This past summer, federal and local law enforcement agencies in New York City unsealed a two-count indictment charging nine individuals with racketeering and extortion in a conspiracy involving a restoration company.
According to the indictment, the defendants took control of First Response Cleaning Corp., a Brooklyn-based company that provides fire damage restoration. The defendants used First Response as a vehicle to extort other fire mitigation firms and to assert control over the industry using violence and threats of violence.
“We allege gang members deployed mob-like tactics, using extortion and violence in their attempts to take over an entire industry designed to help victims after a fire,” said FBI Assistant Director Michael J. Driscoll. “They employed violence to force other companies and vendors to do their bidding.”
According to the indictment and statements made in court filings, eight of the defendants worked together to take control of First Response in 2019. The defendants are: Jatiek “Tiek” Smith; Sequan “Supa” Jackson; Anthony “Touch” Mcgee; Kaheen “Biz” Small; Damon“Demo” Dore; Hasim “Hoodie” Smith; Rahmiek “Ready” Lacewell; and Manuel “Manny” Pereira, a/k/a “Manny.” Law enforcement agents said many of the men are members of the Bloods street gang; Smith was the leader of the crew.
The Bloods are a street gang that started in Los Angeles, and grew to prominence in the 1980s as a major purveyor of crack cocaine. Proceeds from the drug sales were used to expand across the country, with the East Coast version forming in the 1990s.
After taking control of First Response, Smith and the others allegedly used force and threats against other restoration companies and public adjusters to exert control over parts of the fire mitigation business in New York City. Defendant Octavio Peralta was a public adjuster who is accused of participating in the enterprise’s efforts to defraud and who helped the conspirators solidify their control.
The enterprise’s threats included threats to kill or shoot their victims and members of the victims’ families. With the backing of these threats, law enforcement agents said, they imposed a system of rules upon other restorers and on public adjusters. These included a strict rotation system in which the defendants dictated which companies got which losses.
The enterprise also extorted money from restoration companies and public adjusters and required these other companies to pay if they wanted to continue to work without being attacked. On multiple occasions, the indictment states, the enterprise used force against other restoration companies and public adjusters to ensure that they submitted to the rules, including physically assaulting victims. They sometimes created video recordings of this violence and distributed the recordings within the industry to threaten other victims.
The enterprise also helped submit false insurance claims for damaged properties. They allegedly threatened violence or retaliation against potential witnesses who were believed to be cooperating with the federal investigation into the enterprise’s crimes.
According to media reports, residents of one fire-damaged apartment building said their homes were burglarized after First Response crews started working on the site.
“This criminal organization took advantage of people in time of personal and professional turmoil to enrich themselves at others expense,” said Ricky J. Patel, acting special agent-in-charge of the New York Office of Homeland Security Investigations.
HSI became involved because Smith was arrested in Puerto Rico.
All nine defendants are charged with one count each of conspiracy to commit racketeering and one count of conspiracy to commit extortion. Each count carries a statutory maximum of 20 years in prison, for a combined statutory maximum of 40 years in prison. Any sentencing of the defendants will be determined by the judge. The charges contained in the indictment are accusations, and the defendants are presumed innocent unless and until proven guilty
This case is being handled by the Violent and Organized Crime Unit of the office of the United States Attorney for the Southern District of New York.
