Judge Blocks an Alleged Antelope Valley Land-Fraud Scheme : Courts: Authorities say Marshall Redman was still collecting $50,000 a month from unwitting Latino investors after being warned his business is illegal.

A judge on Monday blocked a Westside businessman from running what prosecutors allege is a massive land-fraud scheme in the Antelope Valley, after authorities said he was continuing to take in $50,000 a month from unwitting Latino investors after being warned his business is illegal.

Marshall Redman and nine co-defendants already have been accused in a civil case of swindling at least $3 million from investors who responded to ads promising that they could own property in the desert areas of northern Los Angeles, Kern and San Bernardino counties, free of the crime and smog of the city.

Instead, prosecutors allege, Redman and his associates duped perhaps hundreds of investors into buying virtually worthless shares in 10-acre tracts of land that they couldn’t build on because of zoning laws.

Through a civil lawsuit filed Jan. 31, the Los Angeles city attorney’s office is trying to recover at least $3.5 million in restitution and civil fines from Redman, and two businesses that he owns with his wife, son and daughter.

Redman specifically “targeted a population that was vulnerable, people who don’t speak English,” by advertising only on Spanish-language TV stations, attracting mostly Latino victims, a deputy city attorney said.

On Monday, prosecutors alleged to a Los Angeles Superior Court judge that since that January filing, Redman has continued the scheme by pressuring at least 227 alleged victims into continuing to pay a total of $50,000 a month.

According to prosecutors and letters obtained by The Times, Redman’s companies have been reassuring investors that contrary to what authorities are saying, there is nothing wrong or illegal about the scheme, and that they must continue their payments or risk losing their entire investment. “We can assure you that the property you acquired from our company is safe and secure for the future,” said one Feb. 16 letter that demands a monthly $245 payment immediately.

Redman, through his lawyer, denied any intentional wrongdoing, and said he was trying to stay in business so he can make amends.

In an interview, City Atty. James K. Hahn described the business operation as a “classic Western land swindle.” He said he sought the temporary restraining order Monday after learning that Redman’s operation was continuing to collect money from alleged victims and that it may be trying to hide as much as $4 million in profits so it doesn’t have to return the money to the victims, as Hahn’s office is trying to compel it to do.

“Even after we put him (Redman) on notice, his company is still trying to make people keep up payments that they know are at least questionable,” Hahn said.

“That is very disturbing. There’s a lot of money involved here. What we are concerned about is that this money may disappear.”

Hahn said the matter has been referred to the Los Angeles County district attorney’s office for possible criminal prosecution, and a joint investigation involving his office and Kern County authorities continues. Much of the land is located in parts of the Antelope Valley that are in Kern and San Bernardino counties, Hahn said.

Even as they obtained the temporary restraining order Monday from Judge Robert O’Brien, authorities said they were looking into the possibility that others were victimized in the scheme, noting that the county Department of Consumer Affairs received 1,093 telephone calls and 334 written complaints about the land deals after the Jan. 31 civil suit was filed.

The judge’s order forbids Redman and his associates to collect or attempt to collect any money from the alleged victims until an April 6 hearing. The order also freezes the assets of Redman’s companies.

“This was one of the biggest real-estate fraud cases that we have investigated, and we have investigated these for many years,” said Pastor Herrera Jr., director of the consumer affairs agency. “These people were unsophisticated; they were led to believe that there was a dream for them five to 10 years down the road,” Herrera said. “And they discovered they had a real nightmare instead.”

Redman’s lawyer, Daniel Powell, acknowledged that since 1979, his client’s companies have sold hundreds of customers property that they cannot build on, because it is not legally subdivided and zoned for residential construction.

But he insisted that Redman made honest mistakes based on bad legal advice given to him by an Encino law firm that Redman is now suing. He said Redman, 65, of Beverly Hills, is now trying to make amends by refunding customers’ money, paying to have their properties rezoned, or exchanging their property for something nearby where they could build.

“It is a god-awful nightmare. They got screwed, no doubt about it,” Powell said of the investors.

Any demand-for-payment letters sent out, Powell said, were honest attempts by Redman to stay in business. “We acknowledge it is a mess,” said Powell. But, “if he goes under, the customers will have no recourse at all.”

Authorities said Redman and his companies--Redman Investment Co. and Del Sol Properties--had enough experience in real estate to know better.

The companies advertised the scheme as a “fantastic opportunity” only on Spanish-language television stations in Southern California, and then bused potential customers out to the general area before giving them false and misleading statements about the land they were buying and what they could build on it, authorities said.

The 2.5-acre parcels were offered for between $19,000 and $29,000, paid over a 10-year period. But hundreds of alleged victims complained that after finishing their monthly installments, they found that they could not obtain county building permits. Among the reasons: The land had no legal access, the buyers were not legally registered as owners of the land, the parcels were not legally subdivided, or the land was zoned for something other than residential use.

“He is certainly a very sophisticated man who knows the system,” Deputy City Atty. Ruth Kwan, head of the Consumer Protection Unit, said of Redman.