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Case of alleged extortion, with an upscale twist

Developer’s enforcers sought expensive watches, FBI says

By Shelley Murphy
Globe Staff / February 9, 2010

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It’s not your typical extortion case: A Boston real estate developer was charged yesterday with dispatching several enforcers to threaten a local realtor and his family over a $90,000 business debt.

The FBI alleges that the victim, who was suffering some financial difficulties, was threatened in the refined confines of the Bristol Lounge at The Four Seasons Hotel in Boston and stripped of his $5,000 Mont Blanc watch.

The alleged shakedown occurred Feb. 1, just feet from oblivious diners, but apparently under the watchful eyes of Boston police and FBI agents who launched an investigation after the victim earlier reported the threats.

David Gefke, 48, who is president and founder of First Capital Mortgage Group in Boston and East Springfield LLC, was arrested late Friday and brought into US District Court in shackles yesterday to face an extortion charge.

Appearing with him was Michael B. Lee, 29, an Irish national living in Dorchester who is charged with extortion for allegedly trying to collect the debt for Gefke.

A lawyer representing Gefke, of South Boston, declined to comment.

Lee’s attorney, Oscar Cruz Jr., said, “He maintains his innocence.’’

An FBI affidavit unsealed yesterday alleges that Gefke filed a lawsuit last month against the victim, identified only as John Doe, asserting that he owed him $90,000 for the 2007-2008 renovation of a condominium at 263 Commonwealth Ave. in Boston’s Back Bay.

The victim’s attorney negotiated an out-of-court settlement, but when the deal fell apart over an indemnification request, Gefke allegedly enlisted Lee and two other men to collect the money, the affidavit says.

Posing as Josh Wingenheimer, Lee arranged to meet the victim at his real estate office Jan. 29, purportedly because he was interested in purchasing Back Bay property for $1 million.

The affidavit says that Lee arrived at the victim’s office with two “thugs’’ and told him: “You owe an awful lot of money on the street. You owe Gefke and now you owe me.’’

Lee allegedly threatened the victim and his daughter and demanded $10,000 immediately and another $10,000 later.

The victim notified Boston police Detective Steven Blair, who began investigating the alleged extortion along with the FBI.

The victim contacted Gefke following the confrontation at his office and then, according to the FBI affidavit, received a text message from Lee saying, “You don’t owe him the money anymore; you owe me $58,000.’’

On Feb. 1, Lee allegedly sent a text message to the victim saying he was at the Bristol Lounge and demanded he join him.

When the victim arrived, Lee was upset because he had been unable to cash two checks that the victim had given him because of insufficient funds, according to the affidavit.

Lee forced the victim to give him his Mont Blanc watch, estimated to be worth about $5,000, and insisted he pay him $10,000 by that Friday, the affidavit says.

When the victim insisted he did not have the money, Lee allegedly told the victim to bring him his watch collection, which included a Rolex Presidential, a Rolex Yachtmaster, and a Breitling, the affidavit says.

During conversations that were secretly recorded by the FBI, the victim later asked Gefke, “Why did you send leg breakers to see me?’’

Gefke allegedly said that once the victim “pays the $56,000, it ends.’’

According to the FBI affidavit, Gefke told the victim he did not want it to go as far as it had, but he was “in a little bit of a jam’’ and someone else had sent Lee to Gefke “to get my issue cleared up.’’

Yesterday, Gefke shuffled into court wearing a gray T-shirt and navy running pants, as his wife sat in the front row, occasionally wiping away tears.

Lee, who was dressed in a red-hooded Nike sweatshirt and jeans, has been a familiar figure at the federal courthouse in Boston. He was charged last February in an unrelated federal case for wire fraud. He is awaiting trial in that case and had been free on bail when he was arrested on the new charge.

Lee was ordered last month to attend a drug treatment program as a condition of his bail.

US Magistrate Judge Timothy Hillman ordered Gefke and Lee held without bail pending a hearing Thursday for Lee and Friday for Gefke to determine whether they should remain jailed until their case is resolved.

Assistant US Attorney Laura Kaplan argued that both men would pose a danger to the community and that Lee was likely to flee.

Shelley Murphy can be reached at shmurphy@globe.com.