ALBANY, N.Y. (AP) — New York Lt. Gov. Brian Benjamin resigned Tuesday in the wake of his arrest in a federal corruption investigation, Gov. Kathy Hochul said, creating a political crisis for her seven months after she selected Benjamin as a partner to make a fresh start in an office already rocked by scandal.

Benjamin, a Democrat, was accused in an indictment of participating in a scheme to obtain campaign contributions from a real estate developer in exchange for Benjamin’s agreement to use his influence as a state senator to get a $50,000 grant of state funds for a nonprofit organization the developer controlled.

Facing charges including bribery, fraud, conspiracy and falsification of records, Benjamin pleaded not guilty Tuesday at an initial appearance in Manhattan federal court. He was released and bail was set at $250,000. The terms of his release call for his travel to be restricted and bar him from returning to the state capitol in Albany.

He submitted his resignation to Hochul hours later.

“I have accepted Brian Benjamin’s resignation effective immediately. While the legal process plays out, it is clear to both of us that he cannot continue to serve as Lieutenant Governor. New Yorkers deserve absolute confidence in their government, and I will continue working every day to deliver for them,” Hochul said in a statement.

Two lawyers representing Benjamin did not immediately respond to messages seeking comment.

Hochul in September plucked Benjamin, then a state lawmaker, to serve as second-in-command when she became governor, taking over for Democrat Andrew Cuomo. Cuomo resigned amid allegations he sexually harassed 11 women, which he denied.

Hochul, also a Democrat, was Cuomo’s lieutenant governor. She is now running for governor in this year’s election, with Benjamin as a running mate.

Hochul didn’t immediately respond to a request for comment Tuesday when asked who she will pick as her new lieutenant governor. New York Senate Leader Andrea Stewart-Cousins, a Democrat, stepped in to take on the duties of lieutenant governor until Benjamin’s appointment.

Two months after Benjamin became lieutenant governor, a real estate developer who steered campaign contributions toward Benjamin’s failed bid for New York City comptroller was indicted. Federal authorities accused Gerald Migdol of conspiracy to commit wire fraud, wire fraud, and aggravated identity theft in illegally giving donations to Benjamin’s campaign.

The indictment said Benjamin, formerly a state senator from Harlem, and others acting at his direction or on his behalf also engaged in a series of lies and deceptions to cover up the scheme that stretched from 2019 to 2021.

They falsified campaign donor forms, misled municipal regulators and provided false information in vetting forms Benjamin submitted while he was being considered to be appointed as lieutenant governor, the indictment said.

Prosecutors had previously not made any accusations against Benjamin, and his campaign said at the time of Migdol’s arrest that it had forfeited any improper donations as soon as they were discovered.

More recently, reports came out saying subpoenas had been issued to Benjamin regarding the financial issues even before Hochul picked him as lieutenant governor.

Before Benjamin’s arrest and resignation, Hochul had defended him, saying last week she had the “utmost confidence” in him. She said on Monday that she didn’t know of the subpoenas when she tapped Benjamin to be her No. 2.

Lawmakers from both major parties had called on Benjamin to resign, including at least a dozen of Benjamin’s fellow Democrats in the Legislature by Tuesday afternoon.

Even as he resigns, Benjamin is still set to appear on the ballot for the 2022 gubernatorial Democratic primary.

He’ll likely be on the ballot even if Hochul picks a new lieutenant governor and running mate, according to state elections law.

New York law makes it tough to get Benjamin off the ballot: he could move out of New York to disqualify himself from running for state office, or the state Democratic party could let him run for a down ballot office. State Democratic Party Chair Jay Jacobs didn’t immediately respond to request for comment from The Associated Press.

Benjamin was the state’s second Black lieutenant governor. During his state Legislature career, he emphasized criminal justice reform and affordable housing. His district included most of central Harlem, where he was born and raised by Caribbean immigrant parents.

The scandal is the latest in a long history of lawmakers and other Albany leaders who’ve been engulfed in allegations of wrongdoing.

Cuomo’s resignation as governor came not only amid allegations of sexual harassment but that his administration misrepresented the number of New Yorkers who died in nursing homes from COVID-19.

In 2008, then-Gov. Eliot Spitzer resigned amid a prostitution investigation.

Former New York Assembly Speaker Sheldon Silver, one of the most powerful figures in state government, resigned in 2015 after he was arrested on federal corruption charges.

Former Republican state Senate Majority Leader Dean Skelos, who for a time shared power with Silver, was convicted of extortion, wire fraud and bribery.

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Hays reported from New York. Associated Press writers Deepti Hajela, Michelle L. Price and Larry Neumeister contributed from New York and Michael Hill contributed from Albany.