John L Sampson, a New York state senator of Guyanese parentage and a former leader of the Democratic caucus, was taken into custody yesterday morning by US Federal Bureau of Investigation (FBI) agents following a public corruption probe, according to a spokesman for the FBI.
Sampson, 47, is accused of embezzling about US$440,000 in funds pertaining to the sale of foreclosed properties that he kept for himself instead of returning to court officials in Brooklyn. Sampson was serving as a referee in the sale of the properties.
According to court documents seen by this newspaper, Sampson has been charged with nine counts, which include, tampering with evidence, tampering with witnesses, making false statements, concealment of records, obstruction of justice and embezzlement. The charges stem from Sampson’s alleged misappropriation of funds from the escrow accounts relating to the foreclosure of four Brooklyn, NY properties.
Sampson, who is also a lawyer, had been serving as a court-appointed referee for foreclosure proceedings conducted by Kings County Supreme Court beginning in the early 90s. It is believed that he embezzled the US$440,000 from four escrow accounts he controlled over a number of years, beginning in 1998.
According to the court documents, once a property was foreclosed, the referee would be entrusted with conducting the sale of the property. If the sale generated a surplus, that sum was placed in escrow and the prior owners of the property or their creditors had a right to these funds.
It is alleged that Sampson breached his fiduciary obligations as referee with regard to four properties, at Forbell Street, Eighth Ave, Linden Boulevard and Bay Ridge Ave, all in Brooklyn in that he took the surplus funds and converted them to his own use.
It is also alleged that around July 2006, he asked an Associate (an individual involved in the real estate business and whose identity is known to the Grand Jury) for $188,500 as a loan that he would repay. The loan, he allegedly told the Associate, was to repay money from foreclosure sales which he had used to pay expenses arising from his unsuccessful 2005 campaign for Kings County District Attorney. However the money was never repaid and the court documents charged that Sampson did not divulge information about this loan in his Senate financial disclosure forms as required.
The Associate was later arrested in July 2011 on bank and wire fraud charges and it is alleged that Sampson then began to engage in a scheme to obstruct justice. He reportedly attempted to obtain confidential non-public information pertaining to the Associate’s case and further directed the Associate to withhold documentation from the government. This involved a check register page, wherein the Associate had detailed his ‘loan’ to Sampson. Sampson reportedly met the Associate at a restaurant in Queens where he collected the check register page and advised the Associate to remove other documents so that it would appear to the FBI that he had not kept complete records.
However, from mid-December 2011 through mid-March 2012, law enforcement conducted a judicially-authorised wiretap of Sampson’s cell phone. A phone call Sampson made to the Associate, in which he asked if he had made copies of his documents, was recorded by law-enforcement officials.
The court documents said that when Sampson was later shown the same check register page by FBI officials he claimed it did not “ring a bell” and that he had no recollection of it.
If Sampson is found guilty of embezzlement, the US government will seek forfeiture of all property, real or personal. That constitutes or is derived from proceeds traceable to any such offences. However, if any such property cannot be located upon the exercise of due diligence, has been transferred, sold or deposited with a third party, has been placed beyond the court’s jurisdiction, has been diminished in value or commingled with other property so that it cannot be divided without difficulty, the US will seek to forfeit other property of similar value belonging to the defendant.
Sampson, who is a member of the New York State Senate representing the 19th Senate District in southeastern Brooklyn, was leader of the Democratic Conference of the Senate from June 2009 to December 2012. He was also Minority Leader of the Senate from January 2011 to December 2012. Sampson was first elected to the Senate in 1996.
Sampson recently appeared on the radar of law enforcers over his relationship with Guyanese businessman Edul Ahmad, a Queens real estate broker whom he represented as a law client. Ahmad pleaded guilty in federal court in October to a mortgage fraud scheme and has also been at the centre of a loan scandal involving Representa-tive Gregory W Meeks, a Queens Democrat. Ahmad is awaiting sentencing.
