Golden Design Group

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).

-- [update 10/05/09: Peter Vincent Capra permnaently surrendered his Colorado mortgage broker license. See pg 13 of the DORA newsletter dated Fall 2009, and the final agency order dated May 2009]

-- [2nd update 07/13/10: Benjamin Serrano, Kristin A Clark, and Bradley Bishop took the hit at Golden Design Group. Read the press release of the United States Attorney's Office dated 11/13/09.]

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 --

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