Case: Parker, et al. v. MAC Industries, Inc., Michael Allen Cox, Nancy Ann Guerra, and Christopher Gene Guerra (Case No. 37-2008-00103306-CU-OR-SC) [real estate fraud]
Court: Superior Court of San Diego County, Hall of Justice
Judge(s): William S. Cannon; Keith Medel; Timothy B. Talyor
Date: March 22, 2013
Result: Total Judgment = $1,009,969.48 ($617,679.48 against Michael Cox and MAC Industries, Inc. and $392,290.00 against Nancy Anne Guerra and Christopher Gene Guerra).
Facts & Allegations:
Defendant Michael Cox owned a real estate brokerage called MAC Industries. MAC Industries was a California corporation conducting business all over California, and also in Washington, and Nevada. Nancy Ann Guerra and Christopher Gene Guerra were co-conspirators who aided Cox in his fraudulent real estate scheme. Cox, MAC, Nancy Ann Guerra, and Christopher Gene Guerra will sometimes be referred to as the “Defendants.”
More specifically, Cox would create so-called “investor groups.” Then, Cox would direct these “investor” groups to purchase, sell, and then repurchase and resell properties from each “investor group” for higher and higher prices in order to earn commissions and other fees from each purchase and sale transaction.
The Guerras were complicit in this real estate ponzi scheme and would arrange the financing for Cox’s “investors,” and fraudulently qualify them for loans they were not qualified to obtain. As a result, the Guerras earned additional compensation for brokering the loans the “investor” would obtain in order to acquire the subject property.
Plaintiffs were among these “investors.” Cox and MAC created a straw-man purchaser to prevent a non-MAC “investor” from purchasing the property. Defendant MAC wished to prevent all buyers, except for MAC “investor” buyers, so that defendant MAC could represent both the buyer and the seller of the property, and assure themselves twice the normal commission from the real estate purchase and sale transaction. Plaintiffs ended up selling their home.
Then, Cox and MAC convinced Plaintiffs to have Plaintiffs use the proceeds of the sale of their home to invest in additional real property chosen by MAC and Cox and obtaining loans involving the Guerras who worked for Cox. MAC and MAC and Cox received commissions on each of these purchase and loan transactions as well.
Additionally, the Defendants also convinced the Plaintiffs to refinance an existing home that they owned so that they could pull cash out and use it to purchase additional investment properties that Cox would choose.
Cox arranged for Plaintiff’s money to be tied up in a 1031 exchange and executed purchases of three properties for Plaintiffs. Cox and MAC made material representations about each of the three purchases, that caused Plaintiff’s out of pocket losses, a foreclosure on one of the properties, and short sales of the other two properties. The Plaintiffs were over 60 years old and lost their life savings due to the above-described real estate ponzi scheme.