NY bribery arrests: Real estate deals offer tempting payoffs for greedy
Land deals like the one that led to last week's arrest of Spring Valley's top two elected officials are the steady diet of planning boards and town governments across Rockland County, providing plenty of get-rich-quick opportunities for those interested in lining their pockets while pretending to do the public's work, according to community activists and law enforcement officials.
In villages like Spring Valley and towns like Ramapo and Clarkstown, the real estate business offers relative newcomers enough financial leverage to make a quick killing. At the same time, it requires relatively little real expertise and experience.
Home ownership and sublets have led on to more ambitious investments and to dalliance with illegal schemes that can radically increase profits in real estate for the most ambitious in Rockland's diverse ethnic mix.
In this superheated environment, where million-dollar deals are coming before town governments almost daily, local lawmakers wield absolute power over what gets built and what doesn't.
"You have the confluence of the development, political power and in this case corruption," said Michael Castelluccio, an activist with the group Preserve Ramapo. "In terms of politics, it is one gigantic dirtbag circus that's alternately depressing and comical. But it's a mess."
Gadflies say the system is dominated by partisan political officials who eagerly snatch up appointments to planning and zoning boards where they get to weigh in on multi-million dollar deals.
HISTORY OF CRIMINALITY AROUND REAL ESTATE
Rockland activists can recite a litany of land deals involving local officials who allegedly used their public positions to enrich themselves personally. Each, time, one or two officials faced criminal charges, but the larger problem goes unaddressed, they say.
Among the deal they cite:
• Last year, Nathan Rothschild, a former East Ramapo School Board president and a Monsey fire commissioner, was sentenced to a year in prison for cutting a deal with investors who bought a piece of land later purchased by the Fire Department -- at a higher price -- at Rothschild's behest.
• In 2001, the former chairman of the Rockland County Democratic Party, Paul W. Adler, pleaded guilty to of colluding with developers Yosef and Israel Herskowitz and Haverstraw town attorney Sean Purdy to bribe a Planning Board member with political patronage positions in exchange for a vote on a development project
• In 2003, Stony Point Supervisor Steven Hurley faced federal charges that he solicited an $8,500 kickback from a contractor who wanted to do some work on a local golf course
"The reality of it is that the politics of Spring Valley has been dysfunctional for years. This is not new information," said Cassandra Edwards, a Spring Valley activist.
According to Bob Rhodes, 71, the operator of the Deerkill Day Camp, bribery related to real estate has a long history in Rockland.
"Corruption around building in Ramapo goes back at least 50 years," Rhodes said. "Zoning laws are being used to enrich builders and the intermediaries between the lawyers and the builders."
Rockland County District Attorney Thomas Zugibe said he is not aware of additional investigations focused in Rockland.
"I believe that most of our elected officials are very dedicated, hardworking and honest elected officials," Zugibe said. "I think that this gives everyone a black eye. It puts everyone under the spotlight, which is unfortunate. Most of them do it for the right reason, for the good of the public, and not for their own personal benefit. It's unfortunate that everybody gets blackened by a few."
THE CHEMISTRY OF GREED
But Zugibe has seen firsthand what happens when greed comes into play.
"I think it's all a matter of power," Zugibe said. "Public officials wield a lot of power. You're depending on them acting honestly. If somebody doesn't act honestly, they could do a lot of damage."
The case against Spring Valley Mayor Noramie Jasmin and Deputy Mayor Joseph Desmaret could serve as a template for crooked deals. The two are accused of trading their votes and using their influence over fellow board members in Spring Valley to win approval for a wealthy developer's plan to build a community center on village land.
What Jasmin and Desmaret didn't know was that the developer was working for the FBI, hoping to reduce the time he will spend in prison, having been caught up in a mortgage fraud scam some years before. When he arrived at the October 2012 meeting where village trustees voted 4-1 in favor of the community center project, he was accompanied by undercover FBI agents posing as his associates.
"Real estate is the focus of a lot of fraud because there's a lot of money tied up in real estate and it's easy to take a lot of money out of real estate by financing it," Zugibe said.
Where a huge profit is at stake, unscrupulous developers are happy to form secret partnerships with public officials. According to federal prosecutors, Jasmin hid her financial stake in 2Holdings LLC, the company supposedly focused on the new community center -- but in reality staffed by the FBI.
Activists in Rockland County argue that an atmosphere of corruption permeates many zoning and planning boards, allowing developers to enrich themselves -- and their political allies -- by purchasing land zoned for a single-family homes, then quickly increasing the value by winning approval for multifamily zoning from local boards stacked with allies.
ACTIVISTS RALLY TO CURB CHRONYISM
Rockland residents from all walks of life have been driven to activism by the perception that the political life of the area has been corrupted by real estate developers.
"I grew up here. My father grew up here. I've never been directly involved in politics, but a few years back I got sort of drawn in," said Castellucio, a former teacher who is now one of the leaders of Preserve Ramapo, an activist group founded 12 years ago.
Members of the group, which presents itself as the "not-so-silent majority," maintain a website where they publish documents relating to public policy, arguing that the leadership of the town has been captured by ethnic groups intent on pillaging community resources for their own ends.
In the Town of Clarkstown, hundreds have banded together to form Clarkstown Taxpayers, group started four years ago to protest the outlandishly high salaries for public employees.
"We have gone way beyond the tax issue and started scrutinizing all government costs and problems," said Frank Grandel, a 60-year-old carpet installer who lives in New City.
In Clarkstown, activists allege that public jobs are being traded for political favors. They point to a number of positions held by partisan political leaders. For example, several Clarkstown activists opposed the appointment of Joseph "Jay" Savino, the Bronx GOP chairman, as a legal consultant for the Town of Clarkstown.
Savino was arrested along with Jasmin and Desmaret last week, charged with accepting bribes to help a Democratic state senator's run for mayor in New York City.
The activists have not been hesitant to attack the ethics of the Hasidic communities that wield political power in Rockland, and have been called anti-Semitic, a charge they reject.
"We are citizens interested in our government and we have a right to ask our government questions in public," said Michael Hull, a retired scientist who lives in Bardonia. Hull has challenged Clarkstown leaders aggressively. "When the government has to disparage us in that way, that means there is something to hide."
In Spring Valley, the accusations of improprieties relating to land deals extend to Orthodox Jewish members of the school board. There, activist Bob Forrest worked to scuttle a plan to sell the Hillcrest Elementary school at a bargain price to Yeshiva Avir Yakov, an Orthodox Jewish congregation based in New Square.
Forrest works in telecommunciations, but also performs real estate appraisals. Ultimately, the state education department agreed that the price set for the school looked like a giveaway. The sale remains the focus of an investigation by state Attorney General Eric Schneiderman.
"It's crazy," Forrest said. "The corruption that has been uncovered in the village of Spring Valley is only the tip of the iceberg for the bigger picture of the corruption of Ramapo. It all has to do with the real estate."