NJ Banker Accused of Bribing Menendez to Sway Loan Scheme Case
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(Bloomberg) -- New corruption charges against US Senator Robert Menendez highlight his ties to an indicted New Jersey banker accused of passing gold bars and cash to the lawmaker to sway the outcome of the businessman’s loan scheme case.
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Menendez, a New Jersey Democrat, used his power and influence to try to protect Fred Daibes, the former chief executive of Mariner’s Bank Inc. and an influential developer in Edgewater on the Hudson River, according to an indictment unsealed Friday. Menendez, his wife, and Daibes, who were indicted along with two others, deny wrongdoing.
Daibes, 66, had already been indicted by US prosecutors in 2018 and accused of obtaining millions of dollars in loans from the bank under false pretenses. Prosecutors say Daibes paid the senator to help pressure government officials to “disrupt” that case in a classic tale of power politics in New Jersey — a state with a storied history of corruption.
“Fortunately, the public officials that Menendez sought to influence did not bow to the pressure,” Damian Williams, the US Attorney in the Southern District of New York, said in a news conference. “That’s a good thing.”
Menendez sought to aid Daibes by trying to influence who ran the US attorney’s office in New Jersey and how they treated the banker, prosecutors said.
The election of President Joe Biden in November 2020 was expected to lead to appointments of new US attorneys in states across the country. A month later, Menendez met with a lawyer who wasn’t named in the indictment but matches the description of Philip Sellinger, the current US attorney in New Jersey.
At that meeting, Menendez criticized the Daibes prosecution and said he hoped Sellinger would look into the case if he became US attorney, prosecutors said. Sellinger told Menendez he would have to recuse himself from the case because he’d done work for Daibes.
Read More: New Jersey Governor Calls on Menendez to Resign Over Indictment
After that meeting, Menendez supported another lawyer seen as sympathetic to Daibes, but her candidacy died. An adviser then told the senator that, based on a conversation with Sellinger, he believed Sellinger wouldn’t have to recuse himself from the Daibes prosecution. Menendez recommended Sellinger, who got the job and began in December 2021. But the Justice Department recused him anyway from the Daibes matter.
In January 2022, Menendez called Sellinger and asked for the identity of the assistant US attorney in the office who was overseeing the Daibes case. Three days later, Menendez’s wife, Nadine, texted Daibes’ driver and wrote: “Thank you. Christmas in January.”
Two hours later, Menendez called the assistant US attorney for 15 seconds, the US says. Five days later, Menendez did a Google search for “kilo of gold price.”
Cash Seized
The driver’s fingerprints were later found on an envelope containing thousands of dollars in cash when agents seized $486,461 from Menendez’s house in New Jersey, two one-kilogram gold bars and 11 one-ounce gold bars, according to the indictment. The cash was stuffed in envelopes and hidden in clothes, closets and a safe, the US says.
Ten of the cash envelopes bore Daibes’ fingerprints or DNA, and one envelope had the senator’s fingerprints, according to the indictment. Agents also said they seized $79,760 from his wife’s safe deposit box.
A day after Nadine Menendez met Daibes for lunch in March 2020, she gave a jeweler two one-kilogram gold bars to sell, when the spot market price was more than $60,000 per kilo. Agents later found photos on her phone, taken that day, of two bars. The serial numbers matched gold bars that Daibes had previously possessed, the US says.
A spokesperson for Sellinger’s office said he was recused from the Daibes case and “all activity by the office related to that matter was handled appropriately according to the principles of federal prosecution.”
The indictment Friday wasn’t the first for Menendez. He was charged with corruption in 2015, but a jury couldn’t reach a verdict in 2017 and the judge declared a mistrial. Prosecutors dropped the case in 2018.
In April 2022, Daibes pleaded guilty under a plea deal to reduced charges in the bank loan case that call for a probationary sentence. He hasn’t been sentenced.
Daibes has been a prominent real estate developer in New Jersey, and he continued after his guilty plea. Among his projects was a commercial and residential project on a polluted site in Edgewater with some Chinese investors.
But when those investors pulled out after five years, a judge in his criminal case gave Daibes permission to travel to London and Qatar to seek new backers, court records show. This year, the project drew a $45 million investment from Heritage Advisors, a London-based firm led by a member of the Qatari royal family, the Wall Street Journal reported, citing public records.
Read More: Senator Menendez Charged With Taking Bribes of Gold Bars, Cash
The case is US v. Menendez, 23-cr-490, US District Court, Southern District of New York (Manhattan).
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