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Norman Seabrook, Correction Officers’ Benevolent Association, NYC Correctional Officers Union

Norman Seabrook, NYC correction officers’ union head, arrested on federal corruption charges. The president of the Correction Officers’ Benevolent Association — who was arrested at his Bronx home — allegedly received $60,000 in kickbacks delivered in an $820 Ferragamo bag from his favorite luxury goods store in the city, according to a federal complaint.

READ THE Norman Seabrook Indictment Here

Department of Justice
U.S. Attorney’s Office
Southern District of New York

FOR IMMEDIATE RELEASE
Wednesday, June 8, 2016

Norman Seabrook, President Of Correction Officers’ Benevolent Association, Arrested For Demanding And Accepting Bribes In Exchange For Investing Union Money In New York-Based Hedge Fund

Murray Huberfeld, Founder of Manhattan-based Hedge Fund, Also Charged For Paying Off Seabrook to Invest in the Fund

Preet Bharara, the United States Attorney for the Southern District of New York, and Diego Rodriguez, Assistant Director-in-Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced today that NORMAN SEABROOK and MURRAY HUBERFELD were arrested this morning and charged in Manhattan federal court with committing honest services wire fraud, in connection with HUBERFELD’s payment of a $60,000 bribe to SEABROOK, the President of the Correction Officers’ Benevolent Association (“COBA”), and the promise of future bribe payments, in exchange for SEABROOK’s investment of $20 million of COBA money in HUBERFELD’s hedge fund.  SEABROOK was arrested this morning by FBI agents in the Bronx, and HUBERFELD was arrested this morning by FBI agents in Manhattan.  They will be presented before U.S. Magistrate Judge Kevin N. Fox in Manhattan this afternoon.

Manhattan U.S. Attorney Preet Bharara said:  “As alleged, Norman Seabrook and Murray Huberfeld engaged in a straightforward and explicit bribery scheme.  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.”

FBI Assistant Director-in-Charge Diego Rodriquez said:  “When an official takes advantage of his or her position as steward of an organization’s financial resources in order to line their own pockets, it is a dereliction of duty for someone trusted to protect the financial contributions of the hard working men and women who belong to the organization.  When a hedge fund manager provides bribe payments to organizations to gain their business, he or she puts the financial security of the fund’s investors at risk.  This kind of criminal collusion destabilizes the system and undermines investors’ confidence in the integrity of the marketplace.  The FBI, along with our partners, will continue to work to protect our citizens from the destructive consequences of corruption and deceit.”

According to the allegations in the Complaint filed yesterday in Manhattan federal court[1]:

COBA is New York City’s largest correction officers union and the largest municipal jail union in the United States.  COBA represents over 9,000 correction officers in New York City, including at Riker’s Island.  NORMAN SEABROOK, the defendant, is the President of COBA and has been for over 20 years.  SEABROOK’s power over the affairs of COBA is rarely questioned by his Executive Board due to his ability to affect their assignments, pay, and hours.  SEABROOK’s control extends to the union’s finances, including the administration of its “Annuity Fund,” a retirement benefits program funded by the City of New York that invests more than $70 million for correction officers’ retirements.

Toward the end of 2013, on a trip to the Dominican Republic with, among others, an individual who is now a cooperating witness for the Government (“CW-1”), SEABROOK told CW-1 that he worked hard to invest COBA’s money and was not getting anything out of it, and it was time that “Norman Seabrook got paid.”  CW-1 was friendly with and had done business with MURRAY HUBERFELD, a founder and part owner of Platinum Partners (“Platinum”), a Manhattan-based hedge fund that principally ran two funds.  CW-1 was aware that Platinum was looking to attract public and institutional investors – as opposed to its more typical investor set of high net-worth individuals – and told HUBERFELD that SEABROOK would likely invest COBA money in Platinum if HUBERFELD were willing to pay SEABROOK money.  HUBERFELD agreed to the proposition, and HUBERFELD worked out a formula in which SEABROOK would be paid a kickback of a portion of the profits from COBA’s investment that HUBERFELD estimated could be between $100,000 and $150,000 per year.

SEABROOK then began investing COBA’s money, at first going through the motions of having Platinum make a pitch to COBA’s Annuity Fund board and having advisers conduct diligence.  Those advisers included attorneys who expressed concern that public pensions like COBA do not typically invest in higher-risk vehicles like hedge funds.  In March 2014, COBA’s Annuity Fund made a $10 million investment in one of Platinum’s funds.  In June 2014 – this time without running the investment by the COBA Board or seeking any approval – SEABROOK invested $5 million, or 40 percent, of COBA’s own assets in the same fund.  In August 2014, the Annuity Fund invested another $5 million in Platinum.  By that point, COBA was the largest investor in that Platinum fund for all of 2014, and amounted to more than half of all incoming investments for the fund.  At the same time, the fund was experiencing significant redemptions by other investors.

Toward the end of 2014, SEABROOK wanted the first of his kickback payments, and demanded it from CW-1.  HUBERFELD told CW-1 that the fund had not performed as well as expected, and that he could pay SEABROOK only $60,000.  CW-1 agreed to lay out the cash, and HUBERFELD agreed to reimburse CW-1 on Platinum’s behalf.  HUBERFELD suggested that to paper over the reimbursement, CW-1 invoice Platinum for a number of CW-1’s tickets to the Knicks, in the amount of $60,000, and Platinum would then cut a check to CW-1.

CW-1 paid SEABROOK the first $60,000 kickback on December 11, 2014.  Before meeting SEABROOK that evening, CW-1 went to one of SEABROOK’s favorite stores, Salvatore Ferragamo on Fifth Avenue in Manhattan, and bought an expensive bag for SEABROOK.  CW-1 put the money in the bag, and met SEABROOK a few blocks away in SEABROOK’s COBA vehicle, where he handed SEABROOK the bag.  CW-1 and SEABROOK had dinner with two other persons, then attended a Torah dedication ceremony, after which SEABROOK left Manhattan.  These events have been corroborated by, among other things, phone records, e-mails, license plate reader records, and a receipt from Salvatore Ferragamo.  On the same day, CW-1’s assistant prepared a $60,000 invoice to Platinum for Knicks tickets, which CW-1 forwarded by e-mail to HUBERFELD.  Three days later, Platinum paid CW-1 by check.

HUBERFELD, through another co-conspirator not identified in the Complaint, continued to lobby SEABROOK for more money in 2015.  However, after a lawsuit filed by a former COBA board member referred to the Platinum investments, and the U.S. Attorney’s Office grand jury investigation resulted in subpoenas to Platinum and COBA in May 2015, no further investments were made.

*                *                *

SEABROOK, 56, of the Bronx, New York, and HUBERFELD, 55, of Manhattan New York, have been charged with one count of conspiracy to commit honest services wire fraud, and one count of honest services wire fraud.  Each of the two counts carries a maximum term of 20 years in prison.  The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by the judge.

Mr. Bharara praised the investigative work of the FBI, the NYPD Internal Affairs Bureau, and the Internal Revenue Service’s Criminal Investigations Division, and noted that the investigation is continuing.

This case is being handled by the Office’s Public Corruption Unit.  Assistant United States Attorneys Martin Bell, Russell Capone, and Kan M. Nawaday are in charge of the prosecution.

The charges contained in the Complaint are merely accusations and the defendants are presumed innocent unless and until proven guilty.


[1] As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint set forth herein constitute only allegations, and every fact described should be treated as an allegation.

16-154
Topic:
Public Corruption

Norman Seabrook arrested on federal corruption charges

New York Daily News – ‎1 hour ago‎
Norman Seabrook, the powerful and politically connected head of the city’s Correction Officers’ Benevolent Association, was arrested early Wednesday on federal corruption charges — including taking a $60,000 payoff delivered in a designer bag

Head of Correction Officers’ Union Took Cash Bribes in Ferragamo Bag, Feds Say

New York Magazine – ‎42 minutes ago‎
And so it begins: Norman Seabrook, the influential head of the New York City corrections’ officers union was arrested Wednesday morning on federal fraud charges, reports the New York Times. Seabrook’s arrest is tied to the expansive FBI corruption …

Indicted CO Union head Norman Seabrook always fought corruption

New York Daily News – ‎1 hour ago‎
He rose from a poor family in the Bronx to head of one of the city’s most powerful law enforcement unions. Now, Norman Seabrook may find himself behind bars. The bombastic union president joined the department in 1985 and was soon assigned to drive …

Federal Agents Arrest New York City Correction Union President Norman Seabrook

Wall Street Journal – ‎6 hours ago‎
Norman Seabrook, president of New York City’s correction officers’ union, was arrested at his home Wednesday morning as part of a continuing federal municipal corruption probe, according to a criminal complaint and a person familiar with the matter.

Correction officers union president Norman Seabrook arrested

Fox5NY – ‎8 hours ago‎
NEW YORK (FOX 5 NY) – The Federal Bureau of Investigation arrested longtime Correction Officers’ Benevolent Association president Norman Seabrook at his home in the Bronx Wednesday morning. Investigators have been looking into the financial records …

Norman Seabrook, Murray Huberfeld arrested in connection with federal corruption charges

WABC-TV – ‎8 hours ago‎
Norman Seabrook and hedge fund financier Murray Huberfeld were arrested Wednesday morning in connection with a federal investigation. The two are charged with one count of honest services wire fraud and one count of conspiracy to commit honest …

FBI Arrests Correction Union President Norman Seabrook For Wire Fraud

Gothamist – ‎5 hours ago‎
U.S. Attorney Preet Bharara’s corruption investigation into NYC officials has now landed another big fish: Correction union president Norman Seabrook was arrested this morning, on wire fraud charges. Seabrook is accused of receiving kickbacks in

NYC correction officers’ union head arrested in corruption probe

New York Post – ‎6 hours ago‎
Correction officers’ union chief Norman Seabrook was busted by the feds Wednesday on corruption charges in connection with a sweeping corruption probe that is also focused on the NYPD and City Hall, law enforcement sources said. The president of the …

NYC Correction Officers’ Union Leader Arrested On Fraud Charges

CBS Local – ‎3 hours ago‎
NEW YORK (CBSNewYork/AP) — The leader of the union that represents New York City corrections officers has been arrested on federal fraud charges. Correction Officers’ Benevolent Association leader Norman Seabrook was arrested without incident at his …

NYC corrections union head arrested in corruption probe

CBS News – ‎4 hours ago‎
Correction Officers’ Benevolent Association leader Norman Seabrook was arrested without incident at his home in the Bronx, police said. Law enforcement officials were on the scene Wednesday morning surrounding his home. Murray Huberfeld, hedge fund …

Orthodox Donor Murray Huberfeld Arrested in Norman Seabrook Kickback Scheme

Forward – ‎4 hours ago‎
Murray Huberfeld, a financier with a long history of run-ins with regulators, is charged with honest services wire fraud, according to press reports. Norman Seabrook, the powerful president of the union representing New York City corrections officers

Correction Boss Busted in Alleged Pension Scam

NBC New York – ‎7 hours ago‎
… cash in exchange for the investment of pension funds was arrested by the FBI on corruption charges in an ongoing investigation focusing on the NYPD and City Hall. Norman Seabrook, president of the Correction Officers’ Benevolent Association for the

Fraud Charges for a New York City Union Boss

The Atlantic – ‎1 hour ago‎
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,” …

Chief of New York Jail Officers’ Union Is Arrested on Fraud Charges

New York Times – ‎8 hours ago‎
The charges against the union leader, Norman Seabrook, and a second defendant, Murray Huberfeld, a hedge-fund financier, represent the first major criminal case linked to one of several corruption investigations that are focused on the campaign …

Officials: Corrections Officers’ union president Norman Seabrook arrested by feds at Bronx home

News 12 Brooklyn – ‎4 hours ago‎
Officials with the Bronx District Attorney’s Office have confirmed Corrections Officers’ union presidentNorman Seabrook was arrested by federal agents at his Bronx home Wednesday. (9:34 AM). MORRIS PARK – Norman Seabrook, the head of the corrections …

New York correction officers’ union leader Norman Seabrook arrested for federal law charges

Daily Mail – ‎1 hour ago‎
The powerful chief of the New York City correction officers’ union has been arrested for allegedly accepting kickbacks in exchange for funneling a total $20million out of union funds. FBI agents arrested Norman Seabrook, president of the Correction

FBI arrests president of New York City correction union on corruption allegations

New York’s PIX11 / WPIX-TV – ‎7 hours ago‎
The FBI in New York says Norman Seabrook and Murray Huberfeld of Platinum Partners, L.P. were arrested early Wednesday. A 17-page indictment says that in return for kickbacks, Seabrook agreed to “direct transfers of millions of dollars” in union

NYC correction union chief arrested, according to feds

Newsday – ‎5 hours ago‎
Longtime head of the New York City correction officers union Norman Seabrook was arrested Wednesday by federal authorities and charged with taking kickbacks in a case potentially linked to investigations of Mayor Bill de Blasio. Seabrook, according to

Hedge Fund Manager Arrested For Paying Kickbacks To New York Union Chief

Forbes – ‎3 hours ago‎
Federal prosecutors claim that Norman Seabrook, the head of the union that represents New York City correctional officers, invested $20 million of the union’s pension money in Platinum Partners via Huberfeld, who agreed to pay kickbacks to Seabrook.

The Latest: Judge Says Arrested Union Boss Can Be Released

ABC News – ‎1 hour ago‎
A judge says the arrested leader for New York City’s jail guards union should be released without bail in his bribery case. Prosecutors had demanded union boss Norman Seabrook post a $500,000 bond. The judge says they can appeal his decision but have …

Head of New York City corrections officers union charged with fraud

Reuters – ‎48 minutes ago‎
The Federal Bureau of Investigation arrested Norman Seabrook, the politically influential president of the Correction Officers’ Benevolent Association, and Murray Huberfeld early on Wednesday. According to a criminal complaint, Seabrook invested $20 …

NYC correction union president, hedge founder face fraud charges

Syracuse.com – ‎3 hours ago‎
Norman Seabrook, the brash and defiant president of the 9,000-member New York City Correction Officers’ Benevolent Association, and hedge fund founder Murray Huberfeld, were arrested by FBI agents on conspiracy and fraud charges Wednesday …

Arrested Jail Guard Union Boss Allegedly Received $60000 Kickback in Ferragamo Bag

Gawker – ‎1 hour ago‎
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

Head of New York Jail Officers’ Union Arrested on Federal Corruption Charges

Gawker – ‎7 hours ago‎
Early on Wednesday morning, Norman Seabrook, the president of the Correction Officers’ Benevolent Association, was arrested at his Bronx home on federal corruption charges. According to the New York Daily News, Seabrook, who has blocked reforms at …

Correction Union Head Arrested on Fraud Charges in Federal Corruption Probe

DNAinfo – ‎6 hours ago‎
Norman Seabrook, president of the Correction Officers’ Benevolent Association, personally got tens of thousands of dollars in kickbacks for steering about $20 million in union money to the Platinum Partners hedge fund in a scheme dating back to

Mayor calls alleged actions of corrections officer’s union head ‘disgusting’

News 12 Brooklyn – ‎1 hour ago‎
MORRIS PARK – Mayor Bill de Blasio says if the allegations against Norman Seabrook are true, then it’s disgusting he stole from his own workers’ retirement funds and that he wishes he never met him. United States Attorney for the Southern District of

A controversial hedge fund manager has been charged with fraud

Business Insider – ‎5 hours ago‎
Norman Seabrook, the longtime president of the Correction Officers’ Benevolent Association, and businessman Murray Huberfeld were charged with fraud and conspiracy, according to a criminal complaint unsealed on Wednesday. The charges stem from an …

President of New York correction officers’ union arrested on fraud charges

The Independent – ‎1 hour ago‎
Norman Seabrook, who has served as the president of the 9,000 member Correction Officers’ Benevolent Association, is accused of taking $60,000 (£41,271) in kickbacks from Murray Huberfeld – also charged in the case – in exchange for directing $20m …

Feds Make First Arrests Stemming from Bill De Blasio Fundraising Probe

Washington Free Beacon – ‎27 minutes ago‎
Federal authorities made their first arrests in connection with the several corruption investigations into the fundraising operation of New York City Mayor Bill de Blasio, according to the New York Times. Norman Seabrook, the politically connected

De Blasio Calls Allegations Against Correction Union Head ‘Disgusting’

Observer – ‎2 hours ago‎
After a growing gifts-for-favors investigation today led to the arrest of Norman Seabrook, Mayor Bill de Blasio called the allegations against the controversial correction union leader “disgusting”—and sought to distance himself from the campaign
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