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AG suit piles on Brooklyn developer accused of stealing deposits

Xi Hui “Steven” Wu stole $5M from immigrant families, lawsuits say

Attorney General of New York Letitia James and 345 Ovington Avenue in Brooklyn (Getty, Google Maps)
Attorney General of New York Letitia James and 345 Ovington Avenue in Brooklyn (Getty, Google Maps)

New York Attorney General Letitia James filed a lawsuit against a Brooklyn developer accused of stealing more than $5 million by fraudulently selling fake condos.

The attorney general on Wednesday announced the lawsuit against Xi Hui “Steven” Wu, accusing him of cheating at least 20 families of Chinese immigrants. The suit comes after affected families filed lawsuits of their own.

“Steven Wu took advantage of hardworking immigrants and sold them and their families a lie,” James said in a statement.

In 2013, Wu submitted an offering plan for a 25-unit condo building at 345 Ovington Avenue in Bay Ridge. The lawsuit says Wu failed to file required paperwork with the Department of Finance, though, meaning the building was never made a condo.

Despite the nonexistence of individual condo units, Wu “sold” condos to the families, who trusted him due to his role in the community. The suit says many signed single-page agreements for the supposed units and paid Wu for the condos that didn’t exist.

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Wu collected down payments, full payments and monthly payments for either a mortgage or common charges, according to the lawsuit. Since the condo didn’t exist, those payments were going directly to Wu for personal use, including loans against the building and construction costs.

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Wu’s attempts to avoid getting caught may have landed him in more trouble.The attorney general’s office said the developer submitted documentation regarding individual escrow accounts, but personally funded those and didn’t deposit purchasers’ additional down payments into the escrow accounts, as required by law.

Wu’s ex-wife, Xiao Rong Yang, is also accused in the scheme. There are a dozen other relief defendants who have a financial interest in the property, but aren’t accused of wrongdoing. The lawsuit aims to have the money returned to families and bar all of the defendants from offering or selling real estate in the state.

The victimized families have more pressing concerns. Wu’s lender started foreclosure proceedings at the property, threatening the residents with eviction. A group of purchases forced the building’s ownership into bankruptcy, temporarily staving off the foreclosure.

The AG’s office is involved in those proceedings.

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Bay RidgeCommercial Real EstateFraudLetitia JamesReal Estate Lawsuits