Just… read it. Just work your way through it. I promise it will bring a smile – and maybe even laughter! – to your face.
Excerpts:
‘Merchants Hospitality has filed an explosive lawsuit against former partner Adam Hochfelder, accusing him of running a Ponzi scheme, embezzling investor money and retaliating against his former associates after he was fired in June.
In a complaint filed in New York State Supreme Court last week, Merchants claims it went out on a limb to help Hochfelder get back on his feet after a two-year prison stint, only to catch him stealing from the firm and using its name and assets to defraud unsuspecting investors and partners…
Hochfelder went to prison in 2010 after pleading guilty to 15 counts of grand larceny and three counts of scheming to defraud his uncle, in-laws and other investors out of more than $18 million. He left prison and was hired by Merchants in 2012.
Now, eight years later, Merchants accuses Hochfelder of embezzling funds from its West 42nd Street hotel project — the site of a failed effort to run a high-priced Playboy Club in New York — and using his affiliation with the firm to run a $400,000 Ponzi scheme through his company email…
[Hochfelder] accused Merchants of fabricating the scheme by breaking into his computer and creating false documents…
Merchants brought Hochfelder on board during his prison stint to spearhead acquisitions and development for the firm…
In 2014, Merchant, the firm’s CEO, called hiring Hochfelder “one of the best decisions we ever made.” And in 2017, after allegations of sexual harassment against Hochfelder surfaced, [the CEO] defended Hochfelder, saying, “It’s easy for him to be a pinata because of his past. But I think everybody deserves a second chance.”…
Merchants claims it conducted an investigation into [one particular] embezzlement … and Hochfelder ultimately admitted to the scheme and begged his partners to let him repay the money, citing “his own psychological issues and problems with drugs,” according to the September lawsuit…
Hochfelder [allegedly] collected $125,000 for an investment in the Bryant Park Hotel, which Merchants does not own. The complaint also alleges that Hochfelder offered an interest in Merchants’ Z Hotel in Long Island City but had the investor wire $75,000 to an LLC owned by his wife.
On top of those accusations and the alleged $4 million payment withheld by Roche, Merchants says Hochfelder has left the firm with months of overdue car payments, traffic violations and an ongoing eviction proceeding at his Midtown apartment…’