California Deputy Attorney General Maggy Krell has dismissed charges against Jonathan Blinder in the high-profile Gold Country Lenders fraud case.
Blinder had been charged with four felony counts of securities fraud.
“I am pleased that I can finally put this ordeal behind me,” Blinder said after the hearing in Nevada County Superior Court Tuesday morning. “To those who have supported me and believed in me through this time, I am extraordinarily grateful. To those who don’t personally know me, but heard about the charges, I hope this helps puts some of their questions to rest.
“I hold no hard feelings and am grateful the judicial process worked for me, despite how painful it was,” he added. “It is my intention to move forward, to get back to selling commercial and residential real estate, helping to build this community and continue participating in supporting the arts.”
“Obviously, the Attorney General reviewed the case and decided there was no need to prosecute him,” said Blinder’s attorney, Malcolm Segal.
Krell said Blinder was cooperating with her investigation and has agreed to testify in the case that remains against Phil Lester and Susan Laferte, who both have been charged with 66 felony counts of elder abuse, securities fraud and conspiracy.
“The agreement is, he will make himself available as a witness and tell the truth no matter which side calls him, and no matter which side it helps or hurts,” Segal said.
Krell has alleged that Gold Country Lenders engaged in a pattern of theft and fraud-related crimes for over eight years, bilking investors of more than $2.3 million.
Blinder is well-known in western Nevada County, helping to found The Center for the Arts and serving on its board from 2000 until late 2011.
In February 2012, Blinder was hired as the executive director of the Economic Resource Council, helping to land a $120,000 contract from Nevada County in exchange for management and oversight of the county’s efforts to enhance tourism. Following his arrest, Blinder resigned his position with the council; he indicated Tuesday that he might rejoin one of its committees.
The charges against Blinder stemmed from his role as chief operating officer of Enlibra LLC, a real estate holding company created by Lester in 2004.
Lester and Blinder met in 2002, when Gold Country Lenders provided Blinder a $600,000 loan to purchase the building on West Main Street in Grass Valley that is now the headquarters for The Center for the Arts. Blinder purchased the building and donated his equity to the center in 2003.
Lester and Blinder then became business partners, as Blinder invested in the South Auburn Street Project, a proposed Grass Valley development. Lester created Enlibra for the sole purpose of developing the project and enlisted Blinder’s help, according to the Attorney General’s arrest declaration.
The state Attorney General’s office maintained that Blinder failed to make necessary disclosures to investors regarding the ownership of properties and use of funds, as well as toxic waste issues.
But during a December 2012 interview with The Union, Blinder’s attorney, Malcolm Segal, said that far from willfully misleading investors, his client tried to put a very complex set of real estate holdings in order, and continued to help investors recover some of their money.
Blinder invested a substantial portion of his own money into the projects, Segal said at the time.
Laferte and Lester were indicted in mid-January by a criminal grand jury for allegedly defrauding investors of millions of dollars over a period of eight years, and the grand jury indictment superseded the original complaint against those two defendants.
Their trial was scheduled to start April 9, but has been pushed back to June 4; they are set to return to court for a pre-trial conference Thursday.
To contact Staff Writer Liz Kellar, email firstname.lastname@example.org or call 530-477-4229.