A.G. Schneiderman Announces Settlement With Tribeca Developer Over Unregistered Real Estate Securities

A.G. Schneiderman Announces Settlement With Tribeca Developer Over Unregistered Real Estate Securities

NEW YORK, NY – April 14, 2015 – (RealEstateRama) — Attorney General Eric T. Schneiderman today announced that his office has reached a settlement with 39 Lispenard Project, LLC and its former principal Peter Moore – the architect and prolific real estate developer of properties in lower Manhattan – for failing to register numerous real estate investments known as syndications under the Martin Act. The settlement brings to a close a lengthy investigation into Moore’s unlawful public offering of real estate investments in three offerings, including the unlawful offer of condominium units involving 39 Lispenard Street, a luxury loft development in TriBeCa.

“Promoters of real estate investments need to follow the rules and if they don’t, they will be held accountable,” Attorney General Schneiderman said. “The Martin Act provides necessary protections to all investors, including homebuyers seeking to purchase a condominium unit. Thanks to our settlement, Mr. Moore will take steps to ensure this important law is upheld, or face permanent consequences.”

The Attorney General’s investigation initially uncovered that Moore solicited and offered investments known as syndications in his company, 39 Lispenard Project, LLC, to members of the public – which would ultimately lead to ownership of a condominium unit – without making necessary filings with the Attorney General’s Office. Under the Martin Act, New York’s blue sky law that regulates securities, both syndications and the offer of condominium units require the filing of prospectuses, which must be provided to investors and purchasers before they decide to invest or buy a condominium unit.

Without making any attempt to comply with the Martin Act, Moore took blatant steps to procure investors in an unregistered syndication. He went so far as to hire a prominent New York luxury real estate brokerage firm – Town Residential – to assist in the public marketing and advertising of the project. Town Residential separately agreed to pay $7,500 in investigation costs and educate its brokers on the requirements of the Martin Act.

Under the settlement obtained by Attorney General Schneiderman, Moore has agreed to a six-month bar from offering or selling securities in the State of New York, in addition to making the required syndication filings with the office. Moore also agreed to conduct his business affairs legally in the future. If Moore violates any term of the settlement agreement, he will be barred from offering or selling securities permanently. In addition, Moore will pay a fine totaling $50,000.

During the course of the initial investigation into 39 Lispenard Project, LLC, it was revealed that Moore was involved in two other unregistered syndication offerings as well. As a part of the settlement, Moore has registered all of these projects with the Real Estate Finance Bureau.

39 Lispenard Project, LLC will also pay a fine of $5,000 and file an offering plan with the Attorney General before delivering condominium unit deeds to existing investors or offering for sale any other units to the public.

A copy of the settlement agreement with Mr. Moore is available here.

A copy of the settlement agreement with 39 Lispenard Project LLC is available here.

The investigation of this matter was conducted by Assistant Attorney General Nicholas J. Minella, Deputy Bureau Chief Andrew H. Meier, and Bureau Chief Erica F. Buckley, all of the Real Estate Finance Bureau, as well as Executive Deputy Attorney General for Economic Justice Karla G. Sanchez.

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