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Additional Dregs of Steve Levy’s Past Scooped Up By Daily News

April 12, 2010

Forget being green.

It’s not easy being a Democrat-Turned-Republican gubernatorial candidate. The headlines about Steve Levy have been far from favorable in the two week, from bad poll numbers to a recently surfaced image of a turban-wearing, gun-wielding, pre-Suffolk County Democrat Levy.

Now, this story:

Self-styled reformer and gubernatorial hopeful Steve Levy once lived with an ex-con who copped a guilty plea in a mortgage fraud scheme involving dominatrixes and a SoHo S&M club.

Records show the Suffolk County executive, who recently dumped the Democratic Party to run for governor as a Republican, shared an address at 426 Raft Ave. in Holbrook, L.I., from October 2001 to April 2004 with Ethan Ellner, a title company owner and former lawyer who has had several run-ins with the law.

Levy owned the Raft Ave. house, which he bought in 1997 after temporarily separating from his wife, Colleen, sources close to the county executive say. The couple reconciled shortly before Levy’s first countywide run in 2003.

At the time Ellner was living in Levy’s house, he had already been convicted in 1997 on charges of federal tax evasion for which he was sentenced to one month in jail, three months of home confinement and three years of probation, records show.

That same year, Ellner represented Levy’s mother, Marie, in a suit she brought against the Internal Revenue Service. Ellner replaced another lawyer on the case, Louis D’Amaro, who is a Suffolk County legislator and close political ally to Levy. The suit was dismissed.

Ellner lost his law license in 1999 as a result of the conviction, but was reinstated in November 2001.

Ellner and Levy met at St. John’s University Law School, where they were friends, Levy campaign spokesman Josh Hills said. Ellner and Levy lost touch for several years, but reconnected when Ellner was going through a divorce and needed a place to stay, Hills said.

“Not only Steve, but a number of people in the community were giving [Ellner] a second chance,” Hills said. “He came back and he got back to practicing law.”

Hills described 426 Raft Ave. as a duplex and said Levy was on one side, while renting the other side to Ellner. A source familiar with the property described it as a small single-family house.

In March 2009, Ellner was indicted along with former Suffolk County legislator George Guldi, lawyer Dustin DenteDonald MacPherson and his wife, Carrie Coakley, on charges of running an $82 million mortgage fraud scheme that involved dozens of Hamptons properties.

MacPherson and Coakley own the bondage den Arena Studios and sponsor the annual Black and Blue Ball for S&M aficionados.

Prosecutors said they used dominatrixes to recruit patrons to participate in the mortgage scheme, which involved straw buyers who took out mortgages to “buy” property in tony Hamptons towns.

Ellner pleaded guilty last December to multiple felony counts of grand larceny, conspiracy and fraud and is now cooperating with Suffolk County DA Thomas Spota, a source familiar with the case said.

Hills said until Ellner’s latest round of legal troubles became public, Levy had neither knowledge of nor involvement in them – and hasn’t been in touch with him since his indictment.

The source said Levy introduced Ellner to Guldi, with whom Levy served in the Legislature.

Levy’s candidacy has been championed by state GOP Chairman Ed Cox, who has insisted Levy was fully vetted before party leaders drafted him to run.

Asked if Cox was aware of Levy’s connection to Ellner, party spokesman Alex Carey said, “Had this been something we came across in the vetting process, I doubt this would have caused us to think twice. How many degrees of separation are there before something becomes totally irrelevant to a person’s candidacy? I would argue that we’re there.”

***

The author of this piece is Elizabeth Benjamin, who is no longer blogmaster of The Daily Politics blog. While we’ve had some disagreements with her style in the past regarding the Brooklyn GOP and 44th City Council race, we wish her well in her future endeavors!

Meanwhile, we offer a big Atlas welcome to Celeste Katz, the new editrix of The Daily Politics blog. Much luck to you!

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3 Comments
  1. GENE BERARDELLI DRONES ON permalink
    April 12, 2010 4:53 pm

    Someone named Gene Berardelli is now writing for the Brooklyn GOP.

    That’s rich.

    I love how this Gene completely ignores the big problems in our local party addressed on this blog and goes on chatting about national issues, as though his and the Brooklyn GOP establishment’s opinions matter.

    It’s the equivalent of Nero playing the lyre as Rome burned.

    Not to mention, the website remains a hideous mess. Will someone please contact a plastic surgeon, because that image of Craig Eaton is scary.

    Not to mention, when I see the Brooklyn GOP website I feel like I’m reading Shelley’s Ozymandias:

    “My name is Ozymandias, king of kings:
    Look on my works, ye Mighty, and despair!”
    Nothing beside remains. Round the decay
    Of that colossal wreck, boundless and bare
    The lone and level sands stretch far away.

    Oh, despair is right! LOL

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