Quiescent county Web site stirring suspicions

April 4, 2008

By KAREN VELIE and DANIEL BLACKBURN

A Web site maintained by San Luis Obispo County’s Clerk-Recorder’s office – which provides property deed transaction data and other public information and is routinely updated weekly — has been dormant for 36 days.

The site’s lack of relevance quickly became a cause of concern for some investors who have placed funds with a troubled Paso Robles hard money lender, Estate Financial.

Clerk-Recorder Julie Rodewald attributed the site’s inactivity to a missing technician and promised a quick fix. But the site had not yet restored to a current status by midday Thursday.

The Web site contains general information on the Clerk-Recorder’s office as well as a searchable database to allow public access to official county records.

The situation raises a question of conflict of interest, according to several investors who talked to a reporter. Roderick Rodewald, the clerk-recorder’s husband, is a San Luis Obispo attorney whose clients include Estate Financial and its president, Karen Guth.

UncoveredSLO.com posted an article March 14 reporting the apparent unraveling of Estate Financial and actions and practices of its two top officers, Guth and her son, Joshua Yaguda . That article detailed the alleged loss of millions of dollars by a large number of investors, many of whom said they had been hindered in their efforts to contact others with funds in Guth’s hands.

Three days after that article appeared, several hundred EF investors expressing deep concern and growing anger met at San Luis Bay Inn to exchange stories, loan data, phone numbers and action plans.

“At a time when Estate Financial is not forthcoming with investor data, the Clerk-Recorder’s office is one of the few options investors have,” said one person who has been regularly monitoring the Web site’s lack of progress, wrote in an e-mail to UncoveredSLO.com.

Numerous individuals allege that Estate Financial has sold properties and failed to repay investors. Consequently, many investors rely on the Clerk-Recorder’s Web site to follow activity or changes involving their properties. The site provides information showing if any reconveyance (loan repayments) have occurred; or if Estate Financial is foreclosing on specific properties.

Investors might be unaware that the site has been outdated during the month-plus dormancy, and as a result may be relying on stagnant information during a period when numerous Estate Financial transactions might be occurring.

Julie Rodewald said she has been out of the office on personal matters and has not been able to facilitate updates.

“Our system is not a county standard system,” she told UncoveredSLO.com, “and our IT guy is out. The (county’s Information Technology Department) doesn’t manage our AS400 (computer program). That we are trying to deny access to documents because of Estate Financial is absolutely not true.”

A source in Information Technology said any one of more than two dozen county technicians could have easily and quickly handled the usual updating. Other computer experts contacted by UncoveredSLO.com said keeping the county Clerk-Recorder’s site current is not a complex undertaking, suggesting the site’s update is virtually a push-button exercise.

Julie Rodewald said this week she would have nothing to gain from trying to affect the Web site’s current status.

“This begs the question, can he or I do anything?” Julie Rodewald said when asked if her husband’s work for Estate Financial has created at least the impression of a conflict of interest. “Our personal lives are separate from our professional lives. All recordings are public record.”

Roderick Rodewald, too, scoffed at the suggestion of a conflict.

“How in the world could I assist Karen Guth through my wife’s office?” he wondered recently. He also noted that he and his wife have “heard the allegations” but insisted no conflict exists. He disavowed any involvement with Estate Financial other than providing legal counsel.

One of Roderick Rodewald’s counsel chores was to chastise Myron “Mike” Knecht, who placed an advertisement in local periodicals seeking to locate and organize other EF investors. The lawyer wrote in a Sept. 2007 letter and e-mail to Knecht that his ads were having “an adverse affect on our clients’ business.”

Roderick Rodewald added, “Your advertisements have a chilling effect on both further investments in the mortgage fund and on the fractional loan investments, with corresponding harm to your fellow investors and my clients’ business. I would urge you to discuss this with your attorney… as such statements could expose you to significant legal liability.”

Knecht said he checked with his own attorney.

“By Karen Guth’s own admission, ‘investment capital will not be returned at any time in the foreseeable future,’ (so) my statement was not actionable. Something about the truth being a defense,” Knecht wrote in a reply to EF’s lawyer.

Some EF investors have also questioned an apparent new practice at the Clerk-Recorder’s requiring names and addresses of people seeking deed information.

“Sometimes we may ask for a person to sign, sometimes not,” said Julie Rodewald. “There’s a form to fill out. You don’t have to sign it. We are not keeping tabs on people who come into the office. Every little thing becomes a conspiracy.”

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Stefan

By: Anonymous on 4/23/08

What is happening with Vanguard Lending? How have they avoided this mess?

By: Anonymous on 4/23/08

Paso lenders – including Estate Financial – get more scrutiny from state and DA

DA’s Office receives an update from several state agencies on investigations, but details are private

By Melanie Cleveland

Local prosecutors and state regulators met in San Luis Obispo on Tuesday to discuss investigations into troubled Paso Robles real estate lenders whose investors may have lost money, the county District Attorney’s Office confirmed.


The firms under scrutiny include Estate Financial Inc. and Real Property Lenders. The companies pooled investors’ money to fund high-interest loans to real estate developers.


Estate Financial has become the target of sometimes harsh public complaints since the company disclosed in the fall that its real estate portfolio was in serious financial difficulty.


The firm’s leaders have blamed the real estate market downturn for its problems.


Tuesday’s closed-door meeting included representatives from the state Department of Corporations, as well as other unspecified state agencies, according to Deputy District Attorney Steve von Dohlen.


He said that at least three representatives from the District Attorney’s Office attended, including Assistant District Attorney Dan Hilford; John Tooley, an investigator working for the District Attorney’s Office and von Dohlen, who specializes in consumer protection.


Von Dohlen did not disclose specifics or the status of the investigation, except to say the agencies were continuing to respond to complaints about the companies.


“We got an update from the various agencies to find out where they are,” von Dohlen said. “Other than that, I’m not at liberty to discuss details.”


Karen Guth, president of Estate Financial, said Tuesday that she had met last week with state regulators.


“It went like a routine audit, and we’re cooperating with them,” she said. “I assume this is something that will take awhile.”


Real Property Lenders owner Rod Jarmin could not be reached for comment.


Von Dohlen said the District Attorney’s Of fice encourages investors with concerns about the companies to file complaints with the state’s Department of Corporations or Department of Real Estate if they haven’t already done so.


Those two agencies regulate investing and lending practices in California.


Von Dohlen confirmed a month ago that his office had been in touch with both state agencies over investor complaints about Estate Financial’s management of its real estate loans.


Von Dohlen said then that the state agencies could take a range of actions against such companies, including probation, suspension or revocation of its license to do business, assessment of fines or referral of the case to prosecutors.


Stefan

By: Anonymous on 4/22/08

On 4/19, Insider came up with a plan which makes the most sense (a board of directors made of large investors plus Karen and Josh, and an accountant to go through the numbers).


For the people who feel that a receiver will eat up too much money and not be familiar with operating this type of business, Insider's solution will bring transparency and checks and balances to the day-to-day operations of EF.


A board of directors, made up of large investors, would work with Karen and Josh, to go over each project and agree on a consensus basis — so there is no bias for finishing projects, especially when some of those projects involve Karen and Josh as investors. (Are those projects being funded when other projects have no money?)


We were not able to attend the meeting. Who is due to receive the list of investors?


Insider, are you willing to put together a board of directors to approach Karen and Josh? It would seem that this solution would be preferable to Karen and Josh (versus having a receiver come in, where they would be out altogether).

By: Anonymous on 4/22/08

To Don,


Investors should really check it out for themselves. So far, Phoenix has been extremely helpful to me even though I was at first sceptical. It can't hurt to at least talk to them.

By: Anonymous on 4/22/08

PHOENIX W 65 LLC? How do we know this isn't one of Karen's numerous LLC. Please don't be fooled.

By: Anonymous on 4/22/08

Right on both yancygirl and Let's get it together. We must stop the bickering and start acting because precious time is being wasted! Someone-I wish I could but I now live out of state-should hold another meeting and start making a list of names for each investment as well as the Mort. Fund. I do have an investor list for the Wolfhouse Inn project if there is anyone out there who is also an investor. Additionally, there is a company that is currently helping investors from other hard money situations like EF. It's called Phoenix Recovery Group with Peter Josserand as the principle-Attorney. I've spoken with all of the fellows at Phoenix and feel very comfortable that they might be capable of helping in some of these bad deals. And,I have some friends who are currently using their service for approx. 10 failed investments. I found out that Phoenix is assisting over 300 people/investors (16 projects) in similarly failing circumstances. Having a meeting with these guys could be a good place to start.


Stefan

By: Anonymous on 4/22/08

If any of you DOT holders want to get together on specific projects to take them over and salvage the equity, please contact me at k2bornot2b@aol.com with your contact information and loan number.


By: Anonymous on 4/22/08

Spring Cleaning?? — Caught in the act — Josh was observed removing file boxes from the back door of EFI offices last evening and loading them into his truck. It looks as though the office is being vacated as quickly as possible.


It is entirely possible that records will soon not be available.


Has anyone received the long-awaited investor list?

By: Anonymous on 4/21/08

Wondering:

Attorneys act as agents for their clients. Rick Rodewald is the agent for Republic Properties according to the Secretary of State's site. The street address of the corporation is Estate Financial's address not Rick Rodewald's. Double check your facts before slamming others.

By: Anonymous on 4/21/08

If you do not trust EFI than you need to replace them with a receiver that will manage the operation. You will than have access to all the information you

are seeking and the underlying assets. Until then, we don't know what is going on. If half the comments on this site are true, than the investors have lost millions (perhaps tens of millions). Bringing in a receiver who will open up the books and tell the investors where they stand is currently the only answer.

By: Anonymous on 4/21/08

IS GUTH ESTATE IN FINANCIAL TROUBLE? You bet!!!!!!!

"Since last February 1, 2006, Estate Financial was a borrower from Heritage Oaks Bank on an unsecured line of credit in the amount of $5,000,000. Guth was a guarantor on the line of credit. About 11/15/07 EFI entered into a "CHANGE IN TERMS AGREEMENT" with Heritage Oaks Bank. "The third paragraph on the first page of the agreement describes the change in terms including an extension of the maturity to 11/15/08, that the loan is no longer a revolving line of credit and that collateral for the loan has been added which includes a deed of trust on each of the two gas station properties owned by Templeton Products, Inc.

Can Heritage Oaks Bank sustain a $5,000,000 loss?


LYING: Guth/Estate have no lawsuits against them. Here's two for you to look up – 6/22/07 Case CV070549 and 1/10/07 CV071107. The latter includes a cause of action asking the court to issue a permanent injunction prohibiting Guth and Yaguda from continuing to engage in unfair, deceptive and/or fraudulent business practices.


Investors – you are LAST IN LINE as Guth/Yaguda have mortgage away EVERYTHING.


Stefan

By: Anonymous on 4/21/08

to: Let's get it together


I think the first step is: for everyone to get a PROPERTY PROFILE from a title company (I understand that this report is either free or nominal) this will let them know all of the investors on the account then if there is more than 50% investors (and hopefully it's not one of the many corporations of EFS), contact each person and if agreed than we can take over as the "folks in charge" of each loan—


As I understand it, our only option is NOT receivorship- we can take control of our own stuff.


Second: if at all possible we should get from EFS a disbursment registry on each loan— and a list of investors–


I think if everyone takes control a pro-active stance in this and works hard on their own loans we can start to have some of the power back!


Hopefully, some folks are already doing this and we will be hearing from each other soon–


You MUST take action on your behalf, don't wait for someone else to do it- it will not get done!


If a meeting is called again, and we shouldn't wait for Ron Cooper to do it— if we have to, we can meet at a park– (we could meet at EF office :-) anyway, I'm sure there are a few people (I would help) that can set up tables and do exactly what the atty. at the last meeting did- gather information— I know her name was Karen (don't know last name) maybe she will have a fair amount of info. and we can work with her.


I would think there's an atty. out there that would work on this case, without upfront money and take it at the end— surely that has to be cheaper in the long run than to leave it in the hands of EFS.

By: Anonymous on 4/21/08

When are we going to stop bloging and do something? Everyday assets

could be re-characterized are even lost and there is no organized plan to stop or oversee this company. I suggest everyone report there information to the DOC, DRE, DA etc. We need a plan!

By: Anonymous on 4/21/08

First Press Partner is only but one of many, many companies that Karen Guth is involved with.

By: Anonymous on 4/21/08

Check out the San Luis County clerk-recorder's office search form


http://services.sloclerkrecorder.org/officials/se


Search 'Republic Properties' in the top box and press 'GO.' Look at all that fun activity going on with Rick Rodewald's company! Here's just one of the many fun names – First Press Partners – sound familiar? For those of you not in the 'know' that's Karen and Joshua's company.


Do these people not know almost everyone at home has a computer now days?


Stefan

By: Anonymous on 4/21/08

to: Let's get it together


I think the first step is: for everyone to get a PROPERTY PROFILE from a title company (I understand that this report is either free or nominal) this will let them know all of the investors on the account then if there is more than 50% investors (and hopefully it's not one of the many corporations of EFS), contact each person and if agreed than we can take over as the "folks in charge" of each loan—


As I understand it, our only option is NOT receivorship- we can take control of our own stuff.


Second: if at all possible we should get from EFS a disbursment registry on each loan— and a list of investors–


I think if everyone takes control a pro-active stance in this and works hard on their own loans we can start to have some of the power back!


Hopefully, some folks are already doing this and we will be hearing from each other soon–


You MUST take action on your behalf, don't wait for someone else to do it- it will not get done!


If a meeting is called again, and we shouldn't wait for Ron Cooper to do it— if we have to, we can meet at a park– (we could meet at EF office :-) anyway, I'm sure there are a few people (I would help) that can set up tables and do exactly what the atty. at the last meeting did- gather information— I know her name was Karen (don't know last name) maybe she will have a fair amount of info. and we can work with her.


I would think there's an atty. out there that would work on this case, without upfront money and take it at the end— surely that has to be cheaper in the long run than to leave it in the hands of EFS.

By: Anonymous on 4/21/08

When are we going to stop bloging and do something? Everyday assets

could be re-characterized are even lost and there is no organized plan to stop or oversee this company. I suggest everyone report there information to the DOC, DRE, DA etc. We need a plan!

By: Anonymous on 4/21/08

First Press Partner is only but one of many, many companies that Karen Guth is involved with.

By: Anonymous on 4/21/08

Check out the San Luis County clerk-recorder's office search form


http://services.sloclerkrecorder.org/officials/se


Search 'Republic Properties' in the top box and press 'GO.' Look at all that fun activity going on with Rick Rodewald's company! Here's just one of the many fun names – First Press Partners – sound familiar? For those of you not in the 'know' that's Karen and Joshua's company.


Do these people not know almost everyone at home has a computer now days?


Stefan

By: Anonymous on 4/21/08

to: Let's get it together


I think the first step is: for everyone to get a PROPERTY PROFILE from a title company (I understand that this report is either free or nominal) this will let them know all of the investors on the account then if there is more than 50% investors (and hopefully it's not one of the many corporations of EFS), contact each person and if agreed than we can take over as the "folks in charge" of each loan—


As I understand it, our only option is NOT receivorship- we can take control of our own stuff.


Second: if at all possible we should get from EFS a disbursment registry on each loan— and a list of investors–


I think if everyone takes control a pro-active stance in this and works hard on their own loans we can start to have some of the power back!


Hopefully, some folks are already doing this and we will be hearing from each other soon–


You MUST take action on your behalf, don't wait for someone else to do it- it will not get done!


If a meeting is called again, and we shouldn't wait for Ron Cooper to do it— if we have to, we can meet at a park– (we could meet at EF office :-) anyway, I'm sure there are a few people (I would help) that can set up tables and do exactly what the atty. at the last meeting did- gather information— I know her name was Karen (don't know last name) maybe she will have a fair amount of info. and we can work with her.


I would think there's an atty. out there that would work on this case, without upfront money and take it at the end— surely that has to be cheaper in the long run than to leave it in the hands of EFS.

By: Anonymous on 4/21/08

When are we going to stop bloging and do something? Everyday assets

could be re-characterized are even lost and there is no organized plan to stop or oversee this company. I suggest everyone report there information to the DOC, DRE, DA etc. We need a plan!

By: Anonymous on 4/21/08

First Press Partner is only but one of many, many companies that Karen Guth is involved with.

By: Anonymous on 4/21/08

Check out the San Luis County clerk-recorder's office search form


http://services.sloclerkrecorder.org/officials/se


Search 'Republic Properties' in the top box and press 'GO.' Look at all that fun activity going on with Rick Rodewald's company! Here's just one of the many fun names – First Press Partners – sound familiar? For those of you not in the 'know' that's Karen and Joshua's company.


Do these people not know almost everyone at home has a computer now days?


Stefan

By: Anonymous on 4/20/08

Nope! Republic Properties is, in fact, owned by RICK RODEWALD according to the Secretary of States records as of tonight at 10:30. It'll be interesting to see how fast it may go out of business though!

By: Anonymous on 4/20/08

Wondering


I beleive First republic was owned by Karen's x-husband, I couldbe wrong

By: Anonymous on 4/20/08

Truman,


Property Tax first, First TD Second. Second TD or Line of credit gets wiped out also

By: Anonymous on 4/20/08

To – Heres how its done


The below posting from 'Heres how its done' is just in gross theory and exemplifies a potential situation that could occur. How it's really done, well, Karen Guth and Rick Rodewald (Republic Properties Inc owner) – you know the lawyer that is married to Julie Rodewald – the lawyer that doesn't mix his legal relationship with Karen's business. Mike Knecht, you know the guy I'm talking about, right? The lawyer that sent you the letter! And don't forget Julie claims to have no involvement in the above article. Her credibility is now vanishing into thin air! Poof, gone!

By: Anonymous on 4/20/08

Truman,


Perfected mechanics liens become a junior lien. It will get behind First TD Second and all of that is behind property taxes. If a perfected mech.. liens pays off the First TD Second or anything ahead of it than they get theprop. It is unlikely unless the math makes sense.

By: Anonymous on 4/20/08

Wow: Mechanics liens, if filed properly do not get wiped out in a foreclosure. Just most attorneys don't know that. But thy do have to be filed properly and perfected.

By: Anonymous on 4/20/08

To the best of my knowledge, all liens gets wiped out by a foreclosure. Makes no difference if any actual cash changed hands. Other thanproperty taxes, nothing else needs to bepayed. I am not certain how the insurance co. comes in the picture for the actual construction. A bond is normally required for site improvements only. In Estates case, they've issued LC (Letter of Credit) to the city instead of an actual bond. Thats why another cityis suing Estate Financial for performance.

According to Karen Guth, EFI had no lawsuits pending against it as of two weeks ago. Interetingly, on Thursday night shestarted her introduction of a borrower who was present and had action pending against EFI. She can lie without blinking an eye. Many sheeps still beleivedher


Stefan

By: Anonymous on 4/20/08

Karen has a foreclosure company (don't know the name).

Karen's other foreclosure company gets the extra interest and late fees –

sort of. I learned the loan foreclosure amount is 21,000,000 but the loan was only 11 million.

Soon that figure will be up to 22 million due to late fees, accrued interest, etc., so I want to run the math by you. This is why

we will be lucky to see 30 cents on the dollar. If the investors had 11 million invested in

Ron's name (supposedly a segregated account) and Karen only gave him 3.5 million (admitting to

running out of money), then there is 7.5 million that's unaccounted for. Besides this, it doesn't even sound legal that Karen can foreclose on Ron. If the

project short sold for 7 million then this is what would

happen to the money…. Karen's foreclosure company would now have a claim on 22 million minus

the 11 million investors money. Her foreclosure company would be entitled to about half of the

money. But the property won't sell for 22 million – not even close to that. So if a short sale

of 7 million occurs, Karen's foreclosure company (KFC) would have a stake of about 1/2 of the sale

proceeds (22-11=11 about 50%). The investors now are left with 3.5 million dollars and KFC would

get 3.5 million. How profitable is that? Nice for Karen! In my head, I can see why she is

stalling on these projects. because there was not money transferred during

the foreclosure process, just a name switch. So the mechanic liens stay in place. This is to be deducted

from the investors later of course. Also a bond was purchased from an

insurance company due to the city's demand which guarantees the finishing of these structures. If

Ron failed to perform by the end of the loan term, these bonds kick in and the insurance company

has to pay for the completion of the buildings. Instead what is happening is the insurance

company is suing Karen or EFI and you darn well know that Karen is deducting this from the Fund and first

trust deed money (Ron's project split b/n fractional interest deeds and the Fund). Along with the

short sale, the insurance company's suit, the mechanics liens, taxes and so much more, I'm in

agreement that the investors would be lucky to see 30 cents on the dollar. More like 20 cents.

Say it sells at 7 million……


Insurance company's suit and all else mentioned above say accumulates to 2 million ????


7 mil – 2 mil is 5 mil


50% of 5 mil going to KFC is 2.5 million


50% of 5 mil going to investors is 2.5 million


That works out to .23 cents on the dollar of the 11 million dollars initially invested.


By: Anonymous on 4/20/08

Karen's performance was smooth like asnakeoil salesperson on Thursday. She blindsided everyone with her denigrating coments against those who had the guts to speak up or questioned her. Now, its her turn and this will not be the last. I am sure there is more questinable items out there.

By: Anonymous on 4/20/08

Looks like my suspicion was right after all. Now, we just have to connect the dots. There is more to come


By: Anonymous on 4/20/08

Oh my G_d.


On March 17, 2004 Karen Guth swears under penalty of perjury as follows:


"EFI's largest asset is a note receivable from Republic Properties, which is not collectable."


NOT COLLECTABLE???????????


Stefan

By: Anonymous on 4/20/08

Quote Charlie Applebaum 12/2/2003 in a sworn statement in court in SLO County. Go to the court and see it for yourself.


"The real reason Estate Financial has had to transfer "bad loans" to Republic for workout is that the Respondent (Karen Guth) decided to advance certain funds which were invested by investors on one project, to the builder on another project. This action is clearly inappropriate….."

She has been committing this illegal act of commingling fund since at least 2003, so says her ex-life partner.

By: Anonymous on 4/20/08

http://www.estatefinancial.com

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.

3. HIGH LIQUIDITY

4. MONTHLY INCOME

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 4/19/08

Go to the SanLuisObispo.com and check "local news" and read readers comments at the bottom of the article on "Estate Financial officials try to calm uneasy investors." Post your comments there too. More people need to know what she's doing.

By: Anonymous on 4/19/08

Jill,

check your e-mail.

By: Anonymous on 4/19/08

To 'In the Dark' – Please email me at fullyfunded93401@yahoo.com

By: Anonymous on 4/19/08

To From Encinitas


It is a shame that we are forced to try to find information that should be readily available from Karen but can be obtained only by putting her on the spot in front of 300+ investors.


Are you the borrower WLF Ventures (for a custom deluxe house, 3542 Jasmine Crest, Encinitas, in Olivenhain – Loan #B311-04) and Twin Oaks Estate, 1071 Bates View Court, San Marcos(B355-03)? If you are, can you please tell us the status of those two projects.

1)Can they be sold "as is" and if so, for how much.

2)Is Karen foreclosing on them? If so, when is the date of foreclosure?

3)Do you know if there are any liens against the properties?

4) Do you know if there are any lawsuits involved with these properties?

5) Are you interested or able to obtain funding to buy out investors?

6) Are the WLF Ventures/Olivenhain house and the San Marcos house stand alone projects or are they part of a subdivision, and if so, how many houses are in the subdivision and what state of completion are they in and is Karen involved in funding them?


If you have the information, thanks.