Seabrook a Prisoner Of His Own Meteoric Rise (free article)

When Assistant U.S. Attorney Martin Bell began his argument Feb. 8 for why Norman Seabrook should be given 63 months in prison—the maximum called for under the complex Federal sentencing guidelines—he focused on the Ferragamo bag in which Jona Rechnitz testified he had stuffed $60,000 in bribe money that he handed to Mr. Seabrook in December 2014.

It was intended as a kickback for the then-president of the Correction Officers Benevolent Association having invested $20 million in union money with Platinum Partners, a hedge fund whose managing partner, Murray Huberfeld, was an old friend of Mr. Rechnitz’s father, a wealthy California developer. The witness said he chose that bag because he knew Mr. Seabrook was fond of the designer and he wanted to do something to make up for the fact that the payoff was $40,000 short of the minimum he had promised him when he induced the union leader to make COBA the first municipal union to invest through a hedge fund.

It was symptomatic of Mr. Rechnitz’s cluelessness, or perhaps the degree to which he had persuaded Mr. Seabrook to buy his promises of riches to come, that he could believe that packing the money in an $820 designer bag would serve as consolation for the payment coming up so light.

Souvenir of a Crime, Prominently Displayed

Mr. Bell reminded U.S. District Judge Alvin K. Hellerstein that when FBI Agents came to arrest Mr. Seabrook 2 ½ years later, the Ferragamo bag was hanging visibly near his front door, calling it not only a symbol of his taste for high living “but an instrument” of his crime.

He argued that it also symbolized a betrayal of the trust union members had placed in him from the time when they first elected him COBA president in 1995.

“Norman Seabrook felt that for being a good and particularly effective leader,” he deserved more than his lofty position and the reported $300,000 salary that came with it, Mr. Bell told the Judge, the dozen reporters seated in the jury box for the sentencing, and the ex-union head’s supporters packing the spectator section. He believed that “he was bigger than the people he represented, who had invested their trust in him. He felt that he was owed.”

When Mr. Seabrook’s turn came to speak, after three correction officers who had past dealings with him described his misdeeds or derelictions, he turned almost immediately to the Ferragamo bag.

Repeating the explanation his attorney, Paul Shechtman, had given over two trials—the first ended with a hung jury in November 2017 owing to the credibility issues raised regarding Mr. Rechnitz, before a conviction last August—Mr. Seabrook stated, “That Ferragamo bag was a gift, with cigars [inside it.] And I don’t throw out gifts.”

He expressed no remorse; by his account he had not committed the crime that placed him before Judge Hellerstein. He spoke of having “lost the one job that I dedicated myself to for 30 years,” spanning his time as a Correction Officer before he led an insurgent slate to victory 24 years ago.

He said COBA’s members were “the ones I care about the most,” adding that before he became president, they “were considered second-class citizens and never got the recognition they deserved.”

Mr. Seabrook reeled off his accomplishments, including passage of a bill giving them a Variable Supplements Fund benefit previously available only to cops and firefighters, and laws entitling them to pensions equaling three-quarters of final salary if they developed heart disease or suffered a disabling injury on the job. He cited the creation of a widows and children’s fund, and said of the union’s annuity fund, “we have paid out over $100 million” in benefits to members.

Of course, that fund was also one of the primary crime scenes, having accounted for $15 million of the $20-million investment the union placed with Platinum Partners on Mr. Seabrook’s recommendation. (The other $5 million, which was most of its operating account at the time, he invested without consulting fellow board members.)

His choice of words regarding those investments sounded more like a lawyer’s than a union leader’s: “There is no evidence that I ever intended any union member to lose a dime from any of the investments.”

In other words, he couldn’t say that their best interests were the one thing guiding his decision to so heavily invest with the kind of fund where both risk and reward could be particularly great; just that when he took the leap, he didn’t anticipate things going so bad that Platinum Partners would wind up filing for bankruptcy protection less than three years later.

Irrational Optimism

Mr. Shechtman, in the course of flaying Mr. Rechnitz’s credibility to rags, exposed his boasts about his skills as a gambler as highly selective, noting that while the witness portrayed himself as an occasional bettor with remarkable luck, in reality he bet hundreds of thousands of dollars in the casinos in Las Vegas, with large profits in one year and larger losses in another. In trying to explain his client’s numerous withdrawals of large sums from his bank account and the tens of thousands of dollars in cash that investigators found in his basement on the day of his arrest, he said Mr. Seabrook also gambled heavily.

But one characteristic some big gamblers share is the conviction at times that the odds are tilted in their favor so strongly that they lose sight of the risks they are taking. In Mr. Seabrook’s case, that extended beyond the crap tables in Atlantic City to the way that he shoveled money into Platinum Partners, doubling up the initial $10-million investment within a six-month period without any reliable evidence that he had found the mother lode.

One of the key arguments between prosecution and defense lawyers during sentencing was whether the large loss COBA suffered from the investments—even after Mr. Huberfeld reached an agreement with the union recently to give it $7 million to settle a lawsuit, it was still $12 million in the hole while hoping to recoup more from a lawsuit against other hedge-fund partners—should be a factor in how much time Mr. Seabrook was given.

Mr. Shechtman argued that it shouldn’t be, because his client had no inkling of the problems Platinum Partners was experiencing by the time in December 2013 that Mr. Rechnitz, during a trip to the Dominican Republic with Mr. Seabrook, pitched the investment as a response to the union leader’s alleged declaration that “It’s time Norman Seabrook got paid.”

After Judge Hellerstein essentially split the difference between the two sides and ordered Mr. Seabrook to serve 58 months in Federal prison, the debate shifted to whether he should be required to make restitution to COBA for some of its losses.

Didn’t Envision the Worst

Mr. Shechtman held his position, saying that based on what his client had been told by COBA’s investment adviser, notwithstanding the risks inherent in hedge funds, “Mr. Seabrook thought he was investing in a five-star fund…to say that he thought it was gonna go bad, I don’t think that’s true.”

Judge Hellerstein interjected, “If he had not been bribed, that would have been a good argument.” He was suggesting that the visions of large sums conjured up by Mr. Rechnitz that would go directly to Mr. Seabrook if the investment did well led him not to ask questions that might dissuade him from committing so much union money to Platinum Partners.

Mr. Shechtman, who moments earlier described his client as “someone who does not have a financial background,” said Mr. Seabrook, the product of a single-parent home in The Bronx whose street smarts had been sharpened by both his time as a Correction Officer and his experience dealing with the most-powerful government officials in both the state and the city, had been snookered by a spoiled kid from Beverly Hills who spun tall tales of owning a yacht and two of the most-valuable buildings in the Wall Street area.

“Eyes blind or wide open, that’s the practical reality,” he told the Judge. “He believed the same person that the jury believed,” referring to Mr. Rechnitz. “Who told him that this was gold.”

Actually, several of the jurors in the second trial expressed skepticism about Mr. Rechnitz’s credibility, which had been the single-biggest factor in the earlier jury being unable to reach a unanimous verdict. The prosecution during the second trial reined in Mr. Rechnitz enough that he didn’t engage in pointless debates during cross-examination about whether he hadn’t realized that blackface was insulting to African-Americans when he wore it for a 2013 Purim party, and whether allowing someone he described as a close friend to be cheated out of more than $4 million in two Ponzi schemes meant he defrauded him.

Believed Board Members

During the first trial, four days of deliberations passed—with jurors twice telling trial judge Andrew L. Carter Jr. in that case that they were hopelessly deadlocked—before they thought to request the transcript concerning testimony by two COBA board members: Mr. Seabrook’s successor as president, Elias Husamudeen, and Treasurer Mike Maiello. The reduction in embarrassing moments for Mr. Rechnitz in the second trial allowed that jury to focus more intently on what the union board members said and the degree to which Mr. Seabrook had been evasive with them, both in information he withheld about the potential risks, and the $5-million investment in Platinum Partners that they didn’t know about until the union’s bank contacted Mr. Maiello to inform him his signature was needed to finalize the transaction.

That testimony was harder to discredit, and Mr. Shechtman seemed to grasp that his best hope of walking his client out of the courtroom each time was to not risk going after the union witnesses too hard and being unable to puncture their accounts.

During the first trial, his stellar work on behalf of Mr. Seabrook arguably reached its peak when he crafted an alternative theory for a key piece of prosecution evidence: a videotape of Mr. Rechnitz walking into his Midtown offices with the Ferragamo bag slung across his shoulder, then exiting a short time later carrying the bag in his hand, hanging lower than would be expected if it was stuffed with $60,000 in $100 bills.

Reminding the jurors that Mr. Rechnitz testified that when he met Mr. Seabrook later that day and handed him the bag, the union leader put it “at his feet by the driver’s side” of his vehicle and left it there when they went to dinner, Mr. Shechtman asked whether, if the bag really held a large amount of cash, his client wouldn’t have placed it in the glove compartment or the trunk. The reason he hadn’t, he contended, was because the bag contained cigars rather than $100 bills, reminding them that Mr. Rechnitz had testified earlier in the trial about on one occasion giving Mr. Seabrook cigars in a bag.

The attorney told the jurors that Mr. Huberfeld, who during the first trial was sitting at the defense table with Mr. Seabrook, had actually given Mr. Rechnitz the $60,000 as a finder’s fee for steering COBA’s business to his fund, and received an invoice falsely claiming that the money was reimbursement for Knicks’ tickets because Mr. Rechnitz didn’t want to report the payment and then be liable for taxes on it.

Required Overlooking Motive

The entire tale sounded sufficiently plausible to create reasonable doubt in jurors’ minds that Mr. Seabrook had been bribed. But believing Mr. Shechtman’s theory required that they forget the obvious question at the heart of the prosecutors’ case: why would Mr. Seabrook have gone to such lengths to invest large amounts of his union’s money—and deceive members of his board not only by not informing them of the second investment but not sharing with them information about the pluses and minuses of investing with a hedge fund that had been laid out for him in letters from both COBA’s counsel and its outside investment adviser.

There was one possible explanation besides the obvious one that he was being paid off by Mr. Rechnitz and Mr. Huberfeld and would not tell his board members anything that might blow up their secret deal. And that was that Mr. Seabrook became so intoxicated with his own power that he believed he could do whatever he wanted and not be accountable to either his board members or his rank and file.

That doesn’t seem particularly rational. Then again, neither does a man making $300,000 a year in a job which gave him a disproportionate role in the city-jail system and the larger political world risking everything he had going for him for $60,000. The $100,000 to $150,000 that Mr. Rechnitz originally promised he could reap on an annual basis might seem another story, although Mr. Seabrook generally tended to deal in the concrete rather than pie in the sky.

Then again, years of making the improbable happen may have fueled the kind of arrogance it would take to get involved in this type of scheme and believe it wouldn’t unravel.

Mr. Shechtman used a tribute to Mr. Seabrook from one of his seven siblings to illustrate how far he had come. His younger brother credited Norman for raising him well enough that he eventually got a doctorate and “became a homeowner.”

The coupling of those seemingly disparate accomplishments made perfect sense, Mr. Shechtman told Judge Hellerstein, in the context of their humble beginnings, which meant that “owning your own home is as monumental as becoming a PhD.”

Mr. Seabrook’s early career in the Correction Department was helped along when he attracted the attention of then-Commissioner Richard Koehler, who tapped Mr. Seabrook to become his driver (and eventually became the union’s general counsel). By the early 1990s he was a vocal critic of COBA’s leadership, and in 1995 he unseated President Stanley Israel in a landslide despite there being four other candidates who could have split the anti-incumbent vote.

Aligned With GOP Powers

COBA’s membership by then was 75 percent black and Latino, but the nature of Correction Officers’ jobs makes them more likely to support Republican elected officials, which became a key to Mr. Seabrook’s greatest accomplishment for his members: Variable Supplements Fund legislation.

In 1998, he gave his union’s strong support to Gov. George Pataki’s re-election, while also cultivating the then-Majority Leader of the State Senate, Joe Bruno. Mr. Pataki’s Democratic opponent in the election had been City Council Speaker Peter Vallone, but Mr. Seabrook, who needed a home-rule message from the Council on legislation covering his members, convinced the law-and-order Democrat to push the VSF bill through the Council in return for COBA’s backing for his planned 2001 mayoral run.

That combination of support enabled the union to get the VSF bill sent to Albany and then signed into law by Mr. Pataki in 2000 despite the objections of Mayor Rudy Giuliani and several city unions.

Police and firefighters had gotten the VSF—which was derived from their pension funds’ stock profits—in 1970 in return for allowing those funds to make investments in the stock market. Where those employees had their own pension funds, COBA members comprised a relatively small percentage of the pensioners belonging to the New York City Employees’ Retirement System, which had gotten another benefit during that era for allowing that fund to make stock investments.

This meant that Mr. Seabrook had none of the leverage that the police and fire unions had; instead he relied on political IOUs and, in Mr. Vallone’s case, a promissory note, to gain the VSF for his members. Some city officials described the bill as dubious public policy but a career-making coup for the COBA president.

Mr. Vallone’s losing the 2001 Democratic primary turned out to have a happy ending for Mr. Seabrook as well. Mark Green, who gained the party’s nomination after a runoff, vowed to impose significant cuts in the jail system, making him unpalatable to Mr. Seabrook and prompting him to be the first union leader—only one more would follow—to endorse Republican Michael Bloomberg, who was trailing badly in the polls at the time.

His electoral magic continued over the next two presidential elections: he endorsed President George W. Bush’s re-election in 2004, then became the first union leader outside Illinois to back Barack Obama early in the 2008 election cycle.

Drunk on His Own Power?

But Mr. Seabrook’s growing political clout gave him a sense of invulnerability that set him up for a tumble. One of the “victims” who testified at his sentencing hearing, retired Deputy Warden Eric Deravin, said Mr. Seabrook once got him transferred for standing up to him; he wasn’t the only mid-level manager in the jail system to get big-footed in situations in which the department’s leadership disregarded chain of command because it feared antagonizing the union leader.

“He stole the heart and soul not only of his members but of the entire Department of Correction,” Mr. Deravin told Judge Hellerstein.

And in 2013, a year he would cap off by setting in motion the scheme that, assuming his appeal doesn’t succeed, will send him to prison for 58 months sometime next year, Mr. Seabrook arranged a job action that prevented a Correction Department bus carrying inmates—including two who were scheduled to testify about alleged brutality inflicted by COs—from leaving Rikers Island. Mayor Bloomberg opted not to bring Taylor Law charges against him, but that was the kind of high-handed behavior by Mr. Seabrook that attracted the attention of then-U.S. Attorney Preet Bharara, who came to view the union leader’s power as a hindrance to bringing reforms to the jail system.

Then Mr. Rechnitz, in trouble with the U.S. Attorney’s Office for multiple illegal schemes in which he was involved, asked what prosecutors might do for him in return for recounting an evening in the Dominican Republic in which heavy drinking led to the purported proclamation that it was “time that Norman Seabrook got paid.”

‘I’ll Emerge Stronger, Judge’

More than five years later, Mr. Seabrook stood before Judge Hellerstein scoffing at Mr. Bell’s claim that he had betrayed his members and telling the Judge that whatever his sentence, “I will emerge stronger and better. I will find a way to continue to fight for working men and women.”

The Judge spoke of the paradox of a man with “dignity and inner strength” having fallen victim to his own “hubris,” then added, “I do not count against him that he has not accepted responsibility or expressed contrition” because of Mr. Seabrook’s plan to appeal the conviction.

There was a message implicit in Mr. Seabrook, after leaving the courthouse, being photographed with a big smile that never left his face: even if his appeal failed, he was unlikely to let the world see whatever remorse he harbors for the hard fall he’s taken.