Gerald Migdol, a Harlem developer, became the linchpin in a federal investigation that led to the indictment and resignation of Lt. Gov. Brian Benjamin.
Gerald Migdol, right, leaves Federal District Court in Manhattan after his arrest last year.Credit..
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Nicholas Fandos, Jeffery C. Mays and
For the Harlem real estate developer Gerald Migdol, the annual charity golf outing in Westchester County was a showcase to display his generosity. Politicians, business associates and minor celebrities circled the private links, helping his small foundation pay for backpacks and Thanksgiving turkeys distributed to needy families.
The highlight of the September 2019 event, however, occurred off the course, when Mr. Migdol was presented with an oversized cardboard check for $50,000 in state grant money for his charity, Friends of Public School Harlem. The check surpassed any previous outside contribution and was hand-delivered by Harlem’s state senator, Brian A. Benjamin.
“It makes kids happy,” Mr. Migdol wrote on Facebook shortly after the tournament, posting a photograph capturing the moment. “What else do you want?”
This week, the check resurfaced — not as a record of the public service both men extolled, but as the linchpin of a corrupt quid pro quo scheme that led to charges against both men and forced Mr. Benjamin to resign as lieutenant governor on Tuesday, after less than eight months in office.
In the five-count federal indictment against Mr. Benjamin, prosecutors portrayed him as the mastermind of a secretive scheme to steer taxpayer funds to Mr. Migdol in exchange for tens of thousands of dollars in fraudulent campaign contributions — and then to cover it up.
It also became clear that Mr. Migdol began cooperating with investigators not long after his arrest in November, providing information that enabled them to charge New York’s second-in-command and upend state politics.
In his public life, Mr. Migdol, 72, presented himself as an investor and lawyer who made a windfall in Manhattan’s white-hot real estate market and then turned his focus to giving back to the community through charity to children and Democratic politics.
But a review of court documents, city contracts, nonprofit filings and other records by The New York Times, as well as interviews with more than two dozen current and former associates, points toward a history of blurring the lines among politics, charity and business to advance Mr. Migdol’s interests.
Mr. Migdol appears to have long used gifts and other giveaways to help advance his business interests — once drawing accusations before the City Council that he was trying to curry favor with tenants of a building he wanted to buy in the Bronx.
In another instance laid out by prosecutors, Mr. Migdol contributed $15,000 to a campaign committee for State Senate Democrats in 2020 after Mr. Benjamin told the developer that in return, he would help obtain a zoning variance at one of his Harlem properties.
Mr. Migdol has also leaned on his charitable record and political connections at times to help shield himself from legal threats. His website features dozens of photos of him alongside politicians including Andrew M. Cuomo and Bill Clinton, along with a prominent quote from Hillary Clinton praising the Migdol Organization for its “leadership role in addressing the health, education and welfare of Harlem’s citizens through the initiatives of its businesses and not-for-profits.”
And at the same time that he was helping poor families, Mr. Migdol drew substantial revenue from New York City’s homeless services programs. He has done business with two major operators who have faced federal criminal investigations — one of whom pleaded guilty — while collecting tens of millions of dollars in city funding through his family’s companies, city records show.
Mr. Migdol declined an interview request through his lawyer, Joel Cohen, who also declined to comment. Lawyers for Mr. Benjamin declined to comment.
In a city of real estate titans, Gerald Migdol was neither particularly well known nor that unusual.
The son of a Polish immigrant, Mr. Migdol has said he learned the business from his father, flipping buildings they renovated in downtown Manhattan. After a stint at a larger firm in the 1990s, he began “trying to buy ahead of the curve,” he told an interviewer in 2006, scooping up brownstones and small buildings in Harlem, including some he converted into rooming houses to benefit from generous Federal Section 8 rent subsidies.
Along the way, he got a law degree and declared bankruptcy at least twice. But his fortunes seemed to rise as he shifted his focus to housing for lower-income tenants and homeless people.
The exact size of his private portfolio, managed with his son Aaron, is difficult to determine because of their extensive use of shell companies, but corporate records show he has had a stake in several buildings in the area.
Mr. Migdol appears to have started work in homeless services more recently, serving as an operator and contractor for emergency shelters used by the city. In all, entities associated with Mr. Migdol took in at least $37 million from city agencies to provide homeless services for New Yorkers over the last decade. But other city and court records suggest actual revenues could be higher.
In some cases, Mr. Migdol has rented rooms in buildings he owns to larger shelter operators — including CORE Services Group and a company owned by the shelter executive Victor Rivera — in exchange for a portion of what they collect from the city.
CORE and Mr. Rivera have both subsequently come under criminal investigation. Mr. Rivera, the chief executive of the Bronx Parent Housing Network and another for-profit shelter group, was charged with pocketing hundreds of thousands of dollars in kickbacks from contractors. He wrote in a 2015 letter that he had been working with the Migdols for 15 years, and “they have proven to be an excellent provider of shelter housing.”
In 2014, the Migdols took an ownership stake in a building in Harlem where CORE operated a shelter. The relationship was testy; in a long-running lawsuit, the group accused the Migdols of trying to undermine their relationship with the city and force them out, but CORE remained there for years.
CORE has since run into deeper legal issues after revelations that the shelter group had paid millions of dollars to three for-profit companies owned by the nonprofit CORE group, which is run by Jack A. Brown III. Federal investigators have opened a criminal investigation into CORE’s practices, according to another lawsuit.
Mr. Migdol appears to have spun off other moneymaking businesses that piggybacked off the shelters, citing “security services, housing relocation services, pro bono legal services and case management” in a sworn 2015 affidavit in the CORE lawsuit.
Over the years, the proceeds helped pay for an apartment on the Upper West Side and a membership at St. Andrew’s Golf Club, the exclusive club in Hastings-on-Hudson, N.Y., where Mr. Migdol’s family owns a townhouse on the grounds and hosts the annual charity tournament.
Mr. Migdol also poured some of the money back into Harlem, most notably through Friends of Public School Harlem, the nonprofit he incorporated in 2014 to help provide school supplies, computers and musical instruments to the area’s public schools.
The group put on regular giveaways with another Migdol nonprofit that often attracted the attention of local news outlets and politicians like Mr. Benjamin, Representative Adriano Espaillat and the Manhattan district attorney, Alvin Bragg, among others. More recently, the giveaways came to include groceries, Thanksgiving meals, Christmas toys and masks.
Gary M. Rosenberg, a real estate lawyer on the board of Friends of Public School Harlem, said the organization operated with relatively little overhead: Mr. Migdol donated funds and raised money at the golf tournament, and most of it was spent on distributing goods.
Mr. Rosenberg, who joined the board after sponsoring Mr. Migdol for a membership at his golf club, conceded that while the board exercised little oversight, annual financial reviews never suggested anything unusual. Other board members included an actor from the original cast of “Hamilton,” a member of the Central Park Five, a prominent D.J. and Harlem community leaders.
“He was not doing this for an ulterior purpose,” Mr. Rosenberg said. “This is something that was his passion.”
Mr. Migdol’s generosity also extended to local Democratic politicians. Public campaign finance records show that Mr. Migdol, his family members and corporate entities they control gave more than $150,000 to the political campaigns of Mr. Benjamin, Assemblywoman Inez Dickens and Mark Levine, the Manhattan borough president, among others. At least $45,000 went to Letitia James, the state’s top law enforcement official; records do not show contributions to Mayor Eric Adams or Gov. Kathy Hochul.
His donations and his charitable work afforded him status in the New York City political world, with various public officials regularly attending his charitable events and handing him citations.
When Mr. Migdol held a 70th birthday bash in his Upper West Side apartment building in early 2020, Ms. James and Mr. Benjamin were among several prominent Democrats who attended. (Ms. James, Mr. Levine and Ms. Dickens have already returned or donated the funds, or plan to.)
Nearly a year before the birthday party, Mr. Benjamin had paid a visit to Mr. Migdol at home. The politician told Mr. Migdol that he was eyeing a run for New York City comptroller, and he needed help gathering the kind of small contributions that would unlock generous public matching funds through a city program.
Who is Brian Benjamin? A Democratic state senator from Harlem, he was selected by Gov. Kathy Hochul to be her lieutenant governor in a move widely seen as an attempt by Ms. Hochul to diversify her ticket before this year’s elections. Mr. Benjamin resigned from the position following an indictment in connection with a campaign finance scheme.
The investigation. Federal authorities have been investigating whether Mr.
Benjamin participated in an effort to funnel fraudulent contributions to his unsuccessful 2021 campaign for New York City comptroller. This inquiry stemmed from an indictment charging a Harlem real estate investor with trying to conceal contributions to a candidate in that race.
His resignation. On April 12, Mr. Benjamin was arrested and stepped down as lieutenant governor hours after federal prosecutors unsealed an indictment implicating him in a brazen scheme to enrich his political campaigns with illegal donations. The resignation could prove to be a serious political liability for Ms. Hochul.
Mr. Migdol was initially hesitant, according to the indictment of Mr. Benjamin. He said it would strain the network of donors he relied on for his charity, and he had no experience bundling donations. But after Mr. Benjamin helped secure the $50,000 grant, Mr. Migdol was seemingly on board.
In July 2019, just weeks after the senator secured grant money for his charity, Mr. Migdol hand delivered three checks to Mr. Benjamin’s Harlem office totaling $25,000 in the names of two relatives and a shell company he controlled. The checks were made out to Mr. Benjamin’s Senate campaign, prosecutors said. The developer made it clear they were from him and signed false campaign contribution forms as Mr. Benjamin looked on.
Mr. Migdol was also accused of violating campaign finance laws in gathering the smaller donations that would qualify for public matching funds in the comptroller race: $8 for every $1 in eligible contributions. He used the names and personal details of people who did not authorize the payments, including his 2-year-old grandson, to make contributions and reimbursed others who donated in their own names at his behest, according to his own indictment.
Prosecutors detailed only a handful of transactions in the Migdol indictment, but they have asked witnesses about more than 40 different Benjamin campaign donors. Many of the donors in question have ties to the Migdols and made contributions around a cluster of days in November 2019, January 2020 and July 2020 — times when prosecutors have publicly said Mr. Migdol helped steer bum contributions.
He also turned to his network of employees and business associates for help.
Several of the suspicious donations came within days of a July 6, 2020, email from Mr. Migdol to a small group of employees and several contractors with the subject line “Everyone I need $250 from NYC residents.” The email, which has not been previously reported, contained a form to donate to Mr. Benjamin’s campaign and a message from Mr. Migdol.
“Thank you I’ll call each of you today,” he wrote.
One of the recipients, a contractor named Amir Khan, donated $250 because he said he believed that he could not refuse the request from Mr. Migdol, a longtime client.
“I work for them eight, 10 years, and if someone told me, ‘Can you donate $250,’ I cannot say no,” he said in an interview. “This is the relationship.”
Copied on the message was Michael Murphy, one of Mr. Migdol’s close associates. Mr. Murphy, who goes by Mic, was once the frontman of the synth-pop duo The System, best known for its 1987 hit “Don’t Disturb This Groove.” More recently, he joined the board of Friends of Public School Harlem.
Mr. Murphy is not known to have been charged in the case, but campaign finance records list him as the person who collected contributions from nearly two dozen individuals for the campaign; they later drew scrutiny. The donors included Mr. Migdol’s grandson and multiple employees of a private security firm who told The Times that they worked or applied to be guards in homeless shelters at the time, but never knowingly gave to Mr. Benjamin.
Reached by email, Mr. Murphy said he had been instructed not to talk about the case by his lawyer, who declined to comment. But Mr. Murphy did add one observation, evidently about himself: “A very good man in a bad situation!”
The case is not the first time Mr. Migdol has intermingled his business, politics and charitable activity in a way that has drawn scrutiny.
When one of Mr. Migdol’s companies wanted to acquire a 215-unit building in the Bronx in 2006, the purchase required the City Council to approve the deal in order to keep the property’s affordable housing designation.
Tenants and a housing advocacy group opposed the application, accusing the developer at a Council hearing of using underhanded tactics to curry favor. They cited an open letter to tenants in which Mr. Migdol wrote that he was going to be the “future owner” of the building and added, “by way of introducing ourselves we would like to give holiday gifts.”
“The whole purpose was to buy the tenants,” said Denise Rosa, the president of the tenant association at the time.
Ms. Rosa and the advocacy group, Tenants and Neighbors, testified before the City Council that they had seen worrisome evidence of disrepair at some of Mr. Migdol’s other properties in Harlem. They also feared that Mr. Migdol would remove the building from an affordable housing program.
Ms. Rosa told the Council that Mr. Migdol was “used to breaking the rules whenever he wants just to get what he wants.” She later recalled in an interview how Mr. Migdol tried to win her over by inviting her to be his guest at a fund-raiser for Mrs. Clinton.
The City Council withdrew its approval of Mr. Migdol’s purchase of the building, and he filed a lawsuit that was eventually withdrawn.
More than a decade later, Mr. Migdol seemed to have advanced his skills in using charity and community outreach in a way that burnished his image.
In 2019, he decided to honor Hazel N. Dukes, the longtime head of the N.A.A.C.P. New York State Conference and an adviser to mayors, lawmakers and governors. He proposed erecting a plaque on a building he owned on Adam Clayton Powell Boulevard that houses a shelter.
Ms. Dukes was honored but also a bit puzzled when Mr. Migdol came to her home to pitch the idea.
“I didn’t know him at all,” Ms. Dukes recalled. “They came and visited me and told me about the work he was doing. He said that he had worked in Harlem, what he had done in housing and education, and he had named buildings after several African Americans that I knew.”
She said Mr. Migdol never asked for a favor in return, but she did recall attending his 70th birthday party.
At the plaque’s unveiling, the Migdols hosted a ceremony — later promoted on their business’s website — that featured David N. Dinkins, the city’s first Black mayor; Mr. Benjamin; and Mr. Espaillat, among other notable Harlemites. The plaque features Ms. Dukes’s likeness, but during the ceremony, it was dwarfed by a Migdol Organization banner hanging beside it.
Susan C. Beachy contributed research. Amy Julia Harris contributed reporting.
