Jeff Heilmann: Where’s the common sense? |

Jeff Heilmann: Where’s the common sense?

Concerning the Lester and Laferte trial, we have a hard time understanding how fraud with malice occurred when both of these individuals had their own funds invested in these properties.

This makes no sense. This was hard money lending. Hard money lending is high risk with high reward (high interest lending).

The individuals who go after hard money generally cannot secure a loan from a normal lending institution due to overextension or poor credit.

This is the high risk. These rates generally are 10 percent higher than what a typical bank would charge. This is the high reward.

People investing money with hard money lenders shouldn’t invest more than they can afford to lose at a blackjack table.

These investments are subject to the economy. When the economy is good, returns are good. When the economy turns bad, as it did in the investments with Gold Country Lenders, returns dry up, and sometimes foreclosures occur.

How can this be securities fraud? A broker convinces an individual to buy a stock, being told how it will increase in value, then it tanks. Is this not the same thing? Remember all the 401Ks back seven to 10 years? Are those brokers guilty of securities fraud?

Jeff and Debbie Heilmann

Nevada City

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