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Post date: June 29 2011

Condo Developer Yair Levy Permanently Banned From Selling Apartments In NY

A.G. Schneiderman Secures Full Judgment In Lawsuit Against Real Estate Developer Who Defrauded Homebuyers & Residents

Levy Raided Condo Reserve Fund & Used Money For Personal & Unrelated Business

NEW YORK- Attorney General Eric T. Schneiderman today announced the award of a full judgment in the case against Yair Levy and his company YL Rector Street, LLC. The decision permanently bans the former real estate developer and his firm from selling apartments in New York, and orders considerable fines and restitution for their illegal and fraudulent business practices.

"The State of New York has no tolerance for the kind of fraud perpetrated by Yair Levy," said Attorney General Schneiderman. "With today’s judgment, Yair Levy is out of business, and tenants and homebuyers in New York are more secure without this predator in the marketplace."

Last month, the Supreme Court of the State of New York found that Mr. Levy and his company defrauded the purchasers and tenants of the Rector Square Condominium in Battery Park City by emptying the condominium's reserve fund -- a fund meant to ensure the health and safety of the condominium's residents -- and by failing to make payments in lieu of taxes (PILOT) to the Battery Park City Authority. The Attorney General’s case, initiated by the office in June 2010, revealed that Mr. Levy spent the residents’ reserve fund on his personal and general business expenses. He then abandoned the condominium without heat or hot water in the winter of 2008.

The judgment won today permanently enjoins Mr. Levy and YL Rector Street, LLC, from engaging in any business activity related to the offer, sale or advertising of securities – which includes condominium and co-operative apartments. It also includes a $7.4 million award of restitution to the Rector Square Condominium. Levy has also been ordered to pay an additional $360,000 in civil penalties to the State for his illegal and fraudulent business practices, and the State was awarded another $4,000 in discretionary allowances from Levy and his company.

This case was handled by Assistant Attorneys General Jeffrey R. Rendin and Lewis A. Polishook, and Financial Investigator Percy Corcoran, under the supervision of Executive Deputy Attorney General for Economic Justice Karla G. Sanchez.

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