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Quartermaster Problems

Introduction
The "quartermaster" of the KWVA is that person who supervises the purchase and sale of items such as caps, jackets, pins, buttons, commemorative goods, etc. During the presidency of Nick Pappas, the quartermaster was John Maison of Fairview Heights, Illinois. During the presidency of Harley Coon, the quartermaster was Kenneth Cook of Danville, Illinois. During Maison’s tenure, as well as during a portion of Cook’s tenure, the quartermaster items were owned by the KWVA. At some point in time during Harley Coon’s presidency, Kenneth Cook acquired the KWVA quartermaster inventory in an unadvertised (until after the fact) transaction, and for a price not revealed to the KWVA membership. Cook, who is a member of the Executive Council of the KWVA, began to sell the quartermaster items as a private enterprise. Cook later wrote insufficient funds checks under the name "KWVA Quartermaster" on a private bank account, causing yet another fiscal scandal within the KWVA executive council.

From Southern to Central Illinois
Quartermaster problems are not new to the KWVA. From 1994 until 1997, John Maison of Fairview Heights, Illinois, served as the Quartermaster and Treasurer of the Korean War Veterans Association during the presidential tenure of Nick Pappas. He kept the quartermaster inventory in storage in Fairview Heights, on property rented from Clyde E. Blankenship. After the KWVA’s certified public accountant, Stan Myrda of Fairview Heights, Illinois, noticed that the financial records of the KWVA had unexplained discrepancies, Maison came under FBI and IRS investigation [see Maison Theft Incident found within KWVA News]. Maison was later indicted on 16 counts of wire and mail fraud.

Before the actual government-led investigation even started, KWVA officials took steps to eliminate Maison’s ability to access the organization’s funds and quartermaster supplies. On February 11, 1997, then President of the KWVA Nick Pappas, wrote to Blankenship stating that Stan Myrda had been authorized to change the locks on the property that housed the quartermaster supplies. Shortly thereafter, the Quartermaster inventory—which had a resale value of $143,000 (see July/August 1997 Graybeards, page 29), was moved from Fairview Heights to Danville, Illinois, by KWVA Director Kenneth Cook via three trucks. KWVA’s Imjin Chapter members Ed Musser and Jim Denham (now deceased) from the Fairview Heights/Belleville area, and other members from the St. Louis area, were enlisted to help with the move. "The stuff was all over the place," recalled one chapter member. "It was stacked from floor to ceiling." The 1997 income/expense statement in the March/April 1998 Graybeards shows an expense for $4,288.24 associated with the Quartermaster. According to Pappas, the amount was for the cost to rent the trucks to move the Quartermaster supplies from southern to central Illinois, with the remainder being back rent owned to Blankenship.

From 1997 until 1999, KWVA director and officer Cook served as the Quartermaster. During that time frame, quartermaster income and expenses were listed in financial statements posted in The Graybeards magazine.

Review of Quartermaster Income/Expenses
Source: The Graybeards

1997
Source: Korean War Veterans Association Income Statement
for the Twelve Months Ending December 31, 1997
March/April 1998 Graybeards, page 44

Revenues
Income - QM = $21,697.24
Income - Coins = $110.00

Cost of Sales
Cost of Income - QM = $16,897.74
Cost of Income - Coins = $0.00

Expenses
QM - Move & Count Expenses = $571.95
QM - Postage Expense = $2,227.15
QM - Rent Expense = $4,288.24
QM - Telephone Exp. = $76.79

Balance Sheet December 31, 1997 (same source)

Current Assets
Inventory - QM = $77,848.60

July/August 1997
Source: Quartermaster Report, The Graybeards, July/August 1997, page 29

Quartermaster Report
$143,00 in resale value of inventory that Ken Cook has moved. Stan Myrda is going to attempt to get a wholesale value. General discussion - Cook (L), Van Ort (MN), Morga (NY). Talked to Dixon Poole about taking over the Quartermaster business. Discussion. Jack Edwards (FL) - give the membership an option to purchase to buy off the items wholesale as its already been paid for by the membership. Orders are now being accepted - can be paid with Visa/MasterCard. Clawson (MN) - Commend Ken Cook (IL) for his very diligent work as acting Quartermaster.

1998
Source: Korean War Veterans Association Balance Sheet
December 31, 1998

Assets
Inventory - Quartermaster = $29,136
Commemorative Assets = $17,786
n Weapons = $8,050
n Granite = $1,140
n Coins = $8,596

January/February 1998
Source: Quartermaster Report, The Graybeards, January/February 1998, page 31

Quartermaster Report
Cook will work on inventory accounting system. There were 54 books on consignment from a publishing company. We found 53 of them and returned them. Edwards - How are consignment orders coming? Cook - There has been no problem with collecting money. Cook - In the past eight months we have ordered two items: overseas hats and patches. Question - Have quartermaster materials been sent to Dixon Poole? Magill - Some material was sent to Dixon Poole. To date only books. This was done in an effort to carry out intent of board to get out of inventory business. Adams - Has he paid the amount of the inventory? Martin - Have we received any money from him? Magill - No but he will provide this. Magill will discuss this matter with Adams before making any further commitment to Dixon Poole. Discussion - We need to find someone and get out of the quartermaster business. We had on paper over $100,000 tied up in inventory. Our ultimate objective is to get out of this business. Retail price approximately $140,000. The Executive Council will discuss this further at a later date.

1999
Source: Korean War Veterans Association Financial Status, Profit and Loss
January-October 1999 - Ordinary Income/Expense:

Income - Quartermaster - $1,489.00
Expenses - Quartermaster - $1,845.99

Quartermaster Eliminated
At the September, 1999, Executive Council meeting, Director Dot Schilling made a motion (seconded by Director Jack Edwards and carried by a board majority) to sell the organization’s quartermaster supplies to 2nd Vice President Ken Cook. The fact that the quartermaster inventory was about to be liquidated, and might be available for purchase to the highest bidder, was apparently was not advertised, either within the membership of the KWVA or to the public. Instead, the sale seems to have been limited to within the board itself, where ownership of the quartermaster inventory was transferred internally to Cook.

The financial consideration for the sale of the KWVA’s large Quartermaster inventory is unknown outside of the executive council. It was not announced in The Graybeards, and cannot be found on published financial statements. Cook told one member of the KWVA that he purchased the supplies for three to four cents on the dollar, but because his statement was an oral one, there is no concrete proof of this. Repeated queries to President Harley Coon as to the specifics of the financial arrangements with regards to this changeover have met with no response. For instance, Coon did not answer any of these questions posed by Lynnita Brown of the Korean War Educator on September 18, 2003:

  1. Does the KWVA still own any quartermaster items?
  2. If yes, is there an inventory of the items? Where are the items on the inventory stored? Specifically who compiled the inventory, when was it done, and by what method were the items inventoried?
  3. It is my understanding that John Maison was the quartermaster when he was indicted in federal court a few years ago. At the time he was quartermaster, where were the quartermaster supplies kept? Who authorized the removal of the supplies from Maison's control? How, when, and who moved the supplies from out of Maison's control? To where were they moved and then stored? Who had access to these moved and stored items? Have they been moved again since they were originally moved from southern Illinois? If yes, to where were they moved and who moved them? Who then had access to them?
  4. If the KWVA still owns quartermaster items, who is the quartermaster?
  5. When items are sold, where does the quartermaster money go within the treasury?
  6. Does the KWVA keep receipts for each item sold from the quartermaster inventory? If yes, where are the receipts stored? If not, why not?
  7. If there are--or have been--no receipts, how is the amount of income from the sale of KWVA quartermaster merchandise known and documented for the annual federal 990 tax form?
  8. If the KWVA no longer owns quartermaster items, how and to whom was the stock liquidated, and who authorized the liquidation?
  9. If the stock was sold, who purchased it and what was the selling price? What were the terms of payment? What sort of paperwork is available that documents the sale, and is it possible for a member of the KWVA to request a copy of that document? If yes, to whom should the request be made?

In addition, National Directors Dorothy "Dot" Schilling and Jack Edwards were asked the following questions by Lynnita Brown on September 29, 2003, and they have yet to respond:

"The two of you, respectively, made the motion and seconded it to sell the KWVA Quartermaster supplies to Ken Cook. Did Cook pay for the supplies outright or did he purchase them on consignment? Either way, what was the financial consideration for his purchase? Who took the inventory to determine the value of the Quartermaster supplies before they were sold to Cook? What was the reasoning behind selling the Quartermaster supplies in the first place? Did Cook become the new owner of all of the supplies, or was the ownership of at least some of the Quartermaster supplies retained by the KWVA? After Cook purchased the Quartermaster supplies for his own personal use, did he pay for advertising space in the Graybeards magazine or was the space given to him for free? Any help you can give me to answer these questions would be appreciated. Your responses will be posted on the Korean War Educator. Thank you."

The Graybeards Documentation
Because of the questioned directors’ unwillingness to discuss the matter, the only way for KWVA members to review the Quartermaster holdings is to check out recent back issues of The Graybeards. The following is a chronological listing of the quartermaster inventories taken from The Graybeards magazine from May/June 1998 through July/August 2001:

May/June 1998 Graybeards, "April 30, 1998" balance sheet, p. 13
Quartermaster inventory $78,000.62
Q.M. Commemorative inv.
Weapons 11,408.00
Granite 3,868.15
Coins 8,596.00
Total $101,872.77
-Jul/Aug 1998 Graybeards, June 30, 1998, balance sheet, p. 35
Quartermaster Inventory 72,084.49
Q.M. Commemorative Inven.
Weapons (raffle) 8,050.00
Granite 3,868.15
Coins 8,596.00
Total 92,598.64

-Actual Expenditures vs. Budget Comparison Rpt
Sept/Oct 1998 Graybeards, Aug 31, 1998, p. 32
Q.M. Income 18,574.43
Q.M. Expenses 12,531.16
Q.M. Net 6,043.27

Nov/Dec 1998 Graybeards, October 30, 1998 p. 30
Q.M. Income 27,231.00
Q.M. Expenses 15,841.00
Q.M. Net 11,390.00

Jan/Feb 1999 Graybeards, Dec 31, 1998, p. 11
QM. Income 28,329.75
Q.M. Expenses 15,840.47
Q.M. Net 12,489.28

Summary of Expend. vs. Budget Comp. Rpt.
Income Expenses Net
18,574.13 12,531.16 6,043.27
27,231.00 15,841.00 11,390.00
28,329.75 15.840.47 12,489.28
=74.135.18 =44,212.63 =29,922.55

Financial statements with Balance Sheets to "show" any Q.M. INVENTORIES
were NOT included in the "3" aforementioned Graybeards.

-CPA, January 21, 1999 Letter of 1998 "Compilation" of Statements of
KWVA financial condition for Jan 1 - Dec 31, 1998 approved by Coon.
Balance sheet reads:
QM Inventory 29,136.00
QM Comm. Invent
weapons 8,050.00
Granites 1,140.00
Coins 8,596.00
Totals 46,922.00

Summary QM Net ($29,922.55) CPA QM Inventory $29,136.00?

-Mar/Apr 1999 Graybeards Jan 1 - Feb 28, 1999, P+L Statement & Balance
sheet, p. 15, shows NO QM inventories or income/expenses.

- May/Jun 1999 Graybeards, Apr 3, 1999 Balance sheet, p. 16, shows NO QM
Inventories, income or expenses.

-Jul/Aug 1999 Graybeards: Apr 24, 1999 Council Meeting Minutes, p. 11:
" Motion made to accept Quartermaster Agreement by Jack Edwards, seconded
by Ed Grygier. Motion carried: Yes 6, No 5, Abstain 1. Motion made by
Jack Edwards to appoint a committee to implement the agreement for
quartermaster, seconded by Don Barton."

-Jul/Aug 1999 Graybeards, July 1, 1999 Balance Sheet, p. 8, shows NO QM
Inventories, income or expenses. Jan/Feb 2000 Graybeards, Sept 12-13, 1999 Reunion Council Meeting Minutes, p. 26: "A motion was made by Director Dot Schilling and
seconded by Director Jack Edwards to sell Quartermaster supplies to 2nd
V.P. Ken Cook. Motion carried."

-Sept/Oct 1999 Graybeards, Sept 22, 1999 Balance Sheet, p. 53, shows NO QM
Inventories, income or expenses.

- Nov/Dec 1999, Jan 1- Oct 30, 1999 P&L Statement, p. 39, shows QM
" income" of $1,469.00 and "expenses" of $1,845.99 but NO Inventories!

-Jan/Feb 2000 Grybrds, Dec 31, 1999 Statement of Cash Basis, p. 41,
shows only QM Commemorative inventory: Weapons: $8,050.00; Granite
$1,140.00; Coins $8,596.00; Total $17,786.00. Same Inventory figures as
aforementioned in CPA 1998 Compilation.

-Jul/Aug 2000 Graybeards, June 30, 2000 Statement of Cash Basis, p. 6,
shows QM Commemorative inventory, Weapons $8,050.00; Granite $ 0000;
Coins $ 0000?

-Jul/Aug 2001 Graybeards, Sept 30, 2001 Statement of Cash Basis, p. 13,
shows QM Commemorative Inventory: Weapons $3,000 (raffle).

Ken Cook as Quartermaster
KWVA National Director Ken Cook resides in Danville, Illinois. When he took over ownership of the quartermaster inventory, he placed large advertisements in The Graybeards magazines. Advertising rates for a 2/3 page-size advertisement similar to the Quartermaster ad that appeared in the September/October 2000 issue of The Graybeards (page 61) was quoted by Graybeards Editor Vincent Krepps to Lynnita Brown in 2003 as 2/3 page, 1 issue = $225; 2/3 page, 2 issues = $275; and 2/3 page, 4 issues = $350. National directors and finance committee members Dot Schilling and Jack Edwards failed to respond to questioning by Lynnita Brown of the Korean War Educator, asking whether or not Ken Cook paid for this advertising himself.

It is interesting to note that the Cook advertisement requested that checks be made out to "KV Quartermaster", not KWVA Quartermaster. He also put the title after his name as "KV Quartermaster." Cook, however, apparently did not discourage buyers and vendors from thinking that he was the official KWVA Quartermaster. For instance, his checks for Account No. 830555 at Danville Consolidated Credit Union, Danville, Illinois, were printed with the name and address:

KWVA Quartermaster
1611 N. Michigan Ave.
Danville, IL 61834-6239

Not the KWVA's Problem
Correspondence received by the Korean War Educator from Cook's dissatisfied customers affirms that they thought they were dealing with a representative of the Korean War Veterans Association. Instead, they found out the hard way that they were dealing with a KWVA national officer who was apparently buying and selling merchandise for his own personal gain. Many thought their orders were supporting the KWVA, Inc., when, in fact, their orders were actually benefiting an independent dealer who held a position of trust on the KWVA executive council. . Their comments are listed further down in this segment of KWVA News - Quartermaster (see Irving Breitbart, Eagle Awards & Trophy).

KWVA National President Harley Coon, explained his position on the ensuing quartermaster controversy in an e-mail that found its way to the KWVA Ad Hoc message board on May 9, 2003: "This is more BS coming from a few of the rabble rousers," he said. "In 1999 at KWVA reunion the council voted to do away with the KWVA Quartermaster because it was costing us two [sic] much money. Case in point. Hats were bought for $20.00ea and sold for $18.00ea [sic] losing $2.00 on every hat sold. Ken Cook bought all the inventory and run it like his own business [sic]. The KWVA has nothing to do with the Quartermaster. The Treasurer has never written a check to the Eagle Co…. We in the KWVA have never had a check bounce. The dispute is between Eagle and Ken Cook NOT the KWVA. As far as the financial records of KWVA are concerned anyone is welcome to come to National Headquarters and inspect and even audit the 6 boxes of records that has all checks and receipts and bank statements. Do these bellyachers want the truth or do they just want to bitch. I have been in office for over 5 years and it is the same 20 yo [sic] 25 people that complain. The membership is very happy with the way the KWVA is being administered. Harley J. Coon President"

The problem with President Coon’s statement is that many believe that the KWVA has everything to do with the Quartermaster, if National Director Kenneth Cook is writing insufficient funds checks that bounce under the name "KWVA Quartermaster." Quartermasters from local chapters have found that the name "KWVA Quartermaster" has left a bad taste in the mouths of vendors who received bad checks from Account No. 830555 at Danville Consolidated Credit Union, Danville, Illinois, signed by Kenneth B. Cook. Cases in point are those described by Irving Breitbart of Eagle Awards & Trophy Company in New York, and Tom Sunseri, Quartermaster for KWVA chapter #014, Department of Florida.

Irving Breitbart, Eagle Awards & Trophy
Irving Breitbart is the owner of Eagle Awards & Trophy Company, formerly in Mohegan Lake, now in Cortlandt Manor, New York, and he is also the president of the Westchester-Putnam Chapter #91 in New York. "For the record, I have taken this chapter from a membership of 75 members to over 200 members now," Breitbart told the Korean War Educator. His company has been selling supplies to various chapters of the KWVA organization for a long time. "Our track record with the various chapters has been very good," he said, "and if you should want names of some of them to talk to, we would be more than happy to give them to you."

Eagle Awards & Trophy Company has been doing business with the Korean War Veterans Association, Inc., since March of 1999, making 24 sales and sending 24 invoices to "Korean War Vets Assn/Natl." The KWVA contact person whom the company dealt with during the 24 sales transactions was national director Kenneth Cook, who took on the job of Quartermaster after those duties were taken from John Maison in early 1997.

On July 23, 2002, Kenneth Cook wrote an insufficient funds check in the amount of $286.25 to Eagle Awards & Trophy for invoice #021603. "Mr. Ken Cook bought the overseas caps and patches from my company for use by him to sell to the brothers in the organization," explained Breitbart. "I ran the check through the bank only once since it came back stamped that there was no money in the account. I also sent him a notice that he had a bounced check and that he was liable for double the amount shown on the check as well as legal charges. I never heard from him after leaving messages, etc. If you will also note, the heading on the check states that he is the quartermaster for the KWVA. When I started selling to Ken Cook, I thought that I was selling to the KWVA National organization. I have contacted Harley [Coon] many times, as well as the treasurer of the KWVA, and still have not gotten any replies. It still is strange to me that Ken was able to print his checks with the KWVA Quartermaster name on it."

The unpaid invoices from Eagle Awards (forwarded by US mail from Mr. Breitbart to the Korean War Educator) for supplies purchased by Ken Cook were addressed: "Sold to: Korean War Vets Assn/Natl., Attn.: Ken Cook, Qurtrmstr, 1611 N. Michigan Ave., Danville, IL 61834." The invoice dates were: 08/08/01; 8/14/01; 11/08/01 (two invoices on this date); 11/09/01; and 11/13/01. Readers will recall that KWVA president Harley Coon stated that the KWVA went out of the quartermaster business in 1999—long before the above invoices were issued. The invoices show that Eagle Awards & Trophy Co., Inc., was still billing "Korean War Vets Assn/Natl" two years after the KWVA eliminated its quartermaster supplies by selling them to Ken Cook. Even two "Demand for Payment of Dishonored Check" notices were addressed to "Ken Cook, KWVA Quartermaster."

When the "KWVA Quartermaster" check was returned for insufficient funds, Breitbart called and wrote to various national officers of the KWVA, seeking redress for the bad check. Then, because the Eagle Awards & Trophy Company received no reply from Cook (KWVA national director), Coon (KWVA national president), or Gregory (KWVA national treasurer) about the bounced check, Mr. Breitbart turned the account over to a collection agency. He said, "The offer that Ken has made to the attorney is that he was willing to pay $100.00 per month (from his social security check) to pay off the debt that is now around $6,000.00. According to Ken’s offer, he will be paying this debt off for the next five years at that rate, and then what happens about the accruing interest charges?" Inquiries to Mr. Breitbart about the KWVA Quartermaster bad check can be made by calling him at his office number, 914-734-7600. "If there is any member of this organization that needs more proof about this situation," he said, "please feel free to drop me a line or if you wish we can talk about it on the telephone. For the record, I know of another supplier that he also stiffed for merchandise that he ordered and received and still has not paid for."

Dissatisfaction with service
Tom Sunseri Complaint
Tom Sunseri. the Quartermaster for KWVA chapter #014 in the Department of Florida KWVA, is also not pleased with the reputation that follows Ken Cook in his dealings with vendors. Sunseri sent the following e-mail message to Ted Trousdale, a past national director of the Korean War Veterans Association, on September 25, 2003:

"Thank you for all the past updates concerning our past national KWVA Quartermaster, Mr. Ken Cook. I have in the past and will be in the future be following his actions and associations closely. I became suspicious of his actions approximately 1 1/2 to 2 years ago when I first started to hear aversive rumors about the national Q/master Post.

Since I became the quartermaster for chapter #014 several years ago, and then on to my present position as Dept. of Fl. Quartermaster, I faithfully checked in the Graybeards magazine, each month, for the advertisement as placed therein by Mr. Ken Cook, National KWVA Quartermaster. In reading that advertisement when presented, I used it as a barometer on what the nominal current price could be charged in the sale of quartermaster items that I may offer for sale. After detractive rumors became rampant, the regular advertisements as mentioned, disappeared. Of course, having served as a chapter and a Fl. state Quartermaster I took this matter to heart, and became suspicious of the actual future proceedings.

My thoughts at that time, did Mr. Ken Cook resign? If so what happened to the inventory and any monies accumulated in the sale of inventory stock as previously listed?

Who purchased the inventory or what happened to it? Who governed, and how much monies where given to Mr. Cook to begin his operations as our national KWVA Quartermaster? What audits were made, if any, and to what body? What were his previous qualifications to be placed in charge of that position? Did he previously have actual quartermaster experience?

Many more questions relevant to this subject could be asked, but practicing brevity, those questions could be presented later in a proper format. Why I am writing to you now is, I contacted a new vendor today, Sept. 25th, 03, and in the course of doing business, I told him my name and title of position, IE: Tom Sunseri, KWVA~FL. Quartermaster Post. Immediately I was asked of my association with a Mr. Ken Cook. Taking a defensive position, I replied, I knew of him, had dealings with him, but other than that, I presented no further comments. The vendor elected to tell of his prejudices toward Mr. Ken Cook.

Mr. Cook had purchased Quartermaster items from his company, did not pay for them to the amount of several hundred dollars, and then resold them to another party. As I was not party to those certain dealings, where the truth lies should be explored. If these events did happen with this vendor, how many more vendors may be unpaid? If this event is in truth, Mr Cook has neglected his primary fiduciary duties and has tarnished the reputation of our KWVA organization and all its members.. I take offense, that when I contact a new vendor, I am personally painted with the same sordid brush that was caused by the actions of Mr. Cook. This having been said, I personally believe that it is now the time to pull a full forensic audit on the past quartermaster activities. These and other allegations should not be neglected, but explored. Someone should now be brought to bear. I am not, nor have I ever, in over twenty years in operating my own company, been accused of being a deadbeat, and I do not take it lightly that I am now associated with an organization that may be considered as such. Answers and actions are needed now concerning past KWVA, National Quartermaster allegations to protect all its members reputations."

Sunseri also wrote to former KWVA Ritchie Alexander, on September 29, 2003, making this statement: "For Mr. Cook to use the title ‘Korean War Veterans Association’ may be fraudulent by deceit. I ordered inventory items from Mr. Cook and as I have the billings in my files with that exact heading, I and others were deceived. I honestly believed that our monies were going to support our organization and not to profit an individual. So with other vendors, who sold Mr. Cook items believing that they were dealing with the Korean War Veterans Association. Due to that title the vendors, etc., were persuaded to issue credit to Mr. Cook who otherwise could not obtain credit on his own credit report. Saying softly, we were hoodwinked. Punishable? I am no lawyer, but? Incidentally, I recently opened a new account with a new vendor and when I used the words, Korean War Veterans Association, to open the conversation, I was immediately questioned on Mr. Ken Cook. I had to convince the vendor that I was not associated in any way with Mr. Ken Cook or I possibly could not do business with that company. I present the fact that, we members in the KWVA are being punished by the stigma of Mr. Cook…. My opinions, I believe that all vendors or others owed monies by Mr. Cook be paid by the present executive board. Reasoning, the past, or some members of the present board, certainly knew that Mr. Cook was dealing and using the KWVA title and logo on his letterheads, etc. at that period in time. No attempt was made by those certain executive board individuals to warn Mr. Cook not to use that title or logo. Hence by not attempting to stop Mr. Cook from using that title and logo, the board acted as complacent and by those actions, actually were cooperating in perpetrating the false entitlement and enrichment to Mr. Cook. That may [be] regarded as a direct link to the then executive board and Mr. Cook."

As of this writing, November 10, 2003, the directors on the executive council of the KWVA had not officially acted on resolving this very serious matter. In lieu of the council's inaction, individual members of the KWVA submitted written complaints about the situation to the New York Attorney General's office. As yet, there is no word from the NYAG as to whether or not that office will investigate allegations of self-dealing and conflict of interest on the council.

 

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