Indicted lawyer Mark Nussbaum revealed the checklist of all his collectors and debtors, offering extra clues of the place the lacking cash from his agency’s escrow accounts went.
The lion’s share of lacking money seems to stem from funds transferred to the late actual property investor Mendel Steiner, who Nussbaum claims owes over $306 million. Different notable names are: Shaya Prager, Eli Puretz, Boruch Drillman and Yanky Tauber.
The brand new filings present a window into what went mistaken for the as soon as high-flying lawyer, whose legislation agency has about $400 million in unpaid collectors. Nussbaum supplied the checklist of all of the individuals who allegedly owe him cash as a part of a substitute for chapter.
Nussbaum, who ran Manhattan-based Nussbaum Lowinger, used his legislation agency’s escrow fund accounts to make bridge loans to actual property dealmakers, in accordance with sources aware of the scenario. Usually, his agency would offer cash for at some point in order that the dealmaker might present a vendor they had been capitalized.
However Nussbaum began operating a deficit, and traders and high-interest lenders who supplied the funds for Nussbaum’s escrow enterprise began submitting lawsuits in search of to recoup their cash. Nussbaum’s legislation agency shut down. In Might, the Manhattan District Lawyer’s workplace charged Nussbaum with grand larceny, alleging he stole over $15 million in shopper escrow funds. Nussbaum has pleaded not responsible.
Collectors allege in a brand new lawsuit that a lot of the funds had been diverted to Steiner by way of phony escrow accounts.
The brand new data involves mild as Nussbaum began another chapter course of, often called an task for the advantage of collectors (ABC), as a solution to attempt to pay again his legislation agency’s many collectors. As a part of that course of, Nussbaum had to supply an inventory of collectors together with the property of his property to the assignee of the ABC.
“As he has from the outset, Mr. Nussbaum continues to supply distinctive help to the assignee. This consists of offering data and troves of paperwork, in addition to assembly with the assignee and its representatives on dozens of events for numerous hours,” mentioned an lawyer for Nussbaum in an announcement. “Mr. Nussbaum totally helps the assignee’s efforts to marshal property from bona fide sources, together with the Steiner property, and he’ll proceed to help the assignee to the perfect of his capability to make sure most restoration for the collectors.”
Nussbaum’s property included jewellery, wine and cryptocurrency, however his largest asset is his accounts receivable. Nussbaum has a whole lot of tens of millions of {dollars} on the road and debtors who haven’t paid him again.
A few of Nussbaum’s notable debtors embrace members in mortgage fraud schemes that led to costs by the Division of Justice. Others embrace nursing residence traders and syndicators, in accordance with Nussbaum’s submitting.
- Boruch Drillman, a co-conspirator who performed a minor function in a $165 million mortgage fraud scheme and was not sentenced to any jail time, owes $4.7 million.
- Eli Puretz, a co-conspirator in a $54.5 million mortgage fraud scheme involving an workplace complicated in Troy, Michigan, owes $4.1 million.
- Opal Holdings head Shaya Prager, a controversial investor who has come below stress from lenders over his floor lease-structures inside a multi-billion-dollar workplace portfolio, owes $1.1 million.
- Yanky Tauber, Nussbaum’s deal companion on Chicago actual property, owes $1.5 million.
- Mike Silber, the brother of Moshe Silber, who pleaded responsible in a $119 million mortgage fraud scheme involving an residence complicated in Cincinnati, Ohio, owes $2.25 million.
- Steve Chopp, a nursing residence proprietor tied to Indigo Method and Opal Healthcare, owes $3 million.
The filings additionally reveal extra concerning the scale of Nussbaum’s actual property operations. Along with lending to actual property dealmakers, Nussbaum acquired actual property properties. His property consisted of properties scattered all through the nation, together with in Chicago; Brooklyn; Tulsa, Oklahoma; and Lengthy Island, in accordance with his filings.
He listed a 346,000-square-foot workplace park in Lake Success, New York as his Most worthy actual property asset at $33 million. Different actual property pursuits embrace walk-ups at 1596 and 1474 Pacific Avenue in Brooklyn, in addition to 1049 Bergen Avenue in Brooklyn.
Nussbaum’s property embrace: $2 million in crypto; $91,000 in wine and alcohol, together with a $1,000 bottle of Glendronach scotch. He additionally reported that he bought over $200,000 in watches and jewellery.
Nussbaum supplied a protracted checklist of collectors who he or his corporations owe cash to, together with Jacob Sod — the nursing residence proprietor who initiated the litigation in opposition to Nussbaum’s legislation agency — who has a declare of $14.2 million.
Somebody named S. Zafir is the most important creditor, with a $148 million declare. Miriam Nussbaum, Nussbaum’s mom, is owed over $1 million, in accordance with Nussbaum’s filings.
Whereas a few of Nussbaum’s collectors’ claims stretch into the tens of millions, there are dozens for smaller quantities, together with over $500,000 owed to Lazer Preizler of the exhausting cash lender Cashable.
Nussbaum’s capability to gather on the various loans he made has confirmed to be troublesome due to the indictment and costs introduced by the Manhattan D.A.
Equally, calculating the worth of Nussbaum’s current actual property has been a problem.
Mark Nussbaum and his deal companion, Eli Tauber, have been hit with a mixed 29 foreclosures lawsuits for actual property throughout the South and West sides of Chicago.
Nussbaum doesn’t seem to know the precise state of his properties with Eli’s son Yanky Tauber. In Nussbaum’s filings, he talked about that a few of his actual property with Tauber has been bought or transferred.
Learn extra
Mark Nussbaum begins bankruptcy alternative to pay off escrow clients
Creditors seek at least $400M from Mark Nussbaum’s former law firms
Manhattan DA charges dealmaker Mark Nussbaum with grand larceny
