Solomon Dwek, v.p. of Deal Yeshiva, charged with bank fraud
BY SUE MORGAN
Staff Writer
Solomon Dwek’s $100 million offer to purchase the 117-acre Deal Golf and Country Club last fall was one its members could – and did – refuse.
Dwek, the Ocean Township-based real estate mogul, who now faces federal charges of attempting to defraud PNC bank of over $50 million, had coveted the member-owned country club’s rolling greens and unsuccessfully attempted to buy the golf course off Roseld Avenue for ten times its assessed value, according to Ocean Township Councilman Christopher Siciliano, a golf club member.
“Solomon Dwek was one of the bidders and the catalyst behind a possible sale,” Siciliano said in a telephone interview Monday night. “He made a hefty offer.”
A majority of the club’s 300 members, Siciliano included, ultimately voted to turn down Dwek’s bid, the largest of three offered, mostly out of a desire to preserve the golf course. Twelve holes, on about 93 acres, are physically situated in Ocean Township and the remaining six holes are on 24 acres located in neighboring Deal, Siciliano explained.
“It’s a beautiful golf course in a bucolic setting,” he said.
The township’s portion of the course is assessed at $10 million – something that aroused curiosity among country club members when Dwek made his offer, Siciliano noted.
Paying much more than the property’s assessed value seemed to be Dwek’s method of operation, said Siciliano, a local real estate agent.
“He would buy high and pay more than the average person would,” Siciliano said.
His description of Dwek’s wheeling and dealing was echoed by Red Bank commercial realty broker Geoff Brothers.
“Dwek amassed a fortune in real estate. If you had a building for sale, the first call you made was to Solomon,” said Brothers, of Brothers Commercial Brokerage. “If it was a reasonable price and the numbers worked, he’d close on it.”
Dwek’s wide-ranging real estate empire and all the details about who exactly owns what pieces of it and who has money invested is expected to be on public display via a Web site due to be up and running this week on the order of state Superior Court Judge Alexander D. Lehrer, Freehold.
On Friday, facing a courtroom filled with as many as 50 lawyers representing an assortment of nervous bankers, brokers, investors, business partners and other players in Dwek’s dealings, as well as PNC representatives, Lehrer assigned Freehold Township attorney Donald Lomurro the monumental task of sorting through the claims filed against the troubled businessman’s portfolio. As of yesterday, the information should be available on the New Jersey State Judiciary Web site, according to Lomurro.
The lawyers representing those parties are to give all the information about those investments and business deals to Lomurro to be posted on the Web site, which will serve as a sort of information clearinghouse, Lehrer explained in a telephone interview on Friday.
“The purpose of the proceeding was to restore order for all of the investors, lending institutions, real estate brokers and the general public,” Lehrer said.
Lehrer confirmed that he had frozen Dwek’s assets on May 3 at the request of Pittsburgh-based PNC after the businessman had allegedly attempted to defraud the bank of a total of $50 million late last month.
Friday’s courtroom hearing was intended as a follow-up and to figure out who was involved with Dwek’s real estate affairs, the judge explained.
Lehrer asserted that with Lomurro’s guidance and advice, the claims filed against Dwek’s massive portfolio will be handled appropriately and legally and any confusion or fear associated with his business dealings will be abated.
Ultimately, it is up to Lomurro to recommend how each of the claims made against Dwek by investors and business partners will be handled, Lehrer said.
“The chaos, speculation and uncertainty will end today,” Lehrer said. “We hope that no one will be hurt,” he added.
Red Bank attorney Robert Weir, who represented Dwek before Lehrer, could not be reached for comment by press time.
Dwek, 33, who is also vice president of Deal Yeshiva in West Long Branch, was arrested May 11 at his Ocean Township home by FBI special agents on charges of defrauding PNC out of $25.2 million when he deposited a bad check written on one of his business accounts for that amount at the Eatontown branch on April 24.
The U.S. Attorney’s Office has also charged Dwek with attempting to defraud PNC out of an additional $25 million on April 25, when he tried to deposit a check on the same invalid business account into another account at the Asbury Park branch.
Employees at PNC’s Asbury Park branch, knowing that Dwek was trying to obtain cash from a closed account, refused to honor his check, according to the U.S. Attorney’s Office.
Earlier on the same day, Dwek transferred by wire $22,790,000 into accounts at three different banks, using the funds made available to him through the previous day’s $25 million deposit, the U.S Attorney’s Office states in the criminal complaint dated May 10.
PNC is assisting in the federal probe and hoping to recoup the funds illegally obtained by Dwek, according to Darcel Kimble of the bank’s corporate communications office in Pittsburgh.
“A thorough investigation is under way by the proper authorities, and we’re taking appropriate steps to recover the funds,” Kimble said.
The bank fraud charge against Dwek carries a maximum term of 30 years in prison and a maximum fine of $1 million, according to the U.S. Attorney’s Office.
Investigators from the Monmouth County Prosecutor’s Office, Ocean County Prosecutor’s Office and the Brick Township police accompanied the FBI agents when they apprehended Dwek at his Ocean Township home at 7 a.m. last Thursday, according to FBI Special Agent Steve Siegal.
Dwek appeared before U.S. Magistrate Judge Mark Falk in federal court in Newark later that day and was ordered to surrender his passport. 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, according to Michael B. Himmel of Roseland, his attorney in the PNC matter.
With family and business ties in both Ocean Township and Deal, Dwek, the married father of four children and one on the way, is not considered likely to flee, said Himmel of the Lowenstein Sandler law firm.
“He is absolutely not a flight risk,” Himmel said in a telephone interview on Friday.
Though he refused to comment on the specifics of the PNC matter, Himmel acknowledged that Dwek does own a variety of properties.
“He owns significant real estate in Ocean Township and other surrounding communities,” Himmel said.
According to the U.S. Attorney’s Office, Dwek owns about 100 properties in numerous Monmouth and Ocean County municipalities.
Aside from Ocean Township, real estate holdings include commercial, residential and vacant properties in Long Branch, West Long Branch, Eatontown, Red Bank and Deal.
At one point, Dwek had a minimal interest in a vacant property located in one of Long Branch’s redevelopment zones, but has recently sold it to the redeveloper, Broadway Arts Center LLC.
“The only property [Dwek] had owned in the [Broadway Arts Redevelopment] zone was at 131 Broadway,” said Todd Katz, a principal in Broadway Arts Center – the designated developer for a two-block zone in the lower Broadway redevelopment area. Katz added that Dwek was not a lead investor in the property.
“It was a vacant building, and BAC purchased it three weeks ago,” Katz said. “BAC has already closed on that property.” BAC is under no contracts for the redevelopment project that would be affected by Dwek’s legal problems, according to Katz.
Reports of Dwek’s legal and financial troubles could have their repercussions in the real estate market as a whole, Brothers pointed out.
“This is a lose-lose for everybody, a very bad thing for not only the commercial market, but the market in general,” Brothers said. “It creates a mind-set where people say, things are all bad. It establishes a posture for people that is more difficult to negotiate with,” he said.
With downward pressure building on the market and prices and demand softening, the effect of Dwek’s downfall will be far-reaching he said.
“If he ends up losing properties, people will be hurt. Unfortunately, a lot of people are going to suffer,” Brothers concluded.
Among Dwek’s holdings in Ocean Township are the empty Worden-Hoidel Funeral Home at 236 Monmouth Road and 3-acre tract at 259 Monmouth Road.
In Red Bank he was part of the investors’ group that purchased the Restoration Hardware building at 45 Broad St. and also is an owner of the mostly vacant building at 7 Broad St.
Dwek had applied to the township to construct two homes and a bank at the site of the closed funeral home, according Siciliano, who sits on the Planning Board.
Meanwhile, construction on an office building planned for 259 Monmouth Road appears stalled as only a foundation and construction trailer now sit on the site.
“We don’t want to end up like Asbury Park with a C-8,” Siciliano said, comparing the site to an unfinished building in that city that was finally imploded after sitting untouched for over 20 years.
It is best that Dwek complete whatever projects he has started in Ocean or turn them over to someone who can in order to prevent the appearance of blight, Siciliano said
“We need to make sure these get built,” he said.
In April 2005, the West Long Branch Planning Board approved Deal Yeshiva’s plan to construct two pools and a playground on its triangular-shaped lot at 200 Wall Street.
That approval was actually the second go-round for the private school’s application after it was remanded to the board following a challenge by an area resident in state Superior Court, Freehold.
– Greater Media Newspapers staff writer Christine Varno contributed to this story