Josh Schuster To Plead Guilty To Ponzi Scheme

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Nine months after he was charged with stealing more than $10 million from investors, disgraced developer Josh Schuster has changed tack and will now plead guilty to the charges. He faces up to 20 years in prison.

Prosecutors from the U.S. Attorney’s Southern District of New York informed the District Judge Valerie Caproni earlier this month that Schuster intends to change the not-guilty plea he entered in May when he was charged with securities fraud.

“The Government understands that the defendant wishes to change his plea and enter a guilty plea to Count Two of the Indictment,” U.S. Attorney Jay Clayton wrote.

A change-of-plea proceeding is scheduled for Friday.

Schuster’s attorney did not respond to a request for comment.

It’s not clear why the 42-year-old decided to change his position. He switched attorneys in September.

Schuster was arrested last May in Florida, where he had relocated after his real estate company Silverback Development fell apart.

The Real Deal first uncovered allegations in 2021 that Schuster’s investors suspected he was misappropriating funds and had removed him from projects. Afterward, Schuster moved to Boca Raton, where he attempted to reinvent himself as a solar projects developer.

But in May the U.S. attorney’s office charged him with wire and securities fraud, outlining a $10 million Ponzi-like scheme through which Schuster allegedly promised investors stakes in projects in Gramercy Park, Long Island City and the Bronx, but instead used the money to pay off earlier investors and fund his credit card and gambling debts.

Schuster appeared in Manhattan court in May alongside his wife to enter his not-guilty plea. He’s been out on a $2 million bond.

The Securities and Exchange Commission also has a case against Schuster, in which it seeks to claw back the money he took in from his alleged scam. The case is ongoing.