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A Brooklyn rabbi has just filed a $5.5 million civil lawsuit after falling victim to a scam perpetrated by a major Lakewood area ponzi scammer.

According to the complaint filed in New York Supreme Court in Kings County by Florham Park Attorney Paul H. Schafhauser:

In 2022, the scammer contacted the rabbi to solicit a series of investments in real estate joint ventures. He promised, represented and agreed that any funds invested by the rabbi would be dedicated to the purposes of the joint ventures and would be used for no other purpose.

On the basis of these promises, representations and agreements, the rabbi invested an aggregate of $5.5 million through a series of installments.

The scammer gave the rabbi his solemn word that he would receive "half of any profit” the joint venture obtained.

In addition, the scammer pledged to the rabbbi all of his assets - including both assets he currently owned and those he might acquire in the future - to guaranty the timely and full repayment of the amounts to be paid under the joint venture.

Even cooler, the scammer agreed that he would reimburse the rabbi all expenses and costs of collection incurred by the rabbi in case of the scammer's failure to timely pay!

Unfortunately, this get rich quick deal never materialized. The scammer diverted, converted and misappropriated the money or property for unauthorized purposes. The rabbi has not seen a single dime in return.

The ten count complaint seeks judgment awarding damages (including but not limited to compensatory, exemplary and/or punitive damages), plus pre- and post-judgment interest thereof, in an amount to be determined at trial; awarding treble damages and attorneys’ fees under the Consumer Fraud Act; granting attorneys’ fees, costs of suit, and interest; and granting such other relief as the Court deems just and proper.

As previously reported here on FAA News, this rabbi has also filed a separate lawsuit against this scammer in New Jersey Superior Court in Ocean County.

A Ponzi scheme is an investment fraud that pays existing investors with funds collected from new investors. Ponzi scheme organizers often promise to invest your money and generate high returns with little or no risk. But in many Ponzi schemes, the fraudsters do not invest the money. (In other words, the money gets misappropriated for their personal use, such as to pay off investors of previous non-existent "investments."

Sometimes, one or two unfortunate wrong moves can lead to a bottomless ponzi scheme in order to keep finding funds to cover the mishaps.

As first reported here on FAA News, this scammer was involved in purchasing nursing homes in Iowa and that purchase was the start of a massive domino affect on his scam of taking money from more and more people, which he needed to do in order to try to keep the nursing homes from crumbling completely.

In the new lawsuit, the rabbi alleges that as part of their joint venture, the scammer agreed that when he sold the nursing homes that he was purchasing, he would pay the rabbi an additional sum of $100,000, “which shall be included in the stipulated profit of the joint enterprise.”

The scammer has not yet answered the civil complaint.

A number of ponzi scandals have recently come to light regarding Brooklyn and Lakewood community members.

These scandals highlight why it's important, not only to be very careful prior to investing money, but also, prior to agreeing whom to partner with.

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Anonymous said...
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Sammy said...

Please name the scammer!!!!