The Indictment provides a detailed overview of the MIP and Exclusive Homes Schemes, (see Id. 11-CR-31, 2012 WL 463973, at *4 (E.D.N.Y. A .gov website belongs to an official government organization in the United States. Now, Gold is back on the screen, as Million Dollar Listing New York season 7 airs on June 12.. Steve Gold on Million Dollar Listing New York has turned a lot of heads, and fans of the show . 28, 28(d), 32, 32(f)), in addition to 177 Lewis Avenue, (id. See United States v. Velastegui, 199 F.3d 590, 592 n.2 (2d Cir. In 2012, Josh Altman, Matt Altman, and Heather Altman made their " I Sell the Dream" music video to benefit the . 920 F.Supp. He was sentenced to six years in federal prison and will begin serving time by June 5. But all that largesse may have been a means to a selfish end. BuzzFeed News found at least 12 lawsuits in which borrowers said they had been deceived by the group. R. Crim. Free and open company data on Florida (US) company VC FL FUND LLC (company number L21000114994) 16 (citing United States v. Gabriel, 920 F.Supp. Love Brooklyn? 's Mem. Their Home Was In Foreclosure. provisions of the FCA. Tyler Whitman of "Million Dollar Listing: New York" has experienced quite the transformation during his time on the hit reality series. As alleged, these defendants fraudulently obtained homes at depressed prices at the expense of a taxpayer-funded program designed to assist borrowers seeking the American Dream of home ownership, stated Acting U.S. Attorney Seth DuCharme. Secure .gov websites use HTTPS (718) 254-6323. 2015) ("At trial, the [government must prove that [the] [d]efendant knowingly and willfully became a member of the conspiracy. (Id. HOCHUL FACES NEW NOMINATION AFTER HISTORIC REJECTION, RULING ALLOWS SOME POT DISPENSARY LICENSES IN NY TO GO AHEAD, 1-STORY PRODUCE MARKET TO BE DEMOLISHED IN BROOKLYN HEIGHTS. If a homeowner obtains approval for a short sale, the lender releases the mortgage after the short sale and submits an FHA insurance claim to HUD to cover the outstanding mortgage balance net of the short sale proceeds, plus approved costs and interest. 2004) (defining wire fraud). Lock The Indictment alleges that Herskowitz engaged in conspiracies to defraud lenders and certain borrowers (collectively, the "Short Sale Victims") "by providing them with false, misleading, and incomplete information to induce them to execute short sales at fraudulently depressed prices, causing losses to the lenders and, at times, the borrowers" (the "Short Sale Schemes"). The complaint details 10 times between 2013 and 2016 that the men Iskyo Aronov, RonBorovinsky and Michael Konstantinovskiy preyed on homeowners hoping to avoid foreclosure by setting up fake "short sales" of their homes through a federal program. 's Reply 1-2 (citing Ind. On April 29, 2019, a grand jury returned an indictment against Defendants Iskyo Aronov, Michael Konstantinovskiy, Tomer Dafna, Avraham Tarshish, and Michael Herskowitz, charging them with conspiracy to commit wire and bank fraud in violation of 18 U.S.C. The complaint, unsealed this afternoon by United States District Judge Margo K. Brodie, alleges that Iskyo Aronov, Ron Borovinsky, Michael Konstantinovskiy, and companies that they owned or controlled, engaged in fraudulent short sales of residential properties insured by the Federal Housing Administration (FHA) of the United States Department of Housing and Urban Development (HUD). Avraham Tarshish (also known as "Avi Tarshish") Age: 40 Queens Village, New York. The homes sold through the scam include nine in Brooklyn including three in Bed-Stuy and two in Bushwick and one in Queens Village, documents show. 18 U.S.C. He hosted friends at his $13 million home in Water Mill, LI, to play. (Order dated Sept. 12, 2019, Docket Entry No. Aronov and Konstantinovskiywere also charged in 2019. The act also permits the government to intervene in such actions, as the government has done in this case. RON BOROVINSKY Hollis Hills, New York. And for the first time . 1344 (1990); see also United States v. Calderon, 944 F.3d 72, 91 (2d Cir. The proceeds from the short sale, less approved closing costs, are applied to the outstanding mortgage loan balance owed to the lender, who typically agrees to forgive the borrowers remaining mortgage loan balance. 754, 757 (2d Cir. But the checks arrived like clockwork even as it seemed too good to be true. (Id. In the process, defendants made a host of material misrepresentations in critical transaction documents. Sign up for free Patch newsletters and alerts. In early 2018, 14 individuals and four companies filed civil suits accusing DAlessio of fleecing them. Heather Altman has been hit with surgery rumors since Million Dollar Listing Los Angeles returned to our screens. As a further part of the scheme, the defendants provided the mortgage lenders and servicers with false and misleading information in transaction documents and failed to disclose either payments made to the borrower and others related to short sale or contemporaneous agreements to transfer the properties at inflated prices. In furtherance of the Exclusive Homes Scheme, Herskowitz "wired $239, 483.88 to the [mortgage loan] servicer in connection" with the short sale transaction to purchase 177 Lewis Avenue. Do you have a story for The US Sun team? As one of the franchise's original cast members, Fredrik was a huge part of Million Dollar Listing's success. The series is a spinoff of "Million Dollar Listing Los Angeles," which premiered on Bravo in 2006. The scam in Monday's lawsuit caused millions of dollars in damages to the Federal Housing Administration since the men would file false or. One of Michael DAlessios property investments on the Upper East Side at 227 East 67th St. Michael DAlessios property investments on the Upper East Side, at 145 147 East 62nd St. 2023 NYP Holdings, Inc. 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Updated Jun 15, 2022 at 12:02am. He said he had officially hit "rock bottom" after almost passing out at a Phish concert in 2015. HUD, in turn, pays the lenders claim from federal funds. From December 2012 to January 2019, Iskyo Aronov, Michael Konstantinovskiy, Tomer Dafna, Avraham Tarshish and . ), The Government argues that the Indictment is sufficient to put Herskowitz on notice as to the crimes charged in conjunction with his alleged involvement in the Exclusive Homes Scheme, including that he "wired funds to [the loan servicer in order to] complete three of the fraudulent short sale examples described in the Indictment," and "that the loan servicer, in violation of the short sale conditions it had imposed, was not told of the actual purchase price or the amounts paid to the Short Sale Co-Conspirators." Please complete the form below and click on SIGN UP to receive daily e-newsletters from. ISKYO ARONOV (also known as Isaac Aronov) Submit your question here. Ryan Serhant, of Million Dollar Listing New York fame, was the broker on at least one of DAlessios projects. The complaint alleges that the defendants Iskyo Aronov, Ron Borovinsky and Michael Konstantinovskiy ran a wide-ranging mortgage scheme to defraud the Federal Housing Administration (FHA) of the US Department of Housing and Urban Development (HUD). We are proud to have partnered with the U.S. Attorneys Office for the Eastern District of New York in this case, said, , Federal Housing Finance Agency, Office of Inspector General, The governments complaint intervenes in a lawsuit originally brought by under the. f 42.). Bohm Eastern District of New York (Gov't Opp'n 11.). This allowed them to buy the properties for below-fair market value prices, obtain broker fees, and induce lenders to release the FHA-insured mortgages at a loss. Flagg lives in a $7 million mansion in Beverly Hills with his husband Bobby Boyd. In some cases, homeowners said the investors got them to sign over the deeds to their homes before the sales went through, claiming it was a normal part of the short-sale process. The defendants allegedly engaged in a scheme of wholesale deception when they provided false, misleading, and incomplete information to lending institutions, homeowners, and the Federal Housing Administration (FHA) causing millions of dollars in damages to the FHA, which typically results in higher premiums being charged to future first-time homeowners. Age: 48 To the extent Herskowitz seeks to challenge the truth of the allegations in the Indictment or the sufficiency of the Government's evidence, this presents a factual question that cannot be decided on a motion to dismiss. Rego Park, Queens, Tomer Dafna The Indictment further alleges that Herskowitz "assisted the Short-Sale Co-Conspirators in completing certain fraudulent short sale transactions originated by both MIP and Exclusive Homes," (id. Odabi and his co-conspirators callously abused the trust of an elderly victim to line their pockets with millions in stolen cash, stated United States Attorney Peace. The suit is brought pursuant to the False Claims Act (FCA) and the Financial Institutions Reform, Recovery and Enforcement Act (FIRREA). Aronov was the founder, CEO and president of defendants My Ideal Property Inc., My Ideal Property Group LLC and MIP Management Inc., and also controlled other affiliated corporate entities that he allegedly established to help him fraudulently acquire residential properties, according to the complaint. 186), the "conclusory, boilerplate allegations" in the Indictment implicating him in the short sale transactions associated with the MIP Scheme "need not be accepted as true, and may not sustain the charges where the detailed factual allegations are to the contrary," (Def. Aronov was the founder, Chief Executive Officer and President of defendants My Ideal Property Inc., My Ideal Propery Group LLC and MIP Management Inc., and also controlled other affiliated corporate entities that he allegedly established to help him fraudulently acquire residential properties. U.S. Attorney's Office, Eastern District of New York, Defendants Allegedly Engaged in a Scheme to Purchase Real Estate at Fraudulently Depressed Short Sale Prices Resulting in Millions of Dollars in False Claims Submitted to HUDs FHA Mortgage Insurance Program, United States Files Civil Fraud Suit Against Three Individuals and Multiple Real Estate Companies Alleging Mortgage Fraud Scheme, Owner of Brooklyn-Based Credit Counseling Business Indicted for Defrauding Clients, , , , Former Owner and Executive at Long Island Mortgage Lender Sentenced to 24 Months' Imprisonment for $8.9 Million Fraud. Under a company called My Ideal Property Group, the men pushed the scam to homeowners behind on their mortgage payments or facing foreclosures. [DAlessio] is a guy who got too big for his own britches., In an email published by Westchester County Business, DAlessio claimed: There was absolutely no fraud committed. At least 20 people have been convicted in alleged scams. Historical queries, urban legends, clarification on rumors let us do the research for you! U.S. Attorney's Office, Eastern District of New York, Real Estate Professionals Allegedly Conspired to Purchase Real Estate at Fraudulently Depressed Short Sale Prices, Costing Mortgage Loan Holders Millions of Dollars, Five Defendants Indicted in Mortgage Fraud Scheme, Georgia Man Indicted for Scheme to Defraud Elderly Suffolk County Victim of More Than $5 Million, Member of 5-9 Brims Gang Convicted of Brooklyn Murder, Former Investment Banker and Registered Broker Charged with Operating Cryptocurrency Investment Fraud Scheme. to Dismiss ("Def. Million Dollar Listing New York S03. In its opposition, the Government argues that "the Indictment is more than sufficient to put Herskowitz on notice as to those charged crimes" and "to the extent that Herskowitz complains about the quantity of evidence set forth in the Indictment, there is simply no requirement that an Indictment set forth the government's evidence, explain how it will prove the charges or allege all the specific facts that show that the defendant is guilty of the charged crimes." 41 Woodbine St., a flipped house in the Bed-Stuy neighborhood of Brooklyn. The individual defendants used various corporate entities to further their scheme. document.getElementById( "ak_js_1" ).setAttribute( "value", ( new Date() ).getTime() ); Thanks for contacting us. With regard to Counts Two, Four and Seven, Herskowitz contends that "the Indictment alleges only that [he] wired payoff and/or proceeds funds at the closing after all the arrangements for the sale had been made by others," but does not indicate that "he participated in or even that he was told of the short sale arrangements - instead, the allegations are that he simply showed up at the closing and conducted funds transfers as any closing agent would." DAlessio insisted that he, too, was suffering. Make your practice more effective and efficient with Casetexts legal research suite. Lock ("Counts One and Two"), and substantive counts of wire fraud related to specific transactions in violation of 18 U.S.C. Richard P. Donoghue, United States Attorney for the Eastern District of New York, Robert Manchak, Special Agent-in-Charge, Federal Housing Finance Agency, Office of Inspector General, Northeast Region (FHFA-OIG), and Christina Scaringi, Special Agent-in-Charge, U.S. Department of Housing and Urban Development, Office of the Inspector General, Northeast Region (HUD-OIG), announced the charges. Fed. To the extent Herskowitz contends that these factual recitations are insufficient to support the claim that he knowingly conspired to defraud the Short Sale Victims, he makes a premature challenge to the factual sufficiency of the Government's case. Join Facebook to connect with Isaac Aronov and others you may know. We are proud to have partnered with the U.S. Attorneys Office for the Eastern District of New York in this case, stated FHFA-OIG Special Agent-in-Charge Manchak. The Court denies the motion to dismiss because the Indictment tracks the statutory language of the charged crimes and provides sufficient notice of Herskowitz's alleged criminal conduct. Docket No. 1083 LAFAYETTE AVE. LLC. Tracy Tutor from Million Dollar Listing Los Angeles broke the fourth wall when she was seen telling a cameraman to capture a shot of her stiletto heel as she exited her car. Fax Line: 718-254-7508. at 757 ("[I]t is not necessary to allege facts with technical precision, but rather, to outline the essential elements [required by Rule 7(c)(1)]."). As Tutor . It alleges that Herskowitz: (1) "knowingly and intentionally conspire [d]" to "defraud the Short Sale Victims, which included financial institutions, and to obtain money and property from them by means of one or more materially false and fraudulent pretenses, representations and promises," and in executing the scheme, "cause[d] to be transmitted by means of wire communication in interstate and foreign commerce writings, signs, signals, pictures and sounds, contrary to Title 18, United States Code, Section 1343"; and (2) conspired "to defraud one or more financial institutions, and to obtain moneys, funds, credits and other property owned by such financial institutions, by means of one or more materially false and fraudulent pretenses contrary to Title 18, United States Code, Section 1344." Tracy Tutor Shows Off the Jaw-dropping Results of Her Recent Home Renovation. DAlessio was ordered to pay $58,090,047 in restitution and must forfeit all holdings purchased with funds from the scam. Great Neck, New York, Avraham Tarshish (also known as Avi Tarshish) 2019) (defining bank fraud). Fraudsters targeted homeowners hoping to avoid foreclosure. United States Attorneys Office After the sale is approved, HUD covers the outstanding mortgage balance,plus approved costs and interest, using federal funds. Subscribe to Patch's new newsletter to be the first to know about open houses, new listings and more. The "groupings" are: (1) "[f]rom approximately December [of] 2012 through December [of] 2016, [Aronov, Konstantinovskiy and Tarshish], together with others, worked on fraudulent short sales coordinated by [Aronov] where the primary beneficiaries of the Short Sale Scheme were the owners of MIP," and (2) "[f]rom approximately January [of] 2014 through January [of] 2019, [Aronov, Tarshish, Dafna and Herskowitz], together with others, worked on fraudulent short sales where the primary beneficiaries of the Short Sale Scheme were [Dafna and Tarshish]." 139.) The suit is brought pursuant to the False Claims Act (FCA) and the Financial Institutions Reform, Recovery and Enforcement Act (FIRREA). The partners negotiated with banks to let the property go for far less than market rate, a process known as short selling. Assistant United States Attorney Tanisha Payne of the Offices Civil Division is handling forfeiture matters. If you have experience and are savvy digitally, let us know about your interest in any of the following categories: creation of content and data for digital or print journalism promotion, sales and sponsorship packaging, management of a beat for environment, urban sustainability, real estate & business, food and drink, arts & entertainment, civic issues & politics, or hyperlocal neighborhood happenings. As a result, the Second Circuit "ha[s] consistently upheld indictments that do little more than to track the language of the statute charged and state the time and place (in approximate terms) of the alleged crime." 271 Cadman Plaza East 19 (citing Ind. 31(a), 31(e).) b. See Wey, 2017 WL 237651, at *5 ("An indictment does not 'have to specify evidence or details of how the offense was committed.'" 1S8C HOLDINGS LLC. It's no secret that Josh's wife is incredibly successful when it comes to real estate, but there is one thing . Accordingly, the Court finds that the Indictment is constitutionally sufficient and further finds that the inconsistency identified by Herskowitz is not sufficient to warrant dismissal of Count One, nor the related substantive counts of wire fraud charged in Counts Four and Seven. The Court denies the motion to dismiss the Indictment. UNITED STATES DISTRICT COURT EASTERN DISTRICT OF NEW YORK. In the process, the partners helped fuel the rapid gentrification of brownstone Brooklyn, displacing black and Latino families who in many cases had lived there for decades, and repopulating the area with young, mostly white professionals. We already knew that one longtime cast member was leaving the show and now two more. But that can be a long road, and one more difficult if borrowers were deep in debt. 2012) ("[A] federal indictment can be challenged on the ground that it fails to allege a crime within the terms of the applicable statute." The US Attorneys Office for the Eastern District of New York charged the men with conspiracy to commit wire fraud and bank fraud. Before the Court is a motion by defendant Iskyo Aronov (Aronov), pursuant to CPLR 3211(a)(7), for an Order dismissing plaintiff's Complaint on the basis that he cannot be held personally liable for plaintiff's injuries inasmuch as the Property, where plaintiff allegedly fell, [*2]was owned by co-defendant REDF Equities LLC (REDF), a valid New . The "New York" version made its debut in 2012 and ran for nine seasons. Borovinsky identified himself as a co-founder with Aronov of My Ideal Property. Lukas Vrbka is an independent reporter and researcher based in Brooklyn. Between 2013 and 2016, Aronov and his co-conspirators engaged in the "short sales" of nine homes in Brooklyn (three in Bed-Stuy and two in Bushwick) and one in Queens Village - acquiring the. Five real estate investors whose business was the subject of a major BuzzFeed News investigation were arrested this week for allegedly defrauding lenders and taxpayers out of millions of dollars in a scheme that targeted New Yorkers at risk of foreclosure. 36-39), Count Four (wire fraud in furtherance of the MIP and Exclusive Homes Schemes), Count Six (wire fraud in furtherance of the Exclusive Homes Scheme), and Count Seven (wore fraud in furtherance of the MIP and Exclusive Homes Schemes), (see Id. Another alleged co-conspirator was arrested in Florida. 1995); see also United States v. Gatto, 295 F.Supp.3d 336, 349-50 (S.D.N.Y. We are always seeking enthusiastic team members to help enhance and enlarge our content for and about Brooklyn. Aronov was arrested in Florida, and will appear this afternoon for a removal hearing at the federal courthouse in Miami. 1349 and 3551 et seq. ), In addition, the Indictment makes certain specific allegations regarding Herskowitz's involvement in the short sale transactions to purchase certain properties associated with both the MIP and Exclusive Homes Schemes as follows: (1) "on or about July 23, 2014, [Herskowitz] wired approximately $252, 755 to the [mortgage loan] servicer's bank account to satisfy the short sale payoff amount due" in connection with the short sale transaction to purchase 1219 Jefferson Avenue, (id. In turn, HUD paid the lenders claims for FHA insurance from federal funds. Many of these homes were located in economically challenged areas of New York where affordable housing is at a premium.. Main Office A .gov website belongs to an official government organization in the United States. There was one unusual aspect: DAlessio paid investors standard annual returns of 15 to 18% but personally guaranteed the dividends. The men face up to 30 years in prison and a $1 million fine if convicted in the federal case. 's Reply in Supp. (Def. The case is being handled by the Office's Business and Securities Fraud Section. Removal Hearing set for 9/11/2019 10:00 AM in Miami Division . iskyo aronov million dollar listing patton development company. Contact Lisa Riordan Seville at tom.gara+lisariordanseville@buzzfeed.com. These payments by HUD were artificially inflated as a result of the defendants fraudulent conduct. Iskyo Aronov ( also known as "Isaac Aronov ") Middle Village, New York, Ron Borovinsky, Hollis Hills, New York and Michael Konstantinovskiy, Roslyn Heights, New York have been charged in a wide-ranging mortgage fraud scheme to defraud the government. He was successfully renovating apartment buildings on the Upper East Side, as well as homes in blue-chip Westchester and beachfront Hamptons. In the process, they made a host of material misrepresentations in critical transaction documents. Here, the defendants fraudulently manipulated the short sale process by transferring properties for prices well above the short sale prices, and failing to disclose this to the mortgage lenders and servicers. The case is being handled by the Offices Business and Securities Fraud Section. Konstantinovskiy worked as an agent for My Ideal Property where he allegedly conspired with others to fraudulently obtain properties. It is on the. Viewers will get to see the big celebrity homes in the upcoming season of the reality show. (Id. However, the Indictment also contains specific factual allegations regarding Herskowitz's involvement in the short sale transactions to purchase 1219 Jefferson Avenue and 2403 Dean Street, (see Id. AG2 . As alleged, the defendants defrauded mortgage loan holders out of millions of dollars, with taxpayers saddled with much of the loss, stated United States Attorney Donoghue. Two years ago, BuzzFeed News revealed how this group of investors turned properties on the brink of foreclosure into million-dollar listings sold on the reality TV show Million Dollar Listing New York. If homeowners were defrauded or lost equity, they could file a petition in the forfeiture proceeding to be made whole. A locked padlock Thu 30 December 2021 15:38. Pursuant to HUDs Pre-Foreclosure Sale Program, qualifying homeowners with defaulted, FHA-insured mortgages may sell their properties in a short sale for less than the balance of the mortgage if the sale is for the fair market value of the property. According to the thirty-three-page Indictment, from in or about December of 2012 to January of 2019, Defendants, including Herskowitz, "worked both together and separately to purchase hundreds of properties at fraudulently depressed prices and then resell or 'flip' the properties for large profits." Under the FCA, private citizens with knowledge of fraud against the government can bring a lawsuit on behalf of the United States and share in the recovery. aaron fike obituary,