Ed Okun Victim Cautions LandAmerica Victims, Challenges Government, Admonishes 1031 Exchange Industry

Note of Disclaimer: The following comment, story, and opinion(s) are that of the commenter Elizabeth Callanan and not that of deansguide or the author of deansguide Dean Guadagni. Those of you who have read this blog in the past know where I stand. I am a victim’s advocate and simply creating a place for victims or industry pro’s to communicate.

The following are opinions, experiences and stories of the trials and tribulations of the 1031 exchange industry from long time contributor and commenter Elizabeth Callanan one of the 350 “Trainwreck Victims” of the Ed Okun 1031 Tax Group Ponzi scheme. This is a warning, it is a plea, and it is her argument for the complete overhaul of the 1031 exchange industry–or it’s outright Abolishment.

Note: Not all of the 1031 exchange companies are bad, fradulent, or subversive. There are well respected, honest, and worthwhile 1031 exchange companies doing business.

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To Daniel Lowe and the other victims of the LandAmerica debacle,

You have my most heartfelt empathy.
Having been myself a victim of Ed Okun’s embezzlement of exchangers funds on deposit with the 1031 Tax Group, I truly feel your pain. I’m not an attorney, an accountant, and have no expertise apart from what comes of painful firsthand experience. It was in the hopes of warning other potential exchanger/victims that I started posting on Dean’s List and elsewhere.

At the end of the day, though, I agree totally with Yaco Tiamo, who has posted here. The entire 1031 industry is superfluous and that aspect of the IRS’ 1031 regulations should be expunged. It is a wildly unregulated industry that answers to no government oversight at any level (apart from some half-hearted oversight incorporated in a couple of recently enacted regs by a handful of states (Nevada, California?) and, as evidenced, by the recent spate of embezzlements or gross mismanagement puts all exchangers at great risk for no good reason. Doing a 1031 isn’t brain surgery. The forms are pretty standard and the process pretty simple, really.

Since the IRS has shown no interest in overseeing, licensing, demanding accountability from, providing meaningful insurance for (as the SEC does) or otherwise regulating the industry it created, it should kill it – NOW!

As to the LandAmerica victims, my (personal, not professional!!) advice in terms of investing in legal help is two-fold and in both cases I would act only collectively (except for those whose funds were held in traceable segregated accounts, who will no doubt make a serious (and perhaps successful) run at retrieving those funds, I see little point in acting individually — certainly not in bankruptcy, a self-funding and self-perpetuating legal and financial train wreck for everyone involved except the court appointed functionaries. (If you want to see the extent to which such a process can drag on ad nauseam with many billable hours just check out the history of the 1031 Tax Group case on either of these sites: http://www.committeeinfo.com/1031/index.htm (the official website for our Creditors Committee) or http://trustee1031taxgroup.com/component/option,com_frontpage/Itemid,1/ (the Trustee’s website).)

However, I WOULD hire a legal firm (on contingency if you can – since, by definition, you no longer have any money!) to:

1) GET YOUR CASE OUT OF BANKRUPTCY COURT!! That is a deep dark hole that will suck up every dime of funding available until there’s nothing but dust left. In the 19 months since Ed Okun put the 1031 Tax Group into “bankruptcy” (it was a criminal embezzlement plain and simple now being tried in a US Federal Court in Richmond which was known at the time the bankruptcy was filed in May 07 — the Feds having raided the offices in April 07 — and should never have been accepted as a legitimate bankruptcy to start with!) all of the various court-appointed functionaries have claimed MORE THAN $30 MILLION IN SO-CALLED “ADMINISTRATIVE FEES” and victims have received not one penny of their escrow funds. In fact, in an amazingly brazen and twisted miscarriage of justice, the Bankruptcy Court authorized attorneys for the so-Called “Debtors” (ironically the Dreier firm whose owner embezzled millions in escrow funds himself) to pursue a legal action to retrieve the only escrow funds that Okun himself had not been able to steal and the settlement cozily agreed to by the attorneys on both sides (and approved by the Court) provided for payment as well to the attorneys DEFENDING the bank where those funds were on deposit — the end result of which is that the costs of BOTH SIDES of that court case will be paid by Okun’s victims. (So, to our point of view we were mugged first by Okun and then by the Bankruptcy Court!) The only way to get that Bankruptcy action derailed is to get the Committee itself on board (not easy since the Committee’s attorneys will understandably vehemently argue against the prospect of losing their cash cow), but I’d consider that a first priority.

2) Get a class action going to pursue all the parties involved, including especially LandAmerica to force them to use the proceeds from the sale of its other two arms to repay the exchange funds it squandered on worthless investments.

I sincerely hope you are more successful than we’ve been to date in retrieving even a dime of our life savings. The key is acting collectively and getting a junkyard dog of an attorney who is willing to work on a contingency (which means you’ll get 25% less than you otherwise might, but most of Okun’s victims would happily settle for that today!). Unfortunately in bankruptcy there is absolutely NO incentive for settling anything quickly. It’s all about billable hours — for attorneys, for management companies, for accounting firms, and all the other hangers-on who can get their licks in. If I were you, I’d follow the lead of the creditors in the Southwest Exchange Case – which happened just a few months prior to our’s and in which there’s been a settlement of $92 million of the $97 million lost (minus the contingency and other costs incurred by the attorney) while WE HAVE NOTHING and dismal prospects ahead.

You’ve gotten off to a better start than we did, it appears. You have a website (noted above by one of your fellow victims), your Committee seems to communicate with you (our’s has maintained a nearly absolute silence and shares NO information whatsoever for reasons none of us can fathom), and I understand you’re collectively discussing a civil class action which I encourage you to pursue.

Good luck to you all — sincerely.

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Blogging Realtor’s New Content Tip: Blog Article “Mashup” Provides Variety and Measurement

The mashup content post is a concept that combines 3 subjects, in tip or list format, in one blog article. Today’s first edition will provide 3 tips on 3 different subject categories: Anchor Text, Social Media Construct, and Focus and your plan.

Mashup Article Benefits:

1. Variety for the writer and reader

2. Measure your reader’s enthusiasm for each subject with traffic analytics

3. Valuable information in multiple areas

Tip #1 Anchor Text:

Anchor text is according to Wikipedia “is the visible, clickable text in a hyperlink.” According to Marilyn at Seoshootout.com you will “Improve your SEO and build relevant anchor text by using an important keyword as the hyperlink – preferably linking it to another, relevant page on your site or linked to an external site that is relevant.”

Ex: SEO Shootout is the premeire SEO blog in the blogosphere

Tip #2 Social Media Construct: Chris Brogan-Darren Rowse featured by James Helm’s todaysbesttools.com

Here is a great description of the construct for Soc Media sites

a.) Blog is Home where all sites should point and all readers funneled

b.) Outposts (Darren Rowse) “are third party sites where he creates “Relationships, ideas, traffic, resources, partnerships, community and much more emerge from the outposts” Darren’s idea is a powerful method to multiple points of exposure for the blogger

c.) Frontiers (Kyle Lacy) feels these are “a website or service you have a presence on but rarely go.”

Tip #3 Focus

According to James Helms the best method to stave off burnout and feelings of overwhelming angst over the massive crush of available social media sites and tools is to consider the following:

“When it comes to social media don’t focus on the tools before the goals within your strategy. Said another way, first focus on your campaign and then leverage available tools that help you meet your goals.”

Great advice and very important to remember–your efforts to leverage tools is useless if you don’t stay connected to your planned campaign

Courtesy of James Helm’s todaysbesttools.com and inspired by Chris Brogan, Darren Rowse, Kyle Lacy and James Helms

5 Strategies to Branding “You”: Realtor’s Guide To Career Success

Branding "You" to be memorable

Branding

Reuters.com published this deansguide article September 2, 2008

What exactly is the definition for the word “branding”? We are talking about creating an aura, a perception, and a truth about a person, service, or product that allows people to identify and recognize them instantly.

Branding according to Whatis.techtarget.com definition

Branding “You” What Are You Waiting For?

You spend a lifetime promoting your employer, their products, and their services. You derive your substance factor from your experiences. Is it not about time you tell the world about you and why you are special?

Tips To Branding “You”

1. Recognize: You are a brand. You have recognizable qualities and you must consider yourself special in order to promote your unique qualities

2. Begin the Shift: Recognize you are worthy of brand recognition and begin to shift the emphasis to your qualities and differentiating factors that make you unique. Why are you so effective? How can you deliver value? Begin to market you as the source

3. Education to Expertise: in order to become a brand, you must be knowledgeable in your niche. Gain confidence and expertise by studying and learning about your business from mentors, online resources, workshops, seminars, and books. Building your knowledge base builds confidence in you as well as your potential clients

4. Writing Platform: create a writing platform with the goal of establishing your own blog within a 3-6 month period. The following are places to start:

a.) Submit articles to ezinearticles.com

b.) Create a newsletter

c.) Become a contributor to a blog

d.) Ask to contribute to a newsletter or local newspaper

5. Public Speaking Platform: Create a workshop or speech aimed at providing value to your audience.

a.) Ask to represent your company at local meetings or conferences. Work up to bigger venues

b.) Ask to speak at your Kiwanis Club, Rotary, or Chamber of Commerce

c.) Create a Free workshop for you affiliate partners

d.) Join a industry organization and submit your request to speak

Results

The best strategy to support your career as an entrepreneur or as an employee of a company is to create the brand of “You.” In so doing, you become recognizable to both potential clients and potential employers.

Your entrepreneurial business is positively effected when potential clients know you, like your brand (You), and understand the value you bring to the table

Your employer’s business is positively effected when customers know you, trust you as their “brand”, and understand the value you bring to the organization you are working for with the client’s best interests in mind

Realtors “Measure” Your Success For An “Unfair Advantage”

FoxBusiness.com published this deansguide article on August 5, 2008

Guy Kawasaki talks about the differentiating factor in a business being that businesses “unfair advantage.” The one person, product, or service that nobody else in the niche or industry can duplicate or “touch.” This must be quantifiable and measurable in order to illustrate the true value to the market.

Lawyers measure their success, in many cases, through their percentage of wins in the courtroom. Professional baseball players measure their success through their batting average or wins. Chefs measure their success through restaurant reviews and Michelin stars.

Here Is The “Salesperson’s Problem

Unfortunately sales people often measure their success by pointing to their sales volume, innocuously siting vague buzzwords like “value add” and attempting to push the idea they are experts without providing any objective outside source for validation

Examples of “Old School Hard Sell” Measurement

When Realtors utilized their promo, marketing, or ad materials they often site the following “reasons” for consumers to blast down their doorway:

1. Sales Volume: Sales volume does not equate to salesmanship, customer service, or expert knowledge. Selling big volume can be, and has been in many cases, the product of nepotism, favoritism, smoking white hot markets, and the always present hard work

2. Top Producer: Brokerage top producer logo’s and marketing materials are an attempt to impress consumers by showing experience and effectiveness WITHOUT really showing anything of detailed substance

Top Producer “tags” are only relevant to a consumer if you can negotiate a great price to sell their home or help them buy a home. It is more relevant if you can show properties before they hit the market or warn the consumer about a problematic area

Differentiate Through Measurement?

1. Find Measurement: Find a stat that consumers can understand and appreciate. One that they find value in and believe is helpful to their needs

Differentiating Measurements

1. Sales Dollars Below Asking: Why not keep a running spreadsheet on sales dollars below asking? Or find a measurement that will describe your ability to negotiate and save your clients money

2. Go-To Source Before Market: Can you find great properties and offer a full list of properties no other agent can offer to consumers? Can you do this prior to the property coming on the MLS? Can you be perceived as a go-to source of information? How about a stat you keep of the number of properties you sold that were not on market as a method of showing your ability to bring more to the table?

3. Transaction Savings: Is their an affiliate relationship that you can leverage that brings dollar savings to your clients? If so can you total the dollar amount into an impressive measurement tool that shows how consumers benefit by doing business with you?

“Green Economy” Powerhouse Van Jones To Speak At Commonwealth Club In San Francisco

Van Jones Headshot

Van Jones

Van Jones is one of the most powerful men in the drive to bring economic relief and prosperity to inner city citizens through the new opportunities growing out of the green movement.

Green for All founder Van Jones and California State Senator Darrell Steinberg team up with the Commonwealth Club of California’s INFORUM division to present “Who’s Building The New Green Economy?” This discussion is characterized as a “timely discussion about the intersection of environment and economy.”

Real Estate Professionals and Affiliates

For any mortgage broker, Realtor, broker, builder, or construction affiliates this discussion will shed light on where the profits are going, the funding is being spent, and the niches that are being created.

Place

The Commonwealth Club, commonwealthclub.org, 595 Market Street, San Francisco

Date and Time

Thursday July 24, 2008 6:00pm

What Is Web 2.0: The Best Tutorial For Any Level Of Web 2.0 Understanding

What is Web 2.0? This is one of the best videos I have ever seen in explaining the timeline and players involved in this revolution. It may seem a bit stark in presentation, but make no mistake about it–you should watch this clip. This is a great introduction and will give most people a wonderful beginning start point.

Think you don’t need a start point, don’t need to learn something you know, or don’t have the time?

Trust me-this is the most painless way to understand what you must understand to move forward in the ever changing world revolution that is Web 2.0

10 Chracteristics Of A Great Realtor: If You Don’t Have These Skills You Are “Selling” Yourself Short

FoxBusiness.com published this deansguide article July 7, 2008

Please read this article then refer to this fantastic historical blast through Web 1.0 to Web 2.0 by Mike Wesch

What do you do if you are ready to address a new prospect and the first thing out of their mouth is: “I don’t know if I really need a Realtor”? Are you prepared for that statement or have you comforted yourself with the idea that 99.99999% of the consumers at large understand the value of a Realtor during a real estate transaction?

The Idea Simply put you should think of your job as:

1st an educator

2nd a sales person

Sales Perspective #1

NEVER ASSUME anything. Consider the idea that you should have the attitude that you need to sell your prospective client on the benefits of representation. Do not think that just because they found you, they are sold on paying you thousands of dollars for the priviledge of doing business with you

Help them understand the safeguards YOU bring to the table in these shaky economic times and era of mortgage meltdowns

Safeguards?

1. You are an expert at contracts, interpreting contracts, and explaining all aspects of the contract to clients

2. You are the informational expert for your county, city, town, region, or neighborhood

3. Although you do NOT have to be, you are an EXPERT in mortgages, appraisals, and credit issues. If need be you could perform your affiliates job with ease

4. You understand home inspections and their importance

5. You have a “team” of affiliates who have the same “educator-expert-sales” approach

6. You are a technologist and understand the marketing importance of blogging, Google search, and viral marketing tools for maximum exposure

7. Your broker supports your efforts 110% with real world marketing-ads in local, regional, and national publications (when necessary)

8. You are AVAILABLE to answer questions

9. You have connectivity aka you are networked into the communities political structure, industry hierarchy, and familial community outlets

10. Your reputation is your calling card. “It’s who knows you-NOT who you know” that counts