Wall Street Convict Tzolov’s Fifth Avenue Condo Sells for $2.92 Million

The New York condominium owned by former Credit Suisse Group AG (CSGN) broker Julian Tzolov, who admitted to conducting a $1 billion fraud, was sold for $2.92 million.

Andrew R. Heyer, chief executive officer of Manhattan private-equity firm Mistral Equity Partners, bought the property on Fifth Avenue, overlooking Madison Square Park, at a Nov. 17 auction, according to a court filing the next day. Heyer’s bid, $2.75 million, was the highest, according to the filing by Alan Nisselson, a lawyer for receiver David R. Maltz.

“The total consideration to be paid by the purchaser will exceed $3 million since it will include the bid price, a buyer’s premium and transfer taxes,” Nisselson wrote.

Before his trial was to begin in 2009, Tzolov, 38, a native of Bulgaria, fled the U.S. He was returned to New York from Spain in July of that year and pleaded guilty. He testified at the trial of his partner Eric Butler, 40, who was convicted.

Heyer didn’t immediately return a call for comment on the condo purchase.

The 1,591-square-foot, two-bedroom condominium comes with a “spa-like” master bathroom, 10-foot ceilings and “bright southern exposure with spectacular views of the skyline and Madison Square Park,” according to the listing on the auction company’s website. It’s also fully furnished.

Twenty Bidders

The auction had more than 20 registered bidders and the bidding started at $1.9 million, Richard Maltz, vice president of real-estate auctions at Maltz Auctions Inc. in Plainview, New York, on Long Island, said in a phone interview.

Tzolov bought the property in 2007 for $1.99 million, according to city property records.

Maltz said Tzolov put in about $250,000 in improvements such as motorized blinds and custom-built closets. The condo has an outstanding mortgage of about $1.7 million, he said.

Tzolov and Butler intentionally misled their institutional clients, including GlaxoSmithKline Plc and Roche Holding AG, about securities purchased on their behalf. Victims’ losses were more than $1.1 billion, according to the government.

Butler and Tzolov falsely claimed that the securities they put their clients in were backed by federally guaranteed student loans, according to prosecutors in the office of U.S. Attorney Loretta Lynch in Brooklyn.

The men told clients the investments, actually backed by riskier corporate debt and subprime mortgages, were a safe alternative to bank deposits or money-market funds, according to Lynch’s office.

Tzolov, who has been in custody since he was returned to the U.S., was sentenced to four years in prison. Butler got five years and entered prison Sept. 9.

U.S. District Judge Jack B. Weinstein appointed David Maltz in 2009 to sell Tzolov’s property.

The case is U.S. v. Tzolov, 08-cr-370, U.S. District Court, Eastern District of New York (Brooklyn).

To contact the reporter on this story: Thom Weidlich in Brooklyn, New York, federal court at tweidlich@bloomberg.net.

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net.

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