From the county’s Friday memo:
“As you have read or heard about in the media, there is a major real estate fraud case being prosecuted in Nevada County Superior Court by the State Attorney General. This case involves the alleged fraudulent real estate transactions by four individuals involving numerous victims and millions of dollars of real estate.
“The State Attorney General is spending hundreds of thousands of dollars if not millions to prosecute this case. Three of the four individuals charged have ironically declared themselves indigent and deserving of Public Defender services in accordance with the 6th Amendment of the U.S. Constitution.
“As you know, the Public Defender’s Office and other Indigent Defense costs are entirely funded out of the County’s general fund. The general fund is already under stress due to the steep decline in the real estate market which has severely impacted property tax revenues. The Public Defender has had to conflict out of the case for legal reasons approved by the Court.
“This means there are three private attorneys defending these three individuals at local taxpayer’s expense. We have estimated that at a minimum the defense costs of these individuals to the County’s general fund to be in excess of $600,000 annually. This criminal litigation could last multiple years meaning potentially millions of dollars being drained from the County’s general fund.
“This has the potential of creating a financial disaster for us and for other small counties who may find themselves in a similar situation. The projected cost to the County to litigate a case such as this would be equivalent to putting six deputies on the street, hiring eight child protective social workers, or ten road maintenance workers.
“Accordingly, we have contacted our legislative advocate and Senator Gaines office to seek assistance and relief in this matter. Senator Gaines office has been receptive to providing assistance. We have also contacted CSAC and RCRC for assistance. I will provide regular updates on this matter as more information becomes available.”
Filed under: Uncategorized
Think about the cost to taxpayers now of allowing a lending process like this to be welcomed and thrive in our County.
Speaking of the loss of taxpayer’s money, both local money and out of area money… where’s the final audit of the former Citizen’s Bank “failure” and taxpayer funded bailout?
How many millions and millions and millions did Citizen’s Bank lend to stupid, senseless, no demand for real estate development projects?
Which “developers” received all these loans, what projects were funded, which ones failed and where the heck were these projects?
Where did the money go, who got the now gone money and who provided the approvals for these millions and millions in now “lost” loans?
The names include local people and there are connectionss to local “hard money” lenders and a number of local “developers”.
How many millions of taxpayer’s dollars went into the Citizen’s Bank bailouts?
Why isn’t our local, conservative taxpayer spending folks screaming about this? They put a lot of effort into going after public pension funding isues in Nevada County… but not one word from them about Citizen’s Bank and the loss of taxpayers money.
Precisely….they are quick to argue for reducing pensions or cutting government, but when it comes to holding the private sector responsible for taxpayer bailouts of local financial institutions they are silent.
Steve Enos,
This is a good discussion. Though harsh sounding, it’s a cogent point.
Some people like to vilify you, but you often raise good points (from this to the Brown Act violations in Grass Valley to the unruly local campaign rhetoric). It is hard to be introspective in our community.
In fact, my wife and I were discussing this very same “red thread” of “go-go” money lending in our county over coffee and our PCs this morning — though we wouldn’t want to personalize it.
We did not understand the euphoria over real estate in our county in the “go-go” days. There simply aren’t enough jobs to justify it. Our economy is not diversified enough.
We bust our tails to make end’s meet in our household, as many do, at a fraction of the income from previously (“the pine cone tax”). That’s fine, because it’s a wonderful place to live, almost like a “year-round vacation.”
But we’re largely built on retirement, with an aging demographic, compared with the illustrious days of Charles Litton. It’s not very sustainable.
You’re right: The private sector got out of hand. The Citizen’s bank failure cost us taxpayers and still reverberates through the community. Citizen’s loaned money to Phil Lester, too, as the court documents show.
I absolutely see the irony in politicizing issues when it’s suitable (hammering on the County for public pensions, for example). But then “turning the other cheek” when it comes to the private sector abuses that were controllable.
Both should get equal billing, and we should learn from them. Or at least “people in glass houses should not throw stones.”
Three words, “In propria persona”.
Funny the Teapers arn’t protesting this like they did the Elections Office Computer situation.
This is an awful shame.
Another information trail that needs to be followed regarding Citizen’s Bank… after a long wait and after keeping failed development and real estate loans on their books at inflated values CB foreclosed on some of these failed loans.
Wouldn’t it be nice to see a list of those foreclosed on properties and projects, the names of folks involved, how much the loans were for, how much they sold for if sold, what was lost or made on them and which real estate folks had the listings for these?
Who were the real estate folks involved and how were they connected to CB, were any involved in or connected to failed CB development projects, real estate loans, hard money lenders involved in failed “projects” ?
Point is simple. All this info needs to be provided to the public. The public picked up the tab for all this, where did the money end up?