Sunday, March 13, 2011

By Star-Ledger Staff

JERSEY CITY ? One of Hudson County?s most powerful operatives, a close and feared associate of Jersey City Mayor Jerramiah Healy, was secretly on the payroll of infamous FBI informant Solomon Dwek, according to a confidential government surveillance video.

Harold "Bud" Demellier ? a key Democratic strategist who ran Healy?s 2009 re-election campaign ? can be seen on the video, talking with Dwek about politics and making calls on his behalf in connection with several development deals. Those projects were later revealed to be part of a massive FBI undercover sting.

In this surveillance video excerpt, FBI informant Solomon Dwek can be seen talking with Harold 'Bud' Demellier about politics, money and making deals. Dwek can be seen in this video talking with Demellier about $20,000 that he gave him. Demellier is a key Democratic strategist who ran Jersey City Mayor Healy's 2009 re-election campaign. Dwek also speaks with Tom Fricchione, a former Jersey City councilman who was tied to Dwek in other videos but never charged. Fricchione died in Dec. 2009.

Demellier, in an interview, did not deny an association with Dwek and admitted Dwek paid him $20,000 in cash for consulting work. Demellier said he did nothing wrong.

Unlike others caught up in the investigation, he was never charged, arrested or even named in any of the criminal complaints that ensnared more than 44 mayors, legislators, Orthodox rabbis and others in the summer of 2009.

The surveillance video was discovered as part of the research for a new book on the federal investigation, "The Jersey Sting: A true story of corrupt pols, money laundering rabbis, black market kidneys, and the informant who brought it all down." It is to be released Tuesday by St. Martin?s Press.

The disclosures mark the first time that Demellier has been linked to the case, and the most vivid sign yet of just how close the FBI was moving toward the mayor of the state?s second-largest city.

Demellier, a political kingmaker whose connections helped
land him a $127,800-a-year job as director of the Hudson County Department of Roads and Public Property, said he met several times with Dwek ? a man he knew at the time as David Esenbach.

"This was someone I thought was involved in a syndicate that had money," he said from behind the desk in his seventh-floor corner office of the county administration building. It is the same office that can be seen in the surveillance video Dwek shot. Demellier said Dwek never gave him money for Healy?s campaign and he denied ever trying to sell influence. Asked if he mentioned his involvement with Dwek to Healy, Demellier replied, "I don?t remember."

Healy, through a spokeswoman, declined comment.

Former acting U.S. Attorney Ralph Marra, who was running the investigation when it became public, had nothing to say about Demellier. The current U.S. attorney, Paul Fishman, said he would not discuss any pieces of the Dwek case that have not been made public through official channels, including what ? if anything ? investigators were pursuing in connection with Healy.


Federal prosecutors never made it a secret that they were interested in Healy. Never accused of any wrongdoing in connection with the case, the colorful Jersey City mayor nevertheless played a starring role in other stark surveillance videos captured by Dwek. At a March 2009 sit-down at the Medical Center Luncheonette, Healy met with political consultant Jack Shaw, Jersey City Housing Authority commissioner Ed Cheatam, Deputy Mayor Leona Beldini and Dwek.

The FBI informant played the role of a corrupt developer in the three-year-long corruption and money-laundering probe.

At the meeting, Healy did not respond to any of Dwek?s attempts to draw him into the sting. At one point, he tells the mayor he wants his permit applications on the "top" of the pile.

Healy simply laughs.

"We like to smooth the path for people to invest in our city," was all the mayor said, referring Dwek to the city?s planning office.

In other surveillance recordings and transcripts released during Beldini?s trial, Shaw was also heard trying to set up meetings aimed at putting Dwek and Healy together.

Beldini was ultimately convicted in February 2010 of accepting $20,000 in illegal campaign contributions for Healy?s campaign. Shaw died just days after his arrest in the case.

Demellier?s introduction to Dwek came at the end of a chain of meetings with others tied to the sting operation, which the FBI called Operation Bid Rig III. According to records and transcripts, Maher Khalil, then-Jersey City?s assistant director of health and a former member of the zoning board who has already pleaded guilty in the case, put Dwek in touch with former Jersey City councilman Tom Fricchione. Then Fricchione introduced Esenbach to Demellier.

Fricchione died in December 2009. His name never surfaced in connection with the Dwek investigation, but he was a recurring character in the FBI?s surveillance recordings.

In those videos, Demellier and Dwek talk politics and poll numbers before turning their attention to how to get zoning approvals to build a luxury condo development in Jersey City. The project, located in an industrial section of the city atop a chromium waste site, was bogus and concocted by the FBI as part of the sting.

Demellier on the video tells Dwek he was moving ahead with getting the approvals in place to build the massive Garfield Avenue project. Demellier can be heard instructing him on which lawyer to hire: "I?ll call him and tell him to expect it. ? Actually I?m on his payroll for various things in other places."

As the discussion shifted to another proposed project in Bayonne, where Demellier had connections as well, the county official immediately took out his BlackBerry and punched in the number of Bayonne City Hall, leaving a message for the mayor?s chief of staff.

"A friend of mine, I understand, submitted some drawings ? when you get a chance give me a call, we can chat a little bit about it," he can be heard saying on the video.

NO PLANS

Demellier, when asked about the surveillance video and his meetings with Dwek, said he had an outside consulting company called DUB Inc. He had agreed to help the man he knew as Esenbach with development opportunities. "He never showed any knowledge of zoning laws," Demellier said. "He never had any building plans. I got irritated a little because he had no plans."

He did not believe the consulting business conflicted with his role as a county official. He said Dwek never gave him money for Healy?s campaign. He denied ever trying to sell influence.

At first, he said he not spoken with FBI agents about the matter. A few minutes later, he corrected himself and said he spoke to the FBI only once, when one of the agents connected to the case called after the takedown. But, he said, "they didn?t ask me anything."

Demellier said he is not cooperating with federal investigators.

"People that know me know that?s not something they should believe," he stated.

He still has the $20,000 in cash that he received from Dwek. Demellier said he has never been asked to give it back.

By Ted Sherman and Josh Margolin/For The Star-Ledger

http://www.nj.com/news/index.ssf/2011 ... ty_kingmaker_says_he.html