When convicted fraudster Joseph Makhani allegedly hatched a plan to steal a $2.2 million Harlem brownstone in 2012, the home was dilapidated, with a hole in the roof and an elderly owner who spent her days collecting cans on the street.
The owner, Veronica Palmer, might have been vulnerable personally, but Makhani enhanced his chances of snatching her stately three-story house at 107 West 118th St. with a cunning tactic common among property thieves, according to property and court records examined by The Post.
He sued himself, the documents show.
The 58-year-old accused scam artist, who was arrested and indicted by the state Attorney General in July on charges including mortgage fraud, falsifying business records and criminal possession of stolen property. Well versed in state courts and property battles, Makhani had his lawyer file paperwork claiming the rightful owner of the building went by the name Palmer Organization LLC.
But it was a business he’d created to echo the name of true owner Veronica Palmer, documents show.
He filed the paperwork with the city, which didn’t question it. The similarity of the two names was likely both confusing and potentially beneficial to Makhani, one expert told The Post.
“If someone doesn’t know what they’re looking for, it looks like Veronica Palmer just transferred the property to her [own] LLC,” said Brooklyn lawyer Toby Cohen, who has represented clients attempting to reclaim stolen properties.
An LLC, or limited liability company, doesn’t have to publicly identify its owners under New York law, and owners aren’t required to list their actual address, Cohen added.
“So there’s no guarantee that the members of ‘Palmer Organization LLC’ are Veronica Palmer,” he noted.
With that first step out of the way, Cohen said, “the scammer will then transfer the property from one shady LLC to another a bunch of times, and then start something called a ‘quiet title’ proceeding … which is where the final LLC sues everyone involved, including all the other LLCs that held title before it.”
The scheme is “rampant” in New York City, where property values have skyrocketed and there is little protection for homeowners against sophisticated real estate scammers, Cohen said.
“For every case we do know about, I’m sure there’s another few that we don’t,” he noted.
Court records reveal Makhani followed such a pattern. In 2014, another LLC he controlled called One 18 Street Corp. sued Veronica Palmer, the Palmer Organization and other companies connected to her townhouse in Manhattan Supreme Court, claiming it paid Palmer $10 to purchase the home, which had been built in 1900.
“Veronica Palmer probably got served with the [lawsuit] documents and had no idea what they were or didn’t know to call a lawyer, or didn’t have the money to litigate the case,” mused Cohen.
At the time no one bothered to track down the origins of the Palmer Organization.
If they had, they would have discovered that a longtime attorney for Mahkani, Steven Masef, created it. Masef, who died in 2018, listed his address as Makhani’s Queens office and claimed the Palmer Organization was at Palmer’s brownstone, according to the Palmer Organization’s incorporation papers.
In the end, Veronica Palmer never showed up in court to contest Makhani’s claims, nor did the Palmer Organization, according to court records. A judge issued an automatic win in favor of Makhani’s One 18 Street Corp. known as a default judgment, giving him a stranglehold on the property.
Getting the court’s blessing is considered a “gold standard” of ownership, Cohen said.
Once he had the townhouse, Makhani got a $650,000 construction line of credit, a $1.2 million mortgage loan, and renovated, converting the building to a multi-unit rental, raking in $3,000 to $3,400 per apartment each month, according to the Attorney General. The building, where one apartment boasts a private garden and another rooftop access, then ballooned in value, to more than $2 million.
Palmer, who had bought the stately home with a $50,000 mortgage in 1985, came home one day to find her front doors bolted shut. A neighbor told The Post he helped her cut them off.
Palmer disappeared after One 18 Street Corp won in court. She’s been living in a series of homeless shelters and hotels, said her sister Rhoda Sears, and could not be reached.
Sears, who lives in Maryland, lost touch with Palmer 15 years ago, learning of her homelessness through friends. She had no idea about the fate of her sister’s home when reached by The Post.
“I’ve been calling people trying to find her, but no one knows what’s happened to her,” she said.
Makhani, who lives in a sprawling home in Kings Point, NY, pleaded not guilty last month.
Leslie Nizin, an attorney representing Makhani, refused comment. “I’m not going to try the case in the media,” he said.