Investors Allege USOC Developer Misused Funds
COLORADO SPRINGS – We’re following the money trail in the new United States Olympic Committee building downtown. Lawsuits filed against the developer’s manager, Ray Marshall, have raised questions about the USOC deal and other business ventures Marshall is involved in. LandCo is the developer building the new USOC headquarters at the corner of Tejon and Colorado. Ray Marshall oversees LandCo and a number of other Limited Liability Corporations (LLC’s) in Colorado Springs.
Two lawsuits filed this past summer allege that Marshall misused funds from his other LLCs and may have used some of that money to help secure LandCo’s deal with the city of Colorado Springs and the USOC.
One lawsuit brought forth by local investor Jack Mason, on behalf of Mason Investments and North County Land, alleges that Ray Marshall misused North County Land money. When asked for an accounting of North County Land funds, the lawsuit alleges that Marshall first refused. An independent accounting firm was able to review the records and found that $1,665,067 of North County Land money had been improperly transferred to several different LLCs managed by Ray Marshall. This case was eventually settled.
The second lawsuit, brought forth by investor Ward Berlin, as part of HOBO Investments, also alleges that Marshall misused money from multiple LLCs.
Berlin alleges in a sworn affidavit, “It was my impression that virtually all available funds from loans and investors in LandCo’s various projects were being used to pay general LandCo corporate expenses, leaving little to no funds for actual development of the projects involved – thus, seriously jeopardizing the ability of the project involved to be successfully completed and essentially ‘putting them on the shelf’ while Marshall used the Investment LLCs’ funds to pursue the USOC deal for LandCo’s benefit, to the detriment of each of the various Investment LLCs.”
The lawsuit also alleges Marshall sold the asset, land and buildings from one LLC to another new LLC, also owned by Marshall. The lawsuit then alleges Marshall was able to obtain a loan for nearly twice the amount of the sale.
Berlin alleges in the sworn affidavit, “Marshall’s approach on many of his projects was to contact the owner of a subperforming property, and for a 40%-55% ownership interest in the property, he would promise to get the property refinanced by selling it to a new entity created by Marshall at a significantly higher price, then use that higher price to obtain an appraisal upon which he would obtain a new, larger loan, the cash from which would then be used to pay off the prior loan, return some of the balance to the initial owner, and distribute the balance to LandCo. It was my impression and belief that Marshall then used this money to fund LandCo’s general corporate activities, a substantial (if not overwhelming) portion of which was used to secure the USOC deal for LandCo.”
In responding to the claims against Marshall, documents show Marshall’s attorneys deny the allegations about misuse of funds.
This case is currently on hold. District Attorney Dan May is investigating the allegations Marshall misused funds, based on the information from the Mason lawsuit.
NEWSCHANNEL 13will continue to follow and investigate the claims in these lawsuits.
