16 Tax Assessors Arrested; Huge N.Y. Racket Alleged

Sixteen tax assessors were arrested Monday for allegedly taking part in a 35-year plot to accept bribes and cheat New York City out of hundreds of millions of dollars in property tax revenue, officials said.

An indictment accused the assessors of accepting at least $10 million in bribes and expensive meals to alter the assessed values of more than 500 properties worth a total of $8 billion.

Two alleged bribe payers--both former assessors--were also accused in the plot that led to an indictment accusing the defendants of racketeering, bribery and fraud. The indictment seeks the forfeiture of the lost revenue and the $10 million allegedly obtained through bribes.

“These folks sold their office and sold out the people of New York,” U.S. Atty. James Comey said. “In doing so, they undermined a bedrock of this city’s finances--a fair and honest tax assessment system.”

Federal and city officials said the scheme could be the largest theft in city history. Almost half of the 36-member Manhattan tax assessor staff was implicated.

Since 1997, the scheme has cost the city about $160 million in lost tax revenue, Comey said.

Twenty percent of the city’s budget comes from property tax revenue, and the loss of taxes probably cheated the public of new schools and better roads and services, FBI Assistant Director Barry Mawn said.

“Everybody was getting a piece of the pie. They were protecting one another,” Mawn said.