Friday, January 04, 2013

Paul Page Pleads Guilty In Real Estate Fraud Scheme

Paul Page
Federal prosecutors have secured a major break in their ongoing investigation and prosecution of political insiders accused of defrauding the state's Department of Child Services regarding the purchase and subsequent lease of real estate in Elkhart, Indiana to the state agency. Indianapolis attorney Paul Page, one of three business partners originally charged by federal prosecutors last year in the Northern District of Indiana, has agreed to plead guilty to a felony wire fraud charge. According to a report by the IBJ's Cory Schouten, Page has agreed to cooperate with federal investigators in exchange for dropping 13 other charges against him. Schouten reports there is a separate parallel investigation in Indianapolis which may be targeting former Marion Co. Prosecutor Carl Brizzi, Page's business partner.

In his plea agreement, Page stated that he conspired with John Bales to commit the fraud by agreeing to carry out the purchase of a building in Elkhart, Indiana that would be leased to the Department of Child Services. Bales' bank wired money to a title insurance company to permit Page's company to acquire the building through an entity formed by Bales' Venture Real Estate Services, known as L&BAB, LLC. According to Page's plea agreement, the initials stood for "Lazy and Broke Ass Bitch," which Page explained was how Bales used to refer to him. Page agreed to repay the money wired into the bank account to Bales' company, along with a share of profits once the building was resold for a profit. Although Bales was under contract to provide services to the state of Indiana and was barred under its contract from the state from participating financially in such transactions, his Venture Real Estate business earned a commission of $88,400 and a $28,875 brokerage fee on the sale of the Elkhart building. Page stated that L&BAB received a $22,700 development fee at closing on the real estate, which it remitted to BAB Equity. About six months later, BAB Equity kicked back to Bales' Venture Real Estate a $33,808 development fee.

As part of this scheme, Bales and Venture Real Estate assumed responsibility for leasing the Elkhart building to the state of Indiana. Bales, according to Page, also provided a back-dated mortgage to Page to execute and record on the Elkhart Building to secure the money Bales had provided to purchase the building without the knowledge or consent of his bank's lender. Page understands that by signing the plea agreement he can receive a maximum sentence of 20 years and be fined up to $250 million. Page further admitted that he had defrauded a financial institution out of more than $1 million by engaging in the scheme.

Page's attorney, Robert Hammerle, blames Bales for orchestrating the entire scheme. Schouten asked Hammerle whether he believed Brizzi was a target of the separate investigation in Indianapolis, to which Hammerle replied: "Use your own judgement. Beyond that, I'd refer you to the U.S. Attorney's Office." The U.S. Attorney's Office says it could not confirm or deny whether Brizzi was a target of the investigation. Several weeks back, a rumor began circulating that there was a sealed indictment against Brizzi. When Brizzi was asked by this blogger about the rumor, he indicated that it came as news to him. "During the [Page] hearing, Barrett described the probe as a 'parallel investigation in the Southern District into conduct in which Mr. Page was involved,'" Schouten writes.

UPDATE: Fox 59 News' Russ McQuaid has more on the Brizzi angle to this story:

Brizzi previously told Fox59 that he was granted half interest in the building, worth an estimated $500,000, as a “finder’s fee” even though he put no money into the deal. Bales and Page have been longtime associates of Brizzi’s, donating money to his campaign for prosecutor as well as engaging in other personal business deals.
Fox59 first reported on allegations of questionable plea deals approved by Brizzi in early 2010. In one deal, Page represented steroids dealer Joseph Mobareki. In a rare move as part of the plea bargain, Brizzi approved returning money seized by narcotics officers to pay Page’s legal fees.

In July of 2009 Brizzi and chief trial deputy David Wyser approved an unusual sentence modification of convicted killer Paula Willoughby. Willoughby, who was originally sentenced in 1991 to 110 years in prison for the murder of her husband Darrell, was given an early release.

Willoughby’s father, Harrison Epperly, donated at least $55,000 to Brizzi’s 2006 re-election campaign. Willoughby’s attorney, Jennifer Lukemeyer, held a political fundraiser for Wyser at her downtown condominium a month after the early release. Brizzi and Wyser have always maintained the early release was for humane reasons, including that Willoughby’s remaining son was without parents since his father had been murdered and his mother in prison.

Brizzi was a personal associate of convicted swindler Tim Durham. Durham was sentenced to prison in November for his role in the $200 million collapse of Fair Finance – an Ohio-based firm where Brizzi briefly served on the board of directors. Brizzi and Wyser both received campaign donations from Durham.

1 comment:

I know said...

It would be real nice to see Brizzi open up the treasure chest and bring all the wonderful mess of other illegal state contracts. He and his deputy prosecutors interviewed several witnesses more than once on illegal contracts in the gaming commission awarded to state appointed officials that sat on the same panel that awarded the contract to Trump and when he left the panel with French Lick Springs hotel employees on the panel awarded a peer committee member the 40 year award and then went to work for the contractor with the State of Indiana.

Mr. Brizzi take a few down with you! The IG knows, the AG knows and the former governor knows what his gaming commission and staff pulled off. It was far more blatant then Paul Page and bales. The gaming director asked the IG, the AG and the administration to look outside the normal boiler plate contract and language and award a self written contract to the former committee member.

The FBI knows it, the State Police knows it and the Federal Court knows. The former ethics chair of the house resigned to take a state highway director job to leave the mess behind after he stood on the house floor and told everyone it was illegal.

Keep going Indiana it only gets seedier by the event