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New York City Housing Authority Employees Charged In Sweeping Bribery And Extortion Case

The U.S. Attorney for the Southern District of New York (SDNY) announced individual charges Tuesday in a sweeping case that involves kickbacks and bribes from the New York City Housing Authority (NYCHA), charging 70 current and former NYCHA employees with bribery and extortion.

The investigation involved more than a year of collaboration between the office of SDNY attorney Damian Williams, the U.S. Department of Housing and Urban Development (HUD) Office of the Inspector General (OIG), the New York City Department of Investigations (DOI), the U.S. Department of Labor OIG and others, Williams said. The earliest alleged conduct goes back to 2013 and continued until as recently as 2023, he added.

Officials called it the “largest number of federal bribery charges on a single day in DOJ history.” Sixty-six of the 70 charged individuals were arrested in New York, New Jersey, Connecticut and North Carolina on Tuesday morning, officials said.

All defendants in the case were NYCHA employees during the time of the alleged conduct. They are charged with “demand[ing] and receiv[ing] cash in exchange for NYCHA contracts by either requiring contractors to pay up front in order to be awarded the contracts or requiring payment after the contractor finished the work and needed a NYCHA employee to sign off on the completed job so the contractor could receive payment from NYCHA,” SDNY explained in an announcement of the charges.

The defendants allegedly demanded between 10% and 20% of the contract value, with amounts ranging from $500 to $2,000 depending on the size of the contract. Some defendants “demanded even higher amounts,” according to SDNY.

“Instead of acting in the interests of NYCHA residents, the City of New York, or taxpayers, the 70 defendants charged today allegedly used their jobs at NYCHA to line their own pockets,” Williams said in the announcement. “This action is the largest single-day bribery takedown in the history of the Justice Department. NYCHA residents deserve better.”

In a press conference held on Tuesday morning, Williams addressed the size and scope of the alleged corruption, detailing that the 70 defendants allegedly demanded more than $2 million in private money from contractors in exchange for giving out more than $13 million in work on major buildings throughout the city.

“And if the contractors didn’t pay up, the defendants wouldn’t give them the work,” Williams said. “That’s classic pay to play in this culture of corruption at NYCHA, and […] the corruption we’ve alleged infected every corner of the city.”

The charges detailed that superintendents extorting and accepting bribes from contractors “had become business as usual, occurring in almost 100 NYCHA buildings across all five boroughs, or nearly a third of all NYCHA buildings,” Williams said.

NYCHA is a recipient of roughly $1.5 billion in federal funds each year. About one in 17 New Yorkers are supported by the organization, according to HUD Inspector General Rae Oliver Davis.

“My office is initiating an audit of NYCHA’s efforts to identify, combat and prevent corruption and fraud,” Davis said during the Tuesday press conference. “We will make recommendations that will assist NYCHA in promoting an overall culture that is anti-fraud. The failure to identify the risk of fraud stands in the way of the ultimate success of these most important housing programs.”

In a statement provided to HousingWire, Davis added that the schemes alleged today not only waste millions of dollars of public money but put residents at risk of unacceptable living conditions.

“The alleged conduct identified during this investigation harms the effectiveness of housing programs that support more than 200,000 residents,” Davis said. “It also poses a significant risk to the integrity of the HUD rental assistance programs that support housing assistance in New York City and erodes the trust of NYCHA residents in HUD’s programs.

“We will continue our work with the U.S. Attorney’s office and our law enforcement partners to prevent and detect these and other schemes.”

NYCHA is the largest public housing authority in the U.S. By 2018, NYCHA had approximately 13,000 employees serving an estimated 173,946 families, or nearly 400,000 authorized residents.

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