Lakewood man convicted in $200M Ponzi scheme gets nowhere with appeals
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on August 14, 2016 at 9:32 AM, updated August 14, 2016 at 9:33 AM
The Lakewood man who ran a $200 million Ponzi investment scheme that bilked members of the town’s Orthodox community has struck out in his attempt to overturn his convictions.
Eliyahu Weinstein was sentenced to 22 years in prison in early 2014 after admitting his role in what authorities said was one of the largest cases of investment fraud they’d encountered.
Just months later, he pleaded guilty to charges he tricked investors into thinking he had an inside track on the Facebook initial public offering.
“Shamelessly, he even used the money he stole to pay the legal fees he accumulated from the previous scam,” said U.S. Attorney Paul Fishman at the time. The judge tacked another two years onto his sentence for that crime.
Weinstein appealed both cases, seeking to withdraw his first plea and toss out the second set of charges.
In that appeal, he claimed the judge was tainted for the second case because he oversaw the plea deal in the first case. Weinstein also claimed his lawyer had a conflict of interest because he had advised investors so was also at risk of prosecution, and that the Facebook case amounted to Double Jeopardy.
A three-judge panel of the U.S. Court of Appeals Third Circuit rebuffed those claims in a ruling issued Friday.
U.S District Judge Joel A. Pisano’s participation in the first go-around of plea negotiations was extremely limited, and any claims to the contrary were “unsubstantiated hearsay,” the panel wrote.
As to Weinstein’s attorney, the panel found that any interactions the lawyer had with investment customers was based on his belief the money would be properly invested, not pocketed by Weinstein. Therefore, the lawyer would not have faced prosecution and was able to represent him in the case, the panel found.
The panel also made quick work of rejecting Weinstein’s assertion that prosecutors had split the overall case into two cases just to tack on more prison time.