Orange County real estate lender Dan J. Harkey is being sued by investors for $15 million. Mr. Harkey, who’s married to State Assemblywomen Diane L. Harkey (R-Dana Point) (more on her later), is said to have mislead investors with slick marketing tactics which included the mass mailings of DVD 's featuring Harkey leading investor meetings. If anyone has one of these please feel free it in.
Mr. Harkey is said to have paid off non-renewing investors with money from new investor. The alleged ponzi scheme, has purportedly been reported the Security and Exchange Committee and the FBI have been notified. The former has said to have subpoenaed thousands of documents.
The lead Plaintiff in the case, retired Orange County attorney Lloyd Charton, said he was owed more than $1 million and had this to say about Orange Counties Bernard Madof, "He scammed us. The representations that Dan Harkey made about the safety of the loans were untrue. He was bringing in new money to pay off investors on the same loan, and that's a Ponzi scheme."
To add further intrigue, the lawsuit claims that a portion of the proceeds were used to finance the Mrs. Harkey's recent election campaign. Shockingly, Dave Gilliard, the assembly woman's political consultant has said that the $1.7 million she contributed to herself was money she had made independently of her husband.
In his defense, Mr. Harkey contends that he’s a victim of the current state of the market and called the ponzi scheme allegation "nonsense". Whether the allegation will stick has yet to be seen, but I suspect these type of stories will began to appear more frequently.
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