SEC v. Joshua Schuster; and Schuster Enterprises LLC (d/b/a Silverback), No. LR-26305, Southern District of New York (May 7, 2025) — Press Release
raw: Joshua Schuster; Schuster Enterprises LLC (d/b/a Silverback)
Joshua Schuster; Schuster Enterprises LLC (d/b/a Silverback), No. 1:25-cv-03800 (S.D.N.Y. May 7, 2025)
summary
Joshua Schuster and his firm, Schuster Enterprises LLC, were charged by the SEC for defrauding investors in a $6 million real estate raise and misappropriating over $2 million.
paragraph
The SEC charged Joshua Schuster and Schuster Enterprises LLC with defrauding investors during a $6 million capital raise for a Manhattan condominium project. The defendants allegedly misappropriated over $2 million to fund personal expenses, corporate costs, and other real estate ventures. They face charges for violating Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934.
narrative
The SEC has charged Joshua Schuster and his firm, Schuster Enterprises LLC (d/b/a Silverback), with defrauding investors during a $6 million capital raise for a Manhattan condominium development. While raising funds for the 'Second Avenue Project,' the defendants allegedly misappropriated over $2 million to cover personal benefits, general corporate expenses, and unrelated real estate projects. Additionally, the SEC alleges they misled investors by withholding material information regarding defaulted loans. The litigation, filed in the Southern District of New York, alleges violations of Section 17(a) of the Securities Act and Section 10(b) of the Securities Exchange Act. The SEC is seeking permanent injunctions, disgorgement with prejudgment interest, and civil penalties against both defendants. Furthermore, a conduct-based injunction is being sought specifically against Schuster.
Classified pre-ipo-fraud(confidence 80%). EDGAR detection: forms S-1/Form D/1-A· recall 72% / precision 8%. detection rule →
Parties
Securities Exchange CommissionSchuster Enterprises LLC (d/b/a Silverback)Joshua SchusterSchuster Enterprises LLC
Keywords
schustersilverbacksecjoshua schusterschuster enterprisessecurities exchangereal estateschuster schusterexchange commissionavenue projectschuster silverbacksecuritiesmillionjoshuaenterprises
Exhibits & Attached Documents (1)
Extracted insights
Dollar amounts 4
- $6.00M $6 Million $1M–$10M
- $6.00M $6 million $1M–$10M
- $2.00M $2 Million $1M–$10M
- $2.00M $2 million $1M–$10M
Entities 2
- agency Securities and Exchange Commission
- agency u.s. attorney's office for the southern district of new york and the fbi
Triples 8
- Securities And Exchange Commission charged Joshua Schuster and Schuster Enterprises LLC (d/b/a Silverback) with defrauding investors by raising $6 million and misappropriating over $2 million
- Joshua Schuster and Schuster Enterprises LLC (d/b/a Silverback) raised $6 million from at least three investors to develop the Second Avenue Project
- Joshua Schuster and Schuster Enterprises LLC (d/b/a Silverback) misappropriated over $2 million of investor funds for Schuster’s personal benefit, corporate expenses, and other real estate projects
- Joshua Schuster and Schuster Enterprises LLC (d/b/a Silverback) misled at least one investor by withholding material financial information including defaulting loans
- Securities And Exchange Commission seeks permanent injunctions, disgorgement with prejudgment interest, and civil penalties against Joshua Schuster and Schuster Enterprises LLC
- Securities And Exchange Commission seeks a conduct-based injunction against Joshua Schuster
- Securities And Exchange Commission violated Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5
- Securities And Exchange Commission received assistance from U.S. Attorney's Office for the Southern District of New York and the FBI
PDF (from attached: complaint)
Text layers
Extracted body text (2,405c)
U.S. SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 26305 / May 7, 2025 Securities and Exchange Commission v. Joshua Schuster and Schuster Enterprises LLC (d/b/a Silverback), No. 1:25-cv-03800 (S.D.N.Y filed May 7, 2025) SEC Charges Real Estate Firm and Its Principal with Misleading Investors in $6 Million Capital Raise and Misappropriating Over $2 Million On May 7, 2025, the Securities and Exchange Commission charged Joshua Schuster and his New York-based real estate development firm Schuster Enterprises LLC (d/b/a Silverback) with defrauding investors by raising $6 million to develop a high-end condominium real estate project in Manhattan (the “Second Avenue Project”) and misappropriating a significant amount of the proceeds. According to the SEC’s complaint, beginning in at least August 2018, Schuster and Silverback offered and sold membership interests in limited liability companies, raising more than $6 million from at least three investors to develop the Second Avenue Project. The SEC alleges that despite Schuster and Silverback’s representations that investor funds would be used to develop the Second Avenue Project, they misappropriated over $2 million of the funds to make payments for Schuster’s personal benefit, cover Silverback’s general corporate and payroll expenses, and fund other real estate projects they developed. According to the SEC’s complaint, Schuster and Silverback also misled at least one investor by withholding material financial information, including the existence of certain loans that were in default. The SEC’s complaint, filed in the U.S. District Court for the Southern District of New York, charges Silverback and Schuster with violating Section 17(a) of the Securities Act of 1933, and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The SEC seeks permanent injunctions, disgorgement with prejudgment interest, and civil penalties against both defendants. The SEC also seeks a conduct-based injunction against Schuster. The investigation was conducted by Zheng (Jane) He, Daphne Downes and Sandeep Satwalekar and supervised by Tejal D. Shah, and the litigation will be led by Elisa Solomon and Ms. He under the supervision of Alexander Vasilescu, all of the SEC’s New York Regional Office. The SEC appreciates the assistance of the U.S. Attorney's Office for the Southern District of New York and the FBI.
OCR text (2,405c · html-text · 99% conf)
U.S. SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 26305 / May 7, 2025 Securities and Exchange Commission v. Joshua Schuster and Schuster Enterprises LLC (d/b/a Silverback), No. 1:25-cv-03800 (S.D.N.Y filed May 7, 2025) SEC Charges Real Estate Firm and Its Principal with Misleading Investors in $6 Million Capital Raise and Misappropriating Over $2 Million On May 7, 2025, the Securities and Exchange Commission charged Joshua Schuster and his New York-based real estate development firm Schuster Enterprises LLC (d/b/a Silverback) with defrauding investors by raising $6 million to develop a high-end condominium real estate project in Manhattan (the “Second Avenue Project”) and misappropriating a significant amount of the proceeds. According to the SEC’s complaint, beginning in at least August 2018, Schuster and Silverback offered and sold membership interests in limited liability companies, raising more than $6 million from at least three investors to develop the Second Avenue Project. The SEC alleges that despite Schuster and Silverback’s representations that investor funds would be used to develop the Second Avenue Project, they misappropriated over $2 million of the funds to make payments for Schuster’s personal benefit, cover Silverback’s general corporate and payroll expenses, and fund other real estate projects they developed. According to the SEC’s complaint, Schuster and Silverback also misled at least one investor by withholding material financial information, including the existence of certain loans that were in default. The SEC’s complaint, filed in the U.S. District Court for the Southern District of New York, charges Silverback and Schuster with violating Section 17(a) of the Securities Act of 1933, and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The SEC seeks permanent injunctions, disgorgement with prejudgment interest, and civil penalties against both defendants. The SEC also seeks a conduct-based injunction against Schuster. The investigation was conducted by Zheng (Jane) He, Daphne Downes and Sandeep Satwalekar and supervised by Tejal D. Shah, and the litigation will be led by Elisa Solomon and Ms. He under the supervision of Alexander Vasilescu, all of the SEC’s New York Regional Office. The SEC appreciates the assistance of the U.S. Attorney's Office for the Southern District of New York and the FBI.