Home Business Prominent New York Developer Arrested on Charges Related to Huge Fraud Scheme

Prominent New York Developer Arrested on Charges Related to Huge Fraud Scheme

by SuperiorInvest

A former executive at a prominent New York City development company that collapsed amid an avalanche of investor lawsuits and foreclosures was arrested this week and is expected to be charged in connection with a multimillion-dollar fraud scheme, according to multiple sources. people with knowledge of the case. .

The developer, Nir Meir, was arrested Monday at the 1 Hotel South Beach in Miami and was expected to be extradited to New York City on the charges, which were brought by the Manhattan district attorney’s office, the people said. .

Other people and companies were expected to be charged in a series of indictments filed by District Attorney Alvin L. Bragg as part of a sprawling web of alleged criminal conduct involving Mr. Meir’s former company, HFZ Capital Group. .

Among those expected to be charged are people involved with the construction company Omnibuild, which worked on at least one major HFZ project, including a company director, some of the people with knowledge of the matter said.

Some of the defendants in the case are scheduled to be arraigned Wednesday.

A spokeswoman for the district attorney’s office declined to comment. A representative for Mr. Meir, whose arrest was first reported by Curbed, could not be reached for comment.

Charles E. Clayman, an attorney for HFZ, said the company would not comment until it saw the allegations.

An Omnibuild spokesperson said in a statement that the company and the executives expected to be charged were innocent and portrayed them as victims of HFZ.

“The evidence will show that HFZ robbed Omnibuild as it did many others,” said spokesman Josh Vlasto.

HFZ sought to become a major player in the New York City real estate market, building and acquiring thousands of luxury condominiums in Manhattan.

At the firm, Meir helped raise millions of dollars from investors, often wealthy foreigners. By 2019, the company managed more than $10 billion in properties, he said.

The company began to unravel after it began developing its most ambitious project, the XI in Manhattan’s Chelsea neighborhood, a pair of twisted glass towers with high-end condominiums and a luxury hotel. HFZ spent $870 million on the development site and construction began in 2016, led by Omnibuild.

But before it opened, investors and contractors accused HFZ of missing payment deadlines and said it owed them millions of dollars. Omnibuild withdrew from the project in 2020, claiming that HFZ owed the construction company more than $100 million.

A prominent investor in HFZ, Yoav Harlap of Israel, sued Meir in 2021, accusing him of refusing to repay a nearly $20 million loan and moving money into personal accounts to avoid payment.

Meir, 49, filed for bankruptcy last week in Florida, where he moved after leaving HFZ at the end of 2020.

Project XI went into foreclosure in 2021, before it was completed, and was purchased by two other developers, who renamed it One High Line. It opened at the end of last year. HFZ also lost four other condo buildings in Manhattan in 2021.

HFZ was founded in 2005 by Ziel Feldman, who was not expected to be charged in the scheme, according to people with knowledge of the case. His wife, Helene Feldman, said Tuesday that the couple had no comment on Meir’s arrest.

In lawsuits against the company, Feldman claimed that he turned over day-to-day management of HFZ to Meir and blamed him for wasting his money and causing its downfall.

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