Lawsuits pile up in Las Vegas real estate investment scam

By Steve Green (contact)

Sunday, Aug. 2, 2009 | 2:54 p.m.

Jean Marc El Jwaidi

Investor lawsuits are piling up against a Las Vegas man who was arrested last week in what investigators are calling a massive real estate investment scam involving dozens of victims worldwide.

But investors and other creditors hoping to recover anything from the suspect, Jean Marc El Jwaidi, may have to line up in bankruptcy court.

That's because one of El Jwaidi's companies, Babuski LLC, filed for Chapter 11 bankruptcy reorganization in Las Vegas on June 29 -- just weeks before his arrest.

Court records show the company filed for bankruptcy in order to block foreclosure proceedings by creditor Vestin Mortgage involving land Babuski said it is developing at Russell Road and the 215 Beltway.

The bankruptcy filing listed $10 million to $50 million in both estimated assets and estimated liabilities.

Investigators, including officers from the Nevada Secretary of State's Securities Enforcement Division, arrested El Jwaidi at McCarran International Airport on Wednesday. Investigators said they had been tipped he would be arriving on a flight from London.

The Secretary of State's office said an arrest warrant for El Jwaidi was issued May 14, the same day he was accused in a criminal complaint of bilking a vulnerable Las Vegas senior citizen out of $400,000.

Investigators in June executed a search warrant on El Jwaidi's office at 8820 W. Russell Road, Suites 100 and 105.

"Evidence seized there and information that poured in from the public will likely lead to additional charges, including securities fraud, obtaining money under false pretenses and racketeering,'' the Secretary of State's office said.

One thing investigators and creditors may have to grapple with are various identities El Jwaidi has done business under.

State records indicate El Jwaidi is also the manager of JKG Property Management & Development LLC, 9510 W. Sahara Ave., Suite 200.

His name is spelled "Jamal Eljwaidi'' in records for that company.

State records also refer to him as "Jean Marc.'' One lawsuit says he is known as "Jean Marc El Jwaidi,'' "Jean Marc Eljwaidi,'' "Jamal Eljwaidi'' and "Jamal El Jwaidi.''

Babuski's bankruptcy filing spells his last name two ways: "El Jawaidi'' and "El Jwaidi.''

Investigators with the Secretary of State's office say El Jwaidi told the elderly alleged victim that the two of them would be equal partners in a commercial real estate investment, and then proceeded to collect more than $400,000 in multiple payments from the alleged victim. El Jwaidi used the money to live a lavish lifestyle, while leaving his victim virtually destitute, the state agency said.

El Jwaidi denies the allegations, his company Babuski said in its bankruptcy court filing.

Clark County District Court records show El Jwaidi and his companies are defendants in multiple lawsuits filed by investors and others -- some now listed as creditors in the bankruptcy filing.

The latest suit was filed Wednesday by Housecap Financial LLC and California resident Walid Jawdeh.

They allege that between February 2008 and last month, they loaned Babuski $2.5 million for development of "PG Plaza'' on 12.5 acres Babuski owns at the Russell Road/215 Beltway property.

The suit says the $2.5 million was sent to the accounts of El Jwaidi, Babuski and two other defendants: an individual residing in Clark County named Bilal El Joueidi; and another El Jwaidi company called JKG Development LLC.

El Jwaidi personally guaranteed $1 million of the funds loaned for PG Plaza, but Babuski and El Jwaidi have failed to repay any of the $2.5 million, the suit charges.

El Jwaidi "intentionally and fraudulently misrepresented to Housecap that he had already secured funding which would used to develop PG Plaza and repay Housecap's loan,'' the suit alleges.

The defendant has not yet responded to that lawsuit and couldn't be reached for comment on the allegations Friday.