Jason Grosfeld is the founder of Irongate, a Los Angeles firm that put itself on the map with the 1,500-acre Costa Palmas resort in Los Cabos, Mexico. Costa Palmas boasts that it provides ultimate luxury living in one of the most beautiful places on earth, building and selling homes branded by The Four Seasons and Aman. Grosfeld markets these homes and the access to the resort facilities that come with them to some of the world’s wealthiest people. Grosfeld has taken hundreds of millions of dollars from buyers in Costa Palmas based upon promises that the homes would be timely and safely built. Based on recent lawsuits, it appears that Grosfeld has orchestrated a scheme to take money from the wealthy that would make Robinhood proud. The only problem is, Grosfeld does not give that money to poor—Irongate allegedly pockets it for their own profit.
This scheme came to light months ago, when two buyers in Costa Palmas filed lawsuits against Irongate in California and we covered the fraud story here at Bust.com. In both cases, the plaintiffs allege that Irongate and Grosfeld made false promisesand took millions of dollars for homes that Irongate did not properly or timely build or deliver. GS 1975 LLC alleges it bought a $10 million home from Irongate that was supposed to be constructed by 2019. Four years later, after payments of $7 million, the home was not done. Irongate allegedly lied about the status and would not allow any inspection until GS1975 paid another $2 million. Upon inspection, the buyer discovered the home was not finished and was uninhabitable. When GS 1975 sued Irongate, Grosfeld forced it to sue in Mexico and took other steps to punish the buyer and deter complaints from others. Steve Anderson, a representative for GS 1975, says that after Irongate received almost $10 million, Irongate revoked his Beach Club membership, declared a contract default, and has put the house up for sale. By and through these tactics, Anderson believes that Irongate is trying to keep millions of dollars that GS1975 paid for the home and keep millions more in proceeds from the sale of the home to another buyer.
TRG CP LLC, another buyer in Costa Palmas, is facing similar ploys. TRG CP alleges that it has paid more than $9 million for a lot and construction of a home that Irongate promised to finish by 2021. To date, TRG CP has nothing to show for its money other than a concrete shell. According to Amit Raizada, a representative for TRG CP, Irongate made false promises and used strong arm tactics to force TRG CP to pay more money. And, when Raizada complained and filed suit, Irongate revoked his Beach Club membership, refused to work on the home, claims alleged contract defaults and is trying to force TRG CP to arbitrate in Mexico. As with GS 1975, Irongate and Grosfeld appear to be trying to keep the millions of dollars that TRG CP has paid to Irongate as well as millions of dollars in upside from the value of TRG CP’s property.
Both Anderson and Raizada advise that they will “fight the good fight” and do whatever it takes to protect their property from Grosfeld’s tactics. They have lawsuits pending in the US and in Mexico and are cooperating in criminal investigations involving Irongate, Grosfeld, and Costa Palmas. Raizada, through his company Spectrum Business Ventures, has extensive experience in these types of legal proceedings and will devote necessary resources to force Irongate to do what is right.