Insurer Pleads Guilty to Charges in $7 Million Theft From Charity

The insurance company owner, Joseph Ross, who was charged with pocketing at least $ 1 million himself, appeared in State Supreme Court on Wednesday before Justice Michael J. Obus, according to a spokesman for the New York State attorney general, Eric T. Schneiderman, whose office is prosecuting the case.

Mr. Ross, 58, pleaded guilty to first-degree grand larceny, first-degree money laundering and third-degree tax fraud, admitting his role, the spokesman said in an email.

Under the scheme, Mr. Ross’s company, Century Coverage of Valley Stream, sent inflated invoices to the social service organization, the Metropolitan New York Council on Jewish Poverty, according to criminal complaints filed in the case. Mr. Ross and the group’s then-executive director, William E. Rapfogel, along with another conspirator, then split the excess money.

Mr. Rapfogel was a widely respected and admired figure in New York’s Jewish community until the alleged fraud was uncovered this summer, when he was fired. Mr. Rapfogel has been friends since childhood with the Assembly speaker, Sheldon Silver; his wife, Judy, has served as Mr. Silver’s chief of staff since the 1970s.

The crimes to which Mr. Ross pleaded guilty carry a maximum sentence of 25 years in prison. The terms of Mr. Ross’s plea were sealed, as were the minutes of the proceeding before Justice Obus, and the spokesman would not provide details.

Mr. Ross’s lawyer, Benjamin Brafman, declined to comment. Last month, after his client’s arrest, Mr. Brafman said, “Mr. Ross intends to address these issues in a very responsible fashion.”

Court papers in the case have said that Mr. Ross, Mr. Rapfogel, who is known as Willie, and another defendant, David Cohen, who was Mr. Rapfogel’s predecessor at Met Council, have all made statements to investigators.

Several people with knowledge of the case have said that all three men have provided extensive information to the investigators and assistant attorneys general handling the case. Several have suggested that the authorities have been skeptical of Mr. Rapfogel’s account of the events, although it is unclear precisely what he has said that has raised their suspicions.

Court papers in the case said that Mr. Rapfogel funneled some of the stolen money into political contributions to candidates for city, state and federal offices in the names of Century owners and employees. Mr. Rapfogel, according to the papers, instructed Mr. Ross to make contributions to various candidates and political organizations, and Mr. Ross regularly delivered checks for the contributions to Mr. Rapfogel.

More than $ 120,000 was provided to candidates for city offices, and tens of thousands of dollars more went to candidates for state and federal offices, according to the papers.

Met Council, a nonprofit organization that receives tens of millions of dollars in city, state and federal financing, cannot legally make such contributions itself.

Mr. Rapfogel’s wife, Judy, who has not been implicated in the Met Council investigation, has also been at the nexus where campaign finances and Mr. Ross’s company have met. During her unsuccessful 1997 campaign for City Council, she spent more than $ 8,000 on auto insurance from Century, a disproportionate amount of her campaign’s $ 160,000 budget — double what the campaign spent on leasing cars.

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