MANHATTAN (CN) - Federal prosecutors charged six people with bilking New York City of millions of dollars as the cost of a so-called modernization of its payroll system ballooned from $63 million to more than $700 million. Mark Mazer, manager of the CityTime project, is accused of leading the scam by having the city hire "dozens" of "consultants," from whom he demanded kickbacks "totaling approximately 80 percent of the net revenue generated by the subcontractors."
The 7-count indictment accuses Mazer of demanding kickbacks from vendors to the Office of Payroll Administration, to enrich himself, his family members and cronies.
The indictment also names Dimitry Aronshtein, Svetlana Mazer, Larisa Medzon, and Anna Makovetskaya as defendants.
The 32-page indictment claims Mazer ran the scam from 2005 to 2010, "to illegally enrich himself and his family members by demanding kickbacks from OPA vendors, defrauding the city in various other ways, and working with associated to launder the proceeds of the criminal scheme, and thereby exposed the city to millions of dollars in financial losses."
The heart of Mazer's scheme was to cause "the city to hire dozens of new consultants to perform the work called for by the contract amendments. ... Mark Mazer than solicited millions of dollars in kickbacks - totaling approximately 80 percent of the net revenue generated by the subcontractors - from Dimitry Aronshtein, the defendant, who owned DAS [D.A. solutions, a staffing company sub-subcontractor], and Victor Natanzon, who owned Prime View [another sub-subcontractor], from the revenue generated by these new consultants," according to the indictment.
Natanzon is the sole defendant in a separate, 4-count criminal information.
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