Two municipal leaders on New York's Long Island were arrested on federal corruption and bribery charges.
The United States Attorney's Office announced Thursday that Nassau County Executive Ed Mangano and Oyster Bay Town Supervisor John Venditto were charged as part of a 13-count federal indictment that include conspiracy to commit federal program bribery and honest services fraud.
Federal prosecutors allege that between January 2010 and February 2015, Mangano and Venditto, along with others, engaged in a scheme to receive bribes and kickbacks from a Long Island restaurant owner. Some of these benefits included hotel visits, travel expenses and limo services as well as gifts such as watches and massage chairs.
"Mr. Mangano and Mr. Venditto received bribes and kickbacks from their co-conspirator on an on-demand basis as opportunities arose in connection with business dealings with Nassau County and in the Town of Oyster Bay," said U.S. Attorney Robert Capers in a press conference announcing the charges. "The official actions taken by Mr. Mangano and Mr. Venditto included among other things the Town of Oyster Bay's guarantee of four loans totaling in excess of $20 million to the co-conspirator from a bank and from a lender and Nassau County's award to the co-conspirator of lucrative contracts worth hundreds of thousands of dollars to provide food services to various Nassau County agencies."
Prosecutors did not identify "co-conspirator number one", but sources told Newsday that the name is Harendra Singh, a Long Island restaurateur who the FBI charged last year with bribing Oyster Bay officials to receive the $20 million in loan guarantees for some of his businesses. Mangano's wife Linda was also charged in the indictment, with prosecutors saying she received a more than $450,000 "no-show job" from April 2010 to August 2014 at one of his restaurants.
Mangano, a Republican, was first elected Nassau County executive in 2009 after previously serving as a county legislator. Venditto, also a Republican, has run New York State's fourth largest township since 1998.
"There is much more work to be done as Nassau County Executive and I will continue to govern this county," Mangano said in a statement. Venditto’s press office did not immediately respond for comment.
Nassau County Comptroller George Maragos, who announced plans this month to run for county executive next year, called on both Mangano and Venditto to resign.
"Their alleged actions, if proven true, are a betrayal of the public trust and further shake our trust in government," said Maragos in a statement. "Given the nature of the charges, it would be in the best interest of the County if both would resign in order to allow the people's work to be conducted with unquestionable integrity."
S&P Global Ratings slashed Oyster Bay's bond ratings two notches to BB-plus in late April citing weak financial management that led to recent negative fund balances, including a $19 million operating deficit in the 2014 fiscal year. Venditto told The Bond Buyer in July that the town's credit rating, which was high as triple-A in 2011, has been hampered by miscalculated revenues and a sharp drop in annual mortgage taxes following the 2008 recession.
Nassau County, which is rated A2 by Moody's Investors Service, has also faced fiscal challenges in recent years balancing its budgets. The Nassau Interim Finance Authority has controlled the county's finances since 2011.
"At this time, Moody's does not expect the corruption charges to have an effect on the county's credit quality," Moody's analyst Cristin Jacoby said in a statement Thursday. "Management has stated there is no reason to suspect the charges will have a budgetary impact and internal financial operations are continuing uninterrupted. We will continue to monitor the situation as it develops."
