Former Oyster Bay Town Supervisor John Venditto was indicted Tuesday on 21 new federal criminal charges involving securities fraud in the town’s public offering of more than $1 billion in securities between 2010 and 2016.
The superseding indictment adds 21 more counts to the alleged corruption and kickback case which Eastern District federal prosecutors have already brought against Venditto, Nassau County Executive Edward Mangano and Mangano’s wife, Linda. The Manganos are not accused in the securities fraud.
The thrust of the new charges accuse Venditto and unnamed others of being instrumental in the creation of the securities fraud and then failing to disclose in the town’s public offerings what federal prosecutors said is the crux of the fraud: having the town conceal millions in indirect loan guarantees to an unidentified Co-conspirator. Sources have said the Co-Conspirator is former restaurateur Harendra Singh.
In a parallel action, the Securities and Exchange Commission also filed a separate civil suit, accusing Venditto and the town of securities fraud.
“I don’t see anything new in the superseding indictment,” Marc Agnifilo, Venditto’s attorney, said Tuesday. “It and the SEC complaint are just a recycling of what is in the original indictment to which my client already has pleaded not guilty to.”
The 21 new charges Venditto faces are: one count of securities fraud; one count of conspiracy to commit wire fraud related to securities offerings; and 19 counts of wire fraud related to securities offerings.
Venditto’s arraignment on the new indictment is tentatively scheduled for December 5th. The Manganos — who are not charged with securities fraud — are also required to appear and plead to the superseding indictment.
The new Venditto charges involve the town’s issuance of 30 different securities offerings — typically used by municipalities to get financing for their normal operations and emergencies, such as superstorm Sandy — without disclosing the indirect bond guarantee with Singh and its potential liabilities to Oyster Bay.
The securities included: Bond Anticipation Notes, Bond Anticipation Renewal Notes, Revenue Anticipation Notes, Tax Anticipation Notes, General Obligation Bonds, Public Improvement Bonds, Public Improvement Refunding Bonds, Deficiency Notes and Hurricane Sandy Budget Notes, the indictment said.
One example, federal prosecutors Catherine Mirabile, Lara Treinis Gatz, and Raymond Tierney said in the new indictment was the town’s offering on July 24, 2014 of $170 million of General Obligation Bonds; another was the July 2, 2014 issuing of $20 million in Tax Anticipation Notes.
The overall securities fraud and conspiracy counts includes all 30 security offerings the town made between 2010 and 2016. But some are not included in the individual wire fraud counts because the federal statute of limitations on such crimes goes back only five years, to December of 2012.
Each fraud count carries a maximum penalty of 20 years in prison, but if Venditto is convicted he most likely to get a lesser sentence.
Venditto “caused false and misleading statements and omissions to be made that presented investors, prospective investors, rating agencies, insurance companies, auditors, and municipal advisers with a false picture of the TOB’s financial condition and the quality and integrity of its management,” the superseding indictment reads.
Further, the prosecutors said when a December 2015 article in an unnamed newspaper appeared regarding the Singh loan guarantees, “Venditto denied knowledge of the guarantees, instead claiming, among other things, that they were ‘entered into without the involvement of necessary Town officials,’ when in fact, Venditto was fully aware of the loan guarantees and had intentionally hid them from the public and certain personnel within the TOB.” The article appeared in Newsday.
Venditto previously was charged with obstruction of justice, conspiracy to commit bribery, and making false statements to investigators in connection with his dealings with Singh concerning the loan guarantees.
While not accused of involvement with Singh in the securities fraud, the Manganos have been charged in their own allegedly illegal dealings with Singh.
For helping Singh get the indirect loan guarantees, federal prosecutors said, Venditto got the use from Singh of a private room at one of his former restaurants as an office, free chauffeur service for himself and his family, and a discounted fundraiser at a Singh restaurant.
For his part, the prosecutors said, Mangano allegedly got Singh to pay for vacation hotel and travel expenses, limousine services, and free meals and other gifts. Linda Mangano got a no-show job worth more than $400,000 the prosecutors said.
Both Venditto and the Manganos have previously pleaded not guilty to the charges on the original indictment.
Singh’s attorney, Anthony La Pinta, of Hauppauge, declined to comment as did Linda Mangano’s attorney, John Carman, of Garden City,.
Mangano’s attorney, Kevin Keating, of Garden City, did not immediately return calls forcomment.
New Added Charges: 21 counts of securities fraud, conspiracy to commit wire fraud, and wire fraud related to securities offering.
What’s alleged: Venditto was involved in a scheme to conceal from investors and potential investors indirect loan guarantees on over a $1 billion in securities issued by the Town of Oyster Bay between 2010 and 2016. The loan guarantees went to a former restaurateur who had food concessions on town property.
In the new indictment, federal prosecutors said: “Venditto caused false and misleading statements and omissions that presented investors . . . with a false picture of the TOB’s financial condition and the quality and integrity of its management.”