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Long IslandColumnistsJoye Brown

Oyster Bay on the sidelines

The Town of Oyster Bay increasingly is finding itself on the outside looking in, as prosecutors and defense attorneys ready for next week’s trial on federal corruption-related charges of former County Executive Edward Mangano, his spouse, Linda, and former town supervisor John Venditto.

Last month, Oyster Bay faced off against prosecutors and attorneys for all three defendants over a statement a former deputy town attorney gave officials during a town inquiry into loan guarantees involving a former town vendor, Harendra Singh.

The town fought against handing over the statement, and related emails, involving former deputy town attorney Fred Mei.

But Oyster Bay lost that one.

Meanwhile, proceedings in one federal and three state lawsuits have been delayed because of the upcoming criminal trial, which is slated to begin March 12.

With stays in place, Oyster Bay can neither press its position in a state civil suit it filed against Mei, Singh and others — or defend itself in three other civil actions filed against the town by lenders.

The town also finds itself fighting a U.S. Securities and Exchange Commission civil complaint that charged Oyster Bay, and Venditto, with defrauding municipal bond investors by concealing more than $20 million in loans the town guaranteed indirectly for Singh. The town has yet to resolve the SEC charges lodged against it in November.

Another official, former town attorney Leonard Genova, was charged last week — and agreed to settle — SEC allegations. The civil complaint alleged that Genova and others “engaged in a scheme to defraud investors” by assisting an unnamed concessionaire in obtaining loan guarantees and not disclosing them to town taxpayers or municipal bond investors.

Between 2010 and 2012, Singh got four loans — two of which Oyster Bay says are invalid because they were secured by Mei and others without knowledge of town officials.

Prosecutors contend that the town, under Venditto and with the help of Mangano, worked to indirectly guarantee the loans; the SEC contends that Singh secured not just two — but all four — with the help of town officials.

In the criminal case, prosecutors contend that the loans were among the fruits of alleged bribes by Singh.

But to Oyster Bay, legitimacy of the loans means everything. The town has sued Mei and others, contending they helped Singh secure two of the loans without the town’s knowledge. Oyster Bay also is being sued by lenders who contend the town is responsible for Singh’s defaulted loans.

Mangano has been charged with conspiracy, bribery, wire fraud and extortion. Linda Mangano has been charged with making false statements, conspiracy and obstruction of justice. And in addition to the SEC allegations, Venditto has been charged with conspiracy, bribery, securities fraud, wire fraud, making false statements and obstruction of justice.

All have pleaded not guilty.

On Monday, Joseph Nocella, the Oyster Bay Town attorney, said, “The town doesn’t comment on ongoing litigation, especially as it involves a previous administration.”

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