Former Adams Chief Of Staff Arrested For Bribery Over Hotel Migrant Shelter Contract

Former Mayor Eric Adams’ chief of staff was taken into custody Wednesday morning after being indicted on federal bribery charges for allegedly exploiting the city’s migrant crisis. 

FBI agents arrested Frank Carone and his brother Anthony Carone, alongside Chinese developer Andy Zhu and his business manager, Crystal Chen.

Federal prosecutors accuse Frank Carone of accepting a series of bribes in exchange for steering a $6.8M emergency shelter contract to Zhu’s Microtel Inn in Long Island City. Over nearly a year, the developer wired a total of $120K to an account controlled by Anthony Carone, according to the unsealed indictment.

Frank Carone served as counsel to the Democratic Party in Brooklyn, aiding Adams in his rise from state senator to borough president and, ultimately, mayor. Frank Carone joined City Hall when Adams was first appointed in 2022, though he only served in the role for a year. 

Frank Carone’s attorney, Arthur Aidala, didn't immediately respond to Bisnow’s request for comment. In a statement to CBS News, Aidala called the indictment “weak” and “based on purely circumstantial evidence that's not worth the paper upon which it's printed.”

“Today's indictment is a sad day for our criminal justice system,” Aidala said. “It epitomizes the Government first finding a target and then spending three years and enormous taxpayer resources to find a crime.”

The defendants were indicted on 13 counts, including bribery, wire fraud, money laundering and obstruction of justice.

In court filings, prosecutors said the scheme between the defendants took place between June 2022 and December 2023. 

At the time, New York City was in the middle of a massive influx of migrant asylum-seekers. In response, the city rented hotels to house migrants, spending billions of dollars in federal grant money on no-bid contracts to property owners.

Zhu applied to the city’s emergency shelter program several times, but officials from the Department of Social Services deemed the location not a fit, according to prosecutors. Long Island City hotels had already received several contracts, which drew backlash from residents and cautioned officials from opening new shelters in the area.

The developer allegedly decided to leverage his burgeoning personal relationship with Frank Carone, hosting the mayor’s top aide at several gatherings at his home on Long Island.

In texts released in court filings, Zhu asked for Frank Carone’s assistance. On Sept. 26, 2022, two days after the duo was pictured partying together, Zhu wrote, “Please help me get done we need to refinance.”

Two days later, on Sept. 28, Zhu allegedly met Anthony Carone at a Manhattan social club. Then, on Oct. 1, 2022, Zhu visited Frank Carone’s Brooklyn home, according to court records.

That is when monthly payments started rolling into the account controlled by Anthony Carone, prosecutors allege. Zhu and Chen allegedly claimed the payments were legal fees — though none of the money was reported to the IRS or the New York City Conflicts of Interest Board. 

The money was then funneled to Frank Carone in various ways, including through payments to his personal credit card, according to the indictment. The funds were allegedly used to pay for expenses like travel, dining, fitness memberships and clothing purchases.

In texts between Chen and another one of Zhu’s employees, the unnamed person refers to the payments as “blackmail.”

“It’s all bullshit,” Chen wrote. “The two brothers got a bargain for nothing.”

DSS continued to oppose giving a contract to the hotel, located at 29-12 40th Ave. in Queens. At one point, an official said in an email that the location “is a proposed hotel conversion that has been brought to us many times … we have consistently told them no because it is directly next to [a different] shelter.”

In an email sent Oct. 4, 2022, a city official said “we’ve taken this as far as we can go. So nothing left to do. Thanks for humoring me.”

Eventually, on Oct. 11, 2022, a city hall official wrote to DSS staff that directions for giving Microtel a contract had “come directly from the top … I know it is in LIC, but we should assume it is approved.”

Soon after, Zhu was awarded the contract, superseding two other proposed hotels that were larger and could have sheltered more migrants, according to the indictment.

The payments allegedly stopped a year later, and texts reference a disagreement between Zhu and the brothers.

Adams and several other high-ranking officials in his administration have faced various criminal charges, many of which revolve around bribes from real estate developers. 

In September 2024, the mayor was indicted on five counts, including wire fraud and bribery. The Justice Department ordered prosecutors to drop the charges in February 2025.

Frank and Anthony Carone became aware of a federal grand jury investigation earlier. In July 2024, the brothers allegedly attempted to obstruct the payments made to them by Zhu by fabricating evidence that the transactions were personal loans. The brothers backdated documents that were then provided to federal investigators in October 2025.

Earlier this year, when the New York Times reported that Carone was under investigation, he denied wrongdoing. In a statement, he attributed any scrutiny to jealousy over his success and “stereotypical assumptions” based on his Italian American and Brooklyn background, adding that “baseless accusations are nothing new to me.”

“Anyone and everyone who actually knows me and has worked alongside me would say that I am conscientious and principled in how I comport myself and all that I do,” Carone said.

On Wednesday, a spokesperson for Adams defended the former chief of staff.

“Frank Carone has dedicated decades of his life to public service, the legal profession, and helping countless individuals, businesses, and charitable organizations throughout New York,” the spokesperson said in a statement. “This is an ongoing legal matter and my prayers are with his family.”

Other power players who have been indicted include Adams' former chief adviser, Ingrid Lewis-Martin, and former Department of Citywide Administrative Services Deputy Commissioner Jesse Hamilton.

Former Department of Buildings Commissioner Eric Ulrich was accused of accepting or soliciting more than $150K in bribes while holding government positions in September 2023. He will face trial in September.

Earlier this year, four others were indicted on bribery charges surrounding migrant shelter contracts. A related corruption investigation, potentially involving a councilwoman and an aide to Gov. Kathy Hochul, is ongoing, according to The New York Times.