A Rochester man is being accused of fraudulently diverting more than $300,000 intended for real estate investment to instead launch with his wife a line of gentleman’s grooming products.
Kevin T. Burns allegedly used $332,500 from a real estate fund — money invested by Daniel Braverman — for other purposes, including the founding of Gentleman Farmer, a company he co-owns with his wife, Maude.
The allegations were made in a complaint filed late last month in state Supreme Court of Monroe County by attorney Thomas Knab of Underberg & Kessler LLP on behalf of Braverman.
A Pittsford native now living in Florida, Braverman and two other family members were persuaded over the past decade to invest in real estate holding companies managed by Burns with the promise of financial gain.
Burns, KTB Holdings LLC and KTB Capital LLC are named as co-defendants in the complaint.
Burns had been a family friend for decades, previous lawsuits filed by Daniel Braverman, Jeffrey Braverman and Jacqueline Braverman contend. The trio filed confessions of judgment against Burns in July, claiming he and his LLCs failed to repay nearly $500,000 in investment funding as promised.
The latest filing accuses Burns of shifting money from a real estate fund purportedly created to buy properties in Rochester and instead using it for his personal business.
As the sole member and manager of KTB Holdings, Burns knew that the funds would not be used to acquire and develop real property, the complaint alleges, and that Burns would instead “use them for other purposes.”
The complainant is seeking repayment of his investment, interest and a punitive penalty.
“The aforesaid actions of (KTB) Holdings were gross, wanton, deliberate, evinced a reckless disregard for Daniel Braverman’s rights, and attained a high degree of moral culpability, and therefore justify an award of punitive damages against (KTB) Holdings,” the complaint says.
In December of 2020, Braverman had asked Burns for a listing of all properties owned by the investment fund, as well as the rent roll and financial standing on each.
Burns told Braverman that the fund had ownership in 22 and 26 Buena Place, 54 University Ave., 194-198 Charlotte St. and 15 Charlotte St., and that there were a total of 33 units, according to the complaint.
However, the complaints says that the listing of properties wasn’t factual.
“Contrary to Burns’ representations, the only real property ever owned by (the fund containing Braverman’s money) was 194-198 Charlotte Street,” the court filing alleges. The filing also says that property was purchased in 2017, before the investment by Daniel Braverman.
The complaint also contends that in both March of 2020 and March of 2021, Burns told all three Bravermans that scheduled distributions from the fund could not be made to investors due to the COVID-19 pandemic.
That March 2021 correspondence was the last communication Burns had with any of the Bravermans, the lawsuit says.
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