New YorkAssembly Speaker Sheldon Silver is under arrest and $3.8 million in eight different bank accounts held by Silver have been seized, as federal prosecutors accuse the Speaker of running two fraudulent and corrupt schemes.
U.S. Attorney Preet Bharara laid out the charges against the Assembly Speaker Thursday, saying the Speaker used his “titanic” powers in office to amass a “tremendous” personal fortune by running two separate schemes that involved millions of dollar in bribes and kickbacks.
Bharara says the Speaker told the public and filled out required disclosure forms that said he worked at the law firm Weitz and Luxenburg, where private citizens hired him to represent them in personal injury lawsuits. Silver also said that none of his clients had any business before the state. The Speaker at one time said he represented “plain, ordinary, simple people.”
But the U.S. Attorney says instead Silver was “secretly pocketing” millions of dollars illegally obtained in attorney referral fees.
Bharara says the “head scratching” over what Silver did to earn all of that “substantial outside income” can now end.
“He does nothing,” Bharara said. “He simply sat back and collected millions of dollars by cashing in on his public office and political influence.”
Silver is accused of secretly directing half a million dollars in state funds to a doctor who treated asbestos related cancers and conducted research. That doctor, the complaint alleges, then steered those patients to Weitz and Luxenburg, which is involved in a major asbestos class action lawsuit.
Silver claimed to have personally referred hundreds of asbestos cases to Weitz and Luxenburg in exchange for his fees, but when federal investigators contacted the clients, they said they’d never heard of Silver.
The complaint also alleges that Silver steered real estate developers to a law firm that deals in obtaining tax breaks for the developers and received a kickback for his efforts. The law firm is run by a previous Silver aid.
Two major developers with buildings in Silver’s district received the majority of the tax breaks from the law firm. Those developers also had active business before the state, including hiring lobbyists to meet with Silver to keep on the books special tax breaks that benefited them.
The Assembly canceled its scheduled session, in light of the speaker’s arrest, but Assembly Democrats met in a private meeting for around 90 minutes. Then emerged to say they are sticking with Silver for now.
Assembly Majority Leader Joe Morelle says it’s a sad and troubling day, but that the Democrats will “stand with” Silver.
“I don’t think there’s any question that the members have concerns,” said Morelle. “Having said that, there’s a strong belief in the presumption of innocence.”
Republicans in the Assembly are calling on Silver to resign.
Silver’s attorneys issued a statement, saying they are “disappointed that the prosecutors have chosen to proceed with these meritless criminal charges,” and that Silver looks forward to his “full exoneration.”
Each of the five counts that Silver is charged with carry a maximum penalty of up to 20 years in prison.
The Speaker is expected back at the Capitol on Monday to preside over the session.
