NEW YORK (Legal Newsline) - New York Attorney General Eric Schneiderman announced Friday he has obtained a court order against a Brooklyn attorney and his condominium developer clients to temporarily bar them from doing condo and securities-related work.
The order prohibits attorney Harold Gruber and his clients, Shiraz Sanjana and Joseph Scarpinito, from doing the work while a court case is pending. Scarpinito and Sanjana allegedly participated in a scam meant to defraud homebuyers that was facilitated by Gruber. The respondents to the order allegedly submitted at least nine false filings to the Real Estate Finance Bureau. They allegedly did this to avoid their obligations to deliver completed apartments to homebuyers, conceal the developers identities' and walk away with $3.2 million of purchasers' deposit monies, all while pinning the liability on Scarpinito's 83-year-old mother, Nancy Scarpinito.
The order requires the respondents to deposit $3.2 million with the Manhattan Supreme Court. The money is meant to secure obligations to 67 homebuyers at an eight-story development called the Mirada.
"Because of their egregious conduct and their failure to cooperate, my office sought a court order under the Martin Act that stops these actors from operating in the securities markets and safeguards the purchasing public and the victims at the Mirada as we continue to investigate," Schneiderman said. "My office is here to protect condominium and co-op buyers from fraud and it remains our priority to prosecute unscrupulous lawyers and developers who undermine the public trust with false filings."
The order also enjoins the respondents from engaging in any act related to the offer or sale of securities in the state of New York, requires the respondents to produce documents related to sales activity at the Mirada and forces Scarpinito and Sanjana to testify in open court about their condo sales and development at the Mirada.
Other respondents named in the order include the 110th Street Development LLC and The John Scarpinito Trust, entities which are both controlled by Scarpinito.