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A former government at a outstanding New York Metropolis growth agency that collapsed amid an avalanche of investor lawsuits and foreclosures was arrested this week and is anticipated to be charged in reference to a multimillion-dollar fraud scheme, in accordance with a number of individuals with data of the case.
The developer, Nir Meir, was taken into custody on Monday on the 1 Resort South Seashore in Miami and was anticipated to be extradited to New York Metropolis on the fees, which had been introduced by the Manhattan district legal professional’s workplace, the individuals stated.
Not less than 10 individuals and companies had been anticipated to be charged in a collection of indictments introduced by the district legal professional, Alvin L. Bragg — a part of a sprawling net of suspected legal conduct involving Mr. Meir’s former firm, HFZ Capital Group, and its growth of a luxurious condominium challenge in Manhattan known as the XI.
These anticipated to be charged embrace a number of individuals concerned with the development agency Omnibuild, which labored on a minimum of one main HFZ challenge, together with a chief government on the firm, John Mingione, a few of the individuals with data of the matter stated.
The indictments are anticipated to cost that they conspired to steal tens of millions of {dollars} from traders within the XI by falsifying development prices from June 2019 till September 2020. Among the defendants within the case are scheduled to be arraigned as early as Wednesday.
A spokeswoman for the district legal professional’s workplace declined to remark. A consultant for Mr. Meir, whose arrest was first reported by Curbed, couldn’t be reached for remark. The costs in opposition to Mr. Meir are anticipated to incorporate tax fraud, falsifying enterprise data and grand larceny, together with theft that prosecutors imagine continued till late final 12 months.
Charles E. Clayman, a lawyer for HFZ, stated the corporate, which was additionally anticipated to be charged, wouldn’t remark till it noticed the indictments.
A spokesman for Omnibuild stated in an announcement that the corporate and the executives who’re anticipated to be charged had been harmless and forged them as victims of HFZ.
“The proof will present that HFZ stole from Omnibuild because it did from many others,” the spokesman, Josh Vlasto, stated.
HFZ sought to turn out to be a serious participant within the New York Metropolis actual property market, constructing and buying hundreds of luxurious condominiums in Manhattan.
On the agency, Mr. Meir helped elevate tens of millions of {dollars} from traders, typically rich foreigners. By 2019, the corporate managed greater than $10 billion in properties, it stated.
The corporate began to crumble after it started to develop its most bold challenge, the XI within the Chelsea neighborhood of Manhattan, a pair of twisting glass towers with high-end condos and a luxurious resort. HFZ spent $870 million for the event web site, and development began in 2016, led by Omnibuild.
However earlier than it opened, traders and contractors accused HFZ of lacking deadlines for funds and stated it owed them tens of millions of {dollars}. Omnibuild backed out of the challenge in 2020, claiming that HFZ owed the development firm greater than $100 million.
One outstanding investor in HFZ, Yoav Harlap of Israel, sued Mr. Meir in 2021, accusing him of refusing to return an almost $20 million mortgage and transferring round cash in private accounts to keep away from reimbursement.
Mr. Meir, 49, filed for chapter final week in Florida, the place he moved after leaving HFZ in late 2020.
The XI challenge went into foreclosures in 2021, earlier than it was accomplished, and it was purchased by two different builders, who renamed it One Excessive Line. It opened late final 12 months. HFZ misplaced 4 different apartment buildings in Manhattan in 2021 as properly.
HFZ was based in 2005 by Ziel Feldman, who was not anticipated to be charged within the scheme, in accordance with individuals with data of the case. His spouse, Helene Feldman, stated on Tuesday that the couple had no remark about Mr. Meir’s arrest.
In lawsuits in opposition to the agency, Mr. Feldman claimed he handed day-to-day administration of HFZ to Mr. Meir and blamed him for misspending its cash and inflicting its downfall.
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