Developer, banker admit fraud

A prominent Villanova real estate developer and a senior executive of Royal Bank pleaded guilty to fraud yesterday in federal court in Philadelphia.

The developer, Mark Alan Mendelson, 52, also pleaded guilty to bribing the banker, Joseph Zakorchemny Jr., 57, of Aston, a former Royal Bank senior vice president.

In return for his help, Mendelson gave the bank executive $12,000 cash, a trip to a casino-hotel, and jewelry.

Sentencing guidelines call for at least a year in prison, Assistant U.S. Attorney Michael Schwartz said.

U.S. District Judge James Giles scheduled sentencing for Mendelson on March 25 and Zakorchemny on March 27.

The fraud and bribe occurred in late 2004 and 2005, as Mendelson sought to buy from Royal Bank a distressed Limerick flea market. He hoped to develop it into a shopping mall with a state-run liquor store.

Zakorchemny admitted he took the property off the market to allow Mendelson to buy it, though he knew Mendelson did not have the required $100,000 deposit. Zakorchemny and Mendelson lied to the bank about the deposit.

Mendelson had already obtained several leases for state liquor stores.

In a footnote to his guilty plea, prosecutors included an intriguing reference about an apparent gift to a former liquor board employee.

According to the government filing, Mendelson admitted that he had arranged a trip to Paradise Island in the Bahamas for "a now-retired employee of the Pennsylvania Liquor Control Board who was responsible for a number of Wine and Spirits Shop leases for stores located at properties owned and/or controlled by Mendelson."

The FBI has verified that account, officials said. No charges are expected in connection with the Bahamas trip, which occurred many years before the shopping-center fraud.

The LCB employee was not identified, and Schwartz yesterday declined to release the person's name.

LCB spokesman Nick Hays said last night that the board did not know who the former employee was. But, he added, "we are aware of the situation and are reviewing it."