Saturday, June 03, 2017

Troubled Operations, Chaos Force Over A Dozen Elderly Residents In Assisted Living Facility To Abruptly Pack Their Bags & Move, Leaving Flustered Families Scrambling To Find New Accommodations For Loved Ones

In Sahuarita, Arizona, Green Valley News reports:
  • Thirteen residents of two Sahuarita assisted-living homes found themselves abruptly moved to new facilities Thursday and Friday [May 19 & 20], but exactly why remains unclear.

    Several residents and their families said they were told they had to move because their caregivers had walked off the job after going unpaid for weeks.

    Jerone Davis, owner of Rancho Verde Duval and Rancho Verde Canalito homes, denied that he was behind on paying employees, but said his seven homes between Sahuarita and Tucson had 17 visits from several agencies over the past two months after complaints were filed.

    The scene at one of the homes in the Valle Verde del Norte neighborhood was near chaos Thursday as flustered relatives rushed to pack up belongings. Some were in tears as they wheeled their loved ones out of the home. A couple said they were angry and confused about the situation and too upset to speak with a reporter.

    In an interview at Rancho Verde Duval on Friday, Davis said that for unknown reasons his operations manager called all of his certified caregivers Wednesday night and told them not to report to work.

    The state Department of Health Services confirmed they were overseeing the moves but said they were not the result of “action taken by DHS,” said Holly Ward, communications director.

    Connie Weber, deputy press secretary for the Arizona Department of Economic Security, said that “because of state statutes regarding client confidentiality, the DES Division of Aging and Adult Services Adult Protective Services program can neither confirm nor deny any involvement in any case.”

    Sahuarita Police Lt. Matt McGlone said late Friday that they are investigating “a complaint of possible fraud against the owner and management of that care home and we are aware of a current investigation by the AG’s Office outside the Town of Sahuarita.”

    While police were at Rancho Verde Duval on Friday to take a report, Davis arrived and spoke with the officers and an APS representative.

    “I want to thank the families for letting me take care of their loved ones and to say I’m sorry this happened,” Davis, 53, told a reporter. “I hope they give me the opportunity to explain my side of what transpired.”

    Over the past three years, Davis said he purchased seven assisted-living facilities in Tucson and Sahuarita under the umbrella of Rancho Verde Care Communities. Over the past two months, he said numerous complaints were made to the state Attorney General’s Office, APS and DHS resulting in 17 visits from those agencies.

    “A lot of the families started to get concerned and they started to pull their families out,” Davis said, prompting the closure of three Tucson homes.
    Last man out

    On Friday morning, Joe Kovacs, 80, was the last resident at Rancho Verde Duval. His friends, Bobbie Fankhauser and Nathan Hedman, were trying to find a company capable of transporting a wheelchair to take him to his new home on Tucson’s east side.

    It was Kovacs’ third move in six weeks. He had just moved into Rancho Verde Los Reales when Davis shut it down and moved him to Rancho Verde Duval.

    When Fankhauser was told Kovacs was being transferred to a sister facility in Green Valley three weeks ago, she wasn’t happy, but understood. [...] Not only was she panicked about finding Kovacs a new place to live, she was also angry. She paid Davis six months in advance and she had to come up with $2,700 for the new facility.

    I feel ripped off, obviously, and like a sucker,” Fankhauser said Friday.

    She said it wasn’t Davis or any of his caregivers who called her. The owner of another facility who was taking in patients left a voicemail for her in the morning that she didn’t receive until after 5 p.m.

    Jeanie Anstey, 91, lived at Rancho Verde Duval for a year.

    “It was very good at first and then it went downhill,” she said.
    When they were told they were going to have to move, Anstey said everyone was upset because they’d become like family. “It was terrible,” she said. “It made me sick to my stomach. I can’t believe the person who owns these homes let this happen.”

    Anstey found a comfortable place nearby and considers herself lucky. She’s also fortunate that she paid Davis on a month-to-month basis, she said. “Some people had paid a year in advance,” Anstey said.

    Davis said he always pushed for quality care at his homes and will work to straighten out the situation.

    “My objective is to meet with all of the family members in the next week to discuss meeting my financial obligations,” Davis said.

Tenants Complain About Living Conditions In Apartment Complex; Landlord Responds By Giving Them 30 Days To Pack Their Bags & Get Out

In College Park, Georgia, WGCL-TV Channel 46 reports:
  • People at one apartment complex in College Park say their living conditions are a health hazard and after complaining to management, they're now facing eviction.

    Several residents at Avery Park Town Homes signed a petition and after it was brought to the attention of management, they received eviction notices.

    Several people told CBS46 their air conditioners aren't working. One family said they found bugs in their bedroom last year. Others said their floors are weak and are in danger of caving in. The people said their maintenance request go unanswered. One woman decided to write a petition but was given an eviction letter as a response.

    "She gave me a 30 day notice telling me that I have to leave on the 31st of this month saying I violated my lease," Geradine Evans told CBS46.

    Evans said she's being targeted and always pays her rent on time. CBS46 went to the leasing office to get the manager's side of the story but was told, "no comment." Evans said she's not moving out and plans to hire a lawyer.

Non-Payment Of Utility Bills, Mass Evacuation; Water & Electricity Shutoffs Lead To The Boot For Dozens Of Low-Income Central Florida Residents In 150-Unit Condo-Hotel

In Kissimmee, Florida, the Orlando Sentinel reports:
  • At the Heritage Park Inn outside Kissimmee, worldly possessions sat wrapped in plastic bags on balconies as dozens of people wondered Monday [May 15] where they would spend the night.

    “I don’t know, honestly,” said Stacey Modjeski when asked where she would live after the electricity was turned off at the inn, a condominium that used to be a hotel on U.S. Highway 192. “I don’t. I’m really upset. I have to find another place to go.”

    The power was disconnected Monday, a Kissimmee Utility Authority spokesman said, after nearly a month of residents living without water after management fell behind on its bills to the Toho Water Authority. It also stopped paying the KUA, which provides electricity.

    In total, the two providers are owed close to $28,000. The Toho Water Authority said it hadn’t been paid $19,187.39, and the KUA is owed about $8,300, officials said.

    Osceola County spokesman Mark Pino said county staff members have spoken with more than 40 residents to determine whether they’re eligible for assistance through Rapid Rehousing programs, designed to help families transition from homelessness to long-term sustainable housing

    “It typically takes 30-60 days to find housing for these families,” Pino said. “Most of these families are able to find housing in Osceola County.”

    Other agencies, such as the Homeless Services Network of Central Florida, also are working with some residents.

    KUA crews were on scene early Monday. A spokesman told the Orlando Sentinel last week that crews have gone to the inn in previous months, but typically a last-minute payment was made to keep the lights on.

    That didn’t happen this time.

    “I woke up when the air conditioner went off,” resident Darla Wyatt said. “I thought, sh--, it’s really happening. Happy Mother’s Day, the power stayed on for one more day.”

    The inn has about 150 units and is home to mostly low-income residents. Seniors, veterans and families with young children reside at the former hotel near Florida’s Turnpike.

    Residents pay about $700 per month in rent, which they said also covered their utility bills.

    On Monday, garbage was piled up in corridors and scattered among the grounds, which residents said had attracted larger rats as building maintenance deteriorated.

    Lately, nobody had been at the front office to collect their money, residents said. The doors to the locked office were covered with shutdown notices on Monday.

    “We’re just looking for any place to go,” said Matthew Aikens. “It’s been stressful, especially with them draining the pool on us so we can’t flush our toilets anymore.”

    Aikens said he had four children living with him, and neighbor Rachel DeSilva said another resident just came home with a newborn baby last week.

    “It’s heartbreaking, you know,” Modjeski said. “I know other families in here who can’t go anywhere else. They have no money, no transportation. … My kids go to [Mill Creek] elementary school. Twenty-one elementary school kids stay in this hotel alone, just in that school.”

    Resident Richard Jennings shook his head when he thought about the inn’s children, who were still at school in the early afternoon as he and others began packing for an unknown future.

    “They’re at school, and they have to come home to this, to no life,” Jennings said.

    Jennings was frustrated at what he believed was an attempt to force residents out in order to do something else with the property. Already, as he spoke, a man was performing work in the empty room next to him.

    “They want to take everybody out so they could remodel,” Jennings said.

Rent-Skimming Landlord Stiffs City Out Of $17K Water Bill; Subsequent Service Shutoff Forces Immediate Boot For Dozens Of Low-Income Tenants

In Newark, New Jersey, WABC-TV Channel 7 reports:
  • Dozens of people in Newark are without a place to live because their landlord hasn't paid his water bill. They say his negligence has trickled down to them, with the city evacuating the building.

    A few residents went into the building trying to gather any belongings they could carry. After being kicked out of the building on Monday [May 8], former residents are struggling to find another place to call home.

    "I have six kids and we live there, and we didn't get no notice, nothing at all," said former tenant Zelinet Alicea. "I pay my rent and I don't understand why."

    The building at 98 Clinton Avenue had a strong odor of urine and garbage as soon as you open the front door.

    Tenants say the landlord collected rent but never fixed the lock on the front door, allowing criminal activity to take place inside. The same situation was taking place in the attached apartment building on Thomas Street with the very same owner.

    "They went in, looked at the hallways how they were, and told everybody to get out," said former resident Jennett Nater.

    The mayor's office says the building had to be shuttered because the owner failed to pay an 'outstanding water bill of $17,000'.

    The building had been cited for numerous violations, including defective plumbing and raw waste in the basement. Tenants say the building had illegally cut up apartments inside.

    The mayor's office is trying to help residents find housing but adds, "The problem is that many people were squatters and had no rent receipts", and says "This was an illegal converson so all residents had to be evacuated."

    "And the way they did it, we had to go right away," said Alicea. "Just take what you got and go."

    There are two liens against the property with fines totalling some $300,000 [...].

Outfit That Says It Fights Homelessness Buys Interest In Apartment Complex, Then Promptly Gives Two Dozen Tenants The Boot

In Sandy Springs, Georgia, WGCL-TV Channel 46 reports:
  • Some tenants at a Sandy Springs apartment complex say they're being evicted by an organization that is supposed to help fight homelessness.

    24 tenants at the Reserve of Dunwoody condominium complex on Roberts Drive say they received an eviction notice on the front doors telling them they have two months to find a new place to live. The reason, the complex has been sold to someone else.

    The new owners of the complex are the Mary Hall Freedom House, an organization that has been fighting homelessness for the past 21 years. They specifically specialize in helping women who have been abused or have been through addiction find proper housing.

    The organization recently purchased 33 condominiums in the complex. CEO May Hall says the organization's goal is to find women transitional housing but in order to do so, they must evict the current renters to make that happen.

    "When we started thinking about sustainability we thought about we need to own our own place," said Hall. "There was a clause in their lease that said they could be given a 60 days notice to vacate and so we exercised that option."

    This was not good news for current resident Juan Woods. He says he was given no choice and must now find new housing before he becomes homeless.

    "They just basically said 'alright, we're the new owners. Thank you, goodbye," says Woods. "It's been a lot of a headache because it's taken me away from work it's taken me away from other activities."

    That irony isn't lost on Hall. She admits that displacing the current tenants is not a popular move. She does say that she is willing to help those in need.

    "I'm not trying to make nobody homeless especially a woman but anybody for that matter but again let's work to make it a win-win," said Hall.

    Hall tells CBS46 that she has already assisted one woman in finding a new place to live at the same complex.

Friday, June 02, 2017

After 5-Year Fight, 400 Low-Income Mobile Home Park Residents Dodge The Boot As County, City, Housing Authority Join To Buy Out Landlord For $40 Million; Earlier Plans To Sell To Developer Get Trash-Canned

In Palo Alto, California, The Mercury News reports:
  • Five years after the 400 residents of Buena Vista Mobile Home Park first heard that their homes were in jeopardy, officials announced Thursday [May 18] that a deal has been reached to preserve their rare Silicon Valley bastion of affordable housing.

    The deal will place the 4.5-acre park’s property in the hands of the Housing Authority of Santa Clara County, which partnered with Santa Clara County and the city of Palo Alto to make a $40 million offer to the Jisser family, which now owns the land.

    In 2012, the owners gave notice they intended to close the park and sell the land to a developer. Thursday’s news came as a tremendous relief to residents, who learned that years of uncertainty over the fate of their homes was over.
    Many of the residents knew that if they’d been forced to relocate, they’d likely end up someplace far away because they couldn’t afford the cost of housing in the Bay Area. Rents at the park range between $1,000 and $1,200 a month, well below the area’s median monthly apartment rent.
    The Jisser family had previously turned down an offer for $36 million — the appraised value of the of the land — but issued a statement that said they are “pleased we reached this settlement.”

    “(The settlement) will enable the families to stay here and also allow the housing authority to pursue the park’s renovation and upgrade,” the statement said.

    The family will retain a portion of the land that includes a retail pad and service station. Katherine Harasz, director of the housing authority, said that part was not included in the original appraisal. She said the family’s goals aligned with the county’s, and the price was agreed upon by taking the county’s appraisal into account as well as the Jissers’ opinion of the land’s value. Harasz said it was good to reach an amicable agreement: “We’re going to be neighbors.”

    Santa Clara County Supervisor Joe Simitian, who had long championed the effort to save the park, called it a “great, great day,” adding that the agreement preserves more than 100 units of “desperately needed affordable housing,” prevents evictions of low-income residents and gives the property owner a fair shake.
    Palo Alto Mayor Greg Scharff said the agreement provided “an extraordinary opportunity to preserve affordable housing for low-income residents, including at least 100 children.”
    Negotiations over the property’s value took four months. Thursday’s development avoided a more contentious course of action — exercising eminent domain if the family refused to sell.

    “It is important to note that the $40 million obviated the need for eminent domain,” Simitian said, “and now we have results sooner rather than later.”
    “I think it’s so important to know the role that the residents played,” Simitian said. “These are folks who have been living with the threat of eviction every day for the past five years, and yet they carried themselves with dignity and determination — it’s a wonderful outcome for them.”

    Under the agreement announced this week, the city and county put up $29 million in affordable housing funds to buy the site, with the remainder of the costs coming from the Housing Authority, which is using federal Department of Housing and Urban Development funds. Eshoo worked to get approval to use such funds for the mobile park. The acquisition is expected to be completed by early fall.
Source: $40 million purchase saves Palo Alto’s Buena Vista Mobile Home Park (Owners agree to sell for $40 million, meaning 400 low-income residents will be able to stay in their homes). lot-leasing homeowners

Rezoning Application May Be Tip-Off On Landlord's Decision To Close Mobile Home Park & Possibly Sell To Developer; Dozens Of Lot-Leasing Homeowners Given One Year To Pack Their Bags & Move Their Homes

In Aurora, Colorado, Colorado Public Radio reports:
  • Seen on a map, it’s clear why a developer would be interested in Denver Meadows Mobile Home and RV Park in north Aurora.

    The CU Anschutz Medical Campus and new VA Medical Center overlook the 20-acre property. A creek runs along the area until the waterway enters a nearby park. And the Colfax stop on RTD’s new R-Line is well within walking distance.

    The park’s owner, Shawn Lustigman, intends to close the park next June. That would affect around 100 families who live in Denver Meadows, which residents describe as a tight-knit community that’s relatively affordable.

    But residents say they are not giving up the park without a fight.
    Park managers have told residents they no longer wish to run the park and plan to retire. Residents don’t buy it. They think the closure is part of the owner’s plan to sell the park to a developer.

    Lustigman, a local businessman, also owns Berkeley Village Mobile Home Park in Arvada and A-1 Mobile Village in Colorado Springs as well as other parks around the country.

    In December of 2015, he applied to rezone to Denver Meadows to allow construction of high-rise apartments, new shops and hotels — but not mobile homes. Notices went up around Denver Meadows last spring. With the help of 9to5 Colorado, a local advocacy group, residents showed up en masse when Aurora’s zoning commission and city council considered the zoning decision.

    Last July, the council voted to table the request, citing poor relations between the management and residents. But the decision has not shifted plans to close the park.

    Lustigman declined multiple requests to comment for this story, but in a meeting recorded by residents, he was as clear as the eviction notices that have already been sent to residents.

    “The park is closing,” Lustigman said. “It doesn't make a difference. There’s really nothing you can do.”
    Denver Meadows residents thought they had their own answer, one that could set a precedent for the rest of Colorado. They would be the state’s first mobile home residents to collectively buy the park for themselves.

    Resident-owned communities have caught on in a number of states, especially New Hampshire. ROC USA, a nonprofit that organizes financing for residents to buy parks, now has around 200 parks across the country.

    Bailey Dotson, who works with Thistle Communities(1) and ROC USA, made a market-rate offer on the park on behalf of Denver Meadows residents. Dotson expected that after appraisal, the sale price could come to roughly between $15 and $18 million. He said that in a private meeting over a month ago, park owner Shawn Lustigman declined.

    He was very clear with me that they don’t intend to sell the park and close in 2018,” said Dotson.
    As the clock runs down, residents are turning to the City of Aurora in a final attempt to hold onto the park. The HOA and organizers plan to ask the City Council to deny the owner’s request to rezone. They hope to force Lustigman back to the table.

    Without a deal or new action for the city, residents will have to relocate their homes in just over a year.

    Resident Petra Bennett said the prospect is more difficult than people might imagine. Vacancies are scant in the metro area. Even if you find one, the cost to move a home generally runs between $5,000 and $10,000, according to the Corporation For Enterprise Development.

    In a walk across the park on a recent cloudy afternoon, Bennett pointed out a number of trailers that likely can’t be moved at all. Many were made before 1976 when the federal Department of Housing and Urban Development set standards for manufactured homes. Most parks refuse to accept pre-1976 structures.

    Beyond those practical limitations, Bennett can’t imagine letting go of her home tucked in a grove beside an overpass.

    “It’s cheaper living than a ‘house house,’ but it really is the same thing. You raise your family here. You make your memories here. You put all of your money and pride into these homes.”

    That’s clear from looking at her yard. With the help of her sons, Bennett dug ponds and lined them with berry bushes and fruit trees. She said the landscaping was a way to create an oasis in her backyard.

    And while she succeeded, it remains an oasis built on someone else’s land.
For the story, see The Denver Metro's Hunger For Housing Is Squeezing Mobile Home Parks.
(1) Thistle is a Boulder,Colorado-based non-profit organization dedicated to planning, development and management of affordable housing.

Long-Time Unresolved Public Health Issues With Aging Sewage Disposal System Forces Landlord To Shut Down Mobile Home Park; Lot-Leasing Homeowners To Get 13 Months To Move, Relocate Their Trailers; Non-Owning Renters To Be Out By June 30

In Easton, Maryland, The Star Democrat reports:
  • The owners of Talbot Trailer Park will close much of the mobile home facility, after the owners and local and state officials were unable to overcome financial and regulatory hurdles for the facility’s sewage disposal, the county council announced Friday [May 19] afternoon in a press release.

    The Talbot County Council said it had been informed by Norris E. Taylor Contractors Inc. (owners of the mobile home park) of its plan to close the majority of the park by June 30.

    Maryland Department of Environment (MDE) and local officials have been discussing options with the owners for bringing Talbot Trailer Park into compliance with state regulations concerning sewage disposal for some time, according to the county. While hoping a resolution could be found, local agencies have proactively developed a plan for how to best help residents relocate.

    “The council fully supports and will assist agencies with efforts underway in meeting the needs of the displaced residents and recognizes that this can be a very unsettling time for those involved,” Talbot County Council President Jennifer Williams said.

    Talbot Trailer Park includes 47 mobile homes, of which about 35 are occupied. Lorraine Claggett, chief operating officer for Norris E. Taylor Contractors Inc. has said Talbot Trailer Park will close by the end of June 2017, according to the county. Those residents of the park owning their own mobile home units, by law, have longer to make alternative living arrangements and have been told to remove their units from the premises by midnight June 30, 2018.

    Since the 1980s, the trailer park has been operating with an interim wastewater treatment system that has consisted of minimal biological treatment discharging septic tank effluent to a bermed infiltration pond. MDE has been working with the owners of the mobile home park for a considerable length of time trying to develop a solution to an on-going public health issue associated with the wastewater disposal system that serves Talbot Trailer Park.

    In the past five years, MDE has attempted to work with the owners of the park to develop a new wastewater treatment strategy; however, the measures that have been put into place have failed to comply with the effluent limits outlined in the facility’s discharge permit, according to the county. In the past twelve months, there have been discussions with the trailer park owners, as well as representatives from MDE, the Town of Easton, Talbot County Health Department and Talbot County government that have ranged from installing denitrifying treatment units to extending public sewer, but economics and maintaining regulatory environmental compliance have presented challenges to all the parties involved that have not been able to be overcome. The owners of the mobile home park have therefore decided to discontinue operation of the mobile home park.

    In an effort to provide assistance to the residents of the mobile home park, Dr. Fredia Wadley, health officer for Talbot County Health Department, has been meeting with Linda Webb, director of the Talbot County Department of Social Services, and Marilyn Neal, executive director of the Neighborhood Service Center, to assess housing needs for the residents.

    This includes identifying and cataloguing available rental properties and housing resources in Talbot and surrounding counties and informing residents of short term rental assistance available to them. Talbot County has worked to be a partner in attempting to develop solutions associated with Talbot Trailer Park.

    “The Talbot County Health Department and Department of Social Services began planning how we might assist residents of the trailer park when we received confirmation of the closure of the mobile home park,” Dr. Wadley said. “We stand ready to assist the residents, recognizing that relocating is never easy when low income housing is needed as part of the solution.”

    Residents are encouraged to contact the Talbot County Department of Social Services at 410-770-4848 for assistance.

Thursday, June 01, 2017

South Florida Man Gets Pinched For Allegedly Pocketing Over $43K By Running 'Leaseback' Racket, Persuading Three Financially Homeowners To Sign Over Their Homes To His Trust; Scheme Purported To Wipe Out Mortgages After 3 To 5 Years Using Forensic Loan Audits

In Fort Lauderdale, Florida, the South Florida Sun Sentinel reports:
  • A Tamarac man scammed tens of thousands of dollars from three homeowners who were falling behind on their monthly payments during the mortgage crisis, investigators say.

    Michael Anthony Haynes persuaded is accused of persuading the homeowners to donate their homes to a “trust” he ran and then pay him rent. In turn, he would get them their homes “free and clear” after three to five years, according to a Broward Sheriff’s arrest report.

    Instead, Haynes, 52, made off with more than $43,000 of the homeowners’ money, the report said.

    The plot started taking shape in 2012, according to the report.

    Investigators say Haynes told the three homeowners that he ran the Michael Anthony Haynes Charitable Remains Trust IRA Corporation. Haynes told them to stop paying their mortgages and ignore any notices from their banks about foreclosure. He promised he would take care of everything, according to the report.

    Besides paying him rent, Haynes also got the homeowners to pay him $1,500 to $2,000 for “forensic reports” on their mortgages.

    But after two to three years of rent payments, two of the victims had their banks foreclose their homes. The third homeowner managed to get their deed back from Haynes with the help of a lawyer, but still had to deal with a foreclosure, investigators said.

    It’s unclear how Haynes was eventually tracked down, but he was taken into custody Tuesday [May 16] in another state and brought back to Broward County. He was booked into jail on three counts of grand theft and released Friday on bonds totaling $30,000.

S. California Gets Bagged For Allegedly Masquerading As A Lawyer To Fleece Over $45K From Three Couples In Loan Modification & Debt Consolidation Scam

From the Office of the Orange County, California District Attorney:
  • A man was arraigned yesterday [May 17] for impersonating an attorney and defrauding several clients through debt consolidation and mortgage modification schemes.
    Circumstances of the Case:

    Between December 2013 and July 2015, [James Frank] Barker is accused of posing as an attorney under several different aliases and law firm names.

    Barker is accused of soliciting clients by promising to consolidate outstanding debts and/or reduce mortgage payments through loan modifications.

    Between November 2013 and July 2015, the defendant is accused of collecting $20,960 from his clients, John Doe 1 and Jane Doe 1, $3,000 from John Doe 2 and Jane Doe 2, and $21,640 from John Doe 3 and Jane Doe 3.

    The defendant is further accused of never notifying his clients’ debtors of his representation, never attempting to negotiate any debts on behalf of his clients, and never submitting any mortgage assistance applications on behalf of his clients.

    Barker is accused of refusing to refund his clients and laundering the money at a JPMorgan Chase bank.

    On Dec. 7, 2015, the Orange County District Attorney’s Office (OCDA) received a tip from an attorney in Orange County who represented two of Barker’s victims.

    OCDA investigated this case and discovered that Barker has never been a licensed member of the State Bar of California.

    Newport Beach Police Department arrested Barker on May 15, 2017.

Wednesday, May 31, 2017

Bail Set At $300K For Ex-Social Services Director Of Retirement Center Pinched & Charged With Fleecing $391K From Elderly Residents; Suspect's Alleged Bad Acts Include Abusing POA To Purloin Sale Proceeds Of One Victim's Home

From the Office of the Louisiana Attorney General:
  • Attorney General Jeff Landry's Louisiana Department of Justice, with the assistance of the Minden Police Department and the Bienville Parish Sheriff’s Office, has arrested a Minden woman for stealing approximately $391,000 from residents of Leslie Lakes Retirement Center (LLRC) in Arcadia.

    Stephanie Sanders Hays, 49 of Minden, was arrested on 15 counts of Theft of the Assets of a Person who is Aged or Person with a Disability, 19 counts of Money Laundering, 17 counts of Forgery, and 17 counts of Exploitation of Persons with Infirmities. Hays allegedly executed several schemes from September 2012 through February 2016 in order to gain access to the financial assets of at least one resident of LLRC, where Hays worked as a Social Services Director.

    Hays allegedly abused her Power of Attorney authority over the affairs of a resident – draining a bank account, IRAs, annuity plan, and proceeds from the sale of the resident’s home. She also allegedly shopped for items requested by the residents at local Walmart stores with forged retirement center checks. A portion of the funds allegedly stolen included Social Security payments, pension payments, and German reparation payments.

    “Our office fights daily to protect our State’s seniors and sick. Criminals preying on Louisiana’s most vulnerable will be investigated, apprehended, and prosecuted,” said General Landry. “It is a disgusting travesty for the elderly, especially Holocaust survivors, to be scammed and robbed by those supposedly caring for them. I hope to get justice for our victims very soon.”

    Hays was arrested without incident after investigators located her in a pharmacy parking lot in Minden. Minden Police transported Hays to the Webster Parish Jail, where she was then extradited to Bienville Parish. Hays’ bail was set at $300,000.
Source: Minden Woman Arrested for Stealing Nearly $400k from Elderly Residents (Former Social Services Director Charged with 68 Counts of Criminal Violations).

Prosecutor Accepts 'Sloppy Recordkeeping' Defense, Drops Criminal Charges Against Nephew Accused Of Abusing POA To Obtain $1.1 Million Reverse Mortgage On Widowed, Dementia-Stricken Aunt's Home & Fleece Estate Of Nearly $640K; Defendant Allowed To 'Buy-Out' Of Prosecution w/ E-Z Pay "Civil Agreement" To Cough Up $140K To Estate w/ $10K Upfront, $3K/Month

In Lehigh County, Pennsylvania, The Morning Call reports:
  • All charges were dismissed Monday [May 22] against an Allentown man accused last year of "plundering" his aunt's estate of nearly $640,000.

    Bernard Daday, 58, instead entered into a civil agreement with Lehigh County prosecutors to pay back $140,000 to the estate of Helen Sipes, widow of Dr. Earl K. Sipes, chief of surgery at Sacred Heart Hospital. The couple, who didn't have children, left the bulk of their estate to several charities in the Lehigh Valley.

    The estate was worth $1.8 million when Earl Sipes died in 1998. Helen Sipes died in 2012.

    Chief Deputy District Attorney Charles Gallagher said an investigation showed that most of the expenditures Daday made were "appropriate," but that his record keeping was "sloppy."

    Daday, who became his aunt's power of attorney in 2004, paid $10,000 Monday and agreed to pay $3,000 a month until the money was returned.

    "If he fails to make a payment the charges can be reinstated," Gallagher said.

    After a grand jury investigation, Daday was charged in January 2016 with theft by deception, receiving stolen property, theft by unlawful taking or disposition and dealing in proceeds of unlawful activities.

    The charges came to light when family members questioned a $1.1 million reverse mortgage Daday had taken out on the Sipeses' Salisbury Township home. Helen Sipes taxes had not been filed or paid since 2007, according to an affidavit of probable cause filed at the time of Daday's arrest.

    Daday did not testify during a brief hearing before Judge Maria L. Dantos.
Source: Charges dismissed in $640,000 theft case involving aunt's estate.

For earlier post, see Nephew Hit w/ Felony Charges For Allegedly Pilfering Nearly $640K From His 83-Year Old, Widowed, Dementia-Stricken Aunt (Use Of POA To Obtain $1.1 Million Reverse Mortgage On Victim's Home Among Alleged Bad Acts).

After Week-Long Trial, Jury Takes Less Than Three Hours To Slam Guilty Verdict On Massachusetts Man For Duping Elderly, Mentally Incapacitated Neighbor Into Signing Over Her Home To Him As She Lay On Her Deathbed; Defendant Dodges Jail Time, Must Pay $2,500 Fine & Relinquish Title To Swindled House

In Lowell, Massachusetts, the Lowell Sun reports:
  • Former Lowell Building Inspector David St. Hilaire knew his elderly neighbor was mentally incapacitated when he got her to sign her home over to him as she lay on her deathbed in 2010, a jury determined on Monday [May 22].

    St. Hilaire was found guilty of larceny over $250 from an elderly person following a weeklong jury trial in Woburn Superior Court. Judge Bruce Henry scheduled sentencing for Thursday at 2 p.m.

    St. Hilaire was convicted of the same charge in 2012 following a bench trial, but the Supreme Judicial Court overturned that conviction in 2015 when it ruled the judge in the case erred by not requiring proof that St. Hilaire knew his neighbor was incapacitated.

    The jury spent less than three hours deliberating after a retrial this week.

    St. Hilaire got his longtime neighbor, Erika Magill, to sign her property at 205 Billerica St., over to him on July 26, 2010, as she was critically ill in a nursing home.

    St. Hilaire said Magill agreed to let him have the property in exchange for two mortgages totaling about $92,000, and for a "life estate" that let her live in the home until her death.

    Magill died about two weeks later, and never saw a penny of the promised payments.

    Two weeks before she signed the property over to St. Hilaire, Magill had her attorney, state Sen. Eileen Donoghue, update her will to make longtime friend and caretaker Lisa Miele the sole beneficiary of the property.

    Assistant District Attorney Heidi Gosule said Magill, before she fell ill, told several friends that St. Hilaire had always wanted her property, but that "no way in hell was he ever getting it."
    [G]osule said Magill's condition quickly deteriorated in the days before she signed St. Hilaire's paperwork.

    "I would suggest it would have been obvious to a stranger that Erika Magill was not competent to consent, and the defendant was there twice a day," Gosule said. "Of course he knew she wasn't competent. Of course he knew she couldn't consent."

    Gosule suggested the jury should disregard St. Hilaire's statement to police in which he said Magill had "never looked better" than she had on the 26th.

    She said Magill was suffering from a major infection at the time, and called it "outrageous" that St. Hilaire could have thought she never looked better.

    "All you have to do is use your common sense and everyday experience to know that he's lying. He's lying because he knew what he was doing," Gosule said. "What the defendant did is outrageous. What he wants you to believe is outrageous."
Source: Ex-Lowell building inspector guilty of bilking dying woman of her home.

For story update, see Ex-Lowell building inspector fined $2,500, must turn over house in larceny case:
  • Longtime friends of the late Erika Magill said Magill will finally be able to rest in peace now that her Billerica Street home will be conveyed to the caretaker she left it to in her will.
    Hilaire took advantage of Magill's incapacitation when he got her to sign paperwork giving him the home in exchange for $92,000 and a life estate that allowed her to live in the home until her death. Prosecutors said the deal included a clause that said payments for the home would continue only until Magill's death. She died without having ever received a single penny.

    St. Hilaire was convicted of larceny in connection with the case in 2012, and was ordered to convey the home to Miele, to serve two years of probation and to pay a $2,500 fine.

Problems Dealing With Dubious Deeds Not Limited To Urban, Big City Recording Officials

In Branch County, Michigan (pop. approx. 45,000), WTVB Radio 1590 AM reports:
  • Elder abuse remains a growing problem and it might surprise you where evidence of the increased number of cases can be found. Branch County Register of Deeds Nancy Hutchins says there is a lot of fraud happening with deeds being filed after an unsuspecting mother or father, for example, turns over a piece of property to a relative under false pretenses.

    According to Hutchins, there is nothing her office can do to prevent, in her words, “some shyster” from coercing a relative to deed over, say, a family farm. She also said it can get interesting when someone passes away and the children all show up to record questionable documents.

    Hutchins, who is a member of the Coldwater Sunrise Rotary Club, told the group last week that she and her staff are always on the lookout for customers that try to pass off a tale or two that clearly raise doubts about their authenticity. She quipped they can always tell when there is a full moon just by the people that come in to their office at the Courthouse Annex on Pearl Street, the questions they ask and the stories they want to share.

Tuesday, May 30, 2017

Struggling Homebuilder Leaves Customers Up In The Air On Unfinished Houses; One Victim Says She's Out Almost $250K In Deposits, Left Holding The Bag On $200K Construction Loan, & Still Faces Foreclosures By Stiffed Subs On Unpaid Mechanics Liens; Cops Offer No Help, Say 'It's A Civil Matter'

In Medford, Oregon, KTVL-TV Channel 10 reports:
  • Sheana Wilkinson signed papers with Whittle Construction last February.

    Almost one year later, the owner told her in January he would not be able to finish the house. Wilkinson said she had saved for 13 years, and lost almost $250,000 in deposits. Soon after, her family became responsible for the construction company's loan of $200,000.

    "We were contacted by the bank in January that if we didn't assume the loan that our home was going to be foreclosed on. So in desperation to save the house we signed the papers," said Wilkinson.

    The homeowner began working with an attorney after police told her they would not be able to help.

    "He said that it's a civil matter(1) so that has to be resolved through circuit court which just means attorney fees for us and we're already more than $10,000 in attorney fees just fighting for the position that we're at right now," said Wilkinson.

    Right next door, Steve O'Neill is involved in a lawsuit with the construction company. O'Neill said this follows the owner not properly measuring the property boundary line.

    "This is a guy that had professionally built hundreds of houses. And to be so off... not just inches but four, five, six feet on varying parts of the boundary... it's ridiculous," said Steve O'Neill.

    Wilkinson said she's saving her attorney costs to fight more than $80,000 in lien fees.

    "One subcontractor has already started the foreclosure process on us. We got another intent for foreclosure from another subcontractor. And it's like...I understand that we all lost something. But they're trying to take my home away from me," she said.

    If you're interested in helping the family's GoFundMe just go to: You can also reach Sheana at 541-821-5634.
Source: Families across Medford say they've been affected by Whittle Construction challenges.

In a related story, see Whittle Construction contracting license suspended, leaving families with unfinished homes.
(1) A basis for the crime of theft by failure to make required disposition of funds (or similar crime) may exist if an investigation would reveal that the homebuilder pocketed money specifically intended for the construction of one home, and diverted it to either:
  • an unrelated construction job or project, or
  • the builder's operating expenses, or
  • personal expenditures.
If the police summarily dismissed this case as a civil matter without first conducting an investigation, chances are that the police (and/or the local prosecutor's office) either:
  • don't have the resources needed to handle this case, or
  • lack the expertise necessary to be alert to the possibility of a theft crime occurring in the context of a business contract, or
  • are just clueless and are using it as an excuse to get rid of the person making the complaint.
Go here for links to examples of theft by failure to make required disposition of funds in the context of construction/home improvement contracting.

Another Sale Of Vacant Foreclosed Home Hits Snag As Squatter Hijacks Title, Possession Of House With Dubious Deed Shortly After Prospective Buyer Enters Purchase Contract

In Atlanta, Georgia, WSB-TV Channel 2 reports:
  • An Atlanta home buyer’s purchase is at a standstill while the courts decide whether squatters have occupied her new home.

    The woman told Channel 2’s Nicole Carr that she does not want to be identified for safety reasons. Just two weeks ago she put earnest money down during an offer on a Southwest Atlanta home. She’d made three visits to the move-in ready house on Hayward Place. Photos show it was freshly painted with new carpet and no appliances.

    The day after the offer was submitted, a realtor discovered the "For Sale" sign was missing, and a "No Trespassing" sign was in the window alongside a quitclaim. A man is telling Fulton County the home was gifted to him by a relative.

    “The selling agent went to the house on Friday, had the locks changed and said to my agent, ‘Okay we’re set to go,'” recalled the home buyer. “'We can have the appraiser out there on Monday and she can do her inspection Tuesday.’”

    When the selling agent and appraiser returned this week, they said a man answered the door. Three children were behind him. He claimed to be a renter.

    “It’s just wrong, and I don’t want him to get away with this with anybody else,” the home buyer said.

    Carr looked up property records showing the bank-owned home went into foreclosure in October 2016 and remains that way. The seller’s agency keeps the utilities on, and the postal service confirmed it's not authorized to deliver mail there because its record shows the home is unoccupied.

    No one answered the door during Carr’s two visits to the home Thursday afternoon, but a deputy had been there earlier. He served the occupants and the man claiming to own the home with a summons for illegal occupancy. They must report to the courts within seven days to prove they have the right to be in the home.

    Deborah Jennings is a Heyward Place neighbor who said there’s been high traffic in the home for the past month.

    “It’s never a group of people, and it’s never the same person,” Jennings told Carr. “It’s always one at a time…just men. All men, and the cars have been black. Like six different cars in and out.”

    The home buyer said she’s filed a complaint with Fannie Mae and is awaiting the court’s decision.

    “I don’t know. I’m really thinking about stepping out of this,“ she said.

Crackpot Squatter With History Of Being A Housing Deadbeat Moves Into Vacant Foreclosed House Shortly Before Scheduled Sale, Snagging Title Closing For Soon-To-Be Homebuying Family

In San Marcos, California, KGTV-TV Channel 10 reports:
  • A group of people moved into a North County home and say they don’t plan on leaving unless the court tells them to.

    The problem is that the bank servicing the loan says they don’t have permission to be there.

    According to people in the neighborhood, the house was a foreclosure and empty.

    The woman who moved in told Team 10 she blamed the situation on the bank and went as far as to put up fliers to neighbors reading, “There is a civil action pending in court in regards to true ownership of the property going through legal channels.”

    Julie Frisino is living at the San Marcos house, but she’s not a renter, and she’s not the owner. Team 10 investigator Adam Racusin asked Frisino how long she’s going to stay at the house. “We have a court date,” Frisino responded.

    While Frisino waits for the legal system to play out, someone else was hoping to already be in the house.

    “We found a property that sort of satisfied all the criteria that we put together,” said John Masnica.

    Masnica was hoping to move his family in last month. He and his wife have three kids, a fourth on the way. For him, the house was the perfect location and perfect price.

    The only problem was that Frisino moved into the vacant house about a month before Masnica could close escrow.

    “Someone is living in what’s supposed to be our house,” he said. Masnica told Team 10 the house is a foreclosure. The bank put it on the market late last year and accepted his offer to buy it in November.

    He says it took a few months to work out all of the details, such as who would take care of some small construction repairs. He thought things would be wrapped up by April.

    "The listing agent went over there with a contractor to begin the work when they realized squatters had taken possession of the property,” Masnica said.

    According to Masnica, while the house was sitting empty, Frisino moved in.

    She started living there and filed a legal action against the bank, and what looks like the original owners and others.

    It claims in part, “Prior to 2017, said predecessors in interest, intentionally, willfully and permanently, abandoned their title and possession of subject property by permanently vacating subject premises and relinquishing all rights, title and interest in and to subject property.”

    It later states, “Plaintiffs allege that the act of permanent abandonment of subject property by the original owner and the subsequent act of actual physical possession of said premises by plaintiffs, results in a transfer of the ownership interest in, and the title and possession to, subject property to the plaintiffs.”
    According to court records, this isn’t the first time Frisino’s had a problem paying for where she’s lived.

    Documents show a handful of unlawful detainer cases, which are basically eviction lawsuits. The most recent filed just last year.

    One of those landlords told Team 10 that Frisino paid for a couple of months and then the rent stopped, and excuses started.

Monday, May 29, 2017

After Over A Decade Of Gov't Scrutiny & Victims' Civil Suits, Chicago Feds Finally Put The Pinch On Sleazy Home Improvement Operator For Allegedly Using False Home Repair Promises, Proceeds From Reverse Mortgages To Screw At Least 122 Elderly Homeowners Out Of $10 Million In Home Equity

In Chicago, Illinois, the Chicago Tribune reports:
  • The Federal Trade Commission filed a civil suit against him in 2003. The Illinois Department of Financial and Professional Regulation suspended his loan originator registration in 2010.

    But it took until Mark Steven Diamond - who also went by the name Mark Stevens - was accused of stealing a total of $10 million of equity in the homes of at least 122 elderly victims before he was arrested on Monday [May 22] and, on Tuesday, upon appearing in federal court, was charged in connection with wire fraud and engaging in a financial scheme, according to FBI Special Agent Garrett Croon, a media coordinator for Chicago.

    “Diamond caused certain elderly homeowners to execute reverse mortgage loan documents, despite the fact that they were disabled or otherwise unable to understand the reverse mortgage loan documents,” said Kelly Popovits, a special agent with the United States Department of Housing and Urban Development, Office of Inspector General.

    Diamond, 60 and of Chicago, is suspected of working with at least five co-conspirators, officials said, defrauding seniors by fraudulently obtaining home loans in their names and keeping the profits.

    A judge determined Tuesday that he is to be held until his next hearing, investigators said.

    “Diamond knowingly participated in a mortgage fraud scheme by using a name and registration number belonging to another loan originator for compensation or gain due to the fact that Diamond’s registration was expired,” Popovits wrote in an affidavit meant to establish probable cause to arrest Diamond.

    The main focus of the investigation was into reverse mortgages, Popovits wrote, as she explained what they are and who is eligible.

    “A reverse mortgage loan is available to homeowners age 62 or older and allows the homeowner to borrow the equity in their home minus fees and costs. It may only be secured by a primary residence for which all title holders are borrowers and are age 62 or over. To be eligible, borrowers must receive reverse mortgage counseling explaining the fees, costs, and ramifications of getting a reverse mortgage. Reverse mortgage payouts can be in the form of a line of credit or lump sum, with limits on the size of the lump sum payout,” she wrote.

    To circumvent rules limiting reverse mortgage lump sum payouts, investigators said, Diamond falsely represented to the reverse mortgage lenders that he had already made the promised home repairs and was entitled to be paid directly by the reverse mortgage lender, including by preparing loan applications which falsely represented that a fictitious entity was a creditor of the elderly homeowner, filing false liens against the elderly victims’ homes, and submitting false payoff letters, according to the 72-page affidavit.

    The victims of the scheme mainly were seniors on Chicago's West Side, officials said.

    The investigation involved: “Reviewing records, including records of victims, reverse mortgage lenders, title companies, the Cook County Recorder of Deeds, numerous financial institutions, the Federal Reserve, telephone companies, the Secretary of State of (both) Illinois and Indiana, the Illinois Department of Financial & Professional Regulation and HUD, as well as documents, including affidavits of victims, filed in civil suits against Diamond,” Popovits wrote.

    She added that the oldest victim was 98 and outlined the way he is alleged to have carried out the scheme. Authorities said Diamond:
  • Falsely promised elderly homeowners that he would make certain home repairs. The type and cost of the home repairs that he falsely promised to make were a function of the amount of equity that he calculated would be available in the form of a payout from a reverse mortgage loan secured by the victims’ homes. The greater the equity available to the elderly homeowner, the more repairs he would falsely promise to make and the more he would charge.
  • Falsely represented that he had been sent by the city and that the home repairs would not cost the elderly homeowner any money, such as by falsely promising that the repairs would be paid for through a government program, including a “free Chicago porch repair program.”
  • Falsely represented to the elderly homeowners that they needed to sign certain documents to start the repair work and caused them to do so without the elderly homeowners knowing that they were obtaining a reverse mortgage loan.
  • On occasions in which family members were opposed to the elderly homeowner dealing with him or obtaining a reverse mortgage loan, he would return to the home to speak to the elderly homeowner at a time when the opposing family members were not present.
  • Caused the reverse mortgage counseling to be conducted over the telephone and then participated in the counseling by coaching or posing as the elderly homeowner or causing others to pose as the elderly homeowner.

One-Year Probe Leads To Arrest Of Hubby & Wife Who Once Served As Condo Association President & Treasurer For Allegedly Filching Approx. $134K From HOA's Coffers; Defendants Also Face Lien Foreclosure For Failure To Pay Periodic Dues

In Bradenton Beach, Florida, The Anna Maria Islander reports:
  • A former president and treasurer of Gulf Reach Condominium Association in Bradenton Beach have been charged with defrauding the Florida not-for-profit corporation of more than $50,000 over a six-year period.

    The association address is 1303 Gulf Drive S.

    Alyson Colosia, 51, and Javier Colosia, 53, who also own a condo in the 1300 block of Gulf Drive North, were arrested May 3 and charged with the first-degree felony.

    The couple pleaded not guilty May 9 in 12th Circuit Court, posted $20,000 bond and were released that day from the Manatee County jail.

    Their ability to post bond was delayed by the court to ensure none of it came from a nefarious source. A court investigation into the bond money showed a parent provided the funds.

    According to police and court records, the couple made about $134,000 in unauthorized ATM cash withdrawals and other transfers between January 2009 and August 2015.

    The alleged fraud was revealed by new leadership of the condo association in March 2016.

    The three-unit association installed a new board Aug. 8, 2015, and its new president, Alan Gary, reported the alleged theft to the Bradenton Beach Police Department in March 2016.

    Gary said he attempted to obtain the financial records from the Colosias, who had controlled the association’s finances since its inception in 2004, but they refused, and the board commissioned an audit.

    Gary went to police with the audit and annual financial statements prepared by the Colosias.

    According to the police report, the Colosias failed to pay association dues and pocketed money acquired from renting vacant units without authorization.

    The couple allegedly skimmed $500 a day from the association bank account for about six weeks.

    Transfers from the account also went to a company the couple owned and managed, according to a BBPD report.

    The state and BBPD spent a year investigating the couple before making their arrests, Gary said.

    The association has filed a foreclosure against Colosias’ unit for their failure to pay dues.

Fannie Mae Joins Battle Against Rent-To-Own, Contract For Deed/Land Contract Rackets; Says It No Longer Sells Foreclosed REOs To Nationwide Outfit Accused Of Using Abusive Deals To Dupe Naive Aspiring Homeowners Into Buying Dilapidated Money Pits

The New York Times reports:
  • One of the biggest firms in the rent-to-own home business is now on the federal government’s do-not-sell list.

    Fannie Mae, the government-controlled mortgage finance giant, said on Tuesday [May 23] that it had stopped selling properties to the firm, Vision Property Management, after conducting a review of the firm’s rent-to-own program, which operates in more than a dozen states.

    The mortgage finance company will also impose restrictions on future sales of foreclosed homes to firms that engage in abusive forms of seller financing — which includes selling homes on either rent-to-own leases or in long-term installment agreements known as contract for deed.

    The policy change by Fannie could put a big crimp in the business model of certain investment firms that have sprouted up since the financial crisis. These firms buy foreclosed homes on the cheap and sell them to people unable to qualify for a conventional mortgage.

    A series of articles in The New York Times last year detailed abuses with rent-to-own leases and contract for deed sales. The articles illustrated how people across the country were being duped by the promise of owning a home without realizing the hidden cost of repairs and sometimes overdue fines owed to municipalities.

    Housing advocates have criticized the seller-financed business for fostering abusive practices that take advantage of poor people and contribute to neighborhood blight.
    Vision has come under scrutiny in recent months for what regulators and senators have called its predatory lending practices in real estate. The South Carolina firm bought thousands of foreclosed homes from the government, turning around and reselling these often rundown homes “as is” to aspiring homeowners.

    In a pattern first reported in The Times, Vision and other firms often spend no money on renovating the foreclosed homes, putting the onus on the tenants to bring the property up to code or lose their contract. In several cases where lead paint was present in a property, Vision failed to disclose the hazard, [...].

Sunday, May 28, 2017

Disciplinary Actions Against Attorneys Purloining Or Otherwise Misusing Ten$ Of Thousand$ In Client Funds Keep Illinois State Bar Busy

The Illinois State Bar Association recently announced that the state Supreme Court disbarred 7 attorneys, suspended 9 others in a latest disciplinary filing.

The following three lawyers were disbarred for, among other things in some cases, playing fast and loose with their clients' money:
  • Francis Joseph Coyle, Jr., Rock Island
    Mr. Coyle, who was licensed in 1974, was disbarred. He intentionally misappropriated $100,000 in funds that he was supposed to be holding in escrow in connection with a real estate transaction. In addition, on two occasions, he falsely represented to the buyer’s attorney that he was still holding all of the funds in escrow.

    Laird James Heal, Sterling, Massachusetts
    Heal was licensed in Massachusetts in 1989 and in Illinois in 1991. The Supreme Judicial Court for the Commonwealth of Massachusetts disbarred him for misusing over $13,000 of funds held in escrow in connection with a bankruptcy case. The Supreme Court of Illinois imposed reciprocal discipline and disbarred him.

    Richard Carl Moenning, Chicago
    Mr. Moenning, who was licensed in 1962, was disbarred. While serving as both trustee and trust counsel to several trusts created by two elderly sisters, he paid himself over $360,000 in purported fees without performing sufficient services to justify the payment of the funds. He also took years to notify or pay some of the trust beneficiaries, failed to disburse any funds to one beneficiary as of the time of the disciplinary hearing, failed to timely notify some of the beneficiaries of their interests under the trusts, and never provided an accounting to any of the beneficiaries or to the Illinois Attorney General’s Office. He was suspended on an interim basis on June 15, 2016.
In addition, the following five attorneys had their licenses suspended for varying periods of time for playing fast and loose with money belonging to their clients:
  • William James Meacham, Edwardsville
    Mr. Meacham, who was licensed in 1989, was suspended on an interim basis and until further order of the Court. An ARDC hearing panel earlier recommended that he be disbarred for knowingly misappropriating $32,083 of a client’s personal injury settlement funds. In addition, he told a lien holder that he did not know what had happened to the money and then created false receipts falsely purporting to show that he had distributed most of the funds to the client.

    Baltazar Mendoza, Chicago
    Mr. Mendoza, who was licensed in 2001, was suspended on an interim basis and until further order of the Court. The ARDC was investigating allegations that he had misappropriated more than more than $243,000 from several different clients and neglected a client’s matter and made misrepresentations to the client regarding the status of that matter.

    Jay Lawrence Miller, Barrington
    Mr. Miller, who was licensed in 1967, was suspended for one year and until he completes the ARDC Professionalism Seminar. In three separate matters, he converted a total of approximately $85,000 in funds belonging to clients or third parties during a time when he was having financial difficulties. The suspension is effective on June 8, 2017.

    Dennis Brian Porick, Joliet
    Mr. Porick, who was licensed in 1982, was suspended for eighteen months. He converted over $10,000 belonging to three separate clients whom he represented in collection matters. He also endorsed two of his clients’ names to checks he received on their behalf without the clients’ authorization. The suspension is effective on June 8, 2017.

    Diane Marie Wilkins, Chicago
    Ms. Wilkins, who was licensed in 1999, was suspended from the practice of law for two years and until further order of the Court. She misappropriated $21,648.55 from a client and made false statements to the ARDC during the course of the disciplinary investigation.
Finally, the following attorney was censured for apparently losing track of exactly for whom he was holding escrow money:
  • Karlo Michael Karacic, Chicago
    Mr. Karacic, who was licensed in 1987, was censured. While representing the sellers in a residential real estate transaction, he failed to preserve the identity of $1,137 in escrow funds that his firm had agreed to hold.
Source: Illinois Supreme Court Disbars Seven, Suspends Nine, Reprimands Three, Censures Three.

Editor's Note: The Client Protection Program of the Attorney Registration and Disciplinary Commission (ARDC) was established by the Supreme Court of Illinois to provide reimbursement to clients who have lost money or property because of dishonest conduct by lawyers admitted to practice law in the State of Illinois. The Program reimburses clients who cannot get reimbursement from the lawyers who caused their losses, or from other sources such as insurance. (But see Stolen Inheritances: I-Team lawyer warning, in which one Illinois victim said of the program, "Their rules are vague, ambiguous and they are applied at their own discretion, and you can't get a straight answer[.]")

For similar "attorney ripoff reimbursement funds" that sometimes help cover the financial mess created by the dishonest conduct of lawyers licensed in other states and Canada, see:
Maps available courtesy of The National Client Protection Organization, Inc.

Lawyer Who Dodged Bar Boot By Voluntarily Relinquishing Law License In Advance Gets 3 Years Prison Time For Filching Over $950K From Terminally Ill & Dead Clients (& Their Heirs) In Estate Settlements & Real Property Transactions; Prosecutor: Attorney's Actions "Fractured Families", "Leaving [Victims'] Children To Sort Thru Financial Wreckage After Their Parents' Death"

In Bridgeport, Connecticut, the Connecticut Law Tribune reports:
  • A former Fairfield attorney who defrauded clients of more than $950,000 was sentenced in federal court Monday [May 8] to three years in prison with three years of supervised release.(1)

    According to documents provided by the U.S. attorney for Connecticut, 53-year-old John O'Brien admitted to defrauding clients between April 2011 and June 2014 by using funds from one client to pay off debts owed to others. In one instance, O'Brien used $31,000 in client funds to pay his son's tuition to a private high school, according to court documents.

    O'Brien, who resigned from the Connecticut bar in June 2015, pleaded guilty to one count of wire fraud in December.

    Chief U.S. District Judge Janet C. Hall ordered the government to submit a proposed restitution order within two weeks while sentencing O'Brien.

    In the government's sentencing memorandum, the U.S. attorney for Connecticut said O'Brien "preyed" on his victims. Federal prosecutors asked for 41-51 months in prison.

    O'Brien "exploited his role as an attorney to steal nearly $1 million from clients who entrusted their life savings to him and relied upon him to conduct business transactions in a timely and ethical manner," according to the memorandum.

    The memo continues, "He preyed on these unsuspecting victims, draining the estates of three elderly clients and leaving their children to sort through financial wreckage after their parents' death. The emotional fallout from O'Brien's actions has fractured families and caused unnecessary hardship to the heirs of the estates."

    The bulk of the fraud was perpetrated against an individual who lost more than $700,000.

    According to the government, O'Brien accepted $467,248 in his Interest on Lawyers' Trust Account (ILOTA) as proceeds of a reverse mortgage taken by the client and his wife, both of whom are now deceased. The reverse mortgage funds were intended to pay debts associated with the client's family business, but O'Brien only dispersed $204,000 between June 2012 and February 2014.

    In addition, O'Brien received $194,636 in July 2013 from bank accounts held in the name of his client and one of his client's children, but only $104,008 was distributed. And, in April 2014, O'Brien accepted $837,250 into his IOLTA fund as proceeds of a sale of his client's property, but only $470,000 was disbursed.

    In another case, O'Brien deposited $74,250 from a client into his IOLTA fund, but the money was never disbursed, according to the government.

    O'Brien targeted four families in total, the government said.
Source: Attorney Gets Prison Sentence for Bilking Clients of Nearly $1M (may require subscription; if no subscription, TRY HERE, then click appropriate link for the story).

For the U.S. Attorney press release, see Former Attorney Sentenced to 3 Years in Prison for Defrauding Clients of More Than $900K.
(1) In Connecticut, the Client Security Fund is a fund established by the rules of the Connecticut Superior Court to provide reimbursement to individuals who have lost money or property as a result of the dishonest conduct of an attorney practicing law in the State of Connecticut, in the course of the attorney-client relationship. The fund provides a remedy for clients who are unable to obtain reimbursement for their loss from any other source.

For similar "attorney ripoff reimbursement funds" that sometimes help cover the financial mess created by the dishonest conduct of lawyers licensed in other states and Canada, see:
Maps available courtesy of The National Client Protection Organization, Inc.

Bail Set At $195K For Suspended Lawyer Who Got Pinched For Allegedly Fleecing Dead Client's Estate Of Nearly $200K

In Indio, California, the San Bernardino Sun reports:
  • A former San Bernardino-based attorney who allegedly drained a nearly $200,000 trust account that he was entrusted with setting up for clients involved in an estate dispute pleaded not guilty today [May 10] to embezzlement and money laundering charges.(1)

    Martin Edgar Keller, 63, is charged with four counts of money laundering and one count each of embezzlement and grand theft.

    Keller was tasked with placing $206,635.07 into a trust account until the children and other trustees of a deceased woman’s estate could settle how to distribute the funds, according to a declaration in support of an arrest warrant.

    The document states that $194,825 was later found to be missing. An investigation determined that Keller allegedly drained the trust account by writing checks to himself or electronically transferring funds to other accounts he controlled.

    The declaration alleges that at least some of the money was used for lease payments for Keller’s San Bernardino office and late fees.

    Law enforcement began investigating in 2015, after one of the woman’s sons, a Palm Desert man, told deputies that the money was missing and he believed Keller had embezzled it, the declaration states.

    A sheriff’s deputy stated that the last statement he viewed for the account showed that just over $50 was left, according to court documents.

    A lawyer representing the woman’s son said in court documents that Keller was declared ineligible to practice law starting in October 2014, about two years after he deposited the money into the trust account. However, the attorney said “Mr. Keller continues to be an involuntarily inactive member of the Bar” and “has been totally unresponsive to multiple attempts to contact him.”

    The State Bar of California also disciplined Keller for various violations, including misconduct, for allegedly failing to file paperwork in his clients’ cases and ignoring their attempts to contact him, according to disciplinary documents from the State Bar. His law license was suspended twice, once for 30 days and the second time for six months.

    Keller was arrested last week and is being held on $195,000 bail, according to jail records
Source: Former San Bernardino-based attorney pleads not guilty to embezzling nearly $200K.
(1) The California State Bar's Client Security Fund is a discretionary fund that can reimburse clients who have lost money or property due to theft or dishonesty by a California lawyer. It is a State Bar program funded entirely by California lawyers. The amount the fund may reimburse for theft committed by a California lawyer depends on when the loss occurred. A maximum of $50,000 is reimbursable if the loss occurred before January 1, 2009. A maximum of $100,000 is reimbursable if the loss occurred on or after January 1, 2009.

For similar "attorney ripoff reimbursement funds" that sometimes help cover the financial mess created by the dishonest conduct of lawyers licensed in other states and Canada, see:
Maps available courtesy of The National Client Protection Organization, Inc.

'American Gangster' Prosecutor, Law Partner Face Charges Of Allegedly Ripping Off Over $140K Of Client Cash, Then Lying Under Oath To Cover Their Tracks; Prosecutor: Defendants "Treated Their Attorney Trust Account Like A Personal Slush Fund..."

In Newark, New Jersey, reports:
  • A former prosecutor whose takedown of Harlem heroin kingpin Frank Lucas was dramatized in the film "American Gangster" now faces theft and conspiracy charges after state authorities accused him and his law partner of stealing from clients at their private practice.

    Richie Roberts and partner Gerald Saluti were indicted Wednesday [May 17] on charges they misused more than $140,000 and then lied under oath to cover their tracks.(1)

    Reached by phone, Roberts -- who pleaded guilty in federal court to tax crimes last month -- professed innocence and said he told state prosecutors he would gladly submit to a lie detector test.

    "To satisfy the Star-Ledger and myself, I'll take a polygraph today," he said.

    According to the state Division of Criminal Justice, which brought the charges, Roberts and Saluti allegedly conspired with an administrator at their firm, the Saluti Law Group, to steal settlement money and escrow funds from four clients in 2012 and 2013.

    Elie Honig, the division's director, said in a statement the lawyers "treated their attorney trust account like a personal slush fund that they spent on everything from cars and entertainment to, in Roberts' case, paying alimony."

    When clients began complaining, the two allegedly reported the thefts to law enforcement -- and then tried to pin them on the administrator, Gabriel Iannacone.

    Saluti could not be reached and his attorney did not immediately respond to a message seeking comment. Ianncone pleaded guilty to third degree theft charges in January and is awaiting sentencing, according to prosecutors.
    The state and federal charges marked a long fall for Roberts, a prominent defense attorney with a storied career in law enforcement.

    Roberts served as a detective and then an assistant Essex County prosecutor in the 1970s, when he obtained an indictment against Lucas -- the most powerful heroin dealer in Harlem -- for Lucas' role in a Newark drug ring.

    The case was later made into the 2007 film "American Gangster," starring Russell Crowe as Roberts and Denzel Washington as Lucas.

    "For all those years, I never did anything wrong, I did everything on the up and up," Roberts said. "Suddenly I'm conspiring (to frame somebody)?"
For the story, see 'American Gangster' prosecutor, partner charged with stealing from clients.

For the New Jersey Attorney General press release, see Two Suspended Newark Lawyers Indicted on Charges They Stole Over $140,000 From Clients of Their Law Firm.
(1) The New Jersey Lawyers' Fund for Client Protection was established to reimburse clients who have suffered a loss due to dishonest conduct of a member of the New Jersey Bar.

For similar "attorney ripoff reimbursement funds" that sometimes help cover the financial mess created by the dishonest conduct of lawyers licensed in other states and Canada, see:
Maps available courtesy of The National Client Protection Organization, Inc.

Long-Time Lawyer Ends 40-Year Career By Getting Bar Boot For Glomming Onto $100K Of Client Funds From Attorney Trust Account

In Los Angeles, California, the Northern California Record reports:
  • The State Bar Court of California recently disbarred Ronald Lee Bartholomew, a Newport Beach attorney, after finding him guilty of misappropriating client escrow funds.

    The order was handed down on March 1, and the charges stem from a client matter in 2013.

    On May 29, 2013, the two owners of Skyset Investments L.L.C. entered into a financial agreement with Metro Global Corporation. The next day, Bartholomew agreed to act as the escrow agent for the deal. On May 31, 2013, $70,000 was deposited into the attorney’s client trust account with Chase Bank and an additional $30,000 was deposited in June. Both transactions were made by Skyset.

    Bartholomew began making withdrawals from the account almost immediately after the funds were deposited. The attorney also made disbursements of the escrow funds, though he was not instructed to do so by Skyset. This continued until June 28, 2013 when the account balance was just over $100. As a result, multiple requests were made by Skyset and those acting on behalf of the company to be reimbursed the $100,000.

    The California State Bar sent a notice of disciplinary charges to Bartholomew on April 20, 2015 requesting a response to the allegations. The attorney replied, stating that no such funds had ever been deposited into his trust account. At the time of disbarment, the attorney still has not refunded the $100,000.(1)

    Bartholomew entered into a pretrial stipulation, but because he had committed multiple acts of misconduct and failed to make restitution, the State Bar Court of California issued an order for disbarment.

    The Orange County attorney is a graduate of Western State University’s law program and was admitted to the California State Bar in 1971. Through his over 40-year career, Bartholomew had only one prior instance of discipline, a public reproval in 2014.
Source: Newport Beach attorney disbarred for misappropriating escrow funds.
(1) The California State Bar's Client Security Fund is a discretionary fund that can reimburse clients who have lost money or property due to theft or dishonesty by a California lawyer. It is a State Bar program funded entirely by California lawyers. The amount the fund may reimburse for theft committed by a California lawyer depends on when the loss occurred. A maximum of $50,000 is reimbursable if the loss occurred before January 1, 2009. A maximum of $100,000 is reimbursable if the loss occurred on or after January 1, 2009.

For similar "attorney ripoff reimbursement funds" that sometimes help cover the financial mess created by the dishonest conduct of lawyers licensed in other states and Canada, see:
Maps available courtesy of The National Client Protection Organization, Inc.