Former NYC Mayoral Chief-Of-Staff Frank Carone and three others, including his brother, have been charged in a 13-count federal indictment for an alleged bribery scheme involving a multi-million dollar migrant shelter contract.
The indictment, unsealed today in Brooklyn federal court, accuses Frank V. Carone, Anthony J. Carone, Crystal Chen, and Yan Po Zhu (also known as “Andy Zhu”) of fraud, bribery, money laundering, obstruction of justice, and tax fraud. Authorities allege the defendants exploited New York City's migrant crisis for personal profit, with Frank Carone using his official position to steer a lucrative contract to a Long Island City hotel.
According to court filings, Frank Carone allegedly accepted $120,000 in bribe payments from Zhu, the owner of the Microtel hotel, and his business manager Chen, to secure an Emergency Shelter Contract for the hotel. This occurred despite the City’s Department of Social Services (DSS) repeatedly rejecting the Microtel as unsuitable for a migrant shelter. The Microtel ultimately received a contract worth $6,825,000.
To conceal the illicit payments, Zhu and Chen allegedly directed funds to a bank account controlled by Anthony Carone's law firm, which then funneled money to Frank Carone, including paying his personal credit card bills. Both brothers, who are attorneys, are also charged with evading taxes on these proceeds and obstructing justice by fabricating a backdated promissory note in July 2024 after becoming aware of a federal investigation.
First Assistant United States Attorney Michael Considine said, “The defendants engaged in a bribery scheme to secure a migrant shelter contract worth millions of dollars from a city agency funded in part by billions of federal dollars.” FBI Assistant Director in Charge James C. Barnacle, Jr. added that the alleged conspiracy resulted in "a massive betrayal of the American taxpayers’ trust." If convicted, the defendants each face up to 20 years in prison.