Monday, May 3, 2010

Fed Probe Shows Senate President Malcolm Smith Ripped Off Elderly Couple for $60,000 by Barbara Ross, Robert Gearty and Greg B. Smith - NY Daily News

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Senate President Malcolm Smith ripped Cora Wheeling, 70, and her husband off, cheating them of over $60,000. Farriella, DelMundo for News

Senate President Malcolm Smith ripped off an elderly Queens couple he'd promised to build a dream house for in a land deal under scrutiny by the FBI, the Daily News has learned.

Cora Wheeling, 70, and her husband, Eddie, 71, wound up with no home to show for the $88,200 they put down toward a split-level Smith claimed he'd build them.

They sued in 1998; Smith still owes them more than $60,000.

"I didn't know he's a rat," an irate Cora Wheeling said. "I should have known better."

The house was supposed to be part of a subdivision Smith was trying to build on 230th St. in Cambria Heights. That deal is at the center of an expanding federal probe, sources said.

The FBI is also looking at why Smith got a steep discount from an architect hired for a job at that same address. The architect then got work at nonprofits Smith has funded with taxpayer dollars.

Investigators want to know if Smith used his influence as an elected official to benefit himself financially, a possibly criminal conflict of interest.

"Every day it's something else, but these investigators are chasing their tail," said Smith's lawyer, Gerald Shargel. "Malcolm Smith did nothing wrong."

For the Wheelings, Smith's behavior was worse than a mere conflict of interest.

In August 1997, the retired hostess from the old Shea Stadium Diamond Club and her car mechanic husband put down money she won in a medical malpractice suit toward the construction of a $316,000 split-level.

The house was to include two fireplaces, a garage and gold bathroom fixtures. Smith promised to obtain permits right away. He did nothing, and by October 1998, the couple sued.

Smith's partner and lawyer, Joan Flowers, argued the Wheelings were in breach of contract.

A judge rejected that claim. The case was settled in May 2001, with Smith agreeing to pay the Wheelings $63,000. The first check bounced.

A year later, Flowers asked to extend the repayment because, among other reasons, the Sept. 11 terrorist attacks had hurt Smith's pocketbook. The judge extended it, but upped the total to $66,000.

The Wheelings wound up buying a home on Long Island.

As of last week, Smith still owed the Wheelings more than $60,000 - which infuriates Cora Wheeling every time she hears reports about corruption in Albany.

"I get angry every time I see him on TV," she said. "I don't want to see him getting paid by taxpayers."

Architect Robert Gaskin also wound up not getting everything Smith promised on the same 230th St. subdivision - but it apparently worked out for him in the end.