You are about to read tales of greed and corruption, costly incompetence and outright thievery. There is even a little sex and gambling thrown into the mix. Stories from television soap operas? No, these are the days of our lives in the New York City real estate industry, where a series of indictments leveled at property managers, contractors and vendors last summer have rocked the professional community again. And for every name that you may have read in the papers, several more are under investigation. This is what it sometimes looks like when your hired hands have their fingers in the till.
The most notorious of the current cases is Marvin Gold, president of Marvin Gold Management Co., Inc. in Brooklyn. According to Indictment #4706-99 from the Manhattan District Attorney’s office, Gold received over $1.5 million in kickbacks from the vendors and contractors who served the buildings he managed. In June he was indicted on 14 counts including: three counts of grand larceny and five counts of commercial bribe receiving. Along with Gold, the company vice president, Jeffrey Gold (no relation) was indicted on 19 counts and accused of receiving over $200,000. Eight of Gold’s property managers and one board member of a Gold-managed building were indicted for taking almost $1.3 million in kickbacks from vendors and contractors.
How did such wide-scale corruption and vast sums of money go unnoticed by the buildings in Gold’s stable? How did this firm and all of the others committ these crimes? Carmen Lee Shue was a board member for six years at an Upper West Side condominium, managed by an indicted management firm. According to Shue, "I was a gadfly, challenging people, questioning everything." It is only because she no longer lives there, that Shue feels safe to tell the story. "If I didn’t leave," she says, "someone would have killed me."
"There were problems with the building from the beginning," offers Shue. "I was not yet on the board, when a new board member spotted inconsistencies in the bills. She showed them to me." Shue then went on to compare the prices that the property managers were supposedly paying versus quotes from several other vendors. "In every case we were paying the highest dollar amount," Shue exclaims. "Why were we paying $36 for a towel rack, when I could purchase one at the hardware store next door for $4.99?"