Trump Tenants

No U.S. address has been home to more of the unregistered brokerages that investors complain about, according to the Securities and Exchange Commission’s current public alert list….Trump took it over in 1995 in what may be the best deal of his career. No single property in his portfolio is more valuable than 40 Wall St…prosecutors have filed criminal charges against at least 29 people connected to 12 alleged scams tied to the building. Nine other firms have faced serious regulatory claims. Authorities prevailed in most but not all of the cases. Many were brought against principals, executives and other employees, not the firms themselves. Some are still pending. Here are the allegations, as well as descriptions of other firms in the tower that trade stocks and arrange loans….The tower was built to be the tallest in the world. It lost out, was foreclosed on and for a while was in the secret control of Filipino despots (hiding money for Marcos)….By 1993, the building was a “vertical ghost town” whose windows were dark while the rest of the Financial District glowed, the Associated Press reported. Kinson Properties, an arm of a Hong Kong-based footwear and real estate company, acquired it that year. Trump pounced when Kinson had trouble turning the building around, he wrote. He said he paid $1 million for the right to lease the building through 2059. A deal with lenders saved him from ruin. A few weeks before Trump signed the lease for 40 Wall St., friends threw him a lunch to celebrate his rebound, praising his comeback and even joking about a possible career in politics.Today, in addition to housing legitimate lawyers, architects and nonprofits, it offers a cheap way to grab a Wall Street address. The building’s average annual rent per square foot is $36, mortgage filings show, about $20 cheaper than the area’s average asking price and less than half of Midtown’s rates. At one point in 2010, according to regulators, brokers on the 34th floor were allegedly helping the financier on the 38th with a penny-stock scam; a brokerage on the 17th floor was involved in an unrelated fraud; and a bond-trading firm on the 42nd floor was bribing a Venezuelan official to win business. Trump Mortgage, on the 25th floor, was launched at the height of the housing bubble and closed in 2007. Trump wrote in his 2008 book “Trump Never Give Up” that tenants at 40 Wall St. are “many of the top-notch businesses in the world.”

DirectView Holdings, Convicted: CEO Roger Ralston was sentenced to five months in a halfway house in 2001 for bribing government employees to buy video-conferencing equipment.

Wolf Hedge, Convicted: Mark Malik, 34, pretended to have died from a heart attack when investors tried to withdraw money from his fake hedge fund, according to the SEC. He’s currently serving 5-15 years for swindling investors out of more than $800,000.

EJS Capital Management, Convicted: Brokers cold-called investors, pitching a currency-trading strategy, then spent almost all the money they sent in, according to a December civil court ruling. One of the operators, Alex Ekdeshman, 43, is serving a seven-year sentence after pleading guilty to another foreign-exchange fraud last year. (2015)

Barclay Metals, Convicted: The CFTC barred Sean Stropp from the commodities industry for five years in 2013 for this alleged precious-metals scam, which used a 40 Wall St. address. New York prosecutors also charged him that year with fraud. He was convicted and served almost two years in prison.

Rosabianca & Associates, Convicted: Real estate lawyer Luigi Rosabianca catered to foreign clients who sometimes paid with suitcases full of cash, he told New York magazine in 2014. “Real estate is a wonderful way to cleanse money,” he said. A year later, he was disbarred and charged with stealing $4.4 million from six clients, whose victims allegedly include a woman suffering from schizophrenia. Rosabianca pleaded guilty to grand larceny and will be sentenced this month to four to 12 years.

Spyker Consulting, Convicted:  Spyker principal Luis Ferreira was on supervised release from prison for a telemarketing scam when the firm leased space in the building around 2009. He was arrested in 2010 for violating his parole with the new scheme. He fled rather than return to jail, and is now on the FBI’s white-collar most-wanted list.

Essex & York, Convicted: The heads of this brokerage firm and six employees were accused in 2006 of running a $13 million pump-and-dump scheme. They allegedly cold-called investors and convinced them to invest in a temp agency, then sold their own shares when the stock rose. Seven pleaded guilty and one died before his case was resolved.

First Merger Capital, Convicted: The heads of this defunct brokerage took a $350,000 payment from a Chinese kitchen-appliance company and pushed its stock to investors, according to regulators. One of the co-heads filed an appeal this year after the SEC sided with Finra against the two men. Their partner Ronen Zakai, 45, spent most of last year in prison after being convicted of stealing the $705,000 he raised to invest in the Facebook IPO.

Evergreen International Spot Trading, Convicted: The firm’s currency-trading scam came to light when customers asked about their money after the Sept. 11 attacks. Prosecutors called one of the four executives convicted of cheating investors “the Michael Jordan of investment fraud” and said another faked his suicide after wiring money to Azerbaijan.

Direct Access Partners, Convicted: This bond-trading firm went bust after a bribery scheme surfaced in 2013. Prosecutors said executives conspired to make payments to a Venezuelan state bank official. Former CEO Benito Chinea is serving a four-year prison sentence, and four other employees also pleaded guilty to criminal charges.

The David Firm, Convicted: Earl David, a lawyer, was sentenced to prison in 2013 after using phony employment claims in what officials called one of the largest immigration frauds in U.S. history.

Stilas International Law, Sanctioned:  Matthew Bennett Greene was banned from practicing law in Virginia in 2009 after two clients claimed they paid for services he didn’t deliver. In 2013, Connecticut’s banking commissioner fined him for violating securities law related to investments in a B movie that promised investors 1,000 percent returns.

Aegis Capital, Sanctioned: The brokerage was fined $950,000 by Finra last year for helping a financier unload billions of unregistered shares of penny stocks. The firm didn’t admit or deny wrongdoing.

John Carris Investments, Sanctioned:  George Carris, who owned the firm, was expelled last year by the Financial Industry Regulatory Authority for selling shares of his brokerage without disclosing it was short of capital and for manipulating a penny stock. Regulators also alleged he spent company money on tattoos, liquor and motorcycles.

Banc de Binary, Sanctioned: This Cyprus-based firm operated an unlicensed binary-options brokerage in the U.S., soliciting investors with YouTube videos and spam e-mails to bet on whether stocks would rise or fall, according to the SEC, which sued in 2013. The firm and affiliates agreed to pay $11 million this year to settle regulators’ claims without admitting or denying the allegations.

Your Trading Room, Sanctioned: This currency-trading firm advertised that it taught secrets that “will change your life.” An Australian court ordered it liquidated in 2012 after a report that it was run by someone who had been banned by the country’s securities regulator.

GunnAllen Financial, Sanctioned: This Florida-based brokerage closed in 2010 after Finra said it didn’t have sufficient capital. The firm was overwhelmed by legal costs from some brokers’ involvement in two Ponzi schemes. “You cannot let the inmates run the asylum, and that’s where the firm failed,” its former general counsel was quoted as saying at the time.

Trump University, Settlement Approved:  CNN on March 31, 2017  New York’s attorney general is suing the unlicensed school for fraud. Students who signed up for real estate seminars were told they would be taught by experts hand-picked by Trump but were instructed instead by neophytes and bankrupt investors

New York Global Group, Facing Accusations: Benjamin Wey helped Chinese companies raise tens of millions of dollars in the U.S. before he was arrested last year and accused of securities fraud. U.S. Attorney Preet Bharara called him a “master of manipulation.” Wey has pleaded not guilty. He said in a court filing last month that his business was legitimate and the case against him is based on an illegal FBI search of 40 Wall St.

Felix Investments, Facing Accusations: Frank Mazzola, whose office was marked only by an 8.5-by-11-inch piece of paper, tried to raise money from investors by saying a fund he set up to buy Facebook shares had been approved by the social-networking company, according to a 2012 SEC lawsuit. After settling that case for $500,000 in 2014, Mazzola was sued by the agency in March for his ties to another alleged fraud. He said in court filings that he’s fighting the lawsuit.

Saddle River Advisors, Facing Accusations: John Bivona was sued by the SEC in March for fraud related to pre-IPO tech companies,a ponzi-like scheme. Bivona allegedly funneled investor money to relatives including his nephew, Frank Mazzola, also on the 17th floor. The SEC says the family used the money to pay the mortgage on a Jersey Shore vacation home. Both men denied wrongdoing in court filings. Bivona’s lawyer, Jahan Pierre Raissi, didn’t respond to messages seeking comment.

Patriarch Partners, Facing Accusations: Private equity manager Lynn Tilton, who was once in talks to star in a reality show called “Diva of Distressed,” had an office in the building for years. The SEC accused her last year of defrauding investors in three collateralized-loan-obligation funds, a case that’s still pending. A countersuit she filed against the agency was thrown out on appeal.

Forex Trading, Exonerated: The Commodity Futures Trading Commission accused the head of this business, Ross Erskine, of fraud in 2004 and said he had also set up Goros LLC as “a classic boiler room.” Erskine successfully argued that his currency-trading program wasn’t subject to the agency’s regulation. Judge Boyko found evidence of fraud but none that those in question were futures transactions.

A.B. Watley Group, Exonerated:  Day traders at this firm allegedly bribed Merrill Lynch and Citigroup brokers to allow them to listen in on the squawk box audio feed where brokers discussed clients’ trades. A jury found six participants guilty in 2009, but the convictions were reversed in 2012 because prosecutors withheld evidence.” Bloomberg

Trump International Hotel & Tower, Dubai

Does not own but licensed his name.