February 5, 2015

Former State Senate Leader Malcolm Smith and Queens GOP Leader Vincent Tabone Found Guilty in White Plains Federal Court of Bribery and Fraud Charges Connected to 2013 NYC Mayor’s Race

Preet Bharara, the United States Attorney for the Southern District of New York, and Thomas P. Zugibe, the Rockland County District Attorney, announced that former New York State Senate leader MALCOLM SMITH was found guilty in federal court of bribing New York City Republican leaders, including Queens County Republican Party Vice Chairman VINCENT TABONE, who was also convicted of receiving bribes, to allow SMITH, a Democrat, to run as a Republican candidate for New York City Mayor in 2013. SMITH was also found guilty of extortion for his role in obtaining New York State funding for a real estate project in Spring Valley, New York, in exchange for cash bribes paid on his behalf to the New York City Republican Party chairmen. In addition, TABONE was convicted of witness tampering when he attempted to persuade former Queens County Republican Party Chairman Philip Ragusa not to testify against him. The two were convicted after a four-week jury trial before U.S. District Judge Kenneth M. Karas.

Manhattan U.S. Attorney Preet Bharara said: “As the jury unanimously found, the give-and-take of the political process should not be the giving and taking of bribes, which is what Malcolm Smith and Vincent Tabone tried to make it. Smith gave, and Tabone took, a $25,000 cash bribe to permit Smith to run for New York City Mayor as a Republican. Smith and Tabone were not alone in this scheme—Smith also bribed Daniel Halloran, another Republican Party official. And sadly, this was just one of many pockets of corruption this Office has uncovered in New York, which has become the ‘show me the money’ state. It should not be asking too much to expect public officials at least to obey the law. This Office will continue the vigorous prosecution of political corruption until every public official understands that violating the public trust will likely land you in prison.”

Rockland County District Attorney Thomas P. Zugibe said: “The facts put forth at this trial and the resulting verdict clearly display how official corruption can potentially impact our system of government and how it can be stopped. I’d like to thank the United States Attorney’s Office for taking this case to a successful conclusion and I commend our federal partners and the members of my staff for their efforts. I look forward to future success in rooting out corruption through the continued efforts of the United States Attorney’s Office, the Federal Bureau of Investigation, and the Rockland County District Attorney’s Office through our Public Corruption Task Force.”

According to the Complaint and the Indictment filed in federal court and the evidence presented at trial:

The Bribery and Extortion Schemes

SMITH was first elected to the New York State Senate in November 2000, and represented a district within Queens, New York. He was Chairman of the Independent Democratic Conference of the State Senate and, among other positions, has served as the State Senate’s minority and majority leader and acting lieutenant governor. From November 2012 through April 2, 2013, SMITH agreed with former New York City councilman Daniel Halloran, who was convicted in a separate trial, and 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 county leaders, including TABONE, in exchange for their authorization for SMITH to appear as a Republican candidate for New York City Mayor in 2013, even though SMITH is a registered Democrat.

SMITH participated in two overlapping criminal schemes that involved the payment of bribes to obtain official action. First, SMITH authorized the payment of $110,000 in cash bribes to be paid to leaders of the New York City Republican Party, including TABONE, so that they would allow SMITH to run for mayor on the Republican Party’s ballot line. Second, SMITH agreed to use his influence to help steer at least $500,000 in New York State transportation funding to a real estate project the UC and CW had proposed to develop in Spring Valley, New York, in exchange for the UC and CW paying bribes on SMITH’s behalf to the New York City Republican Party Chairs.

In furtherance of the scheme, SMITH authorized the UC and the CW to meet TABONE, the Executive Vice Chairman of the Queens County Republican Party, Joseph Savino, the Chairman of the Bronx County Republican Party, and other party leaders. During a meeting with the UC, TABONE accepted a $25,000 cash bribe in a dimly lit SUV parked in front of a Manhattan restaurant 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 in negotiating the bribes, Daniel 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.

Witness Tampering

Shortly before the start of a previously scheduled trial, the Government sought permission from the Court to take the deposition of Philip Ragusa, the former Chairman of the Queens County Republican Party. Ragusa, who was gravely ill at the time, was expected to testify favorably to the Government. Over TABONE’s objections, the Court ordered the deposition to take place. An hour before the scheduled start of the deposition, TABONE unexpectedly appeared at Ragusa’s home and attempted to pressure Ragusa not to testify against him.

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SMITH, 57, and TABONE, 48, both of Queens, New York, were found guilty of one count of conspiracy, which carries a maximum sentence of five years in prison; one count of wire fraud, which carries a maximum sentence of 20 years in prison; and one count of Travel Act bribery, which carries a maximum sentence of five years in prison. SMITH was separately convicted of one count of extortion, which carries a maximum sentence of 20 years in prison, and TABONE was separately convicted of one count of witness tampering, which carries a maximum sentence of 20 years in prison. Each of the counts of conviction also carries a maximum fine of $250,000, or twice the gross gain or loss from the offense.

SMITH and TABONE are scheduled to be sentenced by Judge Karas on July 1, 2015, at 10:00 a.m. and 11:00 a.m., respectively.

Mr. Bharara praised the outstanding investigative work of the Federal Bureau of Investigation and the 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, Justin Anderson and Perry Carbone are in charge of the prosecution.