The multimillion-dollar loan deal unraveled earlier this year like a thread on a cheap suit.
A Tampa attorney called a lender that had agreed to give Pinellas resident Marc G. Allen's investment company a $3 million loan. The money was supposed to pay off a mortgage on a condominium complex owned by Allen's father.
The money had been deposited in a Miami bank. The lawyer, who represented the mortgage holder supposedly getting the money, said that was a big problem.
The mortgage holder didn't have an account in Miami.
So began the strange case of what attorneys say in legal filings is an elaborate fraud involving loans to Allen's company or associates that eventually totaled nearly $5 million.
In court papers, attorneys for two lenders say an examination of documents produced to get the loans reveal an astonishing variety of forged papers.
Attorneys in U.S. District Court in Tampa and Pinellas circuit court are now fighting over the recovery of the money and the foreclosure of the 141-unit, $9 million Palm Harbor condo complex, Harbourtowne of Countrywoods.
This week, an attorney for the lender that provided the $3 million loan, Bloomfield Institutional Opportunity Fund of Michigan, asked a federal judge in Tampa to order unspent loan proceeds deposited in an interest-bearing account Allen cannot access.
None of the parties involved in the case could be reached for comment this week, including Allen, 49, of Palm Harbor, and his father, California resident William Allen.
The case begins with the cash purchase of the $9 million condominium complex.
William Allen, a man in his 80s who suffers from a variety of health ills, bought Harbourtowne in 2006. At some point, his attorneys say, Marc Allen forged a power of attorney for his father allowing him to conduct the fraudulent business that followed.
Starting in 2007, Lawrence Shapiro, a Virginia resident, agreed to loan what eventually totaled about $1.9 million to a person he believed to be William Allen. The loan was secured by a mortgage on Harbourtowne.
Then in March 2010, Allen Investment Properties, a company owned by Marc Allen, obtained the $3 million loan with Bloomfield, documents show. That money was supposed to pay off Shapiro's mortgage on the condo complex.
But attorneys say Marc Allen, without the knowledge of Bloomfield or Shapiro, formed a corporation called Lawrence Shapiro Lending. Marc Allen even signed incorporation papers using his own name.
The Miami account in which Bloomfield's loan was deposited was controlled by that fraudulent company, not by the real Shapiro, lawyers say.
Not long after, Shapiro's Tampa attorney called Bloomfield with the bad news that the money appeared to have been diverted, according to court papers.
Bloomfield officials put all loan documents under a microscope. What they say they found was a web of forged papers, among them: a letter showing Shapiro's mortgage had been satisfied, a letter of credit guaranteeing Bloomfield's money, papers showing the condo was properly insured, and a Harbourtowne deed filed in Pinellas transferring the property from the father to the son's company.
While William Allen has been named in lawsuits filed by Bloomfield and Shapiro, his attorneys said he had no knowledge of the loans and that the father was defrauded along with the lenders.
"The son received the money," Jonathan Ellis, an attorney for William Allen, told a Pinellas judge last year.
No criminal charges have been filed against Marc Allen or anyone associated with him, though attorney Alyssa Nohren, representing Shapiro, told the same judge, "I would think there is going to be criminal prosecution of the son."
William R. Levesque can be reached at firstname.lastname@example.org or (813) 226-3432.