From the Union Leader this morning......
By DENIS PAISTE
New Hampshire Union Leader Staff
MANCHESTER – Attorney Chris Carter, who is representing a Texas couple in a suit against Financial Resources Mortgage Inc. -- the shuttered Meredith company under investigation by state and federal officials -- says his only surprise is that authorities didn't take action sooner against the company and its principal, Scott Farah.
Carter said he communicated his concerns to authorities at least three years ago.
Since Financial Resources Mortgage and related entities closed abruptly Nov. 9, state and federal investigations have begun.
Civil suits have been filed in both Belknap and Merrimack superior courts seeking to recover more than $23 million on behalf of people who say they invested with Farah.
"I've dealt with this company for seven years, and during that period I've been involved in four separate lawsuits with them," Carter, of HinckleyAllenSnyder LLP in Concord, said in a telephone interview.
Each of those prior suits was settled out of court, he said.
"During that period of time, I have personally seen objective, documented proof of fraud being committed by Scott Farah, Financial Resources Mortgage and other individuals involved with him," Carter said.
"Therefore it is not surprising to me that this most recent disaster has occurred," he said.
►Mortgage firm's investors head to court tomorrow
►Investors wonder: Where did all the mortgage firm's money go? (2)
►Troubled mortgage firm under water
►FBI looking into mortgage firm's closure (9)
Attorney Michael D. Ramsdell, of Orr and Reno in Concord, who represents Farah, did not immediately return a phone call yesterday.
"The full extent of the fraud in the case of my client is not yet known and cannot be until we obtain further information during discovery," Carter, who is a former New Hampshire prosecutor, said. "At this point given the claims filed by other individuals, we have serious concerns about the legitimacy of any of these transactions."
Carter served in the New Hampshire Attorney General's Office from 1997 through 2001, leaving as a senior assistant attorney general in the homicide unit. He also prosecuted white collar crime.
Carter is currently representing Chris and Robert B. Furgerson of Houston, Texas, in a civil suit filed in Belknap County Superior Court to recover $1.6 million.
Among previous cases in which he represented clients against Farah were National Inspection and Repair of Topeka, Kansas, and Ronnie Stone, Carter said.
"I've seen numerous instances where Scott Farah induced people, including members of his church, to invest money in what he claimed were legitimate investment opportunities with Financial Resources," he said.
Farah "provided the individuals with paperwork identifying those alleged opportunities by name when in fact the so-called investment vehicles did not exist," Carter said. For example, Farah solicited funds on behalf of National Inspection and Repair after it had gone bankrupt, Carter said.
"Scott Farah and Financial Resources were fully aware of the fact that National Inspection and Repair was no longer a viable functioning business and in fact had hundreds of thousands of dollars of debts," he said.
Write to New Hampshire Union Leader Business Reporter Denis Paiste at dpaiste@unionleader.com