'Lakes' lawsuit

HAZLE TWP. - A federal judge has ruled 16 Valley of Lakes property owners are due a day in court.

U.S. District Court Judge William H. Walls, Newark, N.J., ruled Monday that sufficient evidence exists to let stand civil charges of racketeering against PNC Bank. A complaint by property owners accuses the bank of violating the federal Racketeer Influenced and Corrupt Organizations Act.

The bank tried to have the charges dismissed...

...in New Jersey because a developer of Valley of Lakes, Frank Cedrone of CBG Limited, had a headquarters there.

"It's about time people pay attention to the problems of these hardworking people," said the property owners' attorney, Roger Antao, of New York City.

In the complaint, the property owners allege PNC Bank took part in numerous racketeering schemes in the 4,000-acre Valley of Lakes real estate development.

Allegations raised in the complaint include:

• PNC Bank knowingly took part in a securities fraud scheme in which it wrote numerous mortgages for property it knew would never be developed.
• PNC Bank knew the developer of the property, Cedrone, had no legal right to take control of the development after the previous developer, Jack Halprin, of High Vista Corporation, was sentenced to prison on land sale and mail fraud charges. Halprin served six months in jail.
• PNC Bank took part in a scheme to conceal the insolvency of developer Cedrone, who filed bankruptcy in 1992.
• PNC Bank took part in several extortion schemes to "shake down" purchasers of property and the residents.

The bank denies any wrongdoing.

"We do not believe there is any truth to the allegations. We will defend ourselves vigorously," said John Fulgoney, chief market counsel for PNC Bank.

PNC Bank is also quick to point out that all of the allegations are based on events that occurred prior to its merger with First Eastern Bank.