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Three men whose drug arrests were tossed because of the Brooklyn South narcotics squad scandal have sued the city, charging undercover cops faked evidence, the Daily News has learned.

A Brooklyn Heights massage parlor owner who sued the NYPD after cops raided her business will be running her fingers through some money. The city has agreed to write a check to Michelle Lam, the owner of Spring Thyme – a massage and acupuncture spa on Montague St. in Brooklyn Heights – after she agreed to drop the suit. “All the parties are satisfied,” said Lam’s lawyer, Richard Cardinale…

The Bloomberg administration sent settlement notices yesterday to tens of thousands of people who were illegally strip-searched in at least six different New York detention centers between 1999 and 2002. It is the second time in five years that the city has settled a lawsuit because of strip-searches. The latest settlement, which was finalized in May, ends a class-action lawsuit brought on behalf of some 40,000 people, all of whom were arrested for misdemeanor violations, arraigned, and strip-searched as they entered detention centers, including Rikers Island.

The city has agreed to pay as much as $30 million to thousands of New Yorkers who were illegally strip searched after being busted on minor charges, the Daily News has learned.

An independent city agency has found evidence suggesting that officers may frequently be conducting inappropriate strip searches.

Near the warren of cells that smelled of feces and vomit, the woman did not quite believe what was happening. She had been arrested in 2001 in Brooklyn on a minor charge and now, in a room with an open door, a police officer had asked her to strip naked and squat. “She used her finger to examine me internally,” the woman testified at a deposition. That same year, a Haitian man had been arrested for a misdemeanor because of a dispute with a tenant. He also said he had to remove all his clothes, this time in front of laughing officers asking him to bend down.

Class Action Strip Searches May Proceed

Toby Cohen had not committed a crime, but the freelance writer was packed off to Rikers Island one day two years ago in handcuffs and shackles. She was strip-searched and forced to shower in a cold stall, then subjected to a painful gynecological exam. That was followed by five days behind bars.

Five women who were arrested on minor offenses charge they were forced to strip and submit to gynecological exams at Rikers Island. “It’s degrading and it’s humiliating,” said Richard Cardinale, a lawyer who filed a class-action suit last week in Manhattan Federal Court on behalf of the women.

It’s Staten Island’s version of the Hatfields and the McCoys – and it’s about to become a federal case. For five years, there’s been no fence strong enough to make good neighbors out of housewife Rosa Moscova and Police Officer Martin Foley, who live across from each other on a quiet, leafy street in Dongan Hills.