Assembly Speaker Sheldon Silver’s close pal William Rapfogel was busted Tuesday on grand larceny, money laundering and tax fraud charges for pulling off a $5 million kickback scheme, authorities said.
The longtime boss of the Metropolitan New York Council on Jewish Poverty surrendered weeks after he was fired from his prestigious post as the $400,000-plus a year CEO of the charity, a story first reported by The Post.
Rapfogel, 58, allegedly conspired with an employee of the charity’s insurance broker, Century Coverage Corporation, to illegally inflate payments for insurance bills by roughly $5 million since the early 1990s, according to a criminal complaint.
Rapfogel – whose wife, Judy, is Silver’s chief-of-staff – got regular envelopes stuffed with cash and also checks for personal expenses, including $27,000 to pay a contractor for home improvements, the complaint charged.
He also directed an unnamed official of the insurance firm to make numerous donations to political campaigns and politicians – including the powerful Assembly speaker.
And he directed that the donations be made in small amounts to maximize the amount of ”matching funds” that would come from the city.
One of the city’s largest social service providers, the Met Council has snared $16.5 million in state funds and at least $1.6 million in City Council grants this year — accounting for more than half its $33 million budget.
He even charged thousands of dollars of personal expenses to a Met Council credit card, the complaint said.
And at one point he had $100,00 in cash converted into a check to help his son buy a home, according to the complaint.
Authorities said he kept $1 million for himself with the rest going to unnamed co-conspirators – and paid no taxes on the ill-gotten gains.
Investigators seized about $400,000 in cash Rapfogel had stashed in his home, they said.
The arrest came after an investigation by Attorney General Eric Schneiderman and state Comptroller Thomas DiNapoli in which two unnamed co-conspirators – one from the insurance company and one from the Met council – implicated Rapfogel, according to the criminal complaint.
“It’s always sad and shocking when we discover that someone used a charity as their own personal piggy bank — but even more so when that scheme involves someone well-respected in government and his community,” Schneiderman said in a statement.
“The scale and duration of this scheme are breathtaking,” DiNapoli added. “When individuals in the mission of helping others instead help themselves, it is particularly egregious. But eventually, fraud, no matter how cunning, unravels.”
Rapfogel turned himself in at the NYPD’s 1st Precinct and was later freed on $100,000 cash bail after his arraignment in Manhattan Criminal Court.
Clad in a black suit – and knitted yarmulke – he had no comment in court or when he was walked from the precinct house.
Outside court, his lawyer, Paul Shechtman, called it “a sad day” for Rapfogel.
“Mr. Rapfogel hopes for a fair resolution in this case and will continue to make amends to Met counsel. It’s a sad day but happily people who know Willie well are still in his corner,” he said. “It’s a lovely day and no one should spend it in arraignments.”
Prosecutor Gary Fishman asked that his passport be surrendered and that his travel be restricted to New York and New Jersey. Judge Kevin McGrath agreed to the request.
In all, he was charged with one count each of grand larceny and conspiracy, two counts of money laundering, four counts of tax fraud and five counts of falsifying business records
Rapfogel had issued a statement after he was canned apologizing for “mistakes I have made that led to my departure.”
Century Coverage CEO Joseph Ross and other company employees contributed $120,000 to political candidates since the 1990s — among them hooker-happy ex-Gov. Eliot Spitzer as well as Silver.
When Rapfogel was axed, Silver said he was “stunned and deeply saddened” by his friend’s alleged wrongdoing.
He declined further comment Tuesday.
Rapfogel’s lawyer, Paul Shechtman, had earlier said neither Silver nor Rapfogel’s wife was aware of the scheme.
Schneiderman said the investigation is continuing.