MANHATTAN SUPREME COURT — A would-be high-rolling entrepreneur married to a Manhattan socialite allegedly pocketed $600,000 in investments from some of the city's boldfaced names to start a high-end virtual fashion marketplace — then never delivered on the site, prosecutors said Monday.
Andrew Albert, 49, of the West Village, allegedly promised to develop On1Ave.com, a virtual-reality shopping site in which shoppers can use avatars to try on clothes at designer stores before deciding whether to buy them.
Albert pleaded not guilty to felony charges of grand larceny, scheme to defraud and criminal tax fraud at his arraignment Monday. He faces up to 15 years in prison if convicted. He was released on his own recognizance Monday but declined to speak to reporters.
Albert reportedly came up with the idea of the website with the help of his wife, socialite and actress Annie Churchill. She had bragged to the New York Observer in 2008 that she wasn't concerned about making then-boyfriend Albert the CEO of the new venture, called Virtual Etail Group.
“Normally, I would say yes, but we’re both so professional that I really am not worried," she told the Observer in October 2008. "Everyone in our company is friends, which people say is a big no-no, but I don’t worry.”
Instead of spending his time developing the site from 2008 to 2010, Albert spent the cash on groceries, clothing and bills for himself and his parents in Florida, the District Attorney's office said at his supreme court arraignment on Monday.
“Andrew Albert falsely told investors that his shopping website would feature a virtual street akin to famous retail boulevards like Madison Avenue or Rodeo Drive," Manhattan DA Cy Vance Jr. said, adding that Albert did nothing more than create a business bank account that was used only "for his personal expenses and lavish lifestyle."
Churchill was not present at Albert's arraignment Monday. She has not been named as part of the criminal charges. Money from her trust fund made up most of the seed money for the project, along with the $600,000 in investments, which were all placed into one business account, prosecutors said.
But things soon went sour as Albert and his company, Virtual Etail Group, were sued last year by investors Michael Bedrick, the family of William Heath and the Robert Johnston Family Trust. Bedrick had been friends with Churchill for 30 years, prosecutors said.
Albert also accepted a $20,000 investment from Melissa Skoog, a former assistant for Vogue editor Anna Wintour and former vice president of PR at Prada, who was hired to work with Albert on the venture.
Prosecutors said he returned Skoog's money when she started asking questions and then fired her and also threatened to sue her.
"[Albert] has shown he is untrustworthy and a self-interested character and is willing to put his own desires ahead of others," Assistant District Attorney Jose Fanjul said in court.
His attorney, George Farkas, said the allegations were being worked out in civil court and that his client should not have been criminally charged.
Albert is due back in court on Oct. 11.