FEDS BUST RAINMAKER
By PETER GREEN

August 24, 2005 -- Federal agents yesterday morning launched a double-raid on the Chelsea offices of a New York-based investment group that fleeced investors in old age homes with promises of sky-high returns.

Hours after dozens of FBI agents left the West 23rd Street offices of Rainmaker Managed Living, removing a safe, computers and crates full of documents, agents of the Securities and Exchange Commission raided the same offices, and also hit Rainmaker's offices in New Jersey and Long Beach, Calif.

Rainmaker's scam was highlighted in The Post last month after the newspaper was contacted by Barry Minkow, a convicted former fraudster who is now an ordained minister in California and who has turned his hand to uncovering frauds.

In newspaper ads in New York and California, Rainmaker said providing care to America's aging baby boomers would be the "oil business of the 21st Century."

It promised investors 25 percent returns and said the investments were backed by the real estate and government securities.

The SEC said that Rainmaker had promised to hold investors' money in escrow accounts, but instead they were running a giant Ponzi scheme.

"The defendants misappropriated over half the money for their own personal use and to make purported interest payments to investors."

The SEC said that three defendants — Alirezha Dilmaghani, Sidney F. Levine and J.J. Conway — paid themselves more than $3.75 million and paid another $850,000 of investors' money back to selected investors as interest.

"It's just obvious fraud," Minkow told The Post yesterday. "Their business model is untenable, and they don't own any property. They are just selling air."