Dear Governor Ritter

February 02, 2007

Governor Bill Ritter
136 State Capitol
Denver, CO 80203

Appraisal Fraud

This is a complaint against the real estate and/or appraisal license of James L Esters (AL40033702), Jeannette L Esters (AR100008468), Ashlie M Woods (FA40022880) and her employing broker at Leonard & Leonard, Sonja Leonard (EC51960).

The appraisal report presented in this complaint is the most blatant example of appraisal fraud I have ever seen. This appraisal report was submitted to a local lender as part of an unsuccessful attempt to obtain a mortgage loan.

The subject property is 670 Pearl St , Denver, CO 80209. Effective (inspection) date is 05/20/06 and the report is signed 05/24/06. The client is shown as Property Solutions Corp at PO Box 29292, Denver 80229.

Appraised value $730,000 as of May 20th, 2006. On that date, the publicly stated asking price in MLS was $499,000. The appraisal report does not disclose the asking price. The appraisal offers no analysis or explanation of how the appraised value is $230,000 more than asking price.

The MLS Listing clearly indicates the subject property is a multifamily. No indication of this in the appraisal report.

Comp #3, #4, and #5 photos lifted from MLS. Amazingly, the primary subject photo used in the appraisal report was lifted from MLS. The use of MLS photos is not disclosed in the report.

The appraisal report specifies neighborhood boundaries as Virginia to the north, Downing to the east, Kentucky to the south, and Broadway to the east. Comps #1, #2, #4 and #5 are all from outside these boundaries. Comp #3 is the only comp in the neighborhood. The appraisal report shows the neighborhood values as $650 - $1.0M, with $750 predominant. My CMA shows 97 sales in the past 12 months -- from $155 to $906 with $366 median. Anyone familiar with this neighborhood knows Jim Esters neighborhood values are pulled from air.

My investigation (details available on request) shows that Anthony Telitz bought a property at 1335 E 100th Ln, Thornton, CO 80229 in early May, 2005 (a few weeks before this attempted purchase). I would describe the Telitz purchase as suspicious at best. By copy of this letter, I am requesting "the authorities" pursue criminal charges against James L Esters, Michael Rangel, and Javier Tafoya, Anthony Telitz.

James L Esters was the subject of an extensive article published in the Denver Post. James L Esters is the subject of BOREA discipline action - case number 805-5199 and 80356820, Stipulation and Final Agency Order dated June of 2006, and additional charges have been filed.

The date of the discipline document is important, because the appraisal presented in this complaint is dated 05/20/06. Anyone familiar with the timing of a BOREA investigation/complaint/plea bargain will immediately understand that James Esters is thumbing his nose at the system - i.e., laughing all the way to the bank.

Call to Action

I wrote a series of letters in late 2005 which called attention to mortgage fraud in the Denver metro area. Since that time, the problem has grown more pervasive and the dollar amounts have gotten bigger.

The sad reality is that mortgage fraud has become "generally accepted" in the Denver/Aurora real estate community. And no amount of lip service and tough talk is going to make any difference.

I am not politically active, and I don't want to be. Having said that, by copy of this letter, I urge the "authorities" to get past the lip service. Get serious, step up, work together and get something done. James L Esters needs to have his appraisal license permanently revoked. Sooner rather than later.

Jeannette L Esters (AR100008468) is now an apprentice appraiser working toward obtaining an appraiser's license. Any idiot can see she is being "trained" by James L Esters, (presumably) her husband. The fraud factory needs to be permanently closed.

To be clear, I am not suggesting the Jeannette Esters should be unreasonably denied a chance to obtain an appraisal license. I am suggesting that James Esters should not be allowed to sign off on her experience requirement. Jeannette Esters experience and education should be carefully reviewed (audited) to ensure compliance with the rules.

Erin Toll and John (Black Hole) Suthers -- in this case no subpoena is necessary - you have a complete copy of the appraisal report. At some point, the State of Colorado needs to demonstrate the resolve and the resources to revoke the licenses of those who played along.

If this appraisal report is not grounds for an immediate license revocation, then what is? How long is this going to take? If not now, then when?

Sincerely,

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

Attachments:

Appraisal Report
MLS - Residential Listing
MLS - 2 Family Listing
MLS Listing History

This letter is published on the Internet at:
http://www.mkgappraisal.com/letter2007_05.htm

-- End of Letter --

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