Lender Charged With Grand Theft

Joel Burakoff, who allegedly ripped off fellow Friars Club members in a multimillion-dollar investment swindle, was charged Monday with eight counts of grand theft, authorities said.

Burakoff, 56, a former member of the prominent Beverly Hills social club’s board of directors, is accused of abusing his position to recruit wealthy victims who put money into Univest Home Loan Inc. The Gardena-based firm lured investors by promising to finance inner-city real estate and business loans, authorities said.

He faces nine years and eight months in prison if convicted on all charges. Burakoff is scheduled to surrender Jan. 10, said prosecutor Tom Wenke of the district attorney’s office’s major fraud division.

Victims include Irwin Shaeffer, a North Hollywood businessman and Friars Club president, plus several prominent entertainers and Friars Club members, including singer Tony Martin and his wife, the famed dancer and actress Cyd Charisse, authorities said. Most of the investors are affluent and have not been left destitute by their losses.

Neither Burakoff, of Woodland Hills, nor his attorney, George Buehler, could be reached for comment Monday.

“It’s a typical lender fraud scam,” said Wenke. “He would entice investors to invest in trust deeds, and when the loans were paid off, he did not repay the investors.

“It’s hard to say exactly where every dollar went--some of it may have gone to support his lifestyle, some of it may have been used to keep the business afloat. But it’s safe to say the investors did not receive one dollar back.”

The charges stem from allegations by nine Univest investors who lost a combined $506,500 between 1994 and early 1996. Wenke said the total amount of missing funds remains unknown, but investigators have determined that some investors lost money legitimately, and not due to swindling.

“There are more people who lost money than these nine, but we cannot say everyone lost money due to criminal means,” Wenke said. “As for these nine investors, we believe we have the evidence to prove it was criminal.”

Stanley H. Green, an attorney representing eight allegedly defrauded investors trying to recoup money from Univest’s court-appointed receiver, said he believes the charges filed against Burakoff “cover just a small part” of Burakoff’s alleged swindling scheme.

“I would say there are probably close to 100 people that have lost money in this,” Green said. “And not all of them were Friars Club members. Many were [Burakoff’s] longtime friends and associates--he attended some of my clients’ weddings. He was very close to them, and he abused their friendship.”

Univest was known in the lending trade as a “hard-money lender,” matching low-income borrowers desperate for loans with middle-class and rich investors seeking big returns. It catered to inner-city business and homeowners who were poor credit risks.

It made its money by charging borrowers high interest and commissions, and charging investors a monthly fee to service their loans. State Department of Real Estate records showed that, as of early 1995, the company had about 600 outstanding loans, with monthly collections of about $900,000.

Burakoff, the company’s treasurer and chairman, is the first Univest official to be charged since the investigation began in 1995 after several investors contacted authorities.

In a separate case, Kevin S. Merritt, a former Univest principal and Burakoff’s ex-business partner, faces 18 felony counts of grand theft and filing forged documents. Earlier this month, authorities issued a warrant for his arrest after Merritt failed to show up for a pretrial hearing in court.

Merritt and Burakoff were partners in Univest until 1991, when Merritt left the firm after his arrest. Burakoff continued operating the firm until last year, when it was placed under a court-appointed receivership.