North Jersey House Flipping Operator Cops Plea To Federal Conspiracy Charge

In Newark, New Jersey, the Herald News reports:

• A Bergen County real estate magnate who for years exploited unsuspecting Paterson homebuyers while bribing low-level city employees, pleaded guilty Wednesday to conspiracy to commit money laundering. Michael Eliasof, of Mahwah, agreed to a plea deal with federal prosecutors in U.S. District Court for overseeing a wide-ranging, house-flipping scheme between 2002 and 2005 that undermined an already shaky Paterson housing market. Eliasof, who at one time was a major operator in Paterson's Section 8 program, was charged with taking between $1 million and $2.5 million in illegal proceeds from the sale of overvalued properties to buyers not qualified to purchase them.

• The circle of professionals Eliasof worked with included Garfield Municipal Judge William C. Colacino Jr., who was the closing attorney for dozens of deals Eliasof lined up with inexperienced buyers. Colacino was not in court Wednesday and has not been indicted. He declined to comment Wednesday.

• Eliasof and 10 co-conspirators, including mortgage brokers, loan officers and appraisers, artificially inflated the values of properties throughout Paterson. They then falsified loan applications and income levels for those buyers whom Eliasof lured in with "no money-down" deals, according to the federal charges.

For more, see Magnate guilty in housing scheme.

See also:

• Corruption trial kicks off (Herald News - 12-5-07),
• Agent 'made us poorer' (Herald News - 11-1-07),
• Property scam retold to court (Architect of scheme admits money launder) (The Star Ledger - 11-15-07).

Go here for other posts on this ongoing investigation.