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Re: LLs/Managers Indicted -- Newsday story

Posted by Mark Smith on June 23, 1999 at 13:40:51:

In Reply to: LLs/Managers Indicted in Bid-Rigging on 74 Buildings posted by Anna on June 23, 1999 at 12:19:41:

From the June 23rd edition of Newsday (that one huge paragraph is the way the story appears on Newsday's website):

'Cycle Of Greed' / 30 Indicted in real-estate scheme

By Pete Bowles and Graham Rayman. STAFF WRITER;

Staff writer Theola S. Labbe contributed to this story.

In breaking up what was described as a "cycle of greed" that affected thousands of cooperative and condominium residents, authorities yesterday arrested 30 people in the real estate industry on charges they stole almost $4 million in kickback and bid-rigging schemes. The 30 defendants and 10 corporations they were associated with were accused in 10 indictments with defrauding 74 co-op and condo apartment buildings, including a number in Queens. Those charged included management agents, board members, building superintendents, vendors and contractors. In addition, two of the city's largest co-op management companies - Marvin Gold Management Co. of Brooklyn and Elm Management Associates of Lake Success - were charged with running racketeering enterprises that defrauded buildings they managed of about $3 million. "This will go a long way toward ending the cycle of greed that has existed for far too long in the residential real estate industry," Edward Kuriansky, commissioner of the city's Department of Investigation, said of the charges. He said "so much money was being siphoned off" that mortgages on Mitchell-Lama housing projects were not being paid and "necessary repairs and maintenance were deferred or not completed." Manhattan District Attorney Robert Morgenthau said corrupt building managers and board members took kickbacks from vendors - usually amounting to 10 percent of the contracted price. "In addition, some vendors willingly joined the scheme, since the kickback arrangement protected them from competition, allowing them to rig bids and charge whatever prices they pleased," he said. Among those charged were Marvin Gold, 67, president of Marvin Gold Management, who was accused of co

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