July 23, 2009
Big political corruption busts in New Jersey . . . thanks to a cooperator
The Wall Street Journal provides this extended account, which is headlined "Dozens Arrested in New Jersey Corruption Probe," of a huge political corruption story breaking today in New Jersey. Here is how the piece starts:
Federal agents swept into New Jersey towns across several counties Thursday morning, charging 44 people, including mayors and rabbis, in a federal investigation into public corruption and a high-volume, international money-laundering conspiracy.
The arrests in the corruption probe included Peter Cammarano III, the newly elected Democratic mayor of Hoboken; Dennis Elwell, mayor of Secaucus, also a Democrat; state Assemblyman Daniel Van Pelt, a Republican; and Democrat Leona Beldini, the deputy mayor of Jersey City. Those arrested were expected to be arraigned in court Thursday afternoon.
The key to the investigation was an Orthodox Jewish real-estate developer, according to a person familiar with the matter. Solomon Dwek was arrested on bank-fraud charges in 2006 and was forced to seek bankruptcy protection for himself and his companies, which owned about 300 residential and commercial properties. Mr. Dwek, 36 years old, a religious-school head and philanthropist from Ocean Township, was charged with defrauding PNC Bank out of $25 million. Mr. Dwek remained free on a $10 million bond. A lawyer for Mr. Dwek couldn't be reached for comment.
To ensnare most of the defendants, the Federal Bureau of Investigation used Mr. Dwek to attempt to bribe numerous public officials in New Jersey, including Hoboken and Jersey City, according to a person familiar with the matter. The probe roped in several other real-estate developers who also wanted to bribe officials. The criminal complaints unsealed Thursday referenced an unnamed "cooperating witness" who represented himself as a real-estate developer seeking to pay bribes. A person familiar with the matter said Mr. Dwek is the witness.
This may not seem like a sentencing story yet, but it already is in various ways. First, the threat of a long prison term that Solomon Dwek was likely facing on bank-fraud charges in 2006 surely played a role in his decision to become a "cooperating witness." Relatedly, the "44 people, including mayors and rabbis" who were arrested today will surely be told ASAP that the best way they can reduce their sentencing exposure is to be as cooperative as Solomon Dwek.
July 23, 2009 at 02:37 PM | Permalink
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Were payments made to the officials or to their campaigns? In return for what? How can a local official assist with a bank fraud charge?
Posted by: Supremacy Claus | Jul 23, 2009 4:12:56 PM