It can be very hard to eliminate people from your life, particularly if culturally families are very enmeshed.
Establishing personal boundaries for people in your family who are difficult will set parameters. When you establish your own boundaries, you make the rules that they need to abide by to remain in your life. It is hard to do, but if you stick firmly to them you do have the power to tell this guy how you expect to be treated in the future.
He is not your friend. Outside of financial stress, that sounds like the most painful part of your story, someone you cared for in the past has hurt and disappointed you, and reinforced what you already knew about his character.
It sounds like in spite of your anger, you have already prepared yourself with the possibility of never recovering the money.
I don't think that there are good and bad people. I have people in my family who have done the most dreadful of deeds and it breaks my heart to let them go. It doesn't help when you care about them, it just makes it harder to accept that they don't care about you. But it sounds like he doesn't care about you. Perhaps he doesn't have the capacity to care about people.
The turn around of money that is needed fast sounds like a dangerous situation that you should be cautious of becoming involved in in.
Keep your relationship superficial, if you need to remain in his life for the safe keeping of his wife and child.
Boundaries are parameters set not only for financial issues but emotional and physical safety too. Don't allow past arrangements to define who you are now, relationships change and the rules change too.
Humans can be disappointing but you will meet many that are amazing too. Don't close yourself off to all the good ones because of one Gruber.