Paul Jablonski

Rancho Tembabichi: the 21,326 acre beachfront property in Mexico touted by the principals of Pacific Imperial Railroad, operators of the controversial Desert Line, as collateral for a loan to pay for repairs on the line as well as to lure investors.

Around 2012, Pacific Imperial Railroad president Donald Stoecklein and others from Pacific Imperial Railroad began informing investors and the board members from Metropolitan Transit System one of the company's shareholders and current chairman of the board, Dwight Jory and his Gold Mountain North, LLC was willing to use the property for the railroad. The estimated worth, Stoecklein told Metropolitan Transit System officials, was $550 million.

But new information has surfaced about Rancho Tembabichi: the value is nowhere close to $550 million, and neither Jory, nor his Gold Mountain North, own the property. But Jory is tied to the property in other ways: he was named as one of the participants in a 2012 criminal investigation of Nevada Superior Court judge Steven Jones, who was accused of taking part in investment schemes with known felons, as well as confiscating marijuana while sitting in on a family court hearing and taking it home.

In the case of Rancho Tembabichi, according to the investigation obtained by Reader, then–superior court judge Jones accompanied Jory and his business partner Victor Hancock to Tijuana where they met with Tembabichi owner Linda Chavez. At the time, Hancock and Chavez were said to be involved in a land dispute. To help resolve the issues, Judge Jones accompanied Jory and Hancock to "compel and/or convince Ms. Chavez to settle" the dispute. At no time, according to the complaint, did Jones inform Chavez that Hancock was a convicted felon, "even though Judge Jones was aware of that fact."

Jones's presence violated federal law, according to the legal complaint later filed with the U.S. District Court, which prohibits a judge "from lending the prestige of judicial office to advance the private interests of the judge or others."

But Jory and Jones's history goes much further back. From 2002 to 2007, Jones helped Jory and his colleagues in finding money for their company, Golden Resort and Movie Inc. Jones's role was to vouch for Jory and his business partners as well as to encourage the would-be investors that the investment was a smart business choice. According to the complaint, Jones, Jory, and others managed to raise $60,000 from three investors in that scam alone. In all, Jones was named in investment schemes worth over $2 million. He is currently awaiting trial.

As to Jory's claims on Tembabichi, they were dealt another hit in June of this year in a deposition from attorney Antonio Maldonado, an expert in U.S. and Mexican law. According to his testimony, Maldonado researched the ownership of Tembabichi and found the ownership to be in the Chavez family (Linda Chavez has since passed away). However, in 2008, Jory, through another one of his many companies (Baja Mexican Riviera S.A.), attempted to purchase the property from Chavez for $1.4 million.

Concluded Maldonado, "there is no indication in the purchase agreement or in the acknowledgement that the purchase agreed to by means of the purchase agreement was ever closed."

The new information of Tembabichi and Jory's involvement makes Metropolitan Transit System's support for Pacific Imperial Railroad that much more suspect.

In recent weeks, the transit agency has come to the defense of Pacific Imperial Railroad and the 99-year lease they entered into with the company, despite news of previous drug busts, outstanding tax payments, and other allegations of fraud.

In a July 9 letter to congressmen Duncan Hunter and Jeff Denham, representatives from Metropolitan Transit System dismissed questions surrounding Rancho Tembabichi. "[Pacific Imperial] informed [Metropolitan Transit System] that it owned a large property in Baja California that its shareholders were willing to put up as collateral for a project loan, if this was something that was requested by investors/financial institutions. [Metropolitan Transit System] did not take a position as to the appropriate financing method for the project and therefore did not substantially participate in any discussions about how [Pacific Imperial Railroad] planned to finance the project."

The dismissal prompted a follow-up letter from Hunter.

"Is [Metropolitan Transit System] aware of these details specific to Pacific Imperial Railroad and its assets? Does this cause any immediate concerns for [Metropolitan Transit System]?"

Transit agency chief Paul Jablonski responded with a quote from their July 9 letter.