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Platinum hedge fund co-founder pleads guilty in corruption case

[NEW YORK] A founder of the hedge fund firm Platinum Partners pleaded guilty on Friday to a criminal conspiracy charge, six months after a mistrial in a corruption case against him and a former New York City labour leader.

Murray Huberfeld, 57, of Lawrence, New York, entered his plea before US District Judge Alvin Hellerstein in Manhattan.

The plea followed jurors' deadlock last Nov 16 on fraud and conspiracy charges against Mr Huberfeld and Norman Seabrook, who led the Correction Officers' Benevolent Association, the largest US municipal jail union, for more than two decades.

Prosecutors accused Seabrook of accepting a US$60,000 kickback from Mr Huberfeld in exchange for steering US$20 million of union money to invest with Platinum.

They said Mr Huberfeld used a fake invoice to disguise that payment as being for tickets for courtside seats at New York Knicks basketball games.

The payment was made through former real estate developer Jona Rechnitz, who testified for several days against Huberfeld and Seabrook on behalf of the US Attorney's office in Manhattan, which handles many municipal corruption cases.

Huberfeld faces a possible six- to 12-month prison term at his Sept 14 sentencing. His plea agreement does not require his cooperation with prosecutors in their case against Seabrook.

"Murray Huberfeld is ready to put this chapter behind him," and "looks forward to returning to his friends and family who know Murray as a man of high character and most generous heart," his lawyer Henry Mazurek said in an email.

Mr Seabrook is preparing for his July 30 retrial, his lawyer Paul Shechtman said in a phone interview.

"At the first trial we argued that the US$60,000 payment to Mr. Rechnitz was inappropriate, so I'm not surprised by today's plea," Shechtman said. "I respect Mr Huberfeld greatly for admitting what he did, and for not admitting what he didn't do. Implicit in this plea is that he did not pay a bribe to Norman Seabrook."

Mr Mazurek and Mr Shechtman had assailed Mr Rechnitz's credibility at the trial, highlighting his admitted history of dishonest dealings with city officials.

Mr Rechnitz also testified that he had close ties to New York City Mayor Bill de Blasio, for whom he raised money.

The mayor has repeatedly denied that Mr Rechnitz had any corrupt influence, and has not been accused of wrongdoing.

Platinum began closing its funds after Mr Huberfeld's arrest in June 2016.

Six months later, prosecutors charged another Platinum founder, Mark Nordlicht, and six others in a US$1 billion case over two alleged fraud schemes. Mr Nordlicht and the other defendants have pleaded not guilty.


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