Gothamist
A non-profit newsroom, powered by WNYC.
Gothamist
Listen Live
News
Al Capone, Lindbergh’s baby, and now, the NYPD: The IRS’s role in investigating Caban
By
Charles Lane
Published Sep 27, 2024
Share
FacebookTwitterRedditEmail
Never miss a story
Email address
By submitting your information, you're agreeing to receive communications from New York Public Radio in accordance with our Terms .
Erik McGregor/LightRocket via Getty Images
By
Charles Lane
Published Sep 27, 2024
Share
FacebookTwitterRedditEmail
We rely on your support to make local news available to all
Make your contribution now and help Gothamist thrive in 2026. Donate today
Gothamist is funded by sponsors and member donations
Mayor Eric Adams is facing criminal charges following a monthslong FBI investigation, but another formidable federal agency is pursuing a potentially damning probe into the police department he leads: the Internal Revenue Service.
Yes, the tax people. And so far at least two high-ranking NYPD officials, including former Commissioner Edward Caban, have left the department in the inquiry's wake.
But the IRS’s involvement doesn’t mean Caban is just accused of tax-related crimes. The agency is reportedly investigating allegations that NYPD officials shook down nightclubs for cash as part of what's known in mobster parlance as a protection racket.
According to current and former IRS agents who spoke to Gothamist, the presence of special agents with the IRS’s Criminal Investigation team suggests a complex financial investigation requiring an understanding of how money moves, or hides, in modern financial networks.
The IRS and federal prosecutors in Manhattan are investigating Caban, his twin brother James and other NYPD officials. The investigation centers on whether bars and restaurants paid James Caban for favorable treatment from police while he ran a business consulting for nightclubs and music venues, according to multiple news reports.
The IRS’ investigation of the NYPD is one of at least five probes engulfing Adams’ fundraising and administration appointees, which in part led to Caban’s resignation and the appointment of interim NYPD Commissioner Tom Donlon, whose home was also recently searched by federal investigators.
Although Adams vowed on Thursday to fight the charges leveled against him, several other top-level officials have resigned in recent days.
A spokesperson for IRS Criminal Investigation declined to comment or answer questions about the case.
Brad Mitchell, a special agent in New York’s IRS field office who is not involved in the NYPD investigation, spoke with Gothamist about the types of cases the IRS generally handles. In an interview, he said IRS Criminal Investigation special agents have backgrounds in certified public accounting.
“We're the experts that are trained to follow the money,” said Mitchell. “When you have that grassroots accounting knowledge, when we get a bank statement as the result of either a summons or subpoena or search warrant, we know what we're looking at.”
Mitchell said agents can take a company’s financial statements and determine if money was accurately accounted for.
On top of an accounting degree, he said IRS Criminal Investigation agents train for six months at a federal law enforcement training center before several years of on-the-job training. But, Mitchell said, it’s the accounting experience that makes the IRS experts in investigating financial crimes.
“From seeing it done correctly for so long, when you see it done incorrectly, it stands out like a sore thumb,” he said
The IRS notably took down Chicago gangster Al Capone, who was convicted of tax evasion in 1931 after being suspected of a multitude of other crimes. It also played a role in arresting the man who ransomed the kidnapped baby of Charles Lindbergh by indexing the bills given as payment.
The IRS Criminal Investigation unit had also spun up the case of missing tax returns to a massive bribery scandal that led to the U.S. Department of Justice indicting 14 FIFA and corporate executives, rocking the global soccer community in 2015. Richard Weber, the former head of the criminal investigation unit, recalled the case’s unraveling in an interview with Gothamist.
“Initially it was a tax case against [FIFA official] Chuck Blazer, who didn’t ever file a tax return, and he ultimately cooperated,” Weber said. “That then broke open the entire corruption case against a lot of the FIFA officials.”
When it comes to the Caban case, Weber said it’s possible that a cash-heavy nightclub owner being investigated for tax evasion flipped and gave the IRS a new case. But, Weber said, it’s equally conceivable that the U.S. attorneys sought out the IRS’s help.
“It could just be a desire by the prosecutor to want the IRS's financial investigative experience and expertise,” he speculated. “It doesn't necessarily have to be a tax case.”
Weber said IRS Criminal Investigation is also the foremost federal investigator for cybercrimes because of the complexity around tracing cryptocurrency. He cited the shuttering of the dark web marketplace Silk Road and fraudulent cryptocurrency company OneCoin.
“We started using a lot of data analytics when I was there and they're continuing to do a lot of work with blockchain technology,” he said, adding that the IRS recovers billions just in cryptocurrency each year. “The numbers are staggering in terms of what they're bringing into the treasury.”
Weber said IRS agents conduct searches and seizures on their own, make arrests, carry firearms and wear windbreakers emboldened with the word “police.”
Brian Ketcham, a white-collar defense attorney, described IRS Criminal Investigation agents as aggressive.
“They're issuing summonses, they're trying to cold call people, they're knocking on doors,” he said, adding that one of his clients was arrested at 6 a.m. and another was raided as soon as he walked into work.
“They came in with guns drawn, automatic weapons. It was a full-on SWAT-style raid on a 70-year-old accountant,” Ketcham said.
Ketcham said most of the unit's agents are fresh out of college and bring their firearms to work. He said he was not surprised to hear the IRS might be interviewing nightclub owners as part of the Caban investigation.
“That they would use intimidation tactics or misleading someone — you know, they're allowed to do that — that is not surprising to me at all,” he said.
Tagged
new york city
public safety
Politics
Charles Lane
Charles is a Day-of reporter focused on breaking news and enterprise. He’s very friendly and can be reached at [email protected], or more securely on whatsapp/signal 631-295-6715
Read more
Gothamist is funded by sponsors and member donations
Gothamist is funded by sponsors and member donations
MORE news
Central Park birders, others remember 63-year-old woman killed in park
People who said they knew her described her as an artist and a familiar presence in the Ramble.
By
Charles Lane
Published Sep 28, 2026 at 7:04 p.m. ET
Dump truck driver hits and kills cyclist on 34th Street in Midtown, NYPD says
It's the latest in a string of hit-and-run deaths in the city in recent months.
By
Liam Quigley
News
Dump truck driver hits and kills cyclist on 34th Street in Midtown, NYPD says
It's the latest in a string of hit-and-run deaths in the city in recent months.
By
Liam Quigley
New ingredient mandated for Latin American kitchen, restaurant plates in NJ
By
Arya Sundaram
A Brooklyn jail cell filled with smoke. The emergency button failed, a lawyer said.
By
Samantha Max
Crews launch tunnel machines to dig first new Hudson River rail tunnels since 1910
By
Michael Sol Warren
Never miss a story
Catch up on the most important headlines with a roundup of essential NYC stories, delivered to your inbox daily.
Sign upEmail address
By submitting your information, you're agreeing to receive communications from New York Public Radio in accordance with our Terms .