Southbridge director charged in fraud case

Wolfson is charged with illegally selling her Southbridge apartment for $150,000 in a conspiracy with another Southbridge resident, Mark Marcucilli, D.H.C.R. assistant director of housing management and Wolfson’s superior at the agency. He was charged the week before in a related, but separate federal case.

Wolfson and Marcucilli were released on their own recognizance pending grand jury action. Neither Wolfson’s lawyer, Frank Loverro, nor Marcucilli’s lawyer, Jesse Barab, returned Downtown Express phone calls seeking comment. On Dec. 30, Wolfson resigned from the 15-member Southbridge co-op board of directors.

John Ost, a member of the board from 2001-2004, said he had suspicions while he served on the board, adding he found “weird things. Apartment lists were manipulated and apartments were assigned to people who should not have been eligible,” Ost said, without naming who specifically was to blame.

Wolfson, assistant housing management representative at D.H.C.R., and Marcucilli, have been assigned duties other than housing management at the agency’s Beaver St. office pending the outcomes of their cases, according to Jennifer Farina, spokesperson for the agency.

D.H.C.R. supervises Southbridge Towers and other Mitchell-Lama housing complexes and is responsible for reviewing residents’ annual income affidavits and enforcing rules concerning application, succession and prohibitions on subletting. The charges allege that the pair made false statements to the agency.

The case against Marcucilli includes a charge that he was the go-between in the illegal sale of Wolfson’s Southbridge apartment, 17A, at 77 Fulton St. for $150,000 and two counts of defrauding the Lower Manhattan Development Corporation’s rent subsidy program.

The Wolfson case charges her with falsely representing to Southbridge and to D.H.C.R. that she lived with her boyfriend, the person to whom she intended to transfer the apartment. But that person (identified in the complaint only as Witness #1) told a state Office of Inspector General attorney that he was not Wolfson’s boyfriend and admitted he did not live in apartment 17A, according to the complaint. Witness #1 actually lived in a 10th-floor apartment on an illegal sublet arranged by Marcucilli, who was identified in the Wolfson complaint as Co-Conspirator #1, according to the complaint.

Wolfson is also charged with obtaining another, larger Southbridge apartment, a two-bedroom unit, by falsely stating that her nephew lived with her 82-year-old mother in apartment 17C, where Wolfson later moved.

But the complaint goes on to say that Wolfson’s brother (the father of her nephew) told the state attorney that his son never lived at the apartment and had signed documents for Wolfson because he thought he might move into 17C after Wolfson’s mother died.

The complaints against Wolfson and Marcucilli were both drafted by Arlene Osterer, associate counsel for the New York State Office of Inspector General, which investigates violations for all state government agencies including D.H.C.R.

The federal Department of Housing and Urban Development (HUD), the U.S. Postal Service, and the U.S. Attorney’s office in Manhattan also investigated the case, which was filed in federal court because mail and telephone lines were involved in the alleged fraud which occurred over a five year period from 2000 to 2005, the complaints say.

Marcucilli, named as a co-conspirator in all the counts against Wolfson, was also charged with stealing funds “in excess of $1,000” from the L.M.D.C., which made grants to Downtown residents affected by the Sept. 11, 2001 World Trade Center attack. HUD is the federal agency that funds the post-9/11 development corporation.

Marcucilli is charged with illegally obtaining an apartment at Southbridge by falsely stating that his father lived with him in the complex and then securing the L.M.D.C. grant for his father even though his father lived in Yonkers.

The complaint also charges Marcucilli with helping a friend illegally obtain a residential grant from L.M.D.C. by falsely representing that the friend lived at Southbridge. In fact, the friend had illegally sublet his Southbridge apartment and was living elsewhere on Sept. 11, 2001, the compliant says.

For the past several years, residents of Southbridge, a 1,651-unit Mitchell-Lama co-op, have been deeply divided over whether to buy out of the state-supervised, middle-income program and allow residents to sell their apartments at market rate.

Many of the current board of directors, including Wolfson, have been against privatization. Wolfson’s seat on the board, which she vacated on Dec. 30, will be filled at the May 2006 board election when six members rather than the usual five will be elected. Paul Viggiano, current board president, named board member, Hui He, to replace Wolfson as treasurer. Viggiano declined to comment on the two fraud cases.

At the end of October, Southbridge co-operators voted 740 to 353 to go ahead with a $25,000 study of the effects of taking the co-op private. The decisive vote prompted the co-op board to back off an immediate decision to apply for a J-51 tax abatement that would have locked the co-op into the Mitchell-Lama program and prevented privatization for 20 years.

Jared Brown, president of SouthBridge Rights, a group supporting privatization, said on its Web site that the Wolfson and Marcucilli charges are “like a breath of fresh air,” and contended that the cases “begin to explain why some members of the board have been so opposed” to privatization.

As a state-supervised Mitchell-Lama, a representative of D.H.C.R. has the non-voting 16th seat on the board. Ost, the former board member, said Marcucilli was the D.H.C.R. representative on the Southbridge board about five years ago.

Albert@DowntownExpress.com

WWW Downtown Express