July 27, 09

NEWS / MASSIVE CORRUPTION BUST Mayors, Rabbis, Politicians, and More

As the buses pulled up to our Newark office yesterday morning carrying 44 prominent political and religious leaders—including mayors, assemblymen, and rabbis—it would have been easy to mistake them as a group of visiting VIPs.
Instead, they were the defendants in a two-track criminal investigation, arrested by our agents during an early morning sweep and charged with political corruption and high-volume international money laundering.

“The list of names and titles of those arrested today sounds like a roster for a community leaders meeting,” said Weysan Dun, special agent in charge of our Newark office. “Sadly, these prominent individuals were not in a meeting room but were in the FBI booking room.”

Three New Jersey mayors, two state legislators, numerous political operatives, and five well-known rabbis from New York and New Jersey were among those arrested. Charges include politicians accepting cash bribes and rabbis laundering millions of dollars through their tax-exempt charitable organizations. One defendant allegedly conspired to broker the sale of a human kidney for a transplant at a cost of $160,000.

With the assistance of a cooperating witness, we infiltrated a money laundering network that operated internationally between New York, New Jersey, and Israel and laundered tens of millions of dollars through charitable non-profit groups controlled by the rabbis.

In one method of laundering, our undercover witness would write a check to the rabbi’s charitable organization—anywhere from tens of thousands of dollars to more than $150,000—and the rabbi would then return the amount of the check in cash, less a 10 percent cut for himself. Defendants in Israel provided large sums of cash for these transactions. The money was kept in “cash houses” in Brooklyn.

When our witness was later introduced to a Jersey City public official, it led to the discovery of a network of corruption that became the second phase of our investigation.

Among those arrested:

* The newly elected mayor of Hoboken, charged with accepting $25,000 in cash bribes, including $10,000 last week from an undercover cooperating witness.
* A New Jersey assemblyman and recent mayoral candidate in Jersey City, charged with taking $15,000 in bribes to help get approvals from high-level state officials for building projects.
* The chief rabbi of a synagogue in Brooklyn, charged with laundering proceeds derived from criminal activity.

Most of the defendants were arrested by agents from our Newark office and from the Internal Revenue Service, who were working in collaboration with the U.S. Attorney’s Office in New Jersey. Search warrants were executed at approximately 20 locations in the region to recover large sums of cash and other evidence. The investigation produced hundreds of hours of video and audio recordings documenting much of the money laundering and bribe-taking.

At a press conference yesterday in Newark, Special Agent in Charge Dun said of the arrests, “We hope that our actions today will be the clarion call that prompts significant change in the way business and politics are conducted in the state of New Jersey. Those who engage in this culture of corruption should know the cross hairs of justice will continue to be focused on them.”

Tags: criminal investigation, document,