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Councilman McFadden charged with money laundering, wire fraud of Rochester Housing Authority funds

Feb 22, 2019

From left, Assistant U.S. Attorney Richard Resnick, U.S. Attorney James Kennedy and FBI Special Agent Gary Loeffert.
Credit Caitlin Whyte / WXXI News

Rochester City Councilmember and Council Vice President Adam McFadden was charged in federal court this morning with four counts of wire fraud, conspiracy and money laundering involving the Rochester Housing Authority and Rochester Housing Charities.

Housing Authority Chairperson George Moses was arrested on similar charges four months ago. He was accused of lying to the FBI in its investigation.

"In a nutshell, the defendants caused the Rochester Housing Charities, which was created to advance the purposes of the RHA, to enter into a contract that would secretly benefit Mr. McFadden," said Gary Loeffert, the FBI special agent in charge of the case.

  

The complaint alleges that between October 2014 and December 2015, Rochester Housing Charities entered a contract with Washington, D.C.-based Capital Connection Partners for consulting services. But services under the contract were never performed. 

Authorities said the investigation is ongoing.

City Councilman Adam McFadden said Friday that he has "faith that my hard work speaks for itself, and I’ll continue that."
Credit File photo

The two counts of wire fraud hold a maximum penalty of 20 years in prison each. The two counts of money laundering hold up to 10 years each.

U.S. Attorney James Kennedy said it’s a sad day, charging an elected official with committing a federal crime

"My caution to politicians in our community, in Rochester and throughout the western district of New York: You are elected to serve. And if you fail to serve, and decide to take, you will be charged," Kennedy said.

McFadden spoke to reporters outside the courthouse. He said he will not stop advocating for people in his district while this case proceeds through the courts.

"I have faith in God, I’m at peace with God and for me I put a lot of time and energy into this community and I will not stop doing that, working hard for my constituents," McFadden said.

He added he will not be hiding and that he has "faith that my hard work speaks for itself, and I’ll continue that."

Mayor Lovely Warren responded to the charges, saying, "No one is above the law and, if found guilty, they must be held accountable."

She went on to say that her first concern is for the residents served by RHA and remains committed to working with its leadership to provide safe and affordable housing.

The Rochester Housing Authority released this statement:

"The Board of Commissioners and Executive Team at Rochester Housing Authority (RHA) will continue to cooperate fully with this ongoing federal investigation regarding Rochester Housing Charities and defers all related questions to the US Attorney’s office or legal counsel for Mr. Moses and Councilman McFadden.

As always, RHA remains focused on our mission of providing quality housing opportunities and related services for our residents and program participants serving more than 25,000 lower-income families, seniors and disabled residents in the five-county Greater Rochester area.  RHA’s Board of Commissioners and Executive Team will continue to ensure that quality services remain uninterrupted."