U.S. Attorney's Office
Southern District of New York
(212) 637-2600
March 4, 2015

Former New York City Council Member Daniel Halloran Sentenced in White Plains Federal Court to 10 Years in Prison for Role in Bribery and Fraud Schemes

Preet Bharara, the United States Attorney for the Southern District of New York, announced that former New York City Council Member DANIEL HALLORAN was sentenced today in White Plains federal court to 10 years in prison in connection with his role in arranging the bribery of New York City Republican leaders to allow New York State Senator Malcolm Smith, a Democrat, to run as a Republican candidate for New York City Mayor in 2013, and accepting a $15,000 cash bribe in exchange for designating up to $80,000 in New York City funds to a non-profit entity that would allow the money to be embezzled through a no-show job. HALLORAN was sentenced by U.S. District Judge Kenneth M. Karas, who presided over the two-month trial that resulted in Halloran’s conviction in August 2014.

U.S. Attorney Preet Bharara said: “When elected officials, like Daniel Halloran, not only corrupt themselves but, unseen, corrupt the body politic from within they undermine the public’s confidence in a representative form of government. I would like to thank our law enforcement partners at the FBI and the Rockland County District Attorney’s Office for working with us to ensure that the defendant was pursued, prosecuted, and faced justice.”

According to the Complaint and the Indictment filed in federal court, the evidence admitted at trial, and statements made at various proceedings in this case, including today’s sentencing:

HALLORAN was elected to the New York City Council in 2009, representing a district in Queens, New York. While a member of the city council, HALLORAN participated in two overlapping criminal schemes that involved the payment of bribes to obtain official action. First, HALLORAN arranged for $110,000 in cash bribes to be paid to leaders of the Republican Party so that they would allow Smith to run for mayor on the Republican Party’s ballot line. Second, HALLORAN accepted an up-front kickback of $15,000 for designating up to $80,000 of New York City Council discretionary funding to a company he believed was controlled by those who paid him the bribes.

The Bribery of Republican Party Leaders

From November 2012 until his arrest in April 2013, HALLORAN agreed with Smith, an undercover FBI agent posing as a wealthy real estate developer (the “UC”), and a cooperating witness (“CW”) to bribe New York City Republican Party leaders in exchange for their authorization of Smith to appear as a Republican candidate for New York City Mayor in 2013, even though Smith is a registered Democrat.

In furtherance of the scheme, HALLORAN arranged for the UC and the CW to meet Vincent Tabone, the Vice Chairman of the Queens County Republican Party, Joseph Savino, the Chairman of the Bronx County Republican Party, and other party leaders. HALLORAN also negotiated the size of bribes that the party leaders required in order to authorize Smith to run on the Republican ballot line. During a meeting with the UC, Tabone accepted a $25,000 cash bribe and agreed to accept another $25,000 after his committee authorized Smith to compete in the Republican primary. Savino similarly accepted a $15,000 cash bribe and agreed to accept another $15,000 after he voted to authorize Smith to compete for the Republican ballot line. In return for his efforts, HALLORAN accepted $15,500 as a down payment on a “broker’s” fee of at least $75,000 and expected to be appointed First Deputy Mayor if Smith was elected mayor.

Bribery for City Council Discretionary Funding

From August 2012 until his arrest in April 2013, HALLORAN accepted an up-front kickback of $15,000 cash from the UC and the CW in exchange for agreeing to steer up to $80,000 in New York City Council discretionary funding to a consulting company he believed was controlled by the UC and the CW (the “Company”).

At a meeting on September 7, 2012, at which HALLORAN and the UC discussed HALLORAN’s need to raise money for his congressional campaign, HALLORAN agreed to hire someone of the CW’s choosing for a congressional staff or some equivalent position, and to help him raise money for his campaign. During the discussion, HALLORAN said: “That’s politics, that’s politics, it’s all about how much. Not whether or will, it’s about how much, and that’s our politicians in New York, they’re all like that…And they get like that because of the drive that the money does for everything else. You can’t do anything without the f***ing money.” During the meeting, the CW paid HALLORAN $7,500. And near the end of the meeting, HALLORAN remarked: “Money is what greases the wheels – good bad, or indifferent.”

In furtherance of this scheme, HALLORAN wrote two letters on New York City Council letterhead about this funding, one to civic organizations and the other to the Company. Despite suggesting in these letters that work would be done by the Company to support the allotment of taxpayer money, HALLORAN agreed with the UC and the CW that the Company would provide no services.

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In addition to the prison term, HALLORAN, 42, of Queens, New York, was also sentenced to two years of supervised release, and ordered to forfeit $45,300. HALLORAN’s co-conspirators, Smith and Tabone, were convicted for their roles in the bribery conspiracy in January 2015 and are currently scheduled to be sentenced by Judge Karas on July 1, 2015.

In the sentencing of HALLORAN, Judge Karas remarked, “This was a very serious crime. When a public official gets into cars and takes wads of cash or promises public money in return for cash to the politician, it is so troubling. It causes us all to be cynical about our leaders. It causes us to doubt that our leaders are looking after us. And it’s a very serious matter.”

Mr. Bharara praised the outstanding investigative work of the Federal Bureau of Investigation and Rockland County District Attorney’s Office.

This case is being handled by the Office’s White Plains Division and Public Corruption Unit. Assistant United States Attorneys Douglas B. Bloom and Justin Anderson are in charge of the prosecution.

 

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