Days soon after a trustee accepted the $96 million sale of Michael Lichtenstein and Toby Moskovits’ Williamsburg Hotel, the property’s previous accountant is in very hot h2o.
A federal choose is keeping Daniel Norensberg and his Extensive Island-dependent accounting firm in contempt for failing to comply with subpoenas to make information and facts about the bankrupt hotel’s affairs. Norensberg has been requested to pay back $500 for each day until he complies.
A court docket-appointed trustee is in search of the information and facts as he investigates Lichtenstein and Moskovits’ money maneuvers at the posh hotel at 96 Wythe Avenue, which the developers place into personal bankruptcy in 2021 to fend off a foreclosure try by loan provider Benefit Avenue Companions.
The bankruptcy proceedings have undoubtedly been contemptuous.
The developers accused their lenders of a predatory endeavor to seize manage of the resort, though Advantage Road accused Lichtenstein and Moskovits of siphoning dollars from the venture.
Matters got uglier when the builders were being stripped of oversight of the resort right after an independent examiner alleged that “substantial amounts” of resort revenue was moved from the debtor entity into various accounts managed right or indirectly by Moskovits and Lichtenstein. The examiner additional alleged that the debtor did not file tax returns for 2017, 2018 or 2019 and submitted an unsigned return for 2020.
Lichtenstein maintained that any income transferred from the debtor entity went to paying the hotel’s bills and payroll.
The personal bankruptcy trustee, Stephen Grey, then zeroed in on Norensberg, who Gray alleges was the a single dependable for handling the tax returns involving 2017 and 2020. Grey has been trying to find to accumulate people returns, together with other economic info and all communications about the debtor’s affairs, assets, liabilities and transfers.
Norensberg unsuccessful to meet up with an Oct. 4 deadline to respond to the subpoena, court docket filings clearly show. Two times later, the trustee served a letter to Norensberg demanding compliance.
Much more than a thirty day period later on, on Nov. 16, Norensberg sent an electronic mail to the trustee’s attorneys suggesting he would comply. He was supplied with a file-sharing website link for the files, but never ever uploaded any.
In early December, Norensberg wrote in an e mail to the courtroom that he would “promptly upload the documents I have.” A day later on, he produced digital copies of the debtor’s federal and point out tax returns for the a long time in dilemma, but not other files sought by the trustee. Norensberg failed to demonstrate up to a courtroom listening to later on that month, foremost to the contempt prices.
“Norensberg’s failure to comply slows and impedes the Trustee’s investigation of the Debtor’s affairs, property, liabilities, and transfers, and it materially boosts the expenses of that investigation and impairs estate benefit,” Gray’s attorney wrote in a submitting.
Last week, the trustee chosen lodge operator Quadrum Global’s bid to purchase the 147-important assets in an auction. The sale is anticipated to close in March.
Norensberg did not return a request to remark. An legal professional for Lichtenstein and Mostkovits also did not return a ask for to remark.