By Joseph Ax and Nate Raymond
NEW YORK (Reuters) - A wide-ranging corruption probe in New York City led to charges on Monday against three police officials and a businessman who prosecutors say schemed to secure favors in exchange for $100,000 in gifts including prostitutes, sports tickets and trips.
Their arrests on charges filed in Manhattan federal court marked an escalation of a probe that has also been examining the fundraising of Mayor Bill de Blasio, whose inaugural committee counted the businessman, Jeremy Reichberg, as a member.
A criminal complaint said Reichberg, 42, and a real estate investor, Jona Rechnitz, provided lavish benefits to top New York Police Department officials, including Deputy Chief Michael Harrington and Deputy Inspector James Grant.
In exchange, prosecutors said, Reichberg and Rechnitz had Grant, 43, and Harrington, 50, on call to provide police escorts, special access to parades, the ability to get out of tickets and help with gun license applications.
"They got, in effect, a private police force for themselves and their friends," Manhattan U.S. Attorney Preet Bharara told a news conference on Monday.
Prosecutors said Reichberg, who is affiliated with a company called JR Consultants, and Rechnitz supplied a litany of bribes for favors from 2012 to 2015.
David Villanueva, a sergeant, was also charged for accepting bribes to expedite gun license applications for Alex Lichtenstein, a member of a volunteer safety patrol in an Orthodox Jewish neighborhood in Brooklyn who was charged in April.
A fifth officer, Richard Ochetal, secretly pleaded guilty on June 14 to his role in that fraud and has assisted prosecutors in the cases against Grant, Harrington and Villanueva, 42, according to prosecutors and court records.
Police Commissioner William Bratton compared the cases to past corruption scandals at the department, most prominently a 1970s bribery investigation by a panel known as the Knapp Commission.
While the latest probe had not revealed the type of systemic corruption revealed at that time, Bratton said it nonetheless "shows, whether you're a cop or a chief, if you break the law you'll be handled the same way."
Grant, Harrington, Villanueva and Reichberg were released on bail following court appearances on Monday. Villanueva pleaded not guilty. The other defendants did not enter pleas, but their lawyers said they committed no crimes.
"We believe there was no unlawful conduct and we'll proceed accordingly," said John Meringolo, Grant's lawyer.
The case stemmed from one of several overlapping state and federal investigations that have led to about a dozen police officers being disciplined and to scrutiny of De Blasio's fundraising.
Reichberg and Rechnitz served on de Blasio's inaugural committee after his 2013 election. Both men raised money either for his campaign or for a nonprofit set up by de Blasio advisers to advance his agenda.
De Blasio has not been accused of wrongdoing and has repeatedly said he and his administration have acted legally.
Monica Klein, a spokeswoman for de Blasio, in a statement said the mayor "is fully supportive of these investigations" and is committed to ensuring the NYPD maintains the public's trust.
Monday's arrests came two weeks after federal prosecutors charged Norman Seabrook, president of the city's correction officers union, and Murray Huberfeld, a hedge fund financier, as part of the same investigation.
That case, like the latest charges, came after prosecutors secured a secret guilty plea by Rechnitz, who is now cooperating with authorities in both cases, people familiar with the matter have said.
Susan Necheles, Reichberg's lawyer, said he committed no crime and his only mistake was befriending Rechnitz, "who is desperately trying to get others in trouble in order to curry favor with prosecutors and save his own skin."
Alan Levine, Rechnitz's lawyer, responded: "Jeremy Reichberg is responsible for his own conduct just as Jona Rechnitz was for his."
Prosecutors said Grant called Reichberg and Rechnitz the "two elves," after on Christmas in 2013 they gave his children a video game system and his wife jewelry while wearing elf hats.
Earlier that year, Reichberg and Rechnitz arranged for a prostitute to travel on a private jet and spend Super Bowl weekend in Las Vegas with a group that included Grant, who "took advantage of her services," the complaint said.
Harrington, meanwhile, received private security work worth tens of thousands of dollars for a company he unofficially helped manage, hotel rooms for a family trip to Chicago and sports tickets, prosecutors said.
(Reporting by Joseph Ax; Editing by Nick Zieminski and Dan Grebler)