Former Belleville mall owner convicted of fraud wants to delay prison sentence
Jonathan Larmore, former owner of Belleville Crossing’s main strip mall, was supposed to surrender to federal authorities on May 19 and begin serving a five-year prison sentence for fraud.
But that didn’t happen.
Three days earlier, a U.S. appellate court judge agreed to issue a stay on Larmore’s surrender date until a three-judge panel decides whether he can remain free on bond while his case is appealed. The panel is set to hear arguments on Friday in New York City.
“The (government’s) case was based on circumstantial evidence,” said attorney Richard Asche, who formerly represented Larmore at his trial in U.S. District Court for the Southern District of New York last fall.
“The prosecutor sought to make inferences from this circumstantial evidence, and the issue really was, ‘Were those inferences appropriate?’”
Prosecutors had accused Larmore of using a “sham company” to falsely announce a $77 million tender offer for WeWork stock as part of a scheme to lure a rush of investors, artificially inflating its value and potentially making him millions of dollars. WeWork is a business that provides shared office space.
A timing error caused Larmore to actually lose about $775,000 in the scheme, according to prosecutors.
A jury found Larmore guilty of tender-offer and securities fraud, both felonies punishable by up to 20 years in prison. District Judge Paul Engelmayer sentenced him to five years in March and ordered him to surrender on May 19.
“In addition to the prison term, Larmore, 51, of Syracuse, Indiana, was sentenced to three years of supervised release during which the defendant must perform 500 hours of community service,” stated a news release from the office of Matthew Podolsky, acting U.S. attorney.
On April 1, Larmore filed a notice of appeal to the U.S. Court of Appeals for the Second Circuit.
In a separate case, the U.S. Securities and Exchange Commission has charged Larmore with allegedly violating anti-fraud provisions in federal law involving the WeWork tender offer and his real-estate business.
Belleville Crossing investors had accused Larmore of misappropriating millions of dollars into a “personal slush fund” to pay for everything from a private jet, yacht and other “toys” to expensive residences and six-figure parties, including one to celebrate the family dog’s birthday.
Asche said he isn’t representing Larmore in the New York appeal, noting that defendants are generally advised to start fresh with a new legal team, so they haven’t talked recently.
“I can only imagine how he’s doing,” Asche said. “He has a 1-year-old child, and by all accounts, he is an extremely hands-on father, so I’m sure that he’s not very happy. Nobody who goes to jail is happy. But he’s an optimist, I guess, and he probably thinks he’ll win on appeal.”
Larmore couldn’t be reached for comment this week.
Larmore is being represented in the appeal by Brad Bondi, brother of U.S. Attorney General Pam Bondi. Brad Bondi is based in Washington, D.C. He didn’t respond to a request for comment.
Neglect and mismanagement
Belleville Crossing is a 50-acre shopping center, off Illinois 15. It includes a main strip mall with PetSmart, Great Clips and T-Mobile, as well as a Target store, The Home Depot, smaller strip malls and freestanding businesses.
Larmore became known to Belleville residents as owner of the main strip mall and two smaller strip malls, including one with the former Buffalo Wild Wings restaurant, beginning in 2011. They were part of his Arciterra Companies umbrella of about 80 developments all over the country.
By early 2023, several tenants had moved out of the Belleville strip malls amid complaints of neglect and mismanagement. Problems ranged from tall weeds to potholes, leaky ceilings to broken lights.
A judge in U.S. District Court for the Western District of Louisiana appointed a receiver due to defaults on bank loans.
Belleville Crossing investors filed a civil lawsuit in U.S. District Court for the Southern District of Illinois against Larmore, family members and Architerra executives, accusing them of misappropriating more than $35 million. The lawsuit was dropped in late 2023, around the same time the SEC brought charges.
“(Larmore used misappropriated funds) to pay for other cash needs of his businesses, and to fund his lavish lifestyle,” stated the SEC complaint, filed in U.S. District Court for the District of Arizona.
Timber Belleville Properties, which is part of Florida-based Timber Development Corp., bought Belleville Crossing’s main strip mall for $6.5 million in February through the receiver, giving city officials hope for a brighter future.
The SEC lawsuit lists Larmore’s wife, Michelle Larmore, and mother, Marcia Larmore, as “relief defendants,” meaning they allegedly hold assets resulting from illegal activity.
Michelle Larmore filed for legal separation from Jonathan Larmore in 2023 in Maricopa County Superior Court in Phoenix, Arizona. Court records show they have one child, a daughter. That case is ongoing.
Jonathan Larmore has lived in Indiana, Arizona and Florida. He told Judge Engelmayer that he earned a business degree at Indiana University and had never been treated for mental illness, according to a transcript of his March 19, 2024, arraignment on the New York charges.
When asked about drug or alcohol problems, Larmore answered, “I voluntarily (went in 2022) into a place called Passages in Los Angeles, where you kind of reboot yourself.”
Larmore got permission to attend a May 2024 court hearing by telephone after Seth Waxman, his attorney before Asche, stated in a filing that travel from Florida to New York was cost-prohibitive due to his “financial predicament.”
Waxman noted that the SEC charges had resulted in most of Larmore’s assets being frozen and that the limited funds available for him to spend were going toward living expenses and legal fees.
“In addition, Mr. Larmore’s baby (with his fiancee) was born on April 20, 2024, imposing new parental duties on him,” Waxman wrote.
Arrested in predawn raid
Law-enforcement officers arrested Larmore on the New York charges on March 14, 2024, at his home in Punta Gorda, Florida, court documents show.
The sprawling three-story home surrounded by palm trees had been purchased in 2018 by a limited-liability company called 751 W Retta Esplanade FL LLC, according to Charlotte County property records. The $1.2 million cost included two buildings with residential space, now valued at $1.6 million.
Waxman described dramatic details of the arrest in a May 2024 filing as part of his argument that records from Larmore’s seized cellphone should be suppressed. He stated that:
- A large contingent of law-enforcement officers showed up at the home for a “predawn action.”
- Officers used a bullhorn to order Larmore to come outside, and he complied.
- Numerous officers had firearms pointed at him.
- Larmore was handcuffed and placed under arrest, allegedly without being read his Miranda rights.
An officer asked Mr. Larmore where his cellphone was located, and Mr. Larmore responded that it was inside the home.
“This questioning amounted to a custodial interrogation without Miranda warnings,” Waxman wrote, maintaining that the “coerced statement” provided officers with a basis for asking Larmore’s pregnant fiancee about the cellphone, which she retrieved and gave them.
Larmore is well-known in the Punta Gorda area. His Arciterra properties included a waterfront development of condos, shops and restaurants called Fishermen’s Village near his home, The Daily Sun newspaper has reported.
Like Belleville Crossing, the development got tangled in Larmore’s legal and financial problems. A receiver was appointed to take over management.
After the Belleville investors filed their lawsuit against Larmore in 2023, he told a Sun reporter by text that former employees he had helped were causing “chaos” and interfering with his business.
“It is unfortunate that some have lost faith in me after all I have done to give ownership opportunities to provide for themselves and their families of advancement and growth,” Larmore wrote. “I am staying positive among all the lies.”
Larmore’s trial in New York City lasted a week, ending with a guilty verdict on Oct. 22, 2024. The defense had argued that he was a “rank amateur” whose “awkward scheme was doomed from the start” and not a professional trader, broker, dealer or salesman, according to a Bloomberg report.
Before sentencing, Larmore’s other lawyer, Bruce Udolf, told Judge Engelmayer that he had been profoundly affected by the end of his marriage and the death of his nieces in a plane crash.
“He is not the wanton criminal he was portrayed as,” Udolf said.
Prosecutors asked for Larmore to spend 7 1/4 to nine years in prison for treating the stock market as “his own personal plaything,” Bloomberg reported. Engelmayer settled on five, plus the community service.
Larmore has been free on a $3 million personal recognizance bond since his arrest, with travel allowed only to five states and the District of Columbia.
After his conviction, Engelmayer added restrictions, prohibiting Larmore from flying on planes without government approval, boarding boats of any kind or communicating with purveyors of watercraft.
The defense filed a motion in district court for “release pending appeal,” asking that Larmore be allowed to remain free on bond while the case proceeds in the Second Circuit. Engelmayer denied it.
Larmore then filed a similar motion with the appellate court, and Circuit Judge Beth Robinson agreed to stay his surrender date until after the three-judge panel makes a decision on the bail question.
