Operation Bid Rig is an ongoing, long-term investigation into political corruption in New Jersey conducted by the Federal Bureau of Investigation, the Internal Revenue Service, and the United States Attorney for the District of New Jersey since 2002.
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The investigation has resulted in the indictments of more than 60 public officials and politically connected individuals since its inception. In July 2009, sting operations resulted in the arrest of 44 people in New Jersey and New York, including 29 public servants and political operatives, and five orthodox rabbis from the Syrian Jewish community. A number of high-level New Jersey elected officials were arrested in the operation, including Jersey City Deputy Mayor Leona Beldini, Hoboken Mayor Peter Cammarano, Secaucus Mayor Dennis Elwell, Ridgefield Mayor Anthony R. Suarez, former Jersey City Housing Authority Commissioner and Chairwoman Lori Serrano, Jersey City Housing Authority Commissioner Edward Cheatam, Assemblyman L. Harvey Smith, Assemblyman Daniel M. Van Pelt, former Assemblyman and unsuccessful mayoral candidate Louis Manzo, and political operatives Joseph Cardwell and Jack Shaw.
Background
Operation Bid Rig originated with investigations of public corruption among New Jersey officials in Monmouth and Ocean counties. The first phase became public in 2002 when former Ocean Township Mayor Terrance D. Weldon pleaded guilty to extorting cash from developers to influence the approval of building projects. The second phase of the investigation resulted in the February 2005 arrests of 11 elected officials in Monmouth County, who were charged with taking bribes from an undercover cooperating witness.
Operation Bid Rig II
The second phase of the investigation was conducted in 2003 and 2004. Robert "Duke" Steffer, a former developer in New Jersey and Florida, solicited public officials for projects for his company, Steffer Industries Inc., which was later found to be a shell created by investigators.
The investigation snared more than 12 public officials including:
Operation Bid Rig III
The third phase of the investigation—Operation Bid Rig III—began after an individual identified by news sources as real estate developer Solomon Dwek of Ocean Township was arrested on charges of committing $50 million in bank fraud in May 2006. Dwek, a well-known member of the Syrian Jewish community whose parents founded the Deal Yeshiva, agreed to become a cooperating witness for the FBI, infiltrating a money-laundering network connecting Israel and Syrian Jewish communities in Brooklyn and Deal, New Jersey. This network has allegedly laundered tens of millions of dollars through charitable non-profit organizations controlled by rabbis in New York and New Jersey. Among the rabbis implicated are Saul J. Kassin of Congregation Shaare Zion in Brooklyn, Eliahu Ben Haim of Congregation Ohel Yaacob in Deal, and Edmond Nahum of the Deal Synagogue.
According to criminal complaints, Dwek (identified as "CW" for "cooperating witness"), informed targets of the sting that he was bankrupt and trying to conceal his assets, claiming involvement in illegal businesses including the sale of counterfeit Gucci and Prada handbags, as well as insurance scams and bank frauds. The targets accepted checks made by Dwek made out to their charitable foundations and returned the money to him after deducting a fee. Much of the cash they provided him came from Israel, and some of that in turn came from a Swiss banker, prosecutors said. Prosecutors said that about $3 million had been laundered for Dwek since the beginning of the third phase of the operation in June 2007, much of the money coming from Israel.
The case shifted to focus on public corruption after one of the men accused of money laundering, Moshe Altman of Monsey, New York, a Hudson County developer, introduced Dwek to a politically connected building inspector in Jersey City, who then steered him to another city official, Maher Khalil. Khalil, who is accused of accepting $30,000 in bribes from Mr. Dwek, introduced Dwek to a web of public officials, mayoral and council candidates, and their confidants, whom he called "players"
On July 23, 2009, Acting United States Attorney for the District of New Jersey Ralph J. Marra, Jr. announced the arrest of the following 44 people: