Eliyahu Weinstein, 41, a Lakewood man sentenced to 22 years in prison in 2014 for a Ponzi scheme that defrauded members of the Jewish Orthodox community of an estimated $200 million, on Friday lost his appeal to withdraw his guilty plea.
The new Weinstein plea argued that the federal judge who presided over his case, in which Weinstein admitted defrauding fellow Jewish investors on a Facebook initial public offering, was biased against the defendant because he was also involved in a case in which Weinstein pleaded guilty to a real estate scheme. Weinstein also accused his own lawyer in the 2014 Facebook IPO case of a conflict of interest because he had advised some of Weinstein’s investors, and feared his own prosecution. Weinstein’s new plea also argued that the Facebook case constituted double jeopardy.
On Friday, a three-judge panel with the 3rd Circuit Court of Appeals rejected Weinstein’s plea, finding that judge’s participation in the real estate scheme was too limited to suggest a bias and that Weinstein’s plea was based on “unsubstantiated hearsay.” The panel also absolved Weinstein’s original attorney of the accusation of conflict of interest, because when that lawyer was counseling clients on the IPO investment his assumption was that their money would be invested, not end up in Weinstein’s pocket. Which meant that the attorney had nothing to worry about and could represent Weinstein without fear for his own prosecution.
According to court documents, in February 2012 Weinstein and two co-conspirators offered two investors a chance to purchase large blocks of Facebook shares before the initial IPO in May 2012. Between February and March of 2012 the two “Facebook victims” wired millions of dollars to an account set up by Weinstein and a co-conspirator. That’s the last time they saw their money. Around the same time, Weinstein and his two co-conspirators talked the same investors into buying the Belle Glade Gardens apartment complex in Florida. The investors wired $2.83 million, of which Weinstein sent $1.8 million back to his victims as “return” on their Facebook investment. In July 2012, Weinstein scammed a different group of investors over purchasing seven condominiums in Florida at a discounted price of $3 million, and pocketed the money.