Adam Hochfelder, the real estate executive who pleaded
guilty earlier this year to defrauding investors, relatives and lenders out of more than $18
million, was sentenced to a minimum of two years, eight months and a maximum of eight years in prison today. He must also pay $9.5 million in restitution.
Judge Michael Obus said for a nonviolent crime Hochfelder’s was “about as serious as it gets,” but he added that many of the victims did not want to see Hochfelder punished severely and that he believes Hochfelder’s remorse is “sincere.”
Hochfelder, who hugged family members upon entering Manhattan Supreme Court, sat silently for most of sentencing before seeking leniency in a statement. “My commitment to all of you is to make amends and to pay restitution,” Hochfelder said during a tearful speech in which he also apologized to his two young sons. “I have done everything humanly possible to make this right,” he said.
Hochfelder’s attorneys sought a two- to six-year sentence, saying that Hochfelder, 39, turned himself in and that psychiatric evaluations showed the crimes were caused by a combination of bipolar disorder and drug abuse. Once he went into rehab, they said, the crimes stopped and he began making money legitimately again. The defense read letters from Hochfelder’s son, ex-wife and several victims in support of leniency, who argued that the sooner he emerges from incarceration, the sooner he’ll be able to pay back the stolen funds.
Prosecutors, meanwhile, asked for the expected four- to 12-year sentence. They read a letter from Hochfelder’s brother-in-law who said “to this day, Adam has declined to apologize to his family,” which is now locked in costly litigation over control of an apartment at 1025 Fifth Avenue that Hochfelder owned with his then-wife, Amy.
Hochfelder allegedly used the apartment as collateral for a $1.3 million loan from Arbor Commercial Mortgage. The lender required Hochfelder to provide written consent from his father-in-law — who lived in the apartment — and other family members, so Hochfelder forged their signatures, according to prosecutors. As a result of the transaction, the family now stands to lose the home.
The disgraced co-founder and former chairman of commercial office
building owner Max Capital Management was once the owner of Manhattan trophy
properties including the Helmsley Building at 230 Park Avenue, 237 Park Avenue and
450 West 33rd Street.
But things went downhill for the Upper East Side resident after he bought out the firm from
partner Richard Kalikow in 2002. Hochfelder resigned from his post at the company in 2004 amid increasing scrutiny from the DA’s office and numerous lawsuits.
In 2008, he was hit with a 58-charge indictment that accused him of stealing more than $17 million through a series of fraudulent loans from banks, friends, and family, and through a fictitious real estate venture over the five years following the buyout.
He was accused in a second indictment this February of stealing $2.5 million from investors for the purchase of the Sagamore Hotel on Lake George in upstate New York, and the Peaks Resort and Spa in Telluride, Colo., which he actually used to repay other creditors and go on spending sprees,
according to the DA’s office. He pleaded guilty in May.