ChicagoHomeBuyerCoalition.org

HOW TO AVOID A LAWSUIT AGAINST A DEVELOPER

After 10 years of a lawsuit against Bahary Development for fraud and defective construction, we finally settled. $200,000 later we end up with really nothing since now we have to rebuild the porch (condemned 4 years ago by the city) and build the parking. Right now condo owners have to park on the street.

 

In addition to that the value of the 12 condos  have gone down by at least 5% on the top of the general  price reduction due to a down market. 

 

So the question is: could I have avoided this nightmare?

 

At the time I was not a REALTOR so I did not know better. There are things I could have done if I had been guided correctly. I could have gotten a copy of the plans from the city and have an architect evaluate them.  In any case make sure that

 

1)   there won't be water intrusion.  For almost 2 years I had leaks in my bedroom to a point where I had to sleep in my living room  And I was not the only one with that problem.

 

2) the condo had reduced sound transmission.  Since most units were empty, there was no way to find out about sound problems.  But we discovered too late that there was no insulation between floors although we were told

there was..  Bring a friend and have him/her walk/talk in the unit above the one you want to buy and see if the sound is a problem.

 

3) to hire a structural engineer to check the building including the common elements and basement.  Such inspection is expensive but worth it if it will save you thousands of dollars later on.

 

4) to compare the original developer's plans with the one provided by the city: they should be the same. Many times a developer will cut corners during construction.  The plan should also be signed by a city inspector. 

 

5) to verify that all city inspections were done before, during and after construction. You can contact the city to find out.

 

6) to check the developer's history.  If units have been sold, talk to the new owners.

 

Remember until all units are sold the developer is acting as the Board of Directors for the association; a potential for conflict of interest.

Forrest David Laidley Charged with Allegedly Swindling Investors and Financial Institutions in a Multi-Million Dollar Fraudulent Financing Scheme

 

CHICAGO—A Libertyville, Illinois real estate developer, who offered and sold limited partnership interests and short term, high interest, guaranteed promissory notes to the public, was indicted by a federal grand jury yesterday and charged with mail fraud, wire fraud and bank fraud in connection with a scheme to fraudulently obtain, retain and use more than $10,000,000 from investors and financial institutions.

Patrick J. Fitzgerald, United States Attorney for the Northern District of Illinois, and Robert D. Grant, Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation, announced the return of the fourteen-court indictment against Forrest David Laidley today. In doing so, they also thanked Lake County State’s Attorney Michael Waller and his office for their assistance in the investigation.

Laidley, 65, of Libertyville, Illinois owned and operated Forrest Properties Inc., which was engaged in the real estate development business in the northern suburbs.

According to the indictment, Laidley through Forrest Properties fraudulently obtained funds from investors, financial institutions and others by misrepresenting the expected return on investments, the risks associated with investments, his ownership of property, his ownership of loan collateral, his financial condition, the status of investments and the use of proceeds obtained. The indictment further alleges that Laidley commingled the fraudulently obtained funds and at times misappropriated them to make ponzi-type payments to investors, to repay delinquent loans including bank loans, to benefit unrelated real estate development projects and to benefit himself.

According to the indictment, as a result of the defendant’s scheme, limited partnership interest investors and promissory note purchasers lost over $8,000,000.

If convicted, each mail fraud, wire fraud and bank fraud count carries a maximum penalty of 30 years in prison and a $1,000,000 fine, or the Court may impose an alternative maximum fine totaling twice the loss or twice the gain, whichever is greater. The Court, however, would determine the appropriate sentence to be imposed under the advisory United States Sentencing Guidelines.

The government is being represented by Assistant United States Attorney Edward G. Kohler.

The public is reminded that an indictment contains only charges and is not evidence of guilt. The defendant is presumed innocent and is entitled to a fair trial at which the government has the
burden of proving guilt beyond a reasonable doubt.

Department of Justice Press Release

July 23, 2009

Who Are The Bad Boys

By bad boys,I mean all the real estate developers or builders whose irresponsible actions and incompetence, have resulted in financial losses to YOU the new homeowner. If you have been the victim of fraudulent behavior and have a story to tell, make sure to know your facts. The ChicagoHomeBuyerCoalition.org and its board of directors are not responsible forthe opinions expressed in this section.

Please reserve the title section to identify the name of the company/developer/builder involved.