The once top-ranking NYPD officer, former Chief of Department Philip Banks, has avoided being charged in a corruption scandal that shook the entire department, despite the FBI uncovering $300,000 in transaction on his bank records, which the feds called the key signs of “money laundering.”
According to a sworn affidavit filed in Manhattan federal court, surveillance photos were recovered in the FBI’s investigation; some of which show Banks making some of the questionable deposits, while other photos show “at least one other person, whom the FBI has not been able to identify, making deposits into these accounts.”
In the filed affidavit, FBI Special Agent Joseph Downs wrote, “The investigation has not uncovered any legitimate source for this income in BANKS’s or his spouse’s accounts, which far exceeds both his NYPD salary and the rental income he received from properties he owns, and which also far exceeds his spouse’s salary as a nurse.”
This sworn affidavit was filed as parts of an application for a cellphone wiretap, which was approved on October 30,2014. The following day, Banks announced his retirement from the NYPD after he suddenly declined a promotion to first deputy commissioner.
Back at that time, Banks said he rejected the new job position, because it “would take me away from where I could make the greatest contribution: the police work and operations that I love so much.”
According to Downs affidavit, included in the mysterious transaction were “numerous accounts” created between 2007 and 2013, and controlled by Banks and his wife, Vonda Smith.
The Post reports, “During that time, Banks served as executive officer of Patrol Borough Brooklyn South, commander of Patrol Borough Manhattan North and chief of community affairs before his 2013 promotion to chief. Banks’ annual salary in that post was $201,096, payroll records show. His cash deposits and withdrawals were often made in ‘small increments,’ according to the affidavit, which cites seven deposits, ranging from $520 to $1,200 each, that Banks made on four dates between Aug. 26 and Nov. 3, 2013. Someone else also deposited $1,540 and $60, respectively, into two of Banks’ accounts on Sept. 8, 2013, the affidavit says.”
Downs wrote in the affidavit the other evidence paired with the “volume and pattern” of the banking activity, “is indicative of the Subject Offense of money laundering.”
He said, “Specifically, based on my training and experience, and participation in this investigation, I know that individuals who wish to conceal the illegal sources of financial proceeds often make efforts to conceal those proceeds by engaging in financial transactions with banks or by having third parties engage in such transactions that hide the true source of the proceeds of unlawful activity.”
The affidavit written by Downs was one among five or more that were submitted as part of a wide-reaching investigation to judges. The probe ended up uncovering former Harlem restaurant owner Hamlet Peralta’s $12 million Ponzi scheme. Last year, Peralta pled guilty to wire fraud and is currently serving a prison sentence of five years.
While the exact date that the federal probe into Banks began is unknown, in August 2014, the Manhattan US Attorney’s Office asked the IRS to join the investigation citing the “unexplained cash deposits into the accounts of Banks and his wife,” according to a filing on January 10, 2015.
Over $245,000 in rent paid by tenants at several Queens properties that Banks family owned, were revealed as unreported income separate from the money in the mystery transactions.
Despite continued mounting evidence against Banks regarding misappropriated and unreported funds, officials said that prosecutors “did not feel they had anything that could stick in court and convict Banks.” An official said, “At the end of the day, they felt that it’s very easy to get an indictment but you have to prove it in court.”