Manhattan U.S. Attorney Charges NYPD Officer with Bankruptcy Fraud

PREET BHARARA, the United States Attorney for the Southern District of New York, announced that KELVIN DANIELS, an officer with the New York City Police Department, surrendered today at United States District Court in White Plains in connection with a Complaint filed yesterday charging him with engaging in bankruptcy fraud.

As alleged in the Complaint filed in White Plains federal court:

In June 2005, DANIELS, 39, of Newburgh, New York, filed a voluntary petition in the United States Bankruptcy Court for the Southern District of New York (“Petition”). In the Petition, Daniels was required to provide a schedule listing all the properties he owned. DANIELS did not include on his schedule any property on Third Street in Newburgh. On July 21, 2005, DANIELS appeared at a hearing in connection with his Petition. DANIELS stated, under oath, that he had listed in his Petition all the properties he owned and that he had not owned any other properties within the last six years.

Upon questioning, however, DANIELS admitted at that hearing that, in or about July 2003, he had purchased property on Third Street in Newburgh, New York, jointly with another individual. DANIELS claimed that he had sold the property to that individual approximately two months after purchasing the property. DANIELS did acknowledge, however, that the property appeared on his 2004 tax return and that his name was still listed on the deed to the property at the time of the hearing. As set forth in the Complaint, upon the December 2006 sale of the property by the bankruptcy trustee, DANIELS’ bankruptcy estate received a portion of the proceeds of the sale.

The Complaint filed yesterday charges DANIELS with one count of bankruptcy fraud. The charge carries, upon conviction, a maximum sentence of five years’ imprisonment, and a maximum fine of $250,000 or twice the gross pecuniary loss or gain derived from the offense.

Following his presentment today before United States Magistrate Judge GEORGE A. YANTHIS, DANIELS was released pursuant to an unsecured bond in the amount of $50,000.

Mr. BHARARA praised the efforts of the Federal Bureau of Investigation and the Internal Affairs Bureau of the New York City Police Department.

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

Assistant United States Attorney MARCIA S. COHEN is in charge of the prosecution.