Developer to Repay Buyers in Fraud Case

A Westside businessman agreed Wednesday to turn over about $30 million in assets and pay $580,000 to settle a lawsuit alleging a massive land-fraud scheme in the Antelope Valley.

Los Angeles Superior Court Judge Ernest Hiroshige approved the settlement Wednesday, ending a suit that named developer Marshall Redman, three of his real estate companies and 10 others accused of selling desert land to unwitting investors, most of them Latinos.

Lawyers and others involved in the case said later Wednesday that the settlement should provide for about 1,250 unhappy investors who thought they were buying 2 1/2-acre home sites touted in advertisements on Spanish-language TV stations.

According to the lawsuit filed last year, buyers were actually sold shared interests in 10-acre parcels--and could do nothing on the land without the agreement of others who were also sold an undivided interest in the same parcel.

The suit also said parcels frequently were not zoned for homes.

Los Angeles City Atty. James Hahn on Wednesday called it a “classic Western land swindle.”

The Kern County district attorney’s office joined in the lawsuit, which alleged unfair business practices, because the 2,500 parcels of land were spread across Kern and Los Angeles counties.

Under the settlement, a receiver took permanent control Wednesday of about $30 million in assets owned by the three real estate companies.

The $580,000 includes $330,000 in fines and $250,000 in attorneys’ fees and other costs. Criminal charges are unlikely, Hahn said.

Donald Henry, the Woodland Hills-based receiver, said he expects that it will take three to five years to repay some investors, help others find alternative sites and help some clear title defects if they want to keep the land.