When convicted fraudster Joseph Makhani allegedly hatched a plan to steal a $ 2.2 million Harlem brownstone in 2012, the house was dilapidated, with a hole in the roof and an elderly homeowner who spent her days picking up cans in the street.
Owner Veronica Palmer may have been personally vulnerable, but Makhani has increased her chances of taking over her stately three-story home at 107 West 118th St. with a cunning tactic common among property thieves, records show. property and court reviewed by The Post. .
He sued himself, according to the documents.
The 58-year-old accused con artist, who was arrested and indicted by the state attorney general in July on charges of mortgage fraud, falsification of business records and criminal possession of stolen property. Well versed in state courts and real estate battles, Makhani had attorney file documents claiming that the building’s rightful owner was called Palmer Organization LLC.
But it was a business he had created to echo the name of real owner Veronica Palmer, according to documents.
He deposited the papers with the city, which did not question them. The similarity of the two names was likely both confusing and potentially beneficial to Makhani, an expert told the Post.
“If anyone doesn’t know what they’re looking for, it looks like Veronica Palmer just transferred ownership to them [own] LLC, ”said Brooklyn attorney Toby Cohen, who has represented clients attempting to recover stolen property.
An LLC, or a limited liability company, does not have to publicly identify its owners under New York law, and owners are not required to provide their actual address, Cohen added.
“So there is no guarantee that the members of ‘Palmer Organization LLC’ are Veronica Palmer,” he noted.
With that first step out of the way, Cohen said, “The scammer will then transfer ownership of one shady LLC to another several times, then initiate something called a ‘secret title’ proceeding… that’s where the final LLC sues everyone involved, including all other LLCs who held title before it.
The program is “rampant” in New York City, where property values have skyrocketed and homeowners have little protection from sophisticated real estate crooks, Cohen said.
“For every case that we know of, I am sure there are others that we do not know,” he noted.
Court records reveal that Makhani followed such a pattern. In 2014, another LLC he controlled, One 18 Street Corp., sued Veronica Palmer, the Palmer Organization and other companies related to his townhouse in the Manhattan Supreme Court, claiming it paid 10 $ to Palmer to buy the house, which was built in 1900.
“Veronica Palmer was probably served with the [lawsuit] documents and had no idea what they were or didn’t know to call a lawyer, or didn’t have the money to argue the case, ”Cohen said.
At the time, no one bothered to trace the origins of the Palmer Organization.
If they had done so, they would have discovered that a longtime Mahkani lawyer, Steven Masef, had created it. Masef, who died in 2018, said his address was of Makhani’s office in Queens and claimed the Palmer organization was located at Palmer Brownstone, according to the Palmer organization’s incorporation documents.
In the end, Veronica Palmer never showed up in court to dispute Makhani’s claims, nor did the Palmer Organization, according to court records. A judge ruled an automatic gain in favor of One 18 Street Corp. of Makhani, known as Default Judgment, giving him control over the property.
Getting the blessing from the court is considered a “gold standard” of property, Cohen said.
Once he got the townhouse, Makhani secured a $ 650,000 construction line of credit, a $ 1.2 million mortgage and remodeled, converting the building into a multi-unit rental, earning between $ 3,000 and $ 3,400 per apartment each month, according to the attorney general. The apartment building, where an apartment has a private garden and another access to the roof, then exploded in value to over $ 2 million.
Palmer, who had bought the stately home with a $ 50,000 mortgage in 1985, returned home one day and found her front doors locked. A neighbor told The Post he helped her cut them off.
Palmer disappeared after One 18 Street Corp won in court. She has lived in a series of shelters and homeless hotels, her sister Rhoda Sears said, and could not be reached.
Sears, who lives in Maryland, lost contact with Palmer 15 years ago, learning she was homeless through friends. She had no idea of the fate of her sister’s house when contacted by The Post.
“I called people who were trying to find her, but no one knows what happened to her,” she said.
Makhani, who lives in a sprawling house in Kings Point, NY, pleaded not guilty last month.
Leslie Nizin, a lawyer representing Makhani, declined to comment. “I am not going to try the case in the media,” he said.