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Florida real estate developer accused of fraud

During boom periods in Florida’s real estate market, there is ample opportunity for investors to turn a tidy profit by putting up money for development projects. When an investor partners with a developer, both sides expect that the other will act in accordance with the stipulations laid out in their contract agreement.

Unfortunately, rifts in the partnership can develop into full-scale disputes. Disputes based on deceptive business practices, perpetrated by one or even both parties, often result in civil suits. Should alleged wrongdoing be deemed illegal, the dispute may be elevated from civil to criminal court.

In Palm Beach County, in 2012, the state attorney’s office received claims of illegal acts perpetrated by a real estate developer who is based in Delray Beach. The claims were brought by the legal representation of one of the co-founders of the Subway restaurant chain.

The Subway co-founder and the developer were partners in a real estate deal intended to develop land located south of Orlando into a green community. However, the developer is now accused of taking funds intended for the project from the Subway co-founder and diverting them into his personal coffers. The developer has claimed the diversion of funds was done as a means of putting money in reserve in case the Subway co-founder exited the project.

The criminal charges are the outgrowth of civil suits started in 2009, wherein the parties countersued one another for fraud, each blaming the other for the ultimate failure of the project, which had started four years earlier.

At present, the developer has received charges for 19 crimes, 17 of which are for varying dollar amounts of grand theft. In addition, he is charged with money laundering and conspiracy to commit organized scheme to defraud. All told, these charges mount up to a possible 290 years of jail time.

If you have entered into a business partnership and found the other party is acting in a manner counter to agreed upon terms of the contract, you may need to engage in litigation. This is especially true if the other party is misusing or even stealing money that was intended for the purpose of business development.

A Florida attorney, familiar with the process of litigation, may be able to help protect your assets and even recover the losses you incurred as a result of fraud or breach of contract.

Source: sun-sentinel.com, “Delray developer fights fraud charges, Subway co-founder,” Marc Freeman, July 6, 2014

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