Builder Is Indicted in Fraud Case

An Orange County home builder was charged Wednesday with diverting $340,000 in construction funds for his own use and unlawfully selling homes at a development in Altadena that was left unfinished.

Timothy N. Roberts, freed on $175,000 bail after surrendering to authorities, will be arraigned Oct. 2 and could face up to 13 years in prison if convicted on all 16 felony counts, said Sandi Gibbons, spokeswoman for the Los Angeles County district attorney’s office.

Prosecutors allege that Roberts defrauded at least eight victims who had agreed to pay more than $700,000 for homes in the upscale La Vina Estates in Altadena. The buyers allegedly made $10,000 deposits on their homes, which were 4,000 square feet and larger, and paid Roberts thousands more for upgrades.

Brea police, meanwhile, said Wednesday that they are investigating whether Roberts defrauded nine people who signed contracts to buy homes that his company, Compass Homes, built at the Yorba Linda Estates development. Residents have complained that the homes were left unfinished and that upgrades that they had paid for were never made.

The alleged losses in Yorba Linda came to about $300,000, said Brea Police Sgt. Jack Conklin.

According to the indictment unsealed Wednesday, Roberts shifted the funds for the La Vina Estates in Altadena between September 2000 and May 2001, when lenders foreclosed on the project. The funds were intended to pay for labor, materials and equipment related to the project. In earlier statements, prosecutors said Roberts used the funds to cover his corporation’s expenses.

The indictment also alleges that Roberts sold the La Vina lots even though he knew contractors had filed liens against the properties.

Roberts, a Villa Park resident, did not return phone calls seeking comment.

Creditors foreclosed on Roberts’ La Vina Estates project last year after 25 of its 26 homes sat unfinished for a year. Most buyers said they were unable to recover any of the money they put into the homes and were required to pay thousands more to cover payments on loans made to the developer and other costs. Those who bought homes in Yorba Linda Estates made similar accusations. In all, 12 families allege that after moving in, they had to pay contractors to finish their homes and pave sidewalks and streets in the tract. The families said they were unable to recoup money they paid for upgrades.

After Roberts was forced into involuntary bankruptcy, the Yorba Linda residents hired attorneys to negotiate with the home builder’s lenders, who had started foreclosure proceedings against his company. A settlement was reached earlier this year allowing residents to remain in their homes, which they were required to buy at higher prices.