Dornin Investment Group Faces Fraud, RICO Lawsuit.
A federal civil lawsuit charges Dornin Investment Group with several counts of fraud and racketeering.
August 1, 2012 (Newswire.com) - A federal civil lawsuit charges Dornin Investment Group with several counts of fraud and racketeering.
Laguna Beach-based Dornin Investment Group is charged with violations under the Racketeer Influenced and Corrupt Organizations Act, The Federal Fair Housing Act, The Protecting Tenants at Foreclosure Act, Unfair, fraudulent and deceptive business practices, violations of the Los Angeles Rent Stabilization Ordinance (LARSO) and to redress discrimination on the basis of race.
The complaint (CV12-05244 PA AGRx) filed in the United States District Court, Central District of California alleges that defendants Wilshire State Bank, Pearson Affiliated Inc., Keller Williams Commercial Realty, Dornin Investment Group, SAFCO Capital Group et al, were each involved in a conspiracy to violently harass and extort tenants, terrorizing tenants of a lender-foreclosed property to force them to move.
The suit alleges that under defendants' "evict and sell" business model, when they became the owners of the 701 South Mariposa building through foreclosure, the defendants chose to use "strong arm" evictions against the tenants residing at the property in order to enhance the property's sales prospects and to facilitate the sale of the foreclosed property.
Named in the lawsuit is Wilshire State Bank, realtor Yitzy Pearson of Pearson Affiliated, John Safi of SAFCO Capital Group, realtor Seth Polen of Keller Williams Commercial - Pasadena, Chris Dornin of Dornin Investment Group and Roman Celusta of 709 South Mariposa Inc.
The suit alleges that the plaintiff's mailbox became a source of fear and intimidation as the defendants misused the U.S. Postal System to pepper the plaintiff with written notices, demanding that the plaintiff accept a relocation offer or face imminent eviction. Continuous intimidation, threats of eviction, threats of homelessness and financial injury were allegedly directed at the plaintiff to induce the plaintiff to move.
The alleged scheme which involved 1) Wilshire State Bank, a leading FDIC-regulated banking institution and 2) Pearson Affiliated Inc., a full-service property management company and 3) SAFCO Capital Group, a real estate management firm and 4) Keller Williams Realty, a commercial real estate firm and 5) Dornin Investment Group, a commercial real estate investment firm has allegedly defrauded the plaintiff's neighbors of their residential dwellings.
The RICO suit alleges that each defendant was integral to the enterprise's objective which was to rid the lender's foreclosed property of rent-controlled tenants by any means necessary. The threat of eviction and the filing of meritless Unlawful Detainer actions against the plaintiff and the plaintiff's former neighbors were used as forms of "extortionist litigation".
The suit alleges that the defendants attempted to regain the plaintiff's unit by the wrongful use of force, which in this case was harassment and a constant fear of eviction. A felon currently on parole, was hired by Pearson Management, the building's property management firm, to harass and threaten tenants, the suit alleges.
According to the lawsuit, the proceeds from the defendants' racketeering activities allowed them to re-market and re-sell a multi-million dollar property profitably and allowed the defendants to derive unlawful proceeds from their unlawful activities.