Court Opinion

ID: 6197949
Source: CourtListenerOpinion
Date Created: 2022-02-05 20:26:45.667238+00
Date Added: 2024-06-11T08:56:15.255705
License: Public Domain

Memorandum. Judgment of conviction affirmed. Defendant was convicted upon its plea of guilty of violating six counts of section 352-c of the General Business Law. The indictment alleged that defendant had made false representations and statements in connection with the sale of interests in a condominium development.
Defendant’s contention on this appeal, in substance, is that its conceded conduct did not constitute a crime.
The purpose of the Martin Act (General Business Law, art 23-A) is to prevent frauds of all types in connection with the sale of securities and commodities, and it should be liberally construed to achieve such end (People v Lexington Sixty-First Assoc., 38 NY2d 588). We therefore cannot agree with defendant’s contention that the Attorney-General may only proceed civilly to remedy violations of section 352-e of the General Business Law, but cannot resort to criminal sanctions. When the Condominium Act was enacted (L 1964, ch 82), all units of a property covered by the act were specifically deemed to be co-operative interests in realty within the meaning of section 352-e of the General Business Law, thus evincing the intent of the Legislature to have condominiums regulated pursuant to the Martin Act. Although section 352 does not specifically mention co-operative interests in realty, section 352-j provides that all the provisions of the article are fully applicable to real estate syndication offerings and security transactions *771described in subdivision 1 of section 352-e. Consequently, the criminal sanctions contained in section 352-c cover false statements made in connection with condominium offerings.
Moreover, it should be noted that the Court of Appeals has stated that false or fraudulent representations in real estate syndication offerings are specifically made crimes under the General Business Law (Matter of Greenthal & Co. v Lefkowitz, 32 NY2d 457). Inasmuch as an offering for sale of condominium units is encompassed in the real estate syndication section (General Business Law, § 352-e), there can be no question that the making of a false statement in connection with a condominium offering is a crime.
Concur: Glickman, P. J., Gagliardi and Silberman, JJ.