At age 101, the billionaire Manhattan real estate mogul Leonard Litwin is at the center of recent corruption scandals that have rocked New York’s political establishment. The New York Times has named Litwin and his firm, Glenwood Management, as “Developer 1” in the indictment brought by US Attorney Preet Bharara. That indictment has led to the ouster of Assembly Speaker Sheldon Silver last month. Silver is now facing federal corruption charges.
Glenwood Management owns 26 buildings comprising 8,700 apartments. The firm is one of two developers that are cited but not named in the US Attorney’s compliant, alleged to have paid a curiously small law firm, Goldberg & Iryami, nearly $700,000 to perform some of their property tax work. The complaint alleges that in 2000, Silver suggested that Litwin hire the firm, which was founded by Jay Arthur Goldberg, a former State Assembly staffer and Silver’s counsel. Goldberg & Iryami then paid hundreds of thousands of dollars disguised as “referral fees” to Silver, the US Attorney alleges.
Litwin made over $10 million in political contributions since 2005. In addition to contributions, Litwin spent heavily on lobbyists as well. In 2014 alone he spent $900,000 on eight different firms to lobby state officials. The Times reports that one-third of Litwin’s buildings receive tax breaks and special financing for setting aside 20% of the buildings’ units for affordable housing.
Litwin has donated heavily to Governor Andrew Cuomo, Mayor Bill de Blasio, and Attorney General Eric Schneiderman. The Attorney General has been lambasted for not pursing public corruption allegations against public officials, despite frequent promises do so while he ran for reelection. The Mayor has been criticized for appointing Litwin to the 2016 Democratic National Convention “Host Committee” last week.
Litwin contributed $1 million to Governor Cuomo’s reelection effort, and another $500,000 to the New York Democratic Party, The International Business News reports. The Cuomo-run New York Housing Finance Agency later approved a $290 million low interest loan in 2014 to finance new luxury apartment building in Midtown Manhattan. At the time the loan was being considered, NYHFA was headed by Bill Mulrow, a registered lobbyist for the Blackstone group, a massive private equity fund. Mulrow was just recently appointed to be Cuomo’s new Chief of Staff.
Litwin’s extensive use of what is known as the “Section 421a Tax Credit” is becoming a focal point of the federal investigation, political operatives have rumored. It has been widely reported that the Governor is “distraught with fear” over the looming scandal, which is expected to badly tarnish his national image, with the prospect of a prison sentence.
In 2014, when the Moreland Commission began investigating the relationship between the real estate industry and public officials, Governor Cuomo quickly shutdown the Commission. At the time, his former Chief of Staff Larry Schwartz called the Commissioners to stop them from subpoenaing the Real Estate Board of New York, an industry funded lobbying group. Litwin is the “Lifetime Honorary Chairman” of that organization.
Litwin’s pervasive involvement in the funding and influencing of the State’s Democrat party establishment — and his central role in the federal probe of former Assembly Speaker Sheldon Silver — threatens to take down the entire New York political establishment.
It is rumored that Attorney General Schneiderman’s office is currently under investigation by the US Attorney’s office.