Dryw Keltz 4:20 p.m., Aug. 20
Western Financial Planning Accused of Running Real Estate Fraud
The Securities and Exchange Commission (SEC) announced yesterday (Sept. 7) that a federal judge has granted its request for a restraining order and asset freeze against Louis V. Schooler and Western Financial Planning Corporation. The company raised about $50 million and didn't tell investors that they were paying an exorbitant markup for land -- in some cases more than 5 times its fair market value, according to the SEC. Schooler and Western failed to inform investors that the land held by the partnerships was often encumbered by mortgages that Western used to help finance the original purchase of the land, says the securities agency. "Schooler conned hundreds of people into investing with Western by leading them to believe that they were getting a good value for plots of vacant land," says Michele Wein Layne, director of the SEC's Los Angeles office. Thomas Hebrank has been appointed temporary receiver over the entities.
On April 20, 2011, and in subsequent blog items, I reported on the problems of a related organization, WFP Securities, which has since closed down. Louis V. Schooler owned 50% of the parent company of WFP at that time. His brother John Schooler was president of WFP Securities. Investors charged that WFP sold investments that later turned out to be Ponzi schemes.