Deer Ridge Owners - Deer Ridge Mountain Resort - Gatlinburg, Tennessee » fraud

Tennessee Consumer Affairs Complaint Filed Against Joe Thomas – Attorney General Action Requested

Robert — Mon, 30 Jan 2012 18:43:58 +0000

We are filing an official complaint with the Tennessee Consumer Affairs Division against Joe Thomas, principal broker of Ridge Resort Realty and general manager of both Ridge Management Ltd., Inc. and Gatlinburg Golf and Racquet Club aka Deer Ridge Mountain Resort in Gatlinburg, Tennessee. This complaint is primarily focused on what we believe are deceptive trade practices by Joe Thomas.

This Consumer Affairs complaint is in addition to the just completed complaint package that is being sent to the Tennessee Real Estate Commission requesting them to take disciplinary action against Joe Thomas for multiple violations of the Tennessee Real Estate Broker Act.

These alleged violations include deceptive trade practices, conduct that constitutes improper, fraudulent and dishonest dealings, willful misrepresentations, wrongly acting for more than one party in Deer Ridge transactions without the knowledge and consent in writing of all parties, etc. . We are specifically requesting that their disciplinary actions include fines and permanent revocation of Joe Thomas’ Tennessee real estate license.

The attachment to the Consumer Affairs complaint form is essentially the same as the one that was used for our formal complaint filed with TREC – with the exception of a couple of paragraphs of additional information that we choose to keep confidential at this time.

The only hold up to sending these two packages is that the TREC form requires notarization. This will be done and the completed packages mailed to both TREC and Consumer Affairs either Tuesday or Wednesday of this week.

Four Separate Actions Against Joe Thomas – So Far

Once these packages are mailed, we will have four separate actions in process against Joe Thomas:

Tennessee Securities Division for securities fraud and other securities law violations, etc. Please click Securities Fraud for details.
Tennessee Real Estate Commission (TREC) for multiple violations of the Tennessee Real Estate Broker Act, etc. Please click TREC for details.
Tennessee Consumer Affairs Division for deceptive trade practices, misrepresentations, etc.
Tennessee Attorney General for investigation and possible prosecution of actions related to the above three areas of focus, etc.

Pay attention, Joe: All of these great folks are from the government – and they are here to help you! Who knows? They might, just maybe, all show up at one time to help you all at once!

With regard to Item 1 above: Our complaint has been received by the Tennessee Securities Division, they have assigned an investigator and I have already spoken with the investigator to give additional information. As a consequence, this ticking time bomb is already getting closer to detonation!

Our hope is that each of these agencies will take appropriate actions to stop the ongoing pattern of deceptive trade practices, misrepresentations, securities fraud and discrimination that we believe are regularly perpetrated by Joe Thomas in his triple roles at Deer Ridge Mountain Resort that result in so much conflict of interest

Our hope is that both TREC and the Consumer Affairs Division will review our complaint and conclude that all of our allegations against Joe Thomas are not only fully accurate but that his past and future actions represent a true threat to the public. As such, we are requesting that he not only be sanctioned and substantially fined for his nefarious activities that have continued for more than a decade – but that his Tennessee real estate broker’s license will be permanently revoked so that he can no longer deceive those buying and selling Deer Ridge condos or other real estate in Tennessee.

File Your Own Consumer Affairs Complaint Against Joe Thomas

As described below, we believe we were intentionally deceived by Joe Thomas when we bought our condo at Deer Ridge. If you believe that Joe Thomas also deceived you when you bought your Deer Ridge condo, you are welcome to use the applicable part of our narrative in your own complaint. Simply take that information and complete your own complaint form against Joe Thomas. The Consumer Affairs complaint process and form are available by clicking “Book Em Danno”.

Note: It costs you nothing to file a complaint against Joe Thomas with Consumer Affairs. The great State of Tennessee will take care of it all for you, start to finish, without you having to spend a penny.

Allegations

Remember, as of now these are just my allegations of real estate and securities wrong doing by Luther Parker, Larry Ohm CPA, Joe Thomas, David Barone, Tom Reise and Margie Duncan. I believe that I am 100% correct on these allegations based on my years of experience in the business. We will have to wait and see if any, or all, of the 19 states and/or the SEC agree with me or if TREC and Consumer Affairs agree with me.

Next Filings

We also hope to have the time this week to file a comprehensive securities fraud complaint with the SEC in Washington, D.C

Other state filings, starting with Florida State Securities Division, will be done over the next one to two weeks.

Stay Tuned!

We live in interesting times. And, hopefully, with the help of the State of Tennessee Securities Division, Tennessee Real Estate Commission, Tennessee Consumer Affairs Division and the Tennessee Attorney General, we will make 2012 VERY interesting for the Gang of Six!

Tennessee Real Estate Commission Complaint Filed Against Broker Joe Thomas – License 281040

Robert — Sat, 28 Jan 2012 19:36:23 +0000

We are filing the following official complaint with the Tennessee Real Estate Commission (TREC) against Joe Thomas, principal broker of Ridge Resort Realty and general manager of both Ridge Management Ltd., Inc. and Gatlinburg Golf and Racquet Club aka Deer Ridge Mountain Resort in Gatlinburg, Tennessee.

All the paperwork, including the sworn affidavit and official complaint are done, the CD-ROM with 300 pages of supporting documents and evidence has been burned and the envelope for mailing is complete. The only hold up is that the TREC form requires notarization. This will be done and the entire package mailed to TREC either Monday or Tuesday of next week.

Securities Fraud Complaint Already Filed With Tennessee Securities Division

The TREC complaint is the next in a series of regulatory filings we intend to make against Joe Thomas and/or the GGRC and RML board for their roles in what we believe are ongoing securities fraud and other securities law violations, including multiple states and federal violations.

You can read all about my complaint filed with the Tennessee Securities Division by clicking Securities Fraud Complaint against President Luther Parker of Memphis, TN, Vice President Thomas Reise of Friendship, WI, Treasurer Larry Ohm, CPA of Grant Park, IL, Secretary David A. Barone of Monroe, NY and Director Margie Duncan of Florence, KY and Principal Broker and General Manager of RML and GGRC, Joseph Thomas of Kodak, TN.

(Update: The above complaint has been received by the Tennessee Securities Division, they have assigned an investigator and I have already spoken with the investigator to give additional information. As a consequence, this ticking time bomb is already getting closer to detonation!)

Meanwhile, Back At The Ranch…TREC Complaint And Requested Actions Against Joe Thomas

This particular TREC complaint is currently only focused on Joe Thomas and what we believe are his multiple, serious violations of the Tennessee Real Estate Broker License Act of 1973, as amended. These alleged violations include deceptive trade practices, conduct that constitutes improper, fraudulent and dishonest dealings, willful misrepresentations, wrongly acting for more than one party in Deer Ridge transactions without the knowledge and consent in writing of all parties, etc. (Even though this complaint is solely focused against Joe Thomas, TREC may choose to include actions against Ridge Resort Realty and/or RML and its board.)

Our hope is that TREC will review our complaint and conclude that all of our allegations against Joe Thomas are not only fully accurate but that his past and future actions represent a true threat to the public. As such, we are requesting that he not only be sanctioned and substantially fined for his nefarious activities that have continued for more than a decade – but that his Tennessee real estate broker’s license will be permanently revoked so that he can no longer deceive those buying and selling Deer Ridge condos or other real estate in Tennessee.

File Your Own TREC Complaint Against Joe Thomas

As described below, we believe we were intentionally deceived by Joe Thomas when we bought our condo at Deer Ridge. If you believe that Joe Thomas also deceived you when you bought your Deer Ridge condo, you are welcome to use the applicable part of the below narrative in your own complaint. Simply take that information and complete your own complaint form against Joe Thomas. The TREC complaint process and form are available by clicking “Book Em Danno”.

Note: It costs you nothing to file a complaint against Joe Thomas with TREC. The great State of Tennessee will take care of it all for you, start to finish, without you having to spend a penny.

Their $1 Million Lawsuit

If you recall, a lot of this started when the Gang of Six (Joe Thomas and the “board”) filed a $1 million lawsuit against me for “slander, libel and ‘false light’, etc.” as a way of trying to silence my first amendment rights and to try to shut down this blog. That was two years ago – and we are still here. However, based on recent actions by the Gang, they are still delusional that their $1 million nuisance suit gives them a hammer to force my capitulation.

One of the things that the Gang doesn’t seem to understand: You can legitimately say bad things about people if you believe they are true. And, we have already proven that Luther Parker, Larry Ohm and Joe Thomas, along with the rest of the board have perpetrated a $2 million fraud by falsely claiming that RML makes money for the HOA. (For details, click Luther Parker’s Big Lie.) We believe that this alone would easily convince a jury of our peers that we had the right to say what we have said and continue to say about Joe Thomas and the rest of the Gang. In spite of this, the Gang continues to squander our HOA dues on legal fees in their ongoing vendetta to protect their own little private fiefdom called Deer Ridge.

As a consequence, and with the goal of showing even more proof to a jury of my peers, I am very aggressively pursuing appropriate regulatory rulings that will show that Joe Thomas and the rest of Gang, have had very unclean hands as a result of their massive, ongoing securities fraud, other state and federal securities law violations, deceptive trade practices and violations of Tennessee consumer protection and real estate laws.

Even a single favorable ruling by any of the regulatory agencies agreeing with our official complaints would be that much more proof to the jury that the $1 million lawsuit by the Gang of Six was nothing more than a retaliatory way of trying to suppress our free speech. Having been born and raise in Tennessee, I can tell you with absolute certainty, Tennesseans take their right to free speech VERY seriously. And, they will have no tolerance for the Gang’s actions.

Allegations

Next Filings

During the upcoming week, our regulatory filing of official complaints will include the Tennessee Consumer Protection Division which will be essentially identical to this official complaint filed with TREC. We also hope to have the time this week to file a comprehensive securities fraud complaint with the SEC in Washington, D.C

Other state filings, starting with Florida State Securities Division, will be done over the next one to two weeks.

The Official TREC Complaint

The following is the content of a letter that was attached to the TREC Complaint Form. Also, included in the envelope is a CD-ROM with 300 pages of supporting documents and other evidence.

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Complaint: Deceptive Trade Practices, Securities Fraud And More Against Tennessee Real Estate Broker
Joseph Thomas – Tennessee License 281040

Summary

This complaint being brought before the Tennessee Real Estate Commission specifically deals with my multiple complaints regarding Tennessee real estate broker Joseph Thomas of Kodak, Tennessee for conduct that constitutes improper, fraudulent and dishonest dealings and other violations of the Tennessee Real Estate Broker License Act of 1973.

The home phone number and home address of Joe Thomas are: (865) 932-1669 / 3229 Autumn Lane, Kodak, TN 37764. The Tennessee Real Estate License number for Joe Thomas is 281040.

To fully understand the extent of Joe Thomas’ alleged willful misrepresentations, deceptive trade practices, securities fraud and more, it is necessary to fully define his conflicting roles with three related companies: Ridge Management, Inc., Gatlinburg Golf and Racquet Club and Ridge Resort Reality.

Ridge Management Ltd, Inc. (“RML”) is a “for profit” Tennessee domestic corporation, with corporate offices at 3710 Weber Road, Gatlinburg, Tennessee 37738, and was originally incorporated December 29 1987. A copy of the current filing information (Control #198618), incorporation documents, stock certificate and articles of incorporation are included as Exhibit A. (All supporting documents are in Acrobat format and are contained in the included CD-ROM.)

RML is owned by the 84 owners who own individual condominiums at Deer Ridge Mountain Resort, Gatlinburg, Tennessee, which is governed by the Gatlinburg Golf and Racquet Club Condominium Association, Inc. (“GGRC”) in accordance with the Tennessee Horizontal Property Act. GGRC is a “non-profit” Tennessee domestic corporation with corporate offices at 3710 Weber Road, Gatlinburg, Tennessee 37738, and was originally incorporated March 13, 1984. A copy of the current filing information (Control # 139212) is also included in Exhibit A.

Joseph Thomas of Kodak, Tennessee serves as the General Manager of both GGRC and RML.

He also serves as Principal Broker of Ridge Resort Realty (“RRR”) (www.RidgeResortRealty.com ) which is a DBA of RML. As a consequence, Joe Thomas serves three major roles in companies all related to RRR, thereby creating a substantive conflict of interest that is not clearly disclosed to buyers of condos at Deer Ridge.

Many, if not most, owners of the 84 total outstanding shares of RML are believed to be unaccredited and unsophisticated investors. The prices for condos at Deer Ridge generally range from $35,000 to $90,000.

It is important to note that RML, under the direction of Joe Thomas, is not solely focused on providing motel services to Deer Ridge owners – but is, instead, a motel service that aggressively pursues cabins and other rental properties which are completely unaffiliated with Deer Ridge. However, in spite of RML expending up to $100,000 or more per year on advertising and marketing, this high risk small company has not been successful in competing in the motel business marketplace and has only signed up about a half dozen additional rental properties. As a consequence, based on corporate audits, RML has lost over $2 million during the past 16.5 years. As the following will show, this $2 million loss was funded by mandatory, illegitimate capital calls that were required to be paid by the real estate owners of all 84 units at Deer Ridge.

By way of background, for the past six plus years, I have been an owner of one of the 84 condo units at Deer Ridge governed by GGRC. As such, I am one of the 84 de facto shareholders of RML.

As an MBA, and the founder and past owner of Goodman Securities, Inc., a NASD Broker/Dealer company which was also a member of SIPC, I believe that I have the necessary credentials and background to recognize that RML, real estate broker Joe Thomas and the board of directors of RML have committed, and continue to commit, what I believe are major state and federal securities law violations including securities fraud exceeding $2 million.

As founder and CEO of a real estate investment company for 15 years that purchased, as a principal, over $100 million of income properties and managed over 45,000 rental units, I believe that I have the necessary credentials and background to recognize that Joe Thomas has committed, and continues to commit, willful misrepresentations, exhibit conduct that constitutes improper, fraudulent and dishonest dealings and deceptive and fraudulent trade practices with regard to many millions of dollars or real estate transactions in Tennessee.

It is my contention that these willful misrepresentations, securities law violations and deceptive trade practices, which have been going on for more than a decade by Joe Thomas, have already resulted in many past and current condo owners being forced into personal bankruptcy and/or losing their Deer Ridge condo in foreclosure or have forced past owners to sell their unit at a significant loss.

As such, I respectfully request that the Tennessee Real Estate Commission thoroughly investigate these complaints for the protection of the past, current and future real estate purchasers of Deer Ridge condos and any and all other persons involved with Tennessee real estate transactions involving Joe Thomas.

Specific Complaints Against Joe Thomas

My complaints include the following allegations:

1. Joe Thomas, General Manager of both GGRC and RML, and the board continue to perpetrate a fraud on all owners by fraudulently claiming, as recently as 60 days ago, that RML has continually made money for the owners. Please see Exhibit B, Luther Parker Letter, dated November 15, 2011 and mailed to all Deer Ridge owners on or about December 1, 2011.

2. In spite of these fraudulent statements and willful misrepresentations, CPA audits commissioned by the corporation clearly show that RML has lost nearly $2 million of owner’s money during the past 16.5 years. This loss of $1,915,934 is calculated based on CPA audits completed by Hickman and Company, CPAs under the direction of Luther Parker, President, Larry Ohm, CPA and Treasurer – and Joe Thomas, General Manager. Please see Exhibit C for copies of all audits and a comprehensive analysis of the audited numbers.

3. This RML loss of $1,915,934 over the past 16.5 years equates to an average RML loss of $116,117 every year.

4. This annual average RML loss of $116,117 has been funded directly out of the pockets of all 84 Deer Ridge owners under the guise of increased, mandatory monthly HOA fees charged to all condo owners at Deer Ridge who happen to also be the stock holders of RML. Instead of the required capital for the operating deficit being funded by an optional capital call to all stockholders, the needed funds are fraudulently included in the monthly HOA fees that are required of all owners. These hidden equity payments continue to equal more than 40% of the contrived monthly HOA fee. Please see Exhibit D for a list of all current owners.

5. This annual average RML loss of $116,117 equals 40% of the $290,540 annual HOA fees collected from all owners of the 84 units at Deer Ridge. As a consequence, nearly half of all HOA fees paid in by the mostly unaccredited and unsophisticated owners are being squandered by this illegitimate corporation’s need for monthly capital infusions.

6. I contend that the actual RML losses are, in fact, much higher than the annual average RML loss of $116,117 shown on the audits. This is because the audits indicate various expense items that should rightfully be associated with and cost accounted with the motel operation of RML are, instead, spurious costs that are listed as expenses of GGRC. I believe that this is being done in order to intentionally deceive owners as to the actual losses that accrue each year from RML’s unprofitable motel operation.

7. RML was illegitimately formed by the board of directors of GGRC in 1987 without a vote of owners – and without providing owners any kind of disclosure or offering document that detailed the risks, management compensation, etc. of the unregistered security. In spite of it not being an approved Common Expense of GGRC, funding for this new corporation, RML, was pulled from the general operating account of GGRC, a non-profit corporation, which in turn was, and is, fully funded by the 84 owners of the condos at Deer Ridge Mountain Resort. As such, RML has offered and continues to offer, unregistered securities to Tennessee residents along with residents of at least 18 other states. Please see Exhibit D.

8. Under the Securities Act of 1933, it is against the law for any company, or “issuer,” to sell securities without either registering the securities with the Securities and Exchange Commission pursuant to Section 5 of the Securities Act or relying upon a valid exemption from the registration requirements. Similarly, pursuant to each individual state’s “Blue Sky” laws, it is generally against the law to sell securities within a state without either registering the securities with the state’s securities regulatory agency or relying upon a valid state exemption from registration.

9. At no time has RML or GGRC ever issued any kind of Reg D private placement memorandum or any other offering document or any type of disclosure documents to the stockholders of RML. There has never been any discussion of risk factors, management compensation or limitations of transfer of ownership that could have tax consequences to both the stockholders and the corporation. Additionally, no investors were ever asked to complete any prospective purchaser questionnaires that asserted that they were accredited. Additionally, no Form D was filed with either the state of Tennessee or with the SEC in Washington, D.C. nor was there any filing fee paid in Tennessee for RML or GGRC to qualify for any securities exemptions. As a consequence, any securities offering made by RML or GGRC does not qualify for any exemptions contemplated by Tenn. Code. Ann. §48-2-103.

10. TENN. CODE ANN. § 48-2-102 provides that a security is defined to include investment contracts. An investment contract is an agreement wherein initial value is given and subjected to the risks of an enterprise, with a valuable benefit of some kind, over and above the initial value, being promised, but the investor does not receive meaningful rights to exercise practical or actual control over the managerial decisions of the enterprise. I believe that this definition of an investment contract includes an investment in a vacation home.

11. Please note from Joe Thomas’ current Real Estate Sales Package that is available to the general public, shown as Exhibit E, that he sells condos at Deer Ridge Mountain Resort as a “personal or corporate investment.” Joe Thomas is also currently advertising these investments in Deer Ridge condos in the mainstream media, thereby, in my opinion, publicly offering unregistered securities to Tennessee residents and engaging in securities fraud every time that he attempts to broker a real estate transaction at Deer Ridge.

12. In examining Exhibit E, “Joe Thomas Deer Ridge Sales Package, December 2011,” note the following reference: “GG&RC HOA Fees cover maintenance and upkeep of all commonly owned areas including but not limited to exterior lighting, parking lot, landscaping, playground, tennis court, picnic pavilion, recreation building including indoor pool, Jacuzzi, sauna, steam room, game room, offices, golf membership and multi-peril insurance on the same.”

In spite of Joe Thomas’ insider knowledge and review of the annual audits, nowhere in his “disclosure” is any reference to the fact that 40% or more of the HOA fees listed are used to fund the average annual operating deficit of $116,117 of RML based on the corporation’s audits.

As a consequence, potential buyers are never told of major, unexpected, undisclosed risk factors prior to their purchase of a of a Deer Ridge condo: Their required ownership of stock in RML and their required ongoing, monthly capital infusions into a money losing venture called RML – and that their non-payment of these capital infusions into this money losing venture would result in foreclosure of their Deer Ridge real estate and contingent personal liability for any potential deficiency.

13. Buyers and owners of condos at Deer Ridge are given no choice of owning shares of RML. All owners must own a share of RML and are required to fund RML’s large operating deficits under the guise of required HOA fees that are nearly twice what would be required if RML were not funded by HOA fees. If owners object to this ongoing monthly capital call and do not pay, those owners are threatened with foreclosure of their home at Deer Ridge. This includes the 24 owners who do not use RML’s services – many of whom object to this illegitimately required monthly capital call funding into RML.

14. For example, when I bought my unit, Joe Thomas acted as both listing and selling broker on the transaction. At no time did Joe Thomas disclose any requirement for us to own a participating share of RML nor did he disclose that nearly half of the property’s annual HOA fees would be used to support a motel management company’s negative cash flow – even if we were not users of RML’s motel services. It is our understanding from recent property sales that Joe Thomas continues his historical lack of disclosure, his willful misrepresentations and his deceptive trade practices.

15. Additionally, Joe Thomas and the board of RML and GGRC have conspired to modify the required monthly HOA fees so that they do not match those percentages shown in the Master Deed and Bylaws. For example, the currently charged HOA fee for a one bedroom, one bath condo at Deer Ridge is, in fact, 82% higher each and every month than the percentages that would be paid according to the regime documents provided by Joe Thomas to us and other new buyers of 1-1 units.

In spite of his insider knowledge of this massive 82% discrepancy, Joe Thomas does not disclose this gross overcharge to new buyers of 1-1 units. (36% of all units at Deer Ridge are 1-1 units.) Most buyers would have a reasonable expectation that the property’s Master Deed and Bylaws would be followed by the HOA’s board. As general manager of GGRC, the property’s HOA, Joe Thomas clearly understands this discrepancy – especially in light of Joe Thomas, GGRC and each individual board member being named as co-defendants in a lawsuit in which this 82% overcharge is a key issue. In spite of Joe Thomas’ crystal clear knowledge of this 82% overcharge, the fact is still not properly disclosed on Deer Ridge sales in which he is a participating broker. Likewise, Joe Thomas does not disclose the existence of this current, potentially significant, litigation against the HOA to any new buyers of any sized units at Deer Ridge.

16. The fact that Joe Thomas also served then, and continues to serve, as General Manager of both GGRC and RML, as well as the principal broker of Ridge Resort Realty (a DBA of RML), gave and gives him complete knowledge and insights into the true operation of both corporations. As such, I contend that Joe Thomas knowingly and deviously omits these disclosures as part of his deceptive trade practices as a Tennessee real estate agent since many buyers, ourselves included, would have never bought a Deer Ridge condo if proper disclosure of these risk factors and gross overcharges had been properly made.

17. It is my contention that most buyers of small condos under $90,000 do not expect that they will also be unwilling stockholders in a money-losing motel business that will squander almost half of each year’s HOA fees. As such, the lack of this disclosure by broker and General Manager Joe Thomas is especially nefarious and fraudulent.

18. It is my contention that Joe Thomas , as General Manager and Principal Broker, is aided and abetted by all five members of the board of directors of RML, all of whom are co-conspirators in securities fraud and other securities law violations and have breached their fiduciary duties to all owners. The board members are President Luther Parker of Memphis, TN, Vice President Thomas Reise of Friendship, WI, Treasurer Larry Ohm, CPA of Grant Park, IL, Secretary David A. Barone of Monroe, NY and Director Margie Duncan of Florence, KY. General Manager of RML is Joseph Thomas of Kodak, TN. Please see Exhibit F for a complete listing including each individual’s home address, home telephone number and personal email address.

19. It is my contention that all five board members and Joe Thomas have conspired for years to fraudulently deceive owners at Deer Ridge regarding the profits and losses of RML in order for them to continue to operate their motel business for their own personal gain and benefits – none of which are disclosed to owners. These six individuals are concerned about the growing complaints of owners regarding having the highest HOA fees in the entire East Tennessee area. These six individuals are concerned that if the owners knew the truth about more than 40% of the HOA fees were used to cover the exorbitant annual losses of RML, these owners would take action to shut down this illegitimate corporation and cut their HOA fees in half. These six individuals are concerned that with an RML shut down, the benefits they uniquely receive from their motel business would be lost. I contend that this is the primary reason that Luther Parker, Larry Ohm, CPA and Joe Thomas lead this conspiracy to fraudulently lie to all owners about the profitability of RML.

20. TENN. CODE ANN. § 48-2-121 provides that it is unlawful for any person, in connection with the offer, sale or purchase of any security in this state, directly or indirectly, to make any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements made, in light of the circumstances under which they are made, not misleading. In spite of the corporations’ audits showing a $2 million loss during the past 16.5 years, Luther Parker, Larry Ohm and Joe Thomas continue to falsely assert that RML is a profitable operation in order to intentionally mislead owners.

21. As a result of his inherent conflicts of interest from being the General Manager of RML from which he receives his primary compensation, Joe Thomas, as principal broker for RRR, has consistently discriminated against potential buyers of condos at Deer Ridge who he believed would be a resident owner or who would otherwise not use RML for rental activities. As such, I contend that Joe Thomas was, and is, wrongly acting for more than one party in Deer Ridge transaction without the knowledge and consent in writing of all parties. As such, sellers were not able to have all possible prospective buyers bid on their property. As such, many buyers who were interested in becoming a full time resident were directly, or through subterfuge, strongly discouraged from buying a condo at Deer Ridge. I contend that these malicious acts were, and are, motivated by Joe Thomas’ expectations of increased personal gain at the expense of owners wishing to sell their units.

22. Additionally, those owners who choose to not use RML’s motel services, such as the 24 current owners, continue to be subjected, under the direction of Joe Thomas, to significant discrimination, retaliatory actions and malicious slander and libel as well as being burdened with financial costs not borne by RML participants.

23. Many of these same board members and Joe Thomas have been in complete control of the board and the operation of Deer Ridge for a decade or more.

24. The company’s treasurer is Larry Ohm who claims to be a CPA in Illinois. I contend that because of his profession-required understanding of financial statements, Larry Ohm fully understands the audits and the nearly $2 million aggregate loss they show for the past 16.5 years. Yet, he continually and fraudulently misrepresents that RML is making the stockholders money. Please see Exhibit G which clearly shows Larry Ohm falsely stating that, “This clearly contradicts the accusations by anyone that HOA fees and special assessments are being utilized to pay for the costs of operating RML. In truth, in the past, it was RML that was providing a subsidy to GGRC.”

This fraudulent and misleading statement by Larry Ohm, CPA, was made to all owners in spite of 16 years of audits of the corporation clearly showing a $2 million loss, or an average loss of $116,117 every year for 16 years!

25. Exhibit H includes my Warranty Deed, complete closing statement package and my fully executed purchase contract with all attachments showing Joe Thomas as the only broker involved.

These documents show that there was never any disclosure of any kind made to me prior to closing that indicate in any way that I would be fraudulently forced to support a money losing corporation such as RML as part of my purchase or a residential condo. Again, if this had been properly and legitimately disclosed, I would have never considered closing on this transaction.

26. During the past six plus years that I have owned a condo at Deer Ridge, I have documentation that repeatedly pointed out to Joe Thomas and these board members that they are lying to the owners about RML’s profitability in light of the attached annual audits that they themselves commission each year. Therefore, there can be no legitimate claim by any board member or General Manager Joe Thomas that they had no knowledge of the facts.

27. In spite of numerous attempts, during the past six plus years that I have owned a condo at Deer Ridge, I have never received a copy of the Administrator’s Book that lists all income and disbursements, along with supporting vouchers. This Administrator’s Book, in this specific format, is required by the Tennessee Horizontal Property Act (§66-27 -113.) It is my understanding that Joe Thomas and the board have never made this Administrator’s Book available to any owner. Ever. As a consequence, no owner or stockholder in RML has ever been allowed to see the books and records as required by Tennessee state law. It is my contention that this stonewalling is driven by the conspiring board’s strong desire to hide certain transactions from the scrutiny of the stockholders – and it is my belief that these hidden transactions hide multiple acts of malfeasance.

Again, based on my 15 plus years of experience from acquiring $100 million of income property and managing 45,000 rental units – and my many years of experience from owning a NASD broker-dealer and my involvement with numerous private placement offerings and the applicable state and federal securities laws that control such offerings, I strongly believe there may be major, ongoing malfeasance that is negatively impacting the owners of condos at Deer Ridge.

The owners at Deer Ridge are mostly unaccredited investors who, in my opinion, are being consistently and deliberately deceived and victimized by a conspiracy of Joe Thomas and the board of directors of both RML and GGRC who are personally benefiting from these deceptions. I believe that these ongoing activities, deceptive trade practices and material misrepresentations are violations of the Tennessee Securities Act of 1980, as amended, and violations of the Tennessee Real Estate Broker License Act of 1973, as amended, and put the public at significant risk of immediate and irreparable injury, loss or damage.

Based on the above allegations and the enclosed exhibits, I believe that your investigation will find that Joe Thomas, Luther Parker, Larry Ohm CPA and the rest of the board continue to perpetrate willful misrepresentations, conduct that constitutes improper, fraudulent or dishonest dealings and numerous and substantial securities law violations to the financial determent of past, current and future owners of condos at Deer Ridge.

I have already filed a complaint for securities fraud with the Securities Division of the Department of Commerce and Insurance for the State of Tennessee asking that they investigate this complaint for the protection of the current and future owners of stock in RML. They have already assigned an investigator who has initiated a comprehensive review of the facts from a securities perspective.

Additionally, I have hired an attorney and we have filed several court actions against Joe Thomas as a result of his willful misrepresentations, deceptive trade practices, violations of securities laws and other nefarious acts.

I am not looking to the Tennessee Real Estate Commission for any recovery of funds to which I may be entitled. I shall look to the courts for that relief.

However, it is my strong belief that the public needs to be protected from Joe Thomas – and that he should not only be sanctioned and substantially fined by the Tennessee Real Estate Commission – but should have his Tennessee real estate license permanently revoked to prevent him from continuing to victimize, mislead and deceive any more real estate buyers and sellers in our great State.

I will be glad to be of help to your investigation and will gladly testify at any hearings concerning this matter.

Not only can I provide your department with numerous additional documents and evidence not contained on the enclosed CD-ROM, I will gladly meet with you at your convenience or discuss these allegations on the phone in order to expedite your review of the facts concerning the multitude real estate violations of Joe Thomas.

Thank you for your consideration of my complaint.

Sincerely,

Robert Goodman

PS: Much of this legal fight is fully documented at my blog www.DeerRidgeOwners.com. This blog has between 35,000 and 50,000 page views per month – with interested viewers all over the country watching to see what justice can be found in the great State of Tennessee.

I hope that the actions of the Tennessee Real Estate Commission will show the nation that we Tennesseans will not tolerate real estate fraud, deceptive trade practices, securities fraud and other securities law violations – and that even unaccredited and unsophisticated real estate buyers will be protected.

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Stay Tuned!

We live in interesting times. And, hopefully, with the help of the State of Tennessee Securities Division and the Tennessee Real Estate Commission, we will make 2012 VERY interesting for the Gang of Six!

Investigator Assigned In Deer Ridge Securities Fraud Complaint

Robert — Sat, 14 Jan 2012 15:43:58 +0000

FLASH NEWS!

As you have read here, I have filed a securities fraud complaint against RML, Luther Parker, Larry Ohm CPA, Joe Thomas and all “board members” of Ridge Management Ltd, Inc.

This first complaint for securities law violations was filed with the State of Tennessee Department of Commerce and Insurance Securities Division in Nashville.

I received a letter from them yesterday stating that an investigator has been assigned to the case.

Obviously, this is only the first step in their determining if there is probable cause to believe there has been a violation, or violations, of the Tennessee Securities Act of 1980 in order for them to refer evidence of violations for criminal or administrative action.

You can read all about my securities fraud complaint against RML, Luther Parker, Larry Ohm CPA, Joe Thomas and all “board members” of Ridge Management Ltd, Inc. by clicking “Book ‘em Danno!”

There, you can also see how you can file your own securities fraud complaint against the Gang of Six!

Stay Tuned!

We live in interesting times….and things, I hope, may get VERY interesting VERY soon!

Securities Fraud Complaint Filed Against RML, Luther Parker, CPA Larry Ohm, Joe Thomas And All Board Members

Robert — Wed, 21 Dec 2011 17:35:04 +0000

The first of several securities fraud complaints was filed today against RML, Luther Parker, Larry Ohm CPA, Joe Thomas and all “board members” of Ridge Management Ltd, Inc.

This first complaint for securities law violations was filed with the State of Tennessee Department of Commerce and Insurance Securities Division in Nashville. Below you can see the completed form. Attached to the form was the following information along with an included CD-ROM that provides copies of nearly 300 pages of applicable documents and evidence.

Since the current ownership of all 84 units at Deer Ridge Mountain Resort include domiciles in 19 states, I intend to file similar complaints for securities fraud, and other securities law violations, with each of those additional 18 individual states securities divisions. Additionally, since four of the five board members live outside of Tennessee and since ownership is spread across 19 states, I intend to file a similar complaint for securities fraud and other securities law violations with the Securities Exchange Commission (SEC) in Washington D.C. since the geographically diverse ownership makes it a federal case. (Note: If an owner’s home address is in any particular state, then almost always, that state’s unique and specific securities laws must also be followed to the letter – as well as the securities laws of the state of Tennessee.)

As I have previously mentioned here, Luther Parker, Larry Ohm and Joe Thomas all have continued to falsely represent that RML makes money and does not cost our GGRC HOA and the Deer Ridge owners money. In spite of me showing my proof that RML has lost us $2 million during the past 16.5 years BASED ON THEIR AUDITS, the Gang of Six refuses to admit their lies.

I have asked Luther Parker for his proof of his statements in his November 15, 2011 letter that was sent to all owners, “RML does not cost the HOA. In the past it funded GGRC approximately $45,000 per year. The cost to operate GGRC remains the same with or without RML. HOA fees would not be cut in half.”

Folks, these statements by Luther Parker are lies.

And I am tired of Luther Parker, Larry Ohm CPA, Joe Thomas, David Barone, Tom Reise and Margie Duncan intentionally misleading all owners regarding this hugely important and pivotal matter. Luther has not come forward with any proof. So, I intend to force him to prove his statements were true to state authorities – in lots of states.

Based on my experience gained from starting and owning my own National Association of Securities Dealers (NASD) broker-dealer corporation and being a member of the Securities Investor Protection Corporation (SPIC), and having raised $25 million from investors and venture capital, I know something about state and federal securities laws. And it is my opinion, based on all of that experience, that these kinds of lies told repeatedly by Luther Parker, Larry Ohm CPA, Joe Thomas, David Barone, Tom Reise and Margie Duncan should be considered securities fraud.

Additionally, since buying any condo at Deer Ridge requires that any owner become a de facto stockholder of RML, at least 40% of all owners’ HOA fees will be squandered by feeding RML’s massive negative cash flow. Since every new owner, along with all existing owners, are forced to fund this ongoing need for capital contributions into the illegitimate RML, I believe that additional, ongoing major securities fraud is committed by Joe Thomas every time he sells a condo.

This is because Joe Thomas NEVER tells buyers they will be forced to own part of RML and fund these huge negative cash flows. I believe that this despicable and intentional lack of disclosure by Joe Thomas probably violates multiple other state and federal securities laws as well as being violations of the rules and regulations of the Tennessee Real Estate Commission.

RML Is A Corporation That Issued Shares And Is Required To Abide By Securities Law

Whether the Gang of Six likes it or not, Ridge Management Ltd, Inc. is a corporation that is governed by securities laws in Tennessee and elsewhere. As such, these securities laws regulate what can be done, how it can be done and what can be said or not said with regard to RML.

One of the things officers and directors cannot do is lie and mislead investors in the corporation.

If I am showing, based on the corporation’s own audits, that RML lost $2 million during the past 16.5 years, you can easily verify my statement and my math by reviewing the same audits. The same is true for the Securities Division of Tennessee, and all other securities agencies and the SEC.

Luther Parker made his above statements about a month ago. I’ve asked him to prove it. He has chosen once again to ignore owners’ demands of proof – and has not provided an iota of proof of his statement. Again, this is Luther Parker’s most recent published lie, “RML does not cost the HOA. In the past it funded GGRC approximately $45,000 per year. The cost to operate GGRC remains the same with or without RML. HOA fees would not be cut in half.”

Uh huh.

Now, he can try to prove every nuance of those statements to the Securities Division of Tennessee. And, they won’t take his empty, arm waving and name calling as proof of anything! Plus, they have their own forensic accountants and forensic computer experts who know how to find malfeasance and ferret out the REAL truth.

Better get ready, boys, they are from the government – and they are here to help you!

Securities Division of Tennessee – An Agency With Big Teeth

Just so you know, the Securities Division of Tennessee is not some toothless state agency without power to force compliance. Actually, it is just the opposite. It can fine both the corporation and/or the individuals associated with the corporation for all sorts of securities law violations.

A review of recent actions taken by the Securities Division of Tennessee shows that they have forced consent decrees, taken away licenses, shut down companies and have fined individuals involved with various securities law violations, including securities fraud, with personal fines exceeding $500,000 for EACH person involved and for EACH violation. These are for civil violations. If they uncover criminal violations, those charges and actions are dealt with separately and IN ADDITION to the punishments and fines for civil violations.

I would call that some major teeth, n’cest pas?

Just The Start

Virtually every state has a securities division or agency similar to the Securities Division of Tennessee. And each one has similar kinds of teeth for similar kinds of securities fraud.

Of course, if you think that’s bad – well, then we also have the Securities Exchange Commission to help us out since Deer Ridge and RML fall under federal scrutiny too. The SEC has monster teeth.

These are the same folks that sent Martha Stewart and Bearnie Madoff to prison after charging them with securities fraud and other securities law violations. The SEC has already charged 87 CEOs, CFOs and other senior officers and their banks and mortgage companies in the 2008 Financial Crisis with securities violations and have already fined these officers and directors with nearly $2 billion in penalties, disgorgement and other monetary relief.

The Word of Today For The Gang of Six: Disgorgement

Disgorgement is repayment of ill-gotten gains that is imposed on wrong-doers by the courts. Funds that were received through illegal or unethical business transactions such as securities law violations are disgorged, or paid back, with interest to those affected by the action.

Individuals or companies that violate Securities and Exchange Commission (SEC) regulations are typically required to pay both civil money penalties and disgorgement. Civil money penalties are punitive, while disgorgement is about paying back profits made from those actions that violated the SEC’s regulations. However, disgorgement payments are not only demanded of those who violate securities regulations. Anyone profiting from illegal or unethical activities may be civilly required to disgorge their profits.

My expectation is that the SEC and the various state securities agencies will take this same approach of disgorgement with regard to the $2 million Luther Parker lie, and all the OTHER lies and misrepresentations, and force this kind of repayment to ALL past and current owners at Deer Ridge. (Yes, folks, even those of you who have already sold your unit or lost it in foreclosure or forced to sell at a loss may be covered by the complaint process – so be sure and file your own complaint! See below.)

Based on everything I know about securities law – and the MANY ways that things are wrongly done at Deer Ridge and the way lies have been told for years along with all the massive, misleading misrepresentations – I think the SEC might find it interesting to research ALL the ways that this fiefdom has been run for so many years – and the millions of dollars it has cost past and current owners.

Allegations

Remember, as of now these are just my allegations of securities wrong doing by Luther Parker, Larry Ohm CPA, Joe Thomas, David Barone, Tom Reise and Margie Duncan. I believe that I am 100% correct on these allegations based on my years of experience in the business. We will have to wait and see if any, or all, of the 19 states and/or the SEC agree with me.

Below the line is what I filed with the official complaint form for the Securities Division of Tennessee. If you would like to file your own securities law violations complaint against RML and/or the individual members of the Gang of Six with the Tennessee Securities Division, just click “Book ‘em Danno!”

Note: It costs you nothing to file a securities law complaint against RML and the Gang of Six. The great State of Tennessee will take care of it all for you, start to finish, without you having to spend a penny. The same is true for the SEC – and probably every one of the other 18 states where Deer Ridge owners live.

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Investor Complaint For Securities Fraud And Other Securities Law Violations Filed Against Ridge Management LTD, Inc.
and
President Luther Parker, Treasurer Larry Ohm CPA, General Manager Joe Thomas, Vice President Tom Reise, Secretary David Barone and Director Margie Duncan

Summary

Luther Parker, of Memphis, Tennessee, serves as the President of both GGRC and RML.

RML is a rental company that provides motel services for certain Deer Ridge owners, and other real estate owners who do not own a Deer Ridge unit, who wish to rent their individual condo or cabin. Only about 60 of the 84 units at Deer Ridge currently use the motel services of RML. The other 24 owners do not rent their condo or use another rental management company. It is important to note that RML is not solely focused on providing motel services to Deer Ridge owners – but is, instead, a motel service that aggressively pursues cabins and other rental properties which are completely unaffiliated with Deer Ridge. However, in spite of RML expending up to $100,000 and more each year in advertising and marketing, this high risk small company has not been successful in competing in the motel business marketplace and has only signed up about a half dozen additional rental properties.

As a consequence, based on corporate audits, RML has lost $2 million during the past 16.5 years. As the following will show, this $2 million loss was funded by illegitimate capital calls.

By way of background, for the past six plus years, I have been an owner of one of the 84 condo units governed by GGRC. As such, I am one of the 84 de facto shareholders of RML.

As an MBA, and the founder and past owner of a NASD Broker/Dealer company which was also a member of SIPC, I believe that I have the necessary credentials and background to recognize that RML has committed, and continues to commit, what I believe are major state and federal securities law violations including securities fraud exceeding $2 million.

I believe that many of these violations may include current criminal conduct as well as blatant civil violations including ongoing securities fraud happening on a monthly basis.

It is my contention that these securities law violations, which have been going on for more than two decades, have already resulted in many past and current stockholders being forced into personal bankruptcy and/or losing their Deer Ridge condo in foreclosure or have been forced to sell their unit at a significant loss.

Currently, the owners of the 84 units at Deer Ridge are comprised of approximately 14 owners who live in Tennessee and 70 who have domicile addresses in 18 other states.

As such, since securities laws for other jurisdictions are clearly involved, we intend on contacting the state agency for securities laws in each of those 18 other states as well as the Securities Exchange Commission in Washington D.C. for issues regarding federal law. We intend on sending those agencies this same information in this letter along with a copy of the enclosed CD-ROM that contains the supporting documents and evidence.

However, since I am a born and raised Tennessee resident, and since the corporations involved are domestic and under your jurisdiction, I wanted to first contact your department regarding these securities violations so that you could have a head start on enforcement and compliance.

As such, I respectfully request that the Securities Division of the Department of Commerce and Insurance for the State of Tennessee thoroughly investigate this complaint for the protection of the past, current and future owners of common stock in RML.

Investor Complaints

My investor complaint includes the following allegations:

Luther Parker, President of both GGRC and RML, continues to perpetrate a fraud on all stockholders by fraudulently claiming, as recently as 30 days ago, that RML has continually made money for the owners. Please see Exhibit B, Luther Parker Letter, dated November 15, 2011 and mailed to all Deer Ridge owners on or about December 1, 2011.
In spite of the fraudulent claims by Luther Parker, CPA audits commissioned by the corporation clearly show that RML has lost nearly $2 million of investors’ money during the past 16.5 years. This loss of $1,915,934 is calculated based on CPA audits completed by Hickman and Company, CPAs under the direction of Luther Parker, President, Larry Ohm, CPA and Treasurer and Joe Thomas, General Manager. Please see Exhibit C for copies of all audits and a comprehensive analysis of the audited numbers.
This RML loss of $1,915,934 over the past 16.5 years equates to an average RML loss of $116,117 every year.
This annual average RML loss of $116,117 is funded directly out of the pockets of all 84 Deer Ridge owners under the guise of increased monthly HOA fees to all condo owners at Deer Ridge who happen to also be the stock holders of RML. Instead of the required capital for the operating deficit being funded by an optional capital call to all stockholders, the needed funds are fraudulently included in the monthly HOA fees that are required of all owners. These hidden equity payments continue to equal more than 40% of the contrived monthly HOA fee. Please see Exhibit D for a list of all current stockholders.
This annual average RML loss of $116,117 equals 40% of the $290,540 annual HOA fees collected from all owners of the 84 units at Deer Ridge. As a consequence, nearly half of all HOA fees paid in by the mostly unaccredited and unsophisticated investors are being squandered by this illegitimate corporation’s need for monthly capital infusions.
I contend that the actual RML losses are, in fact, much higher than the annual average RML loss of $116,117 shown on the audits. This is because the audits indicate various expense items that should rightfully be associated with and cost accounted with the motel operation of RML are, instead, spurious costs that are listed as expenses of GGRC. I believe that this is being done in order to intentionally deceive stockholders as to the actual losses that accrue each year from RML’s unprofitable motel operation.
RML was illegitimately formed by the board of directors of GGRC in 1987 without a vote of owners – and without providing owners any kind of disclosure or offering document that detailed the risks, management compensation, etc. of the unregistered security. In spite of it not being an approved Common Expense of GGRC, funding for this new corporation, RML, was pulled from the general operating account of GGRC, a non-profit corporation, which in turn was, and is, fully funded by the 84 owners of the condos at Deer Ridge Mountain Resort. As such, RML has offered and continues to offer, unregistered securities to Tennessee residents along with residents of at least 18 other states. Please see Exhibit D.
Under the Securities Act of 1933, it is against the law for any company, or “issuer,” to sell securities without either registering the securities with the Securities and Exchange Commission pursuant to Section 5 of the Securities Act or relying upon a valid exemption from the registration requirements. Similarly, pursuant to each individual state’s “Blue Sky” laws, it is generally against the law to sell securities within a state without either registering the securities with the state’s securities regulatory agency or relying upon a valid state exemption from registration.
At no time has RML or GGRC ever issued any kind of Reg D private placement memorandum or any other offering document or any type of disclosure documents to the stockholders of RML. There has never been any discussion of risk factors, management compensation or limitations of transfer of ownership that could have tax consequences to both the stockholders and the corporation. Additionally, no investors were ever asked to complete any prospective purchaser questionnaires that asserted that they were accredited. Additionally, no Form D was filed with either the state of Tennessee or with the SEC in Washington, D.C. nor was there any filing fee paid in Tennessee for RML or GGRC to qualify for any securities exemptions. As a consequence, any securities offering made by RML or GGRC does not qualify for any exemptions contemplated by Tenn. Code. Ann. §48-2-103.
TENN. CODE ANN. § 48-2-102 provides that a security is defined to include investment contracts. An investment contract is an agreement wherein initial value is given and subjected to the risks of an enterprise, with a valuable benefit of some kind, over and above the initial value, being promised, but the investor does not receive meaningful rights to exercise practical or actual control over the managerial decisions of the enterprise. I believe that this definition of an investment contract includes an investment in a vacation home. Please note from Joe Thomas’ current Real Estate Sales Package that is available to the general public, shown as Exhibit E, that he sells condos at Deer Ridge Mountain Resort as a “personal or corporate investment.” Joe Thomas is also currently advertising these investments in the mainstream media, thereby, in my opinion, publicly offering unregistered securities to Tennessee residents and engaging in securities fraud.
In examining Exhibit E, “Joe Thomas Deer Ridge Sales Package, December 2011,” note the following reference: “GG&RC HOA Fees cover maintenance and upkeep of all commonly owned areas including but not limited to exterior lighting, parking lot, landscaping, playground, tennis court, picnic pavilion, recreation building including indoor pool, Jacuzzi, sauna, steam room, game room, offices, golf membership and multi-peril insurance on the same.” In spite of Joe Thomas’ insider knowledge and review of the annual audits, nowhere in his “disclosure” is any reference to the fact that 40% or more of the HOA fees listed are used to fund the average annual operating deficit of $116,117 of RML based on the corporation’s audits. As a consequence, buyers of condos at Deer Ridge are never told of this ongoing capital call requirement, and major risk factor, prior to their purchase of a condo.
Buyers and owners of condos at Deer Ridge are given no choice of owning shares of RML. All owners must own a share of RML and are required to fund RML’s large operating deficits under the guise of required HOA fees that are nearly twice what would be required if RML were not funded by HOA fees. If owners object to this ongoing monthly capital call and do not pay, those owners are threatened with foreclosure of their home at Deer Ridge. This includes the 24 owners who do not use RML’s services – many of whom object to this illegitimately required monthly capital call funding into RML.
Additionally, there continues to be a complete lack of any disclosure whatsoever regarding the required, ongoing, monthly capital call funding for RML’s negative cash flow when a new owner purchases a condo at Deer Ridge. For example, when I bought my unit, Joe Thomas acted as both listing and selling broker on the transaction. At no time did Joe Thomas disclose any requirement for us to own a participating share of RML nor did he disclose that nearly half of the property’s annual HOA fees would be used to support a motel management company’s negative cash flow – even if we were not users of RML’s motel services. It is our understanding from recent property sales that Joe Thomas continues his historical lack of disclosure.
The fact that Joe Thomas also served then, and continues to serve, as General Manager of both GGRC and RML, as well as the principal broker of Ridge Resort Realty (a DBA of RML), gave and gives him complete knowledge and insights into the true operation of both corporations. As such, I contend that Joe Thomas knowingly and deviously omits this disclosure as part of his deceptive trade practices as a real estate agent since many buyers, ourselves included, would have never bought a Deer Ridge condo if proper disclosure of this risk factor had been properly made.
It is my contention that most buyers of small condos under $90,000 do not expect that they will also be unwilling stockholders in a money-losing motel business that will squander almost half of each year’s HOA fees. As such, the lack of this disclosure by broker and General Manager Joe Thomas is especially nefarious and fraudulent.
It is my contention that Luther Parker, president, is aided and abetted by all four other members of the board of directors and the company’s general manager, all of whom are co-conspirators in securities fraud and other securities law violations and have breached their fiduciary duties to all stockholders. The board members are President Luther Parker of Memphis, TN, Vice President Thomas Reise of Friendship, WI, Treasurer Larry Ohm, CPA of Grant Park, IL, Secretary David A. Barone of Monroe, NY and Director Margie Duncan of Florence, KY. General Manager of RML is Joseph Thomas of Kodak, TN. Please see Exhibit F for a complete listing including each individual’s home address, home telephone number and personal email address.
It is my contention that all five board members and Joe Thomas have conspired for years to fraudulently deceive owners at Deer Ridge regarding the profits and losses of RML in order for them to continue to operate their motel business for their own personal gain and benefits – none of which are disclosed to owners. These six individuals are concerned about the growing complaints of owners regarding having the highest HOA fees in the entire East Tennessee area. These six individuals are concerned that if the owners knew the truth about more than 40% of the HOA fees were used to cover the exorbitant losses of RML, these owners would take action to shut down this illegitimate corporation and cut their HOA fees in half. These six individuals are concerned that with an RML shut down, the benefits they uniquely receive from their motel business would be lost. I contend that this is the primary reason that Luther Parker, Larry Ohm, CPA and Joe Thomas lead this conspiracy to fraudulently lie to all owners about the profitability of RML.
TENN. CODE ANN. § 48-2-121 provides that it is unlawful for any person, in connection with the offer, sale or purchase of any security in this state, directly or indirectly, to make any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements made, in light of the circumstances under which they are made, not misleading. In spite of the corporations’ audits showing a $2 million loss during the past 16.5 years, Luther Parker, Larry Ohm and Joe Thomas continue to falsely assert that RML is a profitable operation in order to intentionally mislead stockholders.
Additionally, those who choose to not use RML’s motel services, such as 24 current owners, are subjected to significant discrimination, retaliatory actions and malicious slander and libel as well as being burdened with financial costs not borne by RML participants.
Many of these same board members and Joe Thomas have been in complete control of the board and the operation of Deer Ridge for a decade or more.
The company’s treasurer is Larry Ohm who claims to be a CPA in Illinois. I contend that because of his profession-required understanding of financial statements, Larry Ohm fully understands the audits and the nearly $2 million aggregate loss they show for the past 16.5 years. Yet, he continually and fraudulently misrepresents that RML is making the stockholders money. Please see Exhibit G which clearly shows Larry Ohm falsely stating that, “This clearly contradicts the accusations by anyone that HOA fees and special assessments are being utilized to pay for the costs of operating RML. In truth, in the past, it was RML that was providing a subsidy to GGRC.” This fraudulent and misleading statement by Larry Ohm, CPA, was made to all owners in spite of 16 years of audits of the corporation clearly showing a $2 million loss, or an average loss of $116,117 every year for 16 years!
Exhibit H includes my Warranty Deed, complete closing statement package and my fully executed purchase contract with all attachments showing Joe Thomas as the only broker involved. These documents show that there was never any disclosure of any kind made to me prior to closing that indicate in any way that I would be fraudulently forced to support a money losing corporation such as RML as part of my purchase or a residential condo. Again, if this had been properly and legitimately disclosed, I would have never considered closing on this transaction.
During the past six plus years that I have owned a condo at Deer Ridge, I have documentation that repeatedly pointed out to these board members that they are lying to the owners about RML’s profitability in light of the attached annual audits that they themselves commission each year. Therefore, there can be no legitimate claim by any board member or General Manager Joe Thomas that they had no knowledge of the facts.
In spite of numerous attempts, during the past six plus years that I have owned a condo at Deer Ridge, I have never received a copy of the Administrator’s Book that lists all income and disbursements, along with supporting vouchers. This Administrator’s Book, in this specific format, is required by the Tennessee Horizontal Property Act (§66-27 -113.) It is my understanding that Joe Thomas and the board have never made this Administrator’s Book available to any owner. Ever. As a consequence, no owner or stockholder in RML has ever been allowed to see the books and records as required by Tennessee state law. It is my contention that this stonewalling is driven by the conspiring board’s strong desire to hide certain transactions from the scrutiny of the stockholders – and it is my belief that these hidden transactions hide multiple acts of malfeasance.

Again, based on my many years of experience from owning a NASD broker-dealer and my involvement with numerous private placement offerings and the applicable state and federal securities laws that control such offerings, I strongly believe there may be major, ongoing malfeasance that is negatively impacting the stockholders of RML.

The owners at Deer Ridge are mostly unaccredited investors who, in my opinion, are being consistently and deliberately deceived and victimized by a conspiracy by the board of directors of both RML and GGRC who are personally benefiting from these deceptions. I believe that these ongoing activities and material misrepresentations are violations of the Tennessee Securities Act of 1980, as amended, and put the public at significant risk of immediate and irreparable injury, loss or damage.

Based on the above allegations and the enclosed exhibits, I believe that your investigation will find that Joe Thomas, Luther Parker, Larry Ohm CPA and the rest of the board continue to perpetrate numerous and substantial securities law violations to the financial determent of past, current and future stockholders of RML.

I respectfully request that the Securities Division of the Department of Commerce and Insurance for the State of Tennessee investigate this complaint for the protection of the current and future owners of stock in RML.

I will be glad to be of help to your investigation.

Thank you for your consideration of my complaint.

Sincerely,

Robert Goodman

I hope that the actions of the Securities Division of the Department of Commerce and Insurance for the State of Tennessee will show the nation that we will not tolerate securities fraud and other securities law violations – and that even unaccredited and unsophisticated investors will be protected.

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Stay Tuned!

We live in interesting times. And, hopefully, with the help of the State of Tennessee Securities Division, we will make 2012 VERY interesting for the Gang of Six!

King of All Vegas Real Estate Scams – From Bloomberg Businessweek

Robert — Mon, 19 Dec 2011 16:50:38 +0000

From Bloomberg Businessweek – December 8, 2011

This article was recommended by one of readers. Ron said, “I thought you might find this article instructive, especially about the kneecap job! I don’t have a dog in your fight, but I’m rooting for you.” You can draw your own parallels with regard to Deer Ridge Mountain Resort!

A twisted tale of how homeowners were bilked by those they least suspected: their neighbors!

By Felix Gillette

Before the market crashed and home prices tumbled, before federal investigators showed up and hauled away the community records, before her property managers plead guilty for conspiring to rig neighborhood elections, and before her real estate lawyer allegedly tried to commit suicide by overdosing on drugs and setting fire to her home, Wanda Murray thought that buying a condominium in Las Vegas was a pretty good idea.

At first glance, Murray doesn’t look much like the type of person who would arrive in Las Vegas only to get tangled up in and eventually help unravel a complex criminal conspiracy. At 65, she stares out at the world through thick glasses. She is legally blind. Her eyes never quite seem to focus on any one thing. On a recent Friday morning, she sits at her dining room table wearing a zip-up leopard-print sweatshirt and recounts how she helped to foil a group of lawyers and contractors running amok in Sin City. “They didn’t think there would be four old ladies who wouldn’t put up with their stuff,” says Murray. “They really pissed me off.”

Before moving to Las Vegas, Murray and her husband ran a children’s dance studio in the suburbs of Minneapolis. Every so often, they would travel to Las Vegas on vacation. They loved the warm, dry weather. A poolside condo, far away from the Minnesota winters and a short drive from the Bellagio fountains, seemed like the perfect place to retire.

In 2002 they bought a two-bedroom condo for $105,250 in a new gated community, the Vistana, on the southwest outskirts of the city. The development’s architecture consisted of vaguely Spanish-style stuccoed buildings with ruddy tiled roofs. All told, there were 732 units in the subdivision, hundreds of imported palm trees, three swimming pools, and one cloudless Nevada sky.

Condominium complexes such as the Vistana were springing up across the city. Fueled by low interest rates and feverish demand, there were 32,964 closings on new condominiums and apartment conversions in Las Vegas from 2002 to 2007, according to Restrepo Consulting Group. At the same time, the building boom was creating a growing market for the contractors who fixed the construction problems, such as leaky roofs or faulty electrical outlets, that emerged at the hastily built developments.

In Las Vegas these large-scale repair jobs often involved lawsuits. There were a handful of lawyers in town who specialized in such suits, which pitted the collective owners of a gated community—in the form of nonprofit neighborhood corporations known as homeowner associations—against their developers.

As Las Vegas’s housing supply exploded, so did the competition among lawyers and contractors to represent new homeowner associations in so-called construction-defect lawsuits. It was in this environment, according to plea agreements recently unsealed in an ongoing FBI investigation, that a shadowy outfit cooked up a brazen scheme.

When a new development was nearing completion, the group would buy a couple of units in the community and then transfer partial ownership of the condos to individuals secretly on its payroll, according to court documents. While pretending to be residents of the communities, these “straw buyers” would run for leadership positions on boards of the new homeowner associations. By paying off community managers, hiring private investigators to find dirt on legitimate candidates, and rigging elections, the documents allege, the straw buyers were able to infiltrate boards at several new developments in Las Vegas from 2003 to 2008. Once in control of the boards, the straw buyers would then use their governing positions to steer millions of dollars in construction and legal fees back to their co-conspirators. Targets included the Chateau Nouveau, Chateau Versailles, Park Avenue, Palmilla Townhomes, Jasmine, Pebble Creek, Mission Ridge, Mission Pointe, Horizons at Seven Hills, Sunset Cliffs, and the Vistana.

An FBI spokesperson says that for the time being the agency is not commenting on the case. But already the investigation has provided a window into yet another layer of corruption that took place amid the national housing boom and its subsequent hangover—a period that saw a surge in real estate malfeasance of every imaginable variety, including false loan applications, predatory lending schemes, illegal property flipping, equity skimming, and “air loans” (loans for property that doesn’t exist). According to FBI data, the number of suspicious activity reports related to real estate fraud filed by financial institutions jumped to 67,190 in 2009 from 6,936 in 2003.

To this history, Las Vegas has managed to add another florid chapter. So far, prosecutors have reached plea agreements with 10 co-conspirators. Many more are expected to appear in front of judges in the coming months. Says Murray: “We’re all going to be sitting in the front row, watching.”

Not long after moving into the Vistana in 2002, Murray got a letter in the mail from Nancy Quon, a partner at the local law firm Quon Bruce Christensen. Parts of the development hadn’t even been painted yet, and already Quon was soliciting homeowners for a possible construction defect suit.

Among her drab fellow attorneys, clerks, and paralegals, Quon stood out. She had long dark hair, hazel eyes, and pale skin. She drove a red Lexus convertible. During her 10-year marriage to an insurance attorney, she had two daughters and worked as a legal secretary. After a divorce in 1988 she went back to school and earned a law degree. One of her best friends was a Las Vegas judge. At night they did Pilates together.

For years, Quon co-hosted a TV show on Channel 2, Homeowner Talk, in which she gave viewers advice about the city’s razzle-dazzle real estate market. A wine connoisseur, Quon sometimes gave bottles she had collected to charity.

After moving into the Vistana, Murray volunteered to fill a temporary vacancy on the community’s fledgling homeowner association board. The five-member board would be responsible for governing the day-to-day operations of the development. At the time, she says, there wasn’t much competition over the unpaid positions, which were low on perks and high on potential hassles.

In those early days, according to three longtime residents, construction problems at the Vistana were numerous but relatively minor. Some of the units had leaky roofs and windows. There were civil engineering issues involving the sidewalks. The internal fire and security systems didn’t work. Insulation, soundproofing, and plumbing needed fixing in some units.

In July 2003 the board members voted to retain the law firm Angius & Terry—rather than Nancy Quon’s firm—to represent them in a construction defect suit against their developer, Rhodes Homes. According to Murray, Quon told the Vistana residents, “I’ll be back.” Through her public-relations representative, Quon declined an interview request.

In the summer of 2004, Angius & Terry initiated the suit against Rhodes Homes. At the time, says Murray, the potential for a speedy settlement seemed promising. Rhodes Homes has since declared bankruptcy, and a representative for developer James Rhodes declined an interview request.

Murray first sensed trouble the following October, when the Vistana held its annual board election. The results were surprising. Two newcomers, an ex-cop and a union foreman, won spots on the board. It was odd, if only because nobody recalled seeing much of either man around the neighborhood. Shortly after, the two appointed another stranger to a vacant position.

In Nevada, state law requires that to serve on a homeowner association board, an individual must own property in the development. On a hunch, Murray and a group of her neighbors pulled some property records. As it turned out, the newest appointee had recently purchased a mere 0.5 percent of a single condo at the Vistana. Digging around a little bit, the Vistana residents claim they found records that the new board members were employees of Silver Lining Construction.

Murray wasn’t sure why somebody who didn’t actually live in a condo community would want to serve on its unpaid board. It seemed suspicious. In the weeks to come, Murray, along with three other like-minded ladies at the Vistana, formed a kind of amateur detective agency. They searched state property records. They dug deep into Google (GOOG) search results. They even did the occasional stakeout. The more they investigated, the more arrows they found pointing to Silver Lining Construction.

The change at the Vistana came fast that winter. In January 2005 the three new board members on the five-person board canceled a mediation session with Rhodes Homes, fired their attorneys from Angius & Terry, and replaced them with a firm called Spilotro & Kulla. John Spilotro was well known in Vegas not only because of his success as a criminal lawyer but also because of his famous uncle, Anthony “The Ant” Spilotro. During the ’70s, Anthony Spilotro moved from Chicago to Vegas allegedly to help run various mob-related businesses, including the Stardust Resort & Casino. In the years to come he ran roughshod over the city, forming a notorious burglary outfit called The Hole in the Wall Gang and touching off a spasm of street violence that drew national attention, and ultimately, a federal crackdown on organized crime in Vegas.

In 1986 police found Anthony Spilotro’s body several feet under an Indiana cornfield. They suspected he’d been buried alive. In the 1995 Martin Scorsese-directed movie Casino, Joe Pesci plays a character based on Spilotro. A quarter-century later, the surname Spilotro still gives some people in Vegas the heebie-jeebies. “When I heard that name,” recalls Murray, “I went, ‘Oh, you’ve got to be kidding me.’ ” (Spilotro did not respond to a request for comment. He has not been accused of any wrongdoing.)

That January the new members of the Vistana board hired a property management group, Platinum Community Services, run by Lisa Kim. Her husband, Vistana residents would later discover, was Ben Kim, a member of the Las Vegas Metropolitan Police Dept.’s fraud unit. On the side, Ben Kim owned and operated the Courthouse Cafe, a cafeteria inside the city’s regional justice center. He had two partners in the business, lawyer David Amesbury and Leon Benzer, head of Silver Lining Construction.

Murray and her posse of neighborhood sleuths had seen enough. They went to the Las Vegas police, who referred them to the Nevada Real Estate Division, a governmental agency charged, in part, with investigating real estate fraud. The Vistana residents filed a formal complaint and in February 2005, hoping to reclaim control of their board, conducted a recall election. When the votes were counted, their efforts had failed. Suspecting the ballots had been tampered with, Murray organized a second recall election in which the votes were tallied at the neighborhood pool rather than at the association office. This time all the board members connected to Silver Lining Construction lost. Afterward, however, they refused to step down.

In response, the original members of the Vistana board helped to file a civil suit aimed at removing the suspected interlopers. According to Murray, when they showed up in court for the first hearing, they were shocked to see a robust team of eight or so lawyers to defend the “straw buyers.” She couldn’t believe so many billable hours were being racked up to protect a handful of unpaid volunteer positions.

In the end, the jumbo team of lawyers triumphed, the homeowners lost the suit, and the Silver Lining-connected board members carried on.

In the meantime, Spilotro & Kulla hired Nancy Quon, the convertible-driving TV lawyer, to restart the Vistana’s construction defect suit.

In March 2005, on the advice of Quon, the Vistana homeowner association took out a $1 million loan to pay for some emergency repairs while they waited for the lawsuit to move forward. The board hired Benzer of Silver Lining Construction to make the repairs.

All across Nevada, people knew that if you needed to win a tricky election you might want to call a political operative named Steven Wark. In 1988 as a state campaign manager, Wark helped Pat Robertson win Nevada’s Republican Presidential caucus. In 2004, according to his interviews with several news organizations at the time, Wark raised money to help get Ralph Nader on the ballot in Nevada as a way to siphon off votes from Democratic hopeful John Kerry; George W. Bush went on to narrowly win the state. Over the years, Wark had also served as chairman of the Nevada Republican Party, hosted a fundraising event for Rudolph Giuliani, and managed several successful campaigns for Mike Montandon, the former mayor of North Las Vegas.

In spring 2005, having proven his value in Presidential and mayoral campaigns, Wark focused on a smaller political battleground. He joined the homeowner association board at the Vistana. Like the members of the board who appointed Wark to the vacant position, he did not live in the community but had recently purchased a 1 percent share of one Vistana condo.

It didn’t take long to discover that Wark, too, had a connection to Benzer. According to records from the Nevada Secretary of State, Wark and Benzer co-owned a business called Allied Environmental Solutions. Through his lawyer, Wark declined to comment.

By the time Wark arrived on the scene in 2005, the community meetings were growing increasingly heated. As a result, Wark and his four fellow allies on the board began arriving at meetings inside the cabana near the front gates of the Vistana, which everybody called the clubhouse, accompanied by entourages of burly men.

According to Murray, residents who asked the board too many pointed questions risked getting hit with fines on trumped-up charges of violating association rules. Residents recall that when confronted with the intimidation tactics, Wark would habitually drop the names of his powerful allies in Nevada politics. “They acted like they were bulletproof,” says Vistana resident Bruce Wallace.

In the fall of 2007 the Vistana board announced it had reached a $19.1 million settlement with Rhodes Homes. Of that—according to a recent accounting by current Vistana board members—about $11 million in legal fees and reimbursement expenses went to two firms: Spilotro & Kulla and Quon Bruce Christensen. That left $8.1 million for repairs.

One night that September, Amesbury, a lawyer for Silver Lining Construction, stood up at a meeting in the clubhouse. Amesbury, who owned a small firm in Las Vegas, specialized in criminal law. He was also a co-owner, along with Benzer and Kim, of the Courthouse Cafe. That night, Amesbury told the Vistana residents that in 2005 the board had signed a “right-of-first-refusal” contract with Silver Lining Construction. The contract essentially guaranteed Benzer’s company 100 percent of the construction remediation money from the settlement. Moving forward, he said, there would be no competitive bids with other contractors. Amesbury did not respond to a request for an interview sent to his attorney.

Over a roughly six-month period, from the fall of 2007 through the spring of 2008, various teams of subcontractors working for Silver Lining Construction came and went from the Vistana—painting buildings, replacing windows, and patching roofs. By May 2008, all but $450,000 of the $8.1 million was gone.

Shortly after, as the money ran out, the board members connected to Silver Lining Construction stopped showing up at meetings. “They just disappeared,” says current board member Wallace.

On Sept. 24, 2008, the day Murray had been anticipating finally arrived. That morning, and in the days that followed, agents from the FBI served search warrants and confiscated records at several businesses, including the offices of Silver Lining Construction, Platinum Community Services, and Quon Bruce Christensen.

Murray learned about the raids from a report on TV by Channel 8 investigative reporter George Knapp. “It blew me away,” she says. “I was so relieved that it was finally happening.”

While the FBI didn’t go into much detail about the investigation, it was clear from media reports that the scope extended far beyond the Vistana. “We had no idea how far-reaching it was,” says Murray. There were more surprises ahead.

On the morning of Oct. 28, 2010, Daniel Webb, a corrections officer with the Las Vegas Metropolitan Police Dept., was awakened before dawn by a phone call. It was his younger brother, William Ronald Webb (who goes by “Ron”), calling from San Diego. He wanted to know if Daniel could get up, drive across the city, and check in on Ron’s girlfriend, a well-to-do attorney named Nancy Quon. Ron was worried something had happened to her. She hadn’t been answering her phone all night.

Webb later testified to a grand jury that at first he was reluctant to indulge his brother, who sounded drunk. There was a history of mental illness in their family, and Ron had been acting paranoid recently, particularly about the FBI’s investigation into his girlfriend’s law firm.

Eventually, Webb gave in and drove over to Quon’s two-story house in a tony gated community on the west side of town. He retrieved the spare key from under a rock and let himself into the house. Among other amenities it had a wine cellar, a fire pit, a swimming pool, and a Jacuzzi. As soon as he stepped inside, he saw smoke. The house was on fire. He ran outside and called 911.

With an ambulance on the way, Webb rushed back into the house to look for Quon. A few minutes later, in the TV room off the kitchen, he reached into a pile of blankets heaped on a puffy couch and felt a leg. It was Quon. Her eyes were open, and her face was gray. He picked her up, carried her out to the front yard, and began CPR. On the second cycle, she started to cough.

The paramedics arrived shortly. They checked Quon and found she was breathing shallowly, had pinpoint-size pupils, a strong pulse, and was unresponsive. All were signs, one paramedic would later testify, of a narcotic overdose. They treated her with a “narcotic antagonist” drug called Narcan.

A few hours later, Daniel Webb went to the intensive care unit where Quon was being treated. He later testified that Quon was thankful and tried to explain to him what had happened. She allegedly told him that she took some sleeping pills, climbed in the Jacuzzi, and drank a can of Four Loko—a highly caffeinated, fruity malt beverage typically more popular with rebellious teenagers than wine connoisseurs such as Quon.

Afterward, she told Webb, she felt dizzy. She went upstairs, lit some candles, and drew a bath. It was all hazy, but at some point she must have gone downstairs to lie down in the TV room, she allegedly told Webb. Perhaps her bathrobe had accidentally knocked over a candle.

In August 2011, 10 months after the fire, a Clark County grand jury indicted Quon on multiple felony charges, including first-degree arson and insurance fraud.

According to prosecutors, Quon, 51, had taken some sleeping pills, drank a Four Loko, and set her house on fire in an attempt to kill herself. She wanted to take her life, they argued, to avoid the embarrassment of being arrested in the FBI investigation. They further argued that she was trying to do so in a way that would pay out a hefty insurance policy to her two adult daughters, whom she supported financially.

The prosecutor’s case included extensive testimony from Robert Justice, a 45-year-old mechanic and occasional drinking buddy of Quon’s boyfriend, Ron Webb. Justice told the grand jury that weeks before the fire, Webb had tried to hire him to buy the couple a lethal amount of the so-called date-rape drug GHB. According to Justice, Webb wanted the GHB because he thought it wouldn’t turn up in an autopsy. Justice told Webb there were better ways to kill yourself without arousing suspicion. He suggested eating some sleeping pills and then downing a couple cans of Four Loko. Ron Webb is currently in jail, facing multiple charges including conspiracy to commit murder. He has pled not guilty to all charges.

The police arrested Quon in Henderson, Nev., on the afternoon of Aug. 17. At the time of her arrest, she was carrying her passport and $7,000 in cash.

In subsequent court filings, her lawyers have denied that Quon set the fire and have rejected the prosecutor’s assertion that she wanted to kill herself for insurance money and to escape arrest. Her attorney, Thomas Pitaro, has told reporters the prosecutor’s case is based on an “Alice in Wonderland” theory.

Quon is free on $50,000 bail.

These days, life is much quieter at the Vistana clubhouse. Amid the seasonal decorations, there are signs the residents are happily moving on from their ordeal, even as they savor the prospect of watching their former attorneys, property managers, and board members shuffle off to jail.

On one side of the clubhouse, a poster marked “Before and After” leans against the wall. The “before” section features photos of the Vistana during the years when the straw buyers were managing the community. The images show untrimmed palm trees, broken barbecue grills, cracked pool decks, patches of dead grass, dented carports, and a busted front gate. The “after” photos show the gradual, physical recovery of the Vistana in the time since homeowners who actually live in the community regained control of the board.

On bulletin boards a few feet away, dozens of newspaper clippings from the Las Vegas Sun and Las Vegas Review-Journal chronicle the expanding number of individuals who have pled guilty in the FBI investigation. The display is labeled “Wall of Shame.”

The condominium schadenfreude hit a new high on Aug. 30 when Wark, the former chairman of the Nevada Republican Party, appeared before a federal judge and pled guilty to one count of conspiracy to commit mail and wire fraud. The maximum sentence is 30 years in prison. He is awaiting sentencing.

In court documents filed as part of the plea agreement, Wark admits to helping rig elections at the Vistana. Like most condominium complexes built in Las Vegas during the boom, the Vistana had a high percentage of owners who were investors living out of state. According to the court documents, Wark and his crew won the elections, in part, by targeting out-of-state owners unlikely to participate in board elections. They would fill out a ballot on the owner’s behalf without the individual’s knowledge, transport the documents to the owner’s home state, then mail the ballot back to Nevada. The ballots would arrive bearing the correct postmarks, lending the votes credibility.

The fake absentee ballots were used to tilt the campaigns in favor of the straw buyers. When homeowners became suspicious, the court documents reveal, the conspirators would bring in supposedly independent “special election masters” to preside over the vote counting. According to several plea agreements, the election overseers were paid off, too.

Over the past three months, nine more guilty pleas have followed. So far, the ranks of the admitted conspirators have included Deborah Genato of Platinum Community Services, which worked as property manager for the Vistana; Daniel Solomon, a straw purchaser who served on the Vistana board; and Amesbury, Kim and Benzer’s former partner in the Courthouse Cafe. Neither Ben nor Lisa Kim have been charged with a crime.

On the morning of Nov. 16, a few weeks after reaching a plea agreement with prosecutors, Amesbury was found on the streets of a Las Vegas suburb severely beaten with multiple injuries, including two broken kneecaps. According to a story by Jeff German in the Las Vegas Review-Journal, police have so far found no evidence linking the beating to the FBI investigation.

On a recent Thursday evening at the clubhouse, the Vistana board members met with their lawyer, Richard Haskin, to discuss the the community’s civil suit alleging that the straw buyers, in cahoots with Benzer, vastly overpaid for Silver Lining’s services. Haskin is working on an amended civil RICO (Racketeer Influenced and Corrupt Organizations Act) complaint that will add Quon as a defendant and seek upwards of $8 million in damages. “I was privy to the repairs,” says Vistana resident Tony Kneip, himself a retired general contractor. “They were outrageously high.”

Lawyers for Silver Lining Construction continue to allege the homeowner association owes Benzer’s company $750,000. “It’s a classic breach-of-contract, failure-to-pay case,” says Benzer’s attorney, Sigal Chattah.

Whether the Vistana can retrieve any money remains to be seen. The criminal fire investigation revealed that although her law firm has shut down, Quon still possesses significant assets. (No one else at Quon Bruce Christensen has been indicted.) During a court hearing in August, prosecutors told the judge that in 2009, Quon made transfers of $2.7 million and $2.9 million into an offshore bank account. Last year she bought her daughter an apartment in New York City, paying $750,000 in cash.

“The bottom line for the homeowners is we’d like to see a lot of pain and suffering on their end,” says board member Larry Fitch.

In the meantime, thousands of people who bought condos during the boom are still coping with their own financial hardship. Two-bedroom, two-bath condos at the Vistana were going for $200,000 in 2007. In November a 929-square-foot two-bedroom, two-bath unit sold for $59,000.

Murray and her husband moved out of the Vistana in 2008 and now live in a nearby development. “I couldn’t take the pressure anymore,” says Murray. “Everything we did, they came after us. I’d had enough.”

Eventually, she and her husband let their dream home slip into foreclosure. “The reputation was out there, and nobody wanted to live there,” says Murray. “So we let it go. … I took a big hit.”

These days, Murray stays as far away from homeowner associations as possible. She is, however, looking forward to seeing where the FBI’s investigation ultimately leads. Many mysteries remain.

To this day, Murray has never laid eyes on Leon Benzer. No matter how many times they typed his name into Google or drew up elaborate maps linking him to members of their homeowner association, the residents of Vistana never seemed to get a glance of Benzer in person. He always kept his distance. (Through his lawyer, Benzer declined an interview request.)

Benzer’s primary business, Silver Lining Construction, has likewise kept a low profile. In 1998 a rare article about the company in the Review-Journal reported that Silver Lining Construction had been hired to renovate the Pioneer Club, a historic building in downtown Las Vegas that had served as everything from a restaurant to a casino to a brothel. Benzer’s job was to turn the space into a gift shop. “A lot of contractors are afraid of this kind of work because of the hidden nightmares you can run into,” he told the paper. “We like the challenges. We spent six months in preplanning, and our philosophy has always been Murphy’s Law—anything that possibly could go wrong will.”

Over the years a lot seemed to go right for Benzer. He formed a charity called the Benzer Autism Foundation; a music production company, Benzermusic.com; an investment group, Silver Lining Investment; and a boutique liquor brand, Benzila Tequila, that was reportedly made from agave plants that grew on Benzer’s ranch in Mexico.

Although he has not been charged with any crime, Benzer’s businesses are now all shuttered. “Basically, between the economy and the federal investigation, there’s not much left,” says Chattah, his attorney.

Benzer, who is in his mid-40s, continues to live in Las Vegas, she says, and has a source of income. When asked about the rumor that Benzer now works as a local cab driver, Chattah responds, “He might be.”

In 2008, before the FBI raided his offices, Benzer created a channel on YouTube where he posted clips of celebrities giving red carpet shout-outs to Benzila Tequila and his foundation. You can still watch the likes of Tom Jones, Anthony Michael Hall, and Patrick Swayze tossing out paeans of support for Benzer and his charity work. “It’s God’s plan,” says ESPN’s Stephen A. Smith in one video. “If you want to make it to heaven one day, this is a good way to start.”

Gillette is a staff writer for Bloomberg Businessweek in New York.

Independent Legal Opinion: GGRC Board Guilty Of Numerous Violations / $353,500 Assessment Is Null And Void

Robert — Thu, 18 Feb 2010 18:45:42 +0000

Independent Legal Opinion: GGRC “Board” Guilty Of Numerous Violations / $353,500 Assessment Is Null And Void

The following is a copy of an email sent to Luther Parker, other “board” members and Joe Thomas on February 18, 2010 describing the legal findings of a real estate law firm concerning Gatlinburg Golf and Racquet Club – GGRC – and its subsidiaries RML and Ridge Resort Realty.

The findings of the law firm will probably change EVERYTHING about the way Deer Ridge is operated and managed.

Luther and the Board:

As I mentioned during the Special Meeting of February 6, 2010, I had personally hired a Knoxville-based real estate law firm to review many of the major conflicts and issues that have arisen between myself (and other owners) versus the Board, Joe Thomas and the decisions and policies you have been attempting to implement.

My instructions to the law firm, Howard and Howard ( www.howardhowardlaw.com/ ) and Senior Partner Lewis Howard, Jr. were to objectively and candidly evaluate these issues with the goal of determining the legal validity and the merits of our pursuing a lawsuit against GGRC and/or the individuals who make up the current board along with Joe Thomas, the general manager. This firm does not currently represent us for any pending litigation – but may be hired should we move forward.

The full legal opinion I received from them is attached to this email – with each and every part shown and discussed below – with my comments for each section. Note: I am not an attorney and do not practice law – so these are my interpretations of the sections of the attorney’s letter – trying to convey the realistic meaning from the necessary legalese.

Executive Summary Of Attorney’s Findings

For those who prefer to start with an executive summary, here are the bottom line findings by the attorney with regard to GGRC and the actions of the “Board” and Joe Thomas:

You are REQUIRED to charge all owners ONLY in accordance with the Master Deed Percentages for everything: monthly assessments, water, cable TV, etc. This means no more 82% overcharge to all 1-1 owners.
You are REQUIRED to provide all owners with COPIES of everything they request including invoices, check stubs, bids, etc.
You are REQUIRED to get BOTH the 75% positive vote by owners AND the 90% positive vote by mortgage holders of all condo loans at Deer Ridge. Therefore, ANY monies you spend on walkway ramps will be your personal responsibility to pay.
You are NOT allowed to ever have ANY special assessments – hence, the Asinine Assessment of $353,500 is NULL and VOID. No owners are required to fund a penny of this money – and any monies received MUST be returned to those owners who have already paid.
You and other board members are going to be liable to repay ALL overcharges to both current and past 1-1 owners, along with interest. (This means you will be required to pay us back over $10,000 in our case – and more or less the same to other 1-1 owners – past AND present.)
RML and Ridge Resort Realty are NOT legitimate – and must pay back every penny of GGRC’s money ever used for them – and these companies must be expeditiously sold.
All “annual meetings” held in April are not official Annual Meetings – hence, all decisions, and votes made, INCLUDING board member elections, are NULL and VOID. This means that Luther Parker and every other member of the “board” are, in fact, NOT members of the Board and have no power whatsoever including setting assessments, making special assessments, setting rules and regulations, agreeing to any contracts about anything, etc. We will sue to have a special master appointed by the court.
No board member or committee member may receive ANY compensation INCLUDING reimbursements for travel, meals, maid service, free storage or special remodeling of board member’s OR committee member’s units. When we do our review of the books and records, we are going to add up every penny that has ever been paid and individually sue each of you for the full and complete reimbursement of all of this money.
The entire current “board” has committed multiple ultra vires acts that were outside the scope of authority granted you by the Master Deed and Bylaws even if you were a legitimate board. As such, these acts show gross negligence on your part and on the part of your “unified board that speaks with one voice.” As noted in the attorney’s answer to Question 12, these illegitimate acts of yours are actionable with all monies recoverable from you and all other “board members” and Joe Thomas personally – probably on a “joint and several” basis. That means we are going to go after the FULL amount for each illegitimate act from you and each of the board members until we collect EVERY penny that was spent on decisions that were outside the scope of authority. Based on my prior blog postings, I have already identified over $120,000 that has been spent without the proper Article XII approvals.

Those are pretty much the highlights – and as you can see, most of the above will have a MASSIVE impact on GGRC, RML, Ridge Resort Realty and each member of the “board” personally. It will also rightfully put $10,000, more or less, back into the pockets of all PAST AND PRESENT 1-1 owners who join with us in the lawsuit against those responsible for our gross overcharge of fees.

The above issues are the way things SHOULD have been done all along – and we WILL hold those accountable who have capriciously and arbitrarily chosen to ignore the controlling documents of Deer Ridge and GGRC Regime.

You all will NOT be able to claim ignorance on these issues – all of these issues have been brought to your attention multiple times over multiple years.

What Say You Luther?

You are hereby put on notice to immediately resolve all of the above issues.

If you do not, one of our expected remedies will be to file a derivative action suit on behalf of GGRC naming each of you, individually, as defendants in that lawsuit. This particular lawsuit will allow us to recover funds from all of you, individually, and require that the entire board be fired, with cause, for gross negligence. And, since this will be GGRC suing you, none of you will be able to use any past or current attorney who has represented GGRC.

Another legal action we intend to take will be to immediately gain an injunction blocking the special assessments and inter-pleading any and all funds already received to a court controlled account. Another legal action we intend to take will be a declaratory judgment suit over the above interpretations of the Master Deed and Bylaws.

Another legal action we intend to take will be for multiple past and current 1-1 owners, such as myself, to sue the board members, individually, for the 82% overcharge of all costs going back for years. Other, additional litigation is planned as needed. Bear in mind that we intend to also sue each of you for full recovery of all of our legal and court costs – and since it is fairly apparent we will win the issues, we expect to win on the legal fee recovery too.

Discovery motions will be immediately made that will require GGRC to turn over COPIES of ALL books and records related to GGRC and RML, et al.

So, Luther, are you going to continue to try to self-servingly block full and complete implementation of all of the above issues – or do you want to save everyone time, hassle and money by settling all of these issues here and now before we take the next steps? If you attempt to delay the above by squandering GGRC money for legal fees to protect yourself and other board members and Joe Thomas, you will be held accountable for this waste of money also.

You have THREE DAYS to satisfactorily respond to this email before I move forward with the necessary steps to accomplish all of the above. This process will start with a postal mailing to all owners, providing them with a copy of the attorney’s letter, advising them that they should not make any assessment payments and asking for them to join with me as co-plaintiffs against you and the rest of the “board.”

So, what say you, Luther? How do you want to get to the inevitable Point B?

The Attorney Letter – And Analysis

The following dissects the letter from the attorney with snapshots of each part of the entire document.

This first image shows the law firm, date, attorney and that it deals with GGRC issues. The letter responds to 13 sets of questions I posed with regard to Deer Ridge and the operation and management of GGRC, the property and with regard to RML.

This point discusses that all owners have a right to COPIES of all the books and records. Wanting to make sure it was even more clear, I received the following email from the attorney:

This makes it crystal clear that ALL owners have a right to COPIES of books and records related in any way to GGRC. Period.

Bear in mind that as soon as we file any of our planned litigation, we WILL produce a motion for discovery FORCING you to turn over COPIES of all of these documents.

Also, bear in mind, Luther, if we have to litigate this and go for a declaratory judgment, you will most certainly lose on this point. This should not even be a point of issue with a Board that was open, transparent and honest.

So, based on the above, are you and the Board going to continue to interfere with the owners have their legal rights to copies of the GGRC et al books and records?

Luther, this is the crux of most of the intolerable abuse of power by Joe Thomas and the Board. You all have claimed reliance on these two sections to blatantly ignore the requirements of the Master Deed and Bylaws. As you can see, the attorney is saying exactly the same thing I have been telling you – Article III, Section 9(c) does NOT let you get away with your “arbitrary and capricious reallocation of ownership in the common elements or the common expenses.” Likewise, the same thing for Article V – which means you cannot simply charge the same amount to all unit sizes for any of the expenses.

Luther, ALL allocations and common expenses, including the HOA fees, the water, cable TV, telephone, etc. MUST be charged in accordance with the Master Deed Percentages. Period. You all do NOT have a choice. You all CANNOT be arbitrary and capricious. You MUST abide by the Master Deed Percentages. This should not even be a point of issue with a Board that was open, transparent and honest. So, based on the above, are you and the Board going to continue to be arbitrary and capricious – or are you going to IMMEDIATAELY adjust all costs to reflect the Master Deed Percentages?

Point 3 relates to your statement in the November budget meeting that, “an 82% over charge to the 30 1-1 owners was ‘fair and equitable.’”

Clearly, it is NOT.

So, based on the above, are you and the Board going to continue to be arbitrary and capricious – or are you going to IMMEDIATELY adjust all costs to reflect the Master Deed Percentages – and stop overcharging all 30 1-1 owners by 82%?

Uh oh. Trouble in River City for the Board. Could it be that special assessments are NOT authorized whatsoever??? See the interesting details below.

As you can see, all of those overcharges you guys have made for years can be recouped by me and all the other victims of your “arbitrary and capricious” wrongly calculated assessments. For me, that adds up to over $10,000 and I want all my money back with at least interest. It doesn’t look like I can get monetary damages – at least on this point – though it may depend on what type of litigation we pursue.

NOTE: All 1-1 owners now, and in the past, will have a CLAIM for the board’s arbitrary and capricious overcharges – to get back your money and interest and probably legal fees to sue them! If you want to join with me as a co-plaintiff, please email me ASAP!

Here is a BIGGIE – RML and Ridge Resort Realty are NOT legitimate, just as I have claimed for years. RML was illegally formed by the board in 1987 with zero vote of the owners for one thing – but even beyond that point, it is NOT an appropriate use of any funds as described above.

We expect to file a derivative action suit, as GGRC, against you, individually, and all the board members and Joe Thomas, individually, to force the IMMEDIATE divestiture of both RML and Ridge Resort Realty and for reimbursements of any and all costs associated in any way with the formation and operation of these two illegitimate companies.

I personally want every penny of MY money back that was ever spent in any way to support RML and Ridge Resort Realty.

If you would like me, with my 15 plus years of real estate experience to help with the quick and IMMEDIATE divestiture of these companies, please let me know.

As I have claimed, all Annual Meetings held in April are NOT Annual Meetings as defined by the Master Deed. And, since the Master Deed REQUIRES that the Board of Directors is ONLY elected at the Annual Meeting, you, Luther Parker, and the rest of this current “Board” were NOT properly elected and any and all decisions made by you all are null and void and without effect. As such, I intend to file suit to have the Court appoint a Special Master to oversee all operations of GGRC and the immediate divestiture of both RML and Ridge Resort Realty.

Now, if you really hurry, since this is February 18th, you COULD get a quick 30 day notice out to all owners moving the April “Annual Meeting” to the first quarter as required by the Master Deed. That would allow for the proper election of the new board without the need for a court-appointed Master. However, if you wait or still try to hold the “Annual Meeting” in April, and I am successful with my point of law, this means that the Master would be running GGRC until the first quarter of NEXT YEAR.

So, what say you Luther? Are you going to quickly try to abide by the controlling documents of our Regime – or are you going to toss it all into the court appointed Master’s hands?

There are SEVERAL very interesting parts to the attorney’s response to this Question 8.

First of all, just to be clear to Tom Reise – you guys are NOT in the “driver’s seat” and you cannot simply ignore the provisions of Article XII REQUIRING you to get the 90% vote of the mortgage holders of all condo units at Deer Ridge! If you all proceed in ANY way with the demolition or construction of your aluminum walkway railings, you will be in direct violation of the Master Deed. Period. You have been WARNED.

The second interesting concept here is the one mentioned in one of my recent blog postings: ultra vires acts. I warned you all in that posting that you had each better talk with your individual attorneys because ANYTHING you do, or HAVE ALREADY DONE, that are outside the scope of authority granted you by the Master Deed and Bylaws, subjects EACH of you personally to be grossly negligent. This means that you will NOT be able to rely on the D and O insurance to protect you, nor to use legal counsel of GGRC to defend you.

It also means that some owners, me included of course, can name you all individually in a derivative action suit. You all need to really understand how a derivative action suit works – since that means we can sue each of you, on behalf of GGRC as our plaintiff. Now, that sounds interesting. And, it means that all the owners would get paid back from your pockets – not from GGRC’s bank account. For me, that will be most fitting – considering the long term abuse of power that has existed at Deer Ridge.

Now, are you SURE you want to start spending YOUR money replacing those walkway railings?

Alas, this was the one point that did not YET go our way. We are still investigating ways to get this one to happen too, but we may have to wait until we replace three of the current board members. We also expect that Tennessee and other states will follow Nevada’s lead in REQUIRING all HOA board meetings be digitally recorded.

Now, things get very interesting.

NOTE TO ALL – BASED ON INDEPENDENT LEGAL OPINION,
IT LOOKS LIKE NO ONE IS REQUIRED TO FUND ANY PART
OF THE $353,500 ASSESSMENT!

That felt good to say. This part was so amazing that I even went back to the attorney and asked for clarity. He assured me saying he stands by this answer. What this means folks is that the board, even if they were properly elected – which this one is NOT – can never do a special assessment. They can only raise the monthly fees to properly build a reserve fund (the monies that were in the reserve fund as recently as three years ago have seemingly disappeared – probably in covering the negative cash flow from operations of RML.)

Additionally, even if it had been legal, the Board’s unwillingness to provide us copies of all the records tied to this Asinine Assessment would have invalidated the assessment.

If you would like to join with me in blocking your upcoming assessment, please let me know ASAP. We intend on filing an injunction against GGRC and the Board from even attempting to enforce this assessment until full resolution of our lawsuit(s).

Clearly, the “Board” has not acted fairly and equitably with regard to me, or other full time owners at Deer Ridge. Stay tuned for a LOT more about this.

Luther, we believe that there will be a massive amount of evidence that will show that you and the other “board” members and Joe Thomas have repeatedly committed ultra vires acts that were outside the scope of authority granted you by the Master Deed and Bylaws. As such, these acts will hopefully show gross negligence on your part and on the part of your “unified board that speaks with one voice.” As noted in the attorney’s answer to Question 12, these illegitimate acts of yours are actionable with all monies recoverable from you and all other “board members” and Joe Thomas personally – probably on a “joint and several” basis.

That means we are going to go after the FULL amount for each illegitimate act from you and each of the board members until we collect EVERY penny that was spent on decisions that were outside the scope of authority. Based on my prior blog postings, I have already identified over $120,000 that has been spent without the proper Article XII approvals. I am sure as we dig into the records, we will discover a LOT more. Would you like to write us a check for the full $120,000? Or, would you rather have Margie or David pay all of that for you?

This Question 13 answer is pretty crystal clear Luther. No one gets a penny for serving on the Board. This means NO reimbursement for anything including travel, meals, maid service, free storage or special remodeling of board member’s OR committee member’s units. When we do our review of the books and records, we are going to add up every penny that has ever been paid and individually sue each of you for the full and complete reimbursement of all of this money.

For example, let’s talk about Margie since she seems to have been on the Board for years. If she got $300 per meeting for travel and attended 5 meetings a year, which is $1,500. Let’s assume other stuff added up to another $500 a year for a total of $2,000 a year in illegitimate benefits. If she had gotten these ill gotten gains for say 10 years, this means that Margie will immediately owe us $20,000.

If this same amount was paid out to ALL board members and some committee members, the total amount that could be owned back could exceed $200,000. That’s almost enough to get all the work done at Deer Ridge that REALLY needs to be done.

Of course, my personal intuition is that she and other board members have received a LOT more quid pro quo that will have to be paid back – but we will see.

Have You Noticed A Trend Here?

I assume you have noticed that I have been spot on RIGHT on everything I have been saying for years on my blog – and that your vilification, slander and libel contained in your diatribe letter you recently mailed to all owners was obviously full of lies and disinformation as a way to attempt to falsely discredit me. This objective legal opinion validates virtually EVERYTHING I have been saying for years. And, if need be, we will take the board members to court to prove it with finality.

I, along with many other owners, are sick and tired of the board’s “arbitrary and capricious ways” of illegitimately running GGRC and Deer Ridge – and I continue to be highly motivated to resolve these issues once and for all so that this property is finally properly governed by its Master Deed and Bylaws.

Luther, if you want these matters settled, you have three days. The clock is already ticking.

Govern yourself accordingly.

Robert
A-202

Deer Ridge History – Historical Documents And Smoking Guns – Coming Soon

Robert — Tue, 09 Feb 2010 05:03:36 +0000

We have just been presented with two massive notebooks of historical documents on Deer Ridge that date back to about the time the property was built!

This 11″ stack of papers make absolutely fascinating reading – board minutes, incorporation papers for RML, annual meeting presentations, promises, excuses, provisional hiring, political force outs, side deals – the list goes on.

We have already begun the process of scanning ALL of this in as an Acrobat file that will be available to ALL owners.

This is a massive and time consuming project for both Jan and me – but we are doing this as a service to all owners at Deer Ridge – and will be adding this file to our “Documents You Can Download” section on the blog in the next couple of weeks – as soon as our schedules allow.

We have already found a couple of MAJOR “smoking guns” that will be used in our upcoming litigation. The great thing about it being totally digital is that it is easy for all owners to have a copy – and also easy for us to send a copy to our attorney and to the Court.

Another great thing, in case you don’t know this: Once it is scanned into Acrobat, it performs a complete OCR – making every bit of the documents keyword searchable! (You have to download the file and open the file with the free version of Acrobat to use this function – but it works GREAT!)

That means that, on any of the Acrobat documents I have done for Deer Ridge, you can type in whatever keyword or key phrase that interests you – and immediately find all occurrences of interesting phrases like, Joe Thomas, assessments, walkways, master deed, etc.

Try it, you will like it.

Anyway, just wanted to give everyone a head’s up for these coming attractions.

Watch for the smoke – so you will really know “who done it.”

(Click the headline to leave comments.)

FBI – Official Request Made to Investigate Alleged Criminal Activity By Deer Ridge Manager And Board

Robert — Wed, 09 Dec 2009 17:01:33 +0000

Today, I officially filed the following complaint and request for criminal investigation with the FBI regarding Deer Ridge Mountain Resort and the GGRC HOA.

After the last “board” meeting, I, along with several other owners, are totally fed up with the board not providing copies of all books and records that we all deserve. Based on EVERY board members’ absolute resolve NOT to allow ANY copies of ANY books and records, I am now personally 100% convinced that Joey and the board are hiding criminal financial malfeasance to the detriment of all non-board Deer Ridge owners.

I have been involved in too many businesses in too many facets of real estate not to overwhelmingly sense, in my personal opinion, that we are all being criminally ripped off at Deer Ridge Mountain Resort.

No matter what the Master Deed says, a transparent and forthright board would provide these documents to the benefit of everyone! The fact they are ALL fighting tooth and nail to prevent the release of copies of ANY of these documents speaks volumes to me, personally, about criminal intent and fact.

The White Collar Crime Division of the FBI has begun criminally investigating HOA and their boards and managers across the country. For example, click HOA Investigation. There is a fast growing trend in this country to start treating HOA managers and board members as quasi-government officials – holding them to the same standards as public officials when it comes to major white collar crime, corruption, financial misappropriations, kickbacks, embezzlement, illegitimate board member compensation, securities fraud and other possible financial crimes.

If we can get the FBI interested and convinced enough to pursue these perceived problems with GGRC and RML, they will hopefully run a comprehensive forensic audit going back several years. And, when the FBI runs an audit, they can find stuff – no matter how much Joey may have had his computer guy from North Carolina try to hide any suspicious trail. My guess is that the FBI will want to talk to him, and a whole lot of other folks, at length if they pursue this investigation. And I doubt that any one is going to risk lying to the FBI to try to protect any potential guilty parties at Deer Ridge.

It may take the FBI 2-4 months to get to us, depending on how busy the White Collar Crime Division is in the Knoxville office (which has jurisdictional responsibility for Sevier County.) If you would like to file your own request for an FBI investigation of the shenanigans at Deer Ridge, you can do so online by clicking FBI Complaint. I would guess that the more of us who file a request for a criminal investigation, the more attention the case will get and the faster any investigation will commence. Also, please let me know if you would be willing to talk with the FBI about any investigation they may initiate.

I see this criminal investigation happening in addition to the civil lawsuit I am still pursuing.

Unless requested otherwise by the FBI, I will update this story on this Deer Ridge Owners blog as any investigation proceeds.

Then again, who knows? A half dozen black vans with two dozen FBI agents may just show up one day at the Deer Ridge offices, sweep in and confiscated everything. Just like on TV.

Stay tuned.

Suspected Crimes: White Collar Crime, Corruption, Financial Misappropriations, Kickbacks, Embezzlement, Illegitimate Board Member Compensation, Securities Fraud

Alleged Suspects: General Manager and Members of the Board of Directors of Gatlinburg Golf and Racquet Club, AKA Deer Ridge Mountain Resort, AKA Ridge Management LTD, Inc. et al.

Location: Gatlinburg, Sevier County, Tennessee – Knoxville Office of FBI

Federal Jurisdiction: Property owners in multiple states, board members domiciled in multiple states, units sold to buyers in multiple states as investments.

It is my understanding that the FBI’s White Collar Crime Division has begun investigating Home Owners Associations across the country and criminally prosecuting those board members and managers found to have been financially diverting HOA funds illegally for their own personal gain.

If so, I applaud this focus since nearly a quarter of all Americans now live under some sort of HOA Regime. These Regimes have become quasi-government entities like towns and cities – and their ruling boards of elected members should be held accountable under the same legal scrutiny as government officials when it comes to financial malfeasance.

Summary Background

I have been the owner of a condo at Deer Ridge Mountain Resort in Gatlinburg, Tennessee for the past four years. During that time I have constantly and continually requested copies of the books and records of our homeowners association and other associated operating companies. Likewise, many other owners have made the same request. I have even offered to bring my own copy machine to the main office and use my own time and equipment to make these copies.

Even as recently as four weeks ago, I and several other owners attended a board meeting. We all specifically requested copies of the books and records be made available. Every member of the board and the general manager, Joe Thomas, categorically refused to allow any owner to have copies of ANY requested books and records.

This same board is now attempting to force all owners to fund a $353,500 special assessment but very suspiciously refuses to provide ANY underlying documentation that supports the amount of the assessment other than four or five single line items. For example, one particularly suspicious line item on the special assessment is, “Nuts and Bolts — $50,000.” That’s a lot of nuts and bolts.

Official FBI Request

I am filing this official criminal investigation request with the FBI because I, and several other owners, believe the reasons that copies of the books and records are not made available to the owners is because the general managers and the board are attempting to conceal major white collar crime, corruption, financial misappropriations, kickbacks, embezzlement, illegitimate board member compensation, securities fraud and other possible financial crimes being committed by persons associated with the operation and management of Deer Ridge Mountain Resort.

To be clear, all of these allegations are currently unsubstantiated since we have been completely blocked by Joe Thomas and the board in all of our combined attempts to get copies of the needed books and records. However, the more adamantly resolved the general manager and the board are about providing owners with copies of all books and records, the more strongly indicative it is that they are fighting with all of their efforts to hide probable illegal activities from the very owners they are suppose to represent.

My background in real estate gives me particularly keen insights into the multiple signs of rampant malfeasance at this property. Before I retired, I personally spent three decades as CEO of multiple companies – including 15 years as founder and CEO of my own property management company managing 45,000 rental units. As a result of that experience, and the internal audits we had to constantly run on our own managers, my very strong intuition is that this board and general manager are attempting to hide major criminal activity in the possible aggregate range of $250,000 to $2 million.

The Alleged Suspects

The Board members include Luther Parker, President, Memphis, TN; Thomas Reise, Vice President, Friendship, WI; Larry Ohm, Treasurer; Grant Park, IL; David Barone, Secretary, Monroe, NY; Margie Duncan, Director, Florence, KY. Complete home addresses and phone numbers of these board members can be provided upon request.

The General Manager is Joseph W. Thomas whose home phone number and address are believed to be: (865) 932-1669 3229 Autumn Lane, Kodak, TN 37764. It is my personal belief that this long term manager may be the primary source of much of the alleged activity.

Request For Criminal Investigation

As a result, I and other concerned owners at Deer Ridge Mountain Resort, formally request that the FBI instigate a preliminary criminal investigation of Joe Thomas and the current members of the GGRC Board of Directors to determine if a comprehensive investigation and criminal charges should be pursued against these individuals.

With the Board’s demand that all owners now contribute half of the $353,500 special assessment prior to March 1, 2010, many of us fear is that these monies also will be immediately misappropriated. As a consequence, your quick investigation would be appreciated. We are going to pursue civil litigation on many other issues but are concerned that the civil courts will not respond in a timely enough manner to prevent major misappropriation of the special assessment funds.

You have my complete contact information on this form. Please contact me directly if you have any questions or need more information from me or other concerned owners. You might find my blog about these issues informative: www.DeerRidgeOwners.com. Various documents and comments from multiple owners can be viewed there.

Thank you for your consideration of this criminal investigation.

As I mentioned, nothing has happened yet. I just filed this request for a criminal investigation today.

It is just a request and there is no known currently active criminal investigation with regard to Joe Thomas or any board member. The FBI may decide there is insufficient information. They may decide that I and my strong intuition are completely wrong – and that everything and everyone involved with the management of Deer Ridge is legitimately doing everything right – properly crossing every T and dotting every I.

I don’t think so – but hopefully, the FBI will help us even come to those conclusions as a result of any investigation they might initiate.

Stay tuned. We live in interesting times.

Six Weeks Old – Some Blog Statistics – And A Legal Update

Robert — Tue, 03 Nov 2009 03:52:34 +0000

Some Blog Statistics

I started this Deer Ridge Owners Blog about six weeks ago.

During that time, we have had:

38 posts with 82 comments, six pages and 20 different categories. (I am getting a LOT of other, mostly encouraging, email from owners and others who support our cause – but who prefer, currently, to remain anonymous.)
We have had 1,089 unique visitors, looking at 7,216 page views – that is a huge number of visitors for a small 84 unit condo – and a huge average number of pages viewed per visitor (6.63 pages per visitor) – so the visitors who come, read what has been written.
3,031 Internet spider visits – this is a separate count for all the times Google , Yahoo, etc, come visit and re-index the updates here. As a consequence, we are showing up very high on a lot of Google searches for Deer Ridge, Gatlinburg this or that, including rentals, condos for sale, etc.
We have had 824 RSS feeds – so a lot of folks want to automatically see every word that shows up on DeerRidgeOwners.com.
The metrics target for the blog this month, November 2009, is for us to have 1,200 unique visitors just this month – so apparently we are ramping up fast in traffic.
We apparently have a LOT of local real estate brokers watching – as well as other HOA members – both locally and from all over the country – wanting to see the outcome of our legal actions we are taking against the GGRC and Ridge Management boards – and all of the board members and Joe Thomas individually.
Apparently, a lot of other web sites and blogs that are focused on bad HOA management and board members are adding links to DeerRidgeOwners.com. (Note: you are welcome to include links to this blog if you have your own blog or website fighting your own HOA.)
We have heard that several local real estate brokers in the Gatlinburg area are recommending that their clients NOT buy at Deer Ridge UNTIL these major issues raised on this Deer Ridge Owners Blog are finally resolved. Several brokers have mentioned that if our lawsuits are successful, that the impact will probably be a HUGE increase in market value for many of the units here.

Here’s a screen grab of the stats:

Legal Update

Quick update…still interviewing attorneys…and biz is booming so been swamped with work that pays the bills…and all this lawsuit stuff is very time consuming…but still a life priority for me to get this suit in place ASAP. Class action will still be eventual best approach due to nature of all of our claims….but class action seems too complicated for a lot of small law firms…and apparently takes a while to set up….so, will be filing a smaller, individualized suit to start with….on the most basic points.

Right now, I am most interested in getting a quick court ruling on the following basic points to get the Board and Joey under control. I may even still end up doing these as one or more small claims actions just to get the ball rolling.

Once the precedents are set with rulings on the below points, LOTS of derivative lawsuits can be IMMEDIATELY brought forward…

Minimized Litigation Points To Keep Costs Low And Expedite Ruling – The First Five Points

Decision by the Court that Article V of the Master Deed in no way gives the Board and/or the General Manager the right to circumvent or trump the other provisions of the Master Deed and/or Bylaws and does not give the Board and/or the General Manager carte blanche to bypass the vote and opinions of the owners of Deer Ridge Mountain Resort.
That the Board must ALWAYS use complete and constant applicability of the Master Deed Percentages to EVERY cost, monthly fee, assessment, etc. for all units at Deer Ridge.
Recovery of my personal $10,000 plus overcharge by the Board not following the Master Deed Percentages along with interest at the highest legal rate, at least treble damages, court costs and legal fees plus additional, other full reimbursements and/or damages for all other wrongdoings committed by Joe Thomas and/or the Board.
Decision by the Court that the formation and operation of Ridge Management Limited, AKA RML, is not, in any way, a Common Expense, for GGRC as defined by the Master Deed and Bylaws and, as a consequence, any and all costs, fees, charges and assessments related to the formation and operation of RML were wrongly allocated to the past and current owners of units at Deer Ridge.
That the Board and Joe Thomas, or his replacement, are required to provide all owners with copies of any and all books and records related in any way to the ownership and operation of GGRC, RML and or the operations of the Common Property.

Other Tack On Points To First Lawsuit Claims Subject To Cost and Time – The Second Five Points

That secure, individualized mailboxes be installed for all owners as a Common Expense so that mail tampering can be minimized and have the property meet US postal code requirements for individualized mail delivery for multi-family residential developments.
That the Board be required to allow last minute attendance by any and all owners to all meetings related in any way to Deer Ridge Mountain Resort and for time set aside for attendees participation and comments.
That the Board be required to digitally audio record all parts of any and all meetings in any way related to GGRC and/or related entities in a legible manner and for those recordings to be made available online to all owners.
That the current special assessment for $353,500 be quashed until such time as the true and correct evaluation of the financial status of GGRC is settled and established by this lawsuit.
That the Board be required to offer any and all services, use of personnel and maintenance staff, etc. on an equal basis to all owners without discrimination of any kind.

I believe if the first set of lawsuits are strictly limited to these above issues, that it should not be very complicated at all to try this case – just have the judge or jury decide the proper interpretation of the existing documents.

After The First Win…

Once we get a clear ruling on the REAL meanings of our existing documents, then Joey’s and the Board’s house of cards will quickly collapse on everything else.

And, once we all have access to ALL the books and records on OUR property, we can then quickly discover what financial shenanigans have REALLY been going on at Deer Ridge – and what, if any, fraud and criminal misappropriations and / or embezzlement may or may not have been stealing OUR money from the Deer Ridge accounts.

If you would like to help with the legal fees to finally get Joey and the Board under control – and help all owners finally take back control of Deer Ridge, I invite you to click on the DONATE button in the RIGHT column of this blog.

Well, that’s the current game plan….stay tuned. We live in VERY interesting times.

PS: On Suing Ourselves

A few owners have voiced some concerns about me suing err ME when I sue GGRC – and where will the money come from if I, and the other 1-1 owners, win?

Well, I have personally been grossly overcharged more than TEN THOUSAND DOLLARS – and I want my money back. The thing is, virtually EVERY 1-1 owner has been similarly grossly overcharged – and my guess is that they want THEIR money back, too. Fair is fair.

For me, the natural place to get this money – and even the money for the rehab of Deer Ridge that REALLY needs to be spent – can all be covered from found money – the money GGRC should receive from the arm’s length sale of RML to another property management company – once GGRC is forced to sell it from the above court actions. I have experience selling my own, much larger property management company, so I know the right way to do this – and how to maximize the proceeds from a sale of RML – for the benefit of GGRC and all owners.

The other pockets I fully expect to get my money back from are those belonging to the individuals who are our board members and Joe Thomas, General Manager. If we show in court that they are either fraudulent AND / OR grossly negligent – then they are not protected and can be individually sued – with judgments against them that can be collected on.

So, I don’t see it as suing ourselves at all – but suing those individuals who have tried their best to subvert the governing documents that define the way things SHOULD be done at Deer Ridge Mountain Resort in Gatlinburg, Tennessee.

RML Is Illegal! Pavilion Is Illegal! April Annual Meetings Are Illegal! More Major Flagrant Master Deed Violations

Robert — Wed, 07 Oct 2009 17:53:58 +0000

***** Major News Flash! ***** ***** Major News Flash! ***** ***** Major News Flash! *****

Yep….I am still having a good old time plowing through the Master Deed and Bylaws of Deer Ridge Mountain Resort (AKA GGRC and RML.) Such fun! But I have found THREE more pivotal, and ongoing violations of the Deer Ridge documents as a result of the actions, and in-actions, of GGRC and RML Board of Directors and the General Manager, Joe Thomas.

These are critically important violations that all owners at Deer Ridge need to understand – so this is worth your time. In my opinion, the following will show you that:

Annual meetings and board of directors elections have violated the requirements of the Bylaws of GGRC.
The construction of the pavilion was a violation of the Master Deed for Deer Ridge.
The starting and continued funding of Ridge Management, AKA RML, was and is an ongoing violation of the Master Deed for Deer Ridge

These violations add up to hundreds of thousands of wrongly spent dollars – and don’t even include what appears to be over HALF A MILLION DOLLARS of wrongly applied monthly HOA fees and special assessments against owners.

We are talking about a lot of YOUR money having been misused – requiring you to fund even MORE dollars for your “share” of the current Asinine Assessment. So, the following is worth your time to read.

As before I am going to see if I can make this simple with little snippets I took from the Master Deed and Bylaws. You can download the whole document here on this blog by clicking Master Deed and Bylaws.

Now…to understand this post, you really ought to read the prior post “Deer Ridge – Your Monthly HOA Fee And Special Assessment Are WRONG!” If you click that title, you can go read the post that shows that ALL of the monthly HOA fees and special assessments have been wrongly calculated for YEARS!

Go read it and come up to speed on that before we move forward with today’s topic. I’ll wait….

……………………………………………………………..

Back so soon? Good, this means you’ve been keeping up on your homework!

As I mention there, I am plowing through these two controlling Deer Ridge documents because of my contemplated lawsuit against Deer Ridge Mountain Resort, AKA GGRC and RML, for not providing copies of documents to any and all owners.

Because of this, I started looking at different things – and figured I needed to go back and re-read the Master Deed and the Bylaws that are the governing legal documents for Deer Ridge.

Violation – Annual Meetings

We’ve owned here at Deer Ridge for over four years and love it here! During those four years, and I believe for many years before that, the annual homeowners association meeting has been held during the last part of April each year.

It’s a pretty time of the year – and seems to work well with all the golfers who are purposely distracted by the GGRC golf tournament. After all, if the Board and Joe Thomas can use golf tournaments and dinners to divert attention from the real business issues that genuinely need attention, they can better continue their flagrant Master Deed violations.

The trouble with having the annual meeting every year in April? The Article XI of the Bylaws REQUIRES it be held before the end of March!

Notice that this says the annual meeting is to be held during the first quarter of the calendar years…that means that it MUST be held before the end of March. Period.

Now, there IS a way to change this – via Article XX of the Bylaws, Amendments.

Based on my understanding of the Deed Records of Sevier County, there has never been an official amendment to the Bylaws, with at least 67% of the owners approving such amendment, to ever change the requirement to have the annual meeting before the end of March. Note that it REQUIRES that ANY amendment be embodied in a recorded instrument on the Deed Records before it becomes “operative.”

Hence, I will contend during the lawsuit that since becoming an owner, there has not been ANY annual board meetings held in accordance with the Bylaws – and therefore there has not been any valid election of Board members during that time – and any decisions, assessments, etc. made by the illegally formed Board are null and void and without effect.

Again, this is just another example of the Board’s and Joe Thomas’ clear disregard of the Master Deed which is the controlling document for everything that is supposed to happen at Deer Ridge. They can’t just choose to play by the required rules just whenever they want. They are REQUIRED to follow the rules ALL of the time. Period.

The Board and/or Joe are grossly negligent in not abiding by even this simple requirement of the Master Deed and are jeopardizing GGRC to claims of ineffective decision making.

Violation – Joe’s Folly – The Totally ILLEGAL Pavilion

If you have read my other post here on Joe’s Folly Pavilion then you will know what a horrible business decision it was to move forward with that new facility – especially when they had a comprehensive business plan showing them it was an idiotic idea before they started construction.

You got to hand it to Employee Joe – when he gets his mind set on something, he gets it done – one way or another – whether it is legitimate or not – whether it is idiotic or not! As they say here in Tennessee, “Git ‘er done!” (I was born and raised here, so I can poke fun at us locals!)

Or, as Joey and the Board sing, “Git ‘er done – no matter what the Master Deed says!” (The tune is the same as Elton John’s, “Bennie and the Jets.”)

What is interesting is that the Board reported in the Board meeting notes that the pavilion project was canceled – but lo, and behold, just a few months later Joe had his Folly Pavilion anyway.

No vote. No discussion. Joe wanted it – and somehow he got it.

Problem is: Once again they broke the rules to do it – completely ignoring the requirement of the controlling documents of our property. This is what the Master Deed requires, according to Article XII:

As you can see, this part is crystal clear: NO alterations or additions to the Common Elements without a 75% affirmative vote of the total vote by all the Owners.

Did you get a vote? I didn’t either. So, over $80,000 of OUR money appears to have been spent illegally by the Board and Employee Joe. In court, I will demand that they show this was an authorized expense. Of course, since there was NEVER a vote, they won’t be able to prove that it was legitimate.

And, that is not the only alterations or additions that have been completed at Deer Ridge.

I didn’t get a vote on the current changes and additions to the maintenance building.
I didn’t get a vote on the changes to the pool deck, whirlpool or the new siding for the walls surrounding the pool.
I didn’t get a vote on the major renovations that were spent on jazzing up the reception area and Joey’s offices.
I didn’t get a vote in ALL the other alterations or additions that have occurred at Deer Ridge.

Did you?

The other part of the above snippet says that if something IS approved, only those who benefit from it have to pay for it. The whole touted reason for building the pavilion albatross was to encourage more reunion groups renting more rental units. Well, I am not part of RML and get ZERO benefit and only grief from it, so NONE of my assessments should have been used to pay for anything whatsoever to do with Joe’s Folly – even if it HAD been legally approved.

The trouble is that ALL of us had to pay for this stupid idea of Joe’s. Even though it was illegal without that 75% vote.

Which is why I want a full, comprehensive cost accounting audit of everything associated with Joe’s Folly Pavilion done by an unaffiliated third party forensic CPA firm. And, one of many reasons, I want Joe Thomas fired – for at least gross incompetence and gross negligence.

Without that 75% vote, the Board violated the requirements of the Master Deed. Without that 75% vote, they, and Joe Thomas, either fraudulently or through gross negligence, wasted my money and yours by constructing this pavilion.

If they didn’t know about or understand the constraints of Article XII, then they are grossly negligent. If they DID know, I consider it fraud if they spent my money knowing they did not have a right to spend it!

Either way, I plan on including this issue in my lawsuit against GGRC and RML.

I want my money back that was stolen from me – plus at least treble damages!

Violation – Ridge Management – RML – It’s Formation and Operation Are Violations Of The Master Deed

Ahh, good old Ridge Management. The bane of Deer Ridge and the never ending abyss into which all owners pour money.

Too bad it is is ILLEGAL!

Let me show you my logic again…by using the controlling document for everything that happens regarding Deer Ridge – the Master Deed.

According to Article IX of The Master Deed – Assessments: these are the ONLY legitimate reasons that owners can be charged assessments for their unit at Deer Ridge.

Note that the Common Expenses ONLY include what is “necessary for the care, repair, replacement, maintenance, preservation and improvement of the Submitted Property and shall establish and maintain a adequate reserve fund to cover these periodic expenses.”

Now, it goes on to say,

The Board of Directors shall have the power and duty to fix and determine from time to time the sum or sums necessary and adequate to provide for the Common Expenses of the Regime and such other expenses as are provided for herein, in the Act or deemed necessary and appropriate expenses of the Regime.

What that means is that the Board can decide the right amounts for the Common Expenses and charge that to all owners in accordance with the Master Deed Percentages – but they CANNOT go off and set up an operating business and charge owners for funds to operate that business!!!

Hence, Ridge Management, AKA RML is illegally formed and funded with your assessment dollars!

All owners do NOT benefit from RML (actually, my contention is that no Deer Ridge owners benefit from RML) – so Joe Thomas and the Board, through either gross negligence and/or fraud, have funded RML through illegal assessments to all owners of Deer Ridge. Additionally, it is my contention that the full extent of this illegal funding to RML has been intentionally hidden in the budgets submitted by Joe Thomas and the Board – and those fraudulent budgets are the budgets shown to all owners.

When I bought my property at Deer Ridge, it was with the idea and knowledge that I was making a real estate investment – with all of the potential risks and rewards that are a normal part of real estate.

However, as a result of the Board and Joe Thomas knowingly and, in my opinion, illegally starting and funding RML, I and all other past and current owners at Deer Ridge have been FORCED to participate in the business risks of an operating business. In this case, it is for a property management company that does NOT benefit all owners.

What if….. Joey and the Board had this totally “fictitious” brainstorming session over drinks one night,

“Hmmm…the Pavilion hasn’t turned out to be such a good idea, after all.

“Oh, well. It was only $80,000 – and it wasn’t MY money we were playing with! Just more Monopoly money from the owners.

“I know! Let’s turn this pavilion into a restaurant and call it ‘Joe’s Folly Food and Fun.’ Why, it would be good for all the owners because that way there would be an on premises restaurant – and the owners and guests wouldn’t have to even leave Deer Ridge to have a tasty meal. And, if there were any owners who didn’t use our new restaurant, or use it ENOUGH – well, they would just be traitors and be downright unAmerican – stealing money from Deer Ridge!

“Hmmm…maybe we could even charge owners a penalty for each and every meal they cooked in their kitchen instead of eating at our restaurant.

“Hmmm…that might not fly….

“Owners…who do they think they are? They think they own the place! Don’t they understand I have a business empire to run here!

“I know, just charge the owners during Primetime Season – and every time there is a full moon. Owners shouldn’t even be here during Primetime Season any way – this will show them.

“Hey, and I can sneak on a Restaurant Usage Opportunity Fee to all the guests who rent here – and surprise them with that like we do the surprise Maid Fee when they check out. I just love to watch the expression on guests’ faces when they get to that line item – and we show them we have a right to do it with the tiny print on the web site.

“The owners certainly don’t need to vote on this restaurant – it is obvious to God, and everyone, that this is good for all owners – plus it’s good for the economy and good for America – and, besides, the finished restaurant would be such a nice surprise to everyone next time they show up on property. Besides none of them are smart enough to read the Master Deed to know what can and cannot be done.

“Now, let’s see….I will need about $250,000 to turn this turkey errr pavilion into a restaurant…..I will need to add A/C, furniture and fixtures, kitchen equipment, signage – we gotta have some signage. And, I should get paid, hmm….a $50,000 bonus for coming up with such a GREAT idea for Deer Ridge Mountain Resort!

“Plus, I deserve ANOTHER monthly salary, oh say, $5,000 a month as Restaurant Manager…on top of my other monthly salaries from being GGRC Manager, RML Manager and Ridge Realty Manager….after all, condo sales are down – and I got to make up the money somehow…

“Better make that total $350,000 for the new restaurant – what’s an extra hundred grand among friends – especially when all we have to do is add all of this to the monthly HOA fees or maybe even do a special assessment for every owner at Deer Ridge. Besides, all the owners are loaded – and can afford whatever amount I think is needed.

“Oops, if we do that, hmmm…instead, let’s call it $350,000 for ‘nuts and bolts’ for the main property. And it won’t matter if the restaurant makes money or loses money. We’ll just keep funding it from all the Deer Ridge homeowners – one way or another!” After all, it is good for the property – and good for all of America.

“God bless America! Praise the Lord – and pass the plate!”

Of course, all of the above is just a little satirical humor – and has nothing to do with any reality I personally know about.

However, the point is: Whether it is a restaurant – a grocery store – or a property management company, anything like that puts ALL the owners of Deer Ridge at major risk – for all the things that can go wrong with running ANY business.

When I bought at Deer Ridge, I was NOT buying into some operating business – and this ongoing obligation to fund RML through HOA Fees and special assessments was NOT disclosed.

The trouble is that ALL of us have had to pay for this stupid idea of being in the property management business. Even though it sure appears illegal to me. Which is why I want a full, comprehensive cost accounting audit of everything associated with Ridge Management done by an unaffiliated third party forensic CPA firm.

I also want RML sold ASAP – not to Insider Joey who tried to steal it before with a $100,000 purchase price with $90,000 of the price as a non-recourse note from Joe Thomas back to GGRC – but a sale done right -in accordance with the methodology I described before. Click RML Sale for details.

The Board violated the requirements of the Master Deed. Any funds related to starting and operating RML are NOT part of the definition of “Common Expense” in the Master Deed. ONLY those items defined as Common Expense can be part of the allocations requiring payment by the owners of Deer Ridge. Period.

The Board, and Joe Thomas, either fraudulently or through gross negligence, wasted my money and yours by putting us all at risk of running a business called Ridge Management.

If they didn’t know about or understand the constraints of Article XII, then they are grossly negligent. If they DID know and still went ahead and started and ran RML, I consider it fraud if they spent my money knowing they did not have a right to spend it!

Now that they DO know for certain that it is NOT an appropriate use of even one dollar of our money, the Board and Joe Thomas are required to stop all operations immediately – and dispose of RML forthwith. In my opinion, for them to continue operating RML beyond today would clearly be fraudulent behavior.

Either way, I plan on including this issue in my lawsuit against GGRC and RML.

I want my money back that was stolen from me – plus at least treble damages!

Upshot – Without These Master Deed Violations – GGRC Would Have More $$$ And Not Require The Current Special Assessment

Have you all started noticing an ongoing pattern here – where Joey and the Board have TOTAL disregard for the rules for Deer Ridge?

Gross overcharges and undercharges of all HOA costs, fees and assessment by unit type, not in conformance with Master Deed.
Annual meetings not in conformance with Bylaws.
Major repairs and construction done, not in conformance with Master Deed.
RML formed and funded, not in conformance with Master Deed.
What else? We will see what we can add to this list – besides Joey and the Board doing everything they can to block access to the books and records of OUR homeowners association.
What else are they trying to hide???

The Board and Joey right now want all of us to give them $353,500 for what they say are needed repairs – including $50,000 for “nuts and bolts.” And, they are completely unwilling to show owners ANY of the underlying documents to justify their $353,500!

Suspicious, huh?

Kind of reminds me of the $20 million commode seat that was a very infamous line item in the military budget a few years ago. Just like that seat, the $353,500 assessment is NOT for what Luther’s letter describes. It is to fund projects and companies like the pavilion and RML – and to hide the real purpose from the owners of Deer Ridge.

If our money had not already been squandered by Joey and the Board, our reserve account would be sufficient to pay for the work that really needs to be done on this property – and all of us would NOT have a $353,500 special assessment staring us in the face.

More Coming On This Post – Stay Tuned And Watch For The Updates!

The $1000 Assessment – ANOTHER Grossly Negligent Or Fraudulent Charge By Joe Thomas and The Deer Ridge Board?

Robert — Mon, 05 Oct 2009 16:01:19 +0000

Just did a quickie analysis on the $1,000 across the board assessment done by the Board a few years ago.

As you can see, the Board was either grossly negligent OR fraudulent in charging ALL owners the same amount for that assessment – instead of applying the REQUIRED Master Deed Percentages:

$ 1,000.00	Assessment
84	Total Units
$ 84,000.00	Total Raised

Unit Type	Proper Percentage	Proper Assessment
1BR	0.0061	$ 512.40
IBRL	0.0130	$ 1,092.00
2BR	0.0130	$ 1,092.00
2BRL	0.0195	$ 1,638.00
Commercial	0.0195	$ 1,638.00

As you can see, I and 29 OTHER owners were charged almost DOUBLE what we should have been charged on this particular assessment – with clear disregard for the provisions of the Bylaws and Master Deed of Deer Ridge Mountain Resort.

36% of ALL Owners Overcharged a total of $14,628 – Just on this one item!

I don’t know about you – but I want my money back TODAY! Along with interest at the highest legal limit, at least treble damages, etc.

What else is going on at Deer Ridge that is so WRONG – that Joey and the Board are blocking access to books and records by all the owners?

How much more gross incompetence, gross negligence and / or fraud does the current Board of Directors need to see before firing, with cause, the General Manager of Deer Ridge, Joe Thomas?

PS: The above “mistake” on the $1,000 per unit assessment from a few years ago is just a “taste test” of a much broader analysis and posting I am working on – if you liked the last major news on my blog, please stay tuned for another major news announcement in the next couple of days of even more, SIGNIFICANT, problems that are also, in my opinion, EITHER fraudulent behavior and / or gross negligence by Joe Thomas and / or the Board of Directors of Deer Ridge.

Upcoming Mailing To All Deer Ridge Mountain Resort Owners

Robert — Sun, 04 Oct 2009 17:28:09 +0000

I have special postcards on order right now that will be mailed to all owners at Deer Ridge.

The goal is to let all owners know about the new Deer Ridge Owners Blog – so they can know what is going on with their property, participate in the online discussions and get to know their co-owners.

You can see the front of the post card below. The back side of the card, well let’s just say, that part is still a secret! Watch your mailbox!

They will also find out about the current investigation that has already uncovered over HALF A MILLION DOLLARS that appears to have been misappropriated from some owners – possibly fraudulently or through gross negligence!

As of today, Luther Parker, President of your Board of Directors and Employee Joe Thomas are still attempting to stonewall the investigation. Part of their “obstruction of justice” is to refuse to provide me with the current mailing labels for all owners.

I have the mailing label information from a couple of years ago – which I will use if I don’t get the current set. I got my current set when I threatened legal action over this issue three years ago. Apparently, their attorney told them then that they did not have a choice – so they capitulated and provided a copy of mailing labels to any owner who requested them.

Now, they have regressed back to their prior stand.

Since they know what the attorney told them before – and they are now refusing to provide this information – kind of makes me wonder if they are SO scared their shenanigans will now be uncovered by the investigation, that they are willing to take their lumps over blocking access to the mailing list – because the alternative is even worse consequences to SOMEBODY or SOMEBODIES.

They sure seem scared about something seeing the light of day, huh?

If anyone has a more current list, please let me know.

Also, I know several other owners are planning on mailings to all the owners too – especially about the current Asinine Assessment. So, if I am successful getting the updated mailing labels from Luther Parker and Joey, I will make them available myself to any and all other owners who want them.

Deer Ridge Owners - Deer Ridge Mountain Resort - Gatlinburg, Tennessee » fraud

Tennessee Consumer Affairs Complaint Filed Against Joe Thomas – Attorney General Action Requested

Tennessee Real Estate Commission Complaint Filed Against Broker Joe Thomas – License 281040

Complaint: Deceptive Trade Practices, Securities Fraud And More Against Tennessee Real Estate Broker Joseph Thomas – Tennessee License 281040

Summary

Specific Complaints Against Joe Thomas

Investigator Assigned In Deer Ridge Securities Fraud Complaint

Securities Fraud Complaint Filed Against RML, Luther Parker, CPA Larry Ohm, Joe Thomas And All Board Members

Investor Complaint For Securities Fraud And Other Securities Law Violations Filed Against Ridge Management LTD, Inc. and President Luther Parker, Treasurer Larry Ohm CPA, General Manager Joe Thomas, Vice President Tom Reise, Secretary David Barone and Director Margie Duncan

Summary

Investor Complaints

King of All Vegas Real Estate Scams – From Bloomberg Businessweek

Independent Legal Opinion: GGRC Board Guilty Of Numerous Violations / $353,500 Assessment Is Null And Void

Deer Ridge History – Historical Documents And Smoking Guns – Coming Soon

FBI – Official Request Made to Investigate Alleged Criminal Activity By Deer Ridge Manager And Board

Six Weeks Old – Some Blog Statistics – And A Legal Update

RML Is Illegal! Pavilion Is Illegal! April Annual Meetings Are Illegal! More Major Flagrant Master Deed Violations

The $1000 Assessment – ANOTHER Grossly Negligent Or Fraudulent Charge By Joe Thomas and The Deer Ridge Board?

Upcoming Mailing To All Deer Ridge Mountain Resort Owners

Complaint: Deceptive Trade Practices, Securities Fraud And More Against Tennessee Real Estate Broker
Joseph Thomas – Tennessee License 281040

Investor Complaint For Securities Fraud And Other Securities Law Violations Filed Against Ridge Management LTD, Inc.
and
President Luther Parker, Treasurer Larry Ohm CPA, General Manager Joe Thomas, Vice President Tom Reise, Secretary David Barone and Director Margie Duncan