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Real Estate Fraud Serves as Warning to Investors

By Mike Wheatley | March 22, 2011

A California woman was handed a stiff 12 year prison sentence last Friday after duping hundreds of investors in a scam involving multiple fake real estate projects.

Connie S. Farris, 66, from Grover Beach, California, who netted millions from her elaborate fraud, was also ordered to pay back $31 million in compensation, after being found guilty of 39 mail fraud counts last November.

 

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Connie Farris promised massive returns on developments that simply didn't exist. Image courtesy http://arslexis.com

Farris’s ingenious fraud involved her running several companies, all operating under the same name, Global Express, which were purported to lend money to developers of real estate who would, according to Farris, purchase undeveloped land in California, Utah and Nevada.

The scam ran, which ran from 2001 until 2003, promised massive returns on investment, as much as 14%. Farris advertised in the Review-Journal while also recruiting new investors through word of mouth.

However, the developments simply didn't exist. Instead, Farris delayed being caught out by sending out regular updates to her investors, together with monthly interest payment checks. Finally, after two years of operating, her scheme was exposed and now justice has finally been served.

 

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Farris kept her scam going for two years by writing regular checks for interest payments. Courtesy of eyeclinic2020.com

U.S. Attorney Dan Bogden, who prosecuted Farris, thought it surprising that she had gotten away with her scam for as long as she did. According to him, the high returns promised should have served as an immediate warning that something suspicious was going on.

The lesson to be learned is one that we shouldn't need to keep on repeating. When certain entities or persons promise returns that are too good to be true, then it’s very likely they are just that. Be warned, before you write the check....

 

Mike Wheatley is the senior editor at Realty Biz News. Got a real estate related news article you wish to share, contact Mike at [email protected]
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