The longtime head of the city correction officers union steered $20 million in funds into a risky hedge fund in exchange for a $60,000 cash kickback that was stuffed into a brand-new Salvatore Ferragamo bag, the feds charged on Wednesday.
Norman Seabrook — who drunkenly declared it was time he “got paid” for investing his union’s funds — and Platinum Partners founder Murray Huberfeld were charged with conspiracy and honest-services fraud for what Manhattan US Attorney Preet Bharara called “a very simple and straightforward quid pro quo.”
Both men face a maximum 40 years if convicted on both counts.
The feds say the scam was cooked up in late 2013 during a trip to the Dominican Republic paid for by a cooperating witness — identified by sources as real estate investor and Mayor Bill de Blasio donor Jona Rechnitz.
During a night of heavy drinking, Seabrook — who’s run the Correction Officers’ Benevolent Association for the past 21 years — complained to Rechnitz that he worked hard to invest his union’s money.
He said it was time that “Norman Seabrook got paid,” according to the court papers.
Rechnitz then allegedly worked out an arrangement in which Seabrook would hand over a huge chunk of COBA’s cash funds to Platinum for 10 percent of its profit share, or an estimated $100,000 to $150,000 a year.
Seabrook and Huberfeld later sealed the deal and COBA made an initial investment of $10 million worth of pension funds in March 2014 — the same month that Rechnitz paid for Seabrook to join him on a trip to Israel, according to the feds.
Also on that trip was then-NYPD Chief of Department Philip Banks — who had introduced Seabrook to Rechnitz — and Rechnitz pal Jeremy Reichberg, who sources said is identified in court papers as an uncharged co-conspirator in the case.
Banks’ lawyer, Ben Brafman, said his client “has no knowledge about the conduct alleged in today’s complaint and had absolutely no involvement whatsoever in the criminal conduct charged.”
Reichberg’s lawyer, Susan Necheles, didn’t immediately return a request for comment.
Seabrook allegedly invested a total of $15 million worth of COBA’s pension money with Platinum, and another $5 million in operating funds — which left the union with just over $3 million in cash on hand.
Near the end of 2014, Seabrook demanded his first kickback, court papers say.
Rechnitz agreed to front the money, which the feds say he put into an $820 Ferragamo bag — described by one source as a black “murse,” or men’s purse. Ferragamo is described in court papers as “Seabrook’s favorite luxury goods store.”
FBI agents seized the bag, along with 10 pairs of Ferragamo shoes, from Seabrook’s Bronx home following his arrest there early Wednesday, Bharara said.
In order to reimburse Rechnitz for the payoff, the feds say Huberfeld had him create a phony receipt claiming that Platinum purchased some of Rechnitz’s Knicks season tickets.
A $60,000 invoice allegedly drafted by Rechnitz’s assistant on Dec. 11, 2014, said the money paid for two seats to each of “8 Knicks games @7500 per game.”
“At the time of this supposed payment of $7,500 per game, the New York Knicks’ record was 4-20,” a footnote in the criminal complaint says.
Despite his taste for fine accessories, Seabrook appeared in court wearing leather flip-flops, baggy jeans and a button-down shirt, after refusing to don a suit that a female supporter brought for him.
Manhattan federal Magistrate Judge Kevin Fox agreed to release him without bail.
But the feds appealed the ruling to federal Judge Jesse Furman, who set bond at $250,000.
Seabrook left the courthouse with a big grin on his face and said, “I feel like a million dollars. One million.”
Upon returning to his home — which neighbors said was recently renovated — he fired up a cigar and took a stroll down the block before retreating to his fenced-in back yard.
Additional reporting by Kevin Sheehan, Frank Rosario and Vinita Singla
Keep these in mind as you contemplate the direction of the American government over the past 50 years and especially since the Obama election.
The Goals of Communism
(as read into the congressional record January 10, 1963, from "The Naked Communist" by Cleon Skousen)
1. U.S. acceptance of coexistence as the only alternative to atomic war.
2. U.S. willingness to capitulate in preference to engaging in atomic war.
3. Develop the illusion that total disarmament of the United States would be a demonstration of moral strength.
4. Permit free trade between all nations regardless of Communist affiliation and regardless of whether or not items could be used for war.
5. Extension of long-term loans to Russia and Soviet satellites.
6. Provide American aid to all nations regardless of Communist domination.
7. Grant recognition of Red China. Admission of Red China to the U.N.
8. Set up East and West Germany as separate states in spite of Khrushchev's promise in 1955 to settle the German question by free elections under supervision of the U.N.
9. Prolong the conferences to ban atomic tests because the United States has agreed to suspend tests as long as negotiations are in progress.
10. Allow all Soviet satellites individual representation in the U.N.
11. Promote the U.N. as the only hope for mankind. If its charter is rewritten, demand that it be set up as a one-world government with its own independent armed forces. (Some Communist leaders believe the world can be taken over as easily by the U.N. as by Moscow. Sometimes these two centers compete with each other as they are now doing in the Congo.)
12. Resist any attempt to outlaw the Communist Party.
13. Do away with all loyalty oaths.
14. Continue giving Russia access to the U.S. Patent Office.
15. Capture one or both of the political parties in the United States.
16. Use technical decisions of the courts to weaken basic American institutions by claiming their activities violate civil rights.
17. Get control of the schools. Use them as transmission belts for socialism and current Communist propaganda. Soften the curriculum. Get control of teachers' associations. Put the party line in textbooks.
18. Gain control of all student newspapers.
19. Use student riots to foment public protests against programs or organizations which are under Communist attack.
20. Infiltrate the press. Get control of book-review assignments, editorial writing, policymaking positions.
21. Gain control of key positions in radio, TV, and motion pictures.
22. Continue discrediting American culture by degrading all forms of artistic expression. An American Communist cell was told to "eliminate all good sculpture from parks and buildings, substitute shapeless, awkward and meaningless forms."
23. Control art critics and directors of art museums. "Our plan is to promote ugliness, repulsive, meaningless art."
24. Eliminate all laws governing obscenity by calling them "censorship" and a violation of free speech and free press.
25. Break down cultural standards of morality by promoting pornography and obscenity in books, magazines, motion pictures, radio, and TV.
26. Present homosexuality, degeneracy and promiscuity as "normal, natural, healthy."
27. Infiltrate the churches and replace revealed religion with "social" religion. Discredit the Bible and emphasize the need for intellectual maturity which does not need a "religious crutch."
28. Eliminate prayer or any phase of religious expression in the schools on the ground that it violates the principle of "separation of church and state."
29. Discredit the American Constitution by calling it inadequate, old-fashioned, out of step with modern needs, a hindrance to cooperation between nations on a worldwide basis.
30. Discredit the American Founding Fathers. Present them as selfish aristocrats who had no concern for the "common man."
31. Belittle all forms of American culture and discourage the teaching of American history on the ground that it was only a minor part of the "big picture." Give more emphasis to Russian history since the Communists took over.
32. Support any socialist movement to give centralized control over any part of the culture--education, social agencies, welfare programs, mental health clinics, etc.
33. Eliminate all laws or procedures which interfere with the operation of the Communist apparatus.
34. Eliminate the House Committee on Un-American Activities.
35. Discredit and eventually dismantle the FBI.
36. Infiltrate and gain control of more unions.
37. Infiltrate and gain control of big business.
38. Transfer some of the powers of arrest from the police to social agencies. Treat all behavioral problems as psychiatric disorders which no one but psychiatrists can understand.
39. Dominate the psychiatric profession and use mental health laws as a means of gaining coercive control over those who oppose Communist goals.
40. Discredit the family as an institution. Encourage promiscuity and easy divorce.
41. Emphasize the need to raise children away from the negative influence of parents. Attribute prejudices, mental blocks and retarding of children to suppressive influence of parents.
42. Create the impression that violence and insurrection are legitimate aspects of the American tradition; that students and special-interest groups should rise up and use united force to solve economic, political or social problems.
43. Overthrow all colonial governments before native populations are ready for self-government.
44. Internationalize the Panama Canal.
45. Repeal the Connally reservation so the United States cannot prevent the World Court from seizing jurisdiction over nations and individuals alike.
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