By: Najla Alexander
NJ authorities announced that a Bergen County man who collected millions of dollars in fees from victims seeking funding for their commercial projects that he misappropriated in part for his personal benefit while failing to secure the promised financing was indicted.
U.S. Attorney Philip R. Sellinger said Jeffrey Kahn, 55, of Ridgewood, is charged with six counts of wire fraud and one count of money laundering.
Kahn was previously charged by complaint with two counts of wire fraud for the same scheme in November 2021, officials stated.
According to documents filed in this case and statements made in court:
From March 2018 through March 2020, officials said, Kahn devised a plan to defraud multiple victims of millions of dollars that were paid at Kahn’s direction to various accounts.
According to officials, those accounts include bank accounts in the name of Kahn’s financial advisory firm, Kahn Advisors, LLC – and characterized by Kahn as insurance premium payments, advance fees, or taxes in exchange for a promise of financing, including through an individual and a lender.
Officials stated to induce victims to pay money to Kahn, Kahn misrepresented to certain victims that he had conducted multiple successful financial transactions through the individual and the lender.
Kahn continued to vouch for the individual, even after Kahn received information that there was a strong likelihood that the individual, who claimed to have an office in Teaneck, New Jersey, but who is instead believed to reside abroad and to have used an alias in his dealings with Kahn – was not a legitimate lender, officials say.
Authorities say Kahn also caused others to make misrepresentations to certain victims regarding their purported successful financing deals with Kahn and/or the individual.
In reality, Kahn never obtained any financing from the individual or the lender for the victims.
Officials said Kahn further misrepresented to certain victims that the money they sent to Kahn and Kahn Advisors would continue to be held upon receipt until the victims provided their consent to the release of the funds.
Instead, according to officials, Kahn caused the victims’ funds to be transferred to other accounts, including bank accounts that Kahn controlled, without the victims’ prior consent and then used portions of those amounts to pay for Kahn’s personal expenses and to pay back other victims.
As a result of the scheme, Kahn caused the victims to transfer more than $5 million in funds to accounts controlled by Kahn or provided to Kahn by the individual, officials stated.
Kahn misappropriated approximately $800,000 of those funds for his own personal benefit and used an additional portion of those funds – approximately $447,000 – to pay back other victims of the scheme, officials said.
Each wire fraud count is punishable by a maximum of 20 years in prison and a fine of $250,000, or twice the gross amount of gain or loss from the offense, whichever is greater.
Officials say the count of money laundering carries a maximum potential penalty of 10 years in prison and a $250,000 fine, or twice the gross gain to the defendant or gross loss to the victim, whichever is greatest.