Wednesday The Rabbi Took The Stand

David Avigdor’s voice boomed from the witness box through the wood-paneled courtroom after a federal prosecutor asked him how he could have signed off on $1.5 million in mortgages for a single buyer in five weeks without asking any questions: ​“I’m not a prophet! I’m a human being! How am I supposed to know what people are doing behind my back?”

Avigdor’s testy testimony — sprinkled with a lineage journey back to the days of King David — came Wednesday on Day 11 of a federal conspiracy trial unfolding in U.S. District Court in Hartford, where cross-examination briefly turned into a shouting match.

The New Haven rabbi and attorney is one of five defendants who are fighting to clear their names of charges that they conspired with 10 others to defraud government and private lenders of millions of dollars in a scheme that further dragged down New Haven neighborhoods struggling with blight and foreclosure.

The government rested its case on Wednesday. Then Avigdor became the only defendant to elect to take the witness stand to personally proclaim his innocence. All his alleged co-conspirators have either pleaded guilty or chosen to avoid undergoing cross-examination.

His appearance in the box led to heated, combative exchanges with Assistant U.S. Attorney Eric Glover, who seeks to convince a jury that Avigdor knowingly acted as a settlement agent on at least 14 fraudulent mortgages and then wired ill-gotten gains to other conspirators by means of a phony construction company’s bank account.

Prosecutors allege that the conspirators in the scam used trumped-up appraisals to inflate the value of homes for sale, took out private and government-backed mortgages for the false value, paid ​“straw buyers” to purchase the homes for their real prices, pocketed the difference, and then abandoned the homes to foreclosure. Over several years of running this scam on homes in New Haven and surrounding towns, the perpetrators allegedly netted over $3.5 million.

Avigdor maintains that he was not one of those perpetrators. He testified Wednesday that he was simply doing what was asked of him as an attorney, and that he trusted the people with whom he was working. That includes, most notably, his office mate at 419 Whalley Ave., former Beaver Hills Alderman and State Rep. and disbarred attorney Morris Olmer, another defendant in the trial.

Avigdor told the jury he followed instructions from Olmer and his clients and received nothing more than a standard fee of $300 to $400 for his time. He presented himself as a law-abiding attorney who was simply taken advantage of by people he trusted.

He also offered jurors a brief summary of his credentials, going back to 1000 B.C.

King David

Avigdor began personally making his case just before lunch on Wednesday. He wore a black velvet yarmulke on his head and a turquoise tie under a navy suit that hung loosely as he walked across the dark blue carpet to the witness box.

It’s his favorite suit, his wife Susan explained. She said her husband has lost weight since suffering a stroke last May. She cried quietly as soon as her husband began to testify and read from a book of Hebrew psalms as he spoke.

Under questioning from his attorney, Howard Lawrence, Avigdor told the court that he was born in 1953, is married to Susan, and has four daughters and two sons. He said he’s the senior pulpit rabbi in New Haven.

“It means I’ve lasted longer than anyone else,” he said, smiling. He comes from an ​“unbroken line of rabbis” on his mother’s side going back over 25 generations, to the time of King David, he said.

“King David of David and Goliath,” said Lawrence, wearing a black shirt and silver tie under a navy suit.

“Yes.”

“He’s your ancestor.”

“Yes,” Avigdor said. ​“It is absolutely a fact.”

Susan, sitting in the gallery, later showed off a book written about David’s grandfather, Rabbi Dr. Yaakov Avigdor. Page 16 shows the unbroken ​“Golden Horowitz Chain” of rabbis going back to Shefatyah, the fifth son of King David.

“It is a very proud legacy but one that i find to be a tremendous burden and responsibility,” Avigdor said. ​“As a rabbi with such credentials, people look at me differently. …I’ve always lived my life in a very legal and kosher way.”

Avigdor said he follows ​“Jewish law” every single day, which entails adherence to ​“hundreds and hundreds of rules” governing what he eats to how he speaks.

“And at the top is the Ten Commandments?” Lawrence asked.

“Absolutely.”

“Thou shalt not steal?”

“That’s correct.”

Olmer’s Office

Avigdor told the jury that he worked for 20 years as a lawyer in the office of a local attorney who developed cancer in 2007. The practice was downsized and Avigdor found himself needing a a new place to work. One day, as he was visiting Young Israel synagogue of New Haven on Whalley Avenue, he happened to run into Olmer, whose office was next door at 419 Whalley.

“We had a conversation,” Avigdor said. ​“We agreed that he had an empty office and that I would share space in his office.”

Avigdor said that he and Olmer were never partners, that he had a lock on the room he used in Olmer’s suite. He said he was aware Olmer had recently voluntarily surrendered his license after running afoul of the bar association for a questionable real estate deal.

That matter is part of another case pending in state Superior Court. Attorneys agreed Wednesday morning not to bring the details of the case up before the jury.

Knowing that Olmer was having legal and professional difficulties, Avigdor asked around about Olmer, he said. He heard ​“glowing recommendations” from colleagues.

Avigdor settled into Olmer’s office in part because of Olmer’s established client base. ​“It could be very helpful to me to have a flow of clients that he could not service,” Avigdor said.

“Olmer would refer real estate matters to you,” Lawrence said.

“He asked me to be a settlement agent on closings,” Avigdor said. That meant, he told the jury, that he would ensure that money changing hands in real estate closings was distributed exactly as shown on the HUD‑1 settlement statement, a document that’s integral to mortgages backed by the federal Department of Housing and Urban Development (HUD). Avigdor was responsible for wiring money transferred in the deals, using his Interest on Lawyers Trust Account (IOLTA), a special account used by attorneys for holding client money.

Olmer paid Avigdor a fee of between $300 and $400 for being the settlement agent on each closing, Avigdor said. He did at least ten of these for Olmer, he said. He later said he instituted a new record-keeping system to track all money that came in and went out of the office in real estate transactions.

Everything was going fine, until he got a call from Ira Zimmerman at Precision Financial, a Rhode Island mortgage broker

Precision Pay-Off

The call came in July 2008. ​“There were two people on the phone. A Mr. Zimmerman and someone else. They were very upset,” Avigdor recalled.

Zimmerman, the president of the brokerage company, had just found out that a man name Mohammad Saleem was not living in the Milford house he had just purchased — with Avigdor’s help — from Precision, as he was required to do under the conditions of the loan.

Avigdor hung up the phone and went into the office of Olmer’s secretary, Peggy. He grabbed the file for the closing and called Saleem’s cell phone. ​“You have to move in; it’s your obligation,” Avigdor recalled telling him. ​“Either move in or they’re going to call the loan!”

Saleem and Olmer both assured Avigdor they would take care of it, Avigdor said.

Avigdor had a particular interest in the Milford house, at 61 Baxter Lane. His wife, a realtor, had earned a commission on the sale of the home to Saleem, who bought the house for $310,000.

Just a few days later, Olmer came to him with a solution, Avigdor said. Another buyer had been found, by the name of Ari Mountzerous. Olmer, acting with power of attorney for Saleem, signed the new HUD‑1. Avigdor was the settlement agent. The $310,000 sale went through. Avigdor wired Precision its money.

Lawrence asked Avigdor if he ever suspected Saleem had an ulterior motive for selling the house and paying off Precision so speedily.

“I was happy he was fulfilling his obligation to the bank,” Avigdor said. ​“I was making sure he was doing what was proper and appropriate under the circumstances.”

“Look at these folks,” Lawrence said, sweeping his arm toward the jury box. ​“Did you do it? … Did you know [the conspirators] were stealing money?”

“I never knew anything that was going on,” Avigdor said, turning to the jury. ​“I never took any money. I never would and I never have and I never will.”

“No Way To See A Pattern”

When Assistant U.S. Attorney Glover, a tall man in a yellow and red striped tie, began his cross-examination, tensions quickly boiled over.

“I ask the questions,” Glover interrupted Avigdor, just seconds into the dialogue.

“It’s just that this is not the whole story,” Avigdor exclaimed moments later, upset by a line of questioning.

“Have you sat here through this whole trial?” Glover asked forcefully, a short time later. First one side gets to ask questions, then the other, he said, his voice raised. ​“Now it’s my opportunity.”

“I’m not denying you the opportunity,” Avigdor said.

“Then just answer the questions,” Glover said.

Glover pulled up two HUD‑1 forms on the 18 computer monitors in the courtroom, for two homes in Meriden.

“That’s my signature on both of them,” Avigdor acknowledged.

Above the signature is language stating that all of the information on the form is true and accurate and that the funds involved in the transaction will be disbursed as stated on the form. Below the signature line is a warning that it is a crime to do otherwise.

“I see it,” Avigdor said.

The second of the homes, at 281 Crown St., was sold by a woman named Nadine Delucia. Days after the sale, Avigdor wired $45,000 from the sale to Ken Perkins, a man who has admitted to his role in the mortgage fraud ring and wore a wire to help federal investigators. But that payment was not indicated anywhere on the HUD‑1, Glover said.

“I sent it to who she [Delucia] asked me to,” Avigdor said.

“You never even met Nadine Delucia!” Glover shouted.

“Slow down!” Lawrence exclaimed from his seat. ​“He’s abusing the witness,” he protested to the judge.

“I was not at the closing when she signed the papers,” Avigdor said. He acknowledged that he never spoke to Delucia.

“You sent that money to Mr. Perkins’ bank account,” Glover said.

“I sent it where I was directed by the seller,” Avigdor said. ​“The seller gave me a written statement of where to wire it.”

Glover noted that multiple deals Avigdor worked on included wiring money to Sheda Telle, a phony construction company concocted by the conspirators to disburse proceeds from fraudulent deals.

“Every closing was different!” Avigdor protested. ​“There was no way to see a pattern. There was no way to know who Sheda Telle was or who Ken Perkins was!”

“Olmer told me everything,” he said, minutes later. ​“I followed his direction as well as written directions. … That’s what an attorney does.”

$1.5 Million In 5 Weeks

“Let’s talk about Mohammad Saleem,” Glover said. ​“You did five closings for Mohammad Saleem in five weeks. … There is over $1.5 million in loan proceeds in about five weeks in transactions for which Mohammed Saleem is the buyer.”

Glover detailed the thousands of dollars wired from Avigdor’s IOLTA to Sheda Telle construction from each of these transactions. ​“That’s over a quarter million dollars wired to Sheda Telle in a little over a month.”

“People come to law offices to wire money all the time,” Avgdor said. ​“I had no idea that Sheda Telle was a bogus corporation!”

Glover pressed Avigdor on his examination of occupancy affidavits.

“I did not get a chance to view documents in advance,” Avigdor said, raising his voice. Closings were done behind closed doors, then a file was put on his desk, he said.

“I went through the HUD[-1] … I did not review every document. There were 150 documents in each file,” Avigdor erupted, beginning to shout loudly. ​“You think I can read 150 documents in half an hour? … for 300 dollars?” People were hurrying him to finish the deals, he exclaimed.

Silence briefly filled the courtroom after Avigdor’s outburst.

“I’m so angry!” Avigdor said quietly, after stepping down from the stand moments later, during a short recess.

He sat with Lawerence and choked up as he told his lawyer how many people were praying at that moment. So did his wife. ​“I have people praying all over the world,” she said. ​“At the Wailing Wall, in Australia. … They’re praying to see an innocent man walk free.”

“He [Glover] tries to twist my words and lead me to slaughter,” Avigdor said.

“Your Trouble Went Away”

With Avigdor back on the stand, Glover questioned him about the deal with Saleem and Precision Financial and why, after closing four houses with Saleem, he was surprised to find that the buyer was not living in the house he just purchased.

“I never met the clients,” Avigdor said. They were all Olmer’s, he said. A file would land on his desk and he would be the settlement agent, he said. After the call from Zimmerman at Precision, Avigdor did no more closings for Saleem, he said.

But he continued to settle other closings for clients brought to him by Olmer, he said.

“I had no idea these people were straw buyers. I had no idea they were part of a fraud,” he said. ​“These people, they came into the office and wanted to do a closing. That’s what we do for a living. That’s what a law office does.”

Glover asked Avigdor why he didn’t think it suspicious that Olmer and Saleem arranged a sale of the house on Baxter Lane so soon after Precision complained Saleem wasn’t living there.

“I have no clue why it happened so quickly,” Avigdor said. ​“All I knew is I was happy.”

“Did you go to Olmer or anybody and say ​‘Holy cow! $1.5 million in five weeks! And Saleem’s not even living there! What is going on here?’ You didn’t do this,” Glover said.

Saleem and Olmer told him they’d work it out, Avigdor said. ​“I had no clue how it [the quick resale] came about.”

Precision Financial was paid off, ​“and then your trouble went away,” Glover said.

“It’s not a matter of my trouble,” Avigdor protested. ​“When you interviewed me [early in the investigation], I told you about this before you even mentioned it. … I saw something wrong and tried to make it right and then you twisted it make it look like I’m a part of this conspiracy.”

As the day drew to a close, Avigdor again told his attorney that he had ​“no inkling” that any criminal activity was going on.

“None whatsoever,” he said emphatically.

Previous coverage of this case:

• 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