On March 23, 2010, the Oyster Bay Town Board unanimously passed an unusual resolution — one that later would become key to federal allegations of corruption against former Supervisor John Venditto.
Noting “the global credit crisis,” the measure said it had become “very difficult to secure financing for certain projects.”
But the resolution didn’t go on, as might have been expected, to cite what impact a credit crisis could have on the town.
Instead, the resolution veered in a different direction, detailing a bank’s requirement that Oyster Bay “enter into an agreement related to . . . [a] loan” not for the town — but for one of its contractors.
Although it doesn’t name the contractor, the resolution does name two businesses owned by restaurateur Harendra Singh, who had a contract to provide food and beverages at a town beach and golf course.
The resolution goes on to cite memoranda by a town attorney, which recommended that “the Supervisor be authorized and directed to enter into an agreement with the concessionaire’s bank relating to the loan .”
Ultimately, prosecutors allege, Oyster Bay would end up helping Singh borrow — in 2010, 2011 and 2012 — more than $20 million. Those loan guarantees for Singh now are at the center of federal bribery charges against Venditto and County Executive Edward Mangano. Town officials have disputed the guarantees’ legitimacy, and Venditto and Mangano have pleaded not guilty to the criminal charges.
On Tuesday, prosecutors filed a superseding indictment with additional charges against Venditto, alleging fraud in public offerings of more than $1 billion in securities between 2010 and 2016.
On the same day, the U.S. Securities and Exchange Commission, in a civil case, alleged that both Venditto and the Town of Oyster Bay had defrauded investors by failing to disclose the Singh loan guarantees in bond documents.
But let’s get back to that March 2010 resolution.
How did it pass the town board? Why was the town so willing to help out a single concessionaire when there likely were others facing a credit crunch? And why didn’t any town board member question why the municipality should — either directly or indirectly — place the burden on town taxpayers to pay off one vendor’s debts, should he default?
No one asked any of those questions.
Venditto and other town officials, until 2015, also didn’t tell residents about special treatment afforded to Singh. Even then, Venditto and other officials insisted that while the town helped Singh obtain two loans, two others had been secured in secret by a town employee gone rogue.
In the SEC lawsuit, and through the original and superseding indictment, federal officials weave another scenario.
Prosecutors allege that the March resolution, while unusual, was drafted to be deliberately vague to hide attempts by Venditto and Mangano to help Singh. Further, prosecutors allege, the employee responsible for helping with the final two loans never went rogue; instead, he acted with officials’ support and approval.
The federal criminal trial for Venditto, Mangano and Mangano’s spouse, Linda, who also was charged in the case, is slated to begin in January.