Two real estate developers who invested in numerous properties in downtown Wichita a decade ago have now been charged with 61 felony counts of committing securities fraud and selling unregistered securities.
Kansas Securities Commissioner Josh Ney announced criminal charges against Michael Elzufon and David Lundberg in Sedgwick County District Court.
The criminal complaint alleges the two committed securities fraud by offering and selling unregistered promissory notes and investment offers in various businesses, including redevelopment projects in Wichita. The alleged scheme has affected at least one Kansan and 59 residents from other states, while the alleged victim losses currently total over $3.5 million, according to a release from the state of Kansas.
Elzufon and Lundberg invested millions of mostly borrowed money in downtown revitalization projects starting in 2004. Many of their past real estate acquisitions have since been auctioned off, or are under the control of various banks.
Ney urges anyone with information regarding any promissory note or other investment offered by Elzufon or Lundberg to contact the Office of the Kansas Securities Commissioner.