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Digging deep to recover for client defrauded

A few years back, I received a call from a real estate investor in Chicago.  As the housing crisis was hitting its depths in around 2009-2010, a local Realtor had decided to engage in “flipping” properties, buying for a low price, fixing them up and quickly re-selling them.

The Realtor convinced my client to invest in his venture by advancing money for properties bought and held in the Realtor’s name.  Since the Chicago investor did not come to Cincinnati frequently, he relied upon the Realtor to provide regular updates on progress on purchases, sales and property improvements.

The investor had invested some $60,000 with the Realtor, and as time passed he was concerned about the lack of progress towards getting a positive return on his investments.  He then contacted a second local Realtor to visit one of the properties, and learned that the work that supposedly had been progressing for months and was close to completion ,according to the first Realtor, was not even underway.  The first Realtor was simply defrauding the Chicago investor out of his monies.

Our firm wrote to the Realtor and laid out emails, documents, and photographs showing that he had committed fraud, and gave him a short window of opportunity to make things right.  The letter threatened civil action, but it was clear that criminal actions and loss of his real estate sales license was also at stake.  We spoke with the Realtor and reiterated that he needed quickly to make things right…or else.

Within 48 hours of that call, the Realtor died in a head-on auto collision at a high rate of speed.  An investigation showed he had, essentially, no assets.

Normally, the defrauded investor would just “give up.”  The monies invested in legal fees would be wasted because it appeared no recovery was practical.

However, our firm was aware that Ohio has a “Real Estate Recovery Fund” that indemnifies innocent consumers for the misdeeds of Ohio real estate agents in the course of their duties, capped at $40,000 per license (O.R.C. Section 4735.12).

We pursued and collected for the client nearly the amount of the limits from that fund for a claim that was otherwise against an insolvent and deceased fraudster.

Let us know how we can “make a difference” for you.