Jul 10
3
gambling boats florida
THE COMPLETE STORY OF THE RIVERBOAT BROTHEL: Dwek's company owned a floating casino 1,100 miles south on a boat called the Excalibur. The casino took wagers on roulette, slot machines and blackjack. It was all legal — whenever the 116-foot boat steamed nine miles into international waters from its Florida Gulf Coast port. Dwek's company had agreed to pay $2.5 million for the boat, but the gambling venture foundered. After 11 months, in 1999, the company defaulted on its loan. Dwek's bankrupt company then sold the vessel to an operator who transformed it into a floating strip club. The price for a stateroom on the ship? $300 an hour. Today, Dwek owes $1.1 million to the boat's builder. The failed gambling venture seems incongruous for a man once seen by his Sephardic Jewish community as a respected investor. Dwek also was vice president of the Deal Yeshiva, which operates Jewish schools in West Long Branch and Ocean Township. The floating casino is just one in a series of deals that many say was more than bad luck on Dwek's part. In court papers, former business associates — even an uncle — say the 33-year-old Ocean Township resident perpetrated frauds on them. "The guy's slick, I tell you," said Winston Knauss, 64, of Miami Beach, who built the boat as a dinner cruiser and sold it to Dwek in 1998. "I've been trying to collect the money ever since I sold the boat to him." Knauss won a $1.1 million federal court judgment against Dwek in March. More than three months after Dwek was arrested by the FBI on charges of defrauding PNC Bank with a worthless $25.2 million check he wrote out and deposited on April 24, five dozen investors and contractors claim Dwek owes them $156.5 million. Twenty banks claim Dwek owes them $181.9 million. A state Superior Court judge is overseeing the sale of Dwek's empire, in excess of 350 properties, to pay the $338 million creditors say they are owed. Michael B. Himmel, Dwek's criminal defense attorney, said the problem with the check is a business dispute, not a crime. There have been no court hearings on the merits of the claims by investors and contractors. But in Superior Court, investors claimed Dwek convinced them to provide tens of millions of dollars for phony projects. One investor, for example, said Dwek spent the money on his own "pursuits, purposes and use." Two investors, including an uncle, Joseph Dwek, claim they are owed $23 million just from one deal. They say Solomon Dwek took their money to buy the exclusive 18-hole Deal Golf & Country Club, but club members didn't want to sell. Joseph Dwek and another investor, Isaac Franco, claim they gave Dwek $45 million to buy and resell dozens of properties to Meridian Health System, the owner of Jersey Shore University Medical Center in Neptune, Ocean Medical Center in Brick and Riverview Medical Center in Red Bank. But Meridian closed only two deals with Dwek, in which it sold him two properties in 2000 and 2003, according to Meridian President John K. Lloyd. "Dwek . . . used Meridian Health's name and reputation" to advance his "troubled" deals, Lloyd said. Unkept promises "It is hurtful to our name, our people, our community, our religion," said Isaac Sultan, 65, of Ocean Township, a member of the Sephardic Jewish community in which Dwek lives. "Nobody is gaining or benefiting from this poor publicity. But, unfortunately, the federal courthouse is there. The FBI is there. No one can wish it away. The deed is done, the die is cast, and it will take its course." Sultan was not an investor with Dwek. But even as Dwek's empire was falling, he didn't stop making promises to people whose money he wouldn't give back, according to court claims. Take 54-year-old Jack R. Hakim of Ocean Township. According to court documents, by late April, Dwek was overdue to repay Hakim his $1.1 million personal loan. Hakim also had given Dwek a $2.6 million investment in September, but Dwek was late in buying a Neptune property with that money. Hakim began sending Dwek increasingly desperate e-mails. "Please, please, please take care of the 1st deal today and not on Thursday as you stated yesterday. I really need to have it today," Hakim e-mailed Dwek on Tuesday, May 2. But even after a Superior Court judge froze Dwek's assets on May 3, Dwek continued to make promises. Dwek's verbatim response to Hakim: "I am selling today. they will fund once the court releases my funds that will take a few days. Don't worry you will get pd in full. Thanks for all." Hakim said he's never seen a penny of his money. In court papers, Dwek denied the fraud claims by PNC and Hakim. In state Superior Court, other investors say they have been burned by Dwek. The investors include: The uncle, Joseph Dwek, 54, of Brooklyn, who said he gave his nephew $60.2 million since 2003 to buy investment properties. The elder Dwek said he later learned none of the properties was placed in his name. After PNC Bank said Solomon Dwek bounced the $25.2 million check, he agreed to transfer 129 properties to his uncle to "ameliorate the fraud Solomon had perpetrated on me," Joseph Dwek said in court papers. However, Solomon Dwek put 20 of those properties in his wife's name, the uncle's lawyer said. Isaac S. Franco of Brooklyn said Dwek "stole" $28 million from him by using "phony" real estate contracts, according to court documents. Some of the property didn't even exist, Franco said. But in this case, Dwek did repay a loan he and Franco had taken out with HSBC Bank. According to the FBI and court information, Dwek used $20 million of the phony deposit into PNC Bank to pay off a loan he and Franco received from HSBC Bank. Real estate developer Charles Ishay of Brooklyn claimed Dwek took $5 million to help buy the Deal Golf & Country Club. But Dwek knew the club was no longer for sale when he took the money, Ishay claims. A group of Jersey Shore University Medical Center doctors wired $500,000 to Dwek in December to buy a Neptune property to build a medical office. Dwek said, "Guys, we're running out of time, let's get this deal going," said Steven D. Scherzer, an Atlantic City lawyer who represents the doctors in their claims against Dwek. That was the last they saw of their money, they claim. Victor S. Franco, 54, of Manhattan said he gave Dwek $1.5 million in September, in exchange for a half interest in a quick buy-and-sell contract on a Neptune commercial building. But Dwek lied about the deal and misspent the money, Franco said in court documents. Dwek has not responded in court to the claims of Joseph Dwek, Isaac Franco, Victor Franco, Charles Ishay or the doctors. But Dwek, for years, has fought the builder of his former gambling boat in court.
Until his May 11 arrest by the FBI on bank fraud charges, Dwek, 33, was a high-paid administrator of the religious school that he and his parents operated. Some in the Sephardic community said Dwek is a kindhearted man who inexplicably ran afoul of the law.
Florida Casino Boats Looking at Tough Times: Could Maritime Safety be Compromised?
Florida's gambling ships which were doing brisk business just a couple of years ago, are facing dark times. The recession has cut down people's spending power, and new rules now allow land-based casinos to offer the same games that were available only on gambling boats.
Since Governor Charles Crist allowed land based casinos to offer black jack, baccarat and other games, there has been a reverse flood of patrons from the floating casinos to the land-based ones. The gambling boats have even more concerns in store. Port Canaveral officials have been indicated that in future, these vessels will have to be docked at the Jetty Park. Port officials want to free up space at the Port for additional development. Already two of the gambling ships that had to move to the Jetty Park have shut down operations.
As maritime lawyers, we know the kind of impact the economic downturn has had on the maritime industry. Shipping companies have sailed into troubled financial waters, and cutbacks have been seen in several sectors. We are concerned about how these financial problems will impact the workers on these boats. With no news yet about when the industry will recover, it's highly likely that workers' safety and health will be compromised, as companies scramble to tighten budgets.
Does a Casino Boat Qualify as a Jones Act Vessel?
Casino boats may qualify as Jones Act vessels if they actually move on navigable waters, and are not permanently moored to a dock. Workers on these boats may also qualify as Jones Act seamen, if they meet three basic criteria - they must be assigned to a vessel, the vessel must be in navigation, and the worker must contribute significantly to the mission of the vessel.
In contrast, casino boats that are permanently moored to a dock and are connected to land-based utilities, and where owners and operators don't plan to put them to sail any time soon, may not qualify as Jones Act vessels. One of the primary conditions of the Jones Act is that the vessel that the seamen are assigned to must be in navigation. There has been some debate what the term "navigation" means, but several judicial decisions have gone against workers who were on moored casino boats. Floating casino boats however, would be a different story.
The maritime attorneys at Schechter McElwee Shaffer and Harris represent injured workers on casino boats, freighters, tankers, jack up and semi submersible rigs, cruise liners, and other maritime employees who may qualify as Jones Act seamen. Please contact us at info@smslegal.com with any questions about maritime law, offshore injuries or status as a seaman.
