A Florida developer and a North Carolina appraiser have reached plea deals in the Penland real estate scheme, bringing an end to one of this state's biggest fraud cases during the housing bubble.
Under a consent judgment entered Thursday in Wake County Superior Court, Michael Yeomans, a Florida developer, will pay $400,000 in restitution and be barred from working in North Carolina under certain circumstances.
A. Greg Anderson, who signed a consent agreement last month, had his appraisal license suspended until July 2011 and is barred from working as an appraiser in North Carolina during that time. Anderson is also barred from ever conducting appraisals on property where the seller is offering sales incentives of more than $100.
A total of six people entered consent judgments in the Penland case as a result of the investigation by Attorney General Roy Cooper's office.
The Village of Penland was conceived as a 2,000-lot residential and retail development in the Western North Carolina mountains.
But the Mitchell County real estate venture used inflated appraisals to entice consumers, including some from the Triangle, into borrowing millions of dollars to purchase property, prosecutors charged.
Anderson conducted appraisals that substantially overstated the value of property sold to consumers as part of the Village of Penland scheme, according to Cooper's office.
The inflated appraisals were used to qualify consumers for mortgages far in excess of the actual value of the land.
Yeomans earlier pleaded guilty to one count of mortgage fraud in a federal criminal case in U.S. District Court for the Western District of North Carolina.
The four other defendants who entered similar judgments with the Attorney General's Office were Richard Amelung, J. Kevin Foster, Anthony Porter and Neil O'Rourke.
Amelung, Foster, O'Rourke and Porter also paid a combined total of more than $325,000 in restitution.
According to the Cooper's investigation, bogus sales to inside buyers helped artificially inflate the value of the lots, which sold for $125,000 apiece even though their tax values were $20,000 or less.
Many of the lots could not realistically be used to build homes because of their size or topography, and none of the lots included water and sewer systems.
