The Brooklyn Supreme Court Justice indicted by a Federal grand jury for allegedly covering up the theft of millions of dollars from the Municipal Credit Union was actually a “fugitive for a day” and her defense counsel might be “implicated” in her crimes, prosecutors told Judge Lewis A. Kaplan at a Nov. 4 hearing.
On Oct.11, FBI agents arrested Sylvia G. Ash at La Guardia Airport, on her way back from Miami. She was charged with obstructing the criminal probe of Kam Wong, the former CEO of the MCU, who was sentenced to 5½ years in prison last June for the theft of almost $10 million from the nonprofit that serves civil servants and their families.
More Charges for Ash?
The government’s latest assertions came at an unusually contentious initial appearance and pre-trial conference in lower Manhattan at which Justice Ash, represented by Roger Archibald, pleaded not guilty.
A May 18 trial date was set, but Federal prosecutors told Judge Kaplan it was possible they would be filing a superseding indictment because of the scale of the “sprawling investigation” not just into Ms. Ash’s MCU-related actions but “her other behavior.”
Early in the proceeding, Assistant U.S. Attorney Daniel Richenthal suggested to Judge Kaplan that her lawyer, Mr. Archibald, was “implicated” in Ms. Ash’s criminal conduct “either knowingly or unknowingly” as a first-hand “witness to multiple actions” involving what the government charges was an elaborate criminal conspiracy.
“It is advisable for Ms. Ash to consult independent counsel,” Mr. Richenthal said.
Mr. Archibald responded that he had just learned of the government’s concerns the previous weekend before the Monday court appearance and that his client subsequently retained G. Michael Bellinger as an independent counsel to help her “navigate these perilous waters.”
The defense counsel said that it was his understanding of the law that if his client felt his disqualification “was a hardship,” she could waive the conflict-of-interest issues, a move that prosecutors countered would be prohibited “under settled precedent in Federal court.”
Mr. Archibald’s status as defense counsel was not resolved by the end of the hearing.
But in a move that appeared to catch both the Judge and prosecutors by surprise, Mr. Archibald asked Mr. Kaplan to lift Ms. Ash’s $500,000 bail, secured against her home and the condition she wear a GPS ankle monitor.
“My client is a Supreme Court judge….this is not a crime of violence…she has all the indicia that she will show up,” he contended. He added that the government had allowed Justice Ash take a trip “all the way across the country” to California so she could see her son graduate from the Fire Academy in Riverside.
Assistant U.S. Attorney Eli Mark sprang to his feet to contest the motion. He told the court that on Oct. 10, when the FBI executed a search warrant on Ms. Ash’s home “she failed to surrender and was a fugitive for a day” while Mr. Archibald appeared to misdirect the government about her whereabouts by telling FBI agents she “was not in country or on her way to South Africa” when she was actually in Miami.
Evasive About Arrival
“Defense counsel would not even tell us what flight she was taking back” after the government told her lawyer they had discovered her location and would arrest her where she was. “The government only consented to the California trip because of those bail conditions,” Mr. Mark said.
Judge Kaplan said he “was blindsided” by the bail application and didn’t rule on it, pending a review of the transcript of the Magistrate’s proceedings at which the bail package was finalized.
Neither Ms. Ash nor her legal team would comment after the proceedings.
She is on a paid leave from her $210,000-a-year job as the presiding judge of Brooklyn Supreme Court Commerical Division.
Ms. Ash is also charged with having the MCU pay her cell-phone bills, and pocketing tens of thousands of dollars in travel expenses. Prosecutors allege that the Brooklyn Judge violated the MCU’s requirement that board members be volunteers and the state judiciary’s code of conduct requiring disclosure of her extra-judicial activities and any income they might generate.
She was on the MCU’s board from May 2008 until Aug. 15, 2016. She was also a trustee of the MCU pension plan, a post she resigned from on Oct. 31, 2016. From May 2015 until her resignation, she served as the chair of the MCU board.
Prosecutors charge that from 2012 through 2016 Ms. Ash “received annually tens of thousands of dollars in reimbursements and other benefits from the credit union, including airfare, hotels, food and entertainment expense for her and a guest to attend conferences both domestically and abroad, as well as payment for phone and cable bills, and electronic devices.”
Also arrested on Oct. 11 was Joseph Guagliardo, a retired NYPD officer who joined the MCU Supervisory Committee in 1993 and held the post until he was removed by state regulators on May 24, 2018.
“From at least in or about 2009, up to and including at least in or about May 2018,” Mr. Guagliardo “and others known and unknown willfully and knowingly” conspired to embezzle from the MCU, prosecutors charged. The government said he stole in excess of a half-million dollars through a security company he created for that purpose and a non-profit organization he founded in 1975 to promote Italian culture.
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