Thursday, 25 August 2016
Last updated 19 hours ago
Jan 28 2010 | 11:22am ET
The liquidation of accused Ponzi schemer Arthur Nadel’s business empire is continuing apace with the sale of a home construction company owned by the Florida hedge fund manager. And the court-appointed receiver in the case also plans to go after a home owned by one of Nadel’s alleged co-conspirators.
Burton Wiand has sold what’s left of Home Front Homes, an Englewood, Fla., construction company in which Nadel was the majority owner. The receiver seized the company, which built energy-efficient, panelized homes, in August.
Nadel is alleged to have poured $2.1 million from the six hedge funds he controlled into Home Front, but investors won’t see nearly that return. South American Development Corp. has agreed to buy the company’s assets for just $250,000, and more than $100,000 of that will be turned over to M&I Bank, which has agreed to waive $3 million in Home Front’s debt.
Nadel’s alleged victims will get just $95,300 for their unknown, unwanted $2.1 million investment.
“Because Home Front Homes is no longer a going concern, its only value is in the assets it owns,” Wiand explained in a court filing.
Meanwhile, Wiand yesterday moved a federal court to hand over a Sarasota, Fla., condominium owned by Neil Moody, on whose behalf Nadel was managing three hedge funds. Moody and his son, Christopher, have agreed not to dispute the Securities and Exchange Commission’s securities fraud allegations against them, although they have neither admitted nor denied any wrongdoing in the Nadel case.
“In light of the large sums of scheme proceeds that flowed into the same account from which mortgage and other payments relating to the property were made and Neil Moody's uncontested fraudulent role in the scheme, the receiver is entitled to take possession, control, and ownership of the property for the benefit of defrauded investors,” Wiand wrote.
Moody bought the seventh-floor condo on the bay in downtown Sarasota in 2006. The property features a dock and a private elevator. Moody paid $2.16 million for the place; it is now on the market for $2.5 million, but has found no takers in almost a year.