Wednesday, January 29, 2014

Worse Than Michael "Mikey Suits" Grimm-- Steve Israel And Congress' Culture Of Corruption


Israel never turned over any of the tainted Madoff cash that flowed his way

The DCCC is making a lot of hay lately about all the trouble Michael Grimm (R-NY) is in with the law-- and they should. He's lowlife scum who disgraces Congress with his very presence. Earlier today we looked at the shady fundraising techniques Grimm and co-conspirator Aaron Schock (R-IL) have engaged in. A regular and very reliable correspondent from Capitol Hill emailed me this:
You're getting closer to uncovering the real criminal activities Grimm has been engaging in from long before he was elected to Congress. But why did you leave out our side of the aisle? Why not drag in the Steve Israel-Bernie Madoff connection?
Ah, yes, the long whispered about Steve Israel-Bernie Madoff connection. A few weeks ago we mentioned, in passing, how Steve Israel ripped off his synagogue and then broke serious campaign finance and tax law when the synagogue board threatened to go to the media. To reiterate:
One of Israel's Long Island neighbors, a constituent and on the board of the synagogue Israel attended, wrote this on his blog a few months ago:
My "Representative" Steve Israel is more than someone with whom I disagree with politically. He is a man with the moral fiber to stiff a Synagogue out of thousands of dollars when he decided to move (a debt that was eventually paid by an anonymous donor when a member of the Synagogue's board threatened to release the info to the press-- yes that was me).
The "anonymous donor," basically gave a hefty bribe to Israel-- a tax-deductible one-- by paying off his debt. It's so illegal and unethical!
That was when my friend on Capitol Hill sent me an amazing spread sheet of major Steve Israel donors, Howard Wohl and Lawrence Simon, who were tied to the Madoff scandal in a major way. Both were sued in connection to the case by then-NY Attorney General Andrew Cuomo and the settlement was $210 Million. When Israel applied for the DCCC chair it was because he said he could deliver-- which he did-- major donors like Wohl and Simon. Wohl particularly gave tens of thousands of dollars to the DCCC and the associated House Majority PAC and well as to Israel himself and other candidates Israel pointed him to.

Another big Israel donor, Fred Wilpon, a real estate developer and the majority owner of the Mets, was also associated with the Madoff case. According to a source inside the case, when Wilpon was crying about having "lost" $700 million in Madoff's ponzi scheme, he was actually hiding the fact that he didn't lose, but had profited by $300 million. Eventually he had to settle with the trustee for Madoff victims to the tune of $86 million. The Wilpons previously had to settle on another Ponzi scheme (masterminded by Samuel Israel) they were involved in with the  Bayou Group LLC.
The owners of the New York Mets baseball team, subject to a demand by the trustee liquidating Bernard Madoff’s firm to pay $1 billion to end a fraud lawsuit, may model any settlement on a deal they struck over their involvement in the Bayou Group LLC’s Ponzi scheme.

In the Bayou settlement, the Mets owners gave up all fake profits they made in that $400 million fraud plus 44 percent of their principal after a judge ruled their initial investment could be pursued because of “red flags” they saw about the possibility of a fraud.

Trustee Irving Picard had said in court papers that he wants to recover about $300 million in alleged phony profits from Madoff’s scheme made by Sterling Equities Inc., which owns the Mets baseball team, Mets Chairman Fred Wilpon, Mets President Saul Katz and Chief Operating Officer Jeff Wilpon, and other related parties. Picard also demanded an unspecified amount of principal back from the Sterling defendants.

Today, Picard lawyer David Sheehan said the trustee is seeking a total of $1 billion from the defendants. To recover the additional $700 million, the trustee must prove, “using the red flags and other evidence,” that the Sterling defendants had enough information that they should have discovered the fraud, Sheehan said in an e-mail.

…Howard Wohl, co-founder of Ivy Asset Management LLC, warned Saul and David Katz and Arthur Friedman about Madoff at a meeting in early 2002 to discuss the formation of the Merrill- owned entity, Sterling Stamos, a hedge fund partnership of Sterling and Peter Stamos, Picard said.

Former New York Attorney General Andrew Cuomo sued Ivy, Wohl and Ivy Chief Executive Officer Lawrence Simon in May.

Cuomo, now New York’s governor, claimed Ivy and the executives hid their doubts about Madoff from their own customers, who lost $227 million while the firm reaped $40 million over 10 years for Madoff-related work.
These three characters and their families gave the DCCC under Israel-- and Israel individually-- over half a million dollars, sometimes in small amounts like $250 and $500 increments, other times in $30,000 and $25,000 lump sums. None of the tainted cash was ever returned or donated to charity or anything like that. So, yes, Michael Grimm and Aaron Schock should be prosecuted to the full extent of the law and both should spend the next decade in prison. Steve Israel? Much worse. Nothing will happen because both parties do it-- and do it a lot.

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