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Professors Linda Fisher and Jenny-Brooke Condon in the
Center for Social Justice have filed a class-action lawsuit alleging
a widespread practice of illegal property-flipping and real estate
fraud by various individuals and entities in the greater Newark
area. Taking advantage of the real-estate boom and relaxed lending
standards of earlier in this decade, Defendants Maurice Bethea and
his companies Blu Financial, Born Asiatic and Greenfield Asset
Holdings lured over a hundred and fifty people into a real estate
investment scheme that led to great profit for Bethea but
foreclosure and ruined credit for the individual purchasers.
The scheme involved deceiving financially-unsophisticated low and
moderate-income individuals into buying homes in Newark, Irvington,
East Orange and Orange as investment properties. Using the
purchasers’ good credit scores as bait, Blu worked with dishonest
mortgage brokers and appraisers to obtain mortgage funding in excess
of the homes’ value. Blu purchased the buildings at a low price,
partially renovated them and resold them to the unsuspecting
purchasers at prices far greater than their actual worth. Falsely
promising that they would find tenants for the properties and that
the rental income would easily allow the purchasers to make their
mortgage payments, Blu representatives manipulated class members
into buying the properties, but they invariably failed to carry
through on their promises and the purchasers fell into default and
foreclosure.
The named plaintiff Melvin Gibson is a truck driver for relief
operations throughout North America. He was forced to file for
bankruptcy after losing his life savings as a result of Blu’s
deceptive practices.
This lawsuit is not the first case that the Center for Social
Justice has filed against Blu Financial. In April of 2007,
Professors Fisher and Michael Barbosa filed the first of
approximately a dozen third-party complaints against Blu in
foreclosure actions, alleging that Blu’s fraudulent and deceptive
practices caused the Center’s clients to fall into default and
foreclosure on their mortgages. (See April 17, 2007 press release
and complaint, posted on this website.) Scores of Blu victims have
contacted the Center since that time, each of them repeating similar
stories about Blu’s deceptive practices.
Dozens of Seton Hall law students assisted with research and
drafting of the complaint. Recent graduates Carolyn Dellatore,
Nicole Figliolina, Jason Hawrylak, and Ben Zilbergeld prepared the
class action complaint under the supervision of Professors Fisher
and Condon. 1L’s Derek Pahigiannis and Taylor Ward assisted with
final edits and filing. Marshall Kolba, Esq. worked with Center
faculty as a volunteer attorney, providing valuable advice and
assistance.
Inquiries should be directed to the Center for Social Justice:
973-642-8700.
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Professor Linda Fisher
Civil Litigation Clinic
Visiting Professor Jenny-Brooke Condon
Civil Litigation Clinic
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