Sergio Benitez, a real estate developer of affordable housing projects for the New York City Department of Housing Preservation and Development, was sentenced to a 22-month prison term for wire fraud.
As part of his sentencing, Benitez has been banned for three years from applying for any other city or governmental housing contacts. He was also ordered to pay $228,200 in restitution to New York City and fined $10,000.
According to government filings and public records, Benitez defrauded the New York City Department of Housing Preservation and Development by demanding kickbacks from a construction contractor in return for hiring him as the general contractor on the Cooper Decatur Cluster affordable housing development in Brooklyn.
From 2006 until Benitez’s arrest in October 2011, the contractor paid 2% of the funds he received from HPD to Benitez, which totaled $228,200 in kickbacks. In order to cover the costs of these kickbacks, the contractor inflated his invoices to HPD by a similar amount, the Department of Justice said.
To disguise the kickbacks, Benitez issued bogus invoices to the contractor from his company All Boro Painting & Repairs. At the same time, the defendant was featured as a model real estate developer by HPD in its New Housing Marketplace Plan issued in early 2011 where Benitez said, “I’m originally from Brooklyn, and I see my work as a way of giving back.”
“Sergio Benitez claimed that he was giving back’ to Brooklyn, but in reality, all he gave the people of the city of New York was a hefty bill for his own corruption. In taking hundreds of thousands of dollars in kickbacks, Benitez stole from the very community he had pledged to serve, by diverting funds meant for affordable housing construction into his own pockets,” said Loretta Lynch, U.S. attorney for the Eastern District of New York. “Today’s sentence shows that even the most influential real estate developers will be brought to justice if they steal public funds for corrupt personal gain.”
As part of the
