A few extravagant structures have been constructed in Los Cabo’s East Cape, including Costa Palmas which is a luxurious resort that is owned and operated by Los Angeles real estate firm Irongate. Homes at Costa Palmas cost between $2.5 million and $25 million for oceanfront properties.
Interviews conducted with Jason Grosfeld, chief executive officer and founder of Irongate in 2021, revealed that the pandemic had an impact on the $1 billion worth of real estate transactions that took place in Costa Palmas. However, the majority of Costa Palmas residents charge Irongate as a reincarnation of Bernie Madoff and use the millions of euros it earns for luxurious homes in fraudulent Ponzi schemes to extort cash from buyers of homes to benefit Irongate.
Costa Palmas Brings Legal Action:
Sources say that criminal and civil legal actions have been filed in the past against Irongate as well as the Mexican subsidiary companies in Mexico for racketeering, fraud and extortion, conspiracy, and other offenses, or are currently in the process of being brought. Two Costa Palmas homebuyers have brought legal action against Irongate and a few agents of the company. American agents. Many authorities from Mexico as well as the US as well as other authorities could investigate the issue.
In the public documents this year, which they filed against Irongate in federal court of California Two homeowners from Costa Palmas, GS 1975 LLC and TRG CP, LLC claim Jason Grosfeld as the company’s CEO and founder, Michael Radovan, David Waller the chief of development, as well as Mitch Laufer, the corporate counsel, and others, of swindling homebuyers to give Irongate along with its affiliated companies millions of dollars to build.
These lawsuits assert that Irongate deceived customers by saying that homes would be constructed in 18 months, but later used the owners’ money or materials for other purposes or to build more houses. In both cases, the buyers claim that they have had to pay Irongate hundreds of thousands of dollars for homes that are currently being built and can’t be moved for many years.
The Lawsuits That Hurt Jason Grosfeld’s Online Reputation, According To The Claims:
Additionally, the claims state that these lawsuits in the lawsuits that Irongate or its employees threatened to declare default on contracts or stop construction work in the event that the debts owed weren’t paid, thus extorting thousands of dollars out of plaintiffs. In both cases, purchasers claim that when they attempted to defend themselves against the wrongdoing of Irongate, Irongate immediately retaliated against them by bribing other Irongate affiliates to end their memberships and subscriptions to the valuable Costa Palmas Beach & Yacht Club.
In response to Irongate’s request, the case was transferred into arbitration in Mexico According to state court records for GS 1975 LLC. Steve Anderson, a representative for GS 1975 LLC, claims that Irongate is the subject of arbitration hearings in Mexico. GS 1975 LLC is suing Irongate for more than $20 million in damages.
We reached out to TRG CP, LLC, but they did not respond. Jason Grosfeld father, James Grosfeld, was a well-known shareholder in the asset management company Black Rock, where he invested $94 million in shares in accordance with The Real Deal. James Grosfeld was PulteGroup’s chairman and CEO from 1974 until the time he removed himself from the board in response to an internal discord over Pulte’s corporate governance. Over the course of sixteen years, James Grosfeld served in both capacities.
Based on the number of homes Irongate sells throughout Costa Palmas and the more than $1 billion in sales that the company has made the homeowner complaints could be just the beginning.
Final Judgments in the Litigation
In order to receive payments of millions of dollars. suit claims that Irongate has made a number of false promises about the cost and timeline for the finalization of the property’s construction. In addition, it claims that after receiving around five million dollars from the plaintiff the property is now nothing more than a concrete shell.
These charges are similar to the ones GS 1975 LLC has imposed. Irongate claims to hold the house of the plaintiff hostage, and won’t repair it unless the plaintiff can pay millions of dollars more in costs as per the lawsuit. We tried contacting TRG CP, LLC staff for comments but did not receive a reply.
Our sources suggest that there could be a number of additional Costa Palmas home buyers with similar experiences or claims in addition to the fact that Irongate and its representatives could have to face legal action in the future. We’ve also heard that Mexican or American government officials from the federal level are studying the issue.
Source: Freep Sports 247