Il Forno Bakery, a private wholesale business located near Hunts Point Produce Market, specializes in savory European-style breads. It’s the target of the city’s commission whose aim it to root out mafia influence in Bronx wholesale markets. Photo Credit: Aliya Chaudhry

Thirteen years ago, Roman Eduardo from the Dominican Republic founded Il Forno Bakery, a family-owned business on Faile Street next to the Hunts Point Produce Market, after he got into a dispute with a bakery where he was worked as a distributor.

Now his daughter Jenny Eduardo, director of sales, is in a different kind of dispute, this time with the Business Integrity Commission, the city agency that targets organized crime influence in the trade waste and wholesale markets.

For reasons that continue to baffle the owners, this city agency dedicated to rooting out mafia influences monitors Il Forno’s private bakery business like it does the public Hunts Point Market. 

The Business Integrity Commission charges public wholesale businesses a steep two-year $4,000 registration fee and the same for a two-year fee for fish vendors, money that must be paid with each subsequent renewal. In addition, the businesses must pay from $100 to $350 for ID’s for every employee. 

“It just sounds so bizarre to me that we have to pay these people to kind of make sure that we’re doing what we’re supposed to be doing within our private property,” Eduardo said. “This is not publicly-owned land. This is not a publicly-owned company.”

The Business Integrity Commission was started to regulate public markets located on city property. However, the Rules of the City of New York also designate markets that may be located next to public cooperatives as public markets as well, so that neighboring private wholesale businesses fall under the Business Integrity Commission’s jurisdiction.

“I think it’s just nuts the way that they came about their field of their scope of authority and where they can regulate,” said Eduardo. “I don’t think that was a fair decision as to how or where because literally across the street, I could move my business right across the street and I would not be regulated by the BIC.”

The commission didn’t always enforce regulation of markets outside of the cooperatives. That started following a 2006 lawsuit filed by the Hunts Point Terminal Produce Market against the city, the commission, Baldor Specialty Foods and the New York City Economic Development Corporation.

The produce market disputed the Economic Development Corporation’s decision to lease land to Baldor, according to Terri Sasanow, who represented the EDC in this case. That claim was dismissed, but the produce market also brought a claim against the Business Integrity Commission for failing to regulate markets outside the cooperatives, which was not dismissed.

The court initially ruled against the Business Integrity Commission, but the commission won on appeal. “Despite its legal victory, the Commission ultimately decided to begin regulating adjacent areas in 2009,” said a spokesperson for the commission in a prepared statement over email.

In 2013, officers from the Business Integrity Commission walked into Il Forno’s factory with paperwork to fill out and a demand for the $4000 fee, Eduardo said. The officers, he added, were in uniforms that resembled the police.  Despite initial skepticism about the legitimacy of the commission, Il Forno’s owners eventually complied, submitted the paperwork and paid the fees.

“Kind of a like a shakedown was what it felt like,” Eduardo said.

The personal nature of the questions on the employee ID applications was a concern for both Eduardo and Edward Taylor, President of Down East Seafood, Inc., a small wholesale fish market on Manida Avenue. Both owners said the applications asked personal questions they wouldn’t ask their own employees. Il Forno has around 35 employees and Eduardo estimates that roughly 85 percent of them live in Hunts Point. Taylor said Down East has 60 employees.

The requested information on the applications includes names and addresses of former spouses, work history, whether they’d been fired in the past and criminal convictions. It also asks applicants if they have filed their tax returns on time over the last three years and whether they or their spouses have given or received gifts worth at least $1000 dollars over the last three years.

“It was not a good thing,” Taylor said. “A self-funding city agency comes on private property and asks for money to vet your employees.”

Il Forno had no contact from the Business Integrity Commission after its initial registration until their officers came again in 2016 to drop off the paperwork and request an additional $4000 for a required registration renewal – a process Eduardo never completed.

Jenny Eduardo refused to renew, saying she felt her company “cannot afford to take that hit into cash flow just for no reason.”

The Business Integrity Commission asked her to pay another $4,000 for renewal. “For a small business that’s a pretty big chunk of change. That’s almost like the rent for us. That’s considered as substantial as the rent,” she said.

She didn’t pay the fee and as a result, in 2017, the Business Integrity Commission contacted her again, to give her a $1,000 fine for not complying.

“They came back and said, ‘You haven’t renewed so we’re here to fine you. You’re gonna get a summons.’ I said, ‘Okay, give me the summons, I’ll go and fight at the office,” Eduardo said.

She said two or three officers came to give her the ticket and took a copy of her ID.

“That was another thing that we found kind of weird,” she said. “If you’re just coming in to give us an application, why are there two people or three people? It looks like you’re coming here to take somebody out of here.”

Eduardo had a hearing at the Office of Administrative Trials and Hearings to dispute the fine in early 2018. The resulting decision was that Eduardo was required to pay it. However, she still has not complied.

Ana Champeny, a staff member at the non-profit watchdog Citizens Budget Commission, said that revenues licensing agencies such as the Business Integrity Commission collect go into the city’s general fund, which is used to pay for city operations.

“Many agencies don’t collect this proportion of their budget in revenues,” Champeny said. “That’s what makes BIC a little unique.” Revenues, she said, are not supposed to cost more than the price of doing the work.

Companies that are approved or denied registration after reviews are listed on the commission’s website. The website also posts reports detailing why a specific company was denied approval. Applications have been denied for reasons such as falsifying information, operating without registration, racketeering and associations with crime.

The Business Integrity Commission says it makes its decisions  “based on a comprehensive review of the application, and information from an in-depth analysis by BIC’s background investigations, legal, investigations, and audit units,” according to its website.

Il Forno has plans to open up a retail location in The Peninsula, a housing complex being built on the site of the now abandoned Spofford Juvenile Detention Center. That area is outside the Business Integrity Commission’s jurisdiction, a factor that influenced its decision to open up a branch in that location.

“While BIC has successfully prevented the wide-scale reemergence of organized crime in these industries, the influence and appearance of these actors and behaviors remains,” the website states. “Clearly, there is still the strong need for investigation, enforcement, and vigilance to prevent theft, fraud, and other manipulation of the industry.”

Eduardo is skeptical of the need for the commission to investigate this, especially the fact that the commission focuses primarily on registrations and applications. “I don’t see that they’re really doing anything anyway so why not just let the police worry about policing?”