Prominent North Jersey developer Fred Daibes — who is linked with Sen. Bob Menendez’s bribery charges — withdrew his guilty plea in the bank fraud charges filed against him in 2018 a week after a judge rejected the agreement.
Daibes is one of five people indicted in an alleged corruption scheme involving Menendez and his wife, Nadine Arslanian Menendez, in a separate case. Daibes pleaded not guilty to the charges.
United States District Judge Wigenton posted a text order for Daibes last week saying that after reviewing the presentence report in the bank fraud case, the court rejected the plea agreement. The rejected agreement came after Daibes was charged in the Menendez indictment.
The indictment shed light on Menendez interference with Daibes bank fraud charges alleging Menendez nominated a U.S. attorney who he believed he could influence in Daibes favor.
Why did Daibes withdraw his guilty plea?
The rejected plea agreement comes from charges filed in 2018 against Daibes when he was indicted on multiple counts for alleged conspiracy to circumvent lending limits set by Mariner’s Bank, which he had founded in 2001.
In 2022, Daibes admitted to receiving more than $1 million in gross receipts from Mariner’s Bank and pleaded guilty to making false entries in a loan memorandum. His sentencing hearing was delayed four times since and had been scheduled for Oct. 26.
Daibes’ attorney Lawrence Lustberg sent a letter to United States District Judge Susan D. Wigenton stating Daibes withdraws his plea and requests the court to schedule a status conference to discuss future proceedings.
Lustberg filed the withdrawal paperwork on Friday and declined to comment further when reached on Monday.
After Daibes rejected his plea, attorney Vikas Khanna for the United States sent a letter to notify the court that the government had withdrawn the plea agreement and also requested a status conference.
“The Court is not required to adhere to the terms of the plea agreements, and the cases may be disposed of less favorably toward the Defendants than the plea agreements contemplated,” Wigenton wrote in a letter that rejected the plea agreement.
The original indictment
Daibes and Michael McManus, the chief financial officer of Daibes Enterprises, allegedly used others not named in the indictment to secure millions of dollars in loans — which were used for Daibes’ benefit — without the knowledge of the bank or the Federal Deposit Insurance Corp. The activity occurred from 2008 through 2013.
The plea agreement was also rejected for McManus.
Daibes pleaded guilty to a single count of the original 14-count indictment, which included a 2008 memo for a $1.8 million nominee loan that falsely stated the borrower and the source of repayment. The line of credit was actually for Daibes, who funded the repayment.
Daibes’ ties to Menendez
Last month, corruption and bribery charges were filed against Menendez by the U.S. Attorney for the Southern District of New York. The unsealed indictment stated Menendez accepted hundreds of thousands of dollars in bribes from three New Jersey businessmen, including Daibes, in exchange for helping them enrich themselves and trying to get them out of trouble.
The indictment said Menendez had recommended that President Joe Biden nominate someone as New Jersey’s U.S. attorney he believed could be influenced to disrupt the federal criminal prosecution of Daibes over the bank fraud charges.
Before Daibes pleaded guilty, Menendez allegedly pressed Philip Sellinger, before and after he became the U.S. attorney for New Jersey, to go light on Daibes.
In December 2020, Menendez met with Sellinger to consider whether he would support Sellinger’s nomination to the U.S. attorney post. At the meeting, Menendez criticized the prosecution of Daibes and asked Sellinger to “look into” the case if he was nominated, the indictment reads.
In early 2022, Menendez had short phone calls with the first assistant U.S. attorney. At the time, Daibes’ unnamed driver had called Nadine Menendez twice on Jan. 24. Later that day, Nadine Menendez texted Daibes: “Thank you. Christmas in January.”
The driver’s fingerprints were later found on an envelope containing thousands in cash at the Menendez home. Several days later, the senator Googled the phrase “kilo of gold price.”
In March, Nadine Menendez met with a jeweler and showed him two 1-kilogram gold bars that were worth more than $120,000, according to the indictment. Serial numbers showed that the gold bars had been owned by Daibes, the indictment reads.
The next month, Daibes pleaded guilty to a probationary sentence in the bank fraud case.
This article originally appeared on NorthJersey.com: Fred Daibes withdraws guilty plea in 2018 bank fraud case
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