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GRAND JUNCTION, Colo. — The advertisements touted returns of 10 and 12 percent on the dollar. All an investor had to do was pony up a minimum of $10,000, then sit back for 12-24 months and collect the money.
The investments were “secured and recorded on a trust deed,” and were “not affected by the stock” market. A “solid security,” the ads stated.
That apparently turned out to be too good to be true for investors of Valley Investments Inc.
“There was something goofy,” said J.D. Miller, who heads Miller Financial Advisors of Grand Junction. “I was asked about that by a couple of people. What stood out was that they were promising to pay way above market rates.”
Dennis Edson, chairman of Unifirst Mortgage in Grand Junction, agreed saying the ads seemed far-fetched.
“The old typical high risk, high return,” said Edson, who co-founded his firm about 22 years ago. “I had my doubts.”
The ads later drew the attention of Colorado Securities Commissioner Fred Joseph, who filed a complaint in May alleging Valley Mortgage Inc. and its owner Philip Lochmiller were violating the state's securities act.
Valley Mortgage Inc. does business as Valley Investments.
The investments were apparently to be secured by a recorded trust deed in the investor's name “for individual lots in increments of $20,000-$30,000 at a 50 percent loan-to-value,” the complaint stated.
The complaint was filed in Denver District Court.
Miller said it boiled down to people wanting to make some easy cash. He likened it to a Ponzi scheme in which returns are paid to separate investors — sometimes by their own money or money from subsequent backers rather than actual profits.
“If it doesn't make sense, it doesn't make sense,” he said. “It sounds stupid but it's really right in that case.”
Valley Investments has also drawn the attention of the Federal Bureau of Investigation, who has been probing the matter for more than a month.
“We are looking into allegations of fraud,” said special agent Kathy Wright on Tuesday. “There have been no charges filed.”
Wright declined to say how much money investors lost in the alleged fraud. The FBI has also set up a hotline at 303-575-7012 for anyone who invested with Valley Investments, Valley Mortgage or Lochmiller.
Reach Wyatt Haupt Jr. at whaupt@gjfreepress.com.
The investments were “secured and recorded on a trust deed,” and were “not affected by the stock” market. A “solid security,” the ads stated.
That apparently turned out to be too good to be true for investors of Valley Investments Inc.
“There was something goofy,” said J.D. Miller, who heads Miller Financial Advisors of Grand Junction. “I was asked about that by a couple of people. What stood out was that they were promising to pay way above market rates.”
Dennis Edson, chairman of Unifirst Mortgage in Grand Junction, agreed saying the ads seemed far-fetched.
“The old typical high risk, high return,” said Edson, who co-founded his firm about 22 years ago. “I had my doubts.”
The ads later drew the attention of Colorado Securities Commissioner Fred Joseph, who filed a complaint in May alleging Valley Mortgage Inc. and its owner Philip Lochmiller were violating the state's securities act.
Valley Mortgage Inc. does business as Valley Investments.
The investments were apparently to be secured by a recorded trust deed in the investor's name “for individual lots in increments of $20,000-$30,000 at a 50 percent loan-to-value,” the complaint stated.
The complaint was filed in Denver District Court.
Miller said it boiled down to people wanting to make some easy cash. He likened it to a Ponzi scheme in which returns are paid to separate investors — sometimes by their own money or money from subsequent backers rather than actual profits.
“If it doesn't make sense, it doesn't make sense,” he said. “It sounds stupid but it's really right in that case.”
Valley Investments has also drawn the attention of the Federal Bureau of Investigation, who has been probing the matter for more than a month.
“We are looking into allegations of fraud,” said special agent Kathy Wright on Tuesday. “There have been no charges filed.”
Wright declined to say how much money investors lost in the alleged fraud. The FBI has also set up a hotline at 303-575-7012 for anyone who invested with Valley Investments, Valley Mortgage or Lochmiller.
Reach Wyatt Haupt Jr. at whaupt@gjfreepress.com.
