Judge: Son of former Nevada governor "fraudulently concealed information" from lenders
Hard money lender Jeff Guinn, the son of former Nevada Governor Kenny Guinn, “fraudulently concealed information” when he valued four loans brokered by his former company, Aspen Financial, but did not engage in “overarching fraud” on more than 20 loans at issue in a lawsuit filed against Guinn.
Two and a half years after the 2016 bankruptcy court trial, Judge Gary Spraker of Alaska ruled partially in favor of plaintiff Donna Ruthe, who alleged Guinn misled investors who lost hundreds of millions of dollars when loans brokered by Guinn defaulted. Guinn earned broker fees to pool funds from investors, who earned double-digit interest rates making high-risk loans to borrowers.
“Plaintiffs reaped the rewards of these investments for a number of years, but problems emerged when real property values plummeted. Guinn is not blameless here. However, the court finds that there was no overarching fraud,” Spraker wrote.
“First, Guinn ran Aspen loosely,” the judge wrote in his decision. “He relied on appreciating land values to justify Aspen’s hard money loans to local contractors. This worked until 2007, when real property stopped appreciating, and instead depreciated precipitously. By this time, the regular stream of payments Plaintiffs had received from their prior Aspen loans desensitized them to the considerable risk involved in financing hard money loans.”
Read more: https://www.nevadacurrent.com/blog/judge-son-of-former-nv-governor-fraudulently-concealed-information-from-lenders/
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Guinn appeals bankruptcy judge’s ruling
Jeff Guinn, the son of former Nevada Governor Kenny Guinn, is appealing a federal bankruptcy judge’s ruling that he “fraudulently concealed information” from investors on four loans at issue in litigation spanning a decade.
Guinn operated his hard money lending company “loosely” according to Judge Gary Spraker, who issued his ruling two and a half years after the 2016 trial that lasted two weeks.
Guinn is choosing to have his appeal heard by a federal district judge rather than the bankruptcy appeals court, according to the filing.
The Nevada Mortgage Lending Division is declining to comment on the judgment.
Read more: https://www.nevadacurrent.com/blog/guinn-appeals-bankruptcy-judges-ruling/