California
Exclusive: FBI searched California real estate firm linked to bad bank loans
Item 1 of 2 The podium for the director of the Federal Bureau of Investigation is seen at FBI headquarters in Washington, U.S. June 14, 2018. REUTERS/Yuri Gripas/File Photo
Sign up here.
On September 11, FBI agents searched Continuum’s Newport Beach, California, offices, law firm Paul Hastings wrote in a September 12 letter seen by Reuters.
Representatives for Continuum did not respond to emails and calls seeking comment. The FBI is an enforcement arm of the Justice Department. Spokespeople for the agencies did not respond to requests for comment. An attorney for Cantor Group said the firm upheld the terms of the Zions and Western Alliance loans and did not provide comment on the government scrutiny.
Allen Matkins, a law firm that represents other entities linked to Continuum, wrote in an October 2 letter that it learned on September 11 that certain of its clients were the subject of search warrants “in connection with a pending criminal investigation,” and that a grand jury had been convened in the case.
Prosecutors typically convene a grand jury when they intend to gather more evidence. The letters did not say which specific criminal authority was leading the case or what potential misconduct or individuals it was focused on.
Criminal investigations do not necessarily mean any wrongdoing has occurred and many do not result in charges.
Reuters is reporting the FBI search and probe for the first time. The government scrutiny could have ripple effects for what legal filings and public records show is a complex web of investors and lenders tied to Continuum’s real estate dealings, some of which are entangled in civil litigation.
Paul Hastings and Allen Matkins are representing parties embroiled in a complex real estate dispute. The letters relate to those proceedings. The Allen Matkins letter was disclosed in a California court.
When asked about the letter by Reuters, a lawyer for Paul Hastings said the firm was “working to unravel multiple levels of alleged fraud,” but did not provide more details.
Allen Matkins did not respond to calls and emails seeking comment.
PASSIVE INVESTORS
Zions on October 15 sued Cantor Group fund guarantors Andrew Stupin and Gerald Marcil, among others, to recover more than $60 million in soured commercial and industrial loans. The next day, Western Alliance flagged that it had sued the pair and a different Cantor fund in August to recover nearly $100 million.
Both suits allege key information was misrepresented or not disclosed, breaching the loan terms. Western Alliance also alleges fraud on the part of the Cantor fund.
Continuum acquires and manages distressed real estate assets for groups of investors, and its largest investors include Stupin and Marcil, according to a February arbitration ruling related to the real estate dispute. That ruling found Cantor “consists solely” of Continuum’s legal owner, Deba Shyam, and shares the Continuum offices. Shyam did not respond to calls and emails seeking comment.
Cantor upheld its contractual obligations and was transparent with its lenders, while the loans were audited and independently reviewed multiple times over the years, said the Cantor attorney Brandon Tran, who also represents Stupin and Marcil.
The pair are passive investors in Cantor and held no operational roles, he added. Cantor in legal filings has disputed that the Western Alliance loan is in default.
In a statement, Marcil said he had invested in several of Continuum’s properties. He denied wrongdoing and said that he was a victim.
Spokespeople for Zions and Western Alliance did not respond to requests for comment.
Reporting by Douglas Gillison and Chris Prentice; Editing by Michelle Price
Our Standards: The Thomson Reuters Trust Principles.
A 17-year-old suspect has been arrested in Texas in connection with the deadly shooting after a high school graduation ceremony in Fairfield, California last month, police said.
Fairfield police said U.S. Marshals, accompanied by department detectives, served search and arrest warrants Friday morning at a home in the greater Dallas-Fort Worth area.
The teen was taken into custody without incident on suspicion of murder and related offenses.
Investigators said the suspect fled California and traveled to Texas within days of the June 3 shooting. He will remain in custody while awaiting extradition to Solano County.
The shooting happened after Sem Yeto Continuation High School’s graduation ceremony, which was held on the Fairfield High School campus.
Police said 18-year-old graduate Jamario Baker died at the scene. Three others – an 11-year-old child and two adults, ages 20 and 25 – were wounded.
Authorities have not released the suspect’s name because he is a minor.
Although an arrest has been made, police said the investigation remains active and detectives continue to pursue additional leads.
“While today’s announcement may provide a measure of relief to some, it does not lessen the pain felt by our community,” the Fairfield-Suisun Unified School District said in a statement.
Police plan to hold a news conference Monday at 4 p.m. to discuss the case and arrest.
Fairfield is a Northern California city about 40 miles northwest of San Francisco.
A California bill would let insurers monitor customers’ driving data in exchange for discounted premiums.
Assemblymember Tina McKinnor, the author of AB 311, said the digital monitoring, known as telematics, rewards good driving and would improve safety. In real time, telematics technology would track data such as speed, location and how a vehicle is being driven.
“We have to slow people down,” McKinnor said. “That is the whole purpose for this bill, is driver safety.”
A voter-approved law from 1988, Prop 103, required insurance rates to be based mainly on driving record, miles driven and experience. It made California the only state in the country to prohibit telematics.
McKinnor believes the law is outdated. She argued that her bill would also help good drivers who pay higher rates because of where they live.
“Where I live definitely brings my insurance up,” McKinnor said. “If we both drive the same way, we’ll get charged the same way, instead of by our ZIP code.”
California’s Department of Insurance and consumer groups oppose the bill, citing privacy concerns.
“We can’t look behind the algorithm and see what weight it’s giving to different criteria, which is a big problem,” said Jamie Court, president of Consumer Watchdog. “Auto insurance, otherwise, is transparent. This is why the Department of Insurance is opposed, because of the lack of transparency in the algorithm.”
The proposed savings in exchange for good driving might not be guaranteed. Telematics data from the Maryland Insurance Administration showed that 31% of drivers who opted into the program saw a drop in rates, 24% saw an increase and 45% saw no change to their premiums.
“This collects an awful lot of data about people, more than they know, and it’s like having Big Brother in your back seat,” Court said.
McKinnor insisted that drivers will not be forced to enroll in the program.
“It’s still opt-in in the other 49 states,” she said. “We’re not going to make this mandatory. It’ll be a per-volunteer situation.”
McKinnor’s bill passed through the legislature’s insurance committee. It’s expected to be presented to the full Senate in August.
Huntington Beach police are vowing to prevent a potential “takeover” event being promoted across social media that they believe could get out of control.
Police said they became aware of the event from a flyer online advertising an “end of summer beach bash” in the city.
“Dear ‘Beach Bash’ organizers…” police said in an Instagram post Thursday. “Thanks for the flyer. We’ve seen it too.”
They continued, “We have no intention of allowing that to happen here.”
No further details were provided about when the event was planned to take place or the exact location.
Police and the city of Huntington Beach said they’re working to prevent the event following similar events in Southern California that resulted in violence, vandalism and other criminal activity.
One chaotic event that was held in Newport Beach on the Fourth of July ended with more than 400 people being arrested, according to police. Some partygoers were seen fist fighting, while others allegedly vandalized property and local businesses, including a Pavilions grocery store.
Newport Beach police said social media posts drew a large influx of people to Newport Pier in a short amount of time, and the event got out of control.
Huntington Beach PD warned that anyone who organizes, promotes or participates in criminal activity associated with a takeover event may be arrested or prosecuted. Charges may include incitement to riot, vandalism, theft, assault, reckless driving, unlawful assembly, conspiracy or other applicable offenses.
They also warned that juveniles would not be exempt from punishment, and parents or guardians may also be liable for damages caused by their child’s actions.
The HBPD Special Investigations Bureau has already identified individuals believed to be involved in organizing and promoting the event, according to police.
If you have information regarding this event, you are urged to contact Huntington PD’s Special Investigations Bureau at 714-536-5991.
-
Atlanta, GA42 seconds agoAtlanta Hawks Showing Interest In Denver’s Peyton Watson, But Is The Price Too High?
-
Minneapolis, MN6 minutes agoUptown businesses push to delay Lyndale Avenue project
-
Indianapolis, IN13 minutes agoData center moratorium proposed by Indianapolis City-County Council president
-
Pittsburg, PA16 minutes agoPopular Pittsburgh food truck Street Fries opens South Side restaurant
-
Augusta, GA21 minutes agoMan charged with murder in shooting death of Augusta woman
-
Washington, D.C28 minutes agoASGCU leaders celebrate country’s 250th birthday at national conference – GCU News
-
Cleveland, OH31 minutes agoWanted sex offender arrested at the same Cleveland home where missing Tennessee mother found dead
-
Austin, TX36 minutes agoTexas Has One Trait Almost Every National Champion Shares
