Melissa Bailey Photo
When a mortgage scam mastermind was handing out “bags of money,” David Avigdor “did not receive any cash,” his lawyer claimed in a last-gasp attempt to defend the attorney and rabbi’s reputation. A prosecutor responded with a question: What about the thousands of dollars Avigdor’s wife received?
The exchange took place Monday on Day 14 of a riveting trial that’s wrapping up before Judge Alvin W. Thompson in U.S. District Court in Hartford. The case centers on an alleged 15-member mortgage fraud ring that milked rundown properties in New Haven and left government and private lenders holding the bag for millions of dollars, plunging struggling city neighborhoods further into blight in the process.
Avigdor (pictured outside the courthouse) and four co-defendants — as well as the federal attorneys prosecuting them — made their final arguments Monday before the jurors start deliberating Tuesday morning on charges of wire fraud, conspiracy and making false statements.
Taking his turn for a closing argument, Avigdor’s lawyer, Howard Lawrence, approached the jury box, where 12 jurors and three alternates sat with spiral notebooks, awaiting his final remarks. Lawrence took two court-issued two large computer monitors that had been obstructing his view and flipped them flat on their faces, “so we can see each other.”
Then he issued a message: “Follow the money.”
The argument that followed presented one of two main points raised by lawyers for attorney Avigdor, who’s New Haven’s longest-serving pulpit rabbi, and Morris Olmer, a former state legislator and New Haven alderman who shared office space with the rabbi.
First, they argued that contrary to other members of the scheme, they never got bags of cash for their participation in real estate deals.
Second, they claimed ignorance: How could they know the real estate deals were shady?
The government answered with a question of its own: How could they not know?
Avigdor, who’s 57, is listed as the closing attorney on 14 separate transactions allegedly arranged by the scheme’s mastermind, Syed Babar. While Babar handed out bundles of cash to straw buyers like Alicia Martineau and to prized appraiser and West Haven police commissioner Tom Gallagher, Avigdor never got a cut, Lawrence argued.
Attorney Lawrence with his daughter and office manager Marcella Lorenz.
“Everybody else got cash. Not David,” Lawrence argued. He said his client, who’s also a lawyer, was paid only his typical $300 to $400 fee per closing, no more.
Avigdor “told nothing, he was paid nothing, and he was used as a pawn for other people’s purposes,” Lawrence claimed.
He cited testimony by the government’s star witness, slum-photo doctor turned wire-wearer Kenneth Perkins, who said he didn’t think Avigdor was aware of the conspiracy.
When it came time for the government’s rebuttal, Assistant U.S. Attorney Eric Glover swung back. He said Perkins “didn’t know everything” that was going on in the scam.
For example: Perkins didn’t know Avigdor was involved in a deal at 61 Baxter Lane in Milford. That deal is central to understanding the rabbi’s role in the scheme, Glover argued.
The property belonged to the estate of D’Agostino. Avigdor’s wife, Susan, was the real estate agent trying to sell it. She was apparently having a tough time: On Jan. 7, 2008, she listed the property for $310,000. Seeing no takers, she knocked down the price on Feb. 5, 2008 to $270,000. The property sat four months unsold.
Then on June 26, just before the listing was due to expire, a buyer appeared and snatched up the property — not for the asking price, but for the full $310,000, according to Glover.
“Ms. Avigdor got her commission from that,” Glover said. A typical commission is 6 percent of the sale, which would be $18,600.
The sale landed Avigdor in hot water. On July 17, a lender named Ira Zimmerman called him and demanded his money back for the house. He had determined that contrary to what the loan application said, the buyer, Mohammad Saleem, didn’t live in the house and was not using it as a primary residence. Saleem had already closed on two other properties, plus a third on the very same day that Avigdor oversaw the closing of 61 Baxter Lane. Avigdor was the closing attorney on all these deals; he should have known Saleem was lying on the loan applications, Glover argued.
While the rabbi claimed he was ignorant of any illegal activity, Glover produced a page of notes Avigdor had scrawled at the time.
“I.Z. discovered that Mohammed purchased 2 or 3 deals + he is not living there,” Avigdor wrote. In cross-examination, he admitted it was his handwriting, but claimed that what looked like an “I.Z.” stood for “I2” not “Ira Zimmerman.”
Glover said it’s up to jurors whether they find his testimony credible.
After that scribbled note, Avigdor arranged for the full loan to be paid off. He did so with a wire transfer and a note: “this PYT settles all differences between the parties.” Glover said the note points out that Avigdor was aware that there was something fishy going on. And even if he was just discovering it in then, he continued to act as a settlement agent on three subsequent deals.
“Ask yourself if he knows what’s happening,” Glover argued. “What did he get out of this? He got business, and he needed business. His wife got a real estate commission. And he continued to have a law practice where he got clients.” (Olmer had surrendered his law license because he was facing disbarment. Avigdor got some of his clients by going into business with him.)
As to whether the rabbi was a “pawn,” Glover asked the jury to recall Avigdor’s forceful appearance on the stand.
“Did Mr. Avigdor strike you as someone who’d be ordered around? Did he strike you as a pawn?”
“Not Mr. Olmer”
Morris Olmer’s lawyer, Audrey Felsen, also tried to frame her 82-year-old client as an unknowing participant in the scheme.
She stood before the jury at 11:20 a.m., reading from notes typed on white paper.
“I’m not going to try to convince you that a scam didn’t occur, because it did,” Felsen said.
She also asked the jury to follow the money. The scam was all about getting money, she said — even the straw buyers testified as much.
“People got thousands of dollars,” she argued. “Not Mr. Olmer.” The government didn’t present any evidence of payments to Olmer, she said.
Olmer.
“The only thing you were presented with was a portion of [wiretapped] conversation,” where Babar is talking about giving Olmer some money for a proposed deal at 221 Starr St. The deal never went through.
Olmer was never involved in filling out any falsified documents, Felsen said. To prove this, she pointed a finger at Olmer’s former office mate.
“The one person who said Morris Olmer was involved in preparing documents was David Avigdor,” she said, “the one person who needs you to believe that he didn’t do it.”
Assistant U.S. Attorney Susan Wines said both officemates share culpability.
They were “a good match,” she argued: One had clients but no law license. The other had a law license but no clients. Together they “ran a mortgage fraud mill” with 14 closings in less than 18 months.
Wines played a recorded conversation in which Olmer advises Perkins to walk away from a lender who has sniffed out the fishy scheme.
In a final rebuttal, Glover didn’t have time to repeat the arguments on Olmer’s guilt.
“There’s an abundance of evidence against him,” Glover said. He cited testimony from straw buyer Alicia Martineau, who said Olmer guided her through signing papers to “buy” 221 Lloyd St., then never gave her the keys. Olmer arranged to collect rent on the house after Martineau bought it, Glover said.
“It was all a fraud, and he knew it. You know he knew it.”
Melissa Bailey File Photo
The prosecution lobbed a similar argument against New Haven poverty landlord Marshall Asmar (pictured), who also tried to argue that he was unaware of any conspiracy or scheme. Asmar made $263,000 by selling five houses to Babar’s associates. In one case, at 243 Starr St., he continued to collect rent even after he had “sold’ the home to a young straw buyer named Wilson Nicholas.
Asmar’s lawyer, Frank Riccio, Jr., argued that Asmar didn’t agree to be part of a conspiracy — he simply profited by selling his assets to willing buyers.
Wines said 243 Starr St. disproves that point.
“Who in the world rents out a house he no longer owns? No one, unless you’re involved in a fraud, where sales are not sales, and your buyers are not buyers. You don’t do that unless you know that the deal is a fraud.”
The government got the last word of the day, as closing arguments wrapped up at 4:40 p.m., leaving the five defendants’ fate in the hands of the jury.
Defendant Rab Nawaz, Babar’s uncle, drove away from court in his company van.
Previous coverage of this case:
• Claire: The Rabbi Is Kosher
• Wednesday The Rabbi Took The Stand
• 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