The Federal Bureau of Investigation (FBI) on March 28, 2013 released the following:
“Far Rockaway Man Charged with Defrauding Victims of $50 Million in a Real Estate Ponzi Scheme
Earlier today, FBI agents arrested Gershon Barkany based on a criminal complaint alleging that the Far Rockaway man defrauded investors by promising to use their money in “risk-free” deals to purchase and then immediately re-sell at a profit large real estate properties located in New York City and New Jersey. In fact, the complaint alleges that no such deals existed and the defendant defrauded victims of more than $50 million.
The charges were announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York, and George Venizelos, Assistant Director in Charge, Federal Bureau of Investigation (FBI), New York Field Office. The defendant’s initial appearance is scheduled for this afternoon before United States Magistrate Judge A. Kathleen Tomlinson at the United States Courthouse in Central Islip, New York.
According to the criminal complaint that was unsealed this morning, Barkany induced at least five investors to wire transfer large sums of money supposedly to purchase real estate in Manhattan, Queens, the Bronx, and Atlantic City, New Jersey. According to one of the investor victims, Barkany claimed that the sellers of these properties would only close on the real estate sales contracts after Barkany had located a purchaser who would be willing to buy the property from Barkany at a higher price. In that way, Barkany assured the victim that the real estate deals would be “risk free.”
In fact, the real estate deals did not exist. As part of Barkany’s Ponzi scheme, he diverted some of the funds he received to pay investors whom he had earlier defrauded. The defendant also lost some of the funds in gambling and otherwise used the money for his own benefit.
“Barkany’s victims sought the security of investing in real estate. Instead, they were taken for millions by the defendant’s lies and deception,” stated United States Attorney Lynch. “As alleged, the promised high returns were only for him, as he used his victims’ money to gamble and keep his scheme afloat. Today’s arrest demonstrates the Department of Justice’s commitment to investigate and prosecute financial crimes.” Ms. Lynch added that the government’s investigation is continuing.
FBI Assistant Director in Charge Venizelos stated, “As alleged, Barkany promised a get-rich-quick investment scheme that really had potential to enrich only him. There were no investment properties, just a house of cards built on a foundation of lies. There may be no truly risk-free investments, but investors are entitled to honesty.”
If convicted, the defendant faces a maximum sentence of 20 years’ imprisonment.
The government’s case is being prosecuted by Assistant United States Attorney Christopher C. Caffarone.
Defendant
Gershon Barkany
Far Rockaway
Age: 29″
————————————————————–
Douglas McNabb – McNabb Associates, P.C.’s
Federal Criminal Defense Attorneys Videos:
Federal Crimes – Federal Indictment
Federal Crimes – Detention Hearing
————————————————————–
To find additional federal criminal news, please read Federal Criminal Defense Daily.
Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition Defense, OFAC SDN Sanctions Removal, International Criminal Court Defense, and US Seizure of Non-Resident, Foreign-Owned Assets. Because we have experience dealing with INTERPOL, our firm understands the inter-relationship that INTERPOL’s “Red Notice” brings to this equation.
The author of this blog is Douglas C. McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.
