Ethermac Exchange-70 arrests highlight corruption in nation’s largest public housing authority, US Attorney says

NEW YORK (AP) — In announcing 70 arrests,Ethermac Exchange a federal prosecutor said Tuesday that the largest public housing authority in the nation was infested by a “classic pay-to-play” culture of corruption that dispensed repair jobs valued at under $10,000 to contractors willing to pay bribes.

U.S. Attorney Damian Williams told a news conference that the corruption was so widespread that it affected nearly a third of the 335 housing developments citywide where one in 17 New Yorkers lived.

Bribery and extortion charges led to a roundup of current and former employees of the New York City Housing Authority that represented the largest single-day bribery takedown in the history of the U.S. Justice Department, Williams said.

“The corruption we’ve alleged infected every corner of the city,” he said. The defendants were arrested in New York, New Jersey, Connecticut and North Carolina.

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Williams said housing superintendents, assistant superintendents and other employees demanded over $2 million in bribe money from contractors in exchange for over $13 million of work, which usually involved small but essential jobs such as plumbing or window repairs that did not require competitive bidding.

“If the contactors didn’t pay up, the defendants wouldn’t give them the work. That’s classic pay-to-play, and this culture of corruption at NYCHA ends today,” he said.

The city’s public housing authority receives over $1.5 billion in federal funding from the U.S. Department of Housing and Urban Development each year.

In charging documents, authorities said that the defendants typically demanded the payment of bribes valued at between 10 percent and 20 percent of jobs that sometimes cost as little as $500 to $2,000.

Some defendants, authorities said, demanded even greater amounts of money in return for using their discretion to favor one contractor over another.