Loan fraud probe spurs ‘a lot of confusion’ | TheUnion.com
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Loan fraud probe spurs ‘a lot of confusion’

A group of seven investors and borrowers waited almost two hours Monday afternoon in the lobby of the county court house, hoping to gain insight into the fraud investigation of Thomas Hastert and his Grass Valley company, Loan Sense.

“It’s just a lot of confusion going on right now,” said Wayne Brooks, a Nevada City man who invested in four loans with Loan Sense beginning in 2006. Every one of them is a problem, with two in or near foreclosure; one account is frozen and another out-of-county investment is in “limbo,” Brooks said.

Huddled in the lobby outside the closed-court hearing, Loan Sense clients shared stories about Hastert and his company and scribbled notes.



Hastert, dressed in a gray suit, appeared friendly and smiling when he recognized a client in the group.

His Marysville attorney, Craig Leri, discussed the seizure of documents with Nevada County District Attorney Cliff Newell and Deputy District Attorney Jim Phillips. The




courtroom remained closed throughout the proceedings, although portions of the hearing were supposed to be public.

“Nobody got to go in and hear what was happening,” Brooks said.

Those who came to the courthouse Monday showed frustration over the locked doors.

“I don’t know why the court kept everyone out the entire time,” Newell added.

Grass Valley police, the district attorney’s office and state and federal agencies have been investigating Hastert since January, when a number of people began to report alleged real estate fraud.

On Sept. 21, they seized documents from the Grass Valley office. Since then, more than 40 additional people have come forward alleging problems, Grass Valley Police Capt. Dave Remillard told The Union.

Some documents protected

In the hearing, Judge Thomas Anderson agreed to allow Hastert’s attorney to have copies of the seized documents that pertain to Hastert’s legal clients. Hastert, who also is a lawyer, had his legal office in the same building with the loan company.

Another court date is scheduled for Oct. 18, when the court will continue to look at the current freeze on Loan Sense bank accounts and documents protected by attorney-client privilege.

At 9:30 a.m. Thursday, the Grass Valley Police Department and Nevada County District Attorney’s office will host a meeting for Hastert’s loan clients at Grass Valley City Hall, 125 East Main St. Officers will give an update on the investigation and answer questions about the investigation process.

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To contact Staff Writer Laura Brown, e-mail laurab@the union.com or call 477-4231.


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