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CASES AND PRESS

JERSEY POL IN N.Y. PONZI BUST

By LAURA ITALIANO - November 8, 2007

A city council president from Bergen County was hauled in handcuffs before a Manhattan Supreme Court justice last night - as one of three New Jersey lawyers charged in a $40 million real-estate Ponzi scheme.

Joseph Mongelli, 43, of Elmwood Park, pleaded not guilty to grand larceny and was released on $100,000 bail into the arms of his wife, with whom he marked his 15th anniversary yesterday.

In addition to heading Elmwood Park's council, Mongelli is a prosecutor in two New Jersey municipal courts.

The father of four turned himself in at the Manhattan DA's office. Also charged were Peter Vogel and Joseph Greenblatt - both former law partners of Mongelli, who is now disbarred.

Prosecutors say the three swindled more than 100 victims, many from New York, by promising 12 percent interest or better if they invested in homes purportedly purchased by a company called Maywood Capital.

Maywood, which had moved from New Jersey to Manhattan, promised to buy, renovate, and flip homes for a profit, prosecutors said yesterday.

In fact, though, the company often didn't purchase the homes at all, instead using recent investments to pay off earlier investors in what amounted to nothing more than a Ponzi scheme, the DA said.

Maywood is said to have made $293,000 in the alleged scheme.

"This is an extremely strong case," prosecutor Andrew Seewald said,

Mongelli's lawyer, Eric Franz, said his client had "worked for Maywood - he did some real-estate closings for them and he was paid for the closings. He did not receive a single percentage of any of the underlying real-estate transactions that they're alleging were schemes."

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