Harvard Business Graduate Charged With Investment Fraud

A real estate developer who graduated from Harvard Business School was accused of defrauding mortgage lenders in a Brooklyn, New York, property scheme.

Schelton Assoumou, owner of Brooklyn Renaissance Development Inc., is charged with bank and wire fraud, according to documents unsealed today in federal court in Brooklyn.

Prosecutors allege that Assoumou, a 2005 Harvard Business School graduate, engaged in the scheme from June 2008 to June 2012. The defendant asked graduates of the school and others to invest in Brooklyn properties and prepared fraudulent loan documents for the transactions, according to the criminal complaint unsealed today.

Assoumou told investors that he would manage the properties, recruit tenants and make mortgage payments on their behalf, according to the complaint. Assoumou made only a few payments and the properties quickly fell into default, the government said.

“The investigation to date has revealed no evidence that the defendant made anything other than token efforts to manage the properties and recruit financially viable tenants,” prosecutors said in the complaint.

Loans at issue for three Brooklyn properties totaled more than $2.1 million, according to the complaint. A lawyer for Assoumou couldn’t immediately be reached for comment.

The case is U.S. v. Assoumou, 1:13-mj-00022, U.S. District Court, Eastern District of New York (Brooklyn).

To contact the reporter on this story: Christie Smythe in New York at csmythe1@bloomberg.net

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

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