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De Blasio Violated Fundraising Ethics Rules Even After Warning — Yet Mayor Faced No Penalty

Letters released after a protracted battle to shield them from public view show ethics board cited the mayor in 2014 and again in 2018 for asking real estate industry players with pending city business to give to his Campaign for One New York nonprofit.

Mayor Bill de Blasio
Mayor Bill de Blasio delivers his executive budget at City Hall, April 25, 2019.
Ben Fractenberg/THE CITY

Mayor Bill de Blasio violated ethics rules twice by hitting up real estate industry players for donations to a nonprofit he created to boost pet projects, a city board found — but he got away with just warning letters.

City Hall released the two letters Wednesday from the Conflicts of Interest Board, dating from 2014 and 2018, after losing a protracted legal battle with The New York Times to shield the missives from public view.

It was a Department of Investigation report obtained by THE CITY in April 2019 that initially revealed the mayor had solicited funds from donors who had business pending with his administration.

The ethics letters concern the Campaign for One New York, a group that raised over $4 million between 2014 and 2016 to tout such initiatives as pre-K and affordable housing — and promote de Blasio himself as he sought to influence the 2016 Democratic presidential primary.

The records reveal for the first time that the conflicts board cited de Blasio just six months into his administration, in July 2014, for violating ethics rules by personally soliciting $150,000 in donations from people or entities with business before the city.

Not even seven months after receiving the 2014 warning, he kept making similar fundraising calls — asking for donations from two additional developers and James Capalino, a lobbyist who had helped buoy his campaign for mayor, according to the 2018 warning letter.

‘Coercion and Improper Access’

Both violations occurred after the board had advised de Blasio’s campaign lawyer just after the mayor’s January 2014 inauguration that solicitations of that nature are prohibited by the city’s charter.

The conflicts board noted in 2018 that the mayor also failed to provide a disclaimer to potential donors that their donations wouldn’t influence any city decisions.

“By soliciting these three donations from firms with business pending or about to be pending before executive agencies, and providing no disclaimers, you not only disregarded the Board’s repeated written advice, but created the very appearance of coercion and improper access to you and your staff that the Board’s advice sought to help you avoid,” the September 2018 letter says.

Despite the stern wording of the letter, it concludes that because the mayor’s nonprofit was disbanded in March 2016 — and because City Council passed legislation further regulating donations to city-affiliated nonprofits — that no discipline was warranted other than the warning.

De Blasio went on to create a new organization to promote his eventual run for president in 2020, Fairness PAC, which proceeded to obtain donations from individuals who did business with or had matters pending before city government.

Both Conflicts of Interest Board letters were signed by its chair during those years, Richard Briffault, a government ethics expert and Columbia Law School professor whom de Blasio appointed in February 2014.

Briffault, who was not reappointed to the board last year despite being eligible to stay on, didn’t respond to an email seeking comment.

‘Not Specifically Aware’

The Department of Investigation’s two-and-a-half-year investigation found in 2019 that de Blasio had solicited donations from at least three entities with business pending before executive city agencies.

Although the probe wasn’t launched until 2016 — after de Blasio had received the first warning letter — the mayor told investigators that he was unaware of the specific rules governing his fundraising endeavors, according to the DOI report, produced in October 2018.

Mayor Bill de Blasio speaks on the first day of coronavirus vaccinations at Yankee Stadium, Feb. 5, 2021.
Mayor Bill de Blasio speaks on the first day of coronavirus vaccinations at Yankee Stadium, Feb. 5, 2021.
Hiram Alejandro Durán/THE CITY

“The mayor stated that he was generally aware that COIB rules governed his CONY fundraising activities, but he was not specifically aware of the restriction against soliciting individuals with a matter pending or about to be pending before an executive branch agency, nor was he specifically aware of the requirement to inform potential donors that their decision to give or not give would not result in official favor or disfavor,” DOI stated.

Both of those rules are specifically bulleted as prohibitions in the two-page letter from the conflicts board to the mayor in July 2014, which is addressed to him by name at his Gracie Mansion residence.

That letter notes that no disciplinary action would be taken against the mayor because it was his office that brought to the board’s attention the two solicitations that turned out to be ethical violations, and because the lone donation received had been returned.

Mayor Called Atlantic Yards Developer

The letter details that on Jan. 21, 2014, the mayor called Bruce Ratner, chair of Forest City Enterprises, and asked for $50,000 for his nonprofit, which at the time was known as UPKNYC because it was advocating for universal pre-K.

Forest City had a host of city real estate projects in the works at the time, including a major development at Atlantic Yards in Brooklyn, the letter says.

Soon afterward, Ratner’s brother-in-law mailed the nonprofit a $25,000 check, the board letter adds, noting that donation was subsequently returned.

Weeks later, on Valentine’s Day, de Blasio called the CEO of SL Green Real Estate Corp, Marc Holliday, asking for a contribution of $100,000 toward CONY.

At the time, the firm was working on a major project at 1 Vanderbilt, directly across the street from Grand Central Station, but Holliday didn’t provide any donations, according to the letter.

The conflicts board recommended that the mayor’s office implement a vetting system for its fundraising activities, to ensure targeted firms and individuals didn’t have business pending with the city.

According to the DOI report, such a vetting system had been set up a few months prior, but it wasn’t supervised closely enough to ensure a successful implementation.

The board also warned of potential fines for ethics rules violations of up to $25,000. “With the issuance of this confidential letter, the Board is closing the case,” the letter concludes.

City Charter Violation

The second warning letter appears to stem from the investigation conducted by DOI, although the investigation’s findings were heavily redacted in records THE CITY obtained.

The COIB letter says that on Feb. 15, 2015, de Blasio called Jeffrey Levine, the chair of the real estate firm Douglaston Development LLC, and mentioned the Campaign for One New York.

He had the nonprofit’s fundraiser, Ross Offinger, follow up with a call that yielded a $25,000 donation from Levine — at a time when Douglaston had “various business matters pending before City agencies,” the letter states.

On March 20, 2015, the mayor went through the same two-step process with David Von Spreckelsen, president of the Toll Brothers real estate company, which yielded another $25,000 contribution, the COIB letter says.

In April 2015, the mayor turned to a real estate lobbyist who had supported his election, James Capalino. Following the same script, the mayor got $10,000 from Capalino, who also arranged for $90,000 in donations from his clients, the letter says.

“A public servant who engages in solicitations such as these, either directly or through a surrogate, acts in conflict with that public servant’s official duties,” the September 2018 letter says.

Yet when THE CITY asked City Hall in April 2019 about the mayor’s ethical lapses in soliciting funds for his nonprofits, a spokesperson responded that “the mayor acted lawfully and ethically.”

Mayor Claimed Ignorance

The mayor’s office on Wednesday maintained that de Blasio’s calls were governed by a process that resulted in a specific script, which included appropriate disclaimers.

“The calls the Mayor was making at this time were to support affordable housing legislation and his effort to achieve Universal Pre-K for every child in New York City, which is now a national model,” said Danielle Filson, a de Blasio spokesperson. “He has consistently acted in good faith and followed the process set out for him. The Board closed these cases and determined no enforcement action was necessary.”

Filson didn’t immediately respond when asked about the mayor’s claimed ignorance about the rules governing his fundraising, as described in the DOI report, given his receipt of the July 2014 letter from COIB that specifically highlighted those rules.

The de Blasio administration used public funds to fight The New York Times lawsuit, but ultimately failed to prevail with the state’s top Court of Appeals.

When The Times had first sought to unearth the letters, in April 2019, a reporter there asked the mayor whether he had ever received a private warning letter from the Conflicts of Interest Board.

The mayor had received two such warning letters by that time.

“I know what the Conflict of Interest Board is,” the mayor responded, “but I don’t know what a private warning letter is.”

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