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Tuesday, Jul 3, 2012 7:45 PM UTC

NY rabbi sentenced in NJ for laundering scheme

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Topics: From the Wires,

TRENTON, N.J. (AP) — A New York rabbi broke down and sobbed Tuesday as a federal judge sentenced him to nearly four years in prison for laundering close to a million dollars in what he thought were illicit funds through a religious charity.

“I have been living in shame. It is hell for me every day,” Rabbi Mordchai Fish said as he held his head in his hands during a rambling statement to the court. “I don’t blame anyone but myself. I was wrong. I was so very wrong.”

Fish was one of five rabbis arrested in a massive money-laundering and political corruption sting three years ago that stretched from southern New Jersey to the Brooklyn neighborhood where he leads Congregation Sheves Achim.

All of the rabbis and several other Orthodox Jewish community members have pleaded guilty to money-laundering conspiracy or illegal money transmitting. Fish pleaded guilty last year to money-laundering conspiracy, a crime punishable by a 20-year maximum prison sentence.

U.S. District Judge Joel Pisano could have given Fish up to 57 months under federal sentencing guidelines, but he took into consideration Fish’s work in the Orthodox community and imposed 46 months, the lower end of the sentencing range.

That bit of leniency was balanced by Pisano’s decision to push the range higher because the money-laundering scheme was sophisticated, in his opinion. Fish could have received as little as 37 months had that determination been different.

Fish admitted laundering money for Solomon Dwek, a disgraced real estate and admitted Ponzi schemer who became a government informant in 2006 after his arrest on a $50 million bank fraud. Dwek told Fish and others in the sting that the money was proceeds from the sale of illegal handbags or money he needed to hide from bankruptcy proceedings.

Fish would take Dwek’s checks and deposit them with a religious charity he controlled, then give him back cash minus a 10 percent commission. Assistant U.S. Attorney Mark McCarren conceded it is unknown where the cash came from, evidence that many others were involved in a sophisticated scheme.

Pisano agreed.

“There is a lot of mystery that shrouds these transactions,” the judge said. The cash “comes from out of the sky and it shows up and it’s given miraculously back to Dwek.” Fish was able to ensure that cash was available “almost immediately,” Pisano went on. “This demonstrates to me that there was an organization involved here.”

Fish admitted laundering more than $900,000 in 2008 and 2009.

Another factor that weighed against Fish was his previous guilty plea in a bank fraud case in New York more than a decade ago. He received a sentence of home confinement but apparently didn’t change his ways, McCarren said.

“He figured out ways to make his criminal activity less detectable” by using untraceable cellphones, for instance, McCarren said. “This was a man who was very concerned about getting caught.”

More David Porter.

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