The scandal involving the Metropolitan Council on Jewish Poverty, which provided a stunning example of charities fraud and toppled one of the Jewish communal world’s most respected figures, might not be over, The Jewish Week has learned.
That revelation came in an exclusive interview Thursday with Eric Schneiderman, New York State’s attorney general, who suggested that his office may be broadening its probe after convicting Met Council leaders of inflating insurance bills. The extra money, which totaled $9 million in insurance overpayments over the course of 20 years, went primarily to the campaign coffers of political leaders who have helped Met Council win state and city contracts to aid the city’s poor.
Schneiderman was circumspect about the continuing probe, saying only: “The investigation has not yet wrapped up.”
He disclosed that his office is following up leads provided by Met Council’s former CEO, William Rapfogel, 59, who pleaded guilty to pocketing more than $1 million in the kickback scheme and was sentenced in July to 3 1/3 to 10 years.
“He [Rapfogel] has provided us with some other angles. There are a few angles we’re following up on that are separate from the current board.” Schneiderman stressed, “There is no allegation that anyone on the current board is a target of the investigation.”
The attorney general expressed “confidence” that about a year after the scandal first broke the current management of the once-influential agency has righted the ship.
“I’ve been working with the board,” Schneiderman said on Thursday. “This was not a case of a board being asleep at the wheel; they flagged the problem and brought it to our office. … The scandal hurts. It’s very challenging because these nonprofits are dependent on raising money. But [Met Council is] spinning off some of the services they provided. And I am absolutely sure that anyone giving them a donation should feel confident that it is going for the purposes for which it was intended — to provide services.”
One of the lingering questions surrounding the Met Council scandal is whether Rapfogel’s longtime friend and powerful political ally, Assembly Speaker Sheldon Silver, might somehow be implicated. The two are fellow residents of the Lower East Side and, as power brokers in the area, have been involved in real estate development issues there for years. And Rapfogel’s wife, Judy Rapfogel, is Silver’s the longtime chief of staff.
While Schneiderman, a Democrat who is running for re-election Nov. 4 against Republican challenger John Cahill, expressed faith in the current leadership of Met Council, he suggested that other shoes might drop regarding the joint investigation between his office and that of the state comptroller.
Political observers say that it would be highly unlikely for Silver, a political powerhouse, to be a target. “Schneiderman would only go after Shelly if there was something really egregious,” says a highly placed source. “And Willie would never give Shelly up.”
More likely, says the source, is that the “slush fund was used in ways where people have culpability — a quid pro quo with a politician or a violation of campaign finance law.”