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SEC alleges Bob Morgan is part of Ponzi scheme

May 22, 2019 11:28 PM

ROCHESTER, N.Y. (WHEC) -- Rochester's biggest real estate developer continues to face scrutiny after he pleaded not guilty to a slew of federal charges including money laundering and bank fraud.

Bob Morgan, CEO of Morgan Communities, is now facing civil charges from the U.S. Securities and Exchange Commission alleging he is part of a Ponzi scheme. 

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Federal prosecutors say Morgan defrauded banks, insurance companies and the government out of at least $25 million. Morgan owns more than 140 properties nationwide and dozens in the Rochester area.

Thousands of people throughout our area live in apartments owned by Morgan Communities. Nicole MacKenzie is one of them.

"Morgan Communities is huge," MacKenzie said. "If there is a trickle down, the impact is going to be huge."

Morgan is facing 46 counts of wire and bank fraud, money laundering, conspiracy and more.

Matthew lives in Penfield and he says the charges don't sit well with him.

"Honestly, it's just downright concerning," Matthew said. "This is the place where we're supposed to feel comfortable, you shouldn't have to worry about it being jeopardized."

The federal indictment specifically names ten apartment complexes owned by Morgan Communities in both Monroe and Ontario counties.

Avon Commons, Villas of Victor, Ellison Heights, Penbrooke Meadows, Union Square Apartments, Links at Centerpointe, Henrietta Highlands, Creek Hill Apartments, Hickory Hollows, and Knollwood Manor are listed as a part of the federal claim.

Federal prosecutors say Morgan and his co-defendants, including his son Todd, Broker Frank Giacobbe and finance director Michael Tremiti, falsified documents inflating the value of properties to get bigger loans from the bank.

So, should residents be concerned?

"As far as day-to-day operations, I don't believe there will be any impact at this point," J.P. Kennedy, Western District U.S. Attorney said. "There is really nothing for them to worry about at this point."

The Morgan Communities website says the company, among other values, prides itself on operating with integrity. 

"We signed a legal contract so I would hope and pray that if something were to trickle down, we'd have some sort of help somewhere," said resident Nicole MacKenzie. 

Read below for the SEC complaint in its entirety: 

SEC complaint against Bob Morgan by News10NBC on Scribd

Credits

Kaci Jones

Copyright 2019 - WHEC-TV, LLC A Hubbard Broadcasting Company

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