Norman Seabrook, the head of the influential Correction Officers’ Benevolent Association union, was arrested at his home this morning as part of the federal corruption investigation into the New York City government. According to U.S. Attorney Preet Bharara, Seabrook’s crimes included taking five-figure kickback payments inside designer handbags.
Seabrook is accused of investing $20 million of the union’s pension fund in a particular hedge fund and taking a cut of the investment’s profits for himself. Murray Huberfeld, who is employed by the hedge fund Platinum Partners, was also arrested.
In the words of Mayor Bill de Blasio, whose administration is also under investigation, and who took pains to distance himself from Seabrook when the news broke, the allegations essentially mean the union chief “stole money from his own workers” if they are true.
Seabrook and Huberfeld were charged with one count each of conspiracy to commit honest services wire fraud, and one count of honest services wire fraud, Bharara announced this afternoon. The federal prosecutor, who has a flair for the theatrical, included some juicy details about Seabrook’s apparent love for expensive clothing by Salvatore Ferragamo in the announcement:
For a Ferragamo bag stuffed with $60,000 in cash, Seabrook allegedly sold himself and his duty to safeguard the retirement funds of his fellow correction officers. Norman Seabrook, as COBA’s president for over two decades, allegedly made decisions about how to invest the nest egg for thousands of hard-working public servants, based not on what was good for them, but on what was good for Norman Seabrook.
.@PreetBharara knows what makes a good story. Says Seabrook had a thing for Ferragamo & agents found 10 pairs of Ferragamo shoes in his home— Joel Siegel (@joelmsiegel) June 8, 2016
Based in part on the work of someone who is identified in the criminal complaint only as a cooperating witness and co-conspirator, prosecutors also allege that Seabrook and Huberfeld agreed on further bribe payments to be paid to Seabrook in exchange for the union’s continued investment in Platinum Partners through Huberfeld.
The New York Times reported this morning that the cooperating witness is Jona S. Rechnitz, a real estate developer and de Blasio fundraiser whose name has repeatedly turned up during the corruption investigation. Rechnitz pled guilty to fraud conspiracy and is cooperating with the government “in the hopes of obtaining leniency when he is sentenced,” according to the complaint. De Blasio’s re-election campaign intends to keep the money bundled by Rechnitz, according to a Wall Street Journal reporter.