Sept. 21 (Bloomberg) -- Adam Hochfelder, the co-founder of the real estate investment company Max Capital Management Corp., who stole about $20 million from banks, friends and family members, was sentenced to as long as eight years in prison.
A sentence of two years eight months to eight years in prison was handed down yesterday by New York state Supreme Court Justice Michael Obus in Manhattan. Obus also ordered Hochfelder to pay $9.5 million in restitution. Hochfelder, 39, pleaded guilty in May to 15 counts of grand larceny and three counts of scheming to defraud over more than five years.
Hochfelder is a former chairman and chief executive officer of New York-based Max Capital, which he helped start in 1996 with Richard Kalikow. Max Capital’s properties included the Helmsley building at 230 Park Ave. in Manhattan.
Obus had promised Hochfelder a prison sentence of no more than four to 12 years when he pleaded guilty.
“I did not expect to deviate from that sentence,” the judge said in court yesterday. Obus said there was “more nuance” to the case than he expected, including that victims, many of whom are friends and family members, didn’t want Hochfelder to be punished severely and were concerned about being made whole.
“I’m not sure this is the right decision,” the judge said.
Manhattan District Attorney Cyrus Vance Jr. said Hochfelder misrepresented the value of his personal holdings and collateral to obtain millions of dollars in loans from a childhood friend, an uncle and two banks. He also got a family member to invest $1.3 million in a fictitious business, Vance’s office said in May, when it announced the plea.
“Hochfelder held himself out as a legitimate businessperson while systematically violating his victims’ trust,” Vance said yesterday in a statement. “In addition to prison time, we aggressively pursued restitution so that this defendant’s many victims can start to rebuild.”
Assistant District Attorney Gary Fishman had asked Obus to impose a sentence of four to 12 years. Marc Agnifilo, one of Hochfelder’s lawyers, asked the judge to sentence his client to two to six years behind bars. Hochfelder once had a “very severe” cocaine problem and bipolar disorder, Agnifilo told Obus.
“Not one day has gone by in the last several years that I have not felt great remorse and great regret for what I have done,” Hochfelder said yesterday in court. He said he had already paid back millions of dollars. “I will complete the payment to all of you,” he said.
In 2002, Hochfelder bought Kalikow out and went into partnership with Anthony Westreich, according to prosecutors. In 2004, the Westreich partnership dissolved.
Lauren Wachtler, another Hochfelder lawyer, said her client hadn’t used drugs since 2008. She said Hochfelder had been working for Heritage Realty in Manhattan and earned more than $250,000 a year.
The cases are People v. Hochfelder, 01979-2008 and 00050-2010, New York state Supreme Court (Manhattan).
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