18 Held in Probe of Fraud in N.Y.C. Facilities Division

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Federal prosecutors have charged four former New York City board of education employees and 14 others with felonies following a probe of bribery, fraud, and racketeering in the school system's leasing and maintenance of buildings.

The investigation of district employees involved with facilities and the lawyers and contractors who dealt with them uncovered evidence of $4.6 million in fraud and $260,000 in bribes, the U.S. Attorney for the Southern District of New York said last month.

The four-year joint federal, state, and local probe, called "Operation Tightrope'' and involving undercover agents and surveillance, found evidence of criminal wrongdoing dating back to 1981 and continuing until last month, according to federal officials.

The school board responded to the charges by ordering the immediate suspension of most new leasing of district buildings and directing Schools Chancellor Ramon C. Cortines to clamp down on property management.

"This system serves children, and when you cheat it, you do nothing less than cheat children,'' Mr. Cortines said.

Follows Earlier Scandal

The charges come five years after a racketeering scandal led the state legislature to strip the district's school-facilities division of its power to build new schools.

The agency created by the legislature to oversee school construction, the New York School Construction Authority, was not implicated in the recent probe.

Instead, most of the charges relate to activities that occurred before 1989 or that remained within the purview of the facilities division after then. They included building leasing and maintenance and asbestos and lead removal.

The prosecutors allege that contractors and their lawyers bribed or attempted to bribe district officials into awarding contracts, expediting payments for projects, and approving fraudulent invoices.

Among those arraigned was Sheldon Rosenblum, the former deputy counsel in the school board's office of legal services, whose post was created largely to clean up fraud and corruption. He has been accused of taking at least $150,000 in bribes from one builder in exchange for confidential information about contracts. The U.S. Attorney's office said he has entered a plea agreement under which he has agreed to plead guilty, pay restitution, and forfeit his city pension.

Joseph Tantillo, the district's assistant deputy director for technical services, has pleaded guilty to racketeering conspiracy for accepting $50,000 in bribes between 1989 and 1992. He has been suspended without pay.

Vol. 13, Issue 36

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