Hedge fund founder sentenced to 7 months for $20M scam of NYC COs union
COBA is still trying to recover its investment, which came from union retirement funds
By Stephen Rex Brown
New York Daily News
NEW YORK — A disgraced hedge fund founder was sentenced Tuesday to seven months behind bars for his role in a scheme that screwed the correction officers union out of $20 million.
Murray Huberfeld, 60, assisted Mayor de Blasio donor Jona Rechnitz in the bribery of former Correction Officers’ Benevolent Association President Norman Seabrook in 2014. Rechnitz gave Seabrook $60,000 cash in a Ferragamo bag as a kickback for investing $20 million of union money in Huberfeld’s hedge fund, Platinum Partners. Huberfeld then reimbursed Rechnitz with Platinum’s money, disguising the payment using an invoice for courtside Knicks tickets.
“The crime here involved forethought. It was a crime of deceit. It was a deceit of a firm he founded,” Judge Lewis Liman said in Manhattan Federal Court. “Mr. Huberfeld should have known better.”
The hedge fund went bankrupt in 2016. The Correction Officers’ Benevolent Association is still trying to recover its investment, which came from union retirement funds.
“Huberfeld engaged in a brazen plot to profit from the retirement funds of New York City correction officers. Mr. Huberfeld’s only concern was lining his pockets without any regard to the consequences of his actions or the hurt it would cause to our members,” union President Benny Boscio said.
Huberfeld tearfully apologized, saying he’d let down his Holocaust-survivor parents, both of whom died while his charges were pending.
“I apologize deeply to the union members,” Huberfeld said. “I only hope to show everyone present I can and will do better.”
Attorney Andrew Levander asked for leniency, citing Huberfeld’s health problems and generosity.
Huberfeld said he has already paid the Correction Officers’ Benevolent Association $5.5 million and pledged to pay an additional $1.5 million.
The long-running case was recently surrounded by intrigue involving Judge Alvin Hellerstein, who sentenced Huberfeld to 2½ years in prison in 2019. That sentence was overturned on appeal.
It emerged last year that Hellerstein was close to a former executive of Platinum Partners who cooperated with the feds in a separate trial over the hedge fund’s collapse. Huberfeld’s lawyers argued Hellerstein’s friendship with the executive gave the appearance the judge was not impartial when he imposed sentence.
Hellerstein then transferred the case to Liman.
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