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Mount Vernon Mayor Ernie Davis admits he amended documents after learning of federal investigation

City of Mount Vernon Mayor Ernie Davis in

City of Mount Vernon Mayor Ernie Davis in his office at City Hall. (Dec. 13, 2012) Photo Credit: Xavier Mascarenas

Mount Vernon Mayor Ernie Davis admitted Friday that he amended his financial disclosure forms in December after he realized that federal authorities were investigating his finances.

Davis told Newsday that he "rushed through" the documents when he initially filed them last May and omitted one of the 10 properties he owns and from which he derives income.

"I went back and looked at the forms after all this stuff started," the mayor said, referring to the investigation. "I realized I didn't have anything there from the Sylvan Terrace house."

Elected officials must file these documents every year they are in office, revealing all financial interests including properties they own, their value and income derived from them. The value of the properties and the amount of rental income they generate were redacted from the amended forms obtained by Newsday from Mount Vernon City Hall.

Investigators are examining how the 74-year-old mayor, who earns about $200,000 a year from his salary and state pension, acquired more than $1 million worth of residential properties in four states and whether he properly reported rental income from the residences to the Internal Revenue Service, law enforcement sources said.

"I have done nothing wrong," insisted Davis, who served as mayor from 1995 to 2007 and reclaimed the post in 2011.

It is not known whether the mayor listed the properties in previous years. Newsday has requested Davis' financial disclosure forms for the other 12 years that he was in office, but Mount Vernon has not yet provided them.

Herbert Hadad, a spokesman for U.S. Attorney Preet Bharara declined to comment. Davis' attorney, Jeremy Temkin, a criminal tax specialist who is a partner in the Manhattan firm Morvillo-Abramowitz, the same firm that represented Martha Stewart in her insider trading case, could not be reached for comment.

Davis insists he has lost money on his real estate properties, saying the only residence that was "solvent" was the Sylvan Terrace town house in Manhattan, where apartments rent for about $2,700 a month. Davis bought the 12-unit building in 2001 for $180,000.

The mayor owns three residential properties in North Carolina, two in Manhattan, one in Mount Vernon, one in Yonkers, and one each in Florida and Virginia. He also owns an office building in Mount Vernon.

"They're trying to criminalize owning property, it seems. Why don't they investigate Donald Trump then? Am I not allowed to provide for my family," protested the married father of two grown daughters. "I bought those properties with my own money and hard work."

The U.S. attorney's office, the FBI and the IRS Criminal Division also have served subpoenas on City Hall workers in connection with three nonprofit funds Davis started.

Two of those workers -- Dulce Lima and Ruby Lohse -- who were employed as secretaries for Davis when he formed the Disaster Relief Fund in 2006, met Thursday with federal prosectors at the courthouse in White Plains, law enforcement sources said.

The nonprofit funds, however, are secondary to the probe into Davis' real estate holdings and income, the sources noted.

The 2012 disclosure form only lists the disaster relief fund and the Ernest Davis Endowment Fund. The documents did not include the Ernest Davis Scholarship Fund. Davis has said the funds are all above board and denies any wrongdoing.

The mayor lambasted the investigation and the media Thursday in print and during a radio interview with WVOX radio host William O'Shaughnessy. Coverage of the probe, he charged, has been a "lynching by press" and prosecutors are trying to "demonize" him.

"I consider them evil people," he said Thursday. He attacked Assistant U.S. Attorney Perry Carbone, the public corruption prosecutor who sources said is leading the probe into Davis.

"I would not want to meet him because what I would say would not be good and probably wouldn't help me," he told O'Shaughnessy.

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