Instead, Garnett recommended greater oversight by the city's Department of Housing Preservation and Development, which Garnett said had only two employees handling documentation for more than 100,000 Mitchell-Lama apartments citywide. Neither Gonzalez nor Investigation Commissioner Margaret Garnett called for city or state regulation of co-ops, which grant immense and often arbitrary power to their board members and management companies. "Affordable housing programs can only achieve their stated goals when they are administered in fair and honest ways and have meaningful oversight." "We actually believe this was the norm, not the exception," he said. But Gonzalez said it would be "naive" to think similar subterfuge was not happening at the other 268 Mitchell-Lama projects in the city. The DA and the Department of Investigation have linked 18 apartments to the plot thus far. If convicted, the women face up to 15 years in prison.Īll told, Gonzalez said, the women received $874,000 in bribes and helped people improperly obtain $5 million in properties-although, thanks to Mitchell-Lama tax abatements and mortgage assistance, the units sell for only tens of thousands of dollars, a fraction of their market value.
The prosecutor displayed designer bags, jewelry, furs and Florida condominium units he said the suspects purchased with their bribe money. "Corrupt insiders got cash bribes, applicants got the apartment they wanted without having to wait, and honest families got left out in the cold, never getting off the waiting list," Gonzalez said. That enabled the applicants to skip the thousands-deep waiting list through the process of succession, by which the Mitchell-Lama law-the statute governing Luna Park and similar developments-allows family members to share and transfer their stake in the co-op. The accused submitted fraudulent documents to the Department of Housing Preservation and Development, falsely showing that people were related to current shareholders and had lived with them for two years, the investigators said. A joint probe by his office and the Department of Investigation found what they described as a criminal scheme in which two board members and a management-company official helped people get below-market housing in exchange for payoffs.
Three women associated with the sprawling Luna Park cooperative complex in Coney Island have been charged with bribery, theft, forgery and conspiracy, Brooklyn District Attorney Eric Gonzalez announced Tuesday.
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