NEW YORK (AP) — Four people connected to a company hired by New York City to operate homeless shelters for migrants were arrested Tuesday as part of a federal public corruption investigation that is also examining a City Council member and a top aide to New York Gov. Kathy Hochul.

The charges Tuesday focused on two leaders of the nonprofit, BHRAGS Home Care Corp., who are accused of stealing more than $1.3 million from the taxpayer-backed organization, and two subcontractors who the indictment says paid bribes and kickbacks to the men in exchange for contracts worth millions.

Investigators are also probing whether City Council Member Farah Louis and her sister Debbie Louis, an aide to Hochul, accepted bribes related to the appropriation of city funds to the nonprofit, according to a copy of a search warrant viewed by The Associated Press.

The Louis sisters were not among the four people arrested on Tuesday. Debbie Louis was placed on leave after the governor's office learned of the investigation last week, a Hochul spokesperson said.

The indictment describes multiple layers of corruption within BHRAGS, a service provider that has received nearly $200 million in contracts from the city's Department of Homeless Services since 2022.

Prosecutors said the company's executive director, Roberto Samedy, and its former board chairman, Jean Ronald Tirelus, siphoned money from the nonprofit, including $800,000 earmarked for "economic growth and affordable housing” in distressed Brooklyn neighborhoods.

The pair also received more than $200,000 in kickbacks and bribes in exchange for steering contracts worth millions of dollars to businesses controlled by Edouardo St. Fort and Miguel Jorge, the indictment said.

Tirelus, Samedy and Jorge all pleaded not guilty through their attorneys in court on Tuesday and were released on bond. Tirelus’ lawyer, Todd Spodek, said he “categorically disputes the charges.” Samedy's attorney, Seth Zuckerman, said his client was intent on “clearing his name and getting back to the important work BHRAGS is doing in the community.”

St. Fort, a former New York City police sergeant, appeared in a Boston courtroom Tuesday and was also released on bond. He did not enter a plea and did not respond to questions as he left the courtroom.

The case was initially referred to authorities by the city's Department of Social Services, which raised concerns about BHRAG's payments to St. Fort's security company, Fort NYC Security, according to a spokesperson for the agency.

Joseph Nocella, the U.S. attorney in Brooklyn, said the defendants worked together “to loot public funds from an organization devoted to serving vulnerable New Yorkers.”

The indictment did not outline any wrongdoing by others. All four of the men arrested Tuesday were mentioned in a search warrant, signed March 19, seeking communications between the nonprofit, the Louis sisters and Edu Hermelyn, a political consultant.

Hermelyn is the husband of state Assembly member Rodneyse Bichotte Hermelyn, who chairs the Brooklyn Democratic Party.

Messages left for Farah Louis, Debbie Louis and Edu Hermelyn were not returned.

In a statement, a spokesperson for BHRAGS said the nonprofit has served New Yorkers for more than 50 years “with integrity and the highest ethical standards, and we take the allegations against Mr. Samedy seriously.”

The company has long focused on providing at-home health care to the sick and elderly, but expanded its mission in recent years to include homeless services. That pivot came as the city's existing shelter system was stretched thin by the influx of asylum seekers under the former mayor, Eric Adams.

Hermelyn served as a senior advisor to Adams, but resigned over questions about whether he was allowed to hold that position while simultaneously being a Democratic Party district leader.

Tirelus and Samedy were charged with wire fraud, embezzlement, and bribery-related offenses. St. Fort and Jorge were charged with federal program bribery and related charges. All face possible prison sentences if convicted.

New York City Mayor Zohran Mamdani said the city would “definitely be looking into” the city's contracts with BHRAGS.

The existence of a search warrant naming Farah and Debbie Louis doesn’t necessarily indicate prosecutors plan to bring criminal charges against them, only that investigators persuaded a magistrate judge to allow them to dig deeper and seize evidence.

Nevertheless, the governor’s office said Debbie Louis has been placed on leave. A spokesperson for the City Council said it “takes any potential misconduct extremely seriously.”

“New Yorkers deserve confidence in their government,” said Yoav Gonen, the council’s communications director. “It is essential that the federal investigation proceed fairly and expeditiously to bring this matter to a resolution.”

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Associated Press reporter Michael Casey contributed to this report from Boston.

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