Spitzer Announces Indictment Of New Jersey Man In $1 Million Real Estate Investment Scam

Attorney General Spitzer today announced the indictment of a New Jersey man for defrauding nine investors out of more than a million dollars in a real estate scam that began in 1997. The 23-count indictment charges that Rudy Lavanture, 29, stole money from investors while promising "guaranteed" rates of return of 30-70%.

Lavanture, and his company, Intrust Investment Realty, used advertisements in the New York Times to lure investors. Lavanture told investors that the company would purchase and then resell one-to-four family homes in the Tri-state area to individuals in low income areas at a substantial profit.

"The defendant in this case used a slick sales pitch and empty promises to steal a million dollars from unsuspecting investors," Spitzer said. "This case again demonstrates that investors need to be extremely cautious when "guaranteed" extremely high rates of return."

According to the indictment, Lavanture told investors that he was a broker representing the Department of Housing and Urban Development and that he had close a relationship with the agency, which would provide him with lists of available properties. He also claimed that their money would be used to purchase and renovate the properties, which would then be bought by pre-approved third-party buyers. Lavanture further perpetrated the scam by filing documents with the Department of State for a company named "HUD", enabling him to cash checks investors had made payable to "HUD".

As the scheme progressed, Lavanture continued soliciting money from new investors, who were assured their funds were being used to rehabilitate the homes and that the closings on the properties were imminent. Those investors who demanded their money back were given worthless promissory notes or checks that bounced.

The investigation was prompted by a complaint filed with Spitzer's Real Estate Financing Bureau. Among the charges Lavanture faces are two counts of Grand Larceny in the Third Degree, 10 counts of Intentional Real Estate Securities Fraud and seven counts of Grand Larceny in the Second Degree.

Lavanture faces a maximum of 15 years in prison for the each of the seven Grand Larceny Second Degree counts, and up to seven years in prison for the each of the counts of Grand Larceny in the Third Degree.

The charges against Lavanture are accusations and the defendant is presumed innocent until proven guilty.

The case is being handled by Assistant Attorneys General Rhonda Greenstein of the Criminal Prosecutions Bureau and Nancy Haber of the Real Estate Financing Bureau.