Jay Clayton, the United States Attorney for the Southern District of New York, along with Christopher G. Raia, Assistant Director in Charge of the FBI's New York Field Office, announced charges against Joshua Schuster. Schuster, a former real estate developer from New York City, faces allegations of defrauding investors in large real estate projects. He was arrested and is set to appear before the U.S. District Court for the Southern District of Florida. The case is assigned to Judge Valerie E. Caproni.
U.S. Attorney Jay Clayton stated: "As alleged, Joshua Schuster stole more than $10 million from his investors to fund his own lifestyle, pay off other investors in a Ponzi fashion, and maintain the appearance of success." He emphasized the commitment of his office to protect investors and markets from fraud.
FBI Assistant Director Christopher G. Raia commented: "Joshua Schuster allegedly stole more than ten million dollars from New York City real estate investors through inaccurate statements of fund usage and exaggerated portrayals of his business’s reputation." Raia highlighted that this scheme exploited investor trust to finance Schuster's lifestyle and cover personal debts.
The indictment alleges that between 2018 and 2022, Schuster used his Manhattan-based company Silverback Development to attract investments under false pretenses. Investors were promised equity in high-end developments across various locations including Gramercy Park and Long Island City. However, funds were reportedly misappropriated for personal expenses such as credit card payments and gambling losses.
Schuster is charged with one count each of wire fraud and securities fraud; both charges carry a maximum sentence of 20 years imprisonment if convicted.
Clayton acknowledged the efforts of the FBI and expressed gratitude towards the U.S. Securities and Exchange Commission for their parallel civil action against Schuster.
Assistant U.S. Attorney Daniel G. Nessim leads this prosecution under the Office’s Securities and Commodities Fraud Task Force.
