In 2018, seven employees of two medical companies in New Jersey began donating thousands of dollars to the campaign treasury of then-Brooklyn Borough President Eric Adams.
They worked for two companies — Ridgewood Diagnostic Lab and Interstate Multi-Specialty Group, both in Hackensack, and owned by Dr. Alexandr Zaitsev, who was among the Adams donors.
They each gave what was then the maximum amount, $5,100, or close to it, to the campaign account for Adams between April 19 and Nov. 29, 2018, Campaign Finance Board records show.
At the time, Adams had not officially declared he was running for mayor.
Ridgewood, Zaitsev and two other of the Adams donors are now defendants in a lawsuit filed by GEICO in September 2020, with the insurance company alleging they and other medical groups billed GEICO for more than $4.5 million in fraudulent claims.
The lawsuit filed in Brooklyn Federal Court and first reported by Bloomberg News, also lays out the two medical companies’ connection to Adams chief of staff Frank Carone, who was a part owner of two limited liability corporations that helped finance their launch.
The employees donated $40,600 to the campaign by the end of 2018.
They were all later refunded more than half of the money after the Campaign Finance Board made changes to the maximum amount for donations when a candidate takes part in a matching-funds program.
During his mayoral campaign, Adams opted to take part in the new 8-to-1 matching-funds program — which allows $2,000 per person, with city-funded matching dollars for New York City-based donors.
A spokesperson for Adams, Max Young, said that Carone had nothing to do with the contributions from the mostly Jersey-based donors.
“Mr. Carone was a passive investor in these LLCs, didn’t solicit these donations, never met the donors in question, and had no knowledge that they donated, then or now,” said Young in a statement.
“Mayor Adams was honored to receive donations from thousands of New Yorkers from all over the city, under New York’s strict campaign finance laws,” added Young.
The seven employees who gave to the Adams campaign had never before, nor since, donated to any other New York City candidates, records show.
That group includes Zaitsev, who owned Ridgewood Diagnostic Lab and Interstate Multi-Specialty Group and is also a part owner with Carone in the LLCs that fronted him money, according to records revealed in the lawsuit. He gave $5,100 to the Adams campaign on April 19, 2018, records show.
Lawyers for Zaitsev did not respond to calls and an email seeking comment. The other employees who donated money to Adams either declined to comment or could not be reached for comment.
GEICO’s lawsuit alleges that Carone, along with his former law partners, father and son Howard and Jordan Fensterman of the firm Abrams Fensterman LLP, used limited-liability companies to advance money to Zaitsev and other medical companies as they waited for insurance claims to process.
After fronting the money, the LLCs would be paid back with interest when GEICO paid the no-fault claims, the company alleged in its suit.
The companies that fronted the cash to the medical groups, Financial Vision Group LLC and others with similar names, are owned by Zaitsev and Daniel Kandhorov, according to court documents.
Kandhorov, who lives in Queens, could not be reached for comment.
A spokesperson for the Fenstermans said they had no knowledge of any donations to the Adams campaign.
In total, there were four Financial Vision Group LLCs registered in Delaware, records show, and are partially controlled by Carone and the Fenstermans.
Within some of the limited-liability companies are other LLCs with percentage stakes, including DMC Capital Group, which is owned primarily by Carone and the Fenstermans, documents show.
Another partial owner of DMC Capital Group is Monsignor Jaime Gigantiello, who owns a 7.5% stake in the company, according to court documents.
Gigantiello is the director of the office of parish giving in the Brooklyn Diocese as well as the vicar – one of the highest administrative roles in the diocese, with powers similar to that of a bishop — for development.
“Monsignor Jamie Gigantiello made a personal investment with a well-respected friend,” John Quaglione, deputy press secretary for the Brooklyn Diocese, said in a statement.
Providing money up-front to medical companies waiting for insurance payouts was part of the law firm’s health-care practice, doling out money as a stop-gap in larger insurance companies paying out claims, a City Hall official said.
The official added Carone’s involvement in these financial companies ended as he and other investors lost money in the deal. The pandemic put a pause on in-person litigation, which delayed payment to the investors who fronted money to the health-care companies.
As a city employee, Carone also moved all of his other investments into a blind trust, the official said.
Carone’s tangential involvement in the suit was also reported on by the Daily News, which noted a connection between Johnny and Robert Petrosyants — twin restaurateur brothers with financial crime felony records — and the financing companies.
A log of emails between them and Carone were included in court filings, but the full transcripts were not released. The logs do show a connection between the brothers and Carone, they reported.
Adams has previously defended his relationship with the Petrosyants, saying they have a longstanding friendship.