He received envelope after envelope, stuffed with skimmed cash kickbacks, according to a criminal complaint filed on Tuesday. Also cited were a $ 27,000 check written to a contractor working on his apartment, roughly $ 100,000 to help his son buy a home, and a campaign finance scheme that manipulated the city’s matching-funds formula, fraudulently increasing campaign contributions to favored city politicians who provided government grants to his organization.
Over two decades at the nonprofit Metropolitan New York Council on Jewish Poverty, Mr. Rapfogel and two confederates stole more than $ 5 million, much of it taxpayer money, said the complaint, which detailed the schemes and charged Mr. Rapfogel with grand larceny, money laundering and other crimes.
Some of the money went to the co-conspirators, who were not named in the complaint; some of it was directed to politicians and political organizations. Mr. Rapfogel, a man whose deeds and connections made his name almost synonymous with the city’s Jewish philanthropic causes, was accused of keeping more than $ 1 million for himself.
The cash-stuffed envelopes clearly added up. Investigators found $ 400,000 squirreled away in his Lower East Side apartment — a sizable chunk in his closet — and in his home in Monticello, N.Y., according to the complaint and a person briefed on the matter.
Mr. Rapfogel acknowledged unspecified wrongdoing when the charitable organization, known widely as Met Council, uncovered the financial improprieties and fired him last month, issuing a statement saying, “I deeply regret the mistakes I have made that led to my departure.”
On Tuesday, Mr. Rapfogel, dressed in a blue suit with a white shirt and no tie, was arraigned in a brief proceeding before Judge Kevin McGrath in Manhattan Criminal Court. He did not enter a plea and waived his right to a speedy trial, suggesting that he was or would be involved in plea negotiations. Judge McGrath released him on $ 100,000 bail.
After the hearing, Mr. Rapfogel declined to speak to reporters outside the courtroom. But his lawyer, Paul L. Shechtman, said: “Mr. Rapfogel hopes for a fair resolution of this case and will continue to make amends to Met Council. It’s a sad day, but happily people who know Willie well are still in his corner.”
The charges, which the complaint said were in some measure based on investigators’ interviews with Mr. Rapfogel and the two people referred to as co-conspirators, stem from an inquiry by the state attorney general, Eric T. Schneiderman, and the state comptroller, Thomas P. DiNapoli. They began to look into Mr. Rapfogel’s stewardship of Met Council after the organization detected the improprieties and alerted state authorities.
“It’s always sad and shocking when we discover that someone used a charity as their own personal piggy bank — but even more so when that scheme involves someone well respected in government and his community,” Mr. Schneiderman said in a news release announcing the charges.
Mr. DiNapoli said, “The scale and duration of this scheme are breathtaking.”
Their investigation revealed that Mr. Rapfogel conspired with Met Council’s insurance broker, Century Coverage Corporation, to pad the agency’s insurance payments by hundreds of thousands of dollars a year, according to the complaint.
The two co-conspirators set up the scheme before Mr. Rapfogel joined the council as executive director, but under his watch, the amount artificially added to the annual cost for insurance steadily increased.
As part of the scheme, officials said, Mr. Rapfogel directed a co-conspirator at Century to make the political donations on behalf of Met Council, using money obtained from the padded payments. That co-conspirator delivered regular checks for the campaign contributions to Mr. Rapfogel, who in turn passed the checks on to various politicians and political organizations.
The complaint said that Mr. Rapfogel brought his political savvy to bear in a way that increased the benefit to favored candidates — almost like campaign contributions on steroids. The complaint said that for certain political contributions, Mr. Rapfogel directed that separate checks in smaller amounts should be obtained from multiple donors rather than one large check, to maximize the use of city’s matching-funds program, which provided a six-to-one increase with public funds.
Because the program included a cap of $ 1,050 per contribution, a $ 600 donation would garner $ 1,050 while four $ 150 donations would bring in a total of $ 3,600.
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