News By Tag
* New Jersey
* Money Laundering
* Bank Fraud
* New York
* Pnc Bank
* More Tags...
* New jersey
* New york
* More Industries...
News By Location
New Jersey Criminal Corruption Sting Largest In History
Dwek apparently spent 29 months as a cooperating witness, setting up rabbis and others in the religious community, as well as leaders which included sitting mayors, current political candidates and public officials
As Mr. Dwek stood before U.S. District Judge Jose L. Linares in Newark in his less than 30-minute appearance he entered pleas to separate counts of bank fraud and money laundering in connection with two bogus checks totaling more than $50 million that he tried to deposit at the PNC Bank.
"I am guilty your honor," he declared, firmly and without hesitation. Later in Monmouth County, the scene was repeated before Superior Court Judge Thomas Scully in Freehold, where Dwek pled to similar state charges.
Many people are wondering about who Dwek really is and want to know more about him and the explosive details about his private con schemes and his role as the cooperating witness in one of the biggest ongoing federal corruption investigation ever where finally some details are starting to come to light.
The 2006 scheme is how Dwek originally came to the attention of federal prosecutors, who then turned him into an informant. Following his arrest, Dwek apparently spent 29 months as a cooperating witness, setting up rabbis and others in the religious community, as well as leaders which included sitting mayors, current political candidates and public officials on charges ranging from political corruption to money laundering in an undercover sting operation that prosecutors have called unprecedented in its scope.
Allegedly, Dwek snared 45 people in the sting, of the 45, so far seven -- all from Hudson -- have pleaded guilty. Those who have been arrested and say they are innocent include the former mayors of Hoboken and Secaucus.
The U.S. Attorney’s office issued an advisory just before the hearing of which Dwek plead guilty saying only that "a central figure" in the July 23 arrests of 45 people on public corruption and money laundering charges would appear in federal court before U.S. District Judge Jose L. Linares in Newark. A spokesman for the office declined to answer questions. Dwek’s attorney did not return calls to our office. Dwek is described in nearly every criminal complaint and every indictment as a "cooperating witness who had been charged with bank fraud" but his name never appears in the court records and he has not appeared publicly in any court as a witness since the sting started. The first trial for those accused in the corruption sting is scheduled for January 2010, and Dwek is expected to be the main witness in the case.
In less than four years, Dwek has gone from a well-respected real estate mogul with a $300 million empire in seven states to a FBI informant, community outcast and admitted felon.
The following was reported in “The Daily Record”:
... The subjects of the arrests also include religious leaders from the Syrian Jewish enclaves in Brooklyn, Deal and Elberon. Sources said the IRS and FBI this morning seized documents from the Deal Yeshiva and the Ohel Yaacob synagogue on Ocean Avenue in Deal.
The Deal Yeshiva is a religious school which teaches children in the Sephardic Jewish tradition, The Yeshiva has two separate divisions: a boys' school on Logan Road in Ocean Township and a girls' school on Wall Street in West Long Branch.
The school was founded more than 20 years ago by Rabbi Isaac Dwek and Raizel Dwek, the parents of Solomon Dwek, of Ocean Township. Rabbi Dwek was the school's president, and Raizel was its treasurer, until 2006, when their son's real estate empire began to crumble after Dwek deposited a bad $25.2 million check at a drive-through window at the PNC Bank in Eatontown. ...
Now the second wave of stories is suggesting that Dwek may actually be the key witness in many other arrests.
Here's a report from Bloomberg:
... The cooperating witness is Solomon Dwek, a real estate developer in Monmouth County, New Jersey, who was charged May 11, 2006, with scheming to defraud PNC Bank out of $50 million, according to a person familiar with the matter and court records.
Prosecutors alleged that Dwek deposited two $25 million checks from another account of his, which had a zero balance. Dwek then wired $22.8 million out of PNC, falsely assuring bank officials that he would forward funds to cover the overdraft, according to prosecutors.
Dwek posted a $10 million bond, secured by $3 million in equity in the homes of his mother-in-law and sister-in-law. Dwek was never indicted, instead receiving 17 extensions from a judge to continue the period in which his case had to be presented to a federal grand jury. ...
An Asbury Park Press investigation indicated that people who knew Dwek say he was wealthy, private, quiet, easy going and a pillar of the community. Business associates believed him to be a respected leader of a religious school, a successful real estate investor, a philanthropist and a devoted father of five. But according to court documents Dwek’s real estate empire may have been built on a foundation of crime which included money-laundering, bank fraud and lies.
How could his empire expand so fast and collapse even faster? And how could major banks, lenders, investors and even family members have been so blind to provide millions of dollars to a man they now say owes them more than $338 million?
Star Ledger reported that there examination of court documents it showed before Dwek became an informer for the FBI, he was running a wild Ponzi operation in which one investment was being used to pay off the debt mounting from the last one and on into the millions in the same kind of geometry that eventually exposed financier Bernard Madoff. The documents also seem to show that once Dwek turned informant he was so good at his work -- money launderer to religious leaders, bribe-taking developer to politicians -- that some of his targets seemed to be virtually throwing money at him.
In an amended bankruptcy petition, Dwek disclosed almost $500,000 in 20 separate secret payments:
There was $75,100 from a former partner, "left in a garbage bag behind his office."
And another $28,400, labeled as "kickbacks for the sale of Florida properties."
Some $9,000 in deposits returned on a cancelled deal for two condominium units located in Miron, Israel.
And $5,000 that were listed as "fictitious charitable donations given through Solomon Dwek's American Express card."
According to other court filings, investors were led to believe that Dwek would buy properties and simultaneously flip those sales to what turned out to be fictitious third parties at a higher price.
In another part of the scheme described in a series of lawsuits filed by the trustee, Dwek allegedly paid off Eli Seruya, the comptroller of his uncle's business, to facilitate the fraudulent deals being made through the company. The trustee described gifts to Seruya of a new Lexus, partial payments on nine condominiums in Israel, and transfers through Dwek's American Express account in excess of $1.3 million to a synagogue where the controller's brother was a rabbi and he had access to its accounts, and had the ability to write checks to himself, the court documents charge.
# # #
The world's oldest on-line news gathering & information source dedicated to raising public awareness with free expression