All 70 employees of the New York City Housing Authority (NYCHA) who were arrested and charged in February 2024 have now been convicted on charges related to bribery, fraud, or extortion. The announcement was made by Jay Clayton, United States Attorney for the Southern District of New York, along with leaders from several federal investigative agencies.
Of those charged, three defendants were convicted after jury trials. Fifty-six pled guilty to felony offenses and eleven pled guilty to misdemeanor offenses. Sentencing is ongoing; so far, sentences have reached up to 48 months in prison. The total bribes accepted exceeded $2.1 million, connected to NYCHA contracts worth more than $15 million. Collectively, the defendants will pay over $2.1 million in restitution and forfeit more than $2 million in criminal proceeds.
“Today’s plea of the 70th and final NYCHA pay-for-play contracting scheme defendant marks an important milestone in one of the largest single-day corruption cases in the history of the Justice Department,” said U.S. Attorney Jay Clayton. “All 70 charged defendants have now been convicted for attempting to criminally leverage the contracting process of work for affordable housing for New Yorkers to line their own pockets. NYCHA residents deserve better. New Yorkers deserve better. This broad and swift action demonstrates our Office’s commitment to combatting corruption in our nation’s largest public housing authority—home to 1 in every 17 New York City residents.”
Jocelyn E. Strauber, Commissioner of the New York City Department of Investigation (DOI), noted that nearly a third of NYCHA’s developments across all five boroughs were affected by these schemes: “Today, the last of the 70 NYCHA employees charged with bribery and extortion in connection with the awarding of micro-purchase contracts pled guilty, closing the chapter on an investigation in which DOI and our federal partners exposed widespread corruption that touched almost one-third of NYCHA’s 365 developments in each of the five boroughs.” She added that DOI’s recommendations for improved controls over micro-purchase contracting at NYCHA have since been implemented.
Brian D. Harrison, Acting Inspector General at HUD-OIG, stated: “Today’s final guilty plea is an important milestone in bringing to an end the egregious pay-to-play bribery scheme that wasted millions of dollars that should have benefited HUD tenants in New York and raised serious questions about the integrity of NYCHA operations.” He emphasized that all involved employees admitted guilt or were found guilty within two years.
Ricky J. Patel from Homeland Security Investigations described this as “the largest number of federal bribery charges in a single day” ever brought forward: “Today’s guilty plea is the latest step in exposing a scheme that exploited NYCHA’s operations… Working…with our federal, state, and local law enforcement counterparts, HSI will keep pressing forward to protect New Yorkers and ensure that anyone who attempts to jeopardize their well-being faces decisive consequences.”
Jonathan Mellone from DOL-OIG highlighted their agency’s role: “The seventy convictions obtained in this investigation send a clear message that public corruption will not be tolerated.”
Harry T. Chavis from IRS-CI added: “IRS-CI will continually use its unique expertise in tax and finance to find leverage assisting with complex investigations.”
According to court documents and proceedings referenced by prosecutors:
NYCHA provides housing for approximately one out of every seventeen residents citywide through more than three hundred developments throughout New York City; it receives over $1.5 billion annually from HUD.
While most repairs or construction require competitive bidding processes when contracts fall below a certain value threshold—at times up to $10,000—designated staff could award them without multiple bids under a “no-bid” system.
During this period covered by these cases all convicted individuals demanded cash payments ranging typically between ten percent (10%)–twenty percent (20%) per contract—or between $500–$2,000 depending on size—in exchange either before awarding contracts or before signing off on completed work required for payment processing.
Jay Clayton commended investigators at DOI-HUD-OIG-HSI-DOL-OIG-IRS-CI as well as his office’s special agents/task force officers for their efforts throughout this case.
These prosecutions are managed by Assistant U.S Attorneys Jerry J Fang-Jacob R Fiddelman-Meredith Foster-Catherine Ghosh-Justin Horton-Emily Deininger-Jane Kim-Matthew J King-Amanda C Weingarten—all members handling matters within SDNY’s Public Corruption Unit.
