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Real estate developer sues JPMorgan over allegedly fraudulent property transfers

Mexican real estate developer BVG World SA, owned by local entrepreneur Elias Sacal Cababie, has filed a lawsuit against JPMorgan Chase & Co. on charges of fraud, unjust enrichment, defamation, civil racketeering and other wrongdoing, Reuters reported.

BVG is seeking $400 million in damages on some of the charges and around $1.2 billion on the racketeering charge.

The lawsuit, filed with the U.S. District Court in Manhattan on June 11, accuses JPMorgan of fraudulently inducing BVG to transfer hundreds of millions of dollars worth of real estate to the bank in September 2012, with the understanding that the bank would sell the properties to recoup a $99 million loan it granted to BVG.

The real estate developer now claims that JPMorgan "never intended to fulfill its promise" to sell the properties and instead took over them to "exact revenge" over business disagreements that BVG thought had been settled in 2010, the newswire reported.

The plaintiffs also allege the bank tried to harm Sacal's reputation by "badmouthing" him to peers, including the supposed use by some executives of anti-Semitic insults when referring to the Jewish businessman.

In a statement, JPMorgan said the accusations of wrongdoing have no merit and are "part of a process by Mr. Sacal aimed at avoiding fulfillment of financial obligations." A lawyer for Sacal told Reuters that JPMorgan is the party trying to evade its obligations.

BVG earlier said an arrest warrant has been issued for Eduardo Cepeda, JPMorgan's country head for Mexico, who was accused of fraud related to a loan the bank granted to BVG in 2007. The bank also denied those accusations.