July 24 (Bloomberg) -- The mayors of Hoboken, Ridgefield and Secaucus, New Jersey, and five rabbis were among 44 people charged by the U.S. with public corruption and money laundering.

Hoboken Mayor Peter Cammarano, 32, Secaucus Mayor Dennis Elwell, 64, and Ridgefield Mayor Anthony Suarez, 42, all Democrats; Jersey City Council President Mariano Vega Jr., 59; State Assemblyman Daniel Van Pelt, 44, a Republican from Ocean Township; and Assemblyman L. Harvey Smith, a Jersey City Democrat, were charged yesterday in an FBI complaint. All except Smith appeared in U.S. court in Newark, New Jersey.

Gannett New Jersey. Left to Right: Peter J. Cammarano III, Daniel Van Pelt, Mayor Dennis Elwell, L. Harvey Smith

The corruption probe, based in Hudson County, netted many public officials accused of pledging assistance for bribes. A cooperating witness in that probe also infiltrated a “pre- existing money laundering network” that moved “at least tens of millions of dollars through charitable, nonprofit entities controlled by rabbis in New York and New Jersey,” according to a release by acting U.S. Attorney Ralph Marra.

“The fact that we arrested a number of rabbis this morning does not make this a religiously motivated investigation,” Weysan Dun, special agent in charge of the Federal Bureau of Investigation’s office in Newark, said at a news conference. “It is not a politically motivated investigation. It is about crime, corruption, arrogance and a shocking betrayal of public trust.”

Cooperating Witness

The roundup of suspects is one of the largest ever in New Jersey, where more than 100 public officials have been convicted of corruption in the past few years. The cooperating witness laundered $3 million through the rabbis and also made bribe payments to public officials, prosecutors said. Investigators made hundreds of hours of audio and video recordings of illicit transactions, according to prosecutors.

The cooperating witness is Solomon Dwek, a real estate developer in Monmouth County, New Jersey, who was charged on May 11, 2006, with scheming to defraud PNC Bank out of $50 million, according to three people familiar with the matter. Dwek is a rabbi’s son who was vice president of the Deal Yeshiva School in West Long Branch, New Jersey.

Cammarano, Hoboken’s youngest mayor, was sworn in July 1. Former state Assemblyman Louis Manzo, 54, a Democrat from Jersey City, and Leona Beldini, a deputy mayor of Jersey City, also were charged. Cammarano attorney Joseph Hayden didn’t immediately return a call seeking comment. Suarez lawyer Henry Klingeman said his client was innocent and wouldn’t resign.

Five Rabbis

The rabbis are Saul Kassin, 87, chief rabbi of Sharee Zion, a synagogue in Brooklyn, New York; Eliahu Ben Haim, 58, the principal rabbi of Congregation Ohel Yaacob in Deal, New Jersey; Edmond Nahum, 56, of Deal Synagogue in Deal; Mordchai Fish, 56, of Congregation Sheves Achim in Brooklyn; and Lavel Schwartz, 57, Fish’s brother.

David Bergeland / AP An FBI agent arrives with an unidentified suspect in a major corruption and international money laundering conspiracy probe Thursday morning, July 23, 2009, at the FBI's Newark, N.J. office.

The rabbis were charged with laundering money that often was sent to Israel. They are members of the Syrian Jewish or Hasidic Jewish communities, Marra said at the news conference. Authorities issued a warrant for Schwartz’s arrest. The other four rabbis were arrested yesterday and appeared in court.

“This case uncovered a web of corruption that spanned the state,” Dun said. “All of the individuals were connected through their illicit activities with the undercover witness.”

Kassin is accused of laundering more than $200,000 through Dwek from June 2007 through December 2008 by accepting “dirty checks” from him and exchanging them for “clean” checks, according to prosecutors.

‘Asserts His Innocence’

“The rabbi asserts his innocence,” said Kassin attorney Robert Stahl after U.S. Magistrate Judge Mark Falk imposed a $200,000 bail bond. “It’s a shame that he’s caught up in some misunderstanding. Despite his difficult circumstances, he remains confident that the system of justice will prevail.”

FBI officials bring one of the suspects arrested Thursday morning in a money laundering and corruption probe into the FBI's Barry Lee Bush Building Claremont Tower in Newark. Michael Sypniewski/Gannett New Jersey

Falk imposed a $1.5 million bail bond and electronic monitoring on Ben Haim. His attorney, Michael O’Donnell, declined comment. Falk set a $700,000 bail bond on Nahum.

“He had no involvement in any scheme as alleged and certainly looks forward to the opportunity to clear his name,” Nahum attorney Justin Walder said. “There’s no profit, no involvement in any international scheme.”

FBI officials bring suspects arrested this morning in a money laundering and corruption probe into the FBI's Barry Lee Bush Building Claremont Tower in Newark.

Nahum was implicated by “a person who obviously has his own problems and tried to limit his exposure” to criminal charges, Walder said.

Fish, Schwartz and two other defendants used a charitable, tax-exempt organization called BCG, which was associated with Fish’s synagogue, to launder money by using money transfers, according to the FBI.

‘Vindication’

“We are confident that the transfers referred to in the complaint will be explained to a jury in a manner that will result in Mr. Fish’s vindication,” said Michael Bachner, his attorney. He said Dwek “used his closeness and the sterling reputation of his family to manipulate individuals who believed that he would never be involved in illegal conduct.”

Exterior of the Deal Yeshiva Boys Division on Logan Road in Ocean Township. Mary Frank/Gannett New Jersey

Levy-Izhak Rosenbaum, 58, of Brooklyn, was accused of conspiring with others to acquire and trade human organs for use in transplantation. Rosenbaum, who was “purportedly” involved in real estate, was approached by a cooperating witness and an undercover FBI agent about buying a human kidney from a human organ broker, according to the complaint.

Rosenbaum said it would cost $150,000, with half payable up front, according to the complaint. Rosenbaum said some of the money would go to the donor and some to doctors in Israel, according to the complaint.

‘Illegal to Sell’

“One of the reasons it’s so expensive is because you have to shmear (meaning pay various individuals for their assistance) all the time,” according to the complaint. “It’s illegal to buy. It’s illegal to sell.”

Attorneys for Rosenbaum and the other suspects either couldn’t be identified or couldn’t be reached for comment.

Prosecutors charged the men in a series of criminal complaints detailing the allegations. Ben Haim was accused of laundering $1.5 million through the undercover witness, who said he “was engaged in illegal businesses and schemes including bank fraud, trafficking in counterfeit goods and concealing assets and monies in connection with bankruptcy proceedings,” according to an FBI criminal complaint.

Before his 2006 arrest, Dwek deposited two $25 million checks from another account of his, which had a zero balance, prosecutors alleged. Dwek then wired $22.8 million out of PNC, falsely assuring bank officials that he would forward funds to cover the overdraft, according to prosecutors.

$10 Million Bond

Dwek posted a $10 million bond, secured by $3 million in equity in the homes of his mother-in-law and sister-in-law. Dwek was never indicted, instead receiving 17 extensions from a judge to continue the period in which his case had to be presented to a federal grand jury.

Michael Himmel and Christopher Porrino, lawyers for Dwek, didn’t return calls or e-mails requesting comment.

More than 300 agents of the FBI and the Internal Revenue Service arrested the suspects and executed search warrants this morning, according to Dun.

Agents arrested 37 suspects yesterday, two surrendered, and three, including Smith, are expected to surrender tomorrow. Authorities issued arrest warrants for two other suspects.

Agents also searched the house of Joseph Doria, a former Democratic assemblyman and the commissioner of the state Department of Community Affairs. He hasn’t been charged. They also searched the offices of the president of St. Peter’s College, a school in Jersey City, as well as a synagogue in Deal, Dun said.

“Any corruption is unacceptable -- anywhere, anytime, by anybody,” New Jersey Governor Jon Corzine, a Democrat seeking re-election against Republican Christopher Christie, the former U.S. attorney in New Jersey, said in a statement.

‘Cannot Be Tolerated’

“The scale of corruption we’re seeing as this unfolds is simply outrageous and cannot be tolerated,” Corzine said.

Doria resigned yesterday at Corzine’s request, the governor’s spokesman said.

The arrests yesterday emerged from an investigation that spans a decade and has led to two earlier roundups.

“New Jersey’s corruption problem is one of the worst, if not the worst, in the country,” FBI supervising agent Ed Kahrer said. “Corruption is a cancer that is destroying the core values of this state and this great nation.”

To contact the reporter on this story: David Voreacos in Newark, New Jersey, at dvoreacos@bloomberg.net.