Fred Daibes, the New Jersey actual property tycoon on the middle of a world scandal threatening the profession of Senator Robert Menendez, has discovered his manner out of a couple of robust spot over the course of his tumultuous life.
He spent his first 10 years in a Palestinian refugee camp earlier than emigrating to New Jersey, court docket data present. At 20, after his father died, he dropped out of faculty to assist 4 youthful siblings, a choice that paved the best way to a wildly profitable profession constructing luxurious housing in Edgewater, N.J. In 2013, he survived a vicious beating inside his penthouse condo there.
However in 2018, he confronted a problem that was far totally different. A 14-count federal indictment accusing him of scheming to defraud a financial institution he had based threatened to upend his actual property empire and carried the danger of a prolonged jail time period.
It was then, prosecutors say, that he turned to a longtime ally for assist: Senator Menendez.
What adopted would kind the idea for federal expenses that Mr. Daibes, Mr. Menendez and his spouse, Nadine, and two different businessmen at the moment are going through. All 5 have pleaded not responsible.
Mr. Daibes, 66, was accused of giving the Menendezes bribes in trade for the Democratic senator’s efforts to assist him within the financial institution fraud case by putting in a U.S. lawyer inclined to ease up on the prosecution. Envelopes full of money bearing Mr. Daibes’s fingerprints and 9 bars of gold bullion with serial numbers tracked to him have been seized throughout a search of Mr. Menendez’s residence, in accordance with federal prosecutors in Manhattan.
Nonetheless, the senator’s effort to meddle within the bank-fraud case failed, prosecutors stated.
“I don’t need him to be upset over it,” Mr. Daibes wrote in a textual content message to Ms. Menendez as his case proceeded towards trial. “This isn’t his fault he was wonderful in all he did he’s a tremendous buddy and as loyal as they arrive.”
Ultimately, there was no trial. Mr. Daibes pleaded responsible to a single rely of creating false entries in reference to a $1.8 million mortgage doc as a part of an settlement, permitted by the U.S. lawyer’s workplace in New Jersey, that required no jail time.
Final week, nonetheless, a choose rejected that plea settlement, scuttling the unique deal altogether and complicating an already sprawling net of allegations that poses new threats to Mr. Daibes’s actual property empire.
On Friday, his lawyer within the New Jersey federal case, Lawrence S. Lustberg, formally withdrew Mr. Daibes’s responsible plea.
Each instances — the accusations of financial institution fraud and bribery — have tainted Mr. Daibes’s legacy because the chief architect of Edgewater’s rebirth.
Forty years in the past, the borough of Edgewater was struggling. The slim ribbon of land adjoining to the Hudson River, going through Manhattan, was as soon as residence to factories the place Ford manufactured vehicles, Alcoa made toothpaste tubes and Quanta Assets produced roofing tar. However the corporations had shut down, leaving environmental contamination of their wake.
Within the Eighties, Mr. Daibes, a mason’s son, hopped on a wave of postindustrial redevelopment already happening downriver, in Hoboken and Jersey Metropolis. Whereas taxpayers financed a lot of Edgewater’s environmental cleanup, Daibes Enterprises constructed hundreds of residential items, plus workplace suites, retail complexes and a golf vary. Its working-class bars lengthy gone, Edgewater’s bustling enterprise district as we speak contains Entire Meals and Dealer Joe’s, a number of superb eating places and a seven-story day spa with a rooftop pool.
As Mr. Daibes’s high-rises went up, the inhabitants roughly tripled — to 14,600 — over three a long time.
Robert D’Angelo, the proprietor of Roberto’s II, a family-run restaurant in enterprise since 1962 in Edgewater, stated Mr. Daibes put the borough on the map but by no means forgot his humble roots.
After Hurricane Sandy, Mr. D’Angelo stated Mr. Daibes was one of many first individuals to reach on the restaurant as soon as the roads reopened. Mr. Daibes helped him clear up and put him in contact with electricians, plumbers and carpenters.
“With out him, it could have taken me months to reopen,” Mr. D’Angelo, 63, stated.
“He took himself up from the underside and he by no means forgot anybody on the best way up,” he added.
A neighborhood media fixture, Mr. Daibes was featured in a magazine spread about his traditional and unique automotive assortment, together with a purple 1957 Jaguar XK140, a silver 2005 Bentley Continental GT with a turbocharged W-12 engine and a pair of Mercedes-Benz SLR McLarens.
His excessive profile, although, got here at a value. Two days earlier than Thanksgiving, in 2013, 4 individuals broke into his penthouse on the St. Moritz, certainly one of his buildings, tied a bag over his head and beat him, breaking his ribs, dislocating a shoulder and bruising his face. They left with not less than $2 million in money, gold and jewellery. Once they have been arrested, one turned out to be a confidant of Mr. Daibes residing in the identical constructing. The 4 struck plea agreements to serve 12 to 18 years in jail.
Final month, prosecutors in Manhattan unsealed a 39-page indictment in opposition to Mr. Daibes, the Menendezes and the 2 different businessmen, Wael Hana and Jose Uribe.
It stated that Mr. Daibes offered monetary backing to Mr. Hana, an Egyptian-American businessman who was later awarded a profitable contract giving his firm, IS EG Halal, the only real rights to certify that merchandise imported to Egypt had been ready in accordance with Islamic regulation. IS EG Halal operates from a constructing in Edgewater owned by an organization run by Mr. Daibes, who additionally has workplaces there.
In flip, Mr. Menendez, as chairman of the Senate International Relations Committee, helped direct help and weapons to Egypt, prosecutors stated.
Mr. Daibes’s lawyer within the Manhattan felony case, Tim Donohue, stated his consumer’s monetary hyperlink to Mr. Hana was restricted to an “arms-length mortgage.”
“Mr. Daibes isn’t an proprietor or investor in that enterprise,” Mr. Donohue stated about IS EG Halal.
By then, Mr. Daibes was a significant fund-raiser for Mr. Menendez, a Democratic energy dealer who has represented the area since he was appointed to the Senate in 2006, prosecutors and federal election data present.
Related generosity had helped earn Mr. Daibes a job as kingmaker in Edgewater, on the expense of taxpayers, in accordance with a current state investigation.
Mr. Daibes offered Edgewater officers free or diminished rents in condo buildings he owned and awarded a flooring job to a councilman’s firm in trade for favorable remedy in enterprise offers, state investigators discovered.
“Daibes’s energy and affect inside Edgewater have been so robust he even held sway in native political selections and different municipal issues,” New Jersey’s Commission of Investigation found.
“Municipal officers who took official actions unsupportive of the developer confronted political {and professional} retribution,” investigators added. Mr. Daibes, by way of his lawyer, has rebutted the allegations and stated that the rental advantages have been items offered to longtime associates.
A minimum of one of many subpoenas issued, earlier than the three-count indictment was introduced final month in Manhattan, requested details about laws pending in New Jersey that might have derailed a significant high-rise residential venture Mr. Daibes was planning at 115 River Street in Edgewater.
The venture had misplaced its financing after getting slowed down in a delayed environmental cleanup, court docket data present. However late final yr, Mr. Daibes traveled to London and Qatar to fulfill with potential new lenders.
In January, he finalized a $45-million shared-ownership settlement for the Edgewater venture with an organization based by a member of Qatar’s royal household, Bergen County deed data present. It’s unclear how his new authorized challenges would possibly have an effect on that venture.
A choose has scheduled trial on the bribery-related expenses for Might 2024, in a courthouse in Decrease Manhattan, 10 miles from Edgewater.
