Okun Sentenced to 100 Years: Guilty on 23 Counts of Fraud

The final chapter is over for the prosecution portion of the Ed Okun 1031 Tax Group rip off. The victims continue to watch their restitution go down the drain but in a show of force Ed Okun, the architect of a $126 million ponzi scheme, was sentenced to 100 years in prison today. Okun’s lawyers were seeking a sentence of 10-15 years. Thankfully Okun’s attorneys had no power in making that sentence a reality.

The Richmond Dispatch Times article.

The article that started it all 1031 Advance Private Exchange Company Missing In Action In Silicon Valley.

Top deansguide Ed Okun articles from the archives:

http://deansguide.wordpress.com/2007/06/20/one-of-the-350-victims-of-ed-okuns-bankrupt-1031-exchange-empire-speaks-outthe-most-compelling-case-yet-for-action-to-be-taken/

http://deansguide.wordpress.com/2009/03/19/okun-juror-speaks-out-okun-guilty-could-face-400-years-deansguide-odyssey-ends/

http://deansguide.wordpress.com/2009/06/23/usa-vs-ed-okun-amended-preliminary-restitution-report/

http://deansguide.wordpress.com/2009/02/14/ed-okun-victim-cautions-landamerica-victims-challenges-government-admonishes-1031-exchange-industry/

http://deansguide.wordpress.com/2008/04/18/mystery-caller-claims-okun-broke-without-representation-gordon-gecko-a-cautionary-tale/

http://deansguide.wordpress.com/2007/06/29/ed-okun-promises-to-make-good-is-this-a-checks-in-the-mail-statement/

Thanks to Leanne Follis for her timely tip to the Okun verdict. Here is Leanne’s comment:

Dean,
Have you seen this?
http://www2.timesdispatch.com/rtd/news/local/article/OKUNGAT04_20090804-142201/283992/

Ed Okun.. sentenced to 100 years!!! Finally, some justice. Now we wait to see Lara Coleman and the
others to rec. their new sentences, what they pled to.

Check it out!!!

from: a former employee

LandAmerica Exchange Services Victim: “Any Class Action Lawsuits Yet?”

Reuters.com published this deansguide article 12-12-08

Another deansguide readers, in the growing line of LandAmerica exchange victims, has spoken out. The message from Cathy is loud and clear. How do victims, who have lost their entire or majority life savings, pay for legal assistance in pursuing their “stolen” monies?

The Conundrum

1. Spend Money: pursue “lost” life savings by using what little money you have left or going into debt to attempt to pay for legal representation.

2. Chalk It Up: chalk it up to experience. Do not pursue recovery by spending money. Hope for the best but do not chase your money with more money. Allow LandAmerica to skate free of charge.

3. Legal Action: hope for a class action lawsuit where no investor’s money is required to possibly recover lost monies.

Cathy’s Comment

“I, too, have a big chunk of change stuck in LES. Now, I know I have to file my proof of claim, but who can afford a lawyer, now? Are there any class action lawsuits going on yet against LES? Hate to give what little I have left to an attorney.

thanks for anything.”
Cathy

Investor’s Warning: Ed Okun, FEA, Bonding & Insurance Still Major Barrier To Entry

Reuters.com published this deansguide article on 11-8-08

When deansguide readers have important comments that effect and provoke the thought process on a particular issue–we listen. When the comment comes from a very reliable source, a trusted confidant, and someone very close to a “situation”–we listen. And when that person is Elizabeth Callanan, one of the ‘experts’ following the Ed Okun 1031 Tax Group debacle–we stand back and give her the floor.

Standards of Due Diligence

Elizabeth Callanan’s comment (11-9-08) and indictment of the 1031 industry’s lack of due diligence standards, the FEA’s less than honest assessment of their own insurance policies, and investor’s lack of investigation (electing to avoid massive taxes by choosing a 1031 exchange) is a cautionary warning-before you even think about this industry you must read this information.

—————————————————

“I’m very interested in learning how prospective 1031 exchangers can “look at the longevity of ownership, management, and employees as well as bonding and insurance and experience.” In the case at least of the 1031’s quietly acquired by Ed Okun, who then proceeded to plunder the exchange funds held by each of them to acquire other 1031’s and finance his lavish lifestyle, nearly all of them had been in business for decades. The fact that the owners, in some cases known personally to exchangers over a long history of 1031 transactions, did not publicize or share with their client base the fact that they’d sold out to Okun and, in fact, remained on board in their former roles and capacities, along with their staffs, appears to have been part of a deliberate strategy (perhaps even a condition of the sale?) to hide from exchangers that any transfer of ownership had occurred. Where/how would a potential exchanger learn that ownership had changed? To what agency (federal, state, local) must a 1031 report its ownership. What requirements are there that demand that such information be published. What regulations or reporting exist governing the behavior and conduct of 1031’s at any level?

As to insurance, what should a prospective 1031 client look for in an insurance policy provided by a 1031? The fidelity bonds provided to customers of those acquired by Okun gave false assurances of coverage in the millions, but in fact, like the fidelity bond offered by the Federation of Exchange Accomodators (according to their website), “Q: How does the policy limit under the FEA Fidelity Bond apply to claims?
A: The policy limit applies on a “per occurrence” basis, meaning each separate loss event or series of related loss events has the full benefit of the policy limit. Losses are usually considered related, i.e. a single occurrence, if they arise out of the same set of circumstances. The limit does not apply per customer, per transaction or per account.” While exchangers to whom these Fidelity Bonds are routinely presented as some kind of assurance regarding the security of the funds held by the 1031 would reasonably interpret their transaction as the “per occurrence” covered by the bond value, FEA’s FAQ’s attempt to limit that coverage to each incident and insurers in the case of Okun are already attempting to construe him and his ongoing series of embezzlements from multiple 1031’s he acquired over time as a single occurrence. Since collectively he embezzled $150 plus million, these bonds are wholly inadequate in terms of providing any kind of security to exchangers. So, what should exchangers be demanding to see from prospective 1031’s they’re considering in order to assure themselves the 1031 is in fact a “safe harbor” and their funds will in fact not be absconded with? What regulations is the FEA promoting at any governmental level that would ensure the security of exchanger funds, the integrity of 1031’s, their owners and staff, and what penalties (criminal, financial, etc.) are they proposing in the event there is criminal activity?” –Elizabeth Callanan

U.S. Trustee McHale “Continuation of Bankruptcy-Criminal Proceedings Collectively Serving The Interests of Justice”

United States Trustee Gerald McHale recently brought suit against Wachovia Bank, and affiliates, for the recovery of “$43 million of conveyances allegedly made to Wachovia in the form of cash and mortgage liens, and the imposition of equitable liens and constructive trusts on several properties in which Wachovia continues to hold liens, or the proceeds therefrom.” Allegations abound that Wachovia not only helped Ed Okun in his scheme but perpetuated it’s continuation despite their (Wachovia’s) knowledge that Okun was violating many banking laws in his business practices.

Today Gerald McHale announced that he has filed a “Statement of Position and Response” to judge Payne’s order in the Ed Okun criminal case. The statement was filed in regards “to the effect of the pending bankruptcy cases of the 1031 Debtors on the likely availability of funds for the purpose of restitution in the criminal case.” The statement was filed October 15, 2008.

3 Key Points

1. McHale agrees “concurs” with the presentation set forth in the Government Statement filed September 12, 2008. See US vs Okun (Government Position) pdf bottom of article.

2. McHale submits that the continuation of the bankruptcy proceedings and the criminal proceedings “are collectively serving the interests of justice and judiciary effciency.”

3. McHale asserts that “Victims of the criminal case are better served by the bankruptcy process which is well underway and has already resulted in the liquidation of many tangible assets and other recoveries.”

Sad But True

The saddest but most likely true statement is the one McHale uttered at the end of his announcement:

“Victims could see some recovery through the bankruptcy process sooner than the time that would be required for the defendant’s convictions in the criminal case will be final.”

Ed Okun Tax Group Scandal Reaching Climax: Is Recovery of Monies in The Cards?

Reuters.com published this deansguide article September 26, 2008

United States Trustee Gerald McHale’s 9th newsletter briefing of the status of the Ed Okun 1031 Tax Group case highlights the difficulty and frustration of trying to “get blood from a stone.” The proverbial stone being Okun and the assets which seem to either be non existent or hiding.

Highlights or Lowlights?

The people waiting for some type of settlement must be getting very restless and asking questions non stop. I am sure Mr. McHale is doing his best to get as much money back as possible but the following plea says it all:

McHale in an open plea to the “Train Wreck Victims”

“Trust me when I say that it goes against my open nature and I know how frustrating it must be not to have your questions answered in detail. . . “

Major Points

1. Supplemental Proof of Loss was filed by McHale July 30, 2008 “containing extensive analysis”

Analysis: What effect this supplement will have on recovery is anyone’s guess. At least McHale is working as much information into the mix as possible in regards to proving further damages and seeking compensation. The frustration for victims is they are often kept in the dark

2. JPS Capital, our old friends (Mr. Shapiro) who decided to set the record straight with deansguide but never delivered on that promise, are now a target of litigation or as McHale so clinically puts it “we have commenced an action against JPS and other parties asserting an interest in the New Hampshire lakeside mansion.” The goal is to recover $5.1 million in debtor monies

3. Richard Simring and David Field Plead guilty. For more information see Julie Kay’s article in it’s entirety on McHale’s site here

4. Ed Okun and Laura Coleman trial dates set for January of 2009

The saga continues as more money is being recovered, fewer players are left standing, and the victims remain holding the bag!

Okun promises
Monies disappear

Mystery caller

Vesta Strategies “Sales Pitch” Marketing Information They Forgot To Pull?

Information about Vesta Strategies LLC is beginning to come into view–and the view is quite ugly. Attempts to find old information about Vesta on the other hand is difficult to find. Yet with some digging, reminents of their marketing campaign can be found. The following is a pitch found on a social networking site for a Vesta Strategies employee:

Vesta’s Sales Pitch

“Just as McDonald’s doesn’t actually sell hamburgers, Vesta Strategies LLC doesn’t really sell 1031 exchange solutions. We sell personal service. For most anyone who utilizes the services of a qualified intermediary or accommodator, peace of mind and security are of high importance. As an established national provider of 1031 exchange solutions, Vesta Strategies LLC differenciates itself from the competition through personal, hands-on service. In addition to my own expertise, cour clients can draw from our large offering of resources in legal counsel, real estate practices, title questions, NNN leases, DST’s, and TIC’s.”

Final Pitch

At Vesta Strategies LLC, we specialize in virtually anything related to 1031 exchanges. We provide expert information about how to structure exchanges, how to find replacement properties, and whether or not an exchange makes sense for you on a particular transaction.”

Okun Indicted On 27 Counts: Is Okun On Suicide Watch?

Ed Okun and accomplice Lara Coleman, somebody the mystery caller mentioned months ago as “going down”, face a 27 count indictment as handed down and reported by Gerald McHale this past week. The indictment laundry list of counts:

1. Wire and Mail Fraud Conspiracy: Count 1
2. Money Laundering Conspiracy: Count 2
3. Wire Fraud: Counts: 3-15 (1343)
4. Mail Fraud: Counts: 16-18 (1341)
5. Money Laundering: Counts 19-21 18 USC & (1956 (a) (1) (A) (i))
6. Money Laundering: Count 22 18 USC & (1956 (a) (1) (B) (i))
7. Money Laundering: Counts 23-25 USC & (1957)
8. Bulk Cash Smuggling: Count 26 31 USC & 5332
9. False Declaration: 18 USC & 1623

In the face of this indictment, the fact reported by Mark Heschmeyer that one of his buildings (Shreveport) has natural gas deposits valued at $30-60million-something he can’t touch, and the possible collapse of his marriage and network of friends, it is rumored that Ed Okun has been placed on suicide watch.

Here is one of the only pictures available on the internet of Ed Okun (far right) during a press conference announcing the sponsorship agreement with Foyt Racing. Photo courtesy of Foyt Racing.

Note: This conference was in 2006 long before it was public news that Ed Okun’s wealth was derived from the ponzi scheme known as 1031 Tax Group and affiliates:

//www.foytracing.com/IndyCar/2006_reports/photos/IMG_1458.JPG” cannot be displayed, because it contains errors.

1031 Tax Group Okun Swindle “Mantra”: “The plaintiffs’ money has ‘disappeared’ and recovery is unlikely”

Reuters.com published this deansguide article July 9, 2008

What has become an all to familiar phrase in the Ed Okun 1031 Tax Group (IXG) ponzi scandal, seems to be the dreaded mantra: “The plaintiffs’ money has disappeared and recovery is unlikely.Those were the words recorded in court hearings in Colorado this past month in regards to the embezzlement of funds through the Ed Okun held IXG exchange in Denver.

Exhibit 1: Sergio S. Alvarez v. Daniel E. McCabe

In “Sergio S. Alvarez v. Daniel E. McCabe et al, eight former clients are suing all three McCabes and Simring (Richard) for losses totaling more than $4.5 million” according to the latest from the Denver Business Journal’s Renee McGaw.

Eight clients were in the midst of their tax deferred exchanges with cash assets between $280,629-$1.9 million dollars lost when the 1031 Tax Group filed bankruptcy

Exhibit 2: Ward Enterprises LLC v. Daniel E. McCabe

The Plaintiff (Wade LLC) wired $3,300,000 in proceeds from a real estate transaction to IXG’s account held at the United Western Bank in Denver. Proceeds were for the purpose of performing a 1031 exchange

In the meantime IXG had been sold to Okun and his 1031 Tax Group-something Ward LLC did not know at the time. Consequently Ward expected it’s millions to be deposited in a separate, stand alone, account. Unfortunately for Ward, their monies were “pooled with other exchangers’ money and later moved out of United Western Bank”, according to allegations of the Ward suit.

The Beat Goes On

As usual nobody is taking responsibility for these illegal transactions. The McCabes are stating that they are innocent and victims of Okun’s dirty dealing. So the beat goes on, victim’s monies disappear and nobody is left holding the bag–except the victims

Newsflash: Ed Okun Denied Bond, Remains Incarcerated

This just in courtesy of the “mystery caller”: Ed Okun’s attempt to secure bail and his freedom was denied today at his bond hearing in Richmond, Virginia. The hearing, which ran from 2pm to 5pm EST, was previously postponed so that Okun could build a case for gaining bail. Okun charged with multiple counts in relationship to his “ponzi” like scheme which bilked investors out of $160 million, was denied bail as:

1. Flight risk

2. Danger to the Community at large

His court appointed attorney was present; and according to the “mystery caller” original Miami attorney Michael Rosen was also in attendance.

Analysis

There is a very sad and ironic problem with keeping Ed Okun incarcerated. There is no way to force Okun to pay restitution if he is incarcerated. Not that Okun would have the ability, means, or method to legitimately pay back Train Wreck Victims.

But with Okun incarcerated, there is no hope at all in recovering anything that he may have hidden, if he hid anything at all, or forcing him to “work” for his victims.

Now it seems the only hope that victims of Ed Okun’s collapsed 1031 scheme have in recovering their monies is to go after the insurance companies involved in the transactions.

Where Is Ed Okun: Federal Bureau Of Prisons Inmate Locator Snafu Or Is There More?

Reuters.com published this article on April 12, 2008

As if the Ed Okun embezzlement case does not have enough stress and heartache for the victims, aka “Train Wreck Victims” who lost their life savings, now a cursory check of the Bureau of Prison’s inmate locater shows the following status dated April 13, 2008 for Ed Okun: “RELEASED”

Although this is most likely an oversight, it is just another in the long line of shots these people have had to endure during their attempt to recover their lost fortunes.

This instance brings to mind the internet lightening strike regarding fabled drug kingpin Carlos Lehder of the Medellin Cartel. George Jung, a number of attorneys, and journalists have posited on the internet that Lehder never spent a night in jail–even though he was convicted for his part in the importation and distribution of over 250 Tons of cocaine.

Michael C. Ruppert’s killer story theorizes that Lehder became the US Government’s cocaine dealer, distributing cocaine to countries around the world, as a means to raise quick capital, covert off the records, utilized to support covert CIA operations in foreign countries. All of these activities, mind you, were supposed to be run without the knowledge of our government officials or citizens.

Ruppert also posits that Lehder’s wife was a high ranking manager for AIG insurance in San Francisco and that Carlos himself was hiding in plain sight in the Bay Area (East Bay) for years; all the while citizens and officials connected to the case were led to believe that Lehder was incarcerated for life.

Is Ed on his way to Virginia to stand trial, is he incarcerated in Miami, is this just a computer glitch, or is it possible that Ed Okun has more connections than we realize? Could Okun be useful to our government in a way that would facilitate his release? A far fetched notion but in the scheme of the many conspiracies and realities within American history–not impossible.