting bribes inexchange for official acts. KRUGER is charged with taking morethan $1 million in bribes from, among others, lobbyist RICHARDLIPSKY, real estate developer AARON MALINSKY, and health careconsultant SOLOMON KALISH, all of whom are also charged. DAVIDROSEN, the CEO of the MediSys Health Network, is also chargedwith conspiring to bribe KRUGER, as well as with paying over$177,000 in bribes to New York State Assemblyman WILLIAM BOYLAND,JR., and $390,000 in bribes to former New York State AssemblymanAnthony Seminerio, in exchange for their official acts. ROBERTAQUINO, the former CEO of Parkway Hospital in Queens, New York,is also charged with bribing KRUGER. MICHAEL TURANO, aManhattan-based gynecologist, is charged with laundering KRUGER'sbribes through two shell companies TURANO established for thebenefit of himself, KRUGER, and others. Each of the eightdefendants voluntarily surrendered this morning. They areexpected to be presented in Manhattan federal court later today.Manhattan U.S. Attorney PREET BHARARA said: "Today'sComplaint filed in Manhattan Federal Court describes abroad-based bribery racket reflecting an unholy alliance ofpoliticians, lobbyists, and businessmen. Every single time we
 
arrest a state Senator or Assemblyman, it should be a jarringwake-up call. Instead, it seems that no matter how many timesthe alarm goes off, Albany just hits the snooze button. Maybethis time they will get the message."FBI Assistant Director-in-Charge JANICE K. FEDARCYKsaid: "The Complaint lays out a roadmap of bribery, moneylaundering, influence-peddling and official misconduct that iseye-opening even to seasoned investigators. The web of graft andcorruption, of buying and selling influence, is not whatrepresentative democracy is supposed to look like. The FBIremains committed to rooting out official corruption wherever itexists."According to the Complaint unsealed today in Manhattanfederal court:The Alleged KRUGER Bribery ConspiracyCARL KRUGER has served as a member of the New YorkState Senate since 1994, representing Bergen Beach, Flatlands,Mill Basin, and other communities in the 27th Senate District.From at least 2006 through March 2011, KRUGER received a streamof bribes totaling at least $1 million in exchange for takingofficial actions on behalf of the bribe payers as opportunitiesarose. Rather than receive these corrupt payments directly,KRUGER funneled them to the bank accounts of two shell companiesestablished by MICHAEL TURANO –- Olympian Strategic DevelopmentCorp. ("Olympian") and Bassett Brokerage ("Bassett"). KRUGER hadan intimate relationship with the TURANO family. He acted andwas treated in many ways like a member of the family. Amongother things, KRUGER spent his free time with the Turanos, sharedholidays with them, went shopping for them, and managed theaffairs of their residence. Of all the TURANOS, KRUGER wasclosest with MICHAEL TURANO. The two men were in nearly dailycontact, KRUGER picked TURANO up from work, and people evencalled KRUGER's cellphone in order to reach TURANO. MICHAELTURANO used the money deposited in Olympian and Bassett to paythe lease on a Bentley automobile, pay his credit card bills, andpay off the mortgage on the multi-million dollar home that heshared with his mother and brother.As alleged in the Complaint, between 2006 and 2011,KRUGER received a stream of bribes from, among others: (1)RICHARD LIPSKY, a lobbyist and the principal of Richard LipskyAssociates, Inc.; (2) AARON MALINSKY, the principal of P/AAssociates LLC, a real estate development firm; and (3) SOLOMONKALISH, the owner and operator of Adex Management, Inc. ("Adex"),a marketing/consulting firm that brokered relationships in thehealthcare industry.-2-
 
LIPSKY directed approximately $252,000 of his lobbyingfees to the Olympian account in exchange for which KRUGER tookofficial actions to benefit LIPSKY's clients. His actionsincluded sponsoring and supporting legislation, lobbying otherelected officials, and directing state monies for the benefit ofLIPSKY and his clients. For example, KRUGER supported the awardof millions of dollars in state funds to certain developmentprojects that were being undertaken by a key client of LIPSKY's.He even wrote a letter to a judge on behalf of one of LIPSKY'sclients. MALINSKY, through P/A Associates, caused a stream ofpayments to be made to Olympian totaling approximately $472,500.In exchange for these payments, KRUGER took official action tobenefit MALINSKY's interest in a certain real estate developmentproject in Brooklyn, including taking positions at a publichearing in favor of that project.Through Adex, KALISH directed approximately $197,000 toOlympian in exchange for KRUGER's taking official action. Forexample, as alleged in the Complaint, in the summer of 2008,ROBERT AQUINO, then the CEO of Parkway Hospital, paid Adexapproximately $60,000 –- half of which KALISH then directed tothe Olympian bank account -– so that KRUGER would lobby New YorkState officials in connection with Parkway Hospital's efforts toacquire certain other hospitals, namely the Caritas Hospitals.In 2008, DAVID ROSEN similarly attempted to bribe KRUGER inconnection with efforts by MediSys to acquire the same hospitals.To that end, ROSEN caused Brookdale Hospital to hire a certainthird party hospice care provider, knowing that KRUGER had aninterest in it. That interest was manifested by an arrangementwith Adex pursuant to which Adex was paid for helping to securebusiness for the hospice care provider. The contractualnegotiation between Brookdale Hospital and the hospice careprovider appears to have been terminated, however, when AnthonySeminerio was arrested.The Alleged ROSEN Bribery ConspiracyAccording to the Complaint, KRUGER was one of threeelected officials that DAVID ROSEN sought to bribe. In additionto KRUGER, ROSEN also is alleged to have made or caused corruptpayments to Anthony Seminerio and WILLIAM BOYLAND, JR.Specifically, between 1999 and 2008, ROSEN caused MediSys or itsaffiliates to make approximately $390,000 in payments toSeminerio through a sham consulting company, Marc Consultants,that Seminerio had established. In exchange for receiving thesepayments, Seminerio advocated with New York State agenciesconcerning the discharge of a $19,000,000 loan in 2006,co-sponsored legislation to provide a secured financing option to-3-

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