LA developer charged in alleged $8M real estate Ponzi scheme
A Los Angeles man is facing 110 felony charges and three special allegations for allegedly running an $8 million Ponzi scheme involving the development of buildings.
Between 2010 and 2020, Jeffrey H. Tamkin allegedly ran the Tamkin Development Corporation and the Public Facilities Investment Corporation, the California Attorney General said in a press release.
Tamkin developed buildings for public agencies, and once developed, leased the buildings back to the agencies for a profit. He promised his investors — many of whom were elderly — high interest rates, provided them with investment memoranda and brochures, and personally guaranteed the investments, which many of his victims relied upon.
The information provided to investors — some of whom he recruited from organizations such as Hillcrest Country Club, the Cedars-Sinai Medical Center, and the Music Center’s Fraternity of Friends — omitted many material facts needed by the investors to determine the security of their funds, according to the release.
For example, Tamkin used investors’ funds to pay for his personal expenses and lifestyle, failed to tell investors that TDC and PFIC were operating at a loss or were earning minimal revenue from 2010 to 2020, and that he was operating a Ponzi scheme by using the funds to pay off earlier investors. Indeed, only two municipal projects closed during the time of the investments.
Tamkin’s actions led to a multi-million dollar loss, for multiple victims, over the course of a decade.
The charges against Tamkin include securities fraud, grand theft, elder theft, money laundering, fraudulent securities scheme, and an aggravated white-collar enhancement.
A copy of the redacted indictment can be found here.
Unfortunately, Ponzi schemes can be fairly common in real estate.
In Late October, it was revealed that Nanban Ventures LLC, a firm comprising three Frisco men, has raised nearly $130 million from hundreds of investors since April 2021, saying it was investing in technology and real estate. But “in classic Ponzi fashion,” Nanban allegedly used investors’ money to make fake distribution payments to other investors and siphoned off millions of dollars for themselves, as revealed in a recent complaint by the Securities and Exchange Commission, the Dallas Morning News reported.
The SEC has issued a temporary restraining order, froze the company’s assets and taken additional measures to stop the alleged perpetrators — Gopala Krishnan, Manivannan Shanmugam and Sakthivel Palani Gounder — from operating.
Also last month in New Jersey, Cesar Pina was arrested for allegedly engaging in a multimillion-dollar Ponzi scheme, the U.S. Attorney’s Office in the District of New Jersey announced. He was charged with one count of wire fraud and released on $1 million bond with electronic monitoring.
Pina and a celebrity radio personality partnered on real estate seminars across the country to help Pina build up a large social media following, according to the announcement. The radio personality wasn’t named in the documents, but previous reports have suggested Power 105.1’s DJ Envy was Pina’s business partner.
