Appeals victory lets Sheldon Silver keep $2.38M reaped in alleged corruption scheme

Sheldon Silver leaving Manhattan Federal Court after his sentencing in July 2018.
Sheldon Silver leaving Manhattan Federal Court after his sentencing in July 2018. 

A federal appeals court’s decision to toss much of ex-Assembly Speaker Sheldon Silver’s corruption conviction means he can keep millions he reaped in what a judge, prosecutors and two juries once deemed an illegal scheme.
Prosecutors and defense lawyers have an agreement in principle to slash by $2.38 million the sum Silver was ordered to hand over to the federal government at a sentencing hearing two years ago, say papers in Manhattan Federal Court.
The $1.36 million Silver would forfeit under the post-appeal deal lawyers reached last week is a 64% discount from the $3.74 million in illicit gains he was told to pay the feds in July 2018.
Silver — once one of Albany’s most powerful politicians — will also have to turn over investment gains on the money, the amount of which isn’t stated in the agreement. Part of the $1.36 million forfeiture and the investment gains could be covered by money Silver has already paid the government.
The agreement — to be formalized later this week — hews to the appeals court ruling in January that overturned Silver’s conviction on the most lucrative of his alleged crimes. Manhattan Federal Judge Valerie Caproni will have to approve the deal.
The $2.38 million reduction to the forfeiture Caproni imposed two years ago mostly represents fees Silver received from Weitz & Luxenberg, a Manhattan-based law firm that specializes in representing people with mesothelioma, a deadly disease contracted by inhaling asbestos fibers.
In 2005 and 2006, Silver allotted $500,000 in state money he controlled to a mesothelioma clinic run by Dr. Robert Taub at Columbia-Presbyterian Medical Center in Washington Heights. In return, prosecutors said, Taub gave Silver the names of some of his patients, which Silver turned over to Weitz & Luxenberg.
Weitz & Luxenberg paid Silver $3.1 million in the fees it earned representing Taub’s patients in asbestos litigation, investigators found.
A jury convicted Silver in 2015 of the charges that he unlawfully took Weitz & Luxenberg fees as well as several hundred thousand dollars in fees from his friend Jay Goldberg’s law firm, which handles property tax appeals for real estate developers.
One of the clients Silver steered to Goldberg was Glenwood Management, which operates luxury apartment buildings and for years was a big donor to Albany politicians. The other was The Witkoff Group, which owns part of The Woolworth Building and a variety of other properties, including some in Silver’s former lower Manhattan Assembly district.
After the 2015 verdict was overturned on appeal, Silver was tried again and convicted again of the same charges in 2018.
A panel of Manhattan Federal Appeals Court judges in January dismissed the Weitz & Luxenberg part of the case, mainly because the judges didn’t see a strong enough quid pro quo between Silver and Taub. When the Weitz & Luxenberg charges were tossed, the government lost its right to demand Silver hand over the fees he got from that scheme.
Silver is to be sentenced July 20 on the remaining charges in the case of mail fraud, wire fraud and extortion involving fees paid to him by Goldberg’s law firm. He also faces a money laundering charge.

Before the mesothelioma charges were tossed, Caproni sentenced Silver to seven years in prison and a $1.75 million fine, as well as the forfeiture. It’s unclear what sentence and fine Silver may receive at next month’s hearing. Silver has asked that the July 20 hearing be conducted by remote video.

Silver, who has never expressed guilt for his crimes, considered his work as Assembly speaker to be a part-time job.

In court papers two years ago, Silver’s lawyers wrote that when he sought legal fees from Weitz & Luxenberg and from Goldberg’s law firm, “nothing put Mr. Silver — or anyone else — on notice that … a public official can be convicted of bribery for being influenced, even just a little bit, by industry-standard referral fees received in permitted outside employment.”

Silver plans an appeal to the U.S. Supreme Court that his lawyers say in court papers “will present substantial questions.” Justice Ruth Bader Ginsburg in April denied without comment Silver’s request to delay his sentencing while the Supreme Court decides whether to hear his case.

Silver’s lawyers declined to comment on the forfeiture agreement.

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