Correction union boss, hedge fund founder face fraud charges

NEW YORK (AP) — The longtime head of the nation's largest municipal jail guard union was paid tens of thousands of dollars in cash, delivered in a Ferragamo handbag, in exchange for steering $20 million in union money to a hedge fund, according to a criminal complaint.

Norman Seabrook, the brash and defiant president of the 9,000-member New York City Correction Officers' Benevolent Association, and Murray Huberfeld, the hedge fund's founder, were arrested by FBI agents on conspiracy and fraud charges Wednesday.

The arrests are the latest development in a series of overlapping public corruption investigations coordinated by U.S. Attorney Preet Bharara, with other targets including high-ranking New York Police Department officials and political fundraising activities of people with ties to New York's mayor.

[...] two people with direct knowledge of the case identified him as Jona Rechnitz, a businessman who has contributed to Democratic Mayor Bill de Blasio's campaigns, was friendly with top police officials and has been captured on FBI wiretaps in a related gifts-for-favors probe.

[...] according to the complaint, he was desperate to gain personally from his work investing union funds, complaining drunkenly in a hotel room during a trip with Rechnitz that he "worked hard to invest COBA's money and did not get anything personally from it," adding "it was time that 'Norman Seabrook got paid.'"