Not guilty plea to immigration scam charges

A former Wall Street lawyer pleaded not guilty Wednesday to charges he ran a massive immigration fraud scheme that federal prosecutors allege took in millions of dollars from tens of thousands of immigrants in the New York City area.

Earl David entered his plea to assorted charges of visa fraud and money laundering. U.S. Magistrate Judge Michael Dolinger in Manhattan rejected a defense request to free David on $1 million bail and instead remanded him.

Federal prosecutors said in court that David, who had consented to extradition and was brought from Canada earlier this week, was a flight risk. They charged that he had fled the area when subpoenas were issued in 2006 and since he has a Mexican wife might try to flee to Mexico. Outside court, defense attorney Avraham Moskowitz declined to comment.

From 1996 until 2007, according to federal prosecutors, David, an immigration lawyer with offices on Wall Street, exploited the country's employment certification process.

According to a federal indictment unsealed in October, David's scheme took in millions of dollars by charging high fees in return for securing legal immigration status for about 25,000 clients based upon phony claims that U.S. employers had sponsored the immigrants.

David's operation created false documents, found fake employment "sponsors," used a corrupt accountant to create bogus tax returns for fictitious sponsors, as well as a corrupt federal employee -- all in a scheme that "was stunning in its scope and audacity," said U.S. Attorney Preet Bharara.

Prosecutors filed charges Wednesday against 11 others who they say were involved in the scheme. Fifteen people were charged previously, eight of whom have pleaded guilty.

Allen Kaye, former president of the American Immigration Lawyers Association, said that hundreds, if not thousands, of immigrants are in jeopardy because of the case.

Federal officials would say only that they intend to uphold the immigration laws in the David case. They would not say how many immigrants who hired David are in jeopardy.

David, 47, an Orthodox Jewish scholar, allegedly laundered funds of the law firm through a bank account set up to handle proceeds from the sale of his Torah treatise "Code of The Heart," said Bharara.

Prosecutors said David, who was suspended as an attorney in New York, fled to Canada in 2007 to avoid the inquiry. He was arrested there in October.

The visa applications of many of David's former clients were tainted by the scheme, said lawyers assisting them.

One such family is the Sebagh clan of Roslyn Heights, here since 1996 from Israel. Henri Sebagh, 53, an information technology specialist, had to return to Israel in late 2010 and leave his wife, Mali, and the couple's three adult children in the United States because of visa problems from the David case. "We grew up here, did everything by the rules, were good citizens," said his oldest son, Yitzhak Sebagh. "How do you play with people's lives like that for your own benefit?"

Kaye said he has been involved with more than a half-dozen lawyers trying to help hundreds of David's clients.

"I can't even count the number of [Earl David] cases which have come to me," said immigration attorney Michael P. DiRaimondo, of Melville. "Some will be forced to leave."

With John Riley