North County lenders headed to trial for misleading investors — again

Rodney Virgil Jarmin, pictured, and Tammy Marian Jordan, former co-owners of Real Property Lenders, will take their fraud cases to trial, more than six years after they were first arrested.
Rodney Virgil Jarmin, pictured, and Tammy Marian Jordan, former co-owners of Real Property Lenders, will take their fraud cases to trial, more than six years after they were first arrested.

Two years after they came within hours of going to trial on fraud charges, two former North San Luis Obispo County lenders accused of scamming investors may be headed to trial again.

The fraud case against Rodney Jarmin and Tammy Jordan, former owners of Real Property Lenders, has been so “long and convoluted,” as one judge put it, that the District Attorney’s Office has dedicated a web page to keep updated an angry group of investors aggravated by the prosecution’s slow pace.

Since March 2011, Jarmin, 76, and Jordan, 54, have faced seven counts of selling securities by means of false statements or omissions.

During the third day of jury selection in June 2015, they reached a surprise plea deal with the then-prosecutor that reduced their felony counts to misdemeanors, requiring no jail time and under $115,000 in combined restitution.

County probation officials had initially recommended roughly $8.2 million based on claims submitted by about 80 investors.

But based on the specific charges they pleaded to, Superior Court Judge Gayle Peron in July ruled that the two owed approximately $363,000 to 14 people who lost money between June 2007 and January 2008, the dates designated in the prosecution’s charging documents.

In response, Jarmin decided in July to reject the deal and instead go to trial on the original felony counts. On Tuesday, Jordan told Peron she will too.

Jury selection is scheduled to begin Oct. 16. It’s unclear what jail time or restitution the two could face if convicted of all counts. Deputy District Attorney Eric Dobroth on Tuesday said that will be under review leading up to an Oct. 3 readiness conference.

Jordan’s attorney, Pierre Blahnik, wrote in a 2015 court motion that the defendants never intended to mislead investors; he blamed a technical error, bad legal advice from another attorney, and the collapse of the housing market in 2007. His client never profited from the business, he wrote, and she lost her own home in 2010.

James Pope, a Real Property Lenders investor who’s long been critical of how the DA’s Office handled the case, would have been awarded about $73,000 under Peron’s restitution order. He and several of the alleged victims are happy to see the case move forward.

“I do not expect to experience any more derailments that have doubly victimized us in this case,” Pope said.

Both defendants were co-owners of the business that acted as a middleman between investors who put up money to be used as loans for developers in real estate projects. Investors were promised annual 12 percent interest payments on their investments, according to court documents.

So-called “hard money” lenders provide loans to borrowers more quickly, but at higher interest than banks. For investors, they’re considered high-risk/high-return investments.

According to a document filed with the state Department of Corporations, Real Property Lenders reported more than $55 million worth of outstanding real estate loans in 2007.

Jarmin and Jordan were charged in March 2011, with prosecutors alleging they didn’t disclose to investors that the builders they loaned to had defaulted and that previous investors had not been paid dividends.

However, after the judge accepted the 2015 plea deal — the result of miscommunication, the DA’s Office said — prosecutors challenged the move, saying the agreement should have been for felony charges. Further, under the state’s Victim’s Bill of Rights — also known as Marsy’s Law — victims in the case should have been notified of any changes ahead of time, they said.

The judge who accepted the deal later pulled it, a decision Jarmin and Jordan’s attorneys appealed. In February 2016, the state Appellate Court issued an informal decision saying that San Luis Obispo Superior Court should honor the deal it accepted. A second Superior Court judge agreed in March 2016.

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