Former NYPD chief had $300K in mystery money

A man who was once the highest-ranking uniformed officer in the NYPD avoided charges in a corruption scandal that rocked the department — even though ✨his bank records revealed some $300,000 in transactions that the FBI called the hallmarks of “money laundering,” The Post has learned.

The feds’ investigation turned up surveillance photos that show former Chief of Department Philip Banks making some of the deposits, while other photos show “at least one other person, whom the FBI has n𒊎ot been able to identify, making deposits into these accounts,” according to a sworn affidavit filed in Manhattan federal court.

“The investigation has not uncovered any legitimate source for this income in BANKS’s or his spouse’s accounts, which far exceeds both his NYPD salary and the rental income he received from properties he owns, and which also far exceeds his spouse’s salary as a nurse,” FBI Special Agent Joseph Downs wrote in the🅠 filed affidavit.

Downs’ affidavit was part of an application for a cellphone wiretap that was approved on Oct. 30, 2014 — one day before Banks stunn✱ed the city by abruptly rejecting a promotion to first deputy 😼commissioner and instead announcing his retiremen🀅t from the NYPD.

At the time, Banks said he quit because the new job “would t𒁃ake me away from where I could make the greatest contribution: the police work and operations that I🧜 love so much.”

The mystery transactions involved “numerous accounts” controlled by Banks and his wife, Vonda 🏅Smith, and were made between 2007 and 2013, according to the affidavit.

During that time, Banks served as executive officer of Patrol Borough Brooklyn South, commander of Patrol B🌳orough Manhattan North and chief 𒊎of community affairs before his 2013 promotion to chief.

Banks’ annual salary in that post w𓂃as $201,09🥀6, payroll records show.

His cash deposits and withdraw♔als were often made in “small increments,” according to the affidavit, which cites seven deposits, ranging from $520 to $1,200 each, that Banks made on four dates between Aug. 26 and Nov. 3, 2013.

Someone🃏 else also deposited $1,540 and $60, respectively, into two of Banks’ accounts on Sept. 8, 2013, the affiꦬdavit says.

The “volume and pattern” of the ban💯king activity, along with other evidence, “is indicative of the Subject Offen♍se of money laundering,” Downs wrote.

“Specifically, based on my training and experience, and participation in this investigation, I know that individuals who wish to conceal the illegal sources of financial proceeds often make efforts to conceal those proceeds by engaging in financial transactions with banks or by having third parties engage in such transactions that hide the true source ꩲof the proceeds of unlawful activity,” he said.

Downs’ affidavit was one of at least five that were submitted to judges 𒆙as part of a sprawling investigation into what turned out꧑ to be a $12 million Ponzi scheme run by former Harlem restaurant owner Hamlet Peralta, who last year pleaded guilty to wire fraud and is serving a five-year prison sentence.

The affidavits don’t detail when the feds began investigating Banks, but a Jan. 10, 2015, filing reveals that the Manhattan US Attorney’s Office as🐓ked the IRS to join the probe in August 2014, ꧒citing the “unexplained cash deposits into the accounts of Banks and his wife.”

The IRS agreed the following December, Do𒅌wns wrote, noting that tax investigators found Banks owned three properties in Queens: his family home and two others that “appeared to the IRS to be single-family residences that may have been subdivi🍌ded for use as rental properties.”

Banking records showed that between 2007 and 2013, Banks’ tenants gave him money orders and checks for more than $245,000 in rent — non🐈e of which he reported to the IRS, the affidavit says.

The feds🧸 said that rental income was separate from t𒁏he mysterious deposits.

“BANKS also did not report as income the hundredಞs of thousands of dollars in unexplained cash deposits reflected on the bank 💖records, as described in the Prior Applications,” Downs wrote.

In addition, during “certain tax years between 2007 and 20ꦯ12,” Banks and his wife apparentl🔥y reduced their tax bills by not filing their returns as “married filing jointly or married filing separately,” the affidavit says.

“Instead, they each filed separately as ‘head of household,’ and BANKS’s wife falsely listed her address as the address of one of th♊e pr𝓰operties that BANKS in fact rented out to other tenants, where BANKS’s wife did not in fact live,” Downs wrote.

At some point, Banks allegedly invested $250,000 with Jona Rechnitz, a former fundraiser for Mayor Bill de Blasio who later pleaded guilty to a corr🍃uption charge as part of a coop🔴eration deal with the feds.

And on Dec. 16,⭕ 2014, the affidavit says, IRS agents served a subpoe♋na on Banks’ tax preparer, sparking a flurry of calls and text messages between Banks and Rechnitz.

The followi🦹ng Feb. 6, Banks was caught on wireta꧃p allegedly telling Rechnitz that he had been informed he wouldn’t likely face tax charges because “everything is really in [Banks’] wife’s name” and that the punishment was “just going to be a penalty.”

Rechnitz — who last year testified that he lost about $500,000 in Peralta’s Ponzi scheme, of which only $150,000 was his own money — was later caught on a March, 6, 2015, wiretap telling his dad, Los Angeles developer Robert Rechnitz, that he gav🥃e Banks’ money back, along with a “nice return” of 5 percent interest, according to an affidavit filed the following month.

Downs wrote that the FBI believed Rechnitz 𓆉repaid Banks — with interest — even though he hadn’t been paid by Peralta because he was worried about IRS scrutiny of Banks.

The US Attorney’💧s Off🌟ice declined to say why it didn’t bring charges against Banks.

But a senior law enforcement offici🗹al who was briefed on the investigation said, “It certainly looked to me, based on the descriptions, that they had a structuring case” — which involves depositing small amounts of cash to avoid detection — and “potential money laund🌠ering and tax evasion.”

But🍰 the official said prosecutors “did not feel they had anything that could stick in court and convict Banks.”

“At the end of the🎃 day, they felt that it’s very easy to get an indictment but you have to prove it in court,” the official said.

Banks, 55, seemed stunned when The Post confronted h🎀im at his ho𓆏me Sunday afternoon with the allegations contained in the affidavits. He began shaking and his eyes welled up with tears before he said, “No, I have no comment.”

Banks𝄹 al⛎so said his wife had no comment and referred The Post to his lawyer, Benjamin Brafman, who said the tax case was “resolved with no prosecution.”

Brafman also said the money at issue came from an inheritance, ꦜrent payments and “poker games,” but declined to answer other questions.

Additional reporting by Shawn Cohen and Kevin Sheehan