ROXBURY, NJ – To hide their assets from creditors, the owners of the former Fenimore Landfill in Roxbury set up “sham” trust accounts for their children then illegally, and with help from their lawyers, raided the trusts to pay mortgages and legal fees, according to a state grand jury.
The allegations are made in a 33-count “superseding” indictment handed up Sept. 18. The new indictment replaces one handed up in 2016 that contended the site owners, Marilyn and Richard Bernardi, of Millstone, purposely hid assets from a bankruptcy court by not revealing the woman’s ownership of a real estate company.
In the new indictment, the grand jury says the couple spent money they placed in trust accounts in the names of their children, Richard Barnardi Jr. and Nicole Bernardi.
It charges the Bernardis with two counts of second-degree conspiracy, one count of second-degree theft by unlawful taking, two counts of second-degree misapplication of entrusted property and one count of second-degree fraud in insolvency.
The couple is also charged with 21 counts of third-degree misapplication of entrusted property, three counts of third-degree perjury and three counts of fourth-degree false swearing.
'Absolutely Nothing Wrong'
The grand jury also charged West Orange attorney Matthew Fredericks, one of the Bernardi’s lawyers, with a long list of crimes including second-degree conspiracy, second-degree theft by unlawful taking and second-degree misapplication of entrusted property as well as 33 counts of third-degree misapplication of entrusted property.
Reached Tuesday, Fredericks denied the allegations. “I’ve done absolutely nothing wrong,” he said, declining further discussion of the indictment.
Another Bernardi lawyer, Batya Wernick of Bloomfield, is charged with second-degree conspiracy, second-degree fraud in insolvency, third-degree perjury and fourth-degree false swearing. She could not be reached for comment.
The grand jury alleges the couple and their lawyer used the money to pay debt incurred by Strategic Environmental Partners (SEP), the company they set up around 2006 supposedly for the purpose of creating a solar panel farm on the site of the former Fenimore Landfill in Ledgewood.
The solar farm never materialized. Instead, the site was seized by the state in 2013 after fill material brought there in 2012 began to rot and spread noxious hydrogen sulfide over large parts of Roxbury.
In addition to criminal charges, there were a number of civil lawsuits filed both against SEC and by it against state and local agencies. But Roxbury officials – a year ago – said all the civil matters had been resolved.
Trust Funds a 'Sham'
Peter Aseltine, a spokesman for the state Attorney General’s Office, said the original indictment alleged the Bernardis “hid Marilyn Bernardi’s ownership of a company, Sussex Real Estate Services, LLC (SRES), by failing to list it as an asset in their Bankruptcy Schedule.” He said the Bernardis set up the trust accounts with money received from the 2015 sale of SRES.
“The Bernardis allegedly placed $600,000 in “Irrevocable” Trusts, to protect that money from their creditors, while they thereafter wrongly maintained control of those funds and treated them as their own assets,” said Aseltine in an email. “The “Irrevocable” Trusts allegedly were shams.”
The new indictment charges the Bernardis and Fredericks with Conspiracy, Theft by Unlawful Taking, and Misapplication of Entrusted Property (23 counts). It charges the Bernardis and Wernick with Conspiracy, Fraud in Insolvency, Perjury (3 counts), and False Swearing (3 counts).
“Because the Bernardis’ Bankruptcy Petition, Amended Petition and later Amendment to Official Form 107 were each signed under penalty of perjury, Richard Bernardi, Marilyn Bernardi and Wernick are each charged with both Perjury and False Swearing in regard to each filing,” explained Aseltine.