Following Three Bells Winery money trail helps explain why DA, FBI are interested in Estate

April 3, 2008

By KAREN VELIE and DANIEL BLACKBURN

Angry investors wondering where their money went after funding Estate Financial of Paso Robles may be on the road to an eventual explanation.

Whether that translates into returns for those who have put money into Estate is yet to be learned. What is known is that millions of investor dollars have apparently been misappropriated, misspent, or misdirected, according to an investigation by UncoveredSLO.com.

Now, law enforcement investigators from the San Luis Obispo County District Attorney’s office and the FBI have finally entered the picture with a “preliminary inquiry” into a growing litany of fraud allegations leveled by an ever-widening group of individuals. Joint interviews with investors are being conducted by the two agencies, according to some who have shared information.

Deputy District Attorney Steve VonDohlen confirmed the interviews: “We are talking to some of the plaintiffs, and the FBI,” he said this week. “It’s a preliminary inquiry. We are mindful that some of these complainants are well over 65 years of age. There may, or may not be, criminal wrongdoing here.”

Criminal or not, many of the financial transactions of Estate Financial principals Karen Guth, her son, Joshua Yaguda, and others with access to the lending company’s money, are interesting if confusing. As a result, the money trail often becomes tangled. (Information for this article was gathered from court documents, interviews with investors and lenders alike, and a variety of informed sources. Guth declined comment when contacted by telephone Thursday.)

Trying to answer questions about how money moved once it was invested with Guth, UncoveredSLO.com focused on the funding and construction of Three Bells Winery in Paso Robles. The probe discovered critical inconsistencies in many documents; identical names buried within a potpourri of limited liability companies; and questionable use of Estate Financial funds intended for development of the Paso Robles winery.

In 2006, Estate Financial President Guth and her vice president, Yaguda, under the name Third Press Partners LLC, and Al D’Amico, as Signature Homes LLC, became financially equal partners in Three Bells LLC. An operating agreement between the three holds Guth and Yaguda responsible for day-to-day management and record keeping of the winery project.

Three Bells LLC borrowed $3,665,720 from Estate Financial to construct the winery. Of that total amount, Estate Financial doled out approximately $1.4 million for actual building and other facility construction.

D’Amico allegedly snagged more than $1.2 million for his own personal use. Guth filed bankruptcy, claiming $6,199,929 in liabilities on the project and noting her failure, as an owner of the winery, to stay current on her loan payments.

“The question is, how you can foreclose on a property for $6 million when the construction loan was for $3.7 million, and the actual construction cost was only $1.5 million?” wondered one involved party who asked to remain unnamed.

Three Bells LLC filed a lawsuit June 18, 2007, against its non-managing partner, Signature Homes LLC; D’Amico individually; and D’Amico’s Town and Country Landscaping LLC, alleging fraud, intentional misrepresentation, conversion, breach of fiduciary duty, and imposition of constructive trust. The latter allegation suggested that D’Amico used his position as construction manager to rent equipment, purchase sod, and hire supervisors for property other than the winery.

“Yes, I am involved in both sides of the lawsuit, not as myself, but as separate entities. It’s a legal thing,” D’Amico said, responding to UncoveredSLO.com’s questions about why he would sue himself for fraud. He then added, “The case has been dismissed by mutual parties.”

A subsequent check of county records, however, shows the lawsuit has not been dismissed, and a case management conference is scheduled May 7 in San Luis Obispo County Superior Court.

D’Amico and Guth continue to work together on other projects despite their mutual, intertwining litigation. On August 1, Guth signed over six deeds of trusts to D’Amico valued at approximately $77,000 each.

“That was reimbursement for money she (Guth) owed me for out of pocket expenses,” D’Amico said.

D’Amico contends the loan for the winery project was never properly funded.

“What happened to the money is the million-dollar question,” D’Amico said. “She (Guth) foreclosed on herself. She will own the property in a month or two and I will be out of the picture.”

Guth allegedly sent a letter to a number of investors placing the blame for the demise of the winery investment on D’Amico’s shoulders.

“I lent the money to Estate Financial and she is responsible to live up to her promises,” said one winery investor. “The money lost to D’Amico has nothing to do with me.”

Information obtained by UncoveredSLO.com suggests Guth knew her hard money lending business was in trouble back in 2004, long before the downturn in the market. Investors and contractors claim projects, funded from as early as 2002, have not been finished due to alleged mismanagement of funds.

Even so, Guth continued at the time, and to this day, to seek investors, primarily seniors, with the lure of high interest on property secured loans — without disclosing the company’s financial woes. On her Web site, Guth touts interest payments of 11 to 13 percent, though most investors claim they are no longer receiving any interest payments.

“If she is running a business and knows she is having financial problems, I think she would have to tell people,” said investor John Childers. “A person robs a grocery store, they go to jail that day. Guth robs millions from the elderly and nothing happens. She is continuing to get money from the elderly.”

Hard money loans are based on the value of the underlying asset rather than borrowers’ credit rating. It works if the lender finances no more than 60 to 70 percent of the project, secures licensed appraisals, and makes payments as the work progresses. Numerous investors claim Guth failed to follow through on these promises.

“If she had followed these rules, she would not be in trouble,” Childers said. “It’s a good business, but if people get greedy, it goes to hell. She made the loan to value, not an appraisal by a licensed appraiser.”

A San Diego investment firm in 2004 failed to disclose information regarding investments, and used new investment capital to pay off existing investors, which resulted in the U.S. Securities and Exchange Commission filing an emergency action to halt the ongoing fraud. Authorities froze finances and set up a receivership.

(Editor’s note: Contact information should be included in comments if individuals want to share information in more detail.)

Where else to look for help:

Call Rene Esquarel, California Department of Real Estate, 559-445-5009, touch “O” when recording comes on, and ask operator to connect you.

(See initial UncoveredSLO.com article on Estate Financial and its investors.)


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Stefan

By: Anonymous on 4/6/08

Okay, so far I haven't seen any posting of anyone claiming to have the complete list of investors in the Fund. If you know of anyone who does have that, even a partial list, contact me at fullyfunded93401@yahoo.com

By: Anonymous on 4/6/08

New people.

There apparently is a new meeting in the mix though no one seems to know what is actually developing in that regard. Here is another site with some interesting comments, http://www.topix.com/forum/city/san-luis-obispo-c


If you can stand it read up on this blog and you will find some contact info-and stay tuned. One bit of advice that seems to be consistent is get your papers in order, try to contact EF for info and send your feelings to the Dept of Real Estate-google DRE. E or call the Fresno office and complain.

I also advise you take a look at this online pdf from the DRE, http://www.dre.ca.gov/pdf_docs/re35.pdf. It outlines quite a bit of info about TD investing and what the broker is supposed to do for you (and maybe you will discover what didn't get done for you).

Keep monitoring this site for meeting info. And let others know about it so all can get informed. We should have strength in numbers.

By: Anonymous on 4/6/08

I'm new too and just heard about this site. I'm in the pool!!! I'm screwed and I know it. I'll take anything I can get back. I don't even know where to begin. I'll try writing to the sources that are recommended. I would have been so much better off with a trust deed.

By: Anonymous on 4/6/08

Did I miss anything yet? I'm looking for the meeting and can't find where it is? HELP.. I'm new here and I'll read again but please help the new investors. I didn't know about all of you.

Thanks in advance.

By: Anonymous on 4/6/08

Here is some contact info someone just posted on the Alan Little thread over at my blog – I think it may pertain to your situation as well:


Here is what you ALL need to do and God Save the Queen. Get all documents and contracts, statements, invoices etc… this includes your personal financial stuff as well. Need to he up front and honest remember it is a Federal Crime (Felony) under Title 18 U.S.C. section 1001 to lie to a Federal Investigator/Agent.


Send as a group if you wish all the information and complaint to:


US Department of The Treasury

IRS/Criminal Investigations Div.

2384 S. Professional Parkway

Santa Maria, CA 93455


US Department of Justice

CRD-Criminal Section-PHB

950 Pennsylvania, NW

Washington, DC 20530


US Treasury Department CID

SAC/ Debra D. King

PO Box 532151

Los Angeles, CA 90053


Stefan

By: Anonymous on 4/6/08

Insider,


You are on the right track. I hope on the next meeting plans can be formulated.

By: Anonymous on 4/6/08

WOW

So allthough a big challange if 51% of the fund participants could be gathered and convinced to eliminate EF as the controlling partner of the fund they could assign a new managing partner that could work with the other 1st trust deed investors and gain controll of all the properties. Even if EF had some real interest either as a owner of some of the fund or as an investor any opinion they had could be over ruled by the majority. Sounds like it would be in everyones interest to get a list of all investors in the fund and get them oganized for the benifit of all. The additional bennefit would be the knowledge of how much EF has personally invested which I bet is minimal if anything. I once again realize that its not only about the money but at the same time thier whole power trip is about the money. Its time to turn the tables.

By: Anonymous on 4/6/08

new karen guth beach house purchase with your investment money

38-7th street, cayucos,calif.

By: Anonymous on 4/6/08

Insider,


You are hitting the nail on the head. Most of the loans were partially funded as you say.

EF did charge fees on 100% of the agreed loan regardless of funds available to borrowers. Because of EF’s practice, money was not available to complete projects causing delays adding extra costs to borrowers. EF eagerly refinanced them at higher loan amounts collecting additional fees upfront and again failing to fund loans as agreed. EFI caused the mess to everyone. Builders were left out in the cold along with the investors. Now that the market evaporated, the value of those properties declined making those loans less collectible. Karen Guth’s comment about the market downturn and sub prime mortgage problem is way off reality. She caused everyone’s pain and hopefully she’ll reap the fruits of her action. Unfortunately, it still is very painful to all investors and borrowers. When all information is available, documents can be compared with the money trail tracked, Karen Guth will have a lot more explaining to do. Her son, Josh is in it 100% and his arrogant attitude will do him in even more.

By: Anonymous on 4/6/08

I already called the SEC and from what I recall, they looked her up and said she was listed as an Investment Advisor. I'm assuming they looked her up in their own data base. But they definitely told me to write in and complain. Also, someone else wrote below stating reasons you can write the SEC. If any of those circumstances pertain to you then I'd say write the SEC. I believe the Fund portion is what the SEC is interested in since EFI sell shares. You can call the SEC too. There number is 415-705-2500.

By: Anonymous on 4/6/08

wow

So if I here you right the new loans which may or may not have been refinanced were secured by a first trust deed with each trust deed investor having a percentage and with the "fund" which was the pooled investors haveing a 51% interest and therefore putting EF in a possition of control over all investors. Were all loans done this way? If this is true the next question is did they secure that possition at the time with a transfer of accual funds? I'll bet not. My experience was they were allways partially funded which meant the funds were rarely available for the contractor to pay his bills.


Stefan

By: Anonymous on 4/6/08

I don’t think so. According to report published in February, she has not even admitted that the fund have lost considerable value? So whatever she says it questionable anyway.

By: Anonymous on 4/6/08

Does anyone have an accurate figure on the total amount of funds (paid-in cash from investors) under management of Ms. Guth?


Also, does anyone know if she has registered these investments with SEC?

By: Anonymous on 4/6/08

Insider,


When all the information will come out, we can show a real intent to deceive that is criminal. Until we have more information, we can only speculate how the operation was set up. It will come sooner than you think. I am doing my part and will not rest until I get to the bottom of it.

By: Anonymous on 4/6/08

Insider,


Yes, that’s what I am talking about. However when those loans that were fractionized got refinanced with the fund being 51% investor on them. That is the problem. Karen knew exactly what she was doing.

By: Anonymous on 4/6/08

Anonymous

I assume you are talking about these pool investments. I was really talking more about the loans that are directly secured through the first trust deed. Even those will sometimes have the lender as part of the loan. The type where you actually have each investor assigned a percentage of the loan would be the easiest to take back. The pool investments are a new thing however if they listed themselves at 51% but did not acually invest 51% of their own money you might be able to gather enough investors to take it over. The first step would to be do a title search on a specific peace of property.

By: Anonymous on 4/6/08

Insider;


I concur with you. The problem is we don’t who is who and what money is invested in what project. The other main problem is that EF set up the fund and the fund has 51% control in most of the projects. Karen knew what she was doing when she set up these loans the way she did it. She is much smarter than most investors believe. Unfortunately, she used her knowledge in the wrong way.

By: Anonymous on 4/6/08

wow

I'm not suggesting anything. However if someone got paid off on a deal they new was upside down by thier own investigation and knew thier money was coming from a refinance there could be some level of moral concern. What I am saying is this is such a big deal it will take years to resolve and people in jail don't make quick payment. Vengeance is sweet but is doesn't pay the rent. The whole idea of these hard money loans is they are secured by a 1st. I just think while the wheels of justice are turning people in this situation should be getting together on a loan by loan basis and taking back thier property. Pronto!


Stefan

By: Anonymous on 4/6/08

Insider,


I think there is more than we know for now. We’ll get to the bottom of it anyway we can.

It will take more than just demands from us; it will take more than just civil legal action. It will take criminal investigation and it is happening as we speak.


By: Anonymous on 4/6/08

Insider,


I hope you don’t blame the ones who got their money with interest before this entire operation was exposed. They took their money because they were told that their investment will get 10 – 12% interest and can get it when the project or loan is paid off. They were also lucky not to reinvest or fall for Karen and Josh’s promise at the time. For whatever reason, they got out, it’s great for them. Unfortunately, the ones who got in at the end of the game having to shoulder losses. In my assumption (since I have no evidence now) Karen and Josh went into all those questionable joint ventures to create loans knowingly setting values high for fees and interest spread to themselves. That is a crime if they knew the properties were not worth close to what it was appraised at. .But again, Karen made the judgment of the value so we must question her future business judgment. Everyone, who asked to sign up with any of her new LLC proposal, should be ready to go down further.

By: Anonymous on 4/6/08

wow


It may be. However as each investor is paid off, a new loan is originated. At that time the new investors were probably informed of the purpose of the new loan was to pay off old loan and meet additional costs over runs of the project. I'm just playing devils advocate here. The whole thing is just wrong. If I had money tied up in this thing I would look at the quickest, cheapest and fastest way to secure my interest in the property and the best way to liquidate to return the most money I could. Each property will have a different solution depending on the current state of development.

By: Anonymous on 4/6/08

insider


if new investors money paid off old investors, that is called "PONZI" thats why it is a federal offense.

By: Anonymous on 4/6/08

As with all things the truth resides in the middle. Those who invested for years made money and probably got out while the getting was good. Those who invested in the last two years have all the reason in the world to question the whole thing. How could you take money from peoples retirement when you know the whole system was failing. Only to pay off your perfered investers?

By: Anonymous on 4/6/08

hot dog and others,

All this mess did not happen overnight and will not be undone overnight either.

If Karen Guth and Joshua Yaguda transferring any assist out of the fund, it will be undone. I don’t think they are that reckless although who knows? The FBI will not keep us updated what they are doing; it would be a violation of their own rules. I know how hard to be patient and you are not alone. I can’t even tell you to be patient because I am not either. I am angry of the situation like most other “losers”, but not without hope.

There will be a meeting soon with as more information coming forward.


Stefan

By: Anonymous on 4/6/08

Possible solution: My experience in correcting loans that have gone bad is that it's possible. In many cases what will eventually happen is that the individual investors with the help and expense of an attorney will file a majority action affidavit removing Estate Financial as the servicer and taking over the project themselves. You are then free to foreclose, complete construction and sell the finished project for whatever you can get for it.I have had to do this before. It is unpleasant, expensive and a lot of work but you do eventually get some of your money back. Attorneys fees for one project cost about $7,000 and that was probably ten years ago.

By: Anonymous on 4/6/08

The Employees? I guess they are cowards, thieves and liars. Just like so many of our esteemed political leaders.

Anyone heard from our glorious DA or fabulous FBI-or are they too busy chasing jay walkers? Crazy, I guess we are like a 3rd world country judging by how many things are run. It has been many months since a lot of this news has been out-I can't see how it should take more than a few days to sift through the records and interview Karen et all under threat of prosecution, and get some answers-pronto!

By: Anonymous on 4/5/08

Where are the employees? Step up and do the right thing…

By: Anonymous on 4/5/08

Hi,

I just found this place. My neighbor wrote down the site after listening to KVEC. I've been reading and am wondering if there is a meeting place set yet. Please post it more than once because there is a lot to read here and it could be missed. I feel much better now that I know where to find "other loosers" (I earned the right to say that, sort of like blacks calling each other the N word). Thank You for all the info I found here.

By: Anonymous on 4/5/08

By: Anonymous on 4/5/08

Has a date been set for an investor meeting of some kind? I have been working to get information (as provided by the offering) for more than 8 months. The email/letter exchange is interesting to say the least. I would like to pass any info to my clients.


Thanks

By: Anonymous on 4/5/08

Folks in the Fund, if you feel that EFI has in anyway failed to disclose or misrepresented to you information regarding the use of your funds or YOUR capital amount held with them write the SEC sanfrancisco@sec.gov Haven’t been able to get that information you need from them in it’s ENTIRETY, write the sec. sanfrancisco@sec.gov If you feel they have not been doing their job in preserving your capital, write the SEC. sanfrancisco@sec.gov Also, if they have made statements to you that weren’t true, write the SEC. If you have any information regarding how they may have misused the Fund’s money (this money should be strictly used only for FUND use – no other reasons) well then, write the SEC. sanfrancisco@sec.gov It’s also best you share this information with others. Karen Velie, sorry for not asking ahead of time, but please write her at velie@uncoveredslo.com with any information. Also, if you have information about who is doing the Fund’s books (I may be behind the curve on this) please forward that info, too. Are her books a strictly internal affair? Anyone having information as to whom Karen may have paid finders fees to, for signing up new investors please write velie@uncoveredslo.com (no these people are not in trouble, we just need their names). Now go help yourselves! Don’t waste more anytime, get busy writing!


Stefan

By: Anonymous on 4/5/08

True, there appears to be the need for a few to clean their rose colored glasses and take a good look at the facts. But I would concur that personal insults are of little help. I realize people need to vent.

Someone wanted thoughts or ideas about the "mortgage pool". I thought that was where the Guth/Yagudas dip and sun themselves after an exhaustive week of dodging investors. But seriously, what a fund share represents in the best case scenario is a fractionalized portion of a fractionalized portion of a trust deed. In other words, a properly recorded trust deed would have each individual and their respective portion of the total loan amount listed. The fund theoretically owns fractions of loans that are like any of the other individual fractional interests. Except that the fund is further divided by the interest of each fund investor (however many investors there are and their respective portion of the overall fund). Possibly designed to be this confusing? This is what we have if everything were on the up and up. Actually can and has worked if managed with the proper objectives in mind. A list of each project the fund is invested in and it's interest in each should not be a monumental task for a "minimally competent" outfit equipped with modern software. So you have to admit the silent treatment points toward the records being less than presentable. So unless meticulous records have been kept, it is possible that as fund investors, no real property is specifically attached to your shares. Considerably different scenario than was presented in order to get our money into the fund. This is but one opinion, but I think the only hope is to get the Securities and Exchange Commission or other agency to freeze assets and operations asap. The bad news is it won't be pretty. David Farmer summed it up best in the first article when he said

“Those who claim this has to do with the downturn in the market need to take a cold shower.”

By: Anonymous on 4/5/08

Hot dog,


Have some understanding on people who post here. This is not an entry for a literary competition. Everyone is hurt to some degree and venting. Would you rather him all of us parking at Karen office or at her ranch where emotion could be flying high? Common hot dog!!!!!!! As long as there is discussion people can express their feelings here, sooner or later we all cool off and get our heads together for a solution for the common good. This site likely saved some bigger problems for Karen, Josh and most of the victims. Remember, we are trying to find out what the hack is going on? Also, I believe, word is mightier than sword. So please everyone; write as you feel as long as no threats are made and no violence advocated. Just for fun, someone could take a donkey to EF’s office and have its rear toward the entry door without cleaning up natures work. LOL

By: Anonymous on 4/5/08

Corli,


Reading your comment makes me believe that you’re not in complete control of your faculties. There is a better word for that however I remain kind and civil to you on this site.

I don’t believe anyone is advocating violence against either Karen or Josh. That would be not only stupid, but counterproductive. Plus, how in the world the victims would have a chance to recover some of their losses. Again, I remind you and everyone that loosing money is not a crime. Stealing money is a crime. We don’t know the extent of Estate’s activities because they are hiding in their offices not returning calls, while still advocating new LLC to cure the problem with hefty fees to themselves. The Three Bell Winery is just one of many projects they siphoned funds off. Estate Financial was to be a lender of investor’s money, not a joint Venturer. EFI was the managing member of the Joint Venture, which allowed them to charge fees for the loan upfront and fees to run it. As you can decipher from the numbers, there was only mismanagement with an incredible incompetence and outright steeling of investor money. At this time we don’t know, but things will come to light when we get the BC filing documents. Believe me, it will be very revealing, possibly Bankruptcy fraud as well. You know, that is a Federal Crime not just a simple SEC violation with civil fines.

People lost money while Josh’s kids have all the goodies. Investor’s kid’s retiree’s borrowers all are out of luck. So tell all of us to have compassion on Josh and Karen. Not here Cori. Karen’s blame on D’Amico falls on deaf ears. He could not have taken the money unless Josh or Karen approved the expenditures and signed the checks regardless who it was made out to. You just don’t seem to get it. If you want to wait out the market, you might have to wait until the dollar is worth as much as the Mexican Paso or sum other worthless currency. In the meantime, will you please send some donations to the victims? You seem to have a dime to spare. Now, I stop writing, because I am just getting warmed up.


Stefan

By: Anonymous on 4/5/08

Hello!!!!!!!!! Are you people OK? What are these foolish posts? Mind what you are doing. Someone posts identical comments multiple times (under two different names); another posts to the wrong site. Jeez, come on. Take a little care here.

And folks might spend a minute checking their typing for some literacy, many posts are not very credible-some barely readable. Before you send your comment why not read it and see if you are proud of your message.

By: Anonymous on 4/5/08

CORLI?

who r u? Guths sister?> only an moran would defend a monster of this magnitude. u r a fool

By: Anonymous on 4/5/08

Ron Cooper suggestion is APRIL 14th for a meeting DATE..lets do it; perhaps we can find a spot at the new Atascadero Community building or similar. I am convinced that they got me to cash out my individual investments and put it all in THE FUND once things went bad and they refused to return my funds. i now realize why they did this and feel i have no way to even find where the money was placed other than in their pockets. i am 66.

does anyone have any thoughts on how much worse off i am not having any funds in the individual loans as i had originally? i am in the fund 100% because Karen met with me and said this was safer. joke. i want them to go to jail

By: Anonymous on 4/4/08

Still standing. Please fax me a copy of Karen's Guth's letter that you refer to. I would like to use it in my trail against Estate, Karen and Josh. (818) 225-1529


I will call expert witnesses who will testify that as of September 14 (and before) there were no "good opportunities" for loans such as Karen's. National homebuilders were well into walking away from large deposits on land purchase escrows, and had long ago ceased construction.


I suppose Karen will tell us she knew better than everybody else, and still knows better than everybody else.


I would appreciate your help.

By: Anonymous on 4/4/08

Let's see…Karen Guths Sept 14th letter states, "The number of borrowers with good projects continues to be quite large, and the opportunities for quality loans on such projects remain strong. Obviously, if funds from completed loans are transferred to withdrawing investors, they are not available to mazimize these new oportunities."


Hmm, how do you all feel about these remarks? Gee, lets see, houses are not complete and left to rot, many investors have been asking for their money back by this time, Karen HAS TO KNOW she's already in financial trouble (she can't even fulfill loan promises to her borrowers) and "SHE" implies that she wants to do even MORE loans???? Why, of course!!! More money for HER pocket in her fees! It appears she has no intention to fulfill the prior commitments she should be making. It seems to be all about how much money Karen can make for HERSELF, not about any preservation of capital or concern for her investors. What a ripoff!

By: Anonymous on 4/4/08

To Corli:

You're right about one thing. People should not spend their energy personally attacking Karen. What we need to focus on is getting what's left of our principle back. What I don't think you realize is that while you are waiting for the market to recover, your debt is growing. Did Karen tell you that she is still acruing her servicing fee? And that you will owe all the back property taxes? How about the fact that you will have to pay all the expired building permits? If the builder lets his insurance go, then you will need that too. You may even have to pay off some liens. The longer action isn't taken on each investment the more your debt will acrue. These bills will have to be paid when the project is eventually sold. If you get the majority of your principle back now, then at least you can invest it in something else(and I don't mean trust deeds), and have your money making some interest. Take the time to learn the facts about what is really happening to your investment!


Stefan

By: Anonymous on 4/4/08

Corlie. I think you are out of touch. I have not heard a peep out of the EF office, why is that? If they were honest, and minimally competent, they would call a meeting and keep all in the loop. They would be proactive and not let people wonder what is happening-that is the first evil in all this. The allegations in the three articles and comments from all these victims is pretty compelling-especially in the face of silence emanating from EF.

If you actually have some info that EF is honest, caring and competent why not reveal that on this blog?

Frankly, with the amounts of money involved and catastrophic consequences to the lenders it is a wonder there hasn't already been some 'direct action'. I would rather have a burglar steal my TV with a gun than lose my future to white collar criminals-the first one I could shoot if caught in the act.

Their silence (EF), rude to the max and a near admission of guilt, seems to be enough for many on this site to assess the situation. C'mon Karen, Josh, Corlie-if you know anything to offer-out with it.

Didn't the lenders with 21st Century wait? I hear Linda Kennedy ran off with $100,000,00. Waiting is for chumps, those who want justice will move on this as fast as they can.

By: Anonymous on 4/4/08

Corli, I'm not about to worry about Karen's son and her grand children. What about my children and grand children. They will have no inheritance while Karen and "hers" live high on hog from other peoples losses. The fact is that she wasn't honest. She was careless and she was greedy and sneaky. At least her son has an address and I couldn't care if they don't like everyone knowing it.

By: Anonymous on 4/4/08

Corli: why not attend our next meeting and tell us FACE TO FACE how we were not s c r e _ e d y Karen Guth and Josh Yaguda. Don't hide behind this blog.


P.S. I don't promote any violence or physical danger to them or Josh Yaguda's family.


I do promote truth and honesty.

By: Anonymous on 4/4/08

I have been devestated by this. Corli, how dare you come here and tell me how I shouldn't be angry. I was lied to. Karen didn't do any of the things she was supposed to do. Getting lied to and having my money pissed out the window wasn't part of the 12% interest that I agreed to. If I can take over my project I will. I doubt very much that there will be anything left when the market finally turns around. Just look at what the investigations have revealed to date. How dare you even try this one on with me.

By: Anonymous on 4/4/08

Corli-


Good luck with that strategy and let us know how it works out.


It is clear to me that most of the posters are currently in the anger stage of grief. It will likely be a couple of years before they reach acceptance – as all of their remaining money is eaten up by attorney's fees, transaction costs and property tax leins.


I think you all should hold your meeting in the parking lot of Pasolivo.

By: Anonymous on 4/4/08

Corlie: So we're all wrong and you're right! Cool!!!!!! But unalderated bull. We are retired and now have no money. Who can we thank for starvation ( one meal a day) – loss of our house – inability to visit our children and grandchildren – and the list goes on.


Are Karen and Joshua responsible for this – absolutely YES.


Thanks for caring about us. We'll take that to our gave.


Stefan

By: Anonymous on 4/4/08

I'm so disgusted with these exchanges. I feel sorry for the people who are truly confused and looking for answers about their projects. Have you read the postings of your cohorts? Who post the physical address of Karen Guth and her son? Who threaten to cut her tongue out? Are you kidding? Any credibility that you may have had, any chance of my attending any of your meetings is gone.

Someone asked: can anyone say anything nice about Karen or her son? You know why no one answered? Because the only people reading this blog are the 1% of EFI investors who don't get it. Who don't get that if Karen wanted to leave and steal all the money, she would have done so a long time ago. How dare you take 12% returns and now scoff at the risk? More importantly, look at these people's track record. And look at their presence in the community. Karen's son has kids here, has a family. One of you actually posted their address on this site and endangered their safety. You that are reading this, do you want to be party to that?

I cannot believe what venom and ignorance there is here.

You will continue to see the responses you want to see because you are the only ones reading this. The rest of us are waiting for the market to turn. We are not looking to place blame. We are taking responsibility for our investment and waiting it out.

By: Anonymous on 4/4/08

Smokey 67-68 says:

I just returned home after visually inspecting the location of my Loan B109-06, D A Fetyko, 198 San Luis street, Avila Beach, California 93424. At or around 196 San Luis Street, exists two three story 2.5 to 3.0 million dollar homes almost completed. They are in the photgraph for Avila Beach homes afiliated wi Estate Financial in the Telegram Tribune article dated: February 24, 2008. Well those homes are not the ones Fetyko tried to build. He built the three two story tan and bare metal buildings located at 209 San Luis Street, Avila Beach, Ca. which are accross the road and up the street a block and a half from the ones in the photograph. I believe that any one associated with this Loan Number B109-06 needs to get together to find out from Karen, Josh, Mel and DA Fetyko how our loan went up and accross the street from where the original location is stated on the loan documents. We also need to know who is going to finish it, and whom is going to pay for the completion. When if ever it will be completed.

By: Anonymous on 4/4/08

Read the Topix blog


http://www.topix.com/forum/city/san-luis-obispo-c

By: Anonymous on 4/4/08

Thanks Karen, Dan & Dave Congalton. The radio show was great. The investors that have been lost on the topix blog are on their way over here. I'm sure they'll be over joyed to find your site and learn about the next meetings.

By: Anonymous on 4/4/08

A big thanks to Karen Velie for talking on the radio today! How informative!!! What great investigative reporting! Applauds to her! Go get 'em girl!

By: Anonymous on 4/4/08

WOW

I think that the loans had to be addresses to each individual lot and not the project. I've only checked a few but the ones that I did check were all very similar and there was no great desparity in the loan amounts. The only difference may have come from the sq. footage of the different projects. The injustice here is that the investors were not made aware of the deed restrictions on the particular lots or APN's were their money went. Obviously the investor should not be lending $350k on a project that can only return $265k. Now the developer may have taken the "extra" funds and used them somewhere else which is against the law. The bottom line is that the investor got duped for around $100k that is gone and there is no way to get that with the deed restriction in place. Unfortunately these affordable/work force housing programs sound good, I've always referref to them as a photo op for the politicians, but as you can see they are actually not good for anyone including the investor, developer and even the buyer. There is little to no room for the buyer to ever recover any appreciation. I think if you check most of these homes have never been sold, started or in this case completed. They are a financial failure.