Company tied to brother of top Adams officials didn’t competitively bid contract, comptroller says
New York City's Administration for Children's Services withdrew a contract from a vendor with ties to high-ranking City Hall officials after city Comptroller Brad Lander raised numerous red flags about the potentially favorable deal, according to a letter obtained by Gothamist.
According to the contract rejection letter sent by the comptroller on Tuesday, ACS accepted a bid from an IT support company once listed as a client on the now-defunct website of a consulting firm, The Pearl Alliance, founded by Terence Banks, without giving other companies a chance to compete for the work, which involved maintaining data storage hardware for the agency.
The letter also said ACS allowed Derive Technologies to submit its bid late. It failed to complete required paperwork related to campaign donations and didn't give Lander's office enough time to review the contract, according to the letter, which Gothamist obtained through a Freedom of Information Law request.
Banks is the brother of two high-ranking Adams administration officials: Deputy Mayor for Public Safety Phil Banks and Schools Chancellor David Banks. Federal prosecutors in Manhattan are investigating Terence Banks and his company in connection with a suspected bribery scheme, according to the New York Times.
The FBI recently raided the homes of Phil and David Banks and seized their phones. Derive did not immediately respond to messages seeking comment on Thursday.
An ACS official told Gothamist that the agency is rebidding the contract due to the comptroller's concerns. The official said ACS conducted a "mini-bid" — a more limited bidding process — and Derive was the only company that applied.
According to officials, Derive's one-year contract with ACS was valued at roughly $55,000 and required the company to provide maintenance and on-site support for data storage hardware.
According to the letter, the contract started on July 1, 2024, which predates the news that the Banks brothers were under federal investigation.
The letter shows that the comptroller raised concerns about "inconsistencies and defects" in how ACS approved the contract, leading to the comptroller rejecting the contract.
According to the letter, ACS didn't open the bidding to other companies — an integral part of the process to encourage competition and reduce the cost of contracted services to taxpayers. The letter indicates that ACS claimed to have solicited bids from companies, but one unnamed company said it never received the bid request.
The letter also noted that it was unusual for ACS to accept Derive's bid two days after the bid window had closed.
Additionally, the letter stated that ACS submitted the contract for the comptroller's review after the contract had already gone into effect. ACS also failed to complete paperwork indicating that Derive complied with city campaign donation requirements for government vendors, the letter said.
There's no evidence that ACS skewed the bid to help the company or that Derive actually retained Terence Banks. Another company listed on his website told Gothamist that it had never worked with him.
