2010-02-26 / Top Stories

Meeks, Smith Federal Investigations Grow

By Howard Schwach

The federal investigation into the Aqueduct Racino decision has spread in several directions, officials say, putting Congressman Gregory Meeks and State Senator Malcolm Smith, both of whom represent Rockaway, in the glare of revelations about their nonprofit and fundraising activities.

Published reports in all of the daily newspapers say that The New Direction Local Development group, founded by Meeks and Smith in 2000, received at least $56,000 in taxpayer funds since 2001, most of them in earmarks from the two legislators. Tax returns and other official reports show that most of those funds were used for meals, entertainment, and to pay tax fines to the IRS.

In addition, in 2004 Meeks and Smith helped arrange for a developer who wanted to build a huge cargo facility on Rockaway Turnpike across from JFK Airport to donate $250,000 in community development funds to the neighborhoods impacted by the airport.

That money was steered to New Direction, reportedly by Smith. Records show that the non-profit spent $100,736 on programs including a basketball tournament, but that $150,000 remains unaccounted for.

In 2005, New Direction established a charity called NOAH-F, which was to provide funds for Hurricane Katrina families who relocated to New York City. Records show that of the $31,000 raised, only $1,392 was delivered to victims.

On Monday, the New York Post reported that Louis Rainey, a former Louisiana politician, was chosen to identify the families and insure that they got the help they needed.

Rainey told Post reporter Rebecca Rosenberg that Meeks and Smith visited the area and promised all sorts of assistance.

“We never got it,” Rainey said. “We never got a penny.”

He added that he got a truck that was full of old clothing to distribute to victims of the devastating hurricane.

The charity’s treasurer, Edwin Reed, who is a deacon of Floyd Flake’s church and who is the church’s treasurer as well, said, “I can’t recall any details [of how the money was distributed].”

Smith said that he “didn’t have anything to do with the day to day operations” of the charity and that he had no idea where the money went.

Then, on Monday of this week, The Post reported that Meeks secured a $100,000 federal grant for the Ocean Bay Community Development Corporation, funds earmarked for the corporation’s job training program after receiving campaign donations totaling $3,850 over the past four years from Ocean Bay’s executive director, Patricia Simon.

Records show that last year’s donation to Meeks’ war chest was $1,500 and came as the promise of the $100,000 was working its way through the bureaucracy.

And, while it is not illegal for benefactors of Congressional largess to donate money to politicians, watchdog groups speaking to The Post called it a “form of legalized bribery.”

On Wednesday, Meeks called The Wave to deny that he had any direct involvement in either the Katrina charity or in the development corporation.

“Iwas just trying to help out community organizations,” he said.

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