Rabbi Pleads Guilty

Thomas MacMillan FIle PhotoHe was the last defendant standing after the feds took down a mortgage fraud ring last year, and had promised to keep fighting charges that he helped swindle lenders out of millions in phony mortgages. But Rabbi David Avigdor finally copped a plea Tuesday in federal court.

The guilty plea marks a turnaround for Avigdor, New Haven’s longest-serving pulpit rabbi. He was the only one of six defendants at a federal mortgage fraud trial last year to take the stand and proclaim his innocence. He was also the only defendant to get off, when a jury couldn’t decide on his fate.

The feds had promised to retry him, and Avigdor, protesting his innocence, geared up for a rematch. Tuesday’s plea put an end to that. Avigdor pleaded guilty to one count of making a false statement to the Department of Housing and Urban Development (HUD) on a mortgage form. He now faces a maximum of one year in prison and a fine of $100,000.

Avigdor was part of a 14-member mortgage fraud ring that bilked government and private lenders out of $4.75 million. The members of the ring did it by falsely inflating the price of homes, paying “straw buyers” to take out mortgages using trumped-up income and employment records, using the mortgage money to buy the homes for their actual prices, then pocketing the difference and walking away. The scheme left a trail of blighted properties through New Haven and elsewhere.

Avigdor, a lawyer, acted as the “settlement agent” for some of these transactions. He admitted Tuesday to deceit in one sale, according to the Connecticut U.S. Attorney’s office. But he said he didn’t know the extent of the scheme.

Avigdor was the settlement agent for the $160,000 sale of 211 Lloyd St. by Marshall Asmar—a convicted conspirator—to Alicia Martineau—a convicted straw buyer. Avigdor signed a HUD-1 form stating that Asmar would receive $144,763.42 from the sale. He certified that the form was “true and accurate account of this transaction. I have caused or will cause the funds to be disbursed in accordance with this statement.”

But he didn’t do as he had promised. He transferred only $93,000 to Asmar, and sent $49,375 to Sheda Telle Construction, the fake construction company the conspirators had invented as a cover. In doing so, he was following instructions given by former alderman Morris Olmer—a convicted conspirator.

“Avigdor admitted in court that he made the statements on the HUD-1 with disregard of whether the statements were true or false, and with an intent to deprive the [Federal Housing Administration] of the information necessary to make a decision on whether to insure the loan,” states a release from the U.S. Attorney. “He represents that he was unaware that Sheda Telle Construction was fictitious, but admits that there were red flags about the transaction to which he turned a blind eye.”

As part of his plea agreement, Avigdor will surrender his law license for year and has agreed not to represent buyers or banks in real estate closings ever again. He’s also agreed to make a $20,000 restitution payment before his June 29 sentencing date.

Previous coverage of this case:

Mortgage Fraud Mastermind Gets 10 Years
“Big Liberal” Gets 5 Years For Ripping Off Poor
White-Collar Criminals Sent To Slammer
Judge Baffled By Two Morris Olmers
Feds Will Retry Avigdor
4 Convicted In Fraud Scam; Mistrial For Rabbi
Jury Can’t Agree In Scam Trial
Avigdor’s Final Plea: Follow The Money
Claire: The Rabbi Is Kosher
Wednesday The Rabbi Took The Stand
Straw Buyer Lured Into A Wild Ride
After Big Fish Plead, Smaller Fry Point Fingers
Slum-Photo Doctor Makes A Call
What Happened At Goodfellas Didn’t Stay At Goodfellas
Fraud Trial Opens With Oz-Like Yarn
“Partying” MySpacer Lined Up Scam Homebuyers
“Straw Buyer” Pleads Guilty
Neighbors, Taxpayers Left With The Tab
FBI Arrests Police Commissioner, Slumlord, Rabbi
One Last Gambit Falls Short
Was He In “Custody”?
Is Slum Landlord Helping The FBI?
Feds Snag Poverty Landlord
Police Commissioner Pleads

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Comments

posted by: OccupyTheClassroom on March 21, 2012  5:13pm

What did this cost the city of New Haven? A sense of Pride.

posted by: RCguy on March 22, 2012  2:29pm

This is a step in the right direction. Schemes like this do a lot more damage to neighborhoods than is immediately apparent. Imagine if we were to investigate what crimes took place in any of the abandoned homes that this man signed off on? It’s a long shot, but I am willing to bet that numerous lives were harmed inside the properties that were in question, at the time they were being flipped and abandoned.

posted by: Angelo's Homegirl on March 22, 2012  3:27pm

My friend Angelo has once again been indicted on yet another arson charge:

“State police charged Angelo Reyes this week in connection with a 2008 fire at 211 Lloyd St. Bail was set at $200,000. He already was jailed in lieu of $1 million bail in connection with several other fires state investigators claim he ordered for business purposes or profit.” (New Haven Register Online 3/22/12)

My question is…was the fire before or after the mortgage fraud scheme took place?

posted by: mm on March 23, 2012  7:35am

@Angelo’s Homegirl

The fire Angelo is accused of setting occurred in 2008, BEFORE the fraudulent transaction which sold the home to Marshall Asmar on Sept. 9, 2009.

Date of the sale involving the ‘mortgage fraud scheme’ is taken from the Assessor’s on line data base

posted by: Angelo's Homegirl on March 23, 2012  8:38am

Ooohhh….thanks for clarifying that mm