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New Suffolk couple charged with fraud in Sandy funds

A couple faces fraud charges for claiming their New Suffolk cottage to be their primary residence to receive superstorm Sandy relief, federal officials said.

According to a complaint filed Nov. 29, William Grella, 64, and Gary Osborne, 44, received just under $80,000 in relief funds from different agencies for the cottage that was damaged in the October 2012 storm. The complaint, filed by the U.S. Department of Housing and Urban Development Office of Inspector General, described the First Street cottage as a summer and weekend retreat and not a primary residence needed to be eligible for the funds.

Mr. Grella, a doctor who practices primarily in Wayne, N.J., and Mr. Osborne, a fashion designer, received at least $4,116 in Federal Emergency Management Agency relief, a $14,000 initial payment of Small Business Administration loan, $34,734 through state storm recovery funds and $26,805 in interim mortgage assistance disaster recovery funds, according to the complaint.

  • Read the entire complaint below

The couple claimed the New Suffolk home was their primary residence on applications for assistance and that storm damage made it unsafe to live in with their two children, but officials point to a Rockland County property as their primary home, according to the complaint.

A Google Maps picture of the home from August 2012 shows what the home looked like prior to the storm. It has since been completely renovated and raised.

The home pictured in August 2012. (Credit: Google Maps)

Both were arraigned Wednesday in U.S. District Court in Central Islip. They were each released on $100,000 bond.

The attorney representing the couple could not be reached for comment.

The couple were quoted in a 2007 New York Times story about the North Fork.

“The whole reason behind having a second home is to spend quiet time at your home,” Mr. Osborne said in the article.

Another story in 2013 in Crain’s New York Business magazine about the children’s clothing manufacturing that Mr. Osborne started called Oliver & Adelaide LLC — a Manhattan-based business — contained the following line: “He’s hired stay-at-home moms and retirees on the North Fork of Long Island where he spends weekends…”

Photo caption: The New Suffolk home the couple claimed to be their primary residence. (Credit: Kelly Zegers)

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Grella Complaint by Timesreview on Scribd