Suits question real estate transactions

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LaKenya Barthelemy wishes she had listened to her mother.

Ernestine Evans was suspicious of the claims that S.D.A. & Associates would help her daughter and son-in-law, Ernie Barthelemy, sell their East Pine Ridge Drive home and get the family out from under a mortgage they couldn't afford. But they signed up with S.D.A. in March 2007, moved back home to Louisiana and gave owner Regina Preetorius power of attorney to deal with the house.

"That was the last time we talked," Mrs. Barthelemy said from their current home in Vidalia, La.

She never knew of the sales contract Kathryn Heath signed in September to buy 1545 E. Pine Ridge Drive for $174,900 from S.D.A. Mrs. Barthelemy didn't know Ms. Heath paid $10,000 down and gave S.D.A. an additional $10,800 in monthly payments until the Barthelemys' mortgage holder foreclosed and evicted Ms. Heath in April.

The Barthelemys lost about $10,000 in equity they had in the home. Ms. Heath lost her down payment. And an investor who put up $50,000 in exchange for a security deed on the house probably won't get any of her money back either.

What happened with 1545 E. Pine Ridge Drive was repeated over and over by Ms. Preetorius.

Three lawsuits have been filed against Ms. Preetorius accusing her of fraud and racketeering, and a number of people The Augusta Chronicle talked to who had dealings with S.D.A. say they, too, will be contacting attorneys.

HERE'S WHY: According to the lawsuits and those who talked with The Chronicle , instead of helping people catch up with mortgages or sell their homes, Ms. Preetorius treated the property as her own and obtained second and third mortgages on the houses. Investors gave S.D.A. money in exchange for security deeds on the properties. The investors' security deeds are worthless, however, if the original mortgage lender forecloses and the equity in the house can only pay off that loan. And when the original mortgage lender forecloses, anyone living in the home is evicted.

That's what happened on East Pine Ridge Drive. When the Barthelemys' mortgage holder stopped receiving monthly payments on the house, it started the financially devastating chain reaction.

In S.D.A.'s wake are more than 40 foreclosures, 12 involving Ms. Preetorius or her various business entities, and about a dozen people who went bankrupt. By the time Ms. Preetorious and her husband filed for Chapter 7 bankruptcy Aug. 4, she had been involved in the transfer of properties with a combined fair market value of more than $10.6 million. She had also persuaded investors to give her nearly $3.7 million in exchange for security deeds on properties.

Georgia law requires licenses to sell real estate and securities. Ms. Preetorius has no professional license, according to the secretary of state's records.

Jeff Ledford, the commissioner of the state's Real Estate Commission, said the law allows a person to buy and sell property for their personal investment, but no one can use the exception to get around the law that requires a real estate license.

Obtaining power of attorney isn't a normal step in real estate transactions, Mr. Ledford said. A licensed real estate agent could lose his license if he misleads a buyer about his own personal involvement in a transaction.

There's another step needed in real estate transactions: the seller's mortgage lender must be notified.

A spokeswoman for Wells Fargo Home Mortgage, which has foreclosed on at least three properties Ms. Preetorius has obtained, had this to say:

"If ownership of the property is transferred without the lender's consent, depending on the circumstances, the entire loan can be called due," said Debora Blume, who works for Wells Fargo's communication department in Des Moines, Iowa.

In an e-mail response to questions from the newspaper, she wrote, "Wells Fargo can't comment on whether this property transaction was proper, because we had no knowledge of the transfer. However, had we been contacted, we probably would not have consented."

S.D.A. touted itself on its Web page as "a multi-service company who has the ability to BUY, REPAIR, MARKET, and SELL HOMES ... We are problem solvers who can make your monthly mortgage payments evaporate."

A number of those who became involved with the company told The Chronicle that they were impressed with the Christian attitude of the business. They were also assured of the legality of what they were told inside the Reimer law firm where Ms. Preetorius shared office space, they told the newspaper. There were real contracts, real deeds filed in counties' official property records. Neither the Better Business Bureau nor Chamber of Commerce listed any bad marks against the company.

State and federal law enforcement officials report no open investigation of S.D.A. The Chronicle learned of Ms. Preetorius' business earlier this year when stories such as Ms. Heath's came to its attention through court hearings and records checks.

Attorney Pete Theodocion, who is representing Ms. Preetorius in two of the civil lawsuits filed against her, said his client has done nothing wrong in the cases he knows about. He said she got caught short by the crash in the real estate market.

In an e-mail response to the newspaper, Ms. Preetorius said she believed it was best to follow her attorney's advice and not talk with the newspaper.

Attorney Sue Reimer, who shared office space with Ms. Preetorius and assisted with the land deals and incorporation of her various businesses, according to state and county legal documents, would only say, "We are not associated with them any more."

Ms. Preetorious has had several businesses: Southeastern Holding Group, R.M.P. Holding Group, S.M.B. Holding Group, A.C.B. Holding Group, D.T.B. Holding Group, Preetoria Inc., and Omega Holding Group. The only business still licensed is S.D.A.

Lathaniel Harris knew Ms. Preetorius through S.D.A. He signed a lease-purchase contract with her on June 21, 2006, for a small, three-bedroom home on Old Highway 1.

Ms. Preetorius told Mr. Harris and his wife that S.D.A. helped people own homes, he said. They signed a lease-purchase agreement and a second contract, a "sweat equity agreement." In exchange for repairs and upkeep, S.D.A. would knock $4,200 off of the $85,000 price tag.

The Harrises and their four children, newborn to 12 years old, thought of the home as their own. They made plans to add another room, Mr. Harris said.

But then a county marshal showed up on the doorstep this summer with an eviction notice.

Wells Fargo, which provided a $58,610 mortgage for the home purchase in 2002, foreclosed on the property in April when it stopped getting payments.

On paper, S.D.A. owned the home. Ms. Preetorius obtained power of attorney from the original owner and transferred the title to S.D.A. in 2005. She gave an investor a $40,000 lien on the house.

Mr. Harris said Ms. Preetorius first told him not to worry because she would fight the mortgage company. Then she stopped taking his calls, Mr. Harris said in June as he stood in the front yard, wondering out loud how he was going to find another home for his family.

On Friday, he was still trying to find a place.

"The only thing they were doing was helping themselves," Mr. Harris said.

WHEN MS. PREETORIUS MET with Barbara Ring to explain how her company worked, Ms. Ring was assured that under Georgia law, the security deeds she would get for her $100,000 investment were indeed secure, Ms. Ring said. She was told the worse thing that could happen was she would end up with the property. Because they were sitting in a lawyer's office, she took the statement as true. The 12 percent return Ms. Preetorius proposed didn't seem too good to be true because she already had an investment paying 9 percent, Ms. Ring said.

She got interest checks for five months, then nothing. Her money was sunk into a $1.85 million home in Duluth in Gwinnett County. Property records show it is owned by S.D.A. but is in foreclosure.

Ms. Ring is one of 108 potential unsecured creditors listed on the Preetorius bankruptcy petition. The court will have difficulty notifying Ms. Ring of any proceedings, however, because Ms. Preetorius gave the court a wrong address for Ms. Ring.

Ms. Ring retired after selling antiques for 38 years, but she has to reopen her shop and sell off her personal antiques because of the $100,000 loss.

"I thank the Lord every day that I have these things. I may have an empty house when I'm done, but I'll have some money in the bank to start over," said Ms. Ring, who is nearly 69.

ARTHUR M. KENT invested with S.D.A. in November 2006. He filed suit last month seeking his $50,000 investment. He alleges the deal with S.D.A. was fraudulent and that he is entitled to punitive damages as well.

Mr. Kent's lien is on 4070 Pinnacle Way in Hephzibah. Not only did another investor have a $40,000 lien on the same home, First Franklin Financial Corp. has the $153,900 first mortgage on the property and filed notice of foreclosure after Ms. Preetorius got control of the house.

Richmond County property records lists S.D.A. as the owner. In 2005, the owner was in foreclosure when he gave Ms. Preetorius power of attorney for the house, now valued at $185,580. She transferred ownership to S.D.A. six days later.

As with all of the property records involving Ms. Preetorius, her husband and her mother, Marie Champagne, Ms. Reimer or the lawyer's staff was involved with the transfers.

Ms. Champagne was convicted in 1989 of mail fraud for her role in a multi-state scam that promised million-dollar loans to businesses through her service, Financial Business Brokers Inc., according to reports in The Chronicle . She was sentenced to two years in prison and ordered to pay more than $800,000 in restitution.

Michael Rollins hired attorney Daniel Wright McLeod to get his Evans home back from S.D.A. Mr. McLeod was successful in February, but Ms. Preetorius had already exchanged a $25,000 security deed on the home with an investor.

Mr. Rollins worked out a payment plan with his mortgage company and stopped a foreclosure action.

If Mr. Rollins had lost the house in foreclosure, he would have had no obligation for the $25,000 security deed on the house. But since he has the property, he might be responsible for the $25,000 Ms. Preetorius got from an investor.

"Now that means we have to fix this," Mr. McLeod told Mr. Rollins, a military contractor who was in Iraq when his wife made a deal with Ms. Champagne to market and sell their home.

Andrew Sumpter had a similar agreement with S.D.A.

The Army veteran serving in South Korea and his ex-wife, who is on her second tour of duty in Iraq, gave Ms. Preetorius power of attorney in October 2005 for their Breeze Hill Drive home. Mr. Sumpter said he met with Ms. Champagne and signed a contract that stated he and Alester Sumpter were relieved of their mortgage obligation because S.D.A. would assume the loan. He thought everything was over until a chance check on his credit report in December 2007. The mortgage company hadn't received any payment for the past three months.

The Breeze Hill Drive home is in S.D.A.'s name, and until recently it was occupied by a couple who paid a $6,700 down payment and $1,000 a month as required by their lease purchase contract.

Property records show an investor gave Ms. Preetorius $11,000 in exchange for a lien on the property.

"The only thing I seem to own is the loan," Ms. Sumpter said. "All she did was sell us a bunch of lies."

Mr. Sumpter and his ex-wife are listed as potential creditors on Ms. Preetorius' bankruptcy petition. The court might have trouble keeping them up to date on proceedings. The address Ms. Preetorius provided for both Sumpters is 3016 Breeze Hill, the $124,280 home they turned over to Ms. Preetorius nearly three years ago.

MS. PREETORIUS DID PAY some homeowners for their properties. She bought an Albemarle Court home in November 2004, possibly sparing the owner from property foreclosure.

According to property records, the house is now owned by the Richmond County Homeless Animal Trust. An investor holds a $15,000 lien on the house, and a mortgage company has initiated foreclosure proceedings against Ms. Preetorius.

She and her husband have defaulted on more than $2.5 million in various mortgages, according to court and property records.

The Preetoriuses, however, claim only a total of $2.47 million in liabilities, according to their bankruptcy petition. They did not count the investors holding security deeds, or the property sellers and buyers.

They list zero assets and state their only income is unemployment compensation and child support payments, according to the bankruptcy petition.

The Albemarle Court home is listed with foreclosed property, along with 16 other houses that appear in property records as owned by various entities, including the Columbia County Wildlife Trust and the Coweta County Disabled Veterans of Desert Storm.

One of the properties missing from the list is the Breeze Hill Drive home the Sumpters once occupied. According to Richmond County property records, it is owned by S.D.A.

According to the bankruptcy petition, the Preetoriuses intend to contest any claims brought by any of the listed buyers or sellers, such as the Sumpters.

Mr. and Mrs. Barthelemy are on that list, too. Mrs. Barthelemy said they sought Ms. Preetorius' help when she became pregnant with their third child and lost her job. They considered filing for bankruptcy then, but thought the sale of their home would spare them. "She led us to believe she was an agent who helped people get out of houses they couldn't afford," Mrs. Barthelemy said. "I was crazy and took her word for it."

Reach Sandy Hodson at (706) 823-3226 or sandy.hodson@augustachronicle.com.

WHAT'S NEXT

On Aug. 28, American Home Mortgage Services will ask the bankruptcy court to allow it to proceed on its foreclosure of Regina and Charles Preetorius' Windmill Lane home. The bank claims

it hasn't received a payment on the couple's $567,000 mortgage since September.


On Sept. 3 at 9 a.m., the bankruptcy court will hold the first hearing for the Preetoriuses and any potential creditors.


In less than four years, Ms. Preetorius, through various business entities, has had control at some point of the following:


- 30 houses in Richmond County, total value about $2.79 million


- 19 houses in Columbia County, total value about $3.83 million


- 3 houses in Henry County, total value $697,500


- 1 home in Clayton County, value $193,062


- 1 home in DeKalb County, value $203,800


- 1 home Gwinnett County, value $1.85 million


- 1 home in Coweta County, value $882,035


- property in McDuffie County, value $127,390


- property in Burke County, value $50,000

Source: County property records: value is listed fair market value

Comments (142) Add comment
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justus4
99
Points
justus4 08/17/08 - 07:06 am
0
0
Now what kind of legal mumbo
Unpublished

Now what kind of legal mumbo jumbo happens next? A serious crime is documented in the article (and their evidence is always 100% correct) citizens were defrauded, thousands of dollars lost, but what punishment do such criminals deserve? The sad fact is, that Preetorius has beaten the system (designed by individuals to do just that) and the prosecutor will say, "we are sorry, but thats the law." Ha! This crime is worst than low-level criminals but probably face no jail time, which can be intrepreted to mean: just don't get caught. The homeowners first mistake was to believe in doing the right thing... It used to be good advise.

politicallyNcorrect1
0
Points
politicallyNcorrect1 08/17/08 - 07:22 am
0
0
Here's why we don't have

Here's why we don't have tougher laws to stop craph like this ! WHAT ORGANIZATION DOES THE CRIMES BELONG TO? THE NFL-NBA-ETC...36 have been accused of spousal abuse 7 have been arrested for fraud 19 have been accused of writing bad checks 117 have directly or indirectly bankrupted at least 2 businesses 3 have done time for assault 71, repeat 71 cannot get a credit card due to bad credit 14 have been arrested on drug-related charges 8 have been arrested for shoplifting 21 currently are defendants in lawsuits, and 84 have been arrested for drunk driving in the last year Can you guess which organization this is? CONGRESS !!! The same group of Idiots that crank out hundreds of new laws each year designed to keep the rest of us in line. You oughta pass this one on! up yet? . Scroll down,

NEone
6
Points
NEone 08/17/08 - 07:53 am
0
0
Scum.

Scum.

tdp
0
Points
tdp 08/17/08 - 08:38 am
0
0
People like this who defraud

People like this who defraud others make me sick. This person, as well as any others involved, deserve massive jail time. Unfortunately, they will probably get off with just a slap on the wrist.

bigjimjohntowns
0
Points
bigjimjohntowns 08/17/08 - 08:59 am
0
0
If it sounds to good to good

If it sounds to good to good to be true, it probably is!

bigjimjohntowns
0
Points
bigjimjohntowns 08/17/08 - 09:00 am
0
0
No Justus, the home owners

No Justus, the home owners first mistake was buying something they couldn't afford!

Batman
18
Points
Batman 08/17/08 - 09:28 am
0
0
this is why you should use a

this is why you should use a licensed realtor.

Captain Obvious
0
Points
Captain Obvious 08/17/08 - 09:51 am
0
0
The mess could have been

The mess could have been avoided if the homeowners had contacted their banks to make sure that Ms. Preetorius had actually paid the houses off. Funny how they just took her word for it...

Or just followed the advice here:
http://chronicle.augusta.com/ystories/081708/met_469803.shtml

Farful
7
Points
Farful 08/17/08 - 10:03 am
0
0
you pays your money and you

you pays your money and you takes your chances

fighterzack
4
Points
fighterzack 08/17/08 - 10:24 am
0
0
You should always deal with a

You should always deal with a licensed realtor, and lender. Check with the Georgia Department of Banking, and the Better Business Bureau before doing anything this serious with your home. Or even call another realtor or lender and ask their opinion before you do something like this. Unfortunately, bad people will always find a way to slip through the cracks and if their intent is to steal, they will find someone that will not check up on them.

mdottt
0
Points
mdottt 08/17/08 - 12:06 pm
0
0
from painting numbers on the

from painting numbers on the curbside to fraud. what a shame.

atwitsend
5
Points
atwitsend 08/17/08 - 01:36 pm
0
0
Ms. Preetorius and her

Ms. Preetorius and her husband belong in JAIL. Period. End of story.

And what happend with Ms. Champagne's sentence? Did she serve two years in jail for her crime and/or pay $800 K in restitution?

What a family! THIEVES...every last one of them!

Little Lamb
45332
Points
Little Lamb 08/17/08 - 02:05 pm
0
0
The mortagees think they

The mortagees think they "LOST" their down payment. They don't realize that a down payment is not like a savings account that belongs to you. When you sign away your home for someone else to sell, that down payment goes with the home. So far, I don't see where Preetorious did anything wrong. I'll go back and re-read it.

they call me pete
0
Points
they call me pete 08/17/08 - 02:18 pm
0
0
I ran a mortgage office

I ran a mortgage office locally for a few years when Preetorius showed up one day with a load of files she wanted me to look at for loans. Before she could get half of her spiel out, she was out the front door. Anybody that dealt with her is a crook. It was that obvious what she was doing. I called the Ga Banking Commission, but this was years ago. She is a total cheat and a liar. Champagne is her mother. To be honest, I don't think her husband ever really knew what was going on.

jack
10
Points
jack 08/17/08 - 03:01 pm
0
0
NEVER make deals on your

NEVER make deals on your property unless with a licensed broker/Realtor. Realtors in this area I have found to be lazy, however, especially when listing a property for sale. You should deal with more than one realtor to get an accurate market analysis.

dani
12
Points
dani 08/17/08 - 03:34 pm
0
0
Never forget ...."There's a

Never forget ...."There's a sucker born every minute" (often attributed to PT Barnum). Nowadays it is many more than one a minute.

Cody_Webster
0
Points
Cody_Webster 08/17/08 - 04:06 pm
0
0
Power of Attorney, let's

Power of Attorney, let's discuss Power of Attorney, the United States Social Security Administration will not accept it in dealing with someone's case, even if they are your relative. Numerous other government facilities might or might not accept it, so why the heck will a financial lending institution take it and loan out thousands of dollars to a third party. The bottom line of their business, that's why. They don't care, it can be written off later as a default.. Thief is as thief does...

dani
12
Points
dani 08/17/08 - 04:50 pm
0
0
Idiots who don't investigate

Idiots who don't investigate before investing is asking to be scammed. Surely in this day and time with all the warnings people in the news one can do better than be taken for a fool.

bigjimjohnstownes
0
Points
bigjimjohnstownes 08/17/08 - 05:31 pm
0
0
stupid is as stupid does--If

stupid is as stupid does--If you can't afford it, don't buy it!!! Then you won't be in the position to get scammed. Are you looking for a govn't bailout?

they call me pete
0
Points
they call me pete 08/17/08 - 05:32 pm
0
0
Cody--good point. The

Cody--good point. The reasoning is that a spouse cannot make a closing, may be overseas, may be attending the closing on the other end in another state...parents who's faculties are in decline. Legit reasons, but they can be maneuvered, as is obvious in this case. As having mentioned before, I had the displeasure of meeting this crew. Most of her clients were minorities and a great deal of them did not speak English. Her idea was to rent the homes of the people about to be foreclosed on to people with faulty credit. Then, she would try to get loans for the new renters, 99% of the time with 0 down. Sometimes the power of attorney, according to her, was needed for her to interpret. But she can't speak Spanish. It was such a complete scam.

augustalawyer
0
Points
augustalawyer 08/17/08 - 05:41 pm
0
0
The attorney, Sue Reimer,

The attorney, Sue Reimer, should be held liable for all of this as well. I hope people go after her as well.

they call me pete
0
Points
they call me pete 08/17/08 - 05:51 pm
0
0
Sue Reimer is claiming she

Sue Reimer is claiming she only rented space to her. BS. It was all a racket. They also need to look at Southern Mortgage, Wachovia and a few others for loaning out money on these homes. It's just not good solid business. It's on the fringe of legality before it even opens up for discovery. She is not licensed. That was what put me off. And I'm no genius. It's sad.

CAPSGAL
0
Points
CAPSGAL 08/17/08 - 05:53 pm
0
0
YES YES!!! Sue Reimer was a

YES YES!!! Sue Reimer was a party to all of this. I'm a Realtor and it was EASY to see through the scam. SDA contacted several of us to refer folks who were deliquent in their payments so that they (SDA and crew) could "save their credit". In all of their speeches and flyers it was stressed that Sue Reimer was the ONLY attorney that could handle this "difficult of a transaction." Ms. Reimer needs to be held accountable for her activity in this scam.

they call me pete
0
Points
they call me pete 08/17/08 - 05:59 pm
0
0
they call me pete
0
Points
they call me pete 08/17/08 - 06:00 pm
0
0
very true capsgal. Forgot

very true capsgal. Forgot about that. I bet I know you. Lol.

CAPSGAL
0
Points
CAPSGAL 08/17/08 - 06:24 pm
0
0
good possibility, pete been

good possibility, pete been in this for about 15 years

CAPSGAL
0
Points
CAPSGAL 08/17/08 - 07:18 pm
0
0
You w/broker or bank, Pete?

You w/broker or bank, Pete?

they call me pete
0
Points
they call me pete 08/17/08 - 07:28 pm
0
0
Done both caps.

Done both caps.

TakeAstand
13
Points
TakeAstand 08/17/08 - 07:38 pm
0
0
This person is a real

This person is a real [filtered word]!!! I hope she gets put under the jail along with all the others involved. But how do you trun over power of attorney to your home and not check on it for so long? People you have to take some sort of responsibilty for your own actions and stop trying to rely on others to fix your problems. Would you give someone access to your bank account to help fix your problems and then turn a blind eye for a few years never even checking on the status? I think not!! Lets see, you get yourself into mortgage problems, then turn responsibilty to get you out over to someone else and not think about it again, and then get taken advantage of, give power of attorney of your home to a stranger, not even make sure she is licensed and get to sue probably for a lot of money... hmmmm The cheap comes out expensive, you get what you pay for, you reap what you sow anymore I can think of. I am no real estate expert, but I wouldn't do what these pople did. People get themselves into financial difficulty then look for someone else to bail them out and close their eyes and cross their fingers becuase its easier than doing your homework and doing things the right way from the start!! Maybe next time they will listen to mom!!! lol

they call me pete
0
Points
they call me pete 08/17/08 - 07:51 pm
0
0
You would be shocked at the

You would be shocked at the people that come in for a mortgage loan take. It scares me sometimes. They can be told ANYTHING and they might believe it. If they have found a home they want, the paperwork is just a detail.

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