Tuesday, May 7, 2013

Owner of Brighton Beach Russian-themed restaurant busted in $2.2M swindle

"Beware of debt settlement companies."
-Robert E. Brown, Esq.   

The feds filed suit today to seize an opulent, Russian-themed restaurant and cabaret in Brooklyn after its owner was busted on charges he funded the Rasputin Supper Club by ripping off clients of a crooked debt-relief firm.
Michael Levitis -- a suspended lawyer whose wife, Marina, was a cast member on the short-lived reality TV show "Russian Dolls" -- allegedly masterminded a multimillion-dollar scheme to soak credit-card holders struggling in the wake of the recent financial crisis.
Levitis, 36, and three employees of the Mission Settlement Agency allegedly promised to renegotiate and slash outstanding bills by up to 45 percent, but lied about the company's fees and did little or nothing to actually pay down the debts.
And while the company -- which used the Great Seal of the United States on solicitation letters -- collected about $6.6 million in fees since 2009, it only paid about $4.4 million to creditors, and never paid a nickel on behalf of 1,200 clients from whom it pocketed $2.2 million, authorities said.
"The true mission of Mission turned out to be fraud and deceit," Manhattan U.S. Attorney Preet Bharara said at a news conference this morning.
Bharara also revealed that two former Mission employees, Zakhir Shirinov and Feliz Lemberskiy, secretly pleaded guilty last month and are cooperating with the feds.
The charges against Levitis mark his second brush with the law in recent years.
In 2011, he was sentenced to three years probation and fined $15,000 for lying to FBI agents about serving as a bag man in a scheme to bribe then-state Sen. Carl Kruger, who's now imprisoned for corruption.
A Manhattan federal court indictment says Levitis and his co-defendants -- Denis Kurlyand, Boris Shulman and Manuel Cruz -- "systematically exploited over a thousand financially disadvantaged individuals across the country."
Philip Bartlett, the New York head of the Postal Inspection Service, described the victims as "both desperate and vulnerable."
He also noted that Levitis "ironically" used proceeds from the scheme to pay off credit-card debt incurred by his mom, Eva Levitis.
The case marks the first criminal prosecution based on complaints to the Consumer Financial Protection Bureau, which was established as part of the government response to the 2008 financial meltdown.
"These people are wolves in sheep's clothing," CFPB Director Richard Cordray said.
Cordray, who noted that "30 percent of Americans are being chased by debt collectors," also said that his agency was examining the entire debt-relief industry and predicted "there will be more" criminal prosecutions.
According to the indictment, Mission was purportedly owned by Levitis' mom -- who hasn't been charged -- but her son actually ran its day-to-day operations.
The feds also said that the title for the Rasputin nightclub is in Eva Levitis' name and that she "is the real owner of the club."
In addition to Rasputin, the feds are seeking to seize two other pieces of property and 40 bank accounts that were allegedly used to launder illegal profits from the scheme.
According to the Lifetime TV cable channel's Web site, the "spirited" Eva Levitis frequently went "head-to-head" on "Russian Dolls" with her son's wife, who favors "furs and diamonds" and "is all about status."
Defense lawyer Jeff Lichtman said: "Michael Levitis strongly denies these allegations which we've been aware of for months."
"Not only did he cooperate with the investigation but we tried, unsuccessfully, to present evidence to the prosecutors of rogue employees, no longer with the company, who were engaged in fraud at Mission," Lichtman added.
"Instead, those employees started their own debt settlement business and are continuing to defraud consumers while Michael Levitis is left to clean up their mess."
All four defendants are expected to be arraigned later today.
For more info click here: NYPOST

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