Federal prosecutors have charged 70 current and former New York City Housing Authority employees. After a corruption investigation, law enforcement agents arrested the suspects for bribery and extortion.
Prosecutors say that the suspects demanded and collected kickbacks from contractors in exchange for contracts. In the process, the suspects sidelined competent contractors who could have done a better job.
U.S. Attorney Damian Williams had this to say about the case. “Instead of acting in the interest of NYCHA residents, the City of New York, or taxpayers, the 70 defendants…used their jobs at NYCHA to line their pockets.” Reports say the suspects collectively received up to $2 million in bribes.
“This action is the largest single takedown in the history of the justice department,” Williams announced. “We were trying to send a message with a 70-person takedown,” the attorney also said.
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The suspects were Superintendents and Assistant Superintendents at close to 100 New York City public housing facilities. They awarded jobs that cost less than $10,000 and required no bidding to contractors for a fee.
“This was classic pay-to-play,” Williams said of the practice that began in 2013 and continued up until 2023. “This conduct became a regular practice,” she continued. Contractors who refused to play ball had their engagements with the authority canceled.
The hunt for the suspects took federal agents in collaboration with Homeland Security Investigations to six states and all five boroughs. The States include New Jersey, North Carolina, and Connecticut.
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The Housing Authority promptly placed all the charged suspects under suspension. New York City’s Department of Investigation says the practices badly damaged the image of the Housing Authority. It also led to the loss of funds for the government and a hike in the costs of the facilities.
In its statement, the Department of Justice announced the sealing of the complaints. The complaint reminded readers that the NYCHA is the largest public housing authority in the United States.
The housing authority, therefore, bore the huge responsibility of providing accommodation to the most populated city in the country. Over 5% of NYC’s people depend on the NYCHA. This number amounts to more than 500,000 residents.
The complaint further explained that the housing authority needed external contractors for many of its projects. The rules require the authority to receive bids from contractors and pick the best fit to get the right hands.
But another rule exempts projects that cost less than $10,000 from this transparent process. The employees feasted on the opportunity they found in these no-bid contracts to make illegal money.
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The defendants collect the bribes before they award the contracts. In other cases, the bribery occurs after the contractor finishes the job and requires the employee’s signature to certify the completion.
The complaint further revealed that the defendants solicited up to 10 to 20% of the contract’s worth. Some of the more greedy employees asked for more than that.
In collaboration with law enforcement, authorities have vowed to fish out the perpetrators of other irregularities in the public service. Hopefully, they could restore some of the battered confidence the housing authority once enjoyed.
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