NYC Minority “Leaders” Charged with Racketeering, Extortion

Is it affirmative action or is it crime?  Recent revelations of a shakedown racket operating under the cover of a City of New York construction industry minority-hiring program make a compelling case that there’s not much difference between the two.  A number of years ago, the City created a program, with the inevitable good intentions, to promote contractor hiring of blacks and other racial minorities.  But at least in one case the result was a criminal empire managed with an efficiency and ruthlessness that would have given any Mafia family a good run for its money.  Last month, New Yorkers learned something about the price its operators had been exacting.


On September 13, the Manhattan District Attorney’s Office announced the arraignment in New York State Supreme Court of four men who nominally headed minority-hiring “coalitions.”  Charged with various counts of racketeering, extortion and larceny are:  Derrick “Sha” Walker and Frederick Rasberry, who ran an entity called Akbar’s Community Services; and Reginald Rabb and Steven Mason, who ran P&D Construction Workers Coalition.  For years, the indictment stated, the four cut themselves sizable turf in the city’s $13 billion-a-year construction industry by intimidating contractors and workers, and shutting down projects if would-be victims didn’t pay up.  That Walker and Rabb used their membership in Local 731 of the Laborers International Union of North America as a cover for their many criminal acts merely adds to the parent union’s well-established reputation for corruption.  “Minority labor coalitions were created ostensibly to increase employment opportunities for minority workers in the construction industry,” said Manhattan District Attorney Robert M. Morgenthau.  “However, as today’s indictments demonstrate, this seemingly worthwhile effort is often merely an excuse to extort no-show jobs from contractors anxious to maintain labor peace.”  All four men have pleaded not guilty.  They will have a tough time convincing a jury.   


Walker, Rasberry, Rabb and Mason, indicates the indictment, extorted money from a variety of contractors and workers at construction sites “under the guise of obtaining jobs for minorities.”  Affected sites included the City’s massive $6 billion, 60-mile-long Water Tunnel Number Three, a Queens subway station, and various public-school and private-development projects.  Walker and other coalition members used physical violence and threats of physical violence against contractors and their employees to extort various “labor-peace” payments; Walker alone made at least $1 million over a four-year period.


Intimidation was the name of the game, and the defendants played in top form.  In one instance, Walker, 42, and his lieutenant, Rasberry, 48, used what appeared to be a gun to threaten a principal of an Asian-American-owned construction company doing contract work on five public schools in Brooklyn, Queens and the Bronx, forcing the firm to pay $500 a week for a no-show job.  Walker also frequently forced illegal immigrants seeking work to use one of four Social Security numbers under his name to work at Local 731 projects.  Walker skimmed weekly payments of $100 to $200 per worker, all the while “earning” union retirement and other benefits.  When not menacing the innocent, the gang practiced the art of deception.  Walker allegedly used three phony Social Security numbers to collect $48,000 in unemployment benefits, and tried to avoid paying $132,000 in compensation premiums for the workers in a “business” he created.  After the New York State Insurance Fund audited the business, Derrick Walker created a new company, claiming to be an unrelated person who happened to have the same last name.


The scheme began to unravel after a Brooklyn contractor reported a pair of incidents that occurred on June 23 and June 25, 2004.  The defendants and some coalition members had gone to the construction site and threatened the foreman.  The foreman in turn contacted the district attorney’s office.  Not long after, an undercover investigator contacted Walker and Rasberry, and arranged to meet them.  It was the start of a successful sting.  The D.A.’s office set up the investigator with a business front in Manhattan called City-wide Consulting Services.  “At one meeting, the undercover discussed with the defendants how to ensure labor peace at the Brooklyn site,” said the D.A.’s office.  “The defendants suggested a weekly payment of $300 (per worker).”  The investigator negotiated the payment down to $200, subsequently meeting with the defendants on a monthly basis and paying $800 per worker.  In one case, the defendants got an illegal Caribbean immigrant worker a job, and then forced him to hand over $100 a week.  The worker later found another job on his own, but continued to pay after Walker and Rasberry had threatened him.             


Rabb, 39, and Mason, 41, were busy as well.  In December 2005, stated the district attorney’s office, the pair and 15 other persons visited a project in the Brownsville section in Brooklyn, and “shut down the work site, blocked entrance and exit gates, and permitted no workers or machinery on the site.”  They forced the contractor to hire an unneeded bricklayer who kicked back part of his wages, and forced the contractor to hand over $500 a week to ensure “labor peace.”  In another case, Rabb and Mason threatened to kill a worker who left a racket-controlled construction site and got a job on his own, sending down two thugs to assault him to show they meant business.  As part of the sting, the D.A. convinced the worker to allow the defendants to extort him.  Most brazenly of all, on June 16, 2005, Rabb and Mason, assisted by “coalition” members, shut down work at Water Tunnel Number Three by disconnecting a generator used for welding inside of the shafts.


Eventually, the cops gathered enough evidence to make arrests.  If convicted, the defendants face maximum sentences of 25 years for enterprise corruption, 15 years for grand larceny, seven years for attempted grand larceny, four years for scheming to defraud, and four years for offering a false instrument for filing.  While justice hopefully will be swift and certain, the role of the affirmative action principle in all this should not go unmentioned.  None of these outrages likely would have happened in lieu of the City of New York’s minority-hiring program.  Extortion in the name of civil rights (with public scorn and lawsuits potentially facing businesses not complying) is an old con game.  Remember, Jesse Jackson started his political career in much the same way nearly 40 years ago, running a crew that shook down small businesses on the south side of Chicago.  To generalize from this one particular New York City case may seem presumptuous.   On the other hand, recent history, in the U.S. and elsewhere, has taught us more than once that a political culture of racial favoritism encourages the worst people to seek unearned advantages, and often by any means necessarily.  When it comes to reforming affirmative action, the motto should be:  “End it, don’t mend it.”  (Bureau of National Affairs, Construction Labor Report, 9/20/06; Staten Island Advance, 9/14/06).