Federal prosecutors announced last week that they’ve charged a 50-year-old New Canaan man with securities fraud for his role in a real estate scheme. Eric Malley, founder and former chief executive officer of real estate private equity investment firm MG Capital Management L.P., also faces charges of wire fraud after inducing “hundreds of individuals to invest a total of more than $50 million in two real estate investment funds by, among other things, lying about his own prior experience and investment track record and about the nature and characteristics of those funds,” U.S. Department of Justice officials said in a press release. “Eric Malley allegedly promised his clients that they would reap the benefits of owning equity in Manhattan real estate through his time-tested, sophisticated, debt-free investment strategy,” Acting Manhattan U.S. Attorney Audrey Strauss said in the release. “As alleged, those promises were lies. Malley lied about his prior funds’ existence and performance, and he lied in promising clients that the funds were free of debt and leased to prominent corporate tenants. While his investors lost money, Malley enriched himself. We will continue to work with our law enforcement partners to protect investors from these types of deceptive practices.”
He will be presented before a magistrate judge in the Southern District of New York.