NGG National Grid Plc New

By Thomas MacMillan 

Brooklyn landlords looking to quickly cash in on a booming real-estate market found a way to bypass a lengthy building inspection process: call on a "shadow utility company" set up by a former National Grid employee to install illegal gas lines, authorities said.

That former employee, Weldon "Al" Findlay, appeared in Brooklyn Supreme Court Thursday morning, accused of being the head of an alleged conspiracy to sell illegal gas connections to unscrupulous landlords and property managers in Brooklyn and Queens.

Mr. Findlay, 47 years old, pleaded not guilty to a charge of enterprise corruption as well as to 64 counts of falsifying business records, 41 counts of commercial bribery, and 23 counts of criminal tampering.

Authorities charged 36 others -- including seven former National Grid employees and 26 landlords, property managers and contractor -- as part of the alleged conspiracy, said Acting Brooklyn District Attorney Eric Gonzalez and Department of Investigation Commissioner Mark Peters.

National Grid, an electricity and gas company, supplies gas to New Yorkers. It said the alleged misconduct was limited to a handful of people whom the company no longer employed. It said it was conducting "a thorough internal investigation" and working closely with its regulator.

"This group infiltrated a public utility and threatened the well-being of unsuspecting Brooklyn residents in an effort to line their own pockets," said Mr. Gonzalez, the acting district attorney.

During a six-month investigation in 2016, authorities using surveillance and wire taps found conspiracy members installed illegal gas meters at 33 residential buildings, mostly in Brooklyn but also in Queens, Mr. Gonzalez said.

Prosecutors said Mr. Findlay, who was fired from National Grid in 2010 for leave abuses, would charge landlords an average of $1,500 for installation of illegal gas meters. He allegedly worked with a National Grid customer-service representative named Phoebe Bogan, who also pleaded not guilty to charges of corruption, falsifying records, bribery and tampering on Thursday.

Mr. Findlay's lawyer, Stephen Zeitlin, said his client had no previous arrests and was the married father of two young children and the son of a pastor. He said Mr. Findlay owns a small carwash business and delivers school lunches and voluntarily turned himself in Thursday morning. "There is no harm done to anyone from what he's alleged to have done," Mr. Zeitlin said.

Ms. Bogan's lawyer, Lance Lazzaro, said the 41-year-old has no criminal record, is the mother of an 8-year-old boy and voluntarily turned herself in early Thursday morning.

Ms. Bogan would open new accounts for the landlords without proper approval and dispatch utility technicians involved in the scheme to install meters, according to prosecutors. Landlords were able to receive gas service while avoiding permitting and inspection by the Department of Buildings or a licensed master plumber.

"It was a relatively simple scheme, but it was very lucrative for the people involved in it," Mr. Gonzalez said.

"We believe hundreds of thousands of dollars exchanged hands," Mr. Peters said.

Mr. Peters said authorities inspected all gas meters installed as part of the alleged scheme and found several violations, including the use of cheap plastic piping of the kind that was used at the gas line that exploded in the East Village in 2015, killing two.

Mr. Peters said the construction boom in the city has been accompanied by "a troubling increase in corruption." The gas-meter investigation grew out of another investigation into alleged bribery of Department of Buildings employees staff, he said.

(END) Dow Jones Newswires

January 12, 2017 18:08 ET (23:08 GMT)

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