Father of “Property Wars” star pleads guilty to bank fraud
His NYC and Miami Beach condos are listed for sale
The battle is one step closer to coming to an end for the father of a “Property Wars” reality TV star.
Miami resident Joseph Menaged pleaded guilty to conspiracy to commit bank fraud in connection to his acquisitions of luxury condos in Miami Beach and New York City.
Menaged, father to Scott Menaged, who was among the cast members of Discovery Channel’s “Property Wars” show, was indicted last year on charges of bank fraud, transactional money laundering, conspiracy to commit bank fraud and a forfeiture allegation. With the exception of bank fraud, Joseph’s other charges will be dropped, according to a spokesperson for the Internal Revenue Service. Menaged will be sentenced to time served, according to the plea agreement.
The son, Scott Menaged, was sentenced in late 2017 to 17 years in prison for leading fraud schemes that defrauded investors of more than $30 million, and he had previously pleaded guilty to bank fraud, money laundering and aggravated identity theft.
On “Property Wars,” Scott was among six buyers who purchased houses at auctions in Phoenix with the goal of later flipping them for a profit. The show ran for two seasons in 2012 and 2013.
Prosecutors said that Scott and Joseph falsified tax forms and records to explain the transfer of nearly $11.5 million to Joseph from Scott.
Using fake and backdated records, Joseph, with the help of his longtime accountant Stephen Brown, obtained loans from BankUnited and Morgan Stanley to fund the purchases of three condos: unit 42C at One57, at 157 West 57th Street in Manhattan; and units 9D and 9C at the ultra-luxury Faena House at 3315 Collins Avenue in Miami Beach, according to the April 2019 indictment.
BankUnited provided a $2.3 million loan for the One57 unit, which Joseph Menaged purchased for $3.2 million, and another $1.3 million for unit 9D at Faena House, which he bought for $2.6 million. Morgan Stanley lent $3 million for the $5 million purchase of unit 9C. Menaged combined the two Faena House units.
Faena House was developed in 2015 by Alan Faena and backed by Ukrainian-born American billionaire Len Blavatnik. The two penthouse units sold to billionaire hedge funder Ken Griffin for a record $60 million, a deal that marked the peak of the Miami condo cycle.
Joseph Menaged entered into contracts to purchase his Faena House condos in the spring of 2013, nearly a year after signing a contract for his condo at One57 in New York.
Menaged’s combined unit at Faena House is currently listed for nearly $8 million with Pablo Alfaro and Oren Alexander of Douglas Elliman, according to Redfin. It hit the market in November as “the ONLY 3 Bedroom, 3.5 Bathroom residence at the iconic Faena House.”
His One57 condo is also for sale, asking $3.6 million, according to StreeEasy. Dudi Silberberg of the Level Group has the listing, which states that there’s a tenant in place who can stay or leave when it trades.
Before Menaged’s sentencing hearing, he’ll have to be current on any outstanding bank loans, fees and property taxes on his New York and Miami condos, according to Menaged’s plea agreement. It is also contingent on his accountant, Brown, accepting a deferred prosecution agreement. The charges against Brown have since been dismissed.