Details on real estate agents’ roles in HOA fraud revealed

New details surfaced Thursday — including on the role of real estate agents — in the long-running criminal investigation into fraud and corruption at Las Vegas-area homeowner associations.

The details were revealed in newly unsealed plea-bargain deals for the latest 15 people to agree to plead guilty in the probe that first became public in 2008. In all, 27 people have agreed to plead guilty in the HOA probe and a related probe into bank fraud at the downtown Courthouse Cafe. More plea deals and even indictments are expected in the case.

Fourteen of the most recent 15 defendants to be named pleaded guilty Thursday in U.S. District Court to conspiracy to commit mail and wire fraud. The 15th defendant was ill and is expected to appear in court later in the summer to plead guilty. Sentencing is planned for February.

As has been previously reported, those who had agreed to plead guilty on Thursday included two former Metro police officers, two attorneys, a property management company owner and several straw buyers.

Prosecutors say they and others schemed to install co-conspirators on HOA boards from 2003 to 2009. The boards would then award lucrative construction defect lawsuit and repair work to the alleged ringleaders — believed to be construction company owner Leon Benzer and the late attorney Nancy Quon. Attorneys participated by knowingly running rigged elections or by failing to disclose conflicts while secretly working for the benefit of the ringleaders and to the detriment of condo owners.

Benzer has not been charged and has vowed to fight allegations of wrongdoing. Quon before her death in March denied wrongdoing.

In Thursday's plea bargains, prosecutors for the first time spelled out the role of a couple of real estate agents in the scam.

Anthony Wilson, aka "Tony" Wilson, admitted in his plea bargain that as a real estate agent, his role was to find condominiums for the schemers to purchase so they could install cronies on the HOA boards. He identified at least 17 condos for purchase at various complexes and knew they would typically involve "straw buyers,'' or buyers fraudulently buying property in name only on behalf of the scam ringleaders.

Wilson also admitted to helping the straw buyers file fraudulent mortgage loan applications and at times during the scheme urged the ringleaders to pay with cash to avoid creation of a paper trail so as to hide the conspiracy.

Wilson's plea bargain says he also suggested "various schemes" involving kickbacks from HOA vendors to the ringleaders.

For his efforts, Wilson earned some $115,700 in commissions for selling condos to straw buyers and other participants in the conspiracy, his plea agreement says.

Another real estate agent, Patrick Bergsrud, admitted in his plea bargain that his role in the conspiracy also involved identifying condominiums to be purchased by his co-conspirators.

Bergsrud also acted as a straw purchaser at several HOA communities and in buying some of the condominiums in his name, he signed and submitted false and fraudulent loan applications and closing documents to banks, his plea agreement says.

Prosecutors say notary publics participated in the overall scheme by falsely notarizing some of the documents submitted to banks and other institutions.

At one condo association, Vistana, Bergsrud was elected to the HOA board of directors in what he knew was a rigged election, his plea bargain says.

Once on the board, he "breached his statutory fiduciary duty to the homeowners by accepting from his co-conspirators compensation, gratuity and other renumeration that improperly influenced his decisions, resulting on a conflict of interest,'' his plea bargain says.

Also Thursday, prosecutors revealed that as part of the overall conspiracy, now-disbarred attorney Jeanne Winkler served as an official for a group called "Safe Homes of Nevada Inc.'' that was formed in 2002 by a ringleader — believed to be Benzer — "to identify construction defect cases and raise awareness of construction defect issues at the condominium complexes in or around Las Vegas.''

Prosecutors separately revealed that as part off the scheme, more than $8 million moved through five banks accounts set up by the perpetrators in the 2000s. The accounts funded the operations of the scheme including paying its participants. An attorney and law firm — believed to be Quon and her law firm — deposited a total of $2.981 million into these accounts in three separate deposits, prosecutors said in a charging document.



Previous Discussion:

Discussion 3 comments

Only trusted comments are displayed on this page. Untrusted comments have expired from this story.

  1. lately duck creek village has some construction defect financial obligations. I wonder if it is part of the HOA mess...

  2. Part 1

    Sadly, the plea deals described above are simply a "cover prosecution" which neatly packs away the economic corruption at 12 homeowners associations, so that other 'corrupt' homeowners associations and their sophisticatedly devious management companies in Nevada can go their merry way and the abuse of homeowners and their pocket books can continue unabated in Nevada. Attorneys from the Dept. of Justice in Washington could stay in Las Vegas FOREVER, prosecuting HOA managers' and Directors' self-dealing, and never finish the job, because the crooks are continuously learning from what the DOJ lawyers are doing and because homeowners are barred, by Nevada law, from taking matters into their own hands in terms of filing litigation against HOA Directors and managers for wrongdoing.

    First, it's important to note that there are roughly 5 land developer-controlled HOAs in Las Vegas, "regulating" huge master planned communities, where by clever drafting of CC&Rs and in some cases by not-so-clever lying by the developer's employees who serve as Directors on those HOA Boards, the actual homeowners in these master planned communities probably NEVER will get control of their own HOA Boards of Directors, and never be rid of management companies cozy with or outright controlled by the master planned community developer. (When the management company for Summerlin was one of hundreds of companies controlled by Rouse which was put into Chapter 11 bankruptcy, the Las Vegas print press never covered the story and Nevada's Real Estate Division did nothing publicly to protect the HOAs the bankrupt management company "managed".)

    Second, it's useful to note that managers of HOAs and lawyers representing HOA Boards of Directors are carefully watching this Federal prosecution as a means of learning how they should maneuver to avoid prosecution or civil litigation for what they are doing.

    Third, until the Nevada Legislature abolishes the Ombudsman program, abolishes statutorily mandated arbitration and invalidates any CC&R required arbitration, many Nevada homeowners will continue to be denied their rights to equal protection, due process and access to the courts for redress of their grievances. Until those repeals of anti-homeowner laws happens, each and every homeowner living in an HOA should know that their State Senator and Assemblyman are not working in their best interest, and instead are working in cahoots with CAI and the sophisticatedly self-serving HOA managers and management companies. HOA management companies and managers know they are above the law, advise HOA Boards of Directors that they too are above the law, and that no aggrieved or abused or lied-to homeowner has any meaningful or economically feasible way to seek redress of their grievances.
    In short, the HOA managers and Directors know they can stick-it-to dissident homeowners and they do it all the time, with impunity.

  3. Part 2

    Fourth, the CAI/HOA manager community have undue influence over the Nevada Real Estate Division, and until that stops nothing will change in terms of manipulative and corrupt HOA managers. A complete sea change in WHO the Nevada Real Estate Division wants to protect will not happen unless Governor Brian Sandoval changes both the state employees on the executive level of NRED and the identity of the appointees to the "Commission" managed by NRED which is supposed to oversee and discipline HOA managers.

    Fifth, the legislative history of the requirement for homeowners complaints against their HOA Boards of Directors and HOA managers to go to mandatory arbitration is directly traceable, through minutes of Nevada Legislature committes, to former Sen. Mike Schneider who has billed himself to the press "as the homeowners advocate". The reality about Sen. Schneider is that the legislative committee meeting minutes for the year the mandatory arbitration was imposed on Nevada homeowners show that it was Sen Schneider who justified that mandatory arbitration provision by saying, to his committees, 'There are too many lawsuits being filed by homeowners against their HOA Boards and management companies'.

    Bottom line, these criminal prosecutions relating to 12 homeowners associations change absolutely nothing for the benefit of the average homeowner living in an HOA in Nevada.

    Instead, the entire legislative scheme in Nevada is rigged to insulate HOA managers from their own wrongdoing, incompetence and waste and is rigged to protect HOA Board of Directors from their own lack of attention to and lack of supervision of what their managers are doing (as is required under the principal/agent common law.) The entire legislative scheme in Nevada is also rigged to protect the HOA Directors from consequences for stupidity or outright venality.

    Until each and every homeowner in a Nevada HOA has the right to go directly to District Court, to seek "redress of grievances", nothing will change. Shame on you Sen. Schneider and Nevada Legislators for affirmatively denying Nevada homeowners their rights to due process and equal protection in a court of law.