Monday, December 12, 2016

HOA Tags Its Ex-Treasurer With Civil Racketeering Lawsuit Accusing Him Of Pilfering Approximately $1.3 Million In Homeowners' Maintenance Fees

In White Plains, New York, the New York Post reports:
  • The other Trump Tower — in White Plains — is in financial trouble after the condominium discovered its longtime treasurer had been allegedly stealing cash for years, according to a lawsuit filing.

    Frank Palazzolo, a real estate investor who was named one of the city’s 10 worst landlords by a former city housing commissioner, used the condo’s funds as his own personal “piggy bank” and covered his tracks with fake account statements, according to a suit brought by the condo board on Monday.

    The alleged theft, which the condo estimates at $1.3 million, has left the Westchester Trump Tower “in a precarious financial position — unable to pay for basic services and exposed to significant litigation risk,” said the Manhattan federal court filing.

    Neither Palazzolo nor his wife Mary — also named as a co-defendant — returned a request for comment.

    The civil racketeering suit says Palazzolo, who runs several companies out of the Palazzolo Plaza in Scarsdale, siphoned off as much as $8.7 million from the Westchester Trump Tower over the years. He did it by moving money from the condo’s accounts into accounts he controlled, the suit said.

    But he also pulled dirty tricks such as collecting over $200,000 in utility payments from tenants in the condo’s commercial spaces — and then leaving the residents to pick up the tab, the lawsuit said.

    Palazzolo, 64, used the money to make other real estate investments, including money to buy three foreclosed units in the Westchester Trump Tower for himself, the lawsuit said.

    He also used it to line the pockets of people who helped him with the alleged scheme, including board members who were named as co-defendants, the lawsuit said.

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