Hard money lending schemes creating fiscal chaos, devastating SLO County investors

March 13, 2008


A number of San Luis Obispo County investment firms have allegedly participated in schemes that may have already cost local investors more than $500 million, setting the stage for a colossal fiscal collapse unrivaled in this state’s history.

Utilizing a variety of hard money lending ploys and inappropriate management practices, the firms in question have created an environment that may shadow private finances in this county for decades, dozens of informed sources have told UncoveredSLO.com during the course of a two-month investigation.

“It’s like Enron for Paso Robles,” said David Farmer, an attorney with Farmer and Ready, a San Luis Obispo law corporation representing clients who believe they have been defrauded. “Those who claim this has to do with the downturn in the market need to take a cold shower.”

Professionals with intimate knowledge of details of the unfolding venture disaster said that hundreds of local investors who counted on these hard money lending institutions to manage and grow their savings will be lucky to recover pennies on the dollar.

One firm under particularly heavy fire from unhappy investors is Estate Financial of Paso Robles, whose president, Karen Guth, has declined comment on her alleged role in the unfolding disaster. Guth also owns Pasolivo, an olive oil producing company, with her son, Joshua Yaguda.

UncoveredSLO.com interviewed several dozen individual local investors, contractors, lawyers, law enforcement agencies, and lenders while researching this article. Some are directly involved in hard money lending; others have been watching the pending implosion from the sidelines.

Hard money lenders specialize in real estate-backed loans and short-term (bridge) loans. In these latter kinds of loans, funding is provided based on a collateralized real estate value. Higher interest rates can be charged because the loans often do not conform to ordinary bank standards.

Traditional credit guidelines that help shield banks and other lending institutions from high default rates don’t usually have a role in hard money lending. Loans are based on the value of the underlying asset rather then the borrowers credit rating. These kinds of loans originate with private investors, small groups of investors, and firms like Estate Financial that court individual investors.

A number of investors, lenders and builders contacted by UncoveredSLO.com have asked that their names not be used for a variety of personal reasons. One said he had yet to tell his wife that their entire investment was likely gone.

“Bob,” a North County barber for four decades, who thought he had retired two years ago, now faces a loss of most or all of the $450,000 he invested with Estate Financial.

“It looks now like I will be going back to work,” Bob said. “I get about $800 a month in Social Security. I built a home and sold it. I bought properties and sold them. I am 64. I have been under so much stress my blood pressure is through the roof. My plans for enjoying my retirement have gone to hell. I’ll have to cancel all my plans and go back to work. I will have to work till the day I die.”

A 62-year-old former telephone dispatch operator for GTE, “Pam” combines her Social Security and retirement package for about $1,700 monthly income. She bought a condominium in Santa Maria, sold it, and invested the proceeds with Guth at Estate Financial, thinking she had achieved financial well being.

“I am going back to work, cleaning houses,” she told UncoveredSLO.com. “I don’t know if I can clean houses until I’m 80 years old. I am very angry. We trusted her [Guth].”

To encourage investors, Guth distributed an Estate Financial brochure which claimed investors would receive trust deeds filed in the county, fire insurance policies, and title insurance.

Numerous investors told UncoveredSLO.com that their names were never placed on any deed of trust, and that they never received copies of fire or title insurance policies.

One local investor, “Mark,” discovered earlier this week that one of his investment properties had been sold in June, though he received no money.

“Estate Financial sold one of the condos for over $400,000 in June, Mark said. “They never told me. If they used the money for something else, that is not right. A couple of days ago, when I found out it sold, I asked for money. I was told I wouldn’t get it back and that Estate was researching what happened.”

Estate Financial is alleged by its investors and others to have co-mingled funds, paying from one investment to fund interest payments on another. Though similar in some aspects to a “Ponzi” scheme, Guth’s program often paid off many of the first trust deeds.

A few years ago, Shell Beach attorney and broker Kirby Gordon of Gordon Properties attended a meeting with Guth and his client, John Mielziner, to discuss the investment options available, and to learn how Guth managed those investments. According to Gordon, Mielziner, and dozens of investors, Guth claimed that funds were dispersed “progressively” (paid in steps as construction work is completed).

“We were told there was a draw system,” Gordon said. “They specifically told us that someone would inspect to make sure that the draw work was done – usually seven draws. That appears not to be the case.”

Many local properties have been fully funded, even though nothing has been built.

Ron Cooper, a developer for 25 years, went to Guth to help fund a project in San Dimas along with investments from his daughter, son and himself.

“She told me in writing we could start the work,” Cooper said. “She didn’t tell me she didn’t have the money. The money my family and I invested is gone. It’s ruined me. She knew she was out of money a year and a half ago. She was still taking investor money.”

Cooper received enough money to get the property’s entitlements, although no inspections of the properties were ever made.

“There was absolutely no oversight,” Cooper added. “Over the past 25 years, I have dealt with numerous banks and private lenders. I’ve never before had a lender approve a voucher and send a check without an independent inspection.”

Guth proceeded to foreclose on the property even though she failed to distribute the construction funds as promised. In response, Cooper filed three lawsuits against Estate Financial, Guth, and Yaguda.

“Phil” invested in a project on El Camino Real in Atascadero. In papers sent by mail for Phil to sign, the project was described as a 1,700 square-foot, four-bedroom, and three-bath house. When Estate Financial quit making interest payments in October 2007, Phil went to check on his investment.

“I measured the house at 1,100 square feet,” Phil said. “It only had three bedrooms and two baths. The loan-to-value is completely off.”

Another issue is Guth’s reported failure to disclose to some investors that she was a partner in numerous Estate Financial funded construction projects.

“We had no idea she was a partner in those projects,” Phil added. “No wonder she doesn’t foreclose on those properties.”

“Mike,” an investor into Estate Financial for $700,000 claims Guth told him his projects were completely funded and all they had to do was sell. Mike checked on the property. There was no house.

“All the money has been funded and all I have is a slab,” Mike said. “I will be shocked if I get anything back. She is not supposed to pay out money until the work is done. She won’t give us our money back.”

Most of the properties had no MAI or licensed appraisals preformed. Appraised value was determined by Estate Financial employees. “It’s like going to surgery to fix a broken bone without an X-ray,” said one local lender.

As a result of the alleged exaggerated appraisals and lack of oversight, many of the properties are “upside down”; even if finished, the properties are worth far less than is owed.

For example, one project, if completed, will sell for approximately $3 million. The title, however, shows 45 liens on the property that include unpaid taxes and penalties, deeds of trusts, and sub-contractor liens for flooring, electrical, landscaping, and appliances that add up to around $5 million. Add another $1.5 million to finish the property and the value is already off by 50 percent.

A group of eight investors attended a meeting with Guth to discuss issues last fall. “Guth told us if we sue we will only get 10 to 20 cents on the dollar,” Mike said. “Guth told us she is out of money; it was all paid back to us in interest.”

A few days ago, investors in the pool fund were informed that a limited liability corporation (LLC) had been started in their names. Guth is now requesting investors sign and return the documents. The agreement apparently would allow Guth to take out loans in investors’ names. Management fees would be determined by Guth, who would control distribution of the funds, according to numerous investors.

Though many investors would like to foreclose on some of the projects, they are unable to do so. Often, numerous people have invested in each project. Guth has refused to disclose to investors the names of other clients, who would need to agree on a course of action or go to court.

“Forget value, forget everything else, how do you get investors to agree?” wondered one local lender.

Attorney Farmer went to San Luis Obispo District Attorney Gerald Shea’s office searching for solutions.

“A possible remedy is for the District Attorney to start a civil suit with a receivership,” Farmer said. “Then investors could move forward with foreclosures. It is a serious problem and the public needs to demand that a public agency do something about it.”

Currently, the District Attorney’s office is directing concerned investors to contact the state departments of corporations and real estate.

“After it goes through Department of Corporations (DC) and the Department of Real Estate (DRE) we can look at taking other actions such as a receivership,” said Deputy District Attorney Steve VonDohlen. “I can understand the human fear factor. We ask that anyone who thinks they have been a victim of crime to report it. We are looking forward to getting the results from the state. Our office then will review for possible filing of criminal charges any cases that these investigating agencies submit to us after they have completed their investigation.”

Send on-line complaints to the DRE at http://www.dre.ca.gov/pdf_docs/forms/re519.pdf and to the DC at http://www.corp.ca.gov/about/pdf/doc29.pdf. Or call the DRE at 559-445-5009, option 3 or the DC at 866-275-2677.

Stay tuned to UncoveredSLO.com for more on this breaking story. Anyone with information on hard money lending issues in SLO County is asked to tip your editors at tips@uncoveredslo.com.

 Tags:, department of real estate, EFI, Estate Financial, fraud, Guth, hard money, lender, Paso Robles, yaguda

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By: Anonymous on 4/25/08 [Delete]

Yes, they were very busy when i went to check on my deeds i learned the county recorder clerk Julie Rodewald has officially denied all the public access to check the records citing security and privacy reasons. So I tried on line at home and the county web site will no longer allow anyone to access the information. Again citing personal privacy not wanting the upset investors to know where people live or what deeds have changed she is no longer allowing full public access. So something is really wrong here.

By: Anonymous on 4/21/08 [Delete]

Well now Karen and DOYA/EFI were very busy last week 4-17-08 dozens of filings were done on property. According to the County Recorder Julie many filings were done that day. There goes the money

By: Anonymous on 4/20/08 [Delete]

To me Investing is the same as gambling. You win some you lose a lot.

By: Anonymous on 4/20/08 [Delete]


Go to that website and see for yourself the lies and fraud that started all of this.

1. Interest stays constant . . . eliminating fluctuations due to changing economic conditions.

2. Principal value of investment does not vary.



Four bold lies.

What else do we need to know!

That's what my complaint to the Department of Corporations says. What does your's say?

By: Anonymous on 4/16/08 [Delete]

There will be a meeting of the investors on the Hinds Ave.project in Pismo Beach. Loan #518-05 on Monday April 21, 2008 at 12 noon at the Colony Inn Hall; 3600 El Camino Real, Atascadero. It is located next door to the Kennedy Nautilis Center. 805-466-4449. The purpose of the meeting is to hear about the different options available to the investors, to hear from the investors as to what they want to do, and to vote on these options. It is very important that all voting investors attend this meeting. Karen Guth, EFI President, Tony Wells a developer, Madeline Winn the junior lien holder, Wyndham Resorts, and two other interested developers will be there to tell us what they have to offer.

This meeting is definitely happening; if you want a voice in what happens to your investment on this project, then you should attend this meeting.You may e-mail me at

By: Anonymous on 4/14/08 [Delete]

Hi Joshua,

Did you or one of your friends write the below letter to Dave? It would make sense! That would sure mean you are in the scrambing mode!

Why would anyone make such a huge effort to try to flame Ron? Someone went way out of their way to do this. Think about it, WHY THE EFFORT? Use your brains, folks!

By: Anonymous on 4/10/08 [Delete]


DATE: Thursday April 17th


LOCATION: Atascadero

Colony Park Community Center

5599 Traffic Way

Traffic way exit off of 101 Whether going N or S

By: Anonymous on 4/10/08 [Delete]

You will never get back what you can't find.

By: Anonymous on 4/10/08 [Delete]

Just received info that a large number of transaction are being recorded between Karen Guth and her present/former husband in Washington, Charles Applebaum. Please advise if any info available. Dangerous.

By: Anonymous on 4/8/08 [Delete]

Ron Cooper says:

NEXT MEETING. Thursday, April 17th at 3 PM. Location to be determined in the next few days. Proposed agenda will be sent tomorrow.

NO MORE TALKING. Time to vote on how to move forward. We need 500 people, so please start telling everybody.

April 8th, 2008 at 9:34 PM

By: Anonymous on 4/7/08 [Delete]

Fund investors, please read this! Apparently no one has a list of investors so it's time we make one of our own! If you are new to this situation, Karen Guth has refused to give out the Fund investor list (as promised in her Circular) therefore not giving us a chance to regain control of our investments. I've arranged for an email account for you to write to. Please include your name, address, phone number, email account and any other information you would like to add. This is essential so you can be contacted. There's supposedly 1800 investors, so if anyone does have the list, spare me and let me know. Keep in mind, the phone book releases most the same info. Let's not waste anymore time! Send your info to effundinvestors@yahoo.com By sending your info you are not committing to any particular side or opinion. This list will also help individual deed holders in projects where Estate Financial has a majority control. Also, if you have given money to EF and you aren't sure if it's even invested in a deed or the Fund, please write.

Individual deed holders – I also recommend that someone step up to the plate for the larger first trust deeds and do this for their individual projects as well.

By: Anonymous on 4/7/08 [Delete]

Good News, if you go to The Central Coast Housing Bubble Alan Little, you can find direct information from those pursuing Legal Criminal Investigations on several of these scams. I spoke to one S/A from the DOJ they are indeed on the case. SLO Bear can you help get the information public

By: Anonymous on 4/7/08 [Delete]

Good News, if you go to The Central Coast Housing Bubble Alan Little, you can find direct information from those pursuing Legal Criminal Investigations on several of these scams. I spoke to one S/A from the DOJ they are indeed on the case.

By: Anonymous on 3/30/08 [Delete]

Former and present employees of EFI are sure to be questioned by authorities. Some were possibly dismissed for questioning Guth's tactics-not for cost saving as described by Guth. Darla Hansen and Laura Paulsen can provide answers.

By: Anonymous on 3/24/08 [Delete]

Folks, the money is gone. All of it is just plan gone. So you should look to COOKHAM HOLDINGS, LLC of Nevada and defunct Lawyer William Zech as well as R.W.H.P.,LLC of Florida

By: Anonymous on 3/23/08 [Delete]

To all – I am writing for the good of all. I, too, have money at EFI. I would like to compile a narrative of everyones stories concerning their investments with Estate Financial. Please write regardless of how big or small you feel your situation is and regardless if EFI has promised you they will resolve your issue soon (as they have so falsely promised me). This is strictly confidential. I feel time is of the essence here. I can help you get your complaints to the proper agencies. Your rapid response is essential here as events may be commencing next week which will significantly advance our cause – but ONLY, ONLY, if you write in!!! No I'm not a lawyer. I do realize some of you may have lawyers and feel you can't discuss your situation. That's fine, but whatever you can state, please do. This is essential to recovering as much of our investments as possible. My email address is fullyfunded93401@yahoo.com

Dewdog and Cooper: I really need to hear from you both Thanks!

By: Anonymous on 3/22/08 [Delete]

For those wishing to focus our attention in one place the other article and blog is at http://uncoveredslo.com/?id=78&showEntry=1.

And let's all not forget Dan and Karen. They have written some great stories and enabled many to perhaps recover their money before it is too late. I hope their efforts will not go unrewarded by the readers here. They are not making any money off this muckraking, let's help them help us by sending in some bucks.

By: Anonymous on 3/22/08 [Delete]



anyone else invested in this property. i'm missing the APN# and address.


By: Anonymous on 3/22/08 [Delete]


Lets not get to carried away with assumption of Karen Guth trying to flee with the 5 + M.If she wired the funds anywhere, its traceble and the FBI will get it back. If the Bank is in on it, the bank would be liable for much more than the loan. At this time, please don't think she would be so stupid. Lets assume, she is trying to make things work. Besides, remember!!! no false accusation here!! Just my humble opinion

By: Anonymous on 3/22/08 [Delete]




date posted:MARCH 18, 2008

By: Anonymous on 3/22/08 [Delete]

What is the other website? Can you please post the link? Thanks. And you are right, we should agree on one or the other. Which one?

By: Anonymous on 3/22/08 [Delete]

Folks are posting to both blog sites. Makes keeping up with things a pain.

If no disagrees how about placing new posts at the other site (under the latest article (Update) from Dan and Karen)?

A few folks are submitting their contact info, I suggest that is a good idea so we can all keep in touch.

My e is rikik77@gmail.com.

By: Anonymous on 3/22/08 [Delete]

Dewdog and all – What about this $5,866,100 loan from Heritage Oaks Bank? Are you saying that she is turning some (or all?) of her property into cash? If that truly is a personal loan, well then, she has a check for that amount in her pocket. Why? I'd like to hear your or anyone's thoughts about this. Sure sounds to me like she's trying to liquify as much as possible – perhaps to skip the country? This way, when her personal assets are seized, there won't be much left but slim pickings for us little guys. Thoughts please? Also, does anyone else have information about any other loans she has out?

By: Anonymous on 3/22/08 [Delete]

You can call John Childers

(805) 610-6331 to confirm.

Yes, we all are stressed out about the situation. The best way to solve it, is to work togather.

By: Anonymous on 3/22/08 [Delete]

One More: thanks for the reply.

i know we're all stressed about this, we just need accurate facts.

did John Childers tell you this or someone at EFC? it would be helpful to hear from J.C. thanks.

By: Anonymous on 3/22/08 [Delete]

I was told so. If it is not so, I was also misled. In that, case my apology

By: Anonymous on 3/22/08 [Delete]

ONE MORE: where did you get your facts that karen guth cancelled the thursday meeting? this site is supposed to be truthful.

By: Anonymous on 3/22/08 [Delete]

The meeting was cancelled by Karen Guth

By: Anonymous on 3/22/08 [Delete]

any info. on the LLC., that was just created by EF on B311-04?

By: Anonymous on 3/22/08 [Delete]

where is john/colleen childers? what happened at the thursday meeting with karen guth?

By: Anonymous on 3/21/08 [Delete]

Corli: There is a simple test to determine the truth about Estate Financial. Have them revel to the investors who is in what deal; names address and phone numbers. IF they are honest and have nothing to hide – this will be easy. Otherwise, as I expect, your loyalty will end up being misplaced. Simple enough!!!!!!

By: Anonymous on 3/21/08 [Delete]

We all agree that the economy has turned negative and it is the main problem for everyone concerned. However, there were many loans made with the full knowledge that the money was not there. EFI was hoping to have other homes sold by the time money was needed for consruction draws. At the same time, EFI charged fees and interest on money that was not set aside. That is clearly a FRAUD. Mistake can happen, but not at this level. Money was advenced to projects that EFI was involved with as a participating entity. EFI was eager to refinance for additional cost while they caused the delays in comleting many of the projects. Now it is their turn to sweat and they should. Ron Cooper's problem is not unique, it alsmost the norm. Many builders have not come forward with their plight yet, however it will be soon. EFI took money from investors deceived them loaned money to borrowers with the promise of having funds available to them when needed, but they were deceived too. That is a FRAUD also. EFI knew it had cashflow problems for some time while making new loans to book more fees and spread on the interest. It is a FRAUD not just greed. We all are greedy, but not fradulent. When the dust settles, there will be many more stories to suprise investors and borrowers. No, I don't beleive EFI will file for BC. It would open a can of worm much bigger than it is now. In addition, BC is filed in Federal Court and all the seperate entities would have to be disclosed. Any of them not disclosed, would constitute a federal crime and the FBI would be involved. With so many angry investors, borrowers destroyed, EFI would be a fool to file BC. ONly remedy is for everyone to cooperate and take a loss. Many investors received fat checks for years, now its time to face the new reality

By: Anonymous on 3/21/08 [Delete]

As a long time investor, I think the majority of us are not in agreement with the postings here. You can say that mistakes have been made at EFI, but making the leap to criminal accusations is absurd. This has turned into a witch hunt. These people have been delivering returns for many years. This is a horrid turn in the economy of this country, and you can try to pin the entire blame for the housing crash on EFI, but it's not the answer.

By: Anonymous on 3/21/08 [Delete]

EFI knowingly made false representation to their investors and borrowers . They knew the money was not there. EFI charged interest and fees on money that was not in the "segregated" account. Charged fees on loans that was never delivered. Failure was that home values stopped rising. Where did all that money disappeared to? Their own ventures that were overvalued and now in defaults. It is a FRAUD nothing less. They misrepresented the facts to their investors, contrary what they claimed in their litreture. The FEDS might get involvolved. Hope for a better solution than having the government take over the operation for everyones benefit. Many already taking a large haircut and many will have to suffer the same. The principals are clearly to blame, no sweet talk will get them out of this mess. Criminal charges?? It is likely. Good luck to all!!!

By: Anonymous on 3/20/08 [Delete]

I hope all readers are connecting with Ron, endless blabbing without positive action will yield nothing.

To those who criticize the victims, I disagree. Risky loans are one thing, fraud and incompetence are quite another. Most folks loaned their hard earned money based on the promise that these 'brokers' would handle the investments wisely according to acceptable professional standards. It seems this may not be the case.

So, throw rocks at the crooks, not the victims.

Anyone with pertinent info should e it to Ron so it can be collected in one spot. Or e it to me, riki77@gmail.com.

By: Anonymous on 3/20/08 [Delete]

Ms. Guth/Mr. Yaguda:

We trusted you when we invested with Estate Financial. Now, all we are asking for the name of all investors in the projects we are invested in. WHY WON'T YOU GIVE THEM TO US?????

By: Anonymous on 3/20/08 [Delete]

To our readers: Comments will disappear only when personal, unwarranted and unsubstantiated attacks are made on individuals. If I can't libel people, then neither can you… on this blog. Be real with your comments and then be as wild as you like.

By: Anonymous on 3/20/08 [Delete]

Ladies and Gentlemen you losses will be increasing soon, Karen and Al with EFI have been sued in San Luis Obispo, CA Superior Court Case # CV-070535 and Adam M Daner is involved trying to make monies off both ends. Karen and Al can't afford to even pay one of there lawyers so he is dropping out next week. The troubles will get worse by the day, i have been informed some of the cash invested has been turned into 1 oz Gold Coins to hide.

By: Anonymous on 3/20/08 [Delete]

Why are some of the blogs gone?

By: Anonymous on 3/19/08 [Delete]

Ladies and gentlemen. There's a storm brewing. We need to keep up with it and lead it to Estate's front door. I want to have a follow up meeting next week. We can probably expect three to four hundred people.

Who can help me arrange this – place, advertising, etc. please email me ron@cooperdevelopment.com or call (818) 225-1528 ASAP. Thanks

By: Anonymous on 3/19/08 [Delete]


who did you settle with?

By: Anonymous on 3/19/08 [Delete]

post new comments on March 18 RE: "estate financial investors fighting back"on uncoveredslo.com blog

By: Anonymous on 3/19/08 [Delete]

To Anonoymous and Cindy: For the record: Attorneys who fill out LLCs for clients are not usually part of an LLC other than as filer of the form. UncoveredSLO.com contacted attorney Rick Rodewald to inquire if he was in partnership with Karen Guth. He said he filed as her attorney and insisted he has absolutely no interest in her business.

By: Anonymous on 3/19/08 [Delete]

Hey, I just got notification of a interest payment of $192 for this month…not bad for an investment of $213, 000…maybe I can quit my job now and go back to being retired

By: Anonymous on 3/19/08 [Delete]

I'm in the Estate Financial Fund.

Please notify me of any upcoming meetings.

(805) 710-3945, jschacherer@hotmail.com

By: Anonymous on 3/19/08 [Delete]

Three Bells, LLC address just happens to be Rick Odewalds Law Office. Estate Financial,Inc. Happens to be owned by Rick Odelwald. He is said to be Guth's silent partner.

By: Anonymous on 3/18/08 [Delete]

corell: I respect your right to your opinion. But Karen and Josh are hiding many many things. Unless they come forth with the names of every investor and until they tell us where our money went (fully funded loans with no houses), there is no other conclusion we can draw but "FRAUD". Come to our next meeting and you will find out a lot about your investment that you don't know. Sounds like you have a good relationship with Karen and Josh – so how about getting us the names we are all asking for.

By: Anonymous on 3/18/08 [Delete]

I have been an investor with EFI for years. I have waited for the hysteria of these postings to subside, but as it hasn't, I have to remind people: this is happening all over the country. None of us is happy about it, but this is not fraud. Karen Guth and Joshua Yaguda have been involved in this community and have made money for this community for years. Maybe some mistakes have been made, but to call it fraud and to villainize these people is short sighted. They need to be given the chance to deal with this crisis like every other lending institution.

By: Anonymous on 3/18/08 [Delete]

Three Bells LLC, is comprised of Third Press Partners LLC (Karen Guth and Josh Yaguda) and Signature Homes LLC (Al Damyco)

By: Anonymous on 3/18/08 [Delete]

Three Bells LLC, Loan number B193-06, this was in the mortgage pool

By: Anonymous on 3/18/08 [Delete]

I'd love to hear from anyone with the following 1st TDs: 174-05; B519-05; B534-05; B193-06; B533-05; B502-05; B518-95; B237-04.

By: Anonymous on 3/18/08 [Delete]

24th Street Towne Homes, LLC, Hinds Avenue Partners, LLC, Three Bells, LLC,EFI Property Management, LLC, First Press, Second Press And Third Press, LLC,Buena Vista Place, LLC, Viana Devlopment, LLC, Doya Partners,LLC, Doya Partners II,LLC ,Estate Financial Mortgage Fund, LLC Are all owned by Karen Guth with the California Business Portal for the Secretary of State. Plus I am sure a lot more.

Your investments may be under any one of these.

By: Anonymous on 3/18/08 [Delete]

I would report this outfit to the SEC.

People have reported that they have received no proceeds even after the projects they invested in were sold. This means that Guth is defacto operating a real estate investment fund, which requires a license and exposes her to Federal SEC regulation and oversight.

By: Anonymous on 3/18/08 [Delete]

I would like to hear from investors in loans B176-05, B311-04, B356-05 and B626-04.

By: Anonymous on 3/18/08 [Delete]

That represents roughly 90 cents on the dollar ASSUMING the proceeds are actually paid to the investors and not fraudulently diverted to others.

By: Anonymous on 3/18/08 [Delete]

There is one house on Ranchita Cyn. that is in escrow, it's 77626 Ranchita Cyn. It appears to have 2 loans against it, one at $546k and one at $78k and was listed at $569k. The lending started with EF and then went to Mortgage Mgmt. Consultants, possibly an off spring of EF. This is a short sale.This house had previously been listed at $655k so you can see what has happened to the market and the investments.

By: Anonymous on 3/18/08 [Delete]

77000 Ranchita Cyn sold for $577,000. DataQuick shows NO association with EF.

By: Anonymous on 3/18/08 [Delete]


By: Anonymous on 3/18/08 [Delete]

EF has a home in escrow in the 77000 block of Ranchita Canyon in Monterey County.

Best to grab what you can.

By: Anonymous on 3/18/08 [Delete]

I did not attend the meeting yesterday although I do have a recommendation to some investors. Gain control of the properties that you have invested in. The more investors involved the more difficult this will be. It appears your only chance of any recovery of funds is whatever has been completed within your project and whatever the market value is today or in the future. Be sure to check a preliminary title report as there could be unpaid taxes and possibly some liens that will be attached to the property. Adding all of these negatives up may make the property worth nothing to you in todays market or there could be a little something left. Time is of the essence.

By: Anonymous on 3/17/08 [Delete]

Good first meeting today. Looking forward to follow-up meetings with more details. Does anybody have loan #B692-04. Let's talk.

By: Anonymous on 3/17/08 [Delete]



By: Anonymous on 3/17/08 [Delete]

The tribune is at fault too for lax reporting. I told the reporter some weeks ago I had info that contested her quotes from Karen Guth in that first article-she did not follow up on that.

I would be glad to share what I know of this industry with anyone who wants to deal effectively with this travesty. e me at riki77@gmail.com.

I missed the big meeting but there should be a follow up asap now that more people are in tune with all this. I would suggest other hard money brokers attend to share their business practices with all of us. Could be we need much more oversight and regulation of these people.

By: Anonymous on 3/17/08 [Delete]

I can't help find some profound sense of joy when I hear of a lawyer getting screwed…

Thanks for that at least!

By: Anonymous on 3/17/08 [Delete]

How about mail fraud. The Feds like to attack that one. And Estate has surely committed mail fraud.

By: Anonymous on 3/17/08 [Delete]

I'd strongly encourage investors to go directly to the U.S. Attorney in the district and demand that a wire-fraud investigation begin immediately. You will not get satisfaction in state court. You MAY get some revenge from the Feds.

By: Anonymous on 3/17/08 [Delete]

It amazed me to hear that some of these poor people stated that they were "accredited investors", when they clearly were not. Being an accredited investor is supposed to grant you access to more risky endeavors (such as investing in trust deeds), the thought being that you have enough assets to keep you solvent if one of the risky investments go bad. It's a bit disheartening to learn that "average" people (teachers? firefighters?) may have "fibbed" on their applications in order to get access to these "too good to be true" opportunities, when they clearly could not shoulder a possible loss. My sympathies go out to these people, but I can't help but wonder what was going through their minds when they stated (lied?) that they were an accredited investor, when they were clearly not able to take the risk. For future investors, remember: these rules are there for a reason…to protect *you*, not to unfairly keep you from the pot of gold that the "wealthy" have access to. – arroyogrande

By: Anonymous on 3/17/08 [Delete]

That was a great meeting to day and lets give Colleen a big hand for the great job she did..I'm looking for loan numbers B562-04 and B557-04, Borrowers is Doya Partners, LLC. add is 406 Montebello Oak Rd, Lot#10 and 409 Montebello Oak Dr #Lot 5…Please help me find the invester on them..805/610-6331 thanks

By: Anonymous on 3/17/08 [Delete]

SLOBear thanks for the apology. Dido from here. You are right though in your observations. This is similar to investing in the stock market and not knowing what you are doing. I did it-stupid me, I lost. But the difference was that I was stupid and not defrauded as appears this may be the case. I believe that EF was involved in some criminal activities and here is where the case lies. I would say the money is long gone and possibly a small percentage may be left in any equity that may be in the projects although with recovery costs and the declining market I would say it's all gone.

By: Anonymous on 3/17/08 [Delete]

Chuck,you are dead on.

I do apologize if I offended anyone with my comments as I have been running a blog dedicated to providing information about the fallacy of home prices and the role that fraud has played in this mess. If someone has stolen money from you, I hope they spend some time in prison.

People cannot be trusted with large sums of money without serious oversight. If given the opportunity, many people will just lie and steal – sad but true.

Hire the meanest lawyers you can find and pray the DA wants to pick up on this – that is your only recourse. I wish you the best, too bad the education was expensive.

By: Anonymous on 3/17/08 [Delete]

Investors in these local schemes have little grounds to say their situation is special because of fraud or deception by Estate Financial, et. al., since messes like this always involve deception and fraud. As the sub-prime disaster and other recent financial scandals have shown, there are fraudsters and suckers at every level of finance. Some supposedly smart money men have lost a lot too, and it's worth asking why.

The central feature of financial bubbles is self-delusion: the belief that there's no downside because prices keep going up. Most insidiously, even people who know there's a speculative bubble find it hard to resist, especially because there's probably an even bigger sucker to whom they can sell, and this is precisely how bubbles inflate.

Unsophisticated folks who've been lied to deserve a bit of sympathy, but they're still adults. These hard money investors are no different from property speculators and shouldn't be too surprised that they've been burned by their own greed. That this is all happening just a few years after a huge stock market bubble and the corporate accounting scandals is just mind blowing. (And folks who want to blame SLOBear here for giving them a cold slap may want to direct their anger elsewhere. I hope you get some money back, but you need to accept responsibility.)

By: Anonymous on 3/17/08 [Delete]

Who has info on Real Property Lenders? Anyone have anything good or bad to report?

By: Anonymous on 3/17/08 [Delete]

Stupid is as stupid does…

By: Anonymous on 3/17/08 [Delete]

If Ms. Guth is on the up and up you should all be provided with the following information. A decription of the property (APN) and project description where your money is going. A set of plans for the building. A cost breakdown (line item) of the costs provided by the borrower. A record of the disbursement of monies. The disbursement of monies should pretty much coincide with the estimates on the cost breakdown. There should also be an appraisal from an accredited appraiser.

More than likely on the cost breakdown you will see line items designated for paying for the loan during the course of construction with the intent that the project will sell quickly.

What you will more than likely find is that the project has been 100% funded for the land purchase and construction with additional funds implemented in the loan to pay for all fees etc. Consequently the project was actually funded in excess of 100% with no financial consequences to anyone but the investors and "the little guy" who worked on these projects and didn't get paid. Everyone is a victim except guess who.

Another aspect of this mess is the amount of money that was lent to individuals for several projects who had no money invested in the projects and who had no financial statements to warrant lending them millions of dollars when more than likely they would not qualify for ANY loan at a bank. Once again there is only one winner in this program also.

You all need to take action ASAP before all of the money disappears along with the culprit.

By: Anonymous on 3/17/08 [Delete]

You are all going to be my guest at San Luis Bay Inn

today. If you want, you can bring a sack lunch & drink. The weather should be nice today. see you there.

By: Anonymous on 3/16/08 [Delete]

How about if all construction funds were released on partially-built projects where GUTH WAS A PARTNER.

Would that be a sign of criminal activity?

Ya think?

But hey maybe we just need to leave her alone, let her do the right thing.

Ya think?

By: Anonymous on 3/16/08 [Delete]

Larry-If Ms. Guth said your money was going to be applied to a certain property your name has to be on the title, unless your money was in a "pool" account. If Ms. Guth identified a property were your money went as an individual and your name is not on the title that is definetly a "violation" of which many crimes can be associated with. It's even worse if it was identified as construction money and there is nothing there or if it is not completed and all of the money has been released.

By: Anonymous on 3/16/08 [Delete]

You can search the County Recorder database here:


A search for Estate Financial or Doya Partners reveals quite a bit of information.