Housing fraud case in Miami pits former partners against each other

Two decades ago, lawyer Bruce Greer and developer Lloyd Boggio launched a Miami business that would become the largest builder of low-income housing in Florida.

With Boggio at the helm as CEO, Greer invested millions of his family’s wealth into the venture and started grooming his Columbia University-educated son, Matthew Greer, to take over the reins of Carlisle Development Group.

Bruce Greer and his wife, Evelyn — a highly regarded lawyer like her husband and former mayor of Pinecrest — gave their son $2.3 million in 2007 to buy out Boggio’s stake in Carlisle, retaining him as a consultant.

Today, however, the once-close relationship between the Greer family and Boggio is in tatters — torn apart by criminal allegations that their former business partner, working with their own son, inflated the cost of apartment projects to qualify for excessive federal funds and then divvy up kickbacks from their general contractor.

Matthew Greer, 38, pleaded guilty last September to conspiring to steal tens of millions of dollars in tax credits and grants from the U.S. government to build affordable housing in Miami and other areas of Florida. Greer, who faces up to 10 years in prison, repaid $16 million under a plea agreement that came with a previously undisclosed provision that now shapes up as the key to Boggio’s defense strategy for his federal trial in August.

It’s a side agreement with prosecutors that provides criminal immunity for Matthew Greer’s prominent parents.

In a newly filed motion, Boggio’s attorneys revealed the deal and signaled they will attempt to put the elder Greers on trial, digging into the behind-the-scenes roles they played in Carlisle’s operations and development deals. One “critical component” of the defense is that the 70-year-old Boggio contends he relied on the Greers’ legal advice to divvy up leftover construction funds from housing projects — an illegal diversion of cash that is the crux of the criminal case against him and Matthew Greer.

Boggio’s lawyers — Ed Shohat and Scott Srebnick — also argue that the prosecution’s star witness would be biased against him by the desire to protect his parents. “Obviously, Matthew Greer, being the primary conduit of information to his parents, was sufficiently concerned about their exposure to insist on immunity for them as a condition of his cooperation,” they say in court papers.

But the defense attorneys for the elder Greers said in a statement that the parents were not investigated by the U.S. attorney’s office in the Carlisle case and never faced potential criminal charges.

“Our clients were advised, both before and after Matthew’s plea agreement, that they were not under investigation, and they did not request immunity,” said the statement, issued by Miami attorneys Matthew Menchel and Adriana Riviere-Badell.

The immunity request was made by the son’s high-profile defense attorney, Roy Black, who declined to comment.

Greer, who is seeking to reduce his potential sentence, will be the prosecution’s main witness against his former mentor, Boggio, the only defendant among seven in the Carlisle case who opted for trial. Boggio backed out of an expected plea deal last September during a federal court hearing.

On Monday, Boggio is hoping U.S. District Judge Ursula Ungaro will throw out his indictment at a hearing in Miami federal court, based on claims that the charges of conspiracy, theft and fraud are legally flawed.

In court documents, Boggio’s defense attorneys assert that Matthew Greer’s parents both played crucial roles in the son’s housing development company — investing in, reviewing documents and advising him as well as Boggio on many of their low-income apartment projects subsidized by the federal government.

In the filings, they argue that the “parents’ knowledge and lack of objection to this process” of distributing excess construction funds was “relevant to Boggio’s state of mind about whether he was committing a crime.”

In addition to being attorneys, the elder Greer parents also boast stellar political and social résumés. Bruce Greer was once nominated as a federal judge and is president of the Fairchild Tropical Botanic Garden board of trustees. Evelyn Greer is a longtime real estate investor, who was once a partner in a top criminal defense firm. She is a former Miami-Dade School Board member and former Pinecrest mayor.

Shohat and Srebnick, who declined to comment for this story, disclosed the immunity provision in April as they sought to use subpoenas to obtain emails and other documents from Bruce and Evelyn Greer as well as the son’s former company, Carlisle.

The provision was outlined in a brief letter from prosecutor Michael Sherwin to Black last September: “As related to plea negotiations between your client Matthew Greer and the United States, this correspondence memorializes what I personally represented to you on June 16, 2015: ‘As related to this criminal scheme, we [the U.S. attorney’s office in South Florida] would not seek criminal charges against his parents, Bruce Greer and Evelyn Greer.’ ”

Presuming he is called as the chief witness at Boggio’s trial, Matthew Greer is required to tell the truth about his criminal activity under his agreement with the prosecutors, Sherwin and Michael Berger. But whatever Greer might testify about his parents’ involvement cannot be used against them, according to the immunity deal.

Some defense attorneys say such immunity deals are not unusual in the federal justice system. Some defendants in white-collar criminal cases — such as husbands accused of tax evasion — obtain protection for their spouses as part of their plea agreements, for example. But others say the Greer side deal is highly unusual because it provides “transactional immunity,” which completely bars any prosecution.

Depending on the leeway Judge Ungaro grants Boggio’s defense team, the elder Greers could face lengthy grilling about their roles in the company should they testify.

“If it’s relevant, there is nothing to preclude Ed Shohat from asking the son about the parents’ involvement or from asking the parents about their involvement,” said prominent South Florida defense attorney Jon Sale, a former prosecutor in the U.S. attorney’s offices in Miami and New York.

Matthew Greer’s goal is to see his eventual prison sentence reduced by as much as half, based on his testimony against Boggio and his repayment of $16 million in stolen funds from the U.S. government.

The younger Greer joined Carlisle in 2004. Thanks to his parents’ financial backing, he bought out Boggio’s interest in the company three years later. In 2008, Greer replaced him as CEO, but Boggio retained profit interests in several of Carlisle’s projects that were still in the pipeline.

Boggio, in an industry trade magazine, Apartment Finance Today, said he thought Greer, with two degrees from Columbia and a stint on Wall Street, would be a short-timer “until he found other worlds to conquer — but it got to the point where he kind of got the bug.”

“The biggest thing he’s done is really change the culture of the company,” Boggio said in July 2008. “I’m very much a legal pad and ballpoint pen kind of fly-by-the-seat-of-your-pants kind of guy, and Matt’s much more a product of the 21st century.”

Prosecutors, in court documents, paint a more sinister picture. They say Greer and Boggio conspired with former development partners, Biscayne Housing Group’s co-founders Michael Cox and Gonzalo DeRamon — with whom they had previously battled in civil litigation — as well as with Fort Lauderdale contractor Michael Runyan and Plantation contractor Rene Sierra. Collectively, the developers stole about $36 million in federal housing subsidies by inflating construction costs and receiving kickbacks. The contractors, who paid the kickbacks, kept a portion of that money, too.

Cox, DeRamon, Runyan and Sierra already pleaded guilty to conspiracy charges and are also cooperating witnesses.

In total, prosecutors say, Greer, Boggio and the other defendants plundered U.S. tax credits to line their pockets from 14 government-subsidized projects built for the poor in Miami-Dade County. All but one were built in the Brownsville, Little Haiti and Overtown neighborhoods between 2007 and 2012.

Prosecutors say Greer and Boggio set up shell companies with the names of Marquesas Capital and Caesar and Cleopatra Investments to collect the illicit payments secretly.

This story was originally published May 21, 2016 at 9:00 AM with the headline "Housing fraud case in Miami pits former partners against each other."