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MANHATTAN---Three individuals and five companies have pleaded guilty to their roles in corruption-related charges involving former New York State Banking Department officials and C.L.B. Check Cashing, Inc. of Springfield Gardens, one of the largest check cashing companies in New York State.
The defendants, C.L.B. Check Cashing Inc., executives Louis Renzo and William DeRespino, 45, of Rockville Centre, a former NYSBD bank examiner, and related corporations owned by Renzo, 57, of Woodmere, pleaded guilty Friday to one count of rewarding official misconduct in the second degree, a class E felony. Former New York State Banking Department bank examiner James Gass, 66, of Chester, Orange County, pleaded guilty to one count of second degree receiving reward for official misconduct, also a Class E felony.
As a result of the pleas, C.L.B. Check Cashing Inc. and owner/present Renzo will surrender to the New York State Banking Department 30 branch licenses and eight limited station licenses to be a casher of checks in New York State. Renzo, DeRespino and Gass will be subject to a lifetime ban from involvement, either direct or indirect, in the financial services industry. Together, the defendants will pay a total monetary penalty of $4.3 million.
Specifically, at the time of the pleas, the trio paid a sum of over $1.9 million dollars in connection with a Stipulation of Settlement of the related asset forfeiture proceedings and C.L.B. Check Cashing, Inc. and Renzo will pay a civil fine of over $2.3 million dollars to the New York State Banking Department prior to their sentencing, the largest fine ever levied against a check casher. If the three men fully comply with the aforementioned conditions of their pleas, they will each be sentenced to a term of five years probation.
As a bank examiner in the Licensed Financial Services Division, Gass was responsible for overseeing and monitoring the compliance of many check cashers, including C.L.B. Check Cashing, Inc. The investigation leading to the pleas revealed that the defendants engaged in a corrupt relationship pursuant to which Gass received benefits including cash and employment from Renzo and DeRespino in exchange for providing confidential NYSBD information to the check cashers in violation of his duties as a bank examiner. The defendants concealed this corrupt relationship from the NYSBD thereby creating a serious conflict of interest between the check cashers and a NYSBD bank examiner who was responsible for regulating them.
For his corrupt assistance, prosecutors say Gass received more than $30,000, at least $15,000 of which was cashed at the C.L.B. Check Cashing, Inc. headquarters. Upon his retirement at the end of March 2003, Gass went to work for C.L.B. as the "compliance officer" at a salary of $85,000 per year.
The independence of bank examiners is critical to the integrity of the New York State Banking Department and its regulatory mandate to ensure the safety and soundness of its licensees for the good of the public, prosecutors said. In the context of the check cashing industry, this mandate is even more vital because of the ever present potential for check cashing services to be used for criminal purposes, such as money laundering and the funding of criminal enterprises. As such, New York State Banking Department regulations as well as the New York Public Officers Law specifically prohibit even the appearance of conflicts of interest between bank examiners and the entities they regulate. The defendants' corrupt arrangement violated the core of these ethics codes and compromised the public's trust in government. 4-28-07
© 2007 North
Country Gazette
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