Federal prosecutors have announced bribery and corruption charges involving former New York City official Frank Carone, his brother Anthony Carone, developer Yan Po “Andy” Zhu, and hotel business manager Crystal Chen. The indictment alleges the group conspired to steer a $6.8 million city contract for a temporary migrant shelter to a hotel owned by Zhu, in exchange for monthly payments disguised as retainer fees funneled through Anthony Carone’s law firm.
According to the indictment, beginning by October 2022, Zhu and Chen made monthly payments of $10,000 to Anthony Carone’s firm, totaling $120,000. Prosecutors allege that Frank Carone used his position to influence city agencies responsible for awarding emergency shelter contracts, despite internal warnings that the selected hotel was not the most suitable location. The shelter reportedly housed fewer migrants than alternative sites and required additional city resources.
Authorities say Frank Carone and his brother failed to report these payments on their 2022 tax returns. Once under investigation, Frank Carone amended his returns to include fabricated payments. Zhu is also accused of obstruction of justice—when agents tried to unlock his phone during a search, he reportedly prevented access by covering his face and making evasive gestures.
All four appeared in federal court and were released on bonds. Frank Carone secured release by posting his $4.7 million Florida mansion to cover a $2 million bond; Zhu was released on an $8 million bond. Each faces multiple charges including conspiracy, federal program bribery, honest services wire fraud, money laundering, obstruction of justice, and false tax return filings, with potential sentences of up to 20 years in prison if convicted.
Carone’s attorneys Andrew Goldstein and Russell Capone criticized the charges as “utterly misguided,” asserting that Frank Carone played a vital role in managing the city’s migrant crisis but was not involved in the shelter contract decisions central to the allegations. An attorney for Frank Carone described the indictment as a “Frankenstein indictment,” while Carone himself called earlier reports of an investigation “baseless” and suggested he was politically targeted.
Zhu and Chen have made campaign contributions to ex-Mayor Eric Adams, who left office at the end of 2025 amid his own federal indictment and a series of corruption scandals. Zhu gave $2,100 to Adams’ 2023 re-election bid and $2,000 to his 2021 campaign; Chen contributed $250 in 2021. Adams' spokesperson acknowledged the seriousness of the allegations and emphasized the importance of maintaining high standards for public servants.
This case emerges amid a broader investigation that also touches on misconduct within the New York Police Department, including probes related to former Chief of Department Maddrey and allegations of improper promotion practices and overtime fraud. Former NYPD officials have been subjects of related searches and inquiries, with an ongoing multi-front federal and local investigation into corruption and misconduct in city government circles.
As the legal proceedings move forward, the defendants and their representatives maintain their innocence, while prosecutors continue to review evidence regarding the misuse of public funds and abuse of official positions during a critical response to the city’s migrant crisis.