Rabbi Zvi Feiner Settles with SEC But, “he won’t be able to satisfy it because…” Where is the Outrage?

People Should Be Outraged, Rabbi Feiner Settles Suit with the SEC; but it is Hard to Imagine any Sense of Remorse Given Comments by his Attorney to Crains

Crain’s Chicago Business reported the below information about the SEC settlement with Rabbi Zvi Feiner and the associates who swindled fellow Jews out of millions. But just to throw salt in the wound, the attorney representing Feiner and FNR, Mr. Ariel Weissberg a respected Chicago attorney, in his comments stated that his client doesn’t have the financial means to pay the SEC fines (or presumably to repay his victims). We wonder how much his attorney is getting paid to have thrown that salt in wounds of Feiner’s victims. This is not intended to in any way malign an attorney who did well by his client.

Should there not be a sense of outrage?

There is something very, very wrong with the statements made by Feiner’s attorney throughout the entire article, but perhaps the last paragraph speaks volumes about the righteous indignant response of the defendant.  The last paragraph in the article reads as follows:

Feiner settled two civil suits, even though one ended in a judgment in his favor, Weissberg said. “It was the right thing to do,” he explained. “In the Jewish Orthodox community, that’s what we aim for. . . .There’s a higher authority that needs to be answered.”

Really? In the Jewish world we should not be committing these crimes at all. There is nothing about this entire incident, lasting years, that reflects “the right thing to do.”

A Rabbi, someone who had the respectability of his community,  should be held to an almost unachievable standard of decency. Rabbi Feiner used the respect of those around him to lure them in and then he financially harmed his investors.

A braggadocios statement saying that the SEC fines will not be met because the Rabbi doesn’t have the financial means (as he apparently spent or repatriated that money to another country) should be leaving everyone with a really sour taste.

It is time that the Orthodox community remove the Hasmachut (Rabbinical Ordination) of those who commit crimes against the Jewish community. If, indeed, we are all looking to the same “higher power.”

Rabbi accused of defrauding Holocaust survivor, other investors settles Ponzi scheme charges

A Chicago rabbi and a business associate settled charges they operated a Ponzi scheme that triggered a $146 million default, the biggest ever for a federally insured loan program for nursing homes. Still at issue is how much the rabbi, Zvi Feiner, will pay.

Feiner, Erez Baver and their Skokie firm, FNR Healthcare, were accused by the Securities & Exchange Commission of defrauding an elderly Holocaust survivor and other members of Chicago’s Orthodox Jewish community. They siphoned off at least $11.5 million raised from 62 or more investors to buy nursing homes and assisted-living facilities throughout the Midwest, according to a complaint filed Sept. 19 in federal court here.

Feiner, 49, is an ordained Orthodox rabbi and sole owner of FNR. Without telling investors in limited liability companies, according to the complaint, he sold facilities owned by other LLCs and used at least $9 million in proceeds to pay other investors and lenders. Baver, 39, is FNR’s executive vice president. He and his company, Cedarbrook Management, received more than $2.5 million for personal use, the filing said.

While Baver and Cedarbrook have agreed to pay back about $2.25 million and a civil penalty to be determined, Feiner and his attorney are negotiating a figure. “It’s going to be a big number,” said Ariel Weissberg, a Chicago attorney representing Feiner and FNR. Whatever it is, Weissberg added, “he won’t be able to satisfy it because he doesn’t have the financial resources.”

Baver’s attorney, Stephen Rosenfeld of McDonald Hopkins’ Chicago office, said he would check with his client before commenting.

Starting in 2010, Feiner solicited funding for 20 LLCs including four cited in the SEC complaint. One of those four, Rosewood Care Centers, operator of a dozen nursing homes and an assisted-living facility in Illinois and St. Louis, was seized last year by the U.S. Department of Housing & Urban Development after defaulting on HUD’s $146 million loan.

To continue reading in Crains, click here.

 

A Platinum Reversal of Fortune for Nordlicht, Judge Releases Him with Warning

LAW 360

In Reversal, Ex-Platinum Boss Released After Night In Jail

Law360, New York (May 7, 2019, 8:32 PM EDT) — Former Platinum Partners co-founder Mark Nordlicht was ordered released from custody on Tuesday, a day after the New York federal judge presiding over his securities fraud trial revoked his bond for accosting a prosecutor.
To continue, subscription to Law360 Required.

LM Comments – [Opinion]

Suffice it to say that we do not completely agree with Judge Cogan, but mercy may be the better part of valor. We do hope, however, that the Judge takes the steps of revoking the bail as threatened, which would mean a significant dent in the Nordlicht trust fund pocket. We further hope that he is kept under lock and key.

We commend the defense team for whatever magic they performed here and hope the prosecution can present the case well enough to overcome what will likely be a defense based upon legal slights of hand.

We should all be reminded that the Platinum Partners frauds, multiple, over many years, involved numerous ventures and numerous shareholders, investors, families, trusts, retirement funds, people and livelihoods. These were far from “victimless crimes”.

We would argue that financial crimes and rape have many similarities. They are both power plays, violations of trust, the taking of something of great value, a complete humiliation and destruction of one’s dignity. Both leave generations of scars. They don’t end with the single or multiple victims, they are inherently paid forward, one in financial terms the other in how the entire world is viewed. We believe that financial fraudsters are in some sense financial rapists and should be treated the same in terms of the debt they owe to their victims and to society.

The final similarity – both rapists and financial fraudsters tend to be cavalier about their victims. That should not be ignored.

All Year Management Bondholders, Allegations of Misappropriations of Funds

Bondholders accuse Yoel Goldman’s All Year Management of breaching securities law in suit

A view of Denizen Bushwick at 54 Noll Street (Credit: Denizen Bushwick and Pixabay)

Yoel Goldman’s Israeli bondholders are alleging he misappropriated company funds, which they say caused their bonds to lose value, according to a lawsuit filed in Israel.

The suit accuses Goldman of putting $3.7 million worth of funds that should have gone to his company All Year Management into different company accounts that he controls.

The Israel Securities Agency — Israel’s equivalent of the Securities and Exchange Committee — had required All Year to correct financial statements with the Tel Aviv Stock Exchange earlier this month over this. The firm filed a notice concerning a “material error” in its second and third quarter financial statements linked to $3.7 million that was moved to Goldman’s personal account from the company’s account by mistake.

The value of All Year’s bonds fell sharply after Goldman acknowledged this, according to the lawsuit.

All Year did not respond to requests for comment. Commercial Observer first reported news of the suit.

The company’s bonds were downgraded on the TASE at the end of 2018 following steep declines in their value.

Other American firms have recently had issues on the TASE as well. Allen Gross’ GFI Capital Resources made hundreds of changes to its year-end report from 2017, including dropping its 2015 net operating income from $28 million to $8 million, and Boaz Gilad’s Brookland Capital announced in November that it would not meet its upcoming debt obligations. The firm’s Israeli bondholders moved to appoint someone else to oversee its BVI holding company soon after.

To read the article in its entirety click here.

 

Yoel Goldman and All Year – Allegations of Securities’ Law Breaches in Israel

Here’s Why Yoel Goldman’s All Year Has Run Into a Buzzsaw on the Israeli Bond Market

 

Why has Yoel Goldman’s All Year Management taken such a beating on the Tel Aviv Stock Exchange?

Over the last two months, the largely veiled Brooklyn-based developer has seen the bonds that he issued in Israel downgraded; investors have begun shorting All Year; and the company has come under the spotlight from Israeli regulators.

It all started after the company revealed a $3.7 million error in November 2018, triggering a weeks-long decline in their bonds on the Tel Aviv Stock Exchange (TASE), and heightened scrutiny from investors and regulators. As of last Friday, All Year’s four bond series had fallen between 6 and 23 percent since the beginning of 2019.

In the wake of that revelation more questions were raised, among them All Year’s practice of reporting income from developments that have not been fully leased yet, which have spooked Israeli bondholders, who have bankrolled much of Goldman’s empire, according to discussions with several investors and other stakeholders familiar with the Israeli market.

On Jan. 15, a group of bondholders filed a class-action lawsuit against All Year in a Tel Aviv court, arguing that the company had breached securities laws by failing to disclose certain details about the $3.7 million transfer, and claiming damages of at least NIS $2.5 million, or $680,000, according to the complaint.

All Year’s troubles come amid a tumultuous period on the Tel Aviv bond market that began in November, and all of the American companies who raised money in Israel were affected. Companies like GFI Real Estate, Starwood Capital, Spencer Equity and Delshah Capital have been trading at double-digit yields since December, and an index that tracks primarily American companies on the TASE fell by 3 percent since the beginning of 2019.

“All Year was one of the triggers that sent the market down, because that’s what made people realize that the corporate governance was lacking,” said one finance lawyer who works with foreign bond companies in Israel.

In the beginning….

Four years ago, Goldman, then a rental landlord and budding developer, made his first pitch to the Israeli bond market. He came to the Tel Aviv with a portfolio of mostly Brooklyn rental properties worth roughly $450 million in assets, according to public documents from All Year.

Goldman’s offer was perfectly timed to the height of the real estate frenzy in Brooklyn. Prices in the borough had risen astronomically in a decade and were continuing to climb at an astonishing pace. Everyone wanted to get in on the ‘next Williamsburg’ before it became the ‘new Williamsburg.’

Goldman was well-positioned to capitalize on the market because of his history in the borough, and when the option to issue debt in Israel opened up, he seized it. Since his first bond offer in 2015, Goldman’s All Year has nearly quintupled, with assets totaling $2.2 billion, according to the company’s latest financial statements, and he has become one of the more high-profile developers in Brooklyn. His projects include The William Vale hotel and The Azure at 436 Albee Square, which he developed with partners, 1040 Dean in Crown Heights and a massive, two-phase rental complex in Bushwick named Denizen, at 54 Noll Street and 123 Melrose Street, which is still under development.

A large portion of that development activity is funded by debt raised in Israel. Since 2015, Goldman has raised roughly $650 million in five bond series, issued by a corporate entity called All Year Holdings, which is incorporated in the British Virgin Islands, and owns a portfolio of over 150 properties. Two of All Year’s bonds are secured by properties in Brooklyn, and all of them are backed by the corporate entity.

“When he came to Israel he was a small player,” one investment executive said about Goldman. “The Israeli bonds made him an empire.”

Then All Year’s uninterrupted gold streak floundered.

Continue reading

Platinum Receivership Information

 

SECURITIES & EXCHANGE COMMISSION V. PLATINUM MANAGEMENT (NY) LLC, ET AL.

Platinum Receivership


AUGUST 15, 2018 WEBINAR VIDEO – Investor & Creditor Forum

July 23, 2018

VIA WEB POSTING

TO:
FROM:
RE:
Platinum Partners Investors and Creditors
Melanie L. Cyganowski, as Receiver
Investor & Creditor Forum

I am pleased to announce that I will hold a virtual forum for Platinum Partners Investors and Creditors on August 15, 2018 from 12:00 P.M. to 1:00 P.M. Eastern. During the forum, I plan to provide an update on the Receivership, including the steps I have taken since the last forum and our plans moving forward. There will also be time for questions.

Instructions for registering and participating in the forum by computer or telephone are provided below. If you would like to submit questions in advance, or have any questions regarding the forum, please direct them to platinumreceiver@otterbourg.com. Those participating by computer will be able to submit questions during the event using the computer service, but those participating by phone will be on mute and will need to send questions through the platinumreceiver@otterbourg.com email address. Finally, please note that we will utilize a court reporter, as well as video, to record the session. Thank you and I look forward to speaking with you soon.
Sincerely,

Melanie L. Cyganowski
Receiver

You are invited to a Platinum Receivership webinar.
When: August 15, 2018 12:00 PM (Eastern Time – US and Canada)

Topic: Investor & Creditor Forum

BY COMPUTER:

Please click the link below to join the webinar:
https://zoom.us/j/995380643

Please note: You must first download “Zoom” webinar software. Simply google “zoom.us” to download this free software.

OR IPHONE ONE-TAP:

+16699006833,,995380643# -OR- +16468769923,,995380643#

OR TELEPHONE:

Dial(for higher quality, dial a number based on your current location):
US: +1 669 900 6833 -OR- +1 646 876 9923

Webinar ID: 995 380 643

International numbers available: https://zoom.us/u/eBFnaDFpk

NOTICE OF ELECTRONIC SYSTEMS SECURITY INCIDENT

The Receiver is in the process of directly notifying certain individuals whose personal information may have been exposed as a result of a recent security incident involving a single email account on a cloud-based service used by Platinum. Specifically, Platinum recently identified suspicious computer-related activity and as a result, the Receiver immediately engaged LMG Security, a leading independent cybersecurity firm, which has been working to further secure Platinum’s systems, as well as conducting a comprehensive forensic review to determine the scope of the incident, including the specific data which may have been impacted.

Based on the investigation thus far, there was limited unauthorized access to a single email account on a cloud-based service used by Platinum from March 19, 2018 to May 19, 2018. Platinum is not aware of any impact on Platinum’s bank accounts or other assets as a result of this incident, nor is Platinum aware of any attempt to misuse any individual personal information which may have been exposed as a result of this incident.

In addition to its forensic analysis, LMG Security and Platinum took steps to minimize and prevent any additional unauthorized access to Platinum’s electronic systems or data. LMG Security’s findings have been reported to law enforcement and the Receiver’s team and professionals continue to work with the appropriate authorities.

While there is no evidence to suggest that there has been any attempt to misuse any of the personal information which may have been contained in the impacted data, those individuals who may have been directly affected by this incident have, or will receive, individual letters apprising them of the incident and informing them of the services which the Receiver is providing to them in an abundance of caution. Specifically, the Receiver, working with the cyber response team at Garden City Group, has established a call center to respond to inquiries by those individuals receiving letters from the Receiver, and is offering complimentary identify theft protection services through ID Experts®. This service includes 12 months of credit monitoring, a $1,000,000 insurance reimbursement policy, and fully managed id theft recovery services. With this protection, MyIDCare will help affected individuals resolve issues if their identity is compromised.

If you would like further information regarding the foregoing, please call (888) 866-5172.


JUNE 6, 2018 WEBINAR VIDEO – Investor & Creditor Forum

May 15, 2018

VIA WEB POSTING

TO:
FROM:
RE:
Platinum Partners Investors and Creditors
Melanie L. Cyganowski, as Receiver
Investor & Creditor Forum

I am pleased to announce that I will hold a virtual forum for Platinum Partners Investors and Creditors on June 6, 2018 from 12:00 P.M. to 1:00 P.M. Eastern. During the forum, I plan to provide an update on the Receivership, including the steps I have taken since the last forum and our plans moving forward. There will also be time for questions.

Instructions for registering and participating in the forum by computer or telephone are provided below. If you would like to submit questions in advance, or have any questions regarding the forum, please direct them to platinumreceiver@otterbourg.com. Those participating by computer will be able to submit questions during the event using the computer service, but those participating by phone will be on mute and will need to send questions through the platinumreceiver@otterbourg.com email address. Finally, please note that we will utilize a court reporter, as well as video, to record the session. Thank you and I look forward to speaking with you soon.
Sincerely,

Melanie L. Cyganowski
Receiver

You are invited to a Platinum Receivership webinar.
When: June 6, 2018 12:00 PM (Eastern Time – US and Canada)

Topic: Investor & Creditor Forum

BY COMPUTER:

Please click the link below to join the webinar:
https://zoom.us/j/995380643

Please note: You must first download “Zoom” webinar software. Simply google “zoom.us” to download this free software.

OR IPHONE ONE-TAP:

+16699006833,,995380643# -OR- +16468769923,,995380643#

OR TELEPHONE:

Dial(for higher quality, dial a number based on your current location):
US: +1 669 900 6833 -OR- +1 646 876 9923

Webinar ID: 995 380 643

International numbers available: https://zoom.us/u/eBFnaDFpk

DECEMBER 20, 2017 WEBINAR VIDEO – Investor & Creditor Forum

MELANIE L. CYGANOWSKI, RECEIVER c/o Otterbourg P.C. 230 Park Avenue, 30th Floor New York, NY 10169 E-mail: platinumreceiver@otterbourg.com Website: www.PlatinumReceivership.com

MARCH 1, 2018 WEBINAR VIDEO – Investor & Creditor Forum

Letter to Redress Bond – A Platinum Idea – Mark Nordlicht and More

MarkNordlicht

THE PLATINUM PARTNER AND THE FEE FOR HIS FREEDOM – BUT WHAT ABOUT THE VICTIMS?

Mark Nordlicht has apparently written a letter to the court asking for a reduction in Bond. We cannot publish the letter here because it is available on the PACER site for a fee. We have provided the links since August 6th. You will likely need to pay a fee to view the documents.
369
08/06/2018
Letter in Further Opposition to Defendant Mark Nordlicht’s Application to Travel as to Mark Nordlicht
370
08/07/2018
Letter in Response to Government’s Opposition as to Mark Nordlicht
372
08/08/2018
Letter by the government, dated August 8, 2018, requesting that the Court schedule a status conference regarding the defendant Mark Nordlicht’s bond and his travel to Israel as to Mark Nordlicht
08/09/2018
SCHEDULING ORDER as to Mark Nordlicht re 372 Letter. Status Conference set for 8/10/2018 at 9:45 AM in Courtroom 8D South. Ordered by Judge Brian M. Cogan on 8/9/2018. (Text entry; no document attached.)
373
08/09/2018
Letter Request to Appear Telephonically at August 10th Status Hearing as to Mark Nordlicht
08/09/2018
ORDER as to Mark Nordlicht re 373 Letter requesting to appear by telephone. Application Granted. Defense counsel shall call chambers at 718-613-2230 at the scheduled time. Ordered by Judge Brian M. Cogan on 8/9/2018. (Text entry; no document attached.)
374
08/09/2018
Letter Response to Government’s August 9th Request for Status Hearing as to Mark Nordlicht
08/10/2018
Minute Entry for Status Conference as to Mark Nordlicht held on 8/10/2018 before Judge Brian M. Cogan. AUSAs Lauren Elbert and Patrick Hein. Defense Counsel: Lisabeth Fryer and Ronald Sullivan by telephone. Counsel waives their client’s appearance for reasons stated on the record. (Court Reporter Sophie Nolan.) (Text entry; no document attached.)
378
08/16/2018
Letter Notice of Hearing on Government’s Motion to Readdress Bond as to Mark Nordlicht
08/16/2018
SCHEDULING ORDER as to Mark Nordlicht re 378 Letter. Hearing on Government’s Motion to Readdress Bond set for 8/23/2018 at 4:30 PM in Courtroom 8D South. Ordered by Judge Brian M. Cogan on 8/16/2018. (Text entry; no document attached.)