Norman Seabrook, president of Correction Officers' Benevolent Association Inc., New York, and Murray Huberfeld, founder of hedge fund Platinum Partners, were named in federal corruption charges on Wednesday, court papers said.
They were charged with one count of honest services fraud and one count of conspiracy to commit honest services wire fraud. According to U.S. District Court in New York court documents provided by a spokesman for U.S. Attorney Preet Bharara, Mr. Seabrook accepted a kickback of $60,000 as a result of his approving a $20 million direct hedge fund investment in Platinum Partners — $15 million of which came from the COBA Annuity Fund, the union's pension fund, and $5 million from the union's general fund.
The COBA Annuity Fund had $81 million in assets as of the end of 2013, according to the court papers, about $72 million of which was invested through three investment managers, allocated primarily to stocks, bonds and a real estate trust fund.
It was during 2014 that Mr. Seabrook made the investments, beginning with a $10 million initial investment that March.
A phone call to the union seeking comment was referred to spokesman John Gallagher, who could not be immediately reached.