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Marc P. Wyman

Thursday, May 13th, 2010

05/13/10

Colorado Division of Real Estate
1560 Broadway #925
Denver, CO 80202
Attn:  Enforcement

Please treat this as a formal complaint against Marc P. Wyman appraisal license CR40015674.

Specifically, I am asking the Board to investigate this complaint, take corrective or disciplinary action as allowed by law, and to inform me of the outcome.  In addition, I am asking the Board to promptly send me a form letter to confirm receipt of this complaint, provide me with a case number, and to make a good faith effort to spell the names correctly.

In support of this complaint, I have attached a complete (printed) copy of Mr. Wyman’s appraisal report for the property located at 885 Cinnabar Dr, Castle Rock, CO  80108.  The appraisal report is dated 10/24/07.  A .pdf version of the appraisal report is available on request.

For your convenience this document (including all attachments) is published on the Internet at:

http://www.mkgappraisal.com/letter2010_02.htm

Mr. Wyman appraised the property at $1,068,000.  The subject property was a new construction builder sale.  This property was never (ever) worth a million dollars.  Not even close.

The appraisal report states:

Golden Design Group has 47 lots within the Maher Ranch development also known as the Puma Ridge/Saphire Point area.  There are currently 30 homes sold with 17 lots still available.

Based on what I know, this sounds about right to me.  I accept this statement at face value.

Pete Capra is (was?) the CEO of a local builder doing business as Golden Design Group (GDG).  During 2003 through 2006 GDG built and sold homes in (at least) 4 locations:  Castle Rock, Parker, South Aurora, and North Denver.  I estimate they sold 200 homes.  To the best of my knowledge, Pete Capra never used a licensed real estate agent, and none of the GDG homes was listed in MLS or exposed on the open market.

I have formed an opinion that all (100%) of these homes were sold to straw buyers and/or outright crooks.  Two examples that come to mind are Demetrius G Gianopoulos and Young Kim.

Presumably, all 200 of these transactions included an appraisal.  All 200 of the appraisals were used to justify big dollar mortgage loans which included big dollar mortgage fraud.  All 200 of these transactions resulted in early payment default and foreclosure.  This can be easily verified by the public (county) records.

The subject appraisal report was prepared for a purchase mortgage on a brand new house.  An 80% mortgage loan in the amount of $852,800 was made by the good people at Wells Fargo, along with an unrecorded 2nd mortgage for a total loan of $1,066,000.

This purchase transaction was a fraud.  Carly Makie is a straw buyer.  Carly Mackie never made a down payment.  Carly Mackie never moved into the house.  Carly Mackie has never set foot in Colorado.

$33,000 Per Month

Carly Mackie never made a payment.  As a result, the mortgage loan went into default.  The property promptly went into foreclosure.  10 months later (8/26/08) the property was back on the market with an asking price of $600,000.  This property was never worth $600,000.  The MLS listing describes the property as “never lived in”.  Indeed.

On 5/6/09 (150 days on market), the property sold for $450,000 with a $13,500 seller concession.  Which is to say the property sold for $436,500.  Which is $629,500 less than the mortgage.

From the date of the appraisal (10/24/07) to the date of the legit sale (05/06/09) works out to approximately 19 months.  Over this 19 month period, the property was losing value at the rate of $33,000 per month.

Golden Design Group (GDG) sold a total of 30 properties in this development.  I wonder if Marc P. Wyman did the other 29 appraisals.  And if not Mr. Wyman, then who?

USPAP

At the summary level, USPAP says an appraiser must be 2 things:  1)  Ethical, and 2) Competent.  At the risk of oversimplification – an appraiser should know what’s going on in the real estate market, and be willing and able to tell it like it is.  This appraisal report is a complete failure.

In September of 2005, Colorado had a big problem with foreclosures.  We were among the top 2 or 3 states in the country.  This was not a secret – it was in the newspapers and on TV.  A Rocky Mountain News article dated 9/10/05 said that Colorado was leading the nation in the rate of foreclosure.

This had been going on for 2 years when Marc Wyman did this appraisal.  How could any self respecting appraiser not know?  The appraisal report (dated 10/24/07) makes this statement

market conditions in Metropolitan Denver are stable and strong

This statement is not independent, objective, unbiased.  This statement is all about trying to get the loan approved.

The URAR asks the appraiser if they did (or did not) analyze the sales contract.  The appraiser checked the “yes” box.  Presumably Mr. Wyman has retained a copy of the contract in his appraisal file.

The URAR asks the appraiser to “explain the results of the analysis of the contract…” .  The appraisal report says

The sales [sic] appears to be an arms length transaction.  The sales price appears to be reasonable and supportable with available current market data.”

My comment:  the correct spelling of arm’s length includes an apostrophe.  I wonder what part of the analysis/review of the contract made it “appear” to be an arm’s length transaction.

One of the most important steps of every appraisal assignment is to define the geographic boundaries of the neighborhood, and then provide a range of dollar values.  The appraiser reports the high end of the range, the low end, and predominant.

On page 1 of the URAR, Mr. Wyman gives the neighborhood boundaries as:

north of highway 86, south of E. Happy Canyon Road as extended, east of Daniels Park Road and west of Parker Road……the subject market area is typified by ranch and multi-level homes of very good quality, generally similar to the subject in terms of market appeal

These boundaries are excessively large – to the point of being meaningless.  This area includes all of the Castle Pines Golf community which is on the other side of I-25.  Castle Pines is not part of Maher Ranch, any more than Aspen or Vail.

The appraisal report says neighborhood values are $750 low, $2.3M high, and $1.0M predominant.  As near as I can tell, these numbers are just made up and have no basis in reality.  There has never been a property in Maher Ranch that sold for $2.3M.  Not even close.

I did a CMA on this same neighborhood dated 4/17/08 and I got values of $341/$845/$418.  Some of the difference can be explained as a change in the market, but it didn’t change that much in 6 months.  See (for example) the listing history for 6931 Sulfur Ct.  This property sold 3 times – 8/15/05, 6/10/07 and 10/29/08.  These 3 sales demonstrate the change in the market over time.

Consider these 5 properties:

  1.  804 Xenon sold for $540,000 9/25/07.
  2. 6931 Sulfur Ct sold for $495,000 6/5/07.
  3. 1828 Peridot Ln sold for $438,000 5/11/07.
  4. 6857 Sulfur Ct sold for $405,000.
  5. 1668 Peridot Ct sold for $349,000 on 6/1/07.

These are all 2 story properties located in Maher Ranch.  All of this was readily available in MLS – copies are provided below.

My comment – the low end of the market range should have been reported as $349.  The values stated in the report ($750/$2.3M/$1.0M) are a shameless attempt to portray the subject property as typical/middle of the road – and therefore loan-worthy.  This is not independent, objective, unbiased.  This is a deliberate violation of the USPAP ethics rule(s).

The appraisal report presents 5 comps.  Two of the comps (#1 and #5) are nearby properties from the same builder.  Both of these properties were also big dollar fraud sales.  Mr. Wyman is using fraud to justify more fraud.  I firmly believe it is unfair to expect Mr. Wyman (or any appraiser) to have known these sales were fraudulent, or to have ignored these sales.  On the other hand – I firmly believe Mr. Wyman should have taken into consideration that both of his GDG comps were never listed on MLS and never exposed on the open market.  Did he think all 30 of the GDG sales were successfully marketed by word of mouth?

Furthermore, Mr. Wyman should have considered that his sole source for this data had a $30M incentive to tell one side of the story.  In these situations the builder (any builder) will never admit to (much less offer up) anything that might suggest the value of the subject property is less than the contract price.  This does not mean all builders are liars – but it does mean appraisers need to make a diligent effort to consider all sides, and weigh the comps accordingly.

Two of the other 3 comps are from outside Maher Ranch.  Comp #2 is 3 miles away, in a different neighborhood, and judging by the photo, clearly superior to the subject property.  Comp #3 (5225 Knobcone) is more similar to the subject property, but it’s hard to justify going outside the neighborhood when there are plenty of good comps available inside the same neighborhood.  The listing for Comp #4 (6588 Tremolite) says – “Puma Ridge new custom builder community…” .  The builder for comp #4 was Carlson.

On the date of this appraisal, the property at 991 Cryolite Pl was listed for sale at $525,000.  The listing says “seller motivated” and it also says “agent owner”.

It’s reasonable to ask 2 questions -

  1. Why would a real estate agent sell their own house on the open market for anything less than the best (highest) possible price?
     
  2. Why would anyone pay $1M for the subject property when they could have bought 991 Cryolite for half that price?

On 10/24/07 (the date of the appraisal), MLS showed the property at 1841 Dolomite “under contract” with an asking price of $385,000 – after 190 days on market.  This property was not trashed out – the listing says “immaculate”.  The listing also says the property is priced below market value – but it did not say by how much.

Better Comps

  1. 804 Xenon,
    MLS pg1 and listing history
     
  2. 6931 Sulfur,
    MLSpg1 (06/05/07) and listing history
    MLS pg1 (10/29/08)
    Note: This property demonstrates the change (decrease) in the market from June, 2007, to October, 2008.
     
  3. 6857 Sulfur,
    MLS pg1 and listing history
     
  4. 1828 Peridot,
    MLS pg1 and listing history
     
  5. 1668 Peridot,
    MLS pg1 and listing history
     
  6. 991 Cryolite,
    MLS pg1 and listing history
     
  7. 1841 Dolomite,
    MLS pg1 and listing history
     
  8. 1235 Baguette Dr,
    MLS pg1 and listing history
    Asking price on 10/24/07 = $440,000.  This property had been on the market for 5 months, with 5 price reductions.
     
  9. 7351 Soapstone Ct,
    MLS pg1 and listing history
    Asking price on 10/24/07 = $475,000.  This property had been on the market 10 months, with 2 price reductions.
     

These are all 2 story properties located in Maher Ranch (see map).  All of these are reported in MLS.

Sincerely,

Philip G Rice
11268 E Linvale Dr
Aurora, CO  80014
720-282-3376
phil.rice@mkgappraisal.com

Attachments

Appraisal Report – .pdf format
Subject Property – MLS pg1 and listing history
Comp #1 – MLS pg1 and listing history
Comp #2 – MLS pg1 and listing history
Comp #3 – MLS pg1 and listing history
Comp #4 – MLS pg1 and listing history
Comp #5 – MLS pg1 and listing history

– End of Letter –

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Theodore A. Rinehart

Monday, March 15th, 2010

03/15/10

Colorado Division of Real Estate
1560 Broadway #925
Denver, CO 80202
Attn:  Enforcement

Please treat this as a formal complaint against Paragon Appraisal Service, Advantage Sells, and the real estate license(s) of Theodore A. Rinehart.  Employing Broker EL40020819 and Certified Residential Appraiser CR40011516.

Specifically, I am asking the Board to investigate this complaint, take corrective or disciplinary action as allowed by law, and to inform me of the outcome.   In addition, I am asking the Board to promptly send me a form letter to confirm receipt of this complaint, provide me with a case number, and to make a good faith
effort to spell the names correctly.

In support of this complaint, I have attached a complete (printed) copy of Mr. Rinehart’s appraisal report for the property located at 5687 Distant View Pl, Parker, CO  80134.  The appraisal report is dated 11/09/07.  A .pdf version of the appraisal report is available on request.

For your convenience this document (including all attachments) is published on the Internet at:
http://www.mkgappraisal.com/letter2010_01.htm

Mr. Rinehart appraised the property at $1,260,000.  The subject property was a new construction builder sale.  This property was never (ever) worth a million dollars.  Not even close.

Pete Capra is (was?) the CEO of a local builder doing business as Golden Design Group (GDG).  During 2003 through 2006 GDG built and sold homes in (at least) 4 locations:  Castle Rock, Parker, South Aurora, and North Denver.  I estimate they sold 200 homes.  To the best of my knowledge, Pete Capra never used a licensed real estate agent, and none of the GDG homes was listed in MLS or exposed on the open market.

I have formed an opinion that substantially all of these homes were sold to straw buyers and/or outright crooks.  Two examples that come to mind are Demetrius Gianopoulos and Young Kim.

Presumably, all 200 of these transactions included an appraisal.  All 200 of the appraisals were used to justify big dollar mortgage loans which included big dollar mortgage fraud.  All 200 of these transactions resulted in early payment default and foreclosure.  This can be easily verified by the public (county) records.

I wonder how many of those 200 appraisals were done by Ted Rinehart.  And if not Mr. Rinehart, then who?

The subject appraisal report was prepared for a purchase mortgage on a brand new house. According to public records there was a one million dollar first mortgage and a $108,000 second mortgage for a total of $1,108,000 from the good people at Wells Fargo and/or Colorado Mortgage Alliance.

This purchase transaction was a fraud. Jason Kim is a straw buyer. Jason Kim never made a down payment. Jason Kim never moved into the house. Jason Kim has never set foot in Colorado.

$37,000 Per Month

Jason Kim never made a monthly payment.  As a result, the mortgage loan went into default.  The property promptly went into foreclosure.  9 months later (8/12/08) the property was back on the market with an asking price of $600,000.  After 307 days on market, the property sold for $520,000.  Which is $740,000 less than the appraised value and $660,000 less than the mortgage. From the date of the appraisal (11/09/07) to the date of the legit sale (7/29/09) works out to approximately 20 months.  Over this 20 month period, the property was losing value at the rate of $37,000 per month.

At the summary level, USPAP says an appraiser must be 2 things:  1) Ethical, and 2) Competent. At the risk of oversimplification – an appraiser should know what’s going on in the real estate market, and be willing and able to tell it like it is.  This appraisal report is a complete failure.

In September of 2005, Colorado had a big problem with foreclosures.  We were among the top 2 or 3 states in the country.  This was not a secret -it was in the newspapers and on TV.  A Rocky Mountain News article dated 9/10/05 said that Colorado was leading the nation in the rate of foreclosure.

This had been going on for 2 years when Mr. Rinehart did this appraisal. How could any self respecting appraiser not know? The appraisal report (dated 11/09/07) makes this statement -

The metro-wide single family median price has increased by 5% plus over each of the past 2 years.  The market appears to be stable.

On page one of the URAR, the box is checked “yes” to say the property is currently (or in the past 12 months) offered for sale.  The next line asks the appraiser to report data sources used, offering price(s), and dates.  The response is “MLS-List/Public Records”.  No dates are given.  I believe this is incorrect and/or misleading.  To the best of my knowledge, the subject property was never listed on MLS.

The URAR asks the appraiser if they did (or did not) analyze the sales contract.  The appraiser checked the “yes” box.  Presumably Mr. Rinehart has retained a copy of the contract in his appraisal file.

The contract price is given as $1,280,000 dated 11/05/07 with a seller concession of 2% / $25,600.  The URAR asks the appraiser to “explain the results of the analysis of the contract…”.  The report says:

“We confirmed the sales price, inclusions and the fact that there are seller concessions”.

The thing that got my attention is the word “we”.  I wonder who exactly is “we”?  The appraiser (Theodore Rinehart) certified (see #19) that he did not rely on “significant real property appraisal assistance from any individual”.  I cannot imagine how someone could think that confirming the sales price and concessions is not “significant real property appraisal assistance”.

One of the most important steps of every appraisal assignment is to define the geographic boundaries of the neighborhood, and then provide a range of dollar values. The appraiser reports the high end of the range, the low end, and predominant.

The appraisal report shows the neighborhood boundaries as Jordan Road to the west, Main St to the south, Lincoln Ave to the north, and Parker Road to the east.  The north and south boundaries are both wrong.

The neighborhood values are reported at $800K low, $2M+ high, and $1.2M as the predominant value.  I wonder about the significance of the plus sign.  The top end of the range is not just $2M, it is reported to be $2M+.  Does the plus sign mean the top end of the range is (slightly?) more than $2M?  If Mr. Rinehart had thought the low end of the range was slightly less than $800 would he have used a minus sign?  Does the lack of a minus sign mean he felt the low end of the range was at least $800 or pretty much right on the number?  I see the plus sign as a small attempt to “sell” the neighborhood and to “sell” the subject property as loan-worthy.  If someone wants to say I am being nit-picky, I would not argue.  But I would also say the subject property is well south of Main St and the low end of the range is well south of $800,000.

I did a CMA on this neighborhood dated 3/08/10. My search criteria was a one mile radius from the subject property, with every sale from 11/09/06 thru 11/09/07. To be fair, I know that there are some sales that have been dropped from MLS because 11/09/06 is more than 3 years ago. Having said that, my CMA did show 86 sales, and all 86 of these sales were readily available to Mr. Rinehart. My CMA shows $198 low, $1.9M high, and $514 median price. The property at 5935 Lasso Pl sold for $450 with a $15 concession (net=$435) on 9/5/07. This is a 2,994 sq ft ranch located in Pradera, less than 0.6 mile from the subject.  See MLS listing #556320.

The low end of the range should have been reported no higher than $435.

Consider these 4 properties (MLS copies provided below):

  1. 5400 Craftsman sold for $549 less $16 concession (net=$533) 04/27/07.
  2. 5226 Mining Camp sold $557 on 04/04/07.
  3. 4940 Streambed listed at $700 on the date of the appraisal.
  4. 5473 Hacienda Pl listed at $726 on the date of the appraisal.

Each of these is a 2 story property. Each of these 4 is roughly equal to the subject property in terms of location. See attached map.

It’s reasonable to ask – why would anyone pay $1.2M+ for the subject property when they could have bought 4940 Streambed or 5473 Hacienda for a half million dollars less?

The appraisal report presents 5 comps.  One of the comps is a nearby property from the same builder which was also a big dollar fraud sale.  The other 4 comps are all “custom” homes, per the MLS listing.

The appraisal says the house is appraised “as is”.  And yet, the appraisal report states:  “The home is new home and will be built will very quality materials”.

Never mind that the grammar is butchered – the appraiser is making promises about the quality of the work that has not yet been completed.

The appraisal report includes a 2 page summary of the qualifications and experience of Theodore Rinehart, the appraiser.  Based on my review of this 2 page summary, I cannot convince myself that Mr. Rinehart did not know any better.  And in some cases (for example, the butchered grammar and the promises about work yet to be done), I wonder if Mr. Rinehart signed his name to an appraisal that was done by someone else.

Better Comps

  1. 5473 Hacienda Pl,
    MLS pg1 and listing history
  2. 4940 Streambed Trl,
    MLS pg1 and listing history
  3. 5400 Craftsman Dr,
    MLS pg1 and listing history
  4. 5226 Mining Camp Trl,
    MLS pg1 and listing history

These are all 2 story properties located within a one mile radius of the subject property (see map).  All of these are reported in MLS.

I certify that the statements and information supplied
by me are true and accurate to the best of my knowledge.

Philip G Rice
11268 E Linvale Dr
Aurora, CO  80014
720-282-3376
phil.rice@mkgappraisal.com

Attachments

Appraisal Report – .pdf format
Subject Property – MLS pg1 and listing history
Comp #1 – MLS pg1 and listing history
Comp #2 – MLS pg1 and listing history
Comp #3 -MLS pg1 and listing history
Comp #4 – MLS pg1 and listing history
Comp #5 – MLS pg1 and listing history

– End of Letter –

Posted in Appraisal, Mortgage Fraud, Skippy | No Comments »

Lost in the Mail?

Saturday, January 17th, 2009

01/17/09

Colorado Division of Real Estate
1560 Broadway #925
Denver, CO 80202
Attn:  D. Rico Munn

To distribution list via snail mail

For your convenience this document (including all attachments) is published on the Internet at:

http://www.mkgappraisal.com/letter2009_01.htm

Business as Usual

I direct your attention to this letter dated 3/2/07.  The letter is signed by Erin Toll and addressed to Virginia Gibbs at the ASC office in “ashington !C” [sic].  The letter says:

More than fifty percent of the staff and six of the seven management team staff are new to the DRE.  The new staff ensures that it will not be “business as usual” at the DRE

This sounds good.

Under the new leadership we have gone from non-existent enforcement to pathetically inadequate.  An optimist would say we are moving in the right direction.

Think I am being too harsh?  Unrealistic?

That was Then

In September of 2005, I filed 20 complaints against Colorado appraisers.  At the time, Stewart Leach was running the show at the Appraisal Division of the Colorado Board of Real Estate.  I received the standard form letter confirming receipt of 3 complaints – and nothing for the other 17.

Two months later (11/29/05), I sent a (first request) follow-up letter to Stewart.  I respectfully requested some kind of confirmation of receipt.  Were the other 17 complaints received?  Or not?

In mid December 2005, I received a form letter confirming receipt of one more complaint.  The form letter indicated my complaint was received on 11/28/05 – more than 2 months after I had mailed it.  At this point – 3 months had gone by since I mailed the 20 complaints, and 16 were still unaccounted for.  Had they been lost in the mail?

I sent a (second request) follow-up letter to Stewart on 1/09/06.  I summarized and updated the situation, and again asked the question – were the complaints received?  Or not?

I sent another (third request) follow-up letter to Stewart on March 02, 2006.  Did they receive my complaints?  Or Not?

I sent another (fourth request) follow up on May 3rd, 2006.  I said:

This is the 4th request – it’s been 7 months since I mailed the complaint.  Did your office receive the complaint, or not?

What do I need to do?  Use certified mail?  Send the question on the letterhead of a local attorney?  If it will make a difference, please consider this a freedom of information request, or in the alternative, Colorado Open Meetings (Sunshine) Law (24-6-401+).

Under the circumstances, I consider your lack of response beyond rude.  Are you unable or unwilling to respond – or both?  Is this standard procedure or am I getting special treatment?

The next day (5/4/06) I got an email response from Debbie Campagnola – which said:

Mr. Rice,
The Division of Real Estate did receive your complaint against Santiago Silva.  You not receiving an acknowledgement letter was an error on the part of staff.

A few weeks later Debbie Campagnola and Stewart Leach were both fired.  Erin Toll was appointed Director on 9/5/06.

This is Now

The 2009-2010 DORA Strategic Plan (item #3) says

Complaint Resolution – Several of DORA’s divisions experienced significant backlogs of processing complaints a couple of years ago.  Through reorganization of staff and a concentrated triage effort of processing complaints, we have all but eliminated backlogs that were, in some divisions, as high as 85%.  DORA continues to work on improving its complaint resolution processes and shares best practices across divisions in order to timely process complaints.

One key learning of the Stewart Leach administration is that before you can “timely process” a complaint, you have to be able to receive the complaint.  A monthly copy of the complaint log is only meaningful if the complaints are being logged in.  Right?

I urge you to consider my recent experience – details below.  As you read my comments, ask yourself – does this sound like “best practice”?

Deja Vu All Over Again

In June and July of 2008 I filed a series of complaints with the Colorado Division of Real Estate.

I never got any kind of response to the following complaints:

Pete Nemeth (FA40039284) and Rob Gremminger (LMB100011393).  This complaint(s) is dated 6/24/08.

Andy Mitchell (FA40020422) and Demetrius Gianopoulos (FA100004301).  This complaint(s) is dated 7/01/08.

Jason Stephens (FA40021244).  This complaint is dated 7/21/08.

Peter Vincent Capra (LMB100009013).  This complaint is dated 7/23/08.

I sent a follow up letter (first request) dated 8/13/08 and asked the question – were these complaints received?  Or not?

Second Request

Rico – this is my second request.  Did the Colorado Division of Real Estate receive these 6 complaints?  Or not?

I spent (estimated) 3 hours preparing and mailing each of these complaints – 18 hours total.  I do not get paid for this work – in fact I spent about $25 of my own money to cover the postage and copy fees.

Your lack of response is beyond rude.  What do I have to do to get a response to a relatively simple and straightforward question?

Lisa Gray

I received a letter (copy attached) from the Colorado Division of Real Estate – dated 8/15/08 signed by Lisa Gray.  It’s a standard form letter referencing complaint number 2008081011.  Lisa’s letter refers to “the person you have filed a complaint against”.

A few days later (Aug 20th, 2008) I sent a reply which said:

I have filed complaints against several persons.  Please be more specific.  Which person does Lisa’s letter refer to?

I sent that letter 5 months ago.  I never got any kind of response.

Lisa’s letter says:

Should you have any questions about this process, please contact me at (303) 894-2369

This sounds good.

I called the number at about 9 am on Tuesday, January 14th 2009.  I got Lisa’s voice mail.  I left a brief and polite message that referenced her letter and asked her to call me at her earliest convenience.  I have not received any kind of response.  Under the circumstances I’m not holding my breath.

Is this standard procedure?  Or am I getting special treatment?

Conclusion

If it is broke – fix it.  Your confirmation letters should always:

  1. Spell my name right.  Your track record is about 50%.  See for example the Lisa Gray letter dated 8/15/08.
  2. Correct spelling on the name of the person(s) named in the complaint.  Specifically, your spelling should agree exactly with the name on the license.  See for example the name Stacy McDonald butchered as Robert.  For an example of why this is important see the Zhaohui a/k/a Joe Ma fiasco.  This happens with alarming regularity.  If the DRE can’t or won’t be part of the solution, at least make an effort to not make things any worse than they already are.
  3. Tell me the date you received my complaint.  When I spoke up about the 2 months it took to receive my complaint – this problem was “solved” by removing the received date from the confirmation letter.  This raises disturbing questions about the integrity of the complaint log data, the people who maintain the log, and the people who use the data for self promotion.

Receive the complaint.  Log it in.  Assign case number(s).  Send out form letter.  Spell the names right.  Is this too much to ask?  Am I being unreasonable?

Sincerely,

Philip G Rice
11268 E Linvale Dr
Aurora, CO  80014
720-282-3376
phil.rice@mkgappraisal.com

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3rd Request

Wednesday, August 20th, 2008

August 20th, 2008

Colorado Division of Real Estate
1560 Broadway #925
Denver, CO 80202
Attn:  Erin Toll

via snail mail

For your convenience a complete copy of this letter is posted on the Internet at:
http://www.mkgappraisal.com/letter2008_16.htm

cc:  distribution list

Spell the Name Right – 3rd Request

I received a letter from Lisa Gray – copy attached.  Her letter is dated 8/15/08.  Lisa spelled my name wrong.

I spoke up about this problem in my letters dated March 2006 and June 10th, 2008.  I never got any kind of response.

Lisa’s letter refers to “the person you have filed a complaint against”.  I have filed complaints against several persons.  Please be more specific.  Which person does Lisa’s letter refer to?

Receive the complaint.  Log it in.  Assign complaint number(s).  Send out 2 form letters.  How hard can this be?  Am I asking too much?  Am I being unreasonable?
Sincerely,

Philip G Rice
11268 E Linvale Dr
Aurora, CO  80014
720-282-3376
phil.rice@mkgappraisal.com

ps – To all who have read this far, please take a minute and think creatively about something you can do.  Make a positive difference.  If you need help, call me at 720-282-3376 or send an email.

– End of Letter –

Posted in Appraisal, Mortgage Fraud, Skippy | Comments Off

Nick Beal

Sunday, August 3rd, 2008

August 3rd, 2008

This is an open letter about mortgage fraud in Aurora, Colorado.  Distribution on this letter is by email and also published on my blog.

Index of Attachments

Buy One, Get One Free

Del Monte Catsup at King Soopers – buy one get one free.  Sounds crazy to talk about $900,000 houses as – ‘buy one get one free’.  Right?

photo

Brian Waring

16713 E Lake Dr, Aurora, CO  80016 (Piney Creek Village).  This home was built in 2002 – one of many built and sold by Golden Design Group.  In late 2003 this property had been sitting there for about 12 months – and the sales crew at Golden Design had several houses they wanted to sell.  So Pete Capra (Golden Design CEO) worked out a deal with Brian Waring.  Brian bought this property approximately 12/12/03.  The purchase price is recorded as $730,000 with a $730,000 mortgage loan provided by the good people at First Franklin Financial Corp.

Nicholas J Beal

Three months later, this property went on the market with an MLS listing asking $775,000.  After 85 days on market there was no sale – the listng was withdrawn 06/11/04.  17 monts later it went back on the market (October 2005) asking $899,000 – a significant price increase.  The listing history shows the property “under contract” 2 weeks later (11/27/05).  Then Nicholas J Beal bought this property from Brian Waring sometime in late December, 2005 – with the loan recorded on 01/4/06.  Somehow this sale happened without the knowledge of the listing agent.  The property remained as an active listing for 4 more months until the listing expired 4/20/06.  The sale was not recorded in MLS.  It’s not clear if the listing agent collected a commission.

The sale price is recorded in public records as $849,000 with a mortgage loan provided by First Magnus Financial Corp.

On August 17, 2007, the New Jersey Department of Banking and Insurance (NJDOBI) issued legal documents ordering First Magnus Financial Corporation to stop doing business in the state and took the initial step toward revoking the company’s mortgage lender license.

The public records makes it look like Nicholas J Beal (the buyer) made a $200,000 down payment – but I don’t believe that.

Brain Waring was able to “sell” (I use the term loosely) for $119,000 more than he “paid” (I use the term loosely).  That’s an increase of about 8% per year for the 2 year time frame.

The sole purpose of this (Dec 2005) transaction was to generate excess mortgage funds, a/k/a cash back at closing, a/k/a mortgage fraud.  Nobody ever moved into the house, and Nick Beal never made a payment.  The house promptly went into foreclosure.

This house sold 04/07/08 for $496,000 after 218 days on market.  This house lost $350,000 in value from January 2006 to August 2007.  That’s $350,000 in about 20 months time.

There is some good entertainment value associated with the REO sale.  Michael Garard (the listing agent) included this note in the sold listing -

Appraisers – the buyer was an agent and took 0% commission and the price was reduced

My best guess is that Michael is thinking this property sold below market value, i.e. – the true market value is higher than the contract price.  This would make perfect sense to Darren J Hayden.

Public records shows the buyers are Radu Demetrescu Vulcan and Marioara Demetrescu Vulcan (I’m not making this up).  Radu Vulcan is not a licensed real estate agent.  As near as I can tell, the selling agent is/was Tom M Basile (ER154461) of Partners West in Wheat Ridge.  There is a mortgage loan of $278,000 recorded by the lender, American Mortgage Network, Inc., a/k/a Vertice, a/k/a Wachovia.

So lets see if I have this right – Radu and Marioara were able to make a $220,000 down payment and Tom Basile helped them buy the house for a commission of $zero.  Do I have that right?

What could possibly go wrong here?

Get One Free

6159 S Memphis Ct, Aurora, CO  80016 (Piney Creek Village).  About a month after he bought 16713 E Lake St (01/31/06), Nicholas J Beal bought himself another house.  The sale price is recorded as $940,509 with a mortgage loan of $940,000 provided by the good people at American Brokers Conduit – now kaput.

At the time Nicholas bought this house, it was on the market with an asking price of $988,000.  The sale is not recorded in MLS and the listing was withdrawn 4 months after the sale.  It’s not clear if the listing agent collected a commission.

Golden Design Group

Nicholas J Beal bought this property from Golden Design Group / Pete Capra.  The sole purpose of this transaction was to generate excess mortgage funds, a/k/a cash back at closing, a/k/a mortgage fraud.  Nobody ever moved into the house, and Nick Beal never made a payment.  The house promptly went into foreclosure.  The REO listing says “like new needs landscaping”.

This property was listed on MLS for sale in January 2007.  It’s still active on MLS – currently asking $624,900.  That’s $315,000 less than the loan amount, and of course it remains to be seen what this house will sell for.  It could get worse.

Conclusion

If you buy a house – but never make a down payment and never make a monthly payment – that’s free.  Right?  And if you walk away from the closing table with $200,00 cash in your back pocket that’s better than free.  Right?  And if you can do it twice, why not go for 20?

My (educated) guess is that during 2006 Pete Capra was knee deep in a lot of these deals.  At $250,000 (cash) mortgage fraud per transaction, it adds up to some serious cash.

Who did all those appraisals?  Maybe it was someone already on Erin Toll’s list of “bad actors“.  If you believe (like I do) that the person(s) who did these appraisals did not play by the rules – and if you believe (like Erin Toll does) that “virtually all” licensed appraisers “play by the rules” – it would mean that it virtually must have been James Esters who did all those bogus appraisals.  Whew.

Disclaimer

Everything in this document is my interpretation of information found in the public records.  It’s my opinion, take it for what it’s worth.

Sincerely,

Philip G Rice
11268 E Linvale Dr
Aurora, CO  80014
720-282-3376
phil.rice@mkgappraisal.com

ps – To all who have read this far, please take a minute and think creatively about something you can do.  Make a positive difference.  If you need help, call me at 720-282-3376 or send an email.

– End of Letter –

Posted in Appraisal, Mortgage Fraud, Skippy, Stupid Lender Tricks | No Comments »

Golden Design Group

Wednesday, July 23rd, 2008

July 23rd, 2008

FBI
935 Pennsylvania Avenue, NW
Washington, DC 20535
Attn:  Robert S Mueller, Director

via snail mail
to:  distribution list /with attachments

Dear Bob Mueller

Please treat this as a formal complaint with regard to mortgage fraud – against Derek David Malig, Pete Capra, Richard Fuld, Alan Faigin, and Jim Wells.

By copy of this letter to D. Rico Munn and Erin Toll, please treat this as a complaint against the mortgage broker license of Peter Vincent Capra (LMB100009013).

By copy of this letter to various federal, state, and local agencies, please treat this as a complaint against each of the individuals and business entities named below.

From the Trenchs

I received an email dated 7/16/08:

Take a look at Vistancia Drive in Pradera, Douglas County 98% of the 41+/- homes were sold w/$400,000+/- cash back at closing and are all now in some sort of foreclosure at this point. The straws all paid $1,200,000 not in MLS and then gets resold as a short sale for $500,000 to $800,000 in MLS. The exact same sinerio [sic] is going on up north at Huntington Trails.

I read the email and thought about it for a few minutes.  Then I did a 15 minute investigation.  I formed an opinion that the email is (substantially) correct.

Derek David Malig

16733 E Lake Dr, Aurora, CO  80016 (Piney Creek Village) – Approximately 10/25/06 Derek David Malig bought the property for $999,000.  He bought the property from Golden Design Group (Peter Capra) and obtained a $999,000 mortgage loan from Jumpin’ Jim Wells and the good people at SunTrust Mortgage.

The sole purpose of this transaction was to generate excess mortgage funds, a/k/a cash back at closing, a/k/a mortgage fraud.  Nobody ever moved in and Derek David Malig never made a payment.  The REO listing says “Incredible!  Never Been Lived In”.

This property went into foreclosure.

16733 E Lake Dr has been on the market since 5/1/08 asking $674,900.  That’s $324,000 less than the loan amount in less than 2 years.  And of course it remains to be seen what this house will sell for.  It could get worse.

14275 Santa Fe St, Westminster, CO  80023 (Huntington Trails) – About a month later, approximately 11/21/06 Derek David Malig bough himself another house.  He paid exactly the same price – $999,000.  Looks to me like he got a $999,000 mortgage loan from the good people at Fremont Investment & Loan.

Derek David Malig bought this property from Golden Design Group (Peter Capra).  The sole purpose of this transaction was to generate excess mortgage funds, a/k/a cash back at closing, a/k/a mortgage fraud.  Nobody ever moved in and Derek David Malig never made a payment.

This property went into foreclosure.  It was listed for sale in February 2008 asking $749,900 – the price has been reduced to $649,500.  That’s $350,000 less than the loan, and it ain’t over yet.  It could get worse.

A Few Property Things

The Live Oak, CA high school web site has this entry dated 8/5/05 under the heading David-Malig, Derek:

Let me see, after High School graduation I went to Gav for 2 years.  Then I made the greatest mistake of my life.  I went to Chico State.  I graduated from Chico with BS in Construction Management.  Worked in the industry for awhile and desided to try something else.  So I became a building inspector.  Then desided I didn’t like that, so I became a stripper.  Yes, people will actually pay money to see a short brown guy.  I haven’t grown any taller since high school by the way.  Well eventually you have to retire from that industry since this damn thing called age catches up to you.  So then I became a stripper by night and went to Law School by day.  Graduated from Law School and desided that the legal industry wasn’t for me either.  So I got married finally, well that wasn’t for me either.  So now I’m one year remove from my divorce (no kids). Well I met up with a college friend, and we went into business together.  So now I own a health-club and am planning to open another club.  I presently do a little real estate developing and have a few property things going.  Still in Chico, and wishing I could afford to move back to Morgan Hill.

Somehow, the author of this statement was able to borrow $2 million dollars in late 2006 – and walk away with $500,000 (estimated) cash.

My conclusion = Derek David Malig is not smart enough to perpetrate this scam on his own.  He had help.

Cahoots

The obvious “mastermind” is Pete Capra at Golden Design Group - in cahoots with the likes of Dick Fuld, Alan Faigin, and Jim Wells.

Mr. Fuld publicly said, “This is my responsibility”.  I agree.  While it certainly is true he’s not the only one – Richard Fuld is personally responsible for the fraudulent mortgage loans at Lehman.  And it’s a big number.

Jim Wells made the fraudulent mortgage loan at 16733 Lake precisely because he knew that if he didn’t – Alan Faigin at Fremont Investment and Loan would.

Alan Faigin and the bank formerly known as Fremont Investment and Loan consented to a Cease and Desist Order issued by the FDIC.  The new name is Capital Source (CSE).  I did not see any estimate of how much this will cost the American taxpayer.  My best guess is $3 billion.  This is not small potatoes.

Henry Paulson says (7/22/08) “the nation’s banking system is fundamentally sound”.  I say the system is badly broken.  One of us is right.

Robert C Zwinck, III

Robert C Zwinck, III is/was the chief technology officer at FHS Corp.  It’s just my opinion, but I think Robert Zwinck is right now trying to do to the health care industry what he did to the mortgage lending industry in 2006.  Or, maybe it’s 2 different people with the same name.  Or maybe it’s (another?) case of identity theft.

12542 S Robinson Ranch Dr, Parker, CO  80134 (Douglas Co) – February 2002 Robert C Zwinck, III bought himself a house.  The sale price is recorded as $549,800.  This was a builder sale, he bought the house brand new from Beazer Homes.  Presumably Mr & Mrs Zwinck moved in and lived there.  This house went on the market 8/12/05 and stayed on the market (more or less continuously) until sold 01/08/08 for $545,000 – approximately 740 days on market.  The property is now owned by “Done Deal Investments, LLC” (I’m not making this up) and Lisa M Coe – thanks to a 14% mortgage loan by Jim Wells and the good people at SunTrust.

What could possibly go wrong here?

5550 Vistancia Dr, Parker, CO  80134 (Pradera) – Approximately March 31st, 2006 Robert C Zwinck, III bought this property for $992,700.  The seller was Golden Design Group – Pete Capra.  The sole purpose of this transaction was to generate excess mortgage funds, a/k/a cash back at closing, a/k/a mortgage fraud.  Nobody ever moved in and Bob Zwinck never made a payment.

My best guess is that Mr. Zwinck got a mortgage loan of $992,700.  The public records shows that Aurora Loan Services (a/k/a Lehman Brothers a/k/a Dick Fuld & the Bros) was involved in the mortgage.

The MLS listing history shows the property back on the market two weeks later with an asking price of $1,042,000.  About a year later the price had been increased to $1,192,000 – but no sale.  After 675 days on market, the property sold (short sale) for $665,000 on 3/10/08.  That’s $327,700 short of the loan – in about 2 years time.

16754 E Lake Dr, Centennial, CO  80016 (Piney Creek Village).  About 2 months after he bought 5550 Vistancia, and while 12542 Robinson Ranch was still on the market – Robert C Zwinck, III bought himself a 3rd house.  Does anyone see a problem here?

On 5/19/06 Robert Zwinck bought this property for $890,700 from Golden Design Group a/k/a Pete Capra.  The sole purpose of this transaction was to generate excess mortgage funds, a/k/a cash back at closing, a/k/a mortgage fraud.  Nobody ever moved in, and Robert Zwinck never made a payment.  This property went into foreclosure.  The REO listing says, “never been lived in”.

It sold 4/8/08.  The new owners are Aleksander Shleyfer and Margarita Feldshteyn (I’m not making this up).  The property sold for $499,000 after 325 days on market.  That’s $391,700 short of the loan amount in about 1 year’s time.

9559 Sunset Hill Dr, Lone Tree, CO  80124 (Douglas Co).  On 5/25/06, Robert C Zwinck, III bought yet another property. He bought this property from Thomas Turner for a smooth $999,000.

This property sold as a short sale on 5/7/08 for $667,000 after 104 days on market.  That’s $332,000 short of the loan amount.

Michael Stone

5540 Vistancia Dr, Parker, CO  80134 (Pradera) – Approximately August 14th, 2006 Michael Stone bought this property from Golden Design Group for $999,000.  Dick Fuld and the Bros were mixed up in the mortgage.

The sole purpose of this transaction was to generate excess mortgage funds, a/k/a cash back at closing, a/k/a mortgage fraud.  Nobody ever moved in, and Michael Stone never made a payment.  The REO listing says:  “Looks like it has never been lived in” – a/k/a barely lived in.  Indeed.

This property went into foreclosure, then sold 3/20/08 for $630,000.  This property lost $369,000 value in about 18 months time – about $20,000 per month.

Dick Fuld & the Bros

In my letter dated 06/04/08 I said Dick Fuld made a $33M bonus precisely because of all the bad loans at Lehman.  I believe the above 2 examples (5540 and 5550 Vistancia) showed up as a profit on the 2006 Lehman financial statements.

This NY Times article dated 6/18/08 says

Lehman said it would raise $6 billion to shore up what the firm had previously suggested was a strong balance sheet.

I take it to mean that Lehman (Dick Fuld) told some whoppers about what went on in 2006.  When the NY Times says “previously suggested” it’s a polite way to say Dick Fuld lied.  And in June of 2008, he’s still at it.

This article dated 06/18/08 quotes Dick Fuld:

“I’m comfortable with our valuations at the end of the second quarter,” Fuld said on a conference call with analysts and investors.

Referring to the Sarbanes-Oxley law that holds executives responsible for their firm’s accounting, he added, “I am the one who ultimately signs off.”

Fuld demoted (fired?) Erin Callan and Joe Gregory – and then Mr. Fuld said, “This is my responsibility”.

The Lehman Bros 2006 financial statements were audited by the “independent” CPA firm Ernst + Young, LLP.  Does the audit by Ernst and Young mean anything?

Does the Dick Fuld signature on the Sarbanes-Oxley statement mean anything?  Or not?

How bad does it have to get?

Sincerely,

Philip G Rice
11268 E Linvale Dr
Aurora, CO  80014
720-282-3376
phil.rice@mkgappraisal.com

ps – To all who have read this far, please take a minute and think creatively about something you can do.  Make a positive difference.  If you need help, call me at 720-282-3376 or send an email.

– End of Letter –

Posted in Appraisal, Mortgage Fraud, Politic, Skippy, Stupid Lender Tricks | No Comments »

Richard L Hanna

Monday, July 21st, 2008

July 21st, 2008

FBI
935 Pennsylvania Avenue, NW
Washington, DC 20535
Attn:  Robert S Mueller, Director

via snail mail
to:  distribution list /with attachments

Dear Bob Mueller

Please treat this as a formal complaint with regard to mortgage fraud – against Richard L Hanna, Jason Stephens, Ray Sherman, Steven Gage, Kerry K Killinger, Victor Ciardelli, Pete Capra, and all of the executives at Golden Design Group, Indymac, New Century Mortgage, Biltmore Bank of Arizona, Silver State Mortgage, DR Horton, Keller Williams, Vision Development Group, and the board of directors at Washington Mutual.

By copy of this letter to D. Rico Munn and Erin Toll, please treat this as a complaint against the mortgage broker license of Peter Vincent Capra (LMB100009013).  In addition, please treat this as a complaint against the real estate license of Jason Stephens (FA40021244) and his employing broker at Keller Williams – presumably Ray Sherman (EL93630).

By copy of this letter to various federal, state, and local agencies, please treat this as a complaint against each of the individuals and business entities named below.

Once Upon a Time

Once upon a time there was a hot shot golfer with a smart ass caddy.  The golfer hit the ball into the deep rough.  When they found the ball, the golfer said to the caddy – if you’re so smart, how should I play this next shot?  The caddy said – under an assumed name.

Assumed Name

There is a politician in upstate New York who goes by the name Richard L Hanna.  As near as I can tell, he is a Republican.  I don’t know if the NY politician is the same Richard L Hanna who has been buying up properties in Colorado.  It seems far fetched to me.  I’m thinking it must be 2 different people who share the same name – or maybe it’s a case of identity theft.

Now that I think of it, there is a very strange (far fetched) question about Michael R McCormick.  Is the mass murder the same person who worked at the AG’s office?  Or is it 2 different people with the same name?  Or is it identity theft?

Disclaimer

All of the information in this letter is my interpretation of information in the public records.  It’s my opinion – take it for what it’s worth.

Hi Ho Silver

photo

261 Lead Queen Dr, Castle Rock, CO  80108 (Douglas Co) – On June 30th, 2006 Richard L Hanna bought himself a house.  He paid $1.2M and got a mortgage loan to match from the good people at New Century Mortgage.  Since then – New Century has gone bankrupt and this property went into foreclosure.  The MLS listing history shows the property has been on the market since February 2008 and the current asking price is $675,000.  That’s $525,000 less than the loan.

The listing history makes it clear that there was some serious mortgage fraud in the June 2006 transaction.  The sole purpose of this transaction was to generate excess mortgage funds – a/k/a cash back at closing – a/k/a mortgage fraud.  The (roughly $550,000) excess funds were divvied up amongst the buyer, seller, 2 real estate agents, appraiser, mortgage broker, and lender.  Did I leave anyone out?

Everyone has been well trained by HUD in the process of manipulating the paperwork to make the deal work.  Everyone knows what needs to get done, and everyone does their part.  And everyone gets paid.

Jason Stephens (FA40021244) of Keller Williams was the listing agent and also the selling agent.  He increased the asking price by $300,000 and reported a seller concession of $17,568.  I think Jason Stephens and his supervisor should both have their real estate license revoked.

Dear Erin Toll

Question for Erin Toll:  Is this a good example of when the listing agent should ask themselves the questions outlined in the Summer 2008 Newsletter (page 7)?  Are you thinking (hoping?) that Jason Stephens and Ray Sherman should have decided this was mortgage fraud?  Or not?  And if they somehow decided it was mortgage fraud – then what?

What exactly should they have done?  Should they have quietly walked away from the $66,000 commission?

Two Potato

2282 Dogwood Dr, Erie, CO  80516 (Weld Co) – About a month later (7/31/06) Richard L Hanna bought himself another house.  The sole purpose of this transaction was to generate excess mortgage funds – cash back at closing – mortgage fraud.

He paid $387,500 and got a mortgage loan from Axis Mortgage & Investments (a/k/a Biltmore Bank of Arizona).  This was a builder (DR Horton) sale, not listed or recorded on MLS.  This property went into foreclosure.  It went on the market in February 2008 – asking $350,000 as an REO property.  It’s still on the market – now asking $259,950.  About $127,000 less than the loan amount.  Small potatoes – who cares?

Three Potato

16402 E 107th Ave, Commerce City, CO  80022 (Adams Co) – About a week later (8/7/06) Richard L Hanna bought himself another house.  The sole purpose of this transaction was to generate excess mortgage funds – cash back at closing – mortgage fraud.

The sale price is recorded as $302,500 with a loan to match by Axis Mortgage & Investments (a/k/a Biltmore Bank of Arizona).  This was a builder sale, not listed or recorded on MLS.  This property went into foreclosure.  It recently (7/9/08) sold for $209,000 – about $92,000 less than the loan amount.  Small potatoes – who cares?

Four Potato

11336 Jersey Dr, Thornton, CO  80233 (Adams Co) – About a month later (9/1/06) Richard L Hanna bought himself another house.  The sole purpose of this transaction was to generate excess mortgage funds – cash back at closing – mortgage fraud.

The sale is recorded at $329,000 with a mortgage loan to match by Victor Ciardelli and the good people at Guaranteed Rate, Inc.  This property went into foreclosure.  It sold 7/9/08 for $230,000.  About $100,000 less than the loan amount.  Small potatoes – who cares?

More

528 Nesting Crane Ln, Longmont, CO  80504 (Weld Co) – About a year later (8/29/07), Richard L Hanna bought himself some land.  It’s not clear if he intended to start a potato farm.

The sale is recorded at $475,000 with a mortgage loan provided by bank formerly known as Indymac Bank FSB.  If anyone reading this has any money on deposit at Indymac – my advice is to run to the bank and withdraw your money.

The sole purpose of this transaction was to generate excess mortgage funds – cash back at closing – mortgage fraud.  This property went into foreclosure.  It’s now listed for sale at $195,000.  About $280,000 less than the loan amount.

Indymac.  FDIC.  Does anyone see a problem here?  FBI.

The FBI investigation is focused on the company [Indymac] – which was taken over last Friday by the Federal Deposit Insurance Corporation – and not individuals who ran it

CNN Money article dated 7/11/08:

The FDIC says the failure will cost the Deposit Insurance Fund between $4 billion and $8 billion

Don’t Worry Be Happy

“It’s possible this will be the most costly bank failure in history, but it’s too soon to say,” said FDIC Chairman Sheila Bair.  She went on to say “People should not worry”.

Q – At $280,000 a pop, how many potatoes does it take to get to $4 to $8 billion?  And as a follow up – at $4 to $8 billion a pop, how many Indymacs does it take before “people” should worry?

A- Hello?  Is anybody home?

Big Potato

16733 E Lake Dr, Centennial, CO  80016 (Arapahoe Co) – about 2 months later (11/3/06), Richard L Hanna bought himself yet another house.  The sole purpose of this transaction was to generate excess mortgage funds – cash back at closing – mortgage fraud.

This was a builder sale – he bought the house from Pete Capra and the Golden Design Group.  The sale price is recorded at $1,150,000 (that’s over a million dollars) with a $1,150,000 mortgage loan provided by Silver State Mortgage.

About 2 months later Silver State Mortgage went kaput.  Connect the dots.  I think the CEO at Silver State Mortgage should spend some time in the Martha Stewart jail cell.

This property went into foreclosure.  It’s now on the market – asking $605,000.  That’s a smooth $600,000 less than the loan amount – and that’s before expenses.  Somebody is getting screwed on this one.  And it ain’t over yet.

More Big Potato

5045 McClure Ln, Castle Rock, CO  80108 (Douglas Co).  About a year later (12/19/07) Richard L Hanna bought himself another house – brand spanking new from Steven Gage and the good people at Vision Development Group.  The sole purpose of this transaction was to generate excess mortgage funds – cash back at closing – mortgage fraud.  Nobody ever moved into the house – a/k/a barely lived in.  Richard L Hanna never made a payment.

The sale price is recorded at $1,585,000.  The good people at Washington Mutual made a mortgage loan of at least $1,188,750.  I’m of the opinion there was an unrecorded 2nd mortgage and the total loan was $1,585,000.

This property is now on the market with an asking price of $899,000.  That’s $686,000 less than the sold price.

Let me say that again – this property lost $686,000 value in 8 months – darn near $100,000 per month.  And of course it ain’t over yet.  It could get worse.

Richard L Hanna has some big potatoes.

photo

Does anyone see a problem here?

How many more potatoes will it take to push Washington Mutual into bankruptcy?  If you have any money on deposit at WaMu – my advice is to run to the bank and get your money out before Chuck Shumer writes another letter.  Don’t count on Ben and Tonto to decide that WaMu is too big to fail.

Untenable

This is how hispanicbusiness.com reported (7/8/08) what Henry Paulson (a/k/a Tonto) had to say:

But the Treasury chief made no apologies for those who either have or are about to lose their homes either because they were speculators or because they overextended themselves by purchasing homes they couldn’t really afford.

“There is little public policymakers can, or should, do to compensate for untenable financial decisions,” he said.

My question – What about WaMu?  Are they tenable?

For those who live in upstate New York – my advice is to carefully consider your vote in the upcoming election.
How bad does it have to get?

Sincerely,

Philip G Rice
11268 E Linvale Dr
Aurora, CO  80014
720-282-3376
phil.rice@mkgappraisal.com

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Elizabeth Butler / Steffen A Brown

Sunday, July 13th, 2008

I filed 2 complaints against the appraiser’s license of Elizabeth Butler. Complaints dated 9/19/05: 476 Kenton and 1657 Sedalia. At the time I filed these complaints, Stewart Leach was running the show at the Colorado Board of Real Estate Appraisers. By the time the complaints were acted on, Stewart had been fired and replaced by Erin Toll.

The Rest of the Story

Butler response – document dated February 13, 2006. 4 pages:

Discipline document – stipulation and final agency order – case number 80356872 dated 5/7/07. $1,000 fine and 55 hours course work.

Open Records request – document dated 5/15/08. Billed at $15.75

Investigator (Steffen A Brown) Findings for Kenton. Document is not dated and not signed. 4 pages:

Investigator (Steffen A Brown) Findings for Sedalia. Document is not dated and not signed. 4 pages:

Payment and course completion confirmation – document dated 1/14/08 signed by Martha Torres-Recinos. 5 pages of backup.

My Comments

This is a comedy of errors – except it’s not funny.

Elizabeth Butler could have completely avoided the fine and the course work if she had just threatened to show up and defend herself at a hearing. Erin Toll would have backed down and settled for a fine of $zero and no course work.

The Investigator Steffan A Brown is a good example how the status quo is defended and why substantive change is like pulling teeth.

To be clear – I have no problem with the end result. If anything I consider a $1,000 fine and 55 hrs course work to be excessive. It is not clear to me how the process went from Mr Brown’s findings to the end result.

I do have a problem with the comments and conclusions expressed by Steffan A Brown. I don’t have time to go thru each of Steffan A Brown’s comments point by point. I offer a summary and a few representative examples with my comments and analysis.

In the Salida “findings” document – Steffan A Brown does find a violation of Standards Rule 1-1(a)(c) with comments on page 2.

In the Kenton “findings” document – Steffan A Brown could find no evidence or support of any violation by Elizabeth Butler. He does say that Phil Rice “does not fully understand the appraisal process or the meaning of opinion of value”.

My comment – if you wanted to actively discourage the public from submitting complaints – what better way to accomplish that objective than to make (unsupported) insulting and disparaging comments about the person who submitted the complaint? I don’t agree with his conclusion – but even if he is correct – what does the comment say about the person who wrote it? And what does it say about the complaint process?

Steffen A Brown says that USPAP “Advisory Opinions are not mandatory” because they are provided as “guidance only”. Therefore (if I’m reading it right) Steffen A Brown is of the opinion that it is not mandatory for the appraiser to take into account (consider) the listing, agreed price, and pending sale of the subject property. My comment = I disagree.

Under the heading Findings VI (Kenton pg3) Steffen A Brown says:

Elizabeth Butler admits the oversight by not changing the “N/A” on page 1 to reflect [the subject property] seller concessions but did reference the $10,000 concessions in the Multi-Purpose Supplemental Addendum on page 2 under “Current Sales Contract”. This is an error due to lack of reviewing ones own work but it was reported and there is no substantial error of omission.

Steffen A Brown says says he found no evidence or support for my allegation that Elizabeth Butler is unethical.

Elizabeth Butler says (response pg1):

I always pull comps and submit them. If the value is not there I am not given the assignment. This is much better than having companies spend their money needlessly and me facing a law suit.

I wonder if Steffen A Brown read this statement. If Steffen A Brown can’t find anything unethical in that statement, I have to wonder what it would take.

How bad does it have to get?

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Michael McCormick

Tuesday, July 1st, 2008
July 1st, 2008FBI
935 Pennsylvania Avenue, NW
Washington, DC 20535
Attn: Robert S Mueller, Director

via snail mail
to: distribution list /with attachments

A complete copy of this letter (including all attachments) is published on the Internet at:

http://www.mkgappraisal.com/letter2008_mc.htm

Dear Bob Mueller

Please treat this as a formal complaint with regard to mortgage fraud – against Demetrius Gianopoulos, Michael R McCormick, Andy Mitchell, Angelo Mozilo, and Pete Capra. In addition, please treat this as a complaint against the CEO and each of the following business entities: New Century Mortgage (now kaput), WMC Mortgage and the parent General Electric, South Star Funding (now kaput), Countrywide, Golden Design Group, and First Guaranty Financial Corp.

By copy of this letter to Mary Mullarkey, please treat this as a complaint against the attorney license of Michael R McCormick.

By copy of this letter to D. Rico Munn and Erin Toll, please treat this as a complaint against the real estate license of Andy Mitchell and the inactive real estate license of Demetrius Gianopoulos (FA100004301).

By copy of this letter to various federal, state, and local agencies, please treat this as a complaint against each of the individuals and business entities named below.

Ruby Begonia

Question for Ken Salazar and John Suthers: Do the name Michael R McCormick mean anything to you? He claims to have worked at the Colorado Attorney General’s Office for 3.5 years.

photoA Google search suggests that Michael R McCormick is an attorney at Montgomery Little Soran etc. His cv page says: Michael R. McCormick entered private practice after spending three and a half years as an Assistant Attorney General in the Colorado Attorney General’s Office representing the Colorado Department of Transportation.

The name Michael McCormick shows up as the current owner on 7 Arapahoe county properties in some stage of foreclosure.

  1. 1104 S Richfield Ct
  2. 21582 Portland Pl
  3. 242374 E Glasgow Cir
  4. 16731 E Lake Ave
  5. 14120 Temple Dr Y-1
  6. 6019 S Olathe St
  7. 22382 E Mercer Pl (Countrywide)

The name Jenell B McCormick also shows up on several foreclosure properties. I don’t know if Jenell is related to Michael. My best guess is they are not related.

Michael McCormick is somehow involved with Equity Architects, LLC , an outfit located in California. Equity Architects is headed up by M. Cassandra Hoag, who is also a director at Sunwest Bank.

The Greek

Demetrius G Gianopoulos. Is that a good name? It’s Greek to me.

photo 21582 Portland: Approximately November 22, 2004, Demetrius purchased the house at 21582 E Portland Pl, Aurora, CO 80016. The sale was not reported in MLS. The Arapahoe county deeds report shows the sold price at $699,000 with a mortgage loan of $699,000 provided by the Bozos at (now kaput) New Century Mortgage. Six months later in May 2005 the house was back on the market asking $791,000. A month later in June, 2005 the asking price was increased to $899,000. MLS shows the property “under contract” in June of 2005 but there is no sale reported. About this time the property went into foreclosure. Two years later on 9/27/07 via quit claim, Michael R McCormick was listed as the owner. In December of 2007 (3 months after Michael McCormick was the owner) the property was listed for sale asking $575,000. This property sold 6/18/08 for $446,250. That’s $252,000 short of the loan amount – in 3.5 years.

Does anyone see a problem here?

Imagination at Work

6019 Olathe: Three weeks later – on December 22, 2004 Demetrius bought himself another house. 6019 S Olathe St, Centennial, CO 80016. Sold price = $896,000 with a mortgage loan to match – provided by WMC Mortgage (a/k/a GE). The sale was not reported in MLS. This property went into foreclosure. Equity Architects recorded a $60,500 loan on October 29th, 2007. I suspect this house was barely lived in. This property recently (5/28/08) sold for $570,000 which is $326,000 less than the loan amount. Imagine that.

16731 Lake: Three weeks later on January 11th, 2005, Demetrius bought himself another house. Just around the corner at 16731 E Lake St, Aurora, CO 80016. Sold price = $865,000 with a mortgage loan to match provided by the rascals at Southstar Funding (now kaput). Presumably this was a builder sale – it was not listed or reported in MLS. Demetrius bought the house from Pete Capra a/k/a Golden Design Group for the sole purpose of walking away with the excess mortgage funds – cash back at closing – a/k/a mortgage fraud. I estimate the mortgage fraud at $150,000 for this one transaction. Much the same as Young Kim just around the corner at 6062 Kalispell. Yep – this property went into foreclosure. Somehow Countrywide is mixed up in this mess. Equity Architects recorded a $60,500 loan on October 29th, 2007. This property is currently for sale asking $589,900. That’s $275,000 less than the mortgage, and it ain’t over yet.

In a span of about 6 weeks, Demetrius was able to borrow $2.46M – presumably on the strength of his good name. Is that a good name? Or not?

You might be thinking Demetrius put up $zero of his own money – but that’s not what I’m thinking. I think Demetrius (or someone) walked away from these 3 transactions with the better part of $500,000 cash. Not bad for 6 weeks work.

But wait. It gets better.

23957 Hinsdale: Three weeks later – January 31, 2005, Demetrius bought a 4th property. 23957 Hinsdale Pl, Aurora, CO 80016. Sold price = $780,000 with a $741,000 loan provided by the good people at First Guaranty Financial Corp. Demetrius bought the house from Pete Capra a/k/a Golden Design Group for the sole purpose of walking away with the excess mortgage funds – cash back at closing – a/k/a mortgage fraud. I estimate the mortgage fraud at $205,000 for this one transaction. The sale was not reported in MLS. This property went into foreclosure. In October of 2007 it was on the market with an asking price of $800,000. It’s still on the market – the asking price has been reduced to $519,000 and still no takers. That’s $261,000 less than the mortgage loan, and it ain’t over yet. Somebody is getting screwed on this one.

photo 5745 Amber Ridge: About 7 months later – August 29th, 2005. Demetrius bought his 5th property. 5745 Amber Ridge Pl, Castle Rock, CO 80108. Sold price is $1.5M. The Bozos at Countrywide made a mortgage loan of $1,350,000 (maybe more) to Demetrius Gianopoulos on August 29th, 2005. This property had been on the market 263 days with an asking price of $1,249,000. Any idiot could see this property was not worth $1.35M. Andy Mitchell was the real estate agent for both sides of this transaction. Andy raised the price $251,000 and reported a seller concession of $362,000 in MLS. The concession type is listed as “cash” – as in $362,000 cash back at closing. Think about that for a minute.

And just when you think it can’t get any more ridiculous – it does.

Visions of Sugar Plums

One week later this property went back on the market with an asking price of $1.6M. By November of 2006 (447 days later) the asking price had been increased to $1.85M. Then the property went into foreclosure and the Cracker Jack REO team at Countrywide went into action. They listed the property December 13th, 2007 with a significant price reduction – the asking price started at $1.263M. This same property is still on the market – the asking price is now $949,000. Somebody is getting screwed on this one.

Fruit Cake

24237 Glasgow Cir, Aurora, CO 80016. It’s hard to tell exactly what happened – but Demetrius Gianopoulos, Michael R McCormick, Lehman Bros, and Fifth Third are knee deep and it smells bad. I see a $725,000 loan approximately April 2004. Then the property was on the market in November of 2007 asking $540,000. No sale is recorded in MLS, but somehow a $636,000 mortgage is recorded a month later on December 12th, 2007 with the sale price listed as $795,000. The names Lehman Brothers structured asset investment loan trust, Fifth Third Mortgage Co, Gloria Kindelson, Justin Foos, Patrick Shanley, and Demetrius Gianopoulos all show up on the paperwork. Arapahoe county shows the current owner is Michael R. McCormick. I’ve formed an opinion that some of these people told lies for the purpose of getting their hands on some cash. Yep – this property is in foreclosure.

So Now What?

Ken Salazar is pushing a bill that would have the Federal Government pay $8,000 to a home buyer. The idea being it’s easier to sell houses if “we” could just pay people to buy a house. If enough people start buying houses the real estate market will recover and then we can get back to normal. Of course “we” would not give any money to speculators. Speculators are the bad people who are making gas prices go up. Only genuine real people will be eligible for the $8,000 government incentive program.

Hello? $8,000 cash back from the government is not the solution. Paying people to buy houses is what got us into this mess. “Cash back at closing” is the problem, it’s not the solution.

I have been speaking out publicly since September of 2005. I sent a letter to Governor Ritter 1/26/07 with extensive details about Justin Juarez and his involvement with several big ticket mortgage fraud transactions. Justin still has his real estate license. If anyone did anything about Justin and the mortgage fraud it’s a well kept secret.

How bad does it have to get?

Sincerely,

Philip G Rice
11268 E Linvale Dr
Aurora, CO 80014
720-282-3376
phil.rice@mkgappraisal.com

ps – To all who have read this far, please take a minute and think creatively about something you can do. Make a positive difference. If you need help, call me at 720-282-3376 or send an email.

– End of Letter –

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Pete Nemeth

Tuesday, June 24th, 2008

June 24th, 2008

FBI
935 Pennsylvania Avenue, NW
Washington, DC 20535
Attn:  Robert S Mueller, Director

via snail mail
cc:  distribution list /with attachments

A complete copy of this document is published on the Internet at:

http://www.mkgappraisal.com/letter2008_07.htm

Dear Bob Mueller

I read the FBI press release dated 6/19/08 about operation malicious mortgage.  Since March 1st – 144 cases with 406 defendants charged.  According to the local news media – none of these cases are located in Colorado.

Please treat this as an official complaint against Peter P. Nemeth and the mortgage broker (presumably Rob Gremminger) and the appraiser(s) (identity unknown) and James M. Wells, III, and SunTrust for mortgage fraud associated with the $999,000 mortgage loan dated (on or about) 10/25/06 for the property at 16866 E Lake Ave, Aurora (and/or Centennial), CO 80016.  In addition, this is a complaint against Pete Capra and Golden Design Group and Distinctive Mortgages for mortgage fraud on approximately 300 transactions in Piney Creek Village, Colorado with an estimated mortgage fraud of $50,000 to $250,000 for each transaction.

By copy of this letter, I am filing a complaint against all of the above named persons and entities with the Arapahoe County District Attorney, Colorado Attorney General, Colorado Bureau of Investigation (CBI), the SEC, HUD, VA, FDIC, Office of Thrift Supervision, OFHEO, Fannie Mae, Freddie Mac, and David E. Nahmias.

By copy of this letter – I am filing a complaint against the real estate license of Pete Nemeth and the mortgage broker license of Rob Gremminger.

Young Kim

I begin with a brief summary/update of Young Kim.

A Google search on “young kim” and “mortgage fraud” suggests that Young Kim is a common name.  GREFPAC has a story about a Georgia Young Kim mortgage fraud, and there is also a New York City Young Kim fraud.

I wrote about the Colorado Young Kim in August of 2006.  She went on a shopping spree and bought 10 houses during a 7 month period in 2006.  It’s clear that each of the properties was purchased for the sole purpose of “cash back at closing” from the excess mortgage funds – i.e., mortgage fraud.  My best estimate is that Young Kim (or someone) pocketed $500,000 “cash back at closing” from these 10 transactions.

Young Kim’s first house was bought with a Lehman Bros loan, and number 10 on the list was a (darn near) million dollar house in Piney Creek Village.  She bought 6062 S Kalispell brand spanking new from Pete Capra a/k/a Golden Design Group for $986,000.

photo

Barely Lived In

We now know that all 10 of the Young Kim properties went into foreclosure.  6062 Kalispell recently (6/6/08) sold for $615,000 – that’s $371,000 less than the mortgage loan.  The listing agent for the REO sale (Debra Gleason) said the house was “barely live in”.  Indeed.

It seems odd to me that Debra has not (yet?) reported the sale in MLS – perhaps she knows something I don’t.

With that background, let’s have a look at a few other houses from the same neighborhood.

In the Hood

There are 21 houses on the 16700 block of Lake Ave in Piney Creek Village.  All built in (approximately) 2002.  9 of the 21 houses are listed on the Arapahoe County foreclosure Website (16795 went twice).

  1. 16711 E Lake Ave – Lorenzo D Phillips
  2. 16713 E Lake Ave – Nicholas J Beal
  3. 16731 E Lake Ave – Michael R McCormick and Demetrius G Gianopoulos
  4. 16733 E Lake Dr – Derek David Malig
  5. 16751 E Lake Ln – DSL Investments, LLC
  6. 16754 E Lake Dr – Robert Zwinck
  7. 16773 E Lake Dr – Richard L Hanna
  8. 16793 E Lake Dr – Dwayne Alton Norman, Sr
  9. 16795 E Lake Dr - Eric Singer
  10. 16795 E Lake Dr – (again) Marjorie Patterson

Many of these houses are “barely lived in”.  Q – How many of these properties were involved in blatant mortgage fraud?  A – All of them.

16795 E Lake Dr “sold” (I use the term loosely) on October 27th, 2006.  The sale was not reported on MLS.  The Bozos at SCME Mortgage Bankers made a $930,000 loan.  This was a ridiculous loan because this property was never worth $930,000.  A year later SCME was kaput.  16795 E Lake Dr is currently listed for sale on MLS asking $512,950.  That’s $417,000 less than the mortgage loan – in less than 2 years time.  Somebody got screwed on this one.

Pete Nemeth

In January of 2004 Pete Nemeth owned (at least) 2 houses.  91 Blue Heron Dr in Greenwood Village and 15638 E Powers Dr in Centennial.

Approximately January 23rd, 2004 Pete Nemeth bought a 3rd house.  He bought 16866 E Lake Ave – located in Piney Creek Village – the same neighborhood as Demetrius G Gianopoulos and Young Kim.

The purchase price is recorded as $780,000.  I have formed an opinion that Pete Nemeth bought this property from Golden Design Group (the builder), for similar reasons and with similar terms to the Young Kim sale.

Six weeks later, Pete put the property back on the market with an asking price of $814,900 – an increase of $35,000 over what he paid.  About a year later, in April of 2005 the price was $795,000 and still no takers.  Dang.

Pete then raised the price to $860,000.  A month later – still no sale.  Pete then raised the price to $970,000.  Five months later on October 6th, 2006 the listing expired with a final asking price of $950,000.

If you were thinking the problem was the price was too high – you would be wrong.

About a week after the MLS listing expired, approximately 10/25/06 Pete Nemeth sold 16866 E Lake Ave to Alva Tolliver for $999,000.  The sale was not reported in MLS.

photo

You might be thinking Pete Nemeth was lucky to sell for $219,000 more than he paid and a smooth $49,000 more than the MLS asking price.  I have formed an opinion that “luck” had nothing to do with it.  Alva Tolliver obtained a $999,000 mortgage loan from the good people at SunTrust Mortgage.  The property promptly went into foreclosure.  This property was “barely lived in”.

The house at 16866 E Lake Ave in Aurora, CO is now listed on MLS with an asking price of $629,900.  That’s $369,000 less than the mortgage loan – in about 18 months.  That works out to $20,000 per month.  And that’s before expenses.  Somebody is getting screwed on this one.

Atlanta Fraud Ring Convicted

This article in the Atlanta Business Chronicle gives details about a situation at SunTrust.  The headline is:  Metro Atlanta Fraud Ring Convicted.  I see some striking similarities between the Atlanta Fraud Ring and Pete Nemeth.

The article says in the summer of 2006 a SunTrust employee named Latesha Garner and her father somehow duped the management at SunTrust into making bad loans.  The article would have us believe SunTrust is/was the victim.  I wonder if Latesha had anything to do with the loan at 16866 E Lake Ave.  My best guess is that she did not.

I wonder if Jim Wells had anything to do with the $999,000 mortgage loan at 16866 E Lake Ave.  My best guess is that he did.

photo

It Ain’t Over

Can we agree there is a problem?  How many think of the problem in the past tense?  How many think this won’t happen again?

How To

For those who would like to design the lifestyle you deserve – I recommend you sign up for this local seminar.  It was presented on May 28th, 2008.  I’m not sure when the next one is scheduled – but I think if enough people express interest, it won’t take long.

Seminar presenters include Pete Nemeth, Associate Real Estate Broker with Keller Williams Executives in Highlands Ranch; Michael McNamara of Brentwood Equity Advisors, Inc., founder of the “Wealth Without Wall Street” e-book and seminar/webinar series; and Rob Gremminger, Austin Financial Consulting LLC, a CPA and licensed mortgage broker.

Peter Nemeth is the “lucky” seller at 16866 E Lake Ave.  Pete Nemeth is also a licensed real estate agent.  Colorado license number FA40039284.  Employing broker is Grant Dolby at Keller Williams.

Rob Gremminger, Austin Financial Consulting LLC, a CPA and licensed mortgage broker.  Colorado license number LMB100011393.

Conclusion

SunTrust is making mortgage loans in Aurora, CO at the rate of 30 per month.  My best guess is that nearly all (90%?) of these loans involve the same hocus pocus as 16866 E Lake Ave.  The only difference is the dollar amounts are smaller.

For example – 1190 Fulton Street sold 3/17/08.  Asking price in MLS was $84,900.  After 94 days on market, the property sold for $90,000 with an FHA loan provided by James M Wells, III and the good people at SunTrust.

Hey Jim Wells – clean up your act.

Pete Nemeth, James M Wells, III, Young Kim, Dick Fuld, Angelo Mozilo, Richard Berst, Justin M Juarez (remember him?) and the executives at SCME, et. al., all get paid on commission.  If they get to keep the money, it’s just a matter of time before somebody else comes along to do it again.  And again.

Sincerely,

Philip G Rice
11268 E Linvale Dr
Aurora, CO  80014
720-282-3376
phil.rice@mkgappraisal.com

ps – To all who have read this far, please take a minute and think creatively about something you can do.  Make a positive difference.  If you need help, call me at 720-282-3376 or send an email.

– End of Letter –

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