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Solomon Dwek, crooked developer turned FBI informant, pleads guilty in $50M fraud

Solomon Dwek, the man who helped the government pull off the biggest public corruption bust in New Jersey history, technically is looking at eight to 10 years in federal prison for his cooperation after pleading guilty to fraud and other charges in federal court in Newark this morning. But a judge could chop that down, given the size of the fish that Dwek helped investigators catch.

Photo Credit: Cliffview Pilot


Solomon Dwek

Government agents arrested Dwek three years ago, after he deposited a bad check for $25.2 million at a drive-through bank window at the Shore and PNC bank accused him of swindling $50 million. As complaints mounted from people who said Dwek had conned them out of enormous sums of money, his options for avoiding prison shrank.

So he agreed to help the federal government pull off a massive sting, one that made “Abscam” look like a traffic bust.

Posing as a law-breaking contractor, Dwek paid bribes in recorded transactions with several North Jersey mayors and public officials, the FBI said. He also particpated in the investigation of an international ring involving Sephardic rabbis who laundered millions of dollars through charitable, non-profit groups.

The government charged Dwek with bank fraud on May 11, 2006 and that was the last anyone heard of him — until agents made a series of arrests on and around July 23. CLIFFVIEWPILOT.COM was the first to identify Dwek as the key figure in the case (See: Meet the cooperator behind N.J.’s biggest corruption bust ever)

All told the FBI arrested 44 people, seven who pleaded guilty to public corruption and other charges.

Because Dwek was an unknown in this area, he was a natural for the sting. For instance, neither Peter Cammarano, then the Hoboken mayor for all of three weeks, nor Michael Schffer, a North Hudson Utilities Authority commissioner, knew who he was during a series of meetings at the Malibu Diner. Each time, Dwek gave Schaffer envelopes stuffed with cash from his car trunk, the FBI says. (See: For upstart mayor, it all began at the Malibu Diner)

The government says he made similar payoffs to Secaucus Mayor Dennis Elwell, Ridgefield Mayor Anthony Suarez, Assemblyman L. Harvey Smith (D-Hudson), Assemblyman Daniel Van Pelt (R-Ocean), and Jersey City Deputy Mayor Leona Beldini.

Dwek, 37, pleaded guilty today to bank fraud and money laundering charges in connection with his scheme to defraud PNC Bank of more than $50 million.

U.S. District Judge Jose L. Linares continued his release on a $10 million pending a Feb. 9 sentencing — when, presumbly, the outstanding cases will have been resolved.

Based on an agreement between the government and Dwek, he is formally accepting from 108 to 135 months in federal prison. However, federal sentencing guidlines give Linares discretion to “adjust downward,” in legal parlance.

A state judge is overseeing the sale of Dwek’s empire, in excess of 350 properties in seven states, to pay the $338 million that creditors say they’re owed. Dwek’s attorney originally called it a business dispute and not a crime.

Dwek admitted going to a drive-through window at PNC’s Eatontown branch and convincing the manager to accept a $25.2 million check written on a closed account, promising the money was being wired to cover it.

Dwek told the judge he deposited another $25 million check written on the same closed account later than day at another PNC branch, which soon voided the check.

From there, the victims began to mount, as did the losses — into the hundreds of millions. Even his uncle filed a claim against Dwek, whose parents founded the Deal Yeshiva, a Jersey Shore religious school that teaches Sephardic Jewish children.

Soon after, government agents got hold of him.

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