Homeowners try to force Mitchell Kossoff out of business
Real estate investors who say they have been scammed out of millions of funds blocked by attorney Mitchell Kossoff’s law firm now want to bankrupt the firm.
A group of four investors filed an involuntary bankruptcy petition on Tuesday against Kossoff PLLC, listing just over $ 8 million in “embezzled” escrow funds, according to New York Southern District bankruptcy court filings.
A representative of the Kossoff firm could not be reached immediately. The company has since deleted its website. The real deal first reported last week that founder Mitchell Kossoff appeared to be missing, leaving many of the city’s largest multi-family homeowners concerned about what happened to their escrow funds. Tuesday’s trial also claims he was not located.
The Manhattan District Attorney’s Office is also investigate Kossoff, Law360 previously reported.
The biggest debtor of the four investors who filed a lawsuit, Miami-based developer Gran Sabana Corporation, also filed a civil lawsuit in federal court alleging that Mitchell Kossoff violated the contract on their 4.5 escrow fund. millions of dollars.
“Rather than holding the money for the planned real estate transactions – as Kossoff agreed to do (and was required to do so by legal and ethical requirements) – Kossoff siphoned off funds from Gran Sabana, as well as funds from ‘other customers, out of the escrow account for personal use,’ the lawsuit asserted.
Other creditors in the bankruptcy case are United American Land, which says it is about $ 2.4 million short, Louis and Jeanmarie Giordano, who says it is about $ 1 million short, and Thomas Sneva , who claims he is missing more than $ 57,000.
The allegations echo those of at least two other lawsuits filed against Kossoff’s cabinet last week. Westchester-based investor Rob Yaffa and Long Island-based investor SSM Realty Group have each filed complaints about nearly $ 2 million in combined missing escrow funds.