BROOKLYN, NY — A Brooklyn developer who federal prosecutors say took condo buyers and banks for more than $18 million in an elaborate mortgage scam was indicted Wednesday on bank fraud charges.
The case against Eliyahu Ezagui, 48, who feds say preyed on his fellow Hasidic Jews in Crown Heights, stems from a Daily News investigation last year. Ezagui enticed scores of families into buying the homes but never turned over the deeds, according to the indictment and The News' probe.
Developer Eli Ezagui Indicted in $18M Mortgage Fraud
BROOKLYN, NY — A Brooklyn developer who federal prosecutors say took condo buyers and banks for more than $18 million in an elaborate mortgage scam was indicted Wednesday on bank fraud charges.
The case against Eliyahu Ezagui, 48, who feds say preyed on his fellow Hasidic Jews in Crown Heights, stems from a Daily News investigation last year. Ezagui enticed scores of families into buying the homes but never turned over the deeds, according to the indictment and The News’ probe.
“The defendant engaged in fraud to steal money from innocent homebuyers and financial institutions,” said Brooklyn U.S. Attorney Benton Campbell.
Preconstruction prices ranged from $90,000 to $160,000 per unit at two locations, 770 Lefferts Ave. and 613 East New York Ave., according to the indictment and The News’ probe.
Ezagui told buyers, nearly all with young children, that the projects had the blessing of community religious leaders. Instead of giving buyers deeds when construction was completed, he kept them for himself, his father, his mother, his wife and two business associates.
Then, Ezagui took out more than $18 million in mortgages on apartments already purchased and occupied by the buyers and their families, according to the indictment. He pocketed the money, paid the mortgages for a time, then stopped and fled to Israel after The News broke the story, according to authorities.
Feds were waiting with an arrest warrant when Ezagui flew back and landed at JFK Airport July 13, 2008.
Many of the families are facing foreclosure on their apartments. Mortgage lenders including JPMorgan Chase, the Bank of New York, Sovereign Bank and HSBC, along with the condominium owners, have losses of about $18 million.
Last year, Ezagui said he took out the mortgages to pay off construction loans and other debt on the project and maintained that he is bankrupt. He is free on $3 million bail, but he’s confined to his home and is wearing an electronic monitoring bracelet.
His lawyer, John Meringolo, predicted Ezagui will prevail against the criminal charges.
“We feel the allegations in the indictment barely rise to the level of a civil case let alone a federal indictment,” Meringolo said.
About Time
It’s about time someone stood up to those taking advantage of us in Crown Heights!
Just a thought
If they put Ezagui and Rabashkin in the same cell that would save some money and make an easy car pool for visits.
Just what we need
Just what we needed another Jewish problem making headlines.
Rabbi Moshe Zigelman, Rabashkin, Ezagui, Madoff, scandels.
What’s next?
Guest of Honor
I guess the Maple Street Shul will have to find someone else to honor this year.
Eli Madoff
Can I say “Eli Der Ganef”? or is that too harsh? After all whats 18 million compared to 50 billion?
Friend
The ezagui family are such nice people. Dont let this degenerate loser change that. I know many of them personally.
Shmuli
I don’t know the Ezagui’s but I do know people who bought condos. People involved say that Ezagui did not do it on purpose, but made some big mistakes. He did expect that he would be able to pay back the mortgages, but as a result of some financial mistakes, he was unable to.
I do believe that this story DOES NOT BELONG on CH.info. What have we come to? Shaming and embarrassing people in public???
P.S. Back top the facts: The daily news did not break this story last year or ever. It has been going on for years. He had to run when the feds got involved. Well, although I don’t know for sure, that is probably thanks to the daily news.
The Truth that People Want To Ignore
He is a WONDERFUL man who paid all those people’s mortgages for years!!! They all turned on him when he was unable to pay their mortgages anymore and they would have to be responsible for themselves!! Well, those freeloaders did not like that one bit!! So they ran to the Daily News crying victim!!
He is a kind, quiet, loving family man. A man who’s son serves in the IDF and who was just terribly wounded. The courts allowed him to GO BACK to Israel to be with his hero son. If they were so worried about him, they never would have allowed him to go back to Israel. He returned back to Crown Heights, on schedule, and lives a quiet life, missing his family. Why don’t those residents pay their OWN WAY and leave this gentle man alone!
CN
I don’t think Ezagui meant to cheat anyone. I think he miscalculated the costs of these projects due to lack of propper planning, sloppiness and lack of experience, and got in over his head.
see u in hell
Nebach, I feel bad for the people in hell. They will have to sit with this lowlife. Or maybe there are special rooms for such people.
A Crown Heights Resident
To: “The Truth that People Want To Ignore”
I think you misunderstood what happened here. Mr. Ezagui over the years has had a profitable business building apartments in the neighborhood. In almost all his developments he offered deals on apartments prior to construction that you got a considerable discount if you paid 100% up front prior to the commencement of building. This allowed Mr. Ezagui access to cash on hand rather than rely on lines of credit from assorted banks. Upon completion and a Certificate of Occupancy, Mr. Ezagui was supposed to give these individuals the deeds to their apartments; which they were lawfully owed because they had purchased them prior to building.
What Mr. Ezagui is standing accused of is that instead of placing the deeds in the hands of the rightful owners he instead had the deeds issued to himself and family members, had mortgages issued on the properties and used the funds from the mortgages for other projects. Again instead of rely on the usual lines of credit from a bank. It’s like taking out of one pocket instead of the other with the intention that you’ll pay the first pocket back. This was unbeknownst to the people who *had already paid in advance for their apartments*.
Except allegedly Mr. Ezagui failed to continue to pay the mortgages and then the banks went to foreclose on the apartments. The people who thought they owned the properties but had never received deeds got eviction notices. That was how all this came to light.
Let me state it clearly and unequivocally: Mr. Ezagui was not doing these people a chessed and giving them a place to live for free or paying their mortgages for them. Allegedly he took their money and never gave them a deed for their property.
I assure you there are no shortages of shady real estate dealings in Crown Heights. I myself almost rented an apartment but backed out when I came to sign the lease. The lease was in the name of Rabbi A. The “owner” was Rabbi B who had purchased the house many years ago for cash but the deed never changed hands for “tax reasons”. Rabbi C was the de facto landlord (he collected the rent and lived in the house). And Rabbi D was who I was supposed to make the rent check to.
Doing off the books is NEVER a good idea and it would give all Yidden everywhere a much better name if we did everything legitimately. Honesty, especially when dealing with the government is the best policy.
Scum
HELLO!!! HE STOLE MONEY!!!! you cannot take a mortgage on somebody elses SOLD property without knowing you are stealing. He knew exactly what he was doing. What you are saying does not make a bit od sense.
Yossi
The benfit of putting this of CH.info is so that people know that we don;t tolerate crooks. Lo signov is in the same aseres hadibros and Shabbos and avodah zarah.
Mirmabuster
I would be laughing at “The Falsehoods that We Should Ignore” if it were not so sad.
What he did was to put mortgages on what should have been the buyers’ legally registered property by keeping the units on his name and on the names of relatives. I assume that some of the cash went to pay his contractors but plenty went to finance his double life in Florida.
In other words, he stole from the buyers and used the stolen property to steal more from the banks.
The Falsehoods is obviously a family member or Ezagui associate and deserves nothing but shame for being so deceptive.
the truth
HERE IS THE STORY!
which normal person in his right mind would think that he can actually pay for a condo in crown heights with 90,000???
Yes he did say he will sell it to them! but look at what these people had, 12 years of living in beautiful condos for 90,000??? where can you get that??? and now they go ahead and masser on him when he was doing them this great favor???
Anyone Can Cut and Paste from Newspapers
The people who write as if they “know it all” against this gentleman are only “cutting and pasting” from the newspapers. Their posts are word for word from news articles anyone can look up! So they take their “truth” verbatim from these news rags with agendas and their so-called exclusive stories?
These residents lived like kings in beautiful apartments thanks to this man! One of them told me they were furious when they finally had to pay something and so went to the newspapers! That was the thanks they gave! They paid next to nothing ($90,000!), had the rest of it paid by that man, and then never had the brains to finalize their paperwork. Because of this we are now trashing this poor man in public! Horrible!
I also think it is awful that these residents allowed their children to be used in photographs just to elicit more sympathy towards them! Incredible!
grossman
why do we always enjoy to hear other peoples down fall we should all join together achdus to help a fellow jew i know he has done wrong but why publishes more there is enough gossip going aroun=d imagine if this man was your father brother etc you would not want everyone talking about it
to the truth wrote
these people did not give hime the cash and then lived like “kings”. This was alot of money to those people at that time and they were promised the deed to the apartment. do you think that anyone would pay cash for an apartment and not wanting the deed are you insane. another thing is. not only did he do this to one building but to three buildings as well as screw people up in florida as well. how does hos trac record look like he as a honest nice man trying to HELP people. is that how you help people by screwing them up and there families?
awacs
“HERE IS THE STORY!
which normal person in his right mind would think that he can actually pay for a condo in crown heights with 90,000???”
Ten years ago? Pre-sale price, where the developer needs $$ for construction? Plausible.
favors like these who needs enemies?!
Anyone claiming this as a favor is despicable. There was a business deal the Mr. Ezagui broke. If he broke it legally, under circumstances that were out of his control, mimaile. If it was done illegally than as Yossi pointed out it is a big kiddush Hashem to publicise that we do not tolerate crooks in our midst.
As it is Orthodoxy, is coming under attack for the Hikind and Rubashkin factors. We must once and for all aknoledge publicly that no one is above the law when it is not directly against halachah.
Am Ha-aretz
To Yossi:
Lo Tignov of the Aseres Hadibros refers to kidnapping.
LoYechi770 Jerusalem
Ezagui is not even frum,I see him all the time in Jerusalem & he is bareheaded,cleanshaven & no tzitzis.
To call him a Lubavitcher is a joke!!!!!
He stopped wearing a yarmulka after he moved to Florida & yes I also saw him in Miami with no yarmulka.
A Friend
I was fortunate to meet Eli in Israel. He was Eli in his true being. He had parted with the lavish lifestyle and was a real person. I had spent much time with him and got to know him on a personal level. I saw him as emes and no b.s.
On many occassions I witnessed him trying to do what he could to help people. Strangers frequently came over to him to ask him advice about everything. He was always very friendly and ended up putting smile on everyones faces.
He is a family man and a good husband. Every Shabbos he was with his children at shul in Rechavia. He is very close to all of them and shows each one of them proper attention.
Only after meeting him did I learn of his unfortunate business dealings in CH. I was able to form an opinion of the situation without the media and Crown Heights hating. Eli simply had a business plan that went wrong. Unfortunately it effected local residents in Crown Heights. People make mistakes and everyone is far from perfect. It happens.
To judge a person based on if he wears a kippa or not is foolish. Let that be the job of g-d not yours. The intentions of ones self is more important then the levushim he wears.
The time to have ahavas yisroel is in a time like this. As difficult as it may be to “love a fellow jew” this is everyone’s chance to shine.
Believe me Eliyahu has suffered plenty. He is a strong person and continues to roll with the punches as hard as they may be thrown at him. All the negativity is simply kicking a man while he is on the ground. All you haters pat yourself on the back for being so tough with your keyboard.
It’s time for locals to wake up and smell the coffee. A brother needs help, a woman and her children need help. Step up and dont be plagued like Rabbi Akivas students were.
Eli may g-d bless you and your family. May you overcome all of your struggles and be re-united with your beautiful family.
Your Friend.
RobNYNY1957
According to this website, in 2000, the median cost of a house or condo in Crown Heights was $137,000, so the prices paid by EE’s purchasers were completely plausible. Especially when you consider that advance purchasers should get a discount on the price because of risk, and because they lose the use of the money for as long as it takes to build the apartment. By failing to issue deeds to the purchasers, EE stole from the purchasers. By taking mortgage loans on property he did not rightfully own, EE stole from the banks. I think it is safe to conclude that EE paid the fraudulent mortgages as long as he did only to conceal the crimes. (If he had not taken out the fraudulent mortgages, he would not have to do the “good deed” of paying the mortgage on someone else’s property.)
http://www.city-data.com/ho…
Estimated median house or condo value in 2007: $313,569 (it was $137,500 in 2000)