Frank Carone, former chief of staff to ex-Mayor Adams, arrested in alleged bribery scheme, prosecutors say

A onetime chief of staff to former New York City Mayor Eric Adams was arrested Wednesday by the FBI for allegedly steering a $6.8 million city contract to a hotel owner from Long Island to house an influx of foreign migrants, and in return received more than $100,000 in bribe money, prosecutors said in an indictment unsealed Wednesday.

Frank Carone, a prominent Brooklyn lawyer and longtime kingmaker who served as Adams' right-hand man during his first year in office, pleaded not guilty later in the afternoon at federal court in the borough to charges of bribery, wire fraud, money laundering conspiracy and more.

Carone's brother, Anthony Carone, of Queens, who is also an attorney; Yan Po Zhu, a Queens hotel owner who lives in Glen Head; and Crystal Chen, a Zhu employee who lives East Williston, also pleaded not guilty to multiple charges alleging they participated in the scheme.

Lawyers for the defendants said their clients are innocent.

“As two former federal public corruption prosecutors, we are confident that this prosecution is utterly misguided," Andrew Goldstein and Russell Capone said in a statement.  "Frank Carone served the City of New York honorably. He was instrumental in helping the city navigate an unprecedented migrant crisis, but had absolutely nothing to do with granting the temporary migrant shelter at the center of these charges.”

The defendants were ordered freed on bond — Frank Carone on $2 million, secured by property in Boca Raton; Zhu on $8 million, secured by property in Glen Head; Carone’s brother Anthony on $500,000; and Chen on $100,000.

Zhu was ordered to surrender his firearms to the Nassau County Police Department; his pistols have been surrendered, and his long guns have yet to be but will be soon, his lawyer Stephen Scaring told the court.

Prosecutor Sara Winik told the court: "The defendants engaged in a sweeping bribery scheme to exploit New York City migrant crisis for their own personal benefit….Frank Carone was entrusted to run our city's government but put his own wealth and status above duty.”

During the proceedings, which lasted less than an hour, Frank Carone leaned back in a swivel chair, his ankles crossed, occasionally appearing to joke with Goldstein.

Outside the courthouse, Arthur L. Aidala, another of Frank Carone’s lawyers, suggested the case could be retribution by prosecutors for the city criticizing the Biden administration’s handling of the migrant crisis.

“This started a long time ago, and there were a different administration,” Aidala said.

Asked about the fact the case was brought under President Donald Trump, Aidala said, "It's the same exact prosecutors. So are they still about something that we don't know? I don't know."  

Federal prosecutors alleged that between June 2022 and December 2023, Frank Carone, acting in his official capacity as chief of staff, contacted a top social service official to reconsider Zhu's hotel as a suitable location for an emergency migrant shelter after it had already been rejected, in part because a proliferation of such shelters in Long Island City had prompted complaints from residents.

The Microtel Inn by Wyndham, a 75-room hotel located at 29-12 40th Ave., was ultimately awarded an emergency shelter contract worth $6,825,000.

Prosecutors said the Carones concealed the bribe payments by directing them to a bank account controlled by Anthony Carone in the name of his law firm and by executing what prosecutors called a "sham retainer agreement" to make the alleged bribes to Frank Carone appear as legitimate legal fees paid to Anthony Carone’s law firm.

Anthony Carone then steered the majority of the funds paid into the law firm account to Frank Carone, including by paying Frank Carone’s personal credit card bills during the time he was Adams' chief of staff.

After Zhu, who socialized with Frank Carone, made the $120,000 in agreed-upon payments, Chen emailed Anthony Carone and asked to terminate the agreement, but Anthony Carone sought additional payments, prosecutors said.

Frank Carone later texted Zhu that he was “not happy” and would “not discuss [any future deals] until past is worked out.”

Prosecutors also accused the Carones of failing to report the income from Zhu's payments to the IRS in their initial 2022 tax filings, prosecutors said.

After the Carones came under federal scrutiny in 2024, they allegedly created a loan agreement document in an effort to explain the payments, prosecutors said.

Adams’ inner circle has been a target of multiple probes. Over a dozen people connected to him have been investigated, had their homes or businesses searched, been arrested, indicted or convicted in connection with suspected corruption, including his former top adviser, Ingrid Lewis-Martin, who is currently awaiting trial.

Adams has faced his own legal troubles. In 2024, he was indicted on charges of bribery, wire fraud, conspiracy and illegal campaign contribution in connection with what prosecutors said was a long-running scheme that involved Adams accepting travel upgrades and illegal campaign contributions from Turkish nationals in exchange for favorable governmental treatment. He denied the charges.

In a controversial move criticized by the trial judge and the case prosecutors, the Department of Justice, on orders from the Trump administration, dropped the charges last year — so that Adams could help with the migrant crisis.

Asked whether he hoped Trump would make the criminal case go away, Frank Carone said: “I'm just hoping to have a nice dinner tonight."