Wilshire State Bank Target of RICO Lawsuit.
A federal civil lawsuit charges Wilshire State Bank with several counts of fraud, extortion and racketeering.
Online, August 8, 2012 (Newswire.com) - A federal civil lawsuit charges Wilshire State Bank, SAFCO Capital Group, Dornin Investment Group, Pearson Affiliated Inc., Keller Williams Realty, Pacific 701 Mariposa LLC, 709 South Mariposa Inc., and 701 Project LLC with several counts of fraud, extortion and racketeering. The lawsuit alleges that defendant Wilshire State Bank, through greed, partnered with investment speculators who took a rent-regulated property and stole it through extortion in a predatory equity scheme
Defendants Wilshire State Bank, SAFCO Capital Group, Dornin Investment Group, Pearson Affiliated Inc., Keller Williams Realty, Pacific 701 Mariposa LLC, 709 South Mariposa Inc., and 701 Project LLC are 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 lawsuit alleges that it is not a simple landlord - tenant dispute and that the case has substantial federal interest as it involves evidence of fraud, collusion, corruption, and other misconduct on the part of a leading Southern California FDIC-insured bank, two equity investment firms, two realty firms, two realtors and a member of the bar, all of whom were involved in a conspiracy to illegally recover possession of a rent-regulated apartment building and to harass and extort a protected class of tenants. The enterprise, referred to as: "LA COSA WILSHIRE BANK" engaged in a sustained pattern of racketeering, including extortion, mail and wire fraud, money laundering, bank fraud and an organized, litigious eviction "shake down" of the plaintiff.
The lawsuit alleges that the motivation for the defendants' conduct was corporate greed. The defendants, unable to meet their mortgage payments from the rent rolls of 701 South Mariposa, realized that the only way to squeeze out the returns demanded from the rent-regulated building was to force existing tenants out. The defendants calculated that they could replace poor and working class tenants with new higher-income tenants willing to pay much higher rents - thus producing profits quickly. To carry out this scheme, a RICO enterprise was formed between Wilshire State Bank, two private equity investment groups, an eviction attorney and two real estate professionals to regentrify a rent-regulated building and steal tenant property.