Investors are accusing the Manhattan-based investment firm Capstone Business Credit, LLC of spending more than $150 million on failed Manhattan real estate deals. The lawsuit alleges that Capstone told investors at several major hedge funds that their money would not be used for real estate.
Capstone, led by managing members Joseph Ingrassia and John Rice III, lost a proposed 38-story condominium-hotel site at 158 Madison Avenue to lenders after defaulting on $34 million in loans. The site was sold earlier this year to J.D. Carlisle Development, according to the complaint filed in New York State Supreme Court. [more]