Jona Rechnitz Investigation Linked To Hedge Fund Investment

NEW YORK – A businessman at the center of a federal corruption probe involving New York police officers and Mayor Bill de Blasio’s fundraising helped arrange an investment by the correction officers’ union in a hedge fund, a person familiar with the matter said on Thursday.

Jona Rechnitz, who heads a New York real estate firm, referred the president of the city’s Correction Officers’ Benevolent Association, Norman Seabrook, to Platinum Partners, which received an investment of at least $10 million, the source said.

The probe by the Federal Bureau of Investigation and Manhattan U.S. Attorney Preet Bharara’s office is examining whether police officers received gifts and travel from businessmen in exchange for favors, said the source, who was not authorized to speak publicly.

The investigation continues to make headlines in New York and has already resulted in the reassignment of five high-ranking members of the New York Police Department.

The connection of Platinum Partners to the probe, which is examining Rechnitz and Seabrook, was first reported by the Wall Street Journal earlier on Thursday.

Reuters on Wednesday was first to report the union invested in Platinum Partners.

Marc Harris, Rechnitz’s lawyer, and a spokesman for the union declined to comment.

A spokesman for Platinum, a New York-based midsized hedge fund led by Mark Nordlicht, declined to comment.

The probe has centered on two businessmen, Rechnitz and Jeremy Reichberg, both of whom have ties to de Blasio, whose 2013 campaign committee has hired a criminal defense lawyer amid reports its fundraising efforts are being scrutinized.

Rechnitz and Reichberg served on de Blasio’s inaugural committee in 2013. Rechnitz contributed to his campaign, while Reichberg helped raise money for a nonprofit controlled by de Blasio advisers to support the mayor’s goals.

The investigation has also included former Chief of Department Phillip Banks, once the police department’s highest-ranking uniformed officer, and Seabrook, head of the correction officers union, the source said.

Banks earned $250,000 to $500,000 from unspecified investments from JSR Capital Inc, Rechnitz’s real estate firm, according to a financial disclosure report Banks filed in 2014.
A lawyer for Banks has previously denied wrongdoing.

De Blasio has said that he was confident his campaign and administration had not committed any improprieties.

On Tuesday, de Blasio told reporters that a lawyer for his campaign, Barry Berke, had reached out to prosecutors to say “we would like to be helpful in any way we can.”

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