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De Blasio Asked Me for $20K And it Was Hard to Say No, Developer Says

By  Jeff Mays and Murray Weiss | May 4, 2016 3:02pm 

 Don Peebles
Don Peebles
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DNAinfo/Jeff Mays

NEW YORK CITY — A real estate developer said Bill de Blasio personally called him to donate $20,000 to a nonprofit to promote universal pre-K while he had business before the city — and that it was hard "to tell the mayor no."

Don Peebles, whose real estate company owned a building they later got city approval to turn into condos, told DNAinfo New York that in March 2014 he received a call from the mayor asking him to contribute the money to the nonprofit, now called the Campaign for One New York.

Federal and state investigators are probing whether the nonprofit illegally raised funds and if contributors got favors from the city in exchange for their donation.

READ MORE: Here's What We Know About the Probe Into Mayor Bill de Blasio's Fundraising

"He asked me for a specific dollar amount," Peebles, who's a possible 2017 mayoral candidate, said during an interview in his Fifth Avenue offices Monday.

Even though he believed universal pre-K was important and wanted to support the cause, Peebles, a past de Blasio fundraiser, said he was wary about the call.

"It's hard for a business person who has business interests in New York City to tell the mayor no, especially real estate developers," Peebles said.

Asked what he thought of the mayor personally calling developers and others who have or might have business before the city Peebles said:

"What that call says is that it's important to the mayor," he continued. "The other thing it says is that the mayor knows that you're helping him. If you don't help then you're making the mayor upset with you, so you can't tell him no. The plus side is that if you say yes then the mayor knows you helped."

Peebles, who heads the Peebles Corporation, a national real estate development and investment firm, was estimated last year to have a net worth of $700 million by Forbes.

He said he was first contacted in January 2014 by Ross Offinger, de Blasio's former campaign manager and a point person for other mayoral political action efforts, who was raising money for the Campaign for One New York's predecessor, UPKNYC.

But the two didn't connect until February 2014, when Peebles was finalizing a bid for the Long Island College Hospital site in Cobble Hill. Peebles said he told Offinger he would get back to him on fundraising in the future. 

De Blasio called a month later, Peebles said. He instructed his staff to send a check on March 6.

City and state law forbids public officials from soliciting funds from individuals or entities who have business interests before the city or are likely to in the future.

De Blasio's fundraising pitch was followed by a call "within minutes" from Offinger, Peebles said.

Offinger, and top mayoral aide Emma Wolfe, have been subpoenaed by investigators probing the fund.

READ MORE: Federal Probe Eyes Possible Straw Donors to De Blasio Campaign, Sources Say

Records also show that in 2014 the city was a tenant at 346 Broadway, a TriBeCa building owned by The Peebles Corporation.

At the time, the company was preparing to appear before the Landmarks Preservation Commission regarding the building, which was purchased from the city in December 2013 for $160 million. The commission approved a $334 million plan last year to convert the building into 144 condominiums.

Peebles and partner North Shore-LIJ made a $260 million bid to develop the LICH site. It was the second-highest bid and was submitted on Feb. 3, 2014, around the time Offinger began asking for donations, Peebles said.

But SUNY Downstate Medical Center ended talks with Peebles over an impasse about remediation costs on May 28, 2014 and later made a deal with Fortis Property Group.

Campaign for One New York paid to distribute a June 26, 2014 letter from Gary Reilly of the Carroll Gardens Neighborhood Association that said a deal to sell Long Island College Hospital to Fortis was good for Brooklyn residents.

Reilly wrote that de Blasio asked him to "share my views on what this means for families" in Brooklyn. "The outcome is much better than we expected."

During his campaign for mayor, de Blasio was arrested protesting the closure of the hospital.

"I thought it was inappropriate for funds that were meant to be able to promote educational opportunity to start validating a business transaction involving the state of New York that had nothing to do with universal pre-K," Peebles said.

He asked the mayor to return his $20,000, and the mayor acknowledged in an email that the check had been returned.

Peebles said de Blasio called him again to request money for the mayor's failed 2014 bid to help Democrats take back the state Senate. Peebles said he declined to contribute to that effort.

The developer isn't the only person de Blasio hit up for money.

One person in the real estate industry who Peebles introduced to de Blasio for fundraising purposes, but who declined to be interviewed because they have business before the city, called Peebles after de Blasio asked for $50,000 for his effort to win back the Senate.

"They just felt uncomfortable. They didn't want to tell the mayor no," Peebles said of the call. "They called me for help to guide them on how to get the mayor to lower the amount because they felt it was too much for them."

And just last week, supermarket billionaire John Catsimatidis, who once ran for mayor, was quizzed, as expected, by investigators about a $50,000 donation he gave at the request of the mayor.

Catsimatidis said he donated to the Putnam Country Democratic Committee, as de Blasio asked, but the funds quickly wound up in the campaign of an upstate Democratic candidate, apparently as part of the mayor’s Senate initiative.

Investigators specifically wanted Catsimatidis to detail the “process” by which he was asked for the money, who followed up to get it (in this case it was Offinger), and how the $50,000 was paid.

The sweeping federal and state probe into de Blasio's political fundraising apparatus “has so many tentacles” that investigators are eyeing possible criminal conspiracy charges for those involved in any wrongdoing, sources said.

Conspiracy charges historically serve as an umbrella that includes other offenses such as mail fraud, wire fraud, election law violations and even money laundering. They've been used to take down various criminal enterprises from the mob to white collar fraudsters.

The feds “are not looking for one deadly sin,” a source familiar with the investigation said. “[They are looking] at this as a potential corrupt organization, that the fundraising mechanism is corrupt.”

Sources say that the Justice Department in Washington has been briefed on virtually every move the Manhattan U.S. Attorney Preet Bharara has made, including the recent decision to issue subpoenas to the mayor's office.

De Blasio spokesman Peter Kadushin referred a reporter to the mayor's previous comments on Tuesday.

"I'm confident of the fact that we handled everything legally and ethically; that we did the things I wish more people would do in public service, we sought guidance from an ethics board," de Blasio said at an unrelated Queens press conference, adding that he sought legal advice from lawyers and opinions from the Conflicts of Interest Board.

The mayor has also said that he and organizations he's associated with are cooperating fully with the investigation. De Blasio has blamed his woes on political foes angry at his progressive positions and says he is facing a "double standard" of scrutiny.

In a letter requesting an investigation of the Campaign for One New York, good government group Common Cause New York's executive director Susan Lerner said de Blasio's "direct involvement" with the nonprofit "raises troubling questions regarding the legality of his conduct under New York City's conflict of interest and campaign finance laws" and also "raises serious questions about who has influence and access to the policymaking process."

Dick Dadey, executive director of Citizens Union, called de Blasio's fundraising activities "unethical and unseemly" behavior.

"It's very difficult when the mayor of New York City calls asking for a specific contribution, a specific amount of money, to say no when you are asking him to say yes on a specific public policy matter," Dadey said. "Lobbyists and others with business before the city feel the compulsion to contribute when asked by the mayor because they want to be sure nothing hurts their chances."

The City Charter says “no public servant shall use or attempt to use his or her position to obtain any financial gain, contact license, privilege or other private or personal advantage direct or indirect for the public servant or any person or firm associated with the public servant.”

The state’s public officers law is even more explicit, barring elected officials from “soliciting funds from any individual or business entity that currently has matters before (it)," or “has substantial reason to believe will have matters before (the city) in the foreseeable future."

And the mayor may have violated a Conflict of Interest Board edict warning him about doing direct solicitations to "anyone with a matter pending or about to be pending" before the city, NY1 reported.

De Blasio lawyer Maya Wiley said there "was a process in place to insure that this guidance was scrupulously followed."

Manhattan District Attorney Cyrus Vance Jr. joined the ongoing federal investigation into de Blasio's fundraising tactics last January after the Board of Elections' chief investigative officer sent a “criminal referral” to Vance’s office alleging the efforts of the mayor’s nonprofit to unseat the Republicans violated campaign finance laws, Vance has said.

“Bringing in the Manhattan DA is smart, because they can charge local laws that (we) can’t do and might be better handled there,” the source familiar with the probe said.

In addition to subpoenaing documents, email and computer data, federal authorities have wiretapped numerous people since early 2015 — that’s when the investigation, which began with an allegation that NYPD Chief of Department Philip Banks was accepting gifts for favors from two businessmen, began to widen.

The businessmen, Jona Rechnitz and Jeremy Reichberg, donated to de Blasio’s election campaign and served on his Inauguration Committee. Rechnitz also gave $102,000 to the statewide Democratic Senate Campaign Committee and $50,000 to the mayor’s nonprofit. He had bundled more than $44,000 for de Blasio’s 2013 election.

"When this investigation finally rolls out, there will not be an out-of-work criminal defense attorney in New York," said another source familiar with probes.