Florida Man Says He, Pastor Lost Homes Through Dade County Land Deal

Monday, April 8, 2013

A Florida man testified Monday in Chattanooga Federal Court that he and his pastor both wound up losing their homes after getting involved in a "too-good-to-be-true" Dade County, Ga., land deal.

Jim Tobin testified in the case in which Joshua Dobson, 35, and Paul Gott III, 40, are charged with money laundering and wire fraud.

Prosecutor John MacCoon said the defendants sold lots at The Preserve at Johnson's Crook near Rising Fawn with no down payment and with no monthly payments for up to three years. He said buyers were told that even after making no payments they might be able to eventually sell their lots at a profit.

Attorney Chris Townley said others committed wrongdoing in the case and that Dobson was more involved in sales on the front end than the closings. He said he was using established real estate practices, including buy-back options and leases.

Attorney John McDougal said it was more of a civil matter than a criminal one. He said the banks "were fine as long as they were making money."

Prosecutor MacCoon said the banks would never have made the loans had they known the sellers were the ones putting up the money and that the buyers "had no skin in the game."

He said in a couple of cases Dobson's Southern Group transferred large sums for down payments and in several others was involved in funneling the money through "gift letters." He said a broker got $500 for posing as the "cousin" of two different buyers and in another case a father persuaded his daughter to sign a gift letter, saying she was helping out her aunt.

He said some of the lots were priced at $250,000, but only worth about $5,000 to $6,000.      

Attorney Townley said mortgage officer Keith Smartt had the idea for the gift letters and assured Dobson it was ok, saying, "The lenders don't care where the money comes from."

He said The Preserve is "a hidden jewel" and the high prices the lots were fetching were justified. He said the developers were adding stables, a clubhouse and a swimming pool as well as a lake with small cabins. He said the project was started not long before the real estate crash.

Mr. Tobin said he was in the business of scanning mortgage documents when he was introduced to Dobson and his brother-in-law, Travis A. Shields, in 2006. He said he signed up for a lot when he was told he would not have to put any money down and that the monthly payments would be paid for him.

He said he was sent a check from the Southern Group for the down payment and he got monthly statements showing his mortgage going down.

The witness said it appeared to be such a good deal that he helped arrange for friend Bob Guice to take four lots and his pastor, Patty Daniels, to sign up for three. He said they also had the payments made for them.

He said in the case of the pastor, the money for the down payment was wired to her bank, but, because that bank would not release the funds for 10 days, it was arranged that the money be shifted to his bank so he could get it the next day. He said the pastor had excellent credit, but no money for a down payment.

Mr. Tobin said at some point he got a call from the mortgage company telling him the payment had not arrived. He said he called Dobson and he said it was just late. The next month, he said, there was no payment and the property later went into foreclosure. He said he lost his own home after filing bankruptcy.

The same thing happened to Pastor Daniels and her handicapped husband, he said "I am embarrassed to say."

Judge Curtis Collier is overseeing the trial, which continues Tuesday.   

 


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