Frank Carone, former chief of staff to ex-NYC Mayor Eric Adams, arrested in corruption investigation
The FBI on Wednesday morning arrested Frank Carone, the former chief of staff to former Mayor Eric Adams, at his Manhattan home, and three others in connection to a bribery scheme related to emergency migrant shelters.
Frank Carone, 56; his brother Anthony Carone, 54; Queens hotel owner Yan Po Zhu, 51, and Crystal Chen, 39, each pled not guilty to bribery, money laundering and fraud charges at an arraignment at Brooklyn federal court in the afternoon. They were each released on bond with special conditions.
Allegations against Frank Carone
According to a 13-point indictment newly unsealed by the office of the U.S. Attorney for the Eastern District of New York, the Carones, who are both attorneys, and Zhu "devised and executed a scheme to exploit the city's migrant crisis for profit."
As the Adams administration was converting city hotels into migrant shelters from 2022 into 2023 with $1.8 billion in federal grants, prosecutors allege Frank Carone, who served as chief of staff from January 2022 through December of that year, accepted a series of bribe payments and in exchange "agreed to steer a multimillion-dollar emergency shelter contract" to Zhu's Long Island City hotel, in which Chen served as manager.
Prosecutors say that hotel, Microtel, had previously been rejected as a suitable location to run a shelter, with Department of Homeless Services staff saying it was "smaller than the other two" hotels proposed. However, Frank Carone, then chief of staff to the mayor, is alleged to have interjected and received $120,000 for doing so.
The hotel received a contract of nearly $7 million.
According to the indictment, the bribe payments were hidden and sent to a bank account in the name of Anthony Carone's law firm.
Prosecutors say Anthony Carone sought additional payments.
Department of Investigation Commissioner Nadia I. Shihata issued a statement that said, in part, "All four defendants used the plight of migrants for their own profit, resulting in the inefficient use and approval of a shelter location that could house fewer people than more appropriate locations."
Frank Carone's attorney refutes the allegations
Arthur Aidala, Frank Carone's attorney, issued a statement early Wednesday afternoon.
"Today's indictment is a sad day for our criminal justice system. It epitomizes the Government first finding a target and then spending three years and enormous taxpayer resources to find a crime," Aidala said.
"After intense investigations over many years, all the Government was able to come up with was this weak indictment based on purely circumstantial evidence that's not worth the paper upon which it's printed. Everyone who knows the Carone brothers know they do things the right way; that's why it took over three years for them to come up with something that they could put on paper. We look forward to appearing before a jury and obtaining a swift acquittal," he added.
A spokesperson for former Mayor Adams said, in part, "Frank Carone has dedicated decades of his life to public service, the legal profession, and helping countless individuals, businesses, and charitable organizations throughout New York. This is an ongoing legal matter and my prayers are with his family."
Carone's arrest comes on the same day that a joint investigation between the NYPD and FBI resulted in the raids of three current and former NYPD officials, all ex-associates of Adams.
