Tuesday, April 12, 2016

Feds Squeeze Guilty Plea Out Of Oregon Property Manager For Swindling Over $3.5 Million From Landlord-Clients, Investors; Probe Triggered When One Victim Complained To State Regulator After Being Stiffed With Rubber Checks

In Eugene, Oregon, The Oregonian reports:
  • A former Eugene property manager pleaded guilty [] in federal court to swindling more than $3.5 million from property owners and investors.

    Terry Shockley, owner and operator of now-defunct TS Property Management, was one of the largest landlords in the Eugene area. He'll be sentenced in September, according to the U.S. Attorney's Office.

    Shockley, 63, pleaded guilty to two counts of wire fraud in U.S. District Court in Eugene, the Register-Guard reported. He agreed to a restitution order for the entirety of his victims' losses as part of a plea agreement, federal prosecutors said in a news release.

    He faces as much as 20 years in prison on each count, prosecutors said.

    Officials began investigating Shockley after one of his clients told the Oregon Real Estate Agency in November 2014 that checks from Shockley's company were returned because of insufficient funds, according to court records.

    The agency, which is tasked with regulating almost 700 property managers in the state, found that Shockley had falsified bank documents previously provided to the agency as part of a 2013 mail-in audit.

    Investigators also determined that Shockley swindled money and property from TS Property Management clients, client-investors and others. He did this, court records show, under "materially false and fraudulent pretenses, representations, and promises."

    That includes paying the company's operating expenses with misappropriated funds and withdrawing "large sums of money" for personal use.

    The agency also found that he kept all rent and deposit funds in one trust account when they should have been kept in separate accounts, according to the court records. The single account hadn't been reconciled in more than two decades.

    Shockley had been the sole signer for the company's accounts, court records show. He was the only person who decided what bills should be paid and when the company would pay them. The company didn't have any financial controls or reporting that tracked its monthly expenses or income, court records show.

    He was managing about 350 properties, according to the court records.

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