St. Louis, Mo., June 16, 2010
- A businessman from Lake St. Louis, Mo., who was barred from the commercial loan business in the state after allegations that he cheated consumers out of hundreds of thousands of dollars, appears to have returned to the same type of business that first landed him in hot water with the Missouri attorney general’s office in 2004.
The Better Business Bureau (BBB) suggests caution when doing business with James France
, who describes himself as the owner of US Underwriting
, 400 Lake St. Louis Blvd. in Lake St. Louis. France is the former vice president of American Federal, Inc.,
which has done business under the name AmBanc
and which formerly had offices in St. Charles, Mo.
France and American Federal entered into an agreed judgment with the attorney general’s office in 2008, four years after the lawsuit was filed. The agreement permanently bars them from “arranging for or funding non-residential loan transactions for any third party in the State of Missouri.”
But two recent complaints filed with the BBB indicate that France continues to market himself as an entrepreneur who can locate investors for multimillion-dollar projects – the same kind of work he was doing when he was sued by Missouri.
France has told the BBB that he is not violating terms of the court agreement because, “any corporations I have are in Kentucky and Delaware” and “I do not do any deals with residents of Missouri.”
The two recent complaints, one from Texas and the other from Colorado, allege that France and US Underwriting were paid a combined total of nearly $10,000 to help find funding for commercial projects in those states.
In the Texas deal, France was supposed to help locate investors for a $40 million apartment project. The other deal reportedly involved a promise to help find investors for a $23.5 million wind farm project in Colorado. Both complainants said France had promised that he would refund most of the upfront money should he not be able to find investors, but then refused to return the money.
“If there was a way to get the cops to show up at his door, I would do it,” said the Colorado businessman who said France took $3,700 from his business without any results.
Michelle Corey, president and CEO of the BBB, said the recent complaints seem to show a continuing pattern of deceptive activity. “Mr. France already was on notice that the state was not going to tolerate this kind of behavior. Businesses should understand that while he has changed the name of his business, his game remains the same.”
The attorney general’s case alleged that American Federal, James France and American Federal’s president, Michael P. Maurer, violated the Missouri Merchandising Practices Act by advertising and selling mortgage banking services to consumers seeking financing for commercial projects.
They then charged borrowers “commitment fees” in return for banking services that they failed to perform.They refused to refund those fees to the borrowers, the state said. “Moreover,” the state said, “defendants strong-armed several borrowers into signing Hold Harmless and Indemnity Agreements by refusing to return commitment fees without the borrowers first executing the agreements.” The state said the agreements were illegal.
The case detailed 26 separate borrowers who were victimized by the scheme. The borrowers included a businessman hoping to purchase a hotel in St. Thomas, Virgin Islands; a couple trying to raise money to build a travel center in Texas; a businessman hoping to buy a casino in Las Vegas and a company trying to obtain funding for an ethanol production facility in Missouri.
In all of the cases outlined, the state said American Federal and the two men told borrowers they qualified for loans totaling more than $620 million. In those cases, the state said the defendants collected nearly $1 million from the borrowers in “due diligence deposits” and “commitment fees.” Much of that money was never returned, the state said, despite the inability of France, Maurer and American Federal to obtain financing.
In an e-mail response to the BBB, France called the settlement with the state “a joke.” France said in the e-mail that “out of several thousand transactions or requests we had a dozen or so that went screaming to the Attorney General.
“They [the state] also found out after a three year education that there was little or no substance to any of the representation that had been made. In return I got them to go away and stop bothering me.”
The Missouri attorney general’s office is investigating recent complaints involving France and US Underwriting. Persons with information about France or his company may contact the office.
The Texas businessman in the most recent BBB complaint said his company agreed to pay France an upfront fee of $6,200. Of that, $1,200 was for travel expenses, the businessman said. The remaining $5,000 was supposed to be refunded if France and US Underwriting could not locate financing for the project.
The businessman said France said he had helped locate investors for the movie “Avatar,” knew several “big-time players” in the investment world and worked as an expert witness for the FBI. “We spent countless hours putting things together for this guy.” Despite the fact that France never found financing for the Texas project, the $5,000 was never refunded, the businessman said.
The BBB suggests caution when dealing with any business with which you are not familiar. Be wary of making upfront payments to anyone you have not researched thoroughly and check with the BBB for company Reliability Reports by going to www.bbb.org
or by calling 314-645-3300.Contacts:
Michelle Corey, President & CEO, 314-645-3300, email@example.com
, or Bill Smith, Trade Practice Investigator, 314-645-3300, firstname.lastname@example.org