Nevada County DA Took Special ‘Hard Money’ Loan Favors

Nevada County DA Took Special ‘Hard Money’ Loan Favors

His personal finances in disarray and his ability to do his job compromised, Nevada County District Attorney Clifford Newell sat in a local cafe, eyes welling, as he described how he became beholden to a loan broker who is under investigation for bilking investors.A few years ago, Newell and his wife assumed crushing debts to keep their summer camp business solvent. Unable to get a conventional loan — “Neither of us were qualified,” Newell said — they borrowed from what is called a “hard money” broker, the equivalent, some say, of a legal loan shark who uses others’ money to make high-priced loans.

That decision inextricably linked Newell, the county’s top law enforcement officer, to Philip Lester. That hard money broker has since been accused by investors of cheating them, leading to investigations by police, and now the state attorney general’s office, for securities fraud.

A yearlong Bee investigation found that Newell, 54, received favorable treatment on his own loans from two hard money brokers. Documents show that one of them, Lester, tried to help the Newells avoid foreclosure and possible bankruptcy by raising money for a loan and misleading investors who contributed.

To finish the rest of this article posted by Alex Ferreras on June 6, 2011 Click here

Posted in Private Lending.