<p>I don't know why I can't find this online at the OCR but it was in the print edition yesterday. This I think this qualifies for an "Asshat" award. Especially since one involved has had his home mentioned here. This isn't the first time for these guys to be in trouble.</p>
<p>SEC files fraud suit against Irvine company </p>
<p>Agency alleges it ran a real estate scheme that paid most of its funds to boiler-room operators. </p>
<p><br style="FONT-WEIGHT: normal; FONT-SIZE: 5px; LINE-HEIGHT: normal; FONT-STYLE: normal; FONT-VARIANT: normal" />
By JOHN GITTELSOHN and ANDREW GALVIN
THE ORANGE COUNTY REGISTER </p>
<p>A federal lawsuit was filed against an Irvine real estate firm accused of running boiler-room operations in a $50 million real estate fraud scheme. The Securities and Exchange Commission alleges that <strong>Real Estate Partners Inc. </strong>failed to disclose that 52 percent of its funds raised from 1,600 investors went to commissions. The complaint says $10.9 million went to Michael P. Owens and $3 million went to Donald G. Ryan, 42, alleged to be boilerroom operators from Newport Coast and Irvine, respectively. </p>
<p>Others named in the lawsuit: Dawson Davenport, president of Real Estate Partners, 51, of Lake Forest; and salesmen Richard McGill, 58, of Laguna Niguel; William L. Sanders, 56, of Norco; Michael Tuchman, 38, of Irvine; and Danny Rayburn, 47, of Westminster. </p>
<p>Attorneys for Davenport and Owens declined to comment. Attorneys for other defendants could not be reached for comment. </p>
<p>The complaint alleges that Real Estate Partners ran a Ponzilike scheme, paying dividends to investors with funds raised from other investors. “As demonstrated by this action, investors should always be wary whenever they receive an unsolicited phone call from a high-pressure salesperson,” said Rosalind R. Tyson, acting director of the SEC’s Los Angeles regional office. </p>
<p>“Boiler-room personnel are adept at manipulating investors to convince them to invest in fraudulent schemes.”
</p>
