Florida Man Sentenced for Fraud in Mercer County

A Florida man who developed three Trenton affordable housing projects was sentenced to two years and three months in prison for making false statements to a financial institution to divert project money for personal and other unauthorized purposes, U.S. Attorney Paul J. Fishman announced on Wednesday.

Robert Kahan, 69, of Sunny Isles Beach, Florida, was also sentenced for purchasing items with the money made from committing this crime.

He previously pleaded guilty to two counts of an indictment charging him with making false statements in a loan application (Count 8) and to transacting in criminal proceeds that resulted from those false statements (Count 12).

He will also serve four years of supervised release and forfeit $989,901 in criminal proceeds.

Kahan was the developer of the Canal Plaza Homeownership Project, the Southwest Village II Project and the Catherine S. Graham Project housing projects in Trenton between 2006 and 2009, according to documents filed in the case and statements made in court. To complete these projects, he obtained both public and private funding.

The Southwest Village II Project was a project to construct 52 affordable housing units. Kahan diverted substantial portions of the project’s financing from a $6,435,000 construction loan from Roma Bank to his own personal use, his other development projects and other uses that were outside of the project budget.

In October 2008, Kahan diverted $343,354 of Southwest Village II project financing and applied it as a down payment to purchase a Florida condominium.

In numerous payment applications made to the loan administrator for the project financing requesting advances of loan and subsidy money, Kahan falsely stated that all money that he was previously paid had been used to pay costs for labor, materials and other obligations for the Southwest Village II Project.

Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford; IRS-Criminal Investigation, under the direction of Acting Special Agent in Charge Jonathan D. Larsen; and the U.S. Department of Housing and Urban Development, Office of Inspector General, under the direction of Christina Scaringi, Special Agent in Charge, Northeast Region, with the investigation leading to the sentencing.