ELIZABETH – Sen. Robert Menendez (D-NJ) urged federal regulators to approve an acquisition to save a struggling Elizabeth bank whose officers included contributors to his campaigns.
In a letter to Federal Reserve Chairman Ben Bernanke obtained by the Wall Street Journal, Menendez tried to persuade the agency to approve the sale of First BankAmericano to JJR Bank Holding Co. of Brick on July 21, 2009. The letter did not disclose Menendez’s relationship with the bank officers.
“I urge you to support the proposed acquisition of First BankAmericano by JJR Bank Holding Company in order to avoid an action by the FDIC,” Menendez wrote to Bernanke. “Putting First BankAmericano into receivership would send yet another negative message to consumers and investors and further impact our fragile economy.”
The Federal Reserve did not act on the request and the bank failed on July 31, 2009, costing the FDIC $15 million.
Campaign records indicate that eight of 15 directors, including the bank’s chairman and vice-chairman, have been contributors to Menendez or his political action committee:
- Francisco Dominguez, 1996-97, 2002: $8,000
- Joseph M. Gillis, 1999-2006, $10,000
- Joseph A. Ginarte, 1993-2007, $19,630
- Arthur S. Guida, 1999, $1,000
- State Sen. Raymond J. Lesniak, 1993-2005, $8,000
- Wilson Londono, 1996, $250
- Roberto A. Madan, 1992-98, $800
- Remberto Perez, 1995-2005, $10,600
In addition to his personal contributions, Lesniak also hosted a fundraiser for Menendez in September 2006. Four hundred people attended at $1,000 a head for a place in a tent outside his house in Elizabeth; $10,000 a head for the 50 people who mingled with guest-of-honor former President Bill Clinton inside Lesniak’s home. Jon Corzine, then New Jersey governor, was also there.
Menendez said that he regretted the insistent wording of the letter, but stood by his decision to intercede on behalf of the bank. The senator said that First BankAmericano filled an important need as a lender for Hispanics in Union County.
Menendez said that he was first approached by Holly Bakke, the state’s former Banking and Insurance commissioner, to aid the bank. The senator denied having any contact with Ginarte or Lesniak regarding his letter.
Last fall, Menendez and three other New Jersey legislators were accused of pressuring the Food and Drug Administration on behalf of Hackensack orthopedic manufacturer ReGen Biologics, which had also made campaign donations to the senator and his political action committee.
One of First BankAmericano’s former directors, Frank Dominguez, is no stranger to scandal allegations. Dominguez has been indicted as part of a political corruption investigation in Perth Amboy. He is charged with padding invoices for the Perth Amboy public safety complex and using proceeds to pay for a lavish banquet that was intended to aid the unsuccessful re-election effort of then-Mayor Joseph Vas, who was also a member of the state Assembly.
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