More Hot Water For Crisp & Cole In Alleged Bakersfield Flipping Operation

KGET-TV Channel 17 in Bakersfield, California reports:

• "The California Department of Real Estate has filed a formal accusation accusing David Crisp and Carl Cole and their now-defunct realty firm of fraud. The accusation names Crisp, Cole, the Crisp & Cole firm, Tower Lending, and several others with whom they allegedly performed unlawful real estate transactions. The action could result in the revocation of the licenses of the accused. [...] In one instance, the accusation says, Cole falsely claimed he was buying a house in which to live. In fact, the accusation says, he intended to sell it. [In another instance] Crisp told one mortgage company that a woman was an employee of Crisp, Cole and Associates to help her get a loan, the accusation says. She never worked for the company, the claim says."

Crisp, Cole & Associates misled lenders on more than $12 million worth of loans, state regulators said in an accusation filed Monday.

For more, see State accuses Crisp & Cole of fraud.

For a copy of the formal complaint filed by the State of California with the Department of Real Estate, see In the Matter of the Accusation of Crisp Cole & Associates, et al.

For the Bakersfield Californian stories, see Firm's troubles mount (State agency alleges fraud, 'dishonest dealings' in filing) (Reportedly, staffers, family members, business associates and customers owe $48.2 million on defaulted or foreclosed first loans as of Wednesday, according to an ongoing Californian tally) and Crisp, Cole allegations explained (Regulators say case is among largest of its kind in region).

For subsequent KGET-TV stories, see:

• Crisp, Cole & associates duck cameras following DRE accusation (TV report can be seen here)

• Local real estate community abuzz about DRE's accusations (TV report can be seen here)

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In a related story, two homes that were originally bought for around $1 million each and that may have been involved in the alleged flipping operation involving David Crisp and his associates were recently sold at trustee's (foreclosure) sales at big losses to the mortgage lender. The reported estimated loss to the foreclosing lender was $350,000 in one case, and $400,000 in the other. Two more Crisp family-owned homes are scheduled to be sold today. For more, see Some Crisp family properties sold.

Go here to watch the recent KGET-TV Channel 17 report; and here for other posts and links to media reports on the alleged flipping operation involving David Crisp, Carl Cole, family and associates.

Bakersfield Broker's Flipping Operation Back In The News

The Bakersfield Californian reports:

• The mother-in-law of Realtor David Crisp, Leslie Sluga, recently had two homes enter default, property records show. The delinquent loans are a first for Sluga, although scores of defaults and foreclosures have touched other family members of the former Crisp & Cole Real Estate company's staff and business associates over the past year.

***

• [A California Department of Real Estate] complaint alleged Sluga and her daughter, Jennifer Crisp, were allowed by Crisp & Cole to report false employment information on loan documents. [...] The women reported nonexistent positions at Crisp & Cole and the accounting business owned by Sluga's husband, state regulators allege.

***

• Two days after the state complaint was filed, FBI and federal tax agents raided 13 sites around Bakersfield related to [the now-defunct real estate brokerage] Crisp & Cole. That investigation is ongoing. No charges have been filed. Crisp and his former business partner, broker Carl Cole, have left a string of at least 107 troubled properties carrying more than $66.6 million in loans in the wake of their defunct company's operations, according to an ongoing Californian tally. As of Friday, at least 80 of those have foreclosed, the Californian's research found.

Crisp has not been charged with any crimes, but reportedly is the subject of a Federal investigation. For more, see Crisp relative's homes in default.

See also, KGET-TV Channel 17: Radio host questions embattled realtor outside restaurant:

• An ambush interview with embattled realtor David Crisp has become the talk of the town online. A local radio personality grabbed a camera and confronted Crisp after spotting him at a local restaurant. KRAB radio host Francis Mayer said when he saw Crisp eating at [a local eatery] Monday, he had to ask him some questions.

Go here for past Bakersfield Californian stories about the Crisp & Cole home flipping operation.

Go here for earlier posts on David Crisp and his alleged flipping operation.

California Feds Raid 13 Locations In Crisp & Cole Alleged Flipping Operation Investigation

In Bakersfield, California, KBAK-TV Channel 29 (and KBFX Channel 58) reports:

• "29 Eyewitness News has learned the FBI is raiding homes and businesses of the once prominent real estate duo Crisp & Cole.The FBI began raiding 13 locations about 7 a.m. this morning. Special Agent Steve Dupre works in the FBI office in Sacramento. He says the search warrants were served with the following agencies participating: Bakersfield Police Department, Kern County Sheriff's Department, the Internal Revenue Service, and the California Department of Real Estate. [...] Eyewitness News asked Dupre if 13 is an unusually high number of search warrants to be executed at one time for one investigation and he said yes, often times an investigation requires several warrants, but not usually as many as 13."

• "Today's raids come as the California Department of Real Estate [in a separate investigation] has a number of serious accusations against the once, high profile Bakersfield real estate team, Crisp & Cole. The DRE says it was an investigation, quote, "several months" in the making. The realtors could have their licenses suspended or even revoked."

The now-defunct Crisp & Cole real estate brokerage was once operated by partners David Crisp and Carl Cole.

Go here to watch today's KBAK-TV news report. To read the KBAK-TV online report, see Crisp & Coles businesses & homes raided by FBI.

To read the KGET-TV Channel 17 report, see FBI raids Crisp home and offices.

Go here for a review of the players and some of the properties involved in the alleged flipping operation.

Go here for other posts and links to stories on the Crisp & Cole alleged flipping operation.

New Defaults On Crisp & Cole Property Flips

(revised 8-5-07)
The Bakersfield Californian reports:

• "Four new defaults have rolled in for former Crisp & Cole Real Estate partners and spouses in less than a week, public records show. The latest default notices add more than $1.7 million in primary loans to a growing list of Crisp & Cole-related properties in some stage of foreclosure."

This story update involves the suspected property flips in the Bakersfield, California area involving David Crisp, Carl Cole, business associates and family members. For more, see New defaults for Crisp, Cole, records show (Cole says one of homes has offer on it already).

See also, Crisp & Cole defaults: Nightmare on Ordsall Street (Agent: Crisp & Cole took advantage of weak for gain) (The Bakersfield Californian - 8-4-07).

Go here for other posts on the Crisp & Cole ongoing saga.

Unwitting Straw Buyer Sues Bakersfield Broker For Unauthorized Use Of His Name In Flipping Deal, Ruining Credit, Leaving Him Holding The Bag

In Bakersfield, California, KGET-TV Channel 17 reports:

• An Oakland man is suing former Realtor David Crisp, saying Crisp used the man's name in a house flipping scheme that ultimately defrauded lenders. Jorge Ochoa says David Crisp destroyed his good credit. Ochoa wants $75,000 in damages. "He was just a victim, one of many, of the scams of David Crisp," Ochoa's attorney Harvey W. Stein said.

• The state stripped Crisp of his real estate license following a hearing in July 2008, and he and his former business partner Carl Cole are the subjects of an ongoing FBI mortgage fraud investigation.

***

• Stein filed a lawsuit on Ochoa's behalf for $75,000, saying Ochoa's credit card interest rates have gone through the roof. But Crisp has not responded to the lawsuit, and Stein is moving for a judge decide in his client's favor by default.

For more, see Suit: Man was victim of David Crisp scheme.

For the lawsuit, see Ochoa v. Crisp.

Tax Lien Filed Against Bakersfield Flipper

The Bakersfield Californian reports:

• State tax officials filed a lien against David and Jennifer Crisp this week for taxes owed from 2005. The $35,746.55 lien from the California Franchise Tax Board, which was filed at the county recorder's office Tuesday, is the latest in a string of financial, regulatory and possibly criminal troubles dogging principals, family members, employees and business associates of former Crisp, Cole & Associates companies. David Crisp could not be reached Friday by cell phone. The 28-year-old real estate agent previously ran Crisp & Cole operations with one-time partner Carl Cole, 60.

***

• As of Friday, at least 105 defaulted and foreclosed properties are linked to associates of the former Crisp & Cole companies, according to an ongoing Californian tally. More than $64.6 million in total loans were taken out against the homes, according to The Californian's analysis. So far, 61 have foreclosed. Of $36.9 million in first and second loans taken out against those 61 properties, public foreclosure auctions have netted $28.1 million, county filings show. All auctions so far have resulted in lender repossessions.

For more, see IRS files lien on Crisp, his wife from '05 taxes.

Go here for special section on the Crisp & Cole "escapades" compiled by The Bakersfield Californian.

Go here for other posts and links to stories on the David Crisp / Carl Cole alleged flipping operation.

102 Troubled Properties, $62M+ In Mortgages Tied To One Bakersfield Group Under Investigation

In Bakersfield, California, The Bakersfield California reports:

• Carl Cole, former managing broker of now-defunct Crisp & Cole Real Estate, counted his first two foreclosures Thursday, trustee's deeds recorded with the county show. They are so far the only foreclosures in the Cole family, but just a pair among more than 100 defaulted and foreclosed properties associated with the former company's employees, family members and associates, according to an ongoing Californian tally. Federal investigators are currently looking into Crisp & Cole operations for possible mortgage fraud after a federal raid of 13 Bakersfield sites Sept. 12.

***

• As of Thursday, 102 troubled properties with more than $62.3 million in total loans can be pegged to former Crisp & Cole associates, according to The Californian's ongoing tally. Of those, at least 57 have so far foreclosed. On Monday, the Seven Oaks mansion of Cole's former partner, David Crisp, is scheduled for the auction block.

For more, see First of Cole's properties foreclosed (David Crisp's mansion set for auction Monday).

Go here for other posts and links to stories on the David Crisp / Carl Cole alleged flipping operation.

Owner Of Event & Wedding Venue Loses Building To Foreclosure After Pocketing Thousand$ From Soon-To-Be-Married Couples, Leaving Them High & Dry

In Chattanooga, Tennessee, the Times Free Press reports:

• Lindsay Street Hall, a high-profile event and wedding venue in downtown Chattanooga, was sold to a new owner [] at a foreclosure auction on the courthouse steps because the former owner, who filed for bankruptcy in October, wasn't paying the mortgage — which means about 10 couples will be out thousands of dollars they already paid for weddings.
  
  "If I hadn't been there [at the auction], the building would have been padlocked," said Chattanooga businesswoman Tara Plumlee, who was the sole bidder for 901 Lindsay St., a former First Congregational Church that's on the National Register of Historic Places.
  
  Plumlee, who owns three other local event venues and a catering company, will rebrand the building as 901 Lindsay.
  
  She said she spent Tuesday contacting couples who had prepaid for weddings with Kenneth E. Crisp Sr., the owner of the now-defunct Lindsay Street Hall.
  
  "Some of them are out all of their money," she said, adding that some wedding parties are out $20,000.
  
  Plumlee said she can't do the upcoming weddings free of charge, but she's trying to work out something.
  
  "I've been working with every bride, every momma of the bride," she said. "We've been on the phone with everybody. We've cried together. There are parents that are hiding it from their children. We've been instructed not to tell certain brides."
  
  "This has been an incredible scandal, and I'm trying to do my darnedest," Plumlee said. "That's why I showed up on the courthouse steps — because I just wanted to do the right thing."
  
  'He assured us there weren't any issues'
  
  The Times Free Press contacted several couples who had prepaid for upcoming weddings at Lindsay Street Hall, but they declined to comment on advice of their attorneys or because they wanted to focus on their upcoming nuptials.
  
  Crisp's bankruptcy court filings show that in October eight couples prepaid an average of $3,500 for upcoming weddings. But Plumlee said that some couples paid more since then, as much as $20,000.
  
  "May is a big wedding month," she said. "Those people have already paid in full."
  
  One man, who had prepaid for a wedding but didn't want to be named, said Ken Crisp Sr. assured him not to worry about the May 3 foreclosure auction, because Crisp promised that he'd retain control of the venue.
  
  "He assured us there weren't any issues," the groom-to-be said. "We had already paid them a little more than $5,000."
  
  Crisp didn't return phone calls left at the telephone number he put on court documents filed in U.S. Bankruptcy court in the historic courthouse on 11th Street in downtown Chattanooga.

For more, see Families lose thousands after Chattanooga wedding venue goes bankrupt.

In a related story see Wedding insurance offers safety to help couples prevent disaster on their big day:

• "Our biggest claims are really venue-related," said Todd Shasha, a managing director at Traveler's, a publicly-traded insurance giant that has about 30,000 employees. "[Wedding] pictures never show up. Your florist does not deliver the flowers."
  
  Insurance typically covers the cost of lost deposits if a venue goes out of business. It also can pay to reconvene the wedding party to retake photos if the photographer doesn't show.
  
  Insurance can cover costs in the case of natural disasters, such as tornadoes, that make weddings impossible, and reimburse in the case of other wedding disruptors, such as the illness of a bride or groom or their military deployment.
  
  "Obviously, you never know when you're going to get deployed," Shasha said.
  
  Traveler's least-expensive policy is $160, Shasha said, and covers such things as $7,500 toward the venue and $1,500 toward the wedding photographer. Traveler's wedding insurance tops out at $1,025, which covers a $175,000 wedding. "The average cost of a wedding, I think it's around $30,000 today," Shasha said. "If you don't have the coverage, you're really putting it all at risk."
  
  Wedding insurance isn't a big product line for insurance companies, though Traveler's spokewsoman Sperry Mylott said its popularity is growing.
  
  There are no deductibles with Traveler's wedding insurance plans, so couples who buy one don't have to pay anything out of pocket.
  
  [Insurance agent Jim] Hartley said he's only sold two wedding insurance policies. "It's not popular in this area," Hartley said. "In Tennessee, [many] people go to the JP — justice of the peace."
  
  Cold feet is one thing that wedding insurance is not good for, he said. "If the bride backs out or the groom backs out — that's not covered," Hartley said.

More On Media Investigation Of Alleged Bakersfield Flipping Operation

KBAK-TV Channel 29 in Bakersfield, California has their own coverage of the alleged intra-family home flipping operation involving real estate agent David Crisp, the now defunct real estate company, Crisp & Cole, and company associates. For their report, watch the KBAK-TV report; or to read the online story, see More questions for David Crisp.

Go here for other posts on David Crisp.

California Regulators Investigating Defunct Real Estate Company's Ties With Sour Loans

The Bakersfield Californian reports:

• "It's impossible to know what state regulators are looking for as they examine files of the former Crisp & Cole Real Estate company. Two former staffers recently told The Californian that investigators from the state Department of Real Estate have been asking questions and requesting files. Meanwhile, default notices continue to pile up for properties related to Crisp & Cole. [...] Californian research has uncovered a pattern of property turnover among Crisp & Cole associates, steep price increases and 100 percent financing by subprime lenders in many of the properties now defaulting."

Quick flips involving some of the homes now sitting empty that are described in the article may point to possible improprieties that underlie the transactions.

For more, see Crisp defaults pile up (Latest notice on $1.75 million loan for Seven Oaks mansion).

Possible House Flipping Operation Subject Of KGET-TV Investigative Report

KGET-TV Channel 17 in Bakersfield, California reports:

• "Why is the family of real estate agent David Crisp the most named in local mortgage default these days? 17 News has been investigating the story for the better part of six months, and public documents reveal a pattern of home sales between Crisp and members of his family. In the cases we uncovered, some members of the family make huge profits, while some take huge losses, at least on paper. In reality, while the profits are real, it is only the mortgage companies that lose real money."

Reportedly, the common elements in many of these deals described in the KGET report are inflated appraisals, intrafamily sales, 100% financing, and the subsequent filing of notices of default by the mortgage lender. There was at least one case of equity skimming, according to the story, where a family unwittingly moved into and paid rent on one of the homes in the flipping operation, only to have to move out two months later because the home went into foreclosure.

For the damning KGET-TV Channel 17 investigative report, watch Crisp's Kinship Deals (by investigative reporter Kiyoshi Tomono).

To read the online story, see Crisp & kin circulate houses, money between them.

Go here for other posts on this story. alpha

Real Estate Agent Finds New Foreclosure Listing "Burnt To A Crisp"

In Indiana, DS News reports:

• When Chris Price with the Chris Price Real Estate Team in Indianapolis, Indiana, headed out to one of his newer listings, he never imagined what he would find. “We received this assignment, and I promptly ventured out to visit the property,” Chris remembers. “Upon arrival, I knew this would be a 'hot deal' if you catch my drift.” All kidding aside, Chris said the sale was pretty much “null and void” from that point on because the home had been burnt to a crisp. To this day, Chris doesn't know what started the fire, and it's uncertain if the fire was a result of the foreclosure itself. But to this day, he is reminded of what could have been. “We thought that we might offer this one up as a 'fire sale' but the bank decided they wanted it back. It was a bummer, but this property will be charred in my memory for a long time,” Chris concluded.

Source: REO Horror Story: Nothing to Sell, But Charred Debris.

For other stories on fires & foreclosures, go here , go here , and go here. foreclosure arson xerox

Anatomy Of A "Cash Back" Home Flip That Ended In Foreclosure

The Bakersfield Californian provides a detailed analysis of a property flip that ultimately ended in foreclosure that involved associates of the now defunct Crisp & Cole real estate company in Bakersfield, California. Included in the story are links to the actual recorded property records used in the transactions. For more, see How one flip unfolded.

Go here for other posts and links to stories on the David Crisp / Carl Cole alleged flipping operation.

New Form Of 'Foreclosure Stripping' Scam Rearing Its Head?

KGET-TV Channel 17 in Bakersfield, California reports:

• There's a new problem with real estate foreclosures as some residents have resorted to stripping everything from appliances to door-knobs from foreclosed homes before the houses go back to the bank.

• A neighbor said she took digital pictures on Labor Day of a male trio backing up a red truck into the home's driveway and securing a $4600-Viking stove to a flatbed trailer. [T]he lender took [the home] back two days after the pictures were taken. [...] The agent now trying to sell the home said more than $20,000 in property has been taken.

For more, see Taking everything but the kitchen sink from foreclosed homes.

Go here to view the KGET-TV Channel 17 video report.

For a story update, see No criminal charges in case of stolen appliances (Last week, 17 News told you about a police crime report filed regarding appliances taken from a home once owned by Crisp and Cole real estate agent Jeriel Salinas. Police have since determined it was a civil matter and will not be pursuing criminal charges. The current real estate listing agent said a $4,600-Viking stove was taken from the home, along with a microwave and dishwasher.).

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For a story on a homeowner in foreclosure being criminally charged for "endangering a security interest" for removing appliances, cabinets, lighting fixtures, door knobs and other items with an estimated value of more than $25,000 from a foreclosed house, see Homeowner In Foreclosure Charged For Trashing House Days Before Public Auction (the foreclosing mortgage lender held a security interest in the stolen items, according to the arrest warrant application).

Editor's Note: Assuming a home mortgage contains a standard "assignment of rent" provision, a mortgage lender likewise holds a security interest in any rent that may be collected from a tenant and pocketed by a landlord in foreclosure. A landlord pocketing rent in this manner without applying the money to the mortgage loan (ie. equity skimming or rent skimming) could potentially be also subject to criminal charges for theft of a security interest.

Go here for other posts on foreclosure fixture stripping. foreclosure fixture stripping apple David Crisp

California DA Dropping Ball On Mortgage Fraud?

In Bakersfield, California, KGET-TV Channel 17 reports:

• The fight over real estate fraud spilled onto the editorial pages and airwaves of local talk radio shows Friday. On Thursday, local appraiser Gary Crabtree wrote an opinion piece in the Bakersfield Californian newspaper accusing District Attorney Ed Jagels of dropping the ball on mortgage fraud. Crabtree said he presented a major case of mortgage fraud to Jagels a year ago, but Jagels never followed through. So, in an opinion article published Thursday, Crabtree said he had to turn to the FBI for help. [...] Meantime, bloggers have speculated for weeks about Jagels' motives for declining to take on the case. On Friday, Jagels confirmed he is friends with one of the people the FBI is investigating for mortgage fraud. Agents raided the office of Mark Newton of San Joaquin Appraisals as part of their investigation into local real estate agents David Crisp and Carl Cole.

For more, see DA accused of dropping ball on mortgage fraud; or go here to watch the KGET-TV Channel 17 report.

For a contrary opinion, see Ed Jagels is right: Fraud unit not needed (The Bakersfield Californian - 10-12-07).

For a related post, see California DA Denies Need For Fraud Unit.

For a story update, see County creates trust fund to crack down on real estate fraud (Concerned that the continuing rise of foreclosures in Kern County could be fraud related, Supervisors unanimously adopted a resolution establishing a trust fund to investigate and prosecute real estate fraud).

Go here for other posts on this story.