Business / Government

Integrity Commission Rapped

Ben Shanahan

Ian MacGregor, owner of The Lobster Place on Bryant Avenue, says the City’s Business Integrity Commission is squeezing his and other business with strong-arm tactics.

Business owners cry foul as city increases scrutiny

A city government commission founded to combat organized crime is instead operating a shakedown operation, business owners charge.

Businesses in and around the Hunts Point wholesale food markets say the New York City Business Integrity Commission (BIC) has become an agency run amok, aggressively enforcing bureaucratic rules, charging high fees and leveling crippling fines.

“I believe the BIC has a fundraising motive,” said Ian MacGregor, president and chief fishmonger at The Lobster Place, at 531 Bryant Avenue. MacGregor has been fined $15,000 for breaking BIC rules, and is concerned about the rising costs of being registered with the agency.

A spokesman for the BIC defended the agency, saying, “Our regulations ultimately protect the interests of legitimate operators and their employees.”

Established in 2001 as the “Organized Crime Control Commission,” the BIC’s job is to curtail the influence of organized crime in the wholesale food markets and private waste-hauling industry, and to regulate shipboard gambling.

In 2009, a court order required the agency to expand the area it oversees from the markets themselves to most of Hunts Point, with its many food businesses. Companies in the zone must register with the BIC, and their proprietors and employees must pass a background check.

Each business must pay $4,000 to register with the commission, which then issues ID cards to each employee, at a cost to their employer of $100 per card.

The agency, noted BIC spokesman Jay Kairam, has forced three Hunts Point companies with ties to the Genovese crime family out of business in the last two years.  Those cases, he said, “clearly justify how and why we are doing this.”

MacGregor says the BIC has suddenly begun to target him with intensive scrutiny of his business practices and personal affairs. He says the recent attention marks the first time he has been subjected to government oversight since he moved to Hunts Point in 2008.

MacGregor says he didn’t know he was obliged to register with the BIC, and he complains that when an agent showed up last February to notify him, he wasn’t there. If the goal was to register the business, not to fine it, he argues, the agent should have told him he was coming and made sure he would be there.

Though he ultimately pled guilty to the violation, MacGregor disagrees with the principle.

“As a private citizen operating a private business on private land,” he said, “I don’t understand why I have to be registered with the BIC.”

After paying his fine, he began what he called the “long and intrusive” application process. While he was doing the paperwork, he said he was assessed another two fines for being unregistered with the BIC, the first for $5,000 and the second for $7,500.

According to a BIC official, who spoke on condition that he not be named because he was not authorized to speak on the subject, typically, fines issued for being unregistered are forgiven once the business completes the application process.

Once a business is registered, each employee must receive an ID card, at a cost to the business of $100 each, adding another $5,000 to the Lobster Place’s cost, according to MacGregor.

MacGregor is not the only business owner who calls the BIC’s investigations intrusive.

“When I went to immigration services to enter this country, the questions they asked me weren’t as invasive as the questions asked by the BIC,” said Ramon Eduardo, an immigrant who has been operating his Il Forno Bakery at 521 Faile Street for eight years.

Eduardo also said that his employees are alarmed by the requirement that they submit to background checks and be issued BIC identification cards.

“Some of my employees say they won’t answer the questions,” Eduardo said. “They are afraid.”

Eduardo says the commission has asked him to disclose personal tax information and information about his wife—information he feels is unrelated to commercial activities by his bakery.

The BIC says that checks on family members are important to ensure criminals do not use their relatives as fronts.

Both Eduardo and MacGregor said this recent round of inspections and fines mark their first encounter with the BIC. The BIC attributes the delay in checking on the local businesses to its case load of 2,000 businesses citywide.

“BIC’s role is intended to ensure a safe, fair and competitive environment for businesses operating in the Hunts Point Markets and the immediate surrounding area,” said Kairam.

In order to achieve that goal, MacGregor claims, “The burden has largely been on me, my administrative staff and my wallet.

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