Solomon Dwek Sentenced to 6 Years in Prison for Bank Fraud and Money Laundering
Dwek cooperated with law enforcement investigations
Solomon Dwek, a Monmouth County-based real estate developer and the owner of properties in Monmouth and Ocean counties who pleaded guilty to bank fraud and money laundering in 2009 was sentenced today to six years in prison.
Judge Jose Linares handed down the sentence in Newark after hearing final arguments from the prosecutors and defense attorney in Dwek's trial.
Dwek was facing nine to 11 years under his plea deal for his crimes, but his cooperation with federal investigators over the last few years helped him receive a reduced sentence.
Dwek's time as an informant led to the arrest of 46 people including local government officials and rabbis, including Rabbi Eliahu Ben Haim of Long Branch and Joseph Kohen, a former mortgage broker from Deal.
Dwek and Kohen schemed to defraud PNC Bank of more than $50 million nd to launder approximately $22.8 million of the proceeds through other banks, which included paying off an overdue and fraudulently obtained $20 million line of credit at HSBC Bank USA, N.A. (HSBC).
According to a release from the Department of U.S. Attorney's Office:
Dwek and Kohen schemed to defraud PNC Bank by presenting, on April 24, 2006, a $25,212,076 check drawn on a Dwek-controlled account in the name of Corbett Holdings at a PNC Bank branch in Eatontown. Dwek wanted the check deposited into another PNC account that he controlled in the name of SEM Realty Associates LLC. After a PNC Bank official advised him that the Corbett Holdings account was closed with a zero balance, Dwek falsely represented that “corporate” was reopening the account and that a wire transfer of funds into the Corbett Holdings account would be forthcoming, which did not occur. Dwek’s check was honored and deposited.
The next day, Dwek phoned in four wire transfers out of the SEM Realty account to various other banks, including $20 million and $2.2 million wire transfers to HSBC, according to Dwek. The $20 million wire transfer to HSBC was for the purpose of paying off an overdue and fraudulently obtained $20 million line of credit that he received from HSBC, which he had fully drawn down. As a result, the SEM Realty account was overdrawn by $22.8 million.
On April 25, 2006, Dwek presented another bogus $25 million check to be drawn on the same Corbett Holdings account for deposit into the same SEM Realty account at a PNC Bank branch in Asbury Park. This check was not honored or deposited by the bank. Dwek made a number of false statements and representations to cover up this scheme, including falsely advising a PNC bank official that he was expecting a wire transfer from an attorney that would cover the $25,212,076 check drawn on the Corbett account. Dwek later called back the PNC official and had Kohen pose as the attorney and falsely tell the bank official that he would make a wire transfer to cover the $25 million check. The wire transfers of these fraudulently obtained proceeds to HSBC, as well as two other wire transfers of $580,000 and $10,000 to other banks, was money laundering.
Kohen pleaded guilty to bank fraud on March 21, 2007. He was sentenced to 30 months in prison by Judge Linares. Dwek was charged with bank fraud on May 11, 2006, in a criminal complaint.
He cooperated with law enforcement in an investigation of pre-existing money laundering networks that operated internationally among New York, New Jersey, Israel and other locations and laundered millions of dollars through charitable, non-profit entities. This cooperation led to the conviction of, among others, five rabbis, on money laundering and unlicensed money remitting charges. Among those convicted were Rabbi Ben Haim, the former chief rabbi of Congregation Ohel Yaacob in Deal, N.J., and Rabbi Mordchai Fish, the former chief rabbi of Congregation Sheves Achim in Brooklyn.
District Judge Joel A. Pisano sentenced Ben Haim to 60 months in prison in January, 2012 and sentenced Rabbi Mordchai Fish to 46 months in prison on July 3, 2012.
Dwek’s cooperation also led to the first-ever conviction for organ trafficking under the National Organs Transplant Act of 1984. Levy Izhak Rosenbaum of Brooklyn pleaded guilty to three counts of organs trafficking and one count of conspiracy to commit organ trafficking and was sentenced to 30 months in prison on July 11, 2012, by U.S. District Judge Anne E. Thompson in Trenton.
Law enforcement officials also used Dwek to investigate public corruption in New Jersey. Those investigations led to convictions against numerous individuals for public corruption, including Hoboken Mayor Peter Cammarano, who was sentenced to 24 months in prison on Aug. 5, 2010; Secacus Mayor Dennis Elwell, who received a term of 30 months in prison on April 12, 2012; Jersey City Council President Mariano Vega Jr., who received a sentence of 30 months in prison on April 11, 2011; and Jersey City Deputy Mayor Leona Beldini, who received a prison term of 36 months on June 14, 2010. All four defendants were sentenced by Judge Linares.
In addition, Assemblyman Daniel Van Pelt of Ocean County was convicted at trial before Judge Pisano and sentenced to 41 months imprisonment on Nov. 22, 2010.
In addition to the prison term, Judge Linares sentenced Dwek to five years of supervised released and ordered restitution of $22.8 million.
Dwek also is scheduled to appear in state Superior Court in Freehold, at 9:15 a.m. tomorrow for sentencing on state charges.