Yonkers Islamic Center Inc. has sued a former treasurer to block him from using bankruptcy to evade paying $364,000 he allegedly stole from the mosque.
Byron B. Coleman of Newburgh filed for Chapter 7 bankruptcy protection on Sept. 12, declaring $315,375 in assets and $855,827 in liabilities.
YIC filed an adversary proceeding on Oct. 4 in U.S. Bankruptcy Court, White Plains, asking the court to declare that Coleman may not discharge his debt to the mosque because it was incurred as a result of embezzlement and fraud while acting in a fiduciary capacity.
YIC also accused Coleman of concealing drug and burglary convictions before he was appointed as treasurer.
If the mosque’s board of directors had known that Coleman was a convicted felon, the complaint states, “it never would have appointed him as either a director or treasurer of YIC.”
Coleman’s bankruptcy attorney, Michael O’Leary of Middletown, did not reply to an email asking for his client’s response to the allegations.
However, Coleman responded to similar allegations in 2018 when YIC sued him in Westchester Supreme Court to recover the funds. He claimed then that he withdrew the money from the mosque’s Chase bank account to safeguard it from the imam.
The dispute concerns a vacant lot on Warburton Avenue that YIC inherited in 1998 from a former member. It sold the lot in 2014 and deposited the $364,000 in a bank account.
In 2017, Chase notified Amam Adamu Morla Sulleimana, president of the mosque, that $360,000 had been withdrawn.
Adamu tried to stop the transfer but it was too late.
A review of bank records showed that Coleman had previously withdrawn another $4,800.
Coleman allegedly admitted to several members of the mosque that he was holding the money to keep it safe, according to the 2018 complaint, and asked YIC officers to join him in making investments in real estate.
A settlement was negotiated in 2019, according to a July 22 court ruling by Westchester Supreme Court Justice Charles D. Wood. But YIC contended that it got back only $95,802 and was still owed $192,230 of the funds in an escrow account.
Judge Wood ordered the parties to provide an accounting of the escrow funds at a Sept. 13 hearing. When Coleman filed the bankruptcy action on Sept. 12, the lawsuit was blocked from proceeding.
YIC is seeking $364,000 in the adversary proceeding. Coleman’s bankruptcy petition lists the debt as $100,000 and disputed.
His primary assets are his Newburgh house, valued at $285,000, and a 2016 Mercedes-Benz C300 valued at $15,830.
He values two row houses in Baltimore and Philadelphia owed by codebtor FiveSixty LLC at $449,000 but does not include them as assets.
His primary liabilities are business debts totalling nearly $411,000; his home mortgage, $209,890; and legal judgments totaling nearly $200,000.
He makes $8,190 a month as a social worker but his expenses exceed his income by $1,751 a month.
