Freehold, NJ - Dwek Uncle Says Bank May Have Suspected Fraud In Land Purchases
Freehold, NJ - HSBC Bank had "serious concerns'' about properties Solomon Dwek was claiming to buy, according to an uncle who had taken out a $25 million loan from the bank for the purchases.
Joseph Dwek, 54, of Brooklyn, made the claim in legal papers filed in Superior Court saying he was defrauded by Solomon Dwek. He said that he borrowed a total of $43 million from HSBC and gave it to Dwek, 33 of Ocean Township, in the second half of 2005 to invest in properties in and around Monmouth County. An HSBC spokesman could not be reached for comment. Joseph Dwek said in April that HSBC raised "serious concerns'' about the properties, noting that there were discrepancies on the addresses Solomon Dwek said he was planning to buy. ""HSBC suggested there may have been fraudulent activity,'' Joseph Dwek stated in the court papers.
The uncle said he did not know until a short time later that none of the purchased properties was placed in his name. Solomon Dwek held all the properties either in his own name or through corporations, Joseph Dwek stated. Joseph Dwek's court statement was made to refute allegations by PNC Bank, which is suing Solomon Dwek for $21 million, that the transfers were fraudulent.
Joseph Dwek, 54, of Brooklyn, made the claim in legal papers filed in Superior Court saying he was defrauded by Solomon Dwek. He said that he borrowed a total of $43 million from HSBC and gave it to Dwek, 33 of Ocean Township, in the second half of 2005 to invest in properties in and around Monmouth County. An HSBC spokesman could not be reached for comment. Joseph Dwek said in April that HSBC raised "serious concerns'' about the properties, noting that there were discrepancies on the addresses Solomon Dwek said he was planning to buy. ""HSBC suggested there may have been fraudulent activity,'' Joseph Dwek stated in the court papers.
The uncle said he did not know until a short time later that none of the purchased properties was placed in his name. Solomon Dwek held all the properties either in his own name or through corporations, Joseph Dwek stated. Joseph Dwek's court statement was made to refute allegations by PNC Bank, which is suing Solomon Dwek for $21 million, that the transfers were fraudulent.
posted by VOS IZ NEIAS @ 6/08/2006 07:49:00 AM
3 Comments:
At 8:46 AM,
Anonymous said…
Why do we have to publish Loshon Harah? I do not see any halachic reason to post these kind of messages.
At 1:21 PM,
Anonymous said…
Solomon Dwek's plans to grow his real estate empire to Wallace Street in Red Bank have apparently gone astray.
Now, a total of $550,000 that Dwek had chipped in as a member of a limited liability corporation hoping to acquire the former Dorn's Photography site at 23 Wallace St. is held in trust by Donald M. Lomurro, the Freehold Township attorney overseeing the fiscal affairs of the financially troubled Ocean Township businessman.
"I've received the money," said Lomurro, who was appointed by state Superior Court Judge Alexander D. Lehrer on May 12 to oversee Dwek's portfolio of more than 350 investments and the hundreds of claims against it.
A court order to refund $475,000, that Dwek had given to two partners in the unnamed LLC last winter as a down payment on the Dorn's site, plus an additional $75,000 fee, was signed by Lehrer on May 31.
A copy of that document as well as the filing by Lomurro asking Lehrer to allow Dwek's down payment to be put in the trust account is posted on the New Jersey State Judiciary Web site.
The proposed contract purchase of 23 Wallace St., which is currently pending sale by the Dorn family to Red Bank-based River Development, is just one of many unfinished real estate deals that Dwek, 33, had become engaged in before his well-publicized financial and legal woes began in late April, Lomurro said.
Because Dwek owes more than $298 million to various creditors, fellow investors and business partners, including the $25.2 million that he is accused of fraudulently obtaining from PNC Bank, Dwek cannot secure credit or participate in the Wallace Street deal or any other outstanding property purchases, Lomurro explained.
"[Dwek] can't fulfill his obligation," Lomurro said of the businessman whose assets were frozen by Lehrer on May 3.
Lomurro said that he did not know that 23 Wallace St. is the site of the Dorn's complex, which closed last year after being in operation since 1935.
He also said that he was unaware that River Development is buying the property for its own planned redevelopment project.
In addition, Lomurro said that he does not know if it was River Development or another party that Dwek and the other five investors in the LLC might have been dealing with when they were eyeing the 23 Wallace St. site.
River Development's site plan, as approved in June 2005 by the Red Bank Planning Board, called for a four-story mixed-use structure at 15-25 Wallace St., a stretch that includes the buildings that once housed Dorn's operations.
Dwek and the other LLC members had not completed the purchase of 23 Wallace St., Lomurro confirmed.
"The deal wasn't closed," Lomurro said.
In short, Dwek, who was stripped of control over his affairs by Lehrer on May 19, needs cash and needs to re-establish his credit with any lenders, Lomurro explained.
Lomurro is holding any money refunded to Dwek for any incomplete purchases in the court-approved trust.
Dwek is also accused of attempting to defraud PNC Bank of a total of $50 million via two separate transactions on April 24 and 25.
A copy of the court order releasing the funds to the trust account names Harvey Schultz, Jonathan Schultz, Steven Schultz, John Saraceno and Michael V. Benedetto as fellow investors in an LLC involved in "the proposed purchase of property commonly known as 23 Wallace Street, Red Bank, N. J. ..."
Between December and February, Dwek gave a total of $475,000 to Harvey Schultz and Benedetto to be used as a down payment, according to a copy of the court filing dated May 24 submitted for Lehrer's approval by Lomurro.
Benedetto is an attorney in the Ocean Township firm of Ansell, Zaro, Grimm and Aaron. At press time, he had not returned calls for comment made to the firm's offices.
A copy of the proposed court order, posted by Lomurro on the state judiciary Web site, shows that Dwek's attorney, Robert Weir of Red Bank, had recently requested the return of the $475,000 down payment to his client "as Solomon Dwek can no longer continue in the project."
"Mr. Schultz and Mr. Benedetto were to be responsible for architect and engineering fees that were necessary for the buildings to obtain municipal approvals," Lomurro wrote.
The additional $75,000 tagged onto the $475,000 down payment is for "utilization of his capital for this period of time," Lomurro wrote.
"We felt that was a very fair deal," Lomurro said in the interview.
Weir has not returned telephone calls seeking comment.
Dwek's attorney in his real estate dealings is John Wopat III of Red Bank, according to Lomurro.
Wopat did not return telephone calls seeking comment by press time.
As of Friday, Red Bank's tax records show that the Dorn family is still the owner of record of 23 Wallace St.
Daniel Dorn Jr. stated on Monday that the closing with River Development is expected to take place by the end of June.
To date, no building permits have been issued to River Development, according to Donna Barr, Red Bank's director of planning and zoning.
Paul Ryan, a principal in River Development, indicated on Friday that his company does intend to go forward with the planned development between 15 and 25 Wallace St.
He referred all other inquiries pertaining to 23 Wallace St. and any involvement by Dwek to Christine Burke, the firm's media spokeswoman.
Burke declined to comment about any transactions between River Development and Dwek's LLC because of the "active investigation" regarding the real estate mogul's affairs.
Harvey Schultz, Steven Schultz and Jonathan Schultz are principals in the Schultz Organization/TCN Worldwide, based in Woodbridge, Middlesex County, according to the real estate corporation's Web site.
It is unclear if the Schultz Organization is involved in trying to purchase the former Dorn's site. Several telephone calls made to the company's offices had not been returned at press time.
Dwek has an interest in Red Bank Gas LLC, which owns property at 80 Rector Place as well as 7 Broad St. and the Restoration Hardware building at 45 Broad St.
In the wake of bank fraud charges filed by PNC, Dwek was arrested at his Ocean Township home by FBI agents on May 11. He remains free on a $10 million bond secured by the equity in the Ocean Township homes of his mother-in-law and sister-in-law.
At 7:25 AM,
Anonymous said…
"L.P. said...
Why do we have to publish Loshon Harah? I do not see any halachic reason to post these kind of messages."
Maybe the folks down in Deal, NJ, where Dwek's father is a well-known rabbi, can appeal to him to ask his son to stop with the shady business dealings, like the apparently phony deposits to PNC. Even if what he was doing was technically legal (highly doubtful) or is somehow permitted under Halacha, (also highly doubtful), it's still maris ayin (appears to be wrong) and creates Chillul Hashem (desecrates G-d's Name) since he is identifiably frum. People with identifiably Jewish names, or who are clearly known as Jews, particularly religious ones, have a special obligation to always appear absolutely above suspicion and to not even come near anything that could be misconstrued as shady dealings, for the same reason that an identifiably frum guy should not be seen hanging around on the street in front of a porno establishment, even if he is only innocently waiting for a bus (walk a block and catch the bus on the NEXT corner). You prevent Chillul Hashem not by invoking "loshan harah" and refusing to disseminate a story so people don't know what's happening -- but by being careful not to get involved in something that's going to look treif (andwhich probably is) in the first place.
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