Real Estate

Attorney Scott Rothstein Arrested in $1.2 Billion Ponzi Scheme

Scott Rothstein in his office
Scott Rothstein in his office

How many Ponzi schemes can there be? I don’t know, but it seems like every day another one is discovered.  Here’s one in Fort Lauderdale, Florida, where attorney Scott Rothstein’s suspected  Ponzi scheme  may have taken  $1.2 billion from investors. One investor  calls it a “tragedy” who says he is at risk for tens of millions of dollars. The scandal has sent lawyers, investors, and politicians alike in a tizzy while investigators are scrambling to learn exactly how much money has been lost.

Rothstein, a partner of the law firm Rothstein Rosefeldt and Adler, is suspected of running a covert investment scheme on the side and may have walked away with “substantial sums” put up by investors, according to a lawsuit brought by his partner, Stuart Rosenfeldt.

In what federal authorities say is the biggest fraud case in South Florida history, the 47-year-old faces five counts of racketeering and fraud related to his alleged scheme. Prosecutors say Rothstein ran the scheme out of the 70-lawyer Fort Lauderdale law firm where he was CEO, swindling his own friends and clients. He allegedly forged federal court documents, including judges’ signatures to make his investors believe the settlements they were buying into were legitimate

He once graced the society pages of local newspapers and gave big to Florida politicians, but on Tuesday, Fort Lauderdale attorney Scott Rothstein was arrested on federal fraud charges, accused of running a $1.2 billion mini-Madoff Ponzi scheme. If convicted, he could be sentenced to up to 100 years in prison. How did he spend all that money? Well, the fed’s grabbed $60 million of his toys, including  20 luxury cars, 15 real-estate properties, an 87-foot yacht, 304 pieces of jewelry and $12 million stashed in Moroccan banks

Click HERE to read the federal charges against Rothstein.

Source: ABC News

Real Estate

Why Not Walk Away From My House?

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I wrote earlier that we should not walk away from your house if you are upside down on your mortgage. I’ve changed my mind. If you lost your job or had a great reduction in income for whatever reason, the banks don’t seem to care. I’ve read and seen were they’ll stall until you have used up your savings, made the very last payment you can and than foreclose on your home. 

 Here’s a portion of a great article on the subject of walking away from your home that appeared in the SF Chronicle:

“Go ahead. Break the chains. Stop paying on your mortgage if you owe more than the house is worth. And most important: Don’t feel guilty about it. Don’t think you’re doing something morally wrong.

That’s the incendiary core message of a new academic paper by Brent T. White, a University of Arizona law school professor, titled “Underwater and Not Walking Away: Shame, Fear and the Social Management of the Housing Crisis.”

White argues that far more of the estimated 15 million American homeowners who are underwater on their mortgages should stiff their lenders and take a hike.

Doing so, he suggests, could save some of them hundreds of thousands of dollars that they “have no reasonable prospect of recouping” in the years ahead. Plus the penalties are nowhere near as painful or long-lasting as they might assume.

“Homeowners should be walking away in droves,” according to White. “But they aren’t. And it’s not because the financial costs of foreclosure outweigh the benefits.” Sure, credit scores get whacked when you walk away, he acknowledges. But as long as you stay current with other creditors, “one can have a good credit rating again – meaning above 660 – within two years after a foreclosure.” 

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“How does White’s 52-page manifesto go over with mortgage lenders? Predictably, not well. Officials at Fannie Mae and Freddie Mac – investors who fund the bulk of all new mortgages in the country – disputed White’s characterization of how quickly after foreclosure a walkaway borrower can obtain a new loan. It’s not three years, they said, it’s a minimum of five years, absent extenuating circumstances such as medical or employment problems that caused the foreclosure.”

Remember, before you walk away from your home, check with your accountant and or a tax attorney.

This is a great article, read the rest at San Francisco Gate

So what do you think readers?

Construction, Real Estate

It Pays to Build Green

green building

By Tina Perinotto

Here comes more proof that green buildings make sense – dollars and sense in fact. This time a study by the University of San Diego and CB Richard Ellis Group, found that tenants in green buildings experience increased productivity and fewer sick days, and that green buildings have lower vacancy and higher rental rates.

On the financial front in terms of rents and sales values, that’s exactly what Nils Kok, a professor at the University of Berkley, California and at Maastricht University in The Netherlands, found and presented to the Australian Property Institute and Australian Direct Property Investment Association, with his study, Doing Well By Doing Good. Energy efficient buildings were worth 17 to 18 per cent more than inefficient building and they earned 6 per cent more in effective rents, he said. [See our report http://www.thefifthestate.com.au/archives/7633]

Now preliminary findings from the latest report, Do Green Buildings Make Dollars and Sense? overseen by Dr Norm Miller, academic director and professor at the University of San Diego’s Burnham-Moores Center for Real Estate, in collaboration with CBRE’s national director of sustainability, Dave Pogue, and Ray Wong, CBRE’s director of Americas research, has found that green buildings are more productive.

According to the research, which will be published later this year, green buildings are more productive on two measures:

The average number of tenant sick days and the self-reported productivity change. “Respondents reported an average of 2.88 fewer sick days in their current green office versus their previous non-green office, and about 55 per cent of respondents indicated that employee productivity had improved,” the report said.

This equated to a net impact of nearly $53.82 a sq m [$5.00 a sq ft] occupied, and the increase in productivity translated into a net impact of about $215.28 a sq m [$20 a sq ft] occupied, based on the average tenant salary, an office space of 23.23 square metres [250 square feet] per worker and 250 workdays a year.

“The study additionally showed that green buildings have 3.5 per cent lower vacancy rates and 13 per cent higher rental rates than the market,” CBRE’s Dave Pogue said.

“The results of this project are beginning to demonstrate the very real and positive impact of sustainable buildings for both our owners and tenant occupants. We have been seeking ways to make an empirical case for the economic benefits of sustainable practices and the results of this study exceeded our expectations,” he continued.

Mr Pogue said the research involved a survey of 154 buildings under CBRE’s management, totalling more than 5.35 million sq m of (51.6 million sq ft) and housing 3000 tenants in 10 markets across the US.

“The study defined a green building as those with LEED certification at any level or those that bear the EPA ENERGY STAR ® label. All of the ENERGY STAR ® buildings in the survey group had been awarded that label since 2008. Most of the buildings included in the research had also adopted other sustainable practices like recycling, green cleaning and water conservation.”

Dr Miller said: “This is an exciting time for the commercial real estate industry where great values and great investment upgrade opportunities coexist.  This window won’t last forever.

“We have now confirmed in this and other studies that green features and energy savings pays off.  Tenants care about healthy energy efficient buildings. We also know that green leases and managing to a new and higher standard will soon become the norm. Commercial real estate players have no choice but to learn how to be better in a sustainable way. We know the economics of green will drive the market, not altruism or concern about global warming,”

The  report also said:

  • 18 per of tenants are willing to pay more for green space
  • 61 per cent of tenants believe healthy indoor environments positively impact staff retention
  • 70 per cent believe it impacts positively on client image
  • 71 per cent felt that green lease provisions are increasingly important
  • Each additional point of ENERGY STAR ® rating saved 0.8-1.0 per cent in electricity
  • Separate metering yielded a 21 per cent energy savings, more than any other factor.

These findings are generally consistent with other research on this topic, which has determined buildings with the ENERGY STAR ® label, LEED certification or other identified sustainable programs generally perform better.

The Fifth Estate – sustainable property news

Bits & Pieces

Bits & Pieces Nevada and Sierra County

Bridge to Court House and the gallows
Bridge to Court House and the gallows

November 28, 2009

I was in Downieville last weekend.  Seems like the place is shutting down, at least the restaurants are. In Sierra City the Red Moose closed during the summer and we were there for the last meal at the Buckhorn. Seems like the Buckhorn is closing for the winter.  In Downieville, the Wooden Trout went bankrupt and is closed.  So if you want a meal at night you are out of luck. All that’s open is a pizza place called the Gallows and a little restaurant in the local  grocery store. By the way, the restaurant makes great sandwiches.  Oh, there is only one grocery store, so you don’t have to worry about which one has the place to eat.

Not much happened this week, first the grocery stores were so busy you had a long line at the cash register with everyone buying food for Thanksgiving and then with black Friday there were long lines at the department stores. Wal-Mart stayed open 24 hours, JC Penny’s opened at 4 or 5 in the morning and I slept until nine.  The heck with going to the store at 5 am, I can spend my money at a decent hour.

Scotts Flat Lake continues to drop, waiting for the upper lakes that feed it to fill up. With the way the winter is going so far, it doesn’t look too good. You can argue if we have global warming or not, but you can’t argue with the fact that we’ve had some mighty dry years lately. The last thing we need is another dry winter. Interesting that people don’t want any more dams to store water and create hydro-electric power, but they want drinking water and clean energy, doesn’t compute, does it?

Single lane bridge on Hwy 49, newly painted
Single lane bridge on Hwy 49, newly painted

Oh, here’s a picture of the newly painted bridge in Downieville. I understand it took six weeks to paint the bridge. They had to completely enclosed the bridge so when they sandblasted the old paint none of the debris would fall into the river. The natives are happy that the bridge is open again. The detour was a real pain going through the narrow winding streets of Downieville.   By the way, did you know that Downieville missed being the state capitol of California by 10 votes? Hopefully this adds your trivia facts in case you ever get into a trivia contest.

Have a great holiday season.

John O’Dell

Local Writers & Contributors, nevada county fair

Nevada County Fairgrounds, Hope in Nevada County Team Up at the Country Christmas Faire

Tall_Pines_Ornaments

Donate a can of food on Sunday, November 29, and receive $1 off admission

The Nevada County Fairgrounds and HOPE (Help Other People Eat) in Nevada County are teaming up to help feed those in need in Nevada County.  

Bring a can of food (or two or three) to the Country Christmas Faire on Sunday, November 29, and the Fairgrounds will give you a coupon for $1 off general admission to the Christmas Faire on that day.  Volunteers from HOPE will collect the cans at the food collection bins at the Fairgrounds from 10 am – 4 pm at Gates 1, 3 and 5, which is also where you’ll receive your coupon.

With the help of HOPE, all food collected at the Fairgrounds on Sunday will be used to help feed those in need in Nevada County.  HOPE in Nevada County is a program established through the Grass Valley Elks. Through this program, the Grass Valley Elks partner with the Food Bank of Nevada County to feed those in need, as well as working with the organization on a school snack program. HOPE distributes food once a month to anyone in the county in need of food.

The Country Christmas Faire is happening Thanksgiving weekend, November 27 – 29, at the Nevada County Fairgrounds. Hours are 10 am – 5 pm on Friday and Saturday, and 10 am – 4 pm on Sunday. Cost is $4, and free to children under 12.  Visit Nevada County Fair for more information or call the Fair Office at 530-273-6217.

Source Wendy Oaks, Nevada County Fair Publicists

Business, Local Writers & Contributors

Three marketing “clichés” that could skyrocket your sales

Lisa-J.-Lehr

by Lisa J. Lehr

  •  “It takes ‘seven touches’ to turn a prospect into a client.”

 

  • “Know me, like me, trust me, buy from me.”

 

  • “The money is in the list.”

 

What do these sayings have in common, and what do they have to do with your business? The answer to both questions is that they’re all true, and that understanding how to make them work for you could boost your bottom line exponentially. 

In my previous post about marketing (before the one about rescuing cats from trees), I talked about simple, inexpensive marketing tools. Now I’m going to expand on one of my points—the opt-in box. The opt-in box, remember, is where people enter their name and e-mail address and click “submit,” or words to that effect. This little box could literally bring in 90% of your sales; if you have one, you’re in a good position to capture the lion’s share of your market niche. 

It’s what happens after they click “submit” that really matters. Using an automated messaging system, you’ll send them a series of messages called “autoresponders.” This accomplishes several things. 

First, it keeps you top-of-mind. If one of the people who opt in (known as your “list members”) suddenly has a need for your product or service, and you’ve been sending him or her interesting information for weeks or months, you’ll be the obvious choice over your competitors. 

Second, it establishes you as an expert. You see, you’re not sending them constant sales messages—although sales messages certainly can be part of the plan. You’ll mainly be sending them useful, valuable information that they’ll feel indebted to you for—and possibly forward to friends. 

Third, it’s an inoffensive way to stay in people’s faces. The automated system includes an “unsubscribe” link at the bottom of every message, so if people get tired of hearing from you, they just click and you’re gone. No angry phone calls, no returned mail, no enemies. 

Autoresponders are particularly useful if your product is a one-time or occasional type of purchase or a seasonal item. People don’t buy a washing machine, a computer, or a Christmas tree, or get their windows washed or their gutters cleaned, every week. You don’t want your prospects to forget about you between that first visit and when they actually need what you offer. 

The messages can be created around any of a variety of themes. They can reflect current trends or news themes; they can be based on case studies or testimonials; they can each focus on a particular product or service you offer, or announce sales or specials; they can be “seven tips for…” or “ten ways to…” types of messages. 

Let me give you a first-hand example of a missed marketing opportunity by a local business owner. 

I’d won a free session with a particular type of service provider. It was a new experience for me; I found it enjoyable, and my curiosity about this service was piqued. I told the service provider that I was a marketing writer, yet strangely, I never heard from her again! Apparently she didn’t have a website, so she certainly didn’t have an opt-in box or an autoresponder series. So she missed two great opportunities—to sell additional services to me (far easier and cheaper than finding new customers), and to take advantage of my ability to market her services to others. 

Now, there are a few keys to making your opt-in box a success. First of all, your website has to be good enough that people will stay long enough to even notice you have an opt-in box. Second, the words on the box need to be compelling. (Hint: “submit” isn’t: no one likes to submit.) Third, offering an enticement, or “ethical bribe,” increases your opt-in rate dramatically. Enticements include a free e-book, report, white paper, informational message they can listen to or download, or free sample or consultation. How often you mail to your list depends on several factors, including the nature of your product or service. 

Let me emphasize that you don’t want to try to keep your own list and send the messages manually. Yes, the automated system costs money (contact me for the name of the one that 95% of Internet marketers use); however, not only is doing it yourself a lot of work, you’ll eventually get labeled a spammer and blocked from most people’s e-mail systems. 

Lisa J. Lehr is a writer and copywriter living in Grass Valley. She can help you promote your business with a full range of online and offline marketing pieces. A member of Empire Toastmasters, she’s available to speak to your business or professional group. Visit her website www.justrightcopy.com for more information, opt in for a message series, and receive a free Marketing Guide.

Local Writers & Contributors, Real Estate

Home Buyers Tax Credits Explained

federal-tax-credits

As you have probably heard, Congress passed a new act that extends emergency unemployment compensation during these difficult economic times. Included in that bill was the extension of the First Time Homebuyer Credit which was scheduled to end December 1st of   2009.  Not only has the credit has been extended but it has also been expanded to include a whole new group of potential homebuyers.

 First Time Home Buyers – This credit of 10% of the purchase price of the home or a maximum of $8,000 will remain available on purchases contracted by April 30, 2010 and closed no later than June 30, 2010.  A first time home buyer is defined as someone who has not had ownership in a personal residence during the 3-year period prior to the purchase of the home. 

A new provision has been added to include individuals considered Long-time Residents of the Same Personal Residence.  This provision includes homeowners who have used and owned the same home as principal residence for 5 consecutive years of an 8-year period.  When these individuals purchase a new home after November 6, 2009, they may be eligible for a 10% tax credit not to exceed $6,500.  

The following restrictions apply to both types of credits: 

  • A phase out for individuals with adjusted gross incomes of $125,000 to $145,000 for single filers and $225,000 to $245,000 for married couples filing a joint return.  

·        The purchase price of the home cannot exceed $800,000 or there is no credit of any amount. 

·        The credit is not available for buyers under age 18 or buyers who can be claimed as a dependent of another.  There are also additional restrictions on purchases of homes from family members. 

For extended duty military, Foreign Service workers and intelligence community workers who are serving outside the United States for at least 90 days, the credits have been extended by one year to April 30, 2011. 

To claim either of these credits, the taxpayer must include a copy of the settlement statement when filing their return.  

For tax planning purposes, keep in mind that the price of the home must not exceed $800,000 or the credit is lost completely.  Even a purchase price of $800,500 will eliminate the credit while a purchase price of $799,500 will qualify. 

The phase out amounts have been increased for this new time period which covers purchases between November 7, 2009 and April 30, 2010.  If you fall within the phase out ranges listed above, you can still receive a partial credit.  If your income exceeds those limits, no credit is available. 

No payback is required for credits unless the house ceases to be a personal residence within 36 months.  In other words, if you don’t intend to use the home for at least three years, be prepared to repay the full amount. 

If you have any additional questions regarding additional specifics of the Home Buyer Credits, please do not hesitate to call or email our office.

 Source: Courtsey of  Robertson, Woodford & Summers, LLP
 Abacus7.com

Real Estate

FIG Claims Scammed $94.6 Million by Member of Saudi Royal Family

3 Comments
Saudi Flag
Saudi Flag

PHOENIX (CN) – A real estate company claims that an alleged member of the Saudi royal family failed to honor a $94.9 million property purchase agreement and defrauded investors in a check-kiting scheme – and that some of the money may have been used “for activities hostile to the United States”. Foundations Investment Group claims that Sultan Alshaie and Royal Holdings produced false government documents to promote themselves as “international business investors” who operated in prominent business circles.

Foundations aka FIG Global claims in Maricopa County Court that one of the Alshaies’ false documents was a bank statement showing nearly $220 million in the account.

FIG says it entered “a venture of international investing into prestigious properties around the world” with Alshaie, who claimed he was interested in a resort property in Madeira, Portugal.
Alshaie and Royal Holdings allegedly transferred $80 million to a Swiss banking institution for the joint venture, prompting FIG to complete a final investment agreement, only to find that the transfer was “a decoy which allowed for multiple ghost transfers of exactly the same amount to be wired to other recipients in other parts of the world.”

The complaint states: “(A)uthorities from the United States government familiar with this transaction and others like it, including the parties involved, suspected that these funds were used for activities hostile to the United States”.

When the defendants transferred the money into the United States, Alshaie claimed that the accounts were frozen under the Patriot Act, and he continued to claim they were frozen though he actually had access to them, according to the complaint.

FIG says Alshaie then blew off its written demand for performance.

FIG Global seeks rescission, refunds and $94.6 million in damages. Also named as defendants are Nassir Alshaie, Ahmed Alshaie, the Alshaie Family Trust, Bernard Otremba-Blanc, Royal Holdings LLC and Royal Energy LLC.

Source Courthouse News     .

Bits & Pieces

Bits & Pieces in Nevada County

Gold Dredge
Gold Dredge

November 21, 2009 

I don’t know what happened this week. We were suppose to get some large storms starting Wednesday, but it faded to a small storm this Friday, with little rain and some minor snow fall.

Speaking of fall, it’s really here now in Nevada County, the weather has gotten colder and the trees have turned into the beautiful autumn colors.  We are in Downieville today, were the weather is somewhat milder because they are at the confluent of the Downie River and the Yuba River.  The rivers keep the weather cool in the summer time and the town from getting too cold in the winter.

It’s my understanding that the bears are still wandering around the town of Downieville because it’s not cold enough for them to hibernate. The mountain lions have been spotted around the hills and the deer go through town in groups of three or four.

The economy has been hurt here in Downieville because of the moratorium on dredging for gold in the river. I don’t understand what harm a little dredging can do to the river. I was here when the Downie and Yuba River flooded the town, swept away part of one bridge, and went into one of the local hotels and out the other side. I can tell you the boulders the size of small cars were being transported by the river and that did quite a lot more damage to the river than any gold dredging will do in a hundred years. 

My understanding is that the Fish and Game, along with the Forest Service has a bill in Congress to outlaw future flooding of the river by Mother Nature, with a potential fine to Mother Nature in the millions of dollars. 

The Keene family owners of Keene Engineering have been coming to Downieville for 60 years. They are makers of dredging equipment which is shipped throughout the world. Their equipment emoves mercury from the river and enhances the food supply for the fish and wildlife of the river.  Because of the dredging moratorium in California (a bill signed this year by governor Schwarzenegger), this was their last trip up here.  Of course this has hurt the local economy and tax base of Sierra County.