State revokes real estate licenses of Crisp, Cole
| Friday, Sep 26 2008 03:16 PM
Last Updated Friday, Mar 27 2009 01:39 PM
Decision in a nutshell
• Real estate licenses of Carl Cole, David Crisp and former employee Robinson D. Nguyen were revoked in Friday’s decision.
• Former employees Sneha Mohammadi and Jill Louise Pinheiro previously made deals with regulators. Mohammadi agreed to have her broker’s license revoked. Pinheiro, a sales agent, is on probation for two years.
• Revocations are set to take effect Oct. 15 but if appealed could be on hold for months.
Images
David Crisp and Carl Cole
Carl Cole looks through papers before the start of a hearing on his license on Aug. 5, 2008
David Crisp looks over papers before the start of his hearing in July.
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State regulators have revoked the real estate licenses of Carl Cole and David Crisp, a decision released Friday shows.
But the pair, former principals of Bakersfield’s now-defunct Crisp & Cole Real Estate whom regulators accused of mortgage fraud, could continue selling homes for months or longer.
“We do plan to file an appeal,” Cole said Friday. “I just talked to my attorney.”
The revocation is slated to take effect Oct. 15.
An appeal, however, would put Cole’s license revocation on hold until a court decides whether the discipline was fair, a process that could take months, said Tom Pool, spokesman for the California Department of Real Estate, which issued the ruling.
Cole, 61, a broker, currently sells real estate in Ventura under his Points West Group business name.
Crisp, 29, a sales agent, did not respond to a phone message seeking comment. No one answered the door Friday afternoon at his latest known residence, a Southern Oaks home owned by a local broker that defaulted last month.
Friday’s outcome ends, for now, the smaller portion of an investigative drama that unfolded a year ago.
The real estate department filed mortgage fraud accusations against Cole, Crisp and three former employees of Crisp, Cole & Associates’ various operations on Sept. 10, 2007.
Two days later, FBI and IRS agents raided more than a dozen Bakersfield sites related to the company. No charges have yet come from the ongoing federal investigation.
FRAUD, DISHONEST DEALING
The written decision of the administrative law judge who heard the license case shows state regulators successfully argued most of their accusations.
Four legal conclusions were leveled against Cole, the managing broker who was responsible for supervising Crisp & Cole’s various operations.
The judge found:
• Cole made substantial misrepresentations, engaged in fraud and dishonest dealing and willfully disregarded real estate law;
• demonstrated negligence or incompetence;
• failed to properly supervise licensed activities; and
• employed a nonlicensed person to make loans.
A single legal conclusion supported revocation of Crisp’s license: substantial misrepresentation, fraud and dishonest dealing.
Administrative Law Judge Humberto Flores of the Los Angeles division of the California Office of Administrative Hearings heard the case in late July and early August in the basement of Bakersfield’s downtown Masonic Temple.
Flores’ proposed decision was then reviewed and adopted by state Real Estate Commissioner Jeff Davi.
DETAILS
Glenn Kottcamp, Cole’s Fresno-based attorney, called the decision “disappointing.”
He said Cole is “not a danger to society” and his primary error was a failure to supervise. A status reduction to sales agent, for example, would be a more appropriate penalty, Kottcamp said.
The judge’s written response indicates he was persuaded by the real estate department’s attorney, Michael B. Rich, that Cole was guilty of more than lax oversight.
Evidence included loan papers for a $1.4 million mortgage Cole took out in 2005 against a property at 9619 Marseilles Ave. Paperwork showed Cole claimed the Marseilles property would be his primary residence, something that allowed better loan rates and conditions.
During the hearing, Cole and his lawyer said Cole had been careless when signing and initialing some papers claiming primary residency. They said some documents with his signature had been forged.
The judge was not convinced.
“Respondent Cole’s testimony is not persuasive,” Flores wrote.
He called Cole’s residency claim “a substantial misrepresentation of a material fact” that “constitutes fraud and dishonest dealing.”
If a forged letter was in the file, Flores wrote, it showed “Cole’s failure to properly supervise” the company’s lending arm, Tower Lending, created an atmosphere where employees might forge Cole’s signature “without fear of repercussion.”
COSTLY
The Department of Real Estate’s accusation included sales details of only 13 or so houses.
The case was nevertheless among one of the most expensive hearings the department has ever held, said Pool, the spokesman.
The included properties — which netted Crisp & Cole Real Estate about $488,000 in commissions and Tower Lending about $120,000 — represent just a fraction of Crisp & Cole-related transactions in the local market.
An ongoing Californiantally of troubled properties related to the firm shows 138 properties, most in the metro Bakersfield area, that carried about $81.9 million worth of loans. As of mid-September, 120 of those had been foreclosed on.
— Californian staff writer Jenny Shearer contributed to this report.
