Corruption, changing names and a little bit of REBNY golf

Since assuming office in 2010, Manhattan District Attorney Cyrus R. Vance, Jr. has made the investigation of corruption in the interior construction industry a priority. His investigations will help to better protect Real Estate Board of New York members while also saving millions of dollars for building owners and corporate tenants.

Since January 2010, the District Attorney’s investigations in the interior construction industry have achieved 24 felony charges, with 22 corporations and 18 individuals charged; 23 felony convictions including 14 corporations and nine individuals; and 10 misdemeanor convictions including five corporations and five individuals. Approximately $7.5 million has been recovered in restitution; approximately $1 million in fines and forfeitures; and approximately $750,000 in taxes, interest and penalties.

Earlier this month, a man was sentenced to 4 1/2 to 9 years in prison after being convicted of extorting payoffs from builders by posing as an inspector and threatening to report phony violations. The man and his partner worked their criminal activity through a phony organization called the “Committee on Contract Compliance” and many of their victims were primarily from Asia or the Middle East. In 2011, his partner was sentenced to 7 to 21 years in prison after his conviction for participating in this scheme.

For this case, many of the violations reported by the men to regulatory agencies were not legitimate, and the unnecessary site inspections both interrupted and delayed construction projects, costing contractors considerable money and time. After the agencies left the construction sites, the defendants would again demand payments, which many of the contractors then paid.

The Manhattan DA’s office said they are looking at the entire interior construction industry and investigating different types of fraud being committed by contractors.

Corruption in construction work drives up the already high costs of doing business in New York City. Each year, billions of dollars are spent on building and rebuilding walls and interiors like plumbing, electrical and mechanical work inside the city’s corporate structures.

The work by District Attorney Vance and his staff is encouraging and send a message that interior work corruption will not be tolerated in our city.

I commend the MDA Vance, Jr. and his staff for their diligence on this case and the other convictions as well as their ongoing investigations on interior work corruption in NYC.

REBNY Renames Commercial Loft Committee

Recently as the large and diverse Midtown South market has become more sought after by tenants and investors, REBNY realized that to better serve our members, our coverage of the market should be promoted. The Loft and Secondary Committee have been covering this area very well for years but many members did not realize the breadth of the coverage because of the name.

It was decided to change the name to the Midtown South Committee, which will cover essentially all of Manhattan from Canal Street to 42nd Street including these neighborhoods: Chelsea; East Village; the Fashion District; Flatiron; Gramercy; Hudson Square; Lower East Side; the Meatpacking District; Murray Hill; Noho; Nolita; Soho; Union Square; and West Village.

This committee may have some geographic overlap with the Midtown West/Penn Plaza and Grand Central Committees, but that can only be beneficial as the more information shared the better. Members are allowed and encouraged to participate in more than one committee, which provides a forum where its members can exchange information and build relationships.

The Commercial Division has many other committees including Appraisal; Building Agents; Finance; Grand Central; Leasing Brokers; Loft and Secondary; Lower Manhattan; Plaza District; Retail; Sales Brokers; and West Side/ Penn Plaza. Last year, REBNY expanded the West Side Committee to include the important Penn Plaza submarket.

The Commercial Board of Directors encourages all of our commercial members to take advantage of all of the commercial committees and get involved. For more information, visit

In other REBNY News:

Attention all golfers and tennis players. After being canceled due to inclement weather, REBNY’s Spring Golf & Tennis Outing has been rescheduled for Thursday, June 28.  It will be held at the North Shore Country Club, a beautiful newly-renovated golf course, tennis courts and clubhouse spearheaded by one of REBNY’s esteemed members Donald Zucker. The event includes a full day of golf or tennis with breakfast, lunch, cocktails and dinner at the North Shore Country Club located in Glen Head, Long Island. Golfers pay $425 and tennis players pay $315. For more information, contact Kathleen Gibbs at or 212-616-5246.