Federal Prosecutors Round Up 70 NYCHA Employees in Bribery Crackdown

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Dozens of current and former New York City Housing Authority employees allegedly took bribes in exchange for assigning no-bid construction contracts, according to federal charges unsealed Tuesday.

Prosecutors in the Southern District of New York unsealed charges Tuesday against 70 people accused of siphoning $2 million in a kickback scheme at NYCHA involving more than $13 million in construction work at public housing properties. Prosecutors said it was the largest-ever bribery crackdown in a single day.

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The defendants “used their jobs at NYCHA to line their own pockets,” U.S. Attorney Damian Williams said in a statement Tuesday morning.

“NYCHA residents deserve better,” Williams said. “The culture of corruption at NYCHA ends today.”

Police arrested dozens of people Tuesday morning in New York, New Jersey, Connecticut and North Carolina and hit them with numerous bribery and extortion charges. Sixty-six of the 70 defendants were due to appear before a federal judge in Manhattan Tuesday afternoon.

If convicted, they face between 10 and 20 years behind bars, according to federal sentencing guidelines. 

“NYCHA has zero tolerance for wrongful and illegal activity,” NYCHA CEO Lisa Bova-Hiatt said in a statement after the charges were unsealed. “The individuals allegedly involved in these acts put their greed first and violated the trust of our residents, their fellow NYCHA colleagues and all New Yorkers.”

Prosecutors say the defendants, who were all NYCHA employees when they carried out their alleged crimes between 2012 and 2023, accepted bribes of up to 20 percent of the value of no-bid contracts for repair jobs costing less than $10,000 at NYCHA developments in every city borough.

The scheme allowed the defendants to take home between $500 and $2,000 per contract, according to the indictments.

NYCHA has more than 300 public housing developments spread across the city and gets about $1.5 billion in federal funding annually. Its operating expenses totaled $4.41 billion last fiscal year.

However, the agency has faced a loss of federal funding over four decades that has left it underwater and is currently facing a federal lawsuit for failing to make required repairs in its properties. 

Abigail Nehring can be reached at anehring@commercialobserver.com.