Good Afternoon
Good Afternoon
Long IslandNassau

Oyster Bay hit with third suit over disputed loan guarantees

The entrance to Oyster Bay Town Hall is

The entrance to Oyster Bay Town Hall is seen on March 28, 2014. Credit: Danielle Finkelstein

A third lawsuit seeking to force Oyster Bay to pay potentially millions of dollars for disputed loan guarantees has been filed in New York State Supreme Court.

The suit filed in Mineola on Tuesday by Phoenix Life Insurance, a subsidiary of Connecticut-based The Phoenix Companies, seeks unspecified damages. The suit alleges that Phoenix Life loaned $12.2 million to the company operating food concessions at town-owned Tobay Beach based on information provided by former Deputy Town Attorney Frederick Mei and Uniondale law firm Harris Beach that were misrepresentations.

In a written statement, the law firm said: “We acted openly and in accordance with the authority of the town attorney’s office and at no time did we have any indication that town officials acted beyond the scope of their authority.”

The loan was made to SRB Concessions Inc., a company formed by indicted restaurateur Harendra Singh. Oyster Bay officials have said the guarantees are invalid and unenforceable.

Singh was charged in federal court on Sept. 9 with 13 felony counts, including bribing an Oyster Bay official to obtain $20 million in loan guarantees. He has pleaded not guilty. Mei resigned on Aug. 31, 2015 and has not been charged.

The suit mirrors another filed by a Phoenix subsidiary in federal court on Tuesday against another company formed by Singh to operate concessions at the town-owned Woodlands catering hall.

The Phoenix suit in state court alleges that they are owed $9.9 million on the loan including principal and interest and other costs. Phoenix’s suit in federal court alleges it is owed $6.2 million.

In January another of Singh’s creditors, New York City-based Atalaya Asset Income Fund II LP, sued several of his companies as well as the town over guarantees for a defaulted $1.8 million loan that was supposed to finance food concession improvements at town-owned Tappen Beach.

In the Atalaya case, the town has alleged in court filings that signatures on loan guarantee documents purported to be those of Town Supervisor John Venditto and parks commissioner Frank Nocerino were forgeries.

Nassau top stories