A Jericho attorney has been indicted for his role in a $4.6 million real estate fraud in which he is accused of fronting the same Suffolk properties to get loans from multiple sources, then using the money as his "slush fund," prosecutors said.

Robert Cassandro was arraigned Wednesday in  State Supreme Court in Manhattan on first-degree grand larceny and first-degree scheme to defraud.

The allegations are part of a larger Ponzi scheme that started in 2002, when Cassandro got family, lenders and others to invest in his single-family home construction, promising them each that they were the sole investors and that their loans were secured, according to prosecutors and court documents. Unbeknownst to investors, he netted more than necessary to pay for the projects and later told them he was going to "roll over" their funds into new building projects, court documents said.

Cassandro used the investment funds to pay the mortgage on his own home, country club dues and personal credit cards, prosecutors said.

Because the proceeds of the home sales could not cover all the loans from various sources, some investors got returns and others did not, prosecutors said.

"The defendant assured family members and others who had reason to trust him that this was a legitimate and safe lending opportunity, and now stands accused of violating that trust by using their money as his own slush fund," District Attorney Cyrus R. Vance Jr. said.

Cassandro pleaded not guilty and was released on a $50,000 bond put up by his father.

His attorneys, Peter Tomao, of Garden City, and Edward Mandery, of Mineola, said prosecutors have no evidence of a Ponzi scheme and fraud.

"Money went back to people," Tomao said. "He had a business in this period of time of obtaining properties and developing those properties. . . . People invested in it and after the real estate market changed, people lost money."

Cassandro lost money also, his attorneys said, and last year he filed for bankruptcy, which has tied up some of the properties.

"There's a difference between cheating and someone losing money in an investment," Mandery said. "There is no intent to defraud anybody."

Cassandro is due back in court May 9.

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