Clearwater condo fraud case leads to federal indictments

Published September 17 2014
Updated September 18 2014

CLEARWATER — Back when everybody seemed to be making money in real estate, Fred Davis Clark and Cristal Clark helped to assemble multimillion dollar development plans that stretched from Clearwater to the Florida Keys, Las Vegas and the Caribbean.

But a new federal indictment claims the Clarks were making their money the old-fashioned way: with a Ponzi scheme.

The Clarks helped build "a $300 million fraud scheme involving the sale of vacation rental units to approximately 1,400 investors," according to a statement this week from the U.S. Attorney's Office for Florida's Southern District. They have been charged with bank fraud and conspiracy to commit bank fraud.

The Clarks were part of Cay Club, which lured investors into Clearwater condos bordering Tampa Bay, not far from U.S. 19. The Club said the condo complex was going to be part of an attraction that would rival Disney World.

The Clarks' operation also involved properties in the Florida Keys and elsewhere.

Investors paid up to $600,000 and $700,000 for the condos, which they later could not unload for even $200,000.

Although a lot of people lost money after the real estate collapse in 2008, Cay Club investors said they lost money because of fraud. Some had been given doctored appraisals based on insider transactions to make the high purchase prices seem legitimate, according to previously filed lawsuits.

Some investors were thrilled this week to hear of the indictments, said Bruce Barnes, a Safety Harbor attorney who represented them.

"It's nice that the justice system, at least as of now, has caught up with two of the scoundrels," Barnes said, adding that "this scam really impacted hundreds of people."

The Clarks also have been accused of fraudulent activities in connection with a Cayman Islands-based company, and of hiding $2 million in a Honduran bank account.

The Clarks "were expelled from Panama and Honduras, respectively, in June 2014, and were ordered detained pretrial by U.S. Magistrate Judge Lurana S. Snow," according to the U.S. Attorney's Office.

Fred Clark, who went by "Dave Clark" and is 56, and Cristal Clark, who is 41, are now awaiting trial. The Securities and Exchange Commission also filed a complaint against Cay Club officials last year.

Contact Curtis Krueger at [email protected] or (727) 892-8232. Follow @ckruegertimes.

Advertisement