One Police Plaza

Unidentified “NYPD Officer” in Seabrook Complaint is Chief Phil Banks

June 13, 2016

Former NYPD Chief of Department Phil Banks is a behind-the-scenes presence in the corruption scandal involving former correction union boss Norman Seabrook; allegedly crooked Harlem restauranteur Hamlet Peralta; and Orthodox Jewish businessmen Jona Rechnitz and Jeremy Reichberg.

Banks’s name does not appear in the complaint of the politically powerful Seabrook, who was ousted as leader of the Correction Officers’ Benevolent Association after he was arrested on fraud and corruption charges last week. 

Rather, hints of Banks’s connection appear in five small paragraphs of the 17-page complaint. They reveal that Seabrook met Rechnitz in late 2013 through “an NYPD officer.” Numerous sources have identified the NYPD officer as Banks, who resigned from the NYPD in November, 2014, feeling he had been marginalized when Police Commissioner Bill Bratton promoted him to First Deputy. 

The complaint also discloses that the “NYPD officer” made four trips between November 2013 and July, 2014 — to the Dominican Republic, Israel and Las Vegas — with Seabrook, Rechnitz and Reichberg.

Rechnitz paid everyone’s airfare on the four trips. According to the complaint, he was not reimbursed.

On Banks’s trip to Israel in March, 2014, he met with Israeli and Palestinian dignitaries, even holding a news conference in police uniform at the Wailing Wall.

n a second trip, to the Dominican Republic in December 2013, Banks, Seabrook, Rechnitz and Reichberg were joined by Peralta, who owned the now-closed Hudson River Cafe that was frequented by NYPD brass. In a separate but apparently related case, Peralta has been charged with an alleged $12 million fraud scheme. Sources said that two of his investors were Rechnitz and Reichberg.
  
Rechnitz, who comes from a wealthy and politically prominent Orthodox Jewish Los Angeles family, secretly pleaded guilty to fraud charges and is a cooperating government witness against Seabrook. He is referred to in the complaint as “CW-l.”

Reichberg, a Hasidic Jew from Borough Park who is referred to as “CC-l,” is termed an unindicted co-conspirator. Both were donors to Mayor Bill de Blasio, whose 2013 campaign appears to be the ultimate target of the federal probe.

The complaint adds that Rechnitz introduced Seabrook to a hedge-funder friend, Murray Huberfeld, with whom Seabrook invested $20 million of the union’s funds. In return, Huberfeld, through Rechnitz, allegedly paid Seabrook a $60,000 kickback.

Huberfeld, of Lawrence L.I., whose family foundation has donated millions of dollars to Jewish charities and yeshivas, was convicted of fraud in 1993 after he had another person take his broker-licensing exam. In 1998, he and a partner paid $4.6 million to settle a civil complaint brought by the Securities and Exchange Commission that alleged bank fraud.

All this looks bad for Banks, but has he done anything criminal? To prove criminality, prosecutors must establish a quid pro quo. Banks’s free trips may have been a quid, but so far we have seen no quo while he was a member of the department.

Both Bratton and his predecessor, Ray Kelly, accepted free airfare. In his first tour as commissioner in the 1990s, Bratton took free plane trips from Wall Streeter Henry Kravis; and Kelly from his boss, Mayor Michael Bloomberg, who flew Kelly to his second home in Deerfield Beach, Fla., on his plane. In Bratton’s case, then-Mayor Rudy Giuliani used those free trips to suggest Bratton had done something untoward, and forced his resignation.

So what’s the difference between Bratton’s and Kelly’s free trips and Banks’s? Perhaps due to naivete, Banks’s four trips were taken with FOUR CROOKS — one of whom paid for all of them.

More damning information regarding his relationship with Rechnitz comes from Banks’s disclosure statement after retiring from the NYPD. In it, he indicated he earned between $250,000 and $500,000 from investments with Rechnitz, suggesting something improper. Closer scrutiny, however, reveals that the sum is what he invested with Rechnitz.

Similarly, the FBI has reportedly scrutinized Banks’s bank accounts, revealing thousands of dollars in monthly cash deposits. Sources point out, however, that similar deposits go back to 2000, indicating they were unrelated to Rechnitz, whom Banks met more than a decade later.