Metro

Friend-on-friend swindles increase as economy flounders: Prosecutors

Maybe it’s the bad economy. Maybe it’s people’s desire to look past Wall Street and invest with someone they believe they can trust.

But whatever the reason, swindles of friends by friends are on the rise — so much so, that prosecutors have coined a separate name for it.

“We call these “Affinity frauds,” longtime Manhattan frauds prosecutor Micki Shulman told The Post, saying she’s seen an uptick in these pal-on-pal swindles as the economy continues to founder.

“It’s someone saying, ‘You can’t trust Wall Street, but you can trust me. I’m one of you — I’m from your church, I’m from your neighborhood, I’m from your same ethnic background,” said Shulman, deputy chief of the Manhattan DA’s Major Economic Crimes Bureau.

Shulman had just overseen the sentencing of the perfect case-in-point — Sharmon Wade, a high-living crook who was sent to prison today for swindling 15 friends out of $1 million.

Wade told his buddies — many of whom he knew since childhood, and attended church with — that he could double their money or more, if only they’d invest in his new real estate company.

Wade and co-defendant Claudius Hannah, who pleaded to the scheme in January and is awaiting sentencing, made sure call their company “Covenant Equity Group,” telling investors with oily piety they were all making a “covenant” with god.

“I don’t think this guy realized what he has done to our lives with his lies,” victim Valerie Johnson, of Manhattan, wrote the judge in asking Wade be sent to jail.

Victims like Johnson emptied their savings, took second mortgages out on their homes and ran up six-figure credit card bills because they believed in Wade.

Several lost their homes to the Ponzi scheme, assistant district attorney Vimi Bhatia told Manhattan Supreme Court Justice Michael Obus at today’s sentencing.

“These were good people,” Wade himself conceded at sentencing. “I knew them when they were kids.”

Meanwhile, Wade and Hannah lived and swindled lavishly throughout 2007 and 2008.

The pair operated out of a $12,000-a-month suite in the Helmsley Building. They took “business trips” to South Beach in Miami, flying out first class, booking opulent hotel rooms and tooling around in matching Corvettes.

They even threw a $100,000 office Christmas party at the Bryant Park Hotel — getting one victim to put the entire bash on her American Express card and promising her a great return on the “investment.”

The fact that Wade had spent most of the ’90s and the first half of the current decade in prison on drug and weapons convictions didn’t dissuade them — in fact, they were charmed that a violent felon had turned his life around.

Savvy people who would never dream of investing with a cold-call telephone huckster will hock their homes and ruin their credit for a “friend” with an honest face and a good idea, Shulman said.

Bernie Madoff ran the ultimate affinity fraud, in working his massive Ponzi scheme, letting victims believe they were part of an exclusive, “privileged” offering.

Other recent affinity frauds in the news include:

* Leigh Morse, former director of the Salander-O’Reilly art galleries, sentenced to yesterday for helping her boss, Larry Salander, in a $120 million fraud against trusting art clients, many of them Salander’s friends and colleagues for decades.

* Bogus Belgian blue-blood Guy De Chimay, sentenced in March to three years prison for a nearly $7 million Ponzi scheme plied against close friends and

* Francisco Alberto Gautreaux Calcano, who allegedly hit up fellow natives of the Dominican Republic — at times even impersonating Dominican Ambassador Roberto Saladin — for $15,0000 in donations to a bogus charity. Calcano faces up to seven years prison if convicted.

* Sweet-talking identical-twin securities fraudsters Makara and Tsele Nkhereanye, bogus brokers sentenced in October for rooking more than 40 investors out of $2 million, including trusted friends of a decade or more.

Suspected frauds can be reported to the DA’s office at its hotline, 212-335-8900.