NEW YORK CITY—Developers Africa Israel Investments Limited, and Jeshayahu “Shaya” Boymelgreen have been barred from building condominium projects by New York State Attorney General Eric Schneiderman, pending a fraud investigation. The AG’s real estate finance bureau is investigating allegations of fraud in the offering of condo units at the Downtown Condominium, a Wall street development, related to the disposition of escrow funds, the developers’ obligation to complete construction and their refusal to relinquish control of the property to its rightful owners, those who bought and reside in the units.
“This fraud on homebuyers, conducted literally on Wall Street, is emblematic of the very worst conduct by property developers,” Schneiderman says. “Homebuyers at the Downtown Condominium were deprived of the most fundamental aspects of homeownership—a completed home and control of their property.”
The developers have been ordered by a Manhattan State Supreme Court Justice to deposit $470,000, monies which should have been held in escrow, into a court supervised account. The developers had represented to purchasers that these funds were being held in escrow to secure the completion of the Downtown Condominium development when they were not.
The order further requires Africa Israel to relinquish control of the residential condo board of the Downtown Condominium, a 400-unit condominium located at 15 Broad St., on the corner of Wall Street, to the unit owners. The Downtown Condominium sits directly across the street from the New York Stock Exchange, and a portion of it was originally built by J.P. Morgan in 1913. It is listed on the National Register of Historic Places and is designated as a city landmark.
Africa Israel declined to comment to GlobeSt.com and Boymelgreen could not be reached by press time. A request for comment from the Attorney General’s office was not returned.