The longtime head of the nation's largest municipal jail guard union was paid tens of thousands of dollars in cash, delivered in a luxury handbag, in exchange for steering $20 million in union money to a hedge fund in 2014, according to a criminal complaint. 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 morning, officials said. The arrests are the latest development in a series of overlapping public corruption investigations coordinated by US Attorney Preet Bharara, with other targets including high-ranking New York Police Department officials and political fundraising activities of several people with ties to New York City's mayor, the AP reports.
Huberfeld is accused of participating in a scheme to hand out hundreds of thousands of dollars in kickbacks to Seabrook in exchange for investments in his fund, Platinum Partners, LP, according to the complaint. It says the scheme was facilitated by someone who has pleaded guilty and is cooperating with federal investigators. The court papers don't name the cooperator. But two people with direct knowledge of the case identified that person as Jona Rechnitz, a businessman who has contributed to Mayor Bill de Blasio's campaigns, was friendly with top city police officials and has been captured on FBI wiretaps in a related gifts-for-favors probe. Though he was promised more for his investments, Seabrook was ultimately paid $60,000 in cash handed to him by Rechnitz in an $820 Salvatore Ferragamo luxury handbag in December 2014, according to the complaint. To disguise the kickback, Huberfeld created a fake invoice for Rechnitz's eight season tickets to the Knicks, paid for from Platinum funds that were funneled to Seabrook. (Read more New York stories.)