J L Jens is Joseph Logan Jr., a consultant from Clifton
Guilty plea in dot-com stock fraud
Case is tied to 2 pitchmen found slain in Colts Neck
Tuesday, April 20, 2004
BY JOHN P. MARTIN
Star-Ledger Staff
More than four years after two penny stock promoters were found riddled with bullets in a Colts Neck mansion, a lawyer for one of them pleaded guilty yesterday to securities fraud, but said he knew nothing about the unsolved murders.
The lawyer, Allen Barry Witz, admitted in federal court in Newark that he and four other conspirators soaked investors by falsely pumping up a tech stock during the market's dot-com frenzy in 1999.
The crash of their company, Global DataTel Inc., occurred around the same time as the October 1999 gangland-style deaths of the two promoters, Albert Alain Chalem and Maier Lehmann.
The slayings fueled whispers about stock swindlers, money and the mob. Chalem, who reportedly had ties to organized crime figures, had been shot in his mouth, ears and eyes.
Speaking publicly for the first time, Witz said yesterday Chalem had once been his client, but that he knew nothing about the slayings.
"I talked to the government so many times to try to help them," Witz told reporters.
Witz did, however, help in other cases. His attorney, Lawrence Feld, told U.S. District Judge Joseph Greenaway that Witz had been cooperating with investigators for nearly three years, often "in a deep undercover capacity."
Fueling the mystery, Witz himself said after the hearing that his cooperation has placed him in danger. But neither he nor his attorney would elaborate. Michael Drewniak, a spokesman for U.S. Attorney Christopher Christie, also declined comment.
Robert Honecker, Monmouth County's first assistant prosecutor, said thus far Witz has not assisted in the homicide probe. But his office has been working with the U.S. Attorney's Office since shortly after the killings due to the tangled web of business dealings in which the victims engaged.
Honecker said Witz had business relationships with both victims that are still being investigated.
Witz's emergence could give new life to a baffling murder case that has long lain dormant. His admission to a single charge of securities fraud implicated four other men tied to Global DataTel. None has yet been charged.
One of them, Joseph Logan Jr., a consultant from Clifton, had visited Chalem and Lehmann at the Colts Neck mansion on the day they died. Calls to Logan's home last night went unanswered.
Witz, 63, who has homes in New York and Beverly Hills, Calif., was a lawyer specializing in mergers and acquisitions when he formed Global DataTel Inc. with Logan and Boca Raton, Fla., businessman Richard Baker. Witz and Logan were silent partners with more than 6 million shares in the company and Baker was its chief executive officer.
Early in 1999, the company launched a furious promotion, touting itself as a leading communications and Internet consulting company, particularly in Latin America. It claimed offices in Mexico, Brazil and Costa Rica and said its Internet service, eHola.com, headed by another conspirator, Mario Habib, would be the Latin rival to America Online.
A fifth conspirator, Stuart Bockler of Marlboro, hyped the company through his stock market Web site.
Investors bought the pitch.
After opening at $3 a share, the over-the-counter stock soared to as high as $16.83 a share. In four months, its market capitalization more than doubled to $378 million, as company representatives talked of registering millions of online subscribers.
In truth, investigators said, the company never really got off the ground. By November 1999, Global DataTel stock had plummeted back below $3.
The company later filed for bankruptcy and the Securities and Exchange Commission ordered Bockler to pay nearly $300,000 in fines and restitution and levied penalties of $25,000 against Baker and $15,000 against Habib. None could be located for comment last night.
The stock downturn occurred at the same time police were trying to solve the bloodshed in Colts Neck.
Chalem, 41, had lived at the lavish mansion with his girlfriend. His business deals ranged from cheap hotels to stocks, and had more than once drawn the attention of federal regulators.
Lehmann, a 37-year-old father of five from New York, previously had settled SEC stock-rigging charges. He also ran an investment Web site that touted penny stocks. Among the companies hyped on the site as a good buy was Global DataTel.
Prosecutors said the two men were business partners, but friends at the time disputed that. The pair had met only two years earlier.
Witz said yesterday he "represented" Chalem, but he declined to elaborate. Asked if he had seen the men around the time of their deaths, he said, "I have never been to Colts Neck in my life."
Assistant U.S. Attorney Mauro Wolfe, the prosecutor in the securities case, told the judge that under federal sentencing guidelines, Witz faces between 33 and 41 months in prison.
But, citing Witz's assistance, prosecutors are expected to ask the judge to depart from the guidelines and impose a much lighter term. Witz's attorney, Feld, said his client's cooperation reached back to 2001.
Asked if it included information about the Colts Neck case, Feld told reporters: "It extended to all matters that the government asked him about."
Staff writers Ted Sherman and Tom Feeney and the Associated Press contributed to this report. |
