shady deal for new condo

contract was signed yet, trying to iron out the fine details.

Are you serious? You are considering knowingly and fully engaging in tax fraud and seeking advice? Run. that is the advice.

well other than run, is the another course of action i can take to turn the tables on this seller or get him to abide by the tax laws. i think threatening him will not do much as there is nothing in writing and he'll more than likely just find another buyer. from what i have heard he is doing this to all the buyers in the building (about 11 units in total). unfortunately i do not know who the other buyers are.

i know that it is fraud and illegal which is why i am seeking advice other than run.

Well what advice do you think you would receive? Do you think a lawyer will help you knowingly participate in a criminal act? Seriously, move along. There are lots of units in NYC. Sounds like this guy is a con artist and you are his game.

just wondering if someone has been thru this situation and maybe can shed some light on what they did? surely i am not the only one who has been thru this.

i am sure a lawyer will tell me the same thing you are and just say walk away. i was hoping perhaps maybe there is a way to work out the situation before i walk away?

i am also thinking that there is a possibility he is trying to get us to back out of this deal so he can sell it at a higher price since i got it at a very good price.

If the sponsor is being that shady I would really worry about what other corners he cut in the construction of the building. Just try to get him to pay up to fix the problems that will probably come up after people move in.

this is the sponsor/builder.
this was a pre-construction purchase. right now he has my deposit only (just a few k).

i guess i can walk away and just report him to the IRS since i believe he is doing this to all the other units in the building.

So you have signed contract and now he is trying to blackmail you essentially? Just enforce your contract. He's asking you to give him the capital appreciation in your investment. Get a lawyer. I would be quite surprised if others got duped by this scam.

I bought a coop for a relative and the owner tried to pull the same "under the table" deal. I happened to know the managing agent for the building and asked what they knew about the apartment. I was so glad I did because I found out that the owner was under investigation for tax fraud on real estate sales. Her bank accounts were being monitored for large deposits. I withdrew my offer and got a call from the owner a month later. She accepted our offer without the "under the table" amount. Good thing because there were a lot of hidden defects in the place.

I would not do business with w67thstreet.

I'm thinking I might call the DA & tell them the story & see what they have to say.

no contract just a deposit along with a sales order of good faith to lock me into that apartment.

after thinking about it some more, i am pretty upset since i waited a year for this to complete and now he wants to pull this shady thing.

who can i contact to get him investigated for tax fraud. i am sure this is not the first time he has done this.

Please tell me this is an April Fool's joke in December, and you're making this up to see if anybody is stupid enough not to realize this is, of course, a fake post.

If not----then you are talking about participating in a deliberate violation of federal and state law at the felony level.

And this developer will get caught. Somebody else buying in the building will report him to the police, and you, having participated in the scheme, will be caught easily after that. You get the money from an account somewhere, unless this is your pot-dealing cash from the sugar jar?, and the crook you're dealing with deposits the money somewhere, or gives it to somebody.

You should first of all call your lawyer, who we hope is really good and smart. Then I personally would call the police, unless my attorney advised otherwise, and I would call the IRS' tax fraud hotline no matter what to protect myself.

unfortunately this is not an aprils fool joke.

i spoke to one of the banks in that area, and they said it was fairly common for (xxxx) ethnicity builders to do this.

I have not participated in anything technically, i only made a deposit on hold the unit. I am sure if i backed out the deal i get my money back.

I actually want to report it or trying to force the sponsor to sell it legally.

Walk away. Quickly. This is not legal and you should not be involved in anyway with this.

If you have a completed signed contract you should be able to force the closing without any "special" payment. Check with your lawyer.

sorry i mis-typed the second post, contract was NOT signed.

Which ethnicity? And what neighborhood?

not that it matters - Asian ethnicity, i will leave it at that. some place in brooklyn (not park slope) sure you can figure out the general area if you really wanted too.

When dealing with xxxx ethnicity it is probably wisest to not try and get the DA after them.

If this is serious you need to walk away. This should not occupy your thoughts.

any real estate lawyers out there that can chime in on this?

OK, if you're not going to pay for a lawyer, then get your deposit back and run.

that's pretty much what i am leaning towards right now unless there is a way i can work out a legal sale.

I am going to consult some lawyers, i am expecting all of them to tell me the same.

somen00bie, is it on Avenue P in Brooklyn, by any chance?

somen00bie, if they are pulling this kind of crap, what makes you think every other aspect of the building was not also handled accordingly?

Chances are, there are many other issues awaiting the buyers of that fine building.

Learn to see the red flags, you will save yourself a lot of grief. Trust me, I know.

can we get some input from c0lumbiac0unty who is intimately familiar with fraud?

not its not on ave P. its fairly close, a few stops away.

i watch them build it from the ground up. i went there almost every month to inspect the work.

i spent a lot of time waiting for this and invested a lot of time as well.

to say the least i am pretty pissed off and upset. at this point i dont have a choice but to walk away if cant persuade the sponsor to make this a legal deal.

stakan do you know of a similar thing going on for ave P?

I feel for you, somenoobie. This is really sad. What's more you might be risking getting roughed up.

By the way, do you have any idea what $75,000.00 looks like in actual cash?

The biggest bill we have in the US now is $100.

this sponsor has not really thought things thru, how would he be able to even deposit all this cash without raising red flags? it would take him years to deposit all this money.

on top of this there is 11 units for sale, and from what the sales agent told me, he is forcing all the buyers to do this, that would net him about 750k roughly (assuming each transaction is between 60k-75k)

at this point if the deal cant be done legally, i will just ask for my money back, its not worth the risk or the hassle.

This is so confusing. Forget the whole tax fraud thing for a minute, since that's already been covered here.

How are you involved in this apartment? You don't have a contract, but the sponsor has a few thousand $ of your money. You've been waiting a year. Why oh why would you wait that long without having a contract or a leg to stand on? What is the couple thousand dollars getting you, exactly???

i put a deposit basically reserving that unit for purchase. there is a signed deposit slip with the unit that i wish to purchase, along with the correct purchase along with the deposit amount.

does that answer your question?

executed by both parties and notorized.

somen00bie - "i spoke to one of the banks in that area, and they said it was fairly common for (xxxx) ethnicity builders to do this."
Are you saying that the bank knows about the extremely illegal schemes like this one and keeps silent? Instead of, say, alerting everything with a pulse about this stuff going on?

Speaking of Avenue P, there is a supposed new construction taking place close to Bay Parkway, everyone listed on the applications is Chinese. While the neighborhood is still predominantly Russian and Korean, newish huge Chinese influx is very noticeable. I've heard about a few very much illegal construction issues with questionable companies.

How is it you can get a loan if the V in LTV is 75k lower than first contemplated?

stakan - the smaller banks on 8th ave. i guess they just turn a blind eye. at least that was according to one mortgage broker who said this is fairly common.

crescent at this point it doesn't really matter since i wont consider doing this illegal deal, but my original plan was to put down a down payment of 35%-40%, whatever the bank would allow.

I'm with MH. I don't understand what your deposit is for. I have bought off plans in Canadia and given a deposit, but that deposit was part of an agreement that entitled me to the apartment at xx price.

I am confused what the nature of your agreement was and why it is not enforceable. What does basically reserving the unit mean? Did you offer to pay him $$ in return for an apartment that would cost $XX? If so that sounds a lot like a contract.

Ottawwanyc yes that is exactly what it is, exactly as you stated, maybe i was not stating it clearly.
entitles me to THAT specific apartment at that price that we agreed upon (pre under the table illegal activity price)

basically he (the sponsor & sales agent) said in order to reserve THAT specific apartment i would need to put some deposit down to reserve it. reserving it meaning they will not show that apartment and consider it "sold".

The form (agreement) i signed was basically acknowledging the agreed upon price, the deposit amount, and the unit that I would be entitled to.

somen00b, I was not just referring to the construction, but to all aspects of their project - financing, capital reserves, etc, etc, etc, etc, etc... once they are long gone, will you be left holding the bag?

it is a good question though.. about the logistics of actually doing a deal like that.

Ottawanyc
about 8 hours ago
Posts: 772
Member since: Aug 2011
I'm with MH. I don't understand what your deposit is for. I have bought off plans in Canadia and given a deposit, but that deposit was part of an agreement that entitled me to the apartment at xx price.

Welcome to America MaCa(nadian)Ca(nadian)

So look what we have here--

An agreement in writing (because writing is required by the statute of frauds for real estate), signed by both(?) parties, with specific information (address/apt) and a monetary deposit (consideration). And everybody is old enough, etc.

Sounds like a contract from here. A mini contract, a bad contract, for sure, but a contract nonetheless.

If the developer didn't sign then, there's a question there.

It doesn't have to have the words CONTRACT at the top of the page to be a contract.

Please tell us what your lawyer does with this.

gcondo - i have no clue on the remaining aspects, still trying to figure out what to do...tbd, waiting for lawyer and a discussion with sponsor about making this a legal deal.

flutistic - yes an sales agreement, can we even consider that a contract of some sort.
would a sales agreement even be enforceable?
both parties signed and information was exchanged.
he deposited the check so we have his bank info and his name and I would so gladly report him to the DA / IRS

would it be considered extortion / blackmail if i threaten him to honor a deal legally?

somen00bie -- here's the gist. You are in contract to buy an apartment. This very much appears to be a legally binding contract, although a very bad one. Get a lawyer ASAP (you clearly don't have one, and didn't have one when you signed this thing, which was probably your first mistake). Have said lawyer send a nice, threatening letter to sponsor or threaten to sue for specific performance. There should be no negotiations with the sponsor about payment, you have a contract in place.

Now stop talking about this on a forum and go talk to a lawyer. You're going to need one to close, and they have a flat rate for closings, so its not going to cost you extra to start getting advice NOW.

thank you for your advice.

AMEN mh330 ! good luck somenooble, I hope it all works out great for you.

Also if you are really stuck financially call the Volunteer Lawyers for the Arts and see if they can slip you in somehow, someway. Some of those lawyers have sliding scale fees. You must have a guitar around somewhere right? ;)