Wow, that is a toughie. Your solutions seem pretty few and far between

If anyone tried that crap on us, they would be extremely sorry. I am not peaceable about our pets being lured. (Not that this has ever happened)Now having said that, we would NEVER allow any of our pets to roam outside without supervision, so your situation would not arise for us.

Everything you have said points to your cat basically having moved out from your place. If the cat is licenced to you (they do that here in my area) then I would let the authorities know that this cat has been taken over by the neighbour and you are no longer responsible for it. I recommend you stop feeding.

If you can't move, then get another cat, but make sure you never let it out.

This old geezer sounds like a loony-tunes so I doubt you will ever win this particular argument.

As I said, the consequences to any neighbour of ours trying that particular trick would be extremely serious. But not everyone has such a vindictive nature as I.