The Dallas Morning News
Points Section P
Sunday, May 18, 2014
BRIDGING DALLAS’ NORTH-SOUTH GAP | PROFITING OFF THE POOR
A cat burglar in the house Felon claims decaying homes without the owners’ knowledge and sells them to unsuspecting clients at inﬂated prices, writes Tod Robberson
Michael Hogue Staff Artist
Ambiguity leaves door open for opportunists Some Texas legislators want adverse-possession law tightened to clarify that squatting isn’t a legal route to homeownership By TOD ROBBERSON
Editorial Writer email@example.com
law that allows people to claim ownership of other people’s property seems almost like a license to steal. Have a few savvy real estate investors identified a loophole that allows them to legally take over vacant houses? Experts say adverse possession is a murky and little-understood area of real estate law that leaves too much to the imagination of opportunists. A lack of clarity has led to some wild misinterpretations, and several Texas legislators want the state’s adverse-possession law to declare without any ambiguity that adverse possession — squatting — is not a legal route to home ownership. “While I believe current state law outlaws squatters from claiming vacant property, I think it should be much clearer,” said state Sen. Jane Nelson, a Flower Mound Republican. A year ago, she introduced a bill, SB 947, to specify that squatting doesn’t equal possession. “It’s always been illegal to take another person’s property, and most frivolous adverse-possession claims have been resolved,” she said. But the ambiguity adds to the workload of local law enforcement and courts and creates big burdens for rightful owners trying to recover what’s theirs. Recent adverse-possession cases such as the ones involving squatters David Cooper in Arlington and Kenneth Robinson in Flower Mound suggest that people still see room for maneuvering and manipulation. If prosecutors fail to act when a squatter moves into a house, the only way to uproot an adverse possessor is through an expensive and time-consuming civil court
. . . . . . . .
process. Adversepossessionisanoldlawdesignedtohelp courtssettleboundarydisputesoroverlappingclaims, primarilyinvolvingruralfarmorranchland.Invery limitedcircumstances,itdoesallowindividualstotake deedtolandbelongingtosomeoneelse.Buturbanresidentialproperty?That’s adifferentissue,expertssay. DavidJ.Willis,aHoustonrealestatelawyerwhohas writtenextensivelyonadversepossession,saysheis unawareofasinglecaseinwhichTexascourtshaveupheldtheacquisitionofahousebyadversepossession. Thereareplentyofexampleswherecourtshavepunished peoplefortryingtodoit,hesaid. “Legitimateadverse-possessionclaimsarerare,”he said.Anyonewhothinksoflarge-scaleadversepossessionsasaprofit-makingrealestateinvestmentstrategy shouldthinkagain,headded.Thestate’s adverse-possessionstatute“doesnotcontemplateorcondonetheuse oftheadverse-possessionrulesasabusinessplanfor aggressiveinvestors.” Infact,hesays,“suchastrategyexpresslyinvolves breakingandentering,filingfalseinstruments,slanderof titleandfraud.Accordingly,districtattorneysinTexas havebegunprosecutingsuchoffenses.Noreputable attorneywillassistaclientintakingsuchactions.” Underthelaw,alladversepossessionsrequirethe claimanttocontinuouslyoccupyandusethepropertyin question.Thelawcontainsnoprovisionforpeoplewho fileapieceofpapertoclaimownership,thensellthe housetosomeoneelse.Thepersonclaimingthepossessionhastophysicallyoccupythepropertyanduseit. See OLD LAW Page 5P
SPECIAL REPORT Hundreds of Dallas County files document a bureaucratic and legal nightmare rooted in the adverse possession tactic used by Douglas T. “Chase” Fonteno and his associates to acquire other people’s property in southern Dallas. This Points special report is the first in a series of articles outlining the implications for authorities and taxpayers.
INSIDE THIS SECTION
■ How the system failed: Editorial calls for vigilance on real estate documents. 2P ■ A profile of Chase Fonteno: He markets himself as a “consummate speaker/lecturer” and places a trademark symbol by his name on some postings. 4P ■ Anatomy of an adverse possession: How 3239 Reynolds Ave. moved into the Fonteno organization’s possession. 6P ■ Southern Dallas portfolio: Locations and neighborhood demographics of Fonteno organization property. 6P
Dig even deeper at dallasnews.com/ profitingoffthepoor: ■ Neighborhood profiles: Learn more about the properties and neighborhoods where Fonteno holds property. ■ 3239 Reynolds Ave. paper trail: Review the documents that track the ownership changes. ■ How it works: Watch a video that explains how Fonteno’s operation works.
■ An analysis of the cost to taxpayers after Fonteno organization property sales, which were advertised as a way to fix downtrodden neighborhoods but wound up hurting many. ■ The “perfect storm” is brewing as Fonteno teams up with a notorious southern Dallas slumlord empire to market derelict houses. ■ A look at Fonteno’s Summer Breeze apartment plan, a $2 million upgrade to bring Miami “pizzazz” to South Dallas. The apartments fell apart, requiring taxpayer-funded demolition. The unpaid tax bill is now nearly $600,000.
ouglas T. “Chase” Fonteno has made a living acquiring other people’s houses, particularly in the lowest-income neighborhoods of southern Dallas. If he had paid the legal owners or obtained their consent, his story wouldn’t be remarkable. But according to official property records and Fonteno’s own statements, his empire was built in part by acquiring scores of houses without the owners’ knowledge and without paying them a dime. Fonteno, who was convicted of felony securities fraud in1996, produced a series of online videos in 2011 referring to himself as the “real estate catburglar.” He posted blog commentaries referring to these house acquisitions as “property you steal.” On his many websites, Fonteno presents himself as a well-meaning investor and philanthropist working to uplift neighborhoods and give poor, credit-starved people a chance to own a home. In reality, his acquisitions have left behind rotting properties, enormous unpaid tax bills and legal headaches. His clients tend to be uneducated, low-income individuals with no credit. Many don’t speak English and might easily be confused by the key words “adverse possession” that appear in many of his sales contracts. Adverse possession — commonly known as squatter’s rights — made dozens of his acquisitions possible, though not necessarily legally defensible. It’s based on a century-old law that applies almost exclusively to rural land, mining rights and boundary disputes. Experts can’t point to a single time it has been upheld in court as a means of taking urban houses. Throughout the last decade — and as recently as last month — Fonteno and his associates saw a way to profit by acquiring what they believed to be abandoned houses for which they paid nothing to the legal owners. Instead they filed claims of adverse possession, then sold these houses at inflated values to clients lured by promises of low mortgage payments and no credit checks, according to official property records and interviews with former Fonteno clients and business associates. Fonteno did not respond to repeated interview requests. Attorney Fredreck S. Hudgens, who has represented Fonteno in court, said there would be no comment because of pending litigation. Texas courts have held that adversepossession house seizures and sales See INVESTOR Page 4P
P1 05-18-2014 Set: 16:30:42 Sent by: firstname.lastname@example.org Opinion CYAN BLACK YELLOW MAGENTA
Sunday, May 18, 2014
The Dallas Morning News
BRIDGING DALLAS’ NORTH-SOUTH GAP | PROFITING OFF THE POOR
Smart, savvy and tough to track From his name to his address, Fonteno elusive — but no mistaking ego By TOD ROBBERSON
Editorial Writer email@example.com
D Ron Baselice/Staff Photographer
Steve Souter and his family successfully sued Chase Fonteno over his adverse-possession acquisition of the Oak Cliff home of Souter’s late father. But it took years, and lawyers’ fees drained the settlement money Fonteno paid out.
Investor calls methods legal Continued from Page 1P
constitute theft and fraud. For example, between 2002 and 2004, Richard Lawrence Nugent and Craig Davidson used adverse possession to seize and resell houses in the Houston area. A court sentenced Nugent to10 years in prison, then suspended the sentence, placed him on10 years’ probation and ordered him and Davidson to pay nearly $250,000 in restitution. In 2012, a Tarrant County jury sentenced David Cooper to three months in jail,10 years probation and a $10,000 fine for theft and burglary after he occupied a vacant Arlington house and claimed it under adverse possession. Earlier in 2012, Kenneth Robinson invoked adverse possession to seize a $340,000 bank-foreclosed house in Flower Mound. A judge rejected his claim and ordered him to leave. Unless Fonteno’s clients were wellschooled in the verbose, complicated legal terms in his organization’s sales contracts, it’s unlikely they knew they were agreeing to pay mortgages on houses that belonged to someone else. This Points special report is the first in a series unraveling the Fonteno organization’s massive paper trail and explaining the upheaval he continues to introduce into the lives of legal property owners as well as the clients he placed in these homes.
No links to legal owners Fonteno’s organization has dozens of holdings that property records indicate were acquired through conventional means. What distinguishes the unconventional holdings is the complete absence in public records of a document trail linking the legal owner with a knowledgeable deed transfer to Fonteno or his associates. The Dallas Morning News has documented more than 80 of these deals between 2000 and 2014. The typical document trail in a house’s history lists an unbroken chain of conveyances between legal owners and buyers. In Fonteno’s cases, that handshake chain is interrupted by the insertion of an adverse possession claim. In some cases, the legal owners have continued their normal trail of property transactions, unaware that a “catburglar” organization, as Fonteno describes his operation, has placed a claim on their property. In many cases, the opening for acquisition occurred when a homeowner died and the heirs failed to claim what was theirs. Wes Gilliland, a former Fonteno associate, said the standard procedure was to cruise southern Dallas streets looking for dilapidated properties that appeared to be vacant. He would note the addresses, search county records for telltale signs of abandonments, then file deed claims. Gilliland said he quit the work after deciding the On his websites, Fonteno, convicted of felony securities fraud in 1996, says he’s an investor and philanthropist whose goal is to give neighborhoods a boost and poor people a chance to own homes. He describes his approach as doing Dallas officials a favor by relieving the city of the burden posed by abandoned, blighted properties.
acquisition procedure was “a sham.” In blog postings, Fonteno has described his acquisition methods as legal and ethical and said his organization made every effort to locate the legal owners. An active partner in Fonteno’s enterprise was former Dallas City Attorney N. Alex Bickley, who died in 2008. Bickley’s name and signature began appearing all over the Fonteno organization’s property documents in 2004. And he was the attorney and agent listed on company filings in Colorado, where numerous Fonteno enterprises were registered. Bickley’s participation as a director and corporate counsel is another big curiosity, considering his17 years as city attorney, then his service as executive vice president of the powerful Dallas Citizens Council. According to online postings, Bickley and Fonteno built their business on the premise that abandoned property — or apparently abandoned property — was up for grabs. If you were a smart person, it was yours for the taking. But Texas law outlines strict procedures for adverse possession. The seizure has to be openly visible and hostile to the legal owner’s claim. The adverse possessor must live in the house uninterrupted for periods of10 years or more. In the case of Fonteno’s acquisitions, the adverse possessors — that is, Fonteno or his associates — would file their claims, then sell the houses without any indication in the public record of ever having occupied the properties for a day, much less10 years. If buyers defaulted on their mortgages, Fonteno’s organization would reassert its claim on the property. In nearly every case, according to public records, the neglected and vacant houses have come with enormous labor liens attached by the city. Typically, when property is abandoned, the city must perform weedcutting and other maintenance, charging $60 to $700 per visit. Then there are back taxes, which are assessed to properties claimed by Fonteno and associates. Rarely do they pay the taxes, according to Dallas County property records. Texas adverse possession law also requires claimants to pay taxes on the property. Dallas County records show that a tax bill of $1.7 million is owed on the property portfolio of Foteno and associates, not counting labor liens and other fines. Federal and state authorities also are demanding thousands of dollars in unpaid taxes.
SEC complaint, then ouster Fonteno moved from Houston to Dallas in the1990s. According to a Securities and Exchange Commission statement, Fonteno was released from prison in1997 and continued on probation for his securities fraud conviction. He then began doing real estate
work for the Remington-Hall Corp. The SEC said in a1998 complaint that he violated terms of his probation by issuing at least $1million in unregistered stock for the company. The SEC complaint said Fonteno claimed that Remington-Hall’s real estate holdings were worth $30 million. In fact, the SEC said, “Remington-Hall does not own most — if not all — of the properties it claims.” The SEC alleged that Fonteno used corporate money to “pay his speeding tickets, a girlfriend’s legal fees, and he also purchased an automobile for his maid.” Reacting to the SEC complaint in October1998, Remington-Hall’s board of directors ousted Fonteno. It was before his ouster that Fonteno appears to have adopted the “cat burglar” persona. A news release quoted Fonteno as stating about Remington-Hall, “We have been referred to as ‘Cat Burglars of Real Estate,’ and that’s a title we plan to keep.” Still on probation, about a decade ago, Fonteno and his associates launched their effort to acquire property through adverse possession. The Texas secretary of state lists the franchise registries on his numerous real estate companies as expired. His mortgage companies do not appear on registries of the Texas State Department of Savings and Mortgage Lending, as required. The houses his operation acquires are in Dallas’ most neglected minority neighborhoods. The Fonteno adverse possession model affects two sets of people: the legal owners of the property, who have to go to court to clear their deed records of the adverse possession claims, and the homebuyers, who might not understand the murky nature of adverse possession. Steve Souter of Farmers Branch was one of the few who had the means to sue after realizing that Fonteno had sold an Oak Cliff house Souter’s family inherited from his father, who died in1995. The heirs asked a constable to get the buyers — squatters — out, Souter said, but the constable balked when the occupants produced a Fonteno sales agreement. Souter and his siblings had to hire lawyers and spend years getting the house back after suing Fonteno, Gilliland and Hilton Head Properties. They won in court, but Souter said lawyers’ fees ate up the settlement money paid by Fonteno. Even as the court challenge was in progress, Souter said, the family constantly had to correct county records to register their ownership because an unknown person kept changing the registry back to another owner’s name. County documents indicate Hilton Head Finance, Novo Properties and BP Investments — all associated with Fonteno — were registering deed and loan documents regarding Souter’s property at that time. “There was tremendous anguish on our part because this was our father’s property,” Souter said. “Everything that we had to go through, the frustration of trying to get the squatters out and get this guy in court. ... It was very frustrating.” Gwendola Cole, 67, is a retired Dallas ISD teacher who now lives outside Washington, D.C. In 2008, she signed a $41,200 mortgage to purchase a South Dallas house at 3104 Pennsylvania Ave. from what she thought were the owners — Fonteno and his associates. She said she dealt directly with Fonteno on the sale. County records show that Saige Properties claimed the property by adverse possession at the time. Fonteno was Saige’s president. Cole estimates that she spent $33,000 on repairs to make the property livable. After renovation, city authorities told her See LIST Page 5P
ouglas T. “Chase” Fonteno appears to be a smart guy who puts a high priority on getting rich as quickly as possible. There’s also an ego to match his outsize dreams. Fonteno, 53, posts his profile all over the Internet. You’ll find him on Facebook, Twitter, LinkedIn, chasefonteno.com, About.me, free-press-release .com, to name a few sites. Such is the exclusivity of his name brand, at least in his own mind, that he places a trademark symbol on some postings: Chase Fonteno™. But like his confusing trail of real estate dealings, it’s hard to track down the real identity of the man behind the Fonteno persona. At various times since the1980s, he has called himself Douglas Terrell Fonteno, Chase D. Fonteno and Douglas Terrell Fonteno Proctor. In online biographies, Fonteno says he changed his last name in high school after his mother married his stepfather, James Walton Fonteno, a Harris County commissioner who is now deceased. The stepson says he adopted the nickname “Chase” in elementary school. He has signed numerous official documents, accompanied by notary seals, as Chase Fonteno or Chase D. Fonteno. The result is that his name appears in a variety of ways in official records, sometimes including his original last name of Proctor. Mix Fonteno’s aliases with the more than 25 companies and hundreds of real estate transactions bearing his name or signature, and you have a record-tracking nightmare. Process servers and law enforcers apparently have a difficult time not only with his name but also figuring out where he lives, which could help explain why he and his companies owe uncollected debts to federal, state and local tax collectors exceeding $1.6 million. Few people can seem to track him down. State tax liens list Fonteno’s address as 5535 Ranchero Lane in far southwestern Dallas. The house was owned by one of Fonteno’s companies, Saige Properties, until January, when the sheriff’s office seized it. The house, off a rural road, sits on a multi-acre lot. There are security cameras at the gated driveway. The overdue tax bill on the Ranchero property is $326,642.24. Fonteno’s current business address is a post office box. Trial lawyers and former clients say they’ve seen Fonteno sporadically around town, including at public land auctions. One lawyer said he served Fonteno court papers by staking out a property auction in front of a downtown Dallas courthouse. Anyone who reads his many postings cannot help but emerge with the impression
that his ego is enormous. Online, he markets himself as a “consummate speaker/lecturer.” In 2006, a glowing Business Wire news release, whose authorship is unclear, declared him one of Dallas’ “hottest CEO bachelors.” It said he ran two charities, the Phoenix Foundation and Hilton Head Charitable Land Trust, although the federal registry of 501(c)(3) charitable organizations contains no such foundations or trusts listing him as an officer. A biography posted on Wikibin.org says Fonteno formed his first real estate investment company in Houston at age17 and was a self-made millionaire by19. The assertion could not be confirmed. Former business associates, clients and litigants say he can be friendly, generous and helpful. They also consistently describe him as untrustworthy and litigious. “He is lawsuit-happy,” said Damon Nelson, a former associate who served on the board of directors of Fonteno’s parent company, Hilton Head Properties Inc. In addition to his felony conviction for securities fraud in 1996, which landed him a prison sentence and10 years’ probation, Fonteno has lost tens of thousands of dollars in civil court judgments. Plaintiffs are still trying to recover money from those judgments. Steve Souter, who successfully sued Fonteno four years ago after discovering that a family property in Oak Cliff was on the Fonteno organization’s adverse-possession list, expressed confusion about why Fonteno selected this particular business model. “The guy is really intelligent,” Souter said of Fonteno. “If he would use his intelligence and his smarts and his personality, the guy could be truly well off. But he’s a [felon] — he’s already been to prison once.” A Twitter posting under the name Chase D. Fonteno™ on Aug. 24, 2009, states: “I dare my vendors to file theft of services claim nothing sticks to me”. But in other Twitter postings in 2009, there are acknowledgments of his blemished record, such as “had to fire myself today i suck at running a company”. He also tweeted a five-point history of failure, including names of various Fonteno companies: “Hilton Head Prop, I have stolen another couple million, all employees walked out on me guess i go back 2 prison … RealEstate4Sale collasped company from my complete mismanagement and trying to steal more money while in prison … Remington Hall stole investor money and was sent to prison still on probation and paying the SEC … Paulson Advisors I ran the firm into the ground and was charged and fine by the authorities … Merrill Lynch — I was fired for being completely incompetent”. More recent photos and tweets posted online include details of a 33,000-mile trip he took in 2012 across19 countries, apparently including first-class airline seats. Former business associates and clients say Douglas T. “Chase” Fonteno can be friendly, generous and helpful. But they also describe him as untrustworthy and litigious.
P4 05-18-2014 Set: 11:00:50 Sent by: firstname.lastname@example.org Opinion CYAN BLACK YELLOW MAGENTA
The Dallas Morning News
Sunday, May 18, 2014
BRIDGING DALLAS’ NORTH-SOUTH GAP | PROFITING OFF THE POOR
List of companies, properties lengthy Continued from Page 4P
that roughly $9,000 in back taxes was due. But even if she paid them, city officials told her, the deed would remain in someone else’s name. The actual owner’s, that is.
‘That’s my house’ She recalled that a man came to the door one day and said, “That’s my house.” Cole told him she was buying it, and he left — still insisting it was his. Dallas property records indicate the legal owner was Garry Norris. Neither Cole’s name nor any of Fonteno’s company names appeared anywhere in official deed registries, even though the organization collected regular $430-amonth mortgage payments from her. Cole went to Fonteno’s offices to confront his staffers, but said they “just kind of ignored me. … They didn’t care. All they wanted was their $430 a month,” Cole said. Cole failed to get answers at Fonteno’s office, she said, “So I stopped paying,” reasoning that it would be foolish to keep making mortgage payments to someone other than the legal owner of the property. Fonteno evicted her and reimbursed nothing of her investment, she said. The house was to be her slice of “the American dream,” Cole said. But besides having lost her life’s savings, she’s left “feeling much more betrayed, that you can’t trust people.” Fonteno’s own auditor walked out on him when he studied the adversepossession business plan. Certified public accountant Jack Sprawls, identified in corporate documents as the independent auditor when Fonteno’s parent company registered in 2006 as a Colorado corporation, said he was troubled by Fonteno’s criminal background and the nature of these acquisitions. “How can you sell something you don’t own?” said Sprawls, who works for a large Dallas accounting firm. “I just couldn’t get happy with the concept.” The way Fonteno explains it online, he was doing local government a favor by relieving the city of the burden posed by these properties. “Cities and Counties only have so many people to deal with abandon, distressed, tax delinquent, code violation type properties that are a blight on neighborhoods. … There are1,000’s of them in almost every major city,” he wrote on his blog in July 2009. “More than the City/County can handle by foreclosure (taxes) or demolition (code violations). … Our work in blighted areas of a number of cities — helps convert blighted homes into owner occupied homes.” According to Texas law, though, it’s the local government’s job to initiate the process that leads to proper, legal transfer of abandoned properties. It is a painstakingly slow process that can take years, culminating in a judge’s order declaring the property abandoned and formally granting permission for the local government to seize it. Imagine the legal chaos that would ensue if, suddenly, the law allowed anyone to drive down the street and assert adverse possession of any number of houses, simply because the claimant deems them to be abandoned. Fonteno’s two parent companies in this enterprise are Hilton Head Properties LLC and Hilton Head Finance LLC. Then there’s a long list of companies formed by what he calls “investors” working in Fonteno’s offices, using his address and phone number to acquire additional properties. Fonteno outlines his acquisition philosophy on his company websites, personal blogs and Twitter postings. In a March 4, 2010, blog posting, he appeared to distance himself from the adverse possession acquisition strategy: “Hilton Head Properties and Hilton Head Finance have ‘never’ during its existence purchase ‘any’ single family homes or acquired any adverse possession homes. We ‘did’ rent space to over 40 investors [Fonteno’s office associates] that would acquire homes by many means, including tax sales, bankruptcy, foreclosure, judgment lien sales, auctions and more — including Texas Statute adverse possession. The ‘vast’ majority of100’s of mortgages we acquired were from properties the investor ‘purchased’ by these means.”
In a cursory search, The Dallas Morning News found five instances since the March 2010 posting where he and his associates recorded adverse possession deeds — three of which were signed by Fonteno. On April1of this year, Fonteno filed a new document transferring an adverse possession deed to two purchasers who only occupied the property in 2012. County property records now list the two purchasers, Antonia Perez Montanez and Antonio Perez Cuellar, as owners. As for his assertion about Hilton Head, Dallas County property tax records show that of15 properties currently listed as taxable entities under the control of Hilton Head Finance or Hilton Head Properties, three were acquired by adverse possession and seven more were acquired through similar processes without any deedtransfer record indicating the previous owner had consented to the transfer or even knew it was happening. County records list more than 40 single-family homes acquired by various Fonteno organization companies through adverse possession. Fonteno and his associates transferred ownership back and forth among Hilton Head Properties, Hilton Head Finance and more than a dozen other companies. There are times when Fonteno, acting on behalf of different companies, signed the transfer document both as buyer and seller. His and Bickley’s names appear throughout the document trail.
Absence of clear title More than 30 other property registries omit the words “adverse possession” but contain all the markings of an acquisition without the owner’s consent. Typically, those deeds contain warnings that the seller — Fonteno and/or associates — “does not have clear title” but expects title to clear within five years. Documents registered as recently as February and April of this year show that companies under the Fonteno umbrella continue to own, sell and resell houses they acquired by adverse possession years ago, making the trade of these properties an ongoing enterprise. Houses obtained by adverse possession are churned into an expanding group of conventionally acquired dilapidated houses in the Fonteno inventory. In numerous cases, county and city officials have ignored the Fonteno organization’s claims and continued to treat the previously registered title holder as the sole, legal owner. The county’s rejection of some of these acquisitions but recognition of others is inexplicable. But the sudden existence of a disputed title claim can lead to big headaches when the rightful owner tries to sell the property later. Fonteno’s business took off about10 years ago when he teamed up with Bickley, who brought intricate knowledge of vulnerable real estate opportunities, city government neglect and legal loopholes. Fonteno retells his own history in various online postings, often referring to himself in the third person as if narrating an epic biography. He didn’t make his millions with “ ‘get rich quick’ late night ads,” one Fonteno website explains. “He focuses on seriously distressed multi-family and single-family properties, predominately in low income areas, buying distressed homes and resell to ‘homeowners’ on owner financed loans with little down (fix it yourself) to convert the cycle of a ‘lifetime’ of slum rent that depresses many in low income areas, to ‘Pride of Ownership’, giving those individuals an opportunity to ‘own’ instead of rent — eventually paying off and never paying again.” In a 2008 blog posting, Fonteno offered candid insights: “What type of property ‘always’ goes up in value? What type of property — if you sell and have to foreclose — is ‘always’ in better condition when you get it back, than it was when you sold it? What type of property regularly confuses the pros as to its true value (literally leaving real estate professionals giving values assessments that often are over 300% from one another)? It is the property — you steal ! (legally and ethically of course ...)” Regarding the houses’ dilapidated condition, he exclaims: “Oh — and we don’t fix ANYTHING !! EVER !” Under Texas’ adverse possession law, there can be no attempt to hide the
Old law needs clariﬁcation, legislators say Continued from Page 1P
Ron Baselice/Staff Photographer
Gwendola Cole, a retired Dallas ISD teacher, bought this Pennsylvania Avenue home near Fair Park from Chase Fonteno in 2008. After she spent about $33,000 on repairs, the city told her $9,000 in back taxes was due. She also learned that someone else still owned the home.
nature of such property takeovers. The voluminous, complicated nature of Fonteno’s filings makes it very difficult to locate when an adverse possession has occurred. Sometimes he waits years before filing notice of his acquisitions. Among thousands of pages of documents attached to their transactions, Fonteno companies and associates have filed more than1,330 deeds, 777 deeds of trust, 58 corrections to deeds of trust, 358 appointments of substitute trust, 314 assignments of lien and 320 trustee deeds. They shuffle deeds, reshuffle, then shuffle again among multiple parties. Buried deep inside this pile of documents are the single sentences that, sometimes, constitute the adversepossession declaration. City authorities have filed at least 1,105 labor liens against properties now in the Fonteno organization’s hands. Such liens are designed to prevent the sale of property and transfer of deeds until the city’s claim is resolved. But Fonteno’s associates conduct sales and deed transfers anyway, apparently bypassing the normal title search process that would flag such liens. In online instructional videos showing how investors can make money reselling “distressed properties,” Fonteno calls himself “The Real Estate Catburglar” and overlays his video soundtrack with the copyrighted musical score from The Pink Panther. On blog items, a cartoon depicts a burglar poking his head through an open window. The mortgages attached to these adverse-possession sales are self-financed by one of the dozens of companies in the Fonteno organization, and purchasers pay interest rates of11percent or more. There is no credit check. The clients are people who lack credit, would not qualify for a bank loan and might not even have bank accounts. According to letters Fonteno has sent to clients, he accepts payments by money order only.
Slated for demolition The houses almost always are barely salvageable wrecks. Many of them had already been targeted for court-ordered demolition by the city when he took them over. Fonteno’s organization offered them for sale as is — at absurd prices. Properties that the Dallas Central Appraisal District values at $6,000 to $12,000 have been sold by Fonteno and his associates for up to $68,000. Why do buyers accept? Even at high interest, the average mortgage payments of around $550 a month are regarded by many buyers as a bargain. Some of his buyers are not legal U.S. residents, which limits their willingness to defend themselves in property or contract disputes, says Deborah Smith, a former Dallas County assistant district attorney who took over Fonteno’s case about two years ago. Smith said she wound up settling out of court because she “wasn’t invested in the case” after inheriting it from another assistant DA. Smith said she was unaware of the extent of the Fonteno organization’s adverse-possession holdings and would have been more aggressive had she known. Fonteno acknowledged in a 2010 blog entry that, in June 2009, the district attorney’s office notified him of a review related to a real estate fraud complaint. Rarely do his clients have the legal muscle or money to challenge Fonteno in court. Ten clients did sue his associates and companies in 2006, but funding dried up, the plaintiff’s attorney withdrew, and process servers couldn’t find five of the10 defendants, according
to court records. The case fizzled. Only two of those10 plaintiffs secured deeds to their properties. Several property deeds remain in legal limbo. Hilton Head Finance still is listed in Dallas County records as owner of two properties listed in that lawsuit.
No reimbursement In the few cases where the real owners have challenged in court, Fonteno’s buyers have had to move out, losing everything they invested. Fonteno states in his contracts that he will not reimburse for their fix-up expenses. Fonteno’s operation has occupied a number of office suites in and around downtown Dallas, including most recently at 400 N. St. Paul St. Fonteno and his associates apparently vacated the top-floor office suite about four years ago. But Fonteno continued using it as his address of record for some property transactions, such as one he filed with the county on Sept.10, 2013, when he identified himself as president of MLE Partners LLC, one of his many companies. A receptionist for the company now leasing his old office suite said Fonteno seemed to have moved out in a hurry in 2009 or 2010. He left all kinds of furniture and equipment behind, and yet his mail still comes to that address, she said. It’s not clear why he suddenly vacated. Most current Fonteno filings now list the official address as Post Office Box 130687 in Dallas. The change away from a physical address occurred shortly after a July 2009 report by Dallas’ KTVT-TV (Channel11) outlining a fraction of Fonteno’s activities. Days after that broadcast, Fonteno sent a letter to various buyers defending his tactics and advising them that their mortgage contracts clearly stated the adverse possession provisions. The return address on those letters was Fonteno’s St. Paul Street office suite. A month later, his written correspondence to clients no longer contained a physical return address, only the post office box. That’s about the same time he posted blog items distancing Hilton Head from adverse possession. Despite his ubiquitous presence on the Internet, Fonteno is a hard guy to find. He didn’t return calls to the phone number listed on the brightly colored poster boards tacked to decrepit, abandoned houses in southern Dallas. A reverse trace on the phone number lists it as belonging to Hilton Head Properties, 400 N. St. Paul St. It’s unclear where prosecutors stand regarding Fonteno. Steve Souter, the property owner who successfully sued Fonteno, said he was called for jury duty in early March. During juror interviews, he found himself face to face with Assistant District Attorney Stephanie Martin. “Mr. Souter, I think we’ve met before. Does the name Chase Fonteno mean anything to you?” he quoted Martin as saying. But the lack of prosecutorial followup, and the fact that his family had to pursue Fonteno at its own expense in civil court, leaves Souter somewhat cynical. “It took a long time to get justice served on this,” Souter said. Others might still be grappling with Fonteno, he added, “but he’s through cheating us.” Dallas Morning News editorial writer Tod Robberson may be contacted at email@example.com.
The law basically requires the claimant to trespass, fully aware that the property belongs to someone else. The trespass must be sustained — and unchallenged by the legal owner — for at least10 years, but usually much longer. In the case of a house, the claimant has to go inside and live there. That means entering through a doorway or window, perhaps breaking a lock, or prying plywood off sealed openings. In such cases, simple trespass becomes breaking and entering. That puts an adverse-possession action into a completely different legal category, which is why house occupiers can go to jail, experts say. “You can’t cloak yourself in that law,” Tarrant County Clerk Mary Louise Garcia told the Fort Worth Star-Telegram last year. “It is not a defense to criminal prosecution.” Wes Gilliland, a former associate of Douglas T. “Chase” Fonteno, said most of the empty houses he claimed between 2004 and 2006 were in such a dilapidated state, there were no locks to break. Sometimes there weren’t even doors. “The most difficult ones were when the city had boarded them up. They did a pretty good job” of securing them against intruders, Gilliland said. Had the doors been locked on his adverse-possession houses, he says, he probably would not have attempted an acquisition. “The presence of a lock means somebody is trying to keep you out,” he said. But when it’s not locked, “it’s a way of saying, ‘I don’t care.’ ” Deborah Smith, a former Dallas County assistant district attorney who handled a county legal case against Fonteno, said the complicated nature of adverse-possession law led her to believe that Fonteno and his associates had simply found a legitimate loophole. She remembered reviewing one case two years ago with an investigator and concluding, “That’s pretty savvy of him” because of the way Fonteno structured his contracts. Besides, in the few cases where legal owners reclaimed their property, “people were coming back to find their homes in much better condition than what they had left, and the property values had actually increased,” Smith said. In retrospect, she said she negotiated a settlement, though a better resolution would have been to argue the case in a full court trial. Then there’s the question of what constitutes abandonment. Texas law makes no specific provision for individuals or companies to privately assess whether a residence is abandoned and, therefore, subject to adverse possession. There is no law that outlines, for example, conditions such as boarded-up windows, overgrown lawns or unpaid taxes as criteria for private seizure. Plenty of southern Dallas houses fit those criteria even though the owners still live in them. Texas receivership law is what establishes the procedure for assessing a house’s abandonment and proper disposition. The assessment always involves local government authorities or court-authorized nonprofit groups, said professor Heather Way, who focuses on blight issues as director of the Entrepreneurship and Community Development Clinic at the University of Texas School of Law. Dallas has an additional tool, a state land bank law, which requires taxing authorities to present an overwhelming body of evidence to a judge before obtaining authorization to take over a house, demolish it or offer it for sale at a sheriff’s auction. But it’s not up to private individuals or companies to exercise that law, Way said. Texas law specifies a series of notification procedures required to protect the rights of the legal owners. So, just because a house is empty doesn’t mean it’s fair game for anyone on the street to claim it by adverse possession, experts say. Whether it’s profit motive or a true desire to improve neighborhoods, individuals don’t have the powers of government to take other people’s houses.
P5 05-18-2014 Set: 12:29:07 Sent by: firstname.lastname@example.org Opinion CYAN BLACK YELLOW MAGENTA
Sunday, May 18, 2014
The Dallas Morning News
BRIDGING DALLAS’ NORTH-SOUTH GAP | PROFITING OFF THE POOR
Properties in play This map shows the locations of nearly 100 properties claimed by Douglas T. “Chase” Fonteno and his associates through various methods, including adverse possession and quitclaim deeds. Not all of these properties are recognized by the Dallas Central Appraisal District as belonging to companies associated with Fonteno. Dallas North Tollway
2 miles 75 289
3239 Reynolds Dallas boundary
DOWNTOWN DALLAS 352
180 175 LOOP
Title claims by category Adverse possession
Map background: 2013 estimated median value of owner-occupied housing units by census tract
Break in title chain
$50,000 or less
Does not have full clear title Does not have title policy
$50,001 to $100,000
$100,001 to $250,000
Selling without title
$250,001 to $500,000
Unrecognized in DCAD registry
More than $500,000
SOURCES: Dallas Central Appraisal District; Federal Financial Institutions Examination Council; U.S. Census; ESRI; Dallas Morning News research
Tod Robberson/Staff Writer; Tom Setzer/Staff Artist
Anatomy of an adverse possession Taking over without ever buying a home from its legal owner
ow, exactly, does adverse possession work? You can’t just bust through the front door and declare yourself the owner. Official county land records only recognize the registered deed holder as the owner. Sometimes the paper trail ends with the Dallas Central Appraisal District, or DCAD, listing you as the deed holder.
Here’s an example of how Douglas T. “Chase” Fonteno’s organization selected someone else’s residential property and maneuvered the
ownership records to eventually reflect his company’s name as the owner. The process is complicated and multilayered. By TOD ROBBERSON
Editorial Writer email@example.com
The property at 3239 Reynolds Ave., northeast of Fair Park, illustrates how it can be done. In the truncated timeline below, documents are listed in the order they were filed in official records offices or posted online:
1. Proud, new homeowners: On Jan. 9, 1980, Pauline S. Stephens and her husband, Thomas J. Stephens, purchase the 760-square-foot, two-bedroom, one-bathroom house at 3239 Reynolds from Ernest A. Stark for $4,500. 2. Time passes, a property declines: Public records indicate Mr. Stephens died in August 1996; no death certificate is on file for Mrs. Stephens, but a public notice listed a Pauline Stephens as having died in 1998. Beginning in 2001, the city starts to file labor liens as it sends crews to clear weeds on the property. The liens are designed to block any sale until city maintenance costs are reimbursed. On Oct. 21, 2003, Fonteno and Nathan Volk meet at the Magnolia Hotel in Houston and initiate formation of Hilton Head Properties. A mission of the company, Fonteno says, is to acquire property deeds using “adverse possession,” or squatter’s rights.
TAX BILL $4,22 5
3. The legal owner: For all of 2004, the Dallas Central Appraisal District lists Pauline S. Stephens as the owner of 3239 Reynolds. Her unpaid tax bill is now $4,225.97.
On Jan. 2, 2004, Fonteno associate Volk registers Hilton Head Properties Inc. as a Colorado corporation with principal offices in Dallas. On June 7, 2004, Fonteno associate Wes Gilliland registers Lightchaser Properties Inc. as a Colorado company, with its Dallas address the same as Hilton Head’s. Volk is listed as the incorporator.
QUIT 4. A new move: On June 23, CLAI 2004, Gilliland, with no prior M DEED connection to the house at 3239 Reynolds, files a quitclaim deed, declaring that he conveys “any and all interest” he has in the property to Lightchaser Inc. for $10. In reality, Gilliland has no interest whatsoever, according to deed records.
5. A buyer appears: On Oct. 9, 2004, Gilliland, as president of Lightchaser Properties, signs a contract for deed with Flor and Francisco Banuelos for their purchase of 3239 Reynolds for $42,500. Buried in the contract is a statement that the seller does not have clear title — meaning Gilliland is selling property he doesn’t own.
quires adverse possession to be openly declared and obvious. The complicated list of documents filed March 13 includes an almost indecipherable, overlapping group of sellers and mortgage issuers — all sharing Fonteno’s business address. Among those listed: Fonteno, Bickley, Volk, Gilliland, Silvia Olivo, Paul Parker, Lightchaser Properties, Novo Properties, Hilton Head Properties, Hilton Head Finance, Trier Properties.
6. The legal owner: Throughout 2005, DCAD still identifies Pauline S. Stephens as the owner of 3239 Reynolds.
9. Homeowners no more: On April 2, 2007, Fonteno associate Paul Parker files a docuOWNERS ment with the county declaring the Banueloses in default and announcing an auction to be held the following day. The result of the auction was not recorded.
LEGA OWN L ER
On March 13, 2005, Volk registers HHead Lightchaser LP in Colorado as a company, listing the same Dallas address as Hilton Head and other companies under the Fonteno umbrella. On July 25, 2005, former Dallas City Attorney N. Alex Bickley files articles of amendment for Hilton Head Properties Inc., listing himself, Nathan Volk and Douglas “Chase” Fonteno among members of the board of directors. The document identifies Fonteno as the “sole shareholder” of the corporation. The document is signed only by Fonteno.
7. New homeowners: In its 2007 listing, DCAD, for the first time, names Flor and Francisco Banuelos owners of 3239 Reynolds, even though no document appears in county records in which Pauline Stephens or her heirs ever ceded ownership. 8. Documents dump on county records office: On March 13, 2007, six documents are filed — some of them signed months earlier. They include one detailing the Banueloses’ mortgage agreement with Alex Bickley, another canceling the agreement, and another in which the Banueloses are advised for the first time that the title to the property “is held by adverse possession.” The rapid succession of documents indicates that Fonteno and Bickley were trying to fix a potential legal problem. Because their previous contracts did not specify the terms of adverse possession, the Banueloses could have had legal grounds to challenge this sale. Texas law re-
10. Bulk sale: Now comes an inexplicable hiccup in the paper trail — a retroactive document recording the bulk sale of 35 properties, including 3239 Reynolds. The document is filed on Oct. 9, 2008, but is declared retroactive to Aug. 30, 2005. It lists “Chase” D. Fonteno, president of Saige Properties Inc., as the seller. It also lists “Chase” D. Fonteno, president of Hilton Head Finance, LLC, as the buyer. By making this document retroactive, Fonteno effectively establishes himself as the legally responsible decision maker for 3239 Reynolds, among 34 other listed properties. 11. New buyers: On Aug. 10, 2009, Gonzalo TierrablanNOT ca and Maria Leticia Martinez appear in a document as the new purchasers of 3239 Reynolds. Alex Bickley is listed as the mortgage originator. The sale price is $37,050, payable to GP Acquisitions. The document says the note and deed of trust were transferred to BP Investments Inc. Registries and documents list BP Investments and GP Acquisitions as sharing Fonteno’s business address. Apparently, according to the above document, Tierrablanca and Martinez defaulted on their mortgage even before their purchase could be registered. At this point, DCAD still lists the Banueloses as the owners of 3239 Reynolds, even though they are long gone. 12. Pending demolition: On Feb. 8, 2010, the Dallas city attorney’s office calls a public
hearing to declare 3239 Reynolds a derelict property and formally request court permission to demolish the house. For the first time, the city identifies Hilton Head Finance as the owner. 13. House condemned: On March 18, 2010, a Dallas municipal court issues a formal demolition order for 3239 Reynolds. On Feb. 16, 2011, the city demolishes the house. 14. More weeds, more liens: From Dec. 15, 2010, to Sept. 21, 2012, the city issues 11 additional labor liens to Hilton Head Finance for failure to maintain the now-vacant property, ranging from $179.72 to $355.75 each. 15. More homeowner confusion: On Oct. 30, 2012, a sheriff’s auction is recorded, list? ing the sale of 3805 De Maggio Ave. to Jose S. Peñaloza. The De Maggio property is one of the 35 listed in the bulk sale mentioned in item No. 10 above. But in an attachment to this sheriff’s sale, all 35 properties, including 3239 Reynolds, are now recorded as having been sold to Peñaloza. Today, whenever a county records document search is conducted on 3239 Reynolds, Peñaloza’s name is attached to the deed. Fonteno’s signature appears on this document. 16. Responsible owner? From May 16, 2013, to Jan. 24, 2014, the city of Dallas issues four additional labor liens for failure to maintain the property at 3239 Reynolds, listing Hilton Head Finance as the owner. Values of the liens range from $193.82 to $211.94. To date, none of the labor liens has been listed as cleared. 17. Trail’s end: On Jan. 1, 2014, the county tax assessor updates taxes (excluding liens and other fines) owed by the owner of 3239 Reynolds. The total is $35,245.21. The owner of record is Hilton Head Finance, LLC, whose listed president is Douglas T. “Chase” Fonteno. The assessed value of the property he now owns: $10,000. There’s no indication during this decadelong process that any of the Stephens heirs asserted a legal right to this property. Even though the house was demolished, the fact remains that Fonteno’s company wound up as the recognized owner of 3239 Reynolds without ever having purchased it from the legal owner.
P6 05-18-2014 Set: 14:18:48 Sent by: firstname.lastname@example.org Opinion CYAN BLACK YELLOW MAGENTA
The Dallas Morning News
Monday, June 30, 2014
BRIDGING DALLAS’ NORTH-SOUTH GAP | | PROFITING OFF THE POOR
A Perfect Storm
Longtime landlord of junk-house empire joins forces with Fonteno to sell properties in distressed areas at inﬂated prices, writes Tod Robberson
he name Topletz Investments resonates around southern Dallas as the gold standard for slumlord exploitation of the poor. The Topletz family is infamous for purchasing hundreds of bottomquality, dilapidated houses, slapping a coat of paint on the exterior, then renting them out to low-income residents willing to accept a rickety roof over their heads. Patriarchs Harold and Jack Topletz spent years expanding their housing empire by snapping up hundreds of properties from owners desperate to sell or from foreclosure sales such as those that occur every first Tuesday of the month outside the Dallas County courthouse. Only the Topletzes win in this scenario: Tenants end up overpaying for rentals, the surrounding neighborhood’s value falls as a result of the squalid conditions and City Hall can’t keep up with the numerous code violations on Topletz-owned property. It’s a perfect storm of safety and quality-of-life problems inflicted on southern Dallas. Since Jack Topletz died last year, Harold’s son, Dennis Topletz, has pursued a new approach: Instead of buying cheap properties and renting them, why not quickly flip them for a high price, with self-financed mortgages charging 11.5 percent interest? The idea emerged from his close collaboration with another southern Dallas slumlord entrepreneur, Douglas T. “Chase” Fonteno, who built his own real estate empire, in part, by acquiring houses through adverse possession — squatter’s rights — without the real owners’ knowledge or permission. Fonteno had years of experience selling these crummy houses at exaggerated prices. He self-financed and charged buyers 11 percent interest rates.
Joining forces Now Fonteno and the Topletz family have joined forces to begin investing in some adverse-possession properties while co-financing high-dollar, high-interest mortgages for nearly worthless houses. Fonteno’s operation was the subject of a May 18 Points special report. Since its publication, he has curtailed public access to his blogs and taken down his Facebook page. Many of the same personalities in Fonteno’s offices at the height of his adverse-possession operation, which involved multiple overlapping companies, also have worked alongside him in the Topletz offices at 7509 Inwood Road. The interchangeable nature of the Topletz and Fonteno businesses sometimes gets confusing to the point that the names of personnel and companies mix regularly in property-transaction documents, making it appear as though no delineation exists. A good example was a June 3 foreclosure sale at the county courthouse conducted by Carver Dan Peavy, a former Dallas ISD trustee who apologized and resigned in 1995 from the school board after using racial slurs and profanity in a private phone conversation. An investigation ensued over allegations of his role in a DISD insurance-fraud scandal, but Peavy successfully argued in court that the phone conversation on which the allegations were based was recorded illegally. Years later, Peavy served as director of acquisitions for Fonteno’s Hilton Head Properties. Outside the courthouse, Peavy sat in a chair quietly offering to take bids on seven southern Dallas properties whose owners had defaulted on their high-interest loans. “I work for the Topletzes,” Peavy told me as he called for bids on one foreclosed property. But five of the seven properties he offered for sale were on behalf of Fonteno companies. One of the five was a house at 4106 Marshall St., which Fonteno’s organization acquired by adverse possession in 2006 and has sold multiple times at inflated prices and high interest rates. The sole bidder on the Marshall property was a woman who identified herself only as Grace and said she worked for the Topletzes but also
Turning a blind eye to kids’ peril Christine Wicker says U.S.
should aid young migrants, not put them back in danger
Douglas T. “Chase” Fonteno sold this property at 4614 Stokes St., in the low-income neighborhood of Joppa, for $49,000 on behalf of Topletz Investments last year. The home’s appraised value was only $7,800.
‘A cat burglar in the house’ READ the special report on Douglas T. “Chase” Fonteno, who has made a living acquiring other people’s houses, particularly in the lowest-income neighborhoods of southern Dallas. If he had paid the legal owners or obtained their consent, his story wouldn’t be remarkable. But according to official property records and Fonteno’s own statements, his empire was built in part by acquiring scores of houses without the owners’ knowledge and without paying them a dime. dallasnews.com/profitingoffthepoor
was bidding on behalf of MLE Partners. Fonteno has listed himself in documents as MLE’s president, while other MLE documents indicate participation by the Topletzes. Grace’s winning bid for the Marshall house was $10,000. After the foreclosure sale, I asked Peavy if he was aware that he had just sold an adverse-possession property. He seemed surprised. “I don’t have anything to do with those things at all,” he insisted. But the fact is that the foreclosure-sale document named both Dennis and Harold Topletz as trustees of the mortgage for 4106 Marshall. With this foreclosure sale, Peavy had placed Harold and Dennis Topletz’s names on an adverse-possession house transaction and estab-
lished their financial interest in the property’s sale. Real estate law experts say they can’t cite a single instance in which Texas courts have upheld the taking of urban residential property by adverse possession. Later that day, Peavy filed a notarized document claiming that the winning bid was $13,000 — not $10,000 — and that the bidder was GP Acquisitions LLC, another Fonteno company. Grace, the sole bidder, never claimed at the sale to represent GP. The notarized document put some distance between the Topletzes and the adverse-possession property their employee had just acquired. But I’ve obtained other adversepossession mortgage documents that indicate Topletz involvement.
Licensing question Aside from adverse possession, another big legal question has emerged from the Topletz-Fonteno partnership: Is anyone in either operation licensed to negotiate and issue their mortgages? It doesn’t appear so. Yet state and federal laws require anyone who originates more than five property mortgage loans per year to register and be licensed. The federal Secure and Fair Enforcement for Mortgage Licensing Act of 2008, known as the SAFE Act, defines a loan originator as someone
“who takes a residential mortgage loan application and offers or negotiates terms of a residential mortgage loan for compensation or gain.” The Texas Department of Savings & Mortgage Lending says the issuing of special warranty deeds or deeds of trust constitutes loan origination. According to Dallas property records, Fonteno signed and filed more than a dozen special warranty deeds on behalf of the Topletzes in 2013. Peavy has signed and filed more than 20 special warranty deeds this year. Another colleague whose name appears in both Fonteno and Topletz organization documents, Cecilia Flores, filed nearly two dozen in 2013. Since the start of 2013, Topletz Investments has issued more than100 special warranty deeds and deeds of trust. My review of state online registries shows no mortgage-origination licenses issued to any of the Fonteno or Topletz organizations or the individuals mentioned above. The law does offer some exemptions, but none appears to apply here. The state mortgage lending department is charged with protecting consumers from unfair or abusive lending practices. It’s the closest thing the state has to a consumerprotection bureau for homebuyers. Department officials told me they are reviewing documents in the Fonteno-Topletz cases and might refer the matter to other state or federal agencies.
Gaps of thousands
Carver Dan Peavy, a former Dallas ISD trustee, conducted a foreclosure sale June 3 at the county courthouse. He says he works for the Topletz family, but five of the seven southern Dallas properties he offered were on behalf of Fonteno companies. The sole bidder on an adverse-possession house at 4106 Marshall St. was a woman (right) who identified herself as Grace and placed bids on behalf of companies linked to Fonteno and the Topletzes.
Why would that consumer-protection agency’s oversight be useful in a case like this? Consider that the average value of Topletz mortgage filings since January 2013 is around $55,400. The average Dallas Central Appraisal District assessed value for those properties is around $14,500, making the average difference around $40,900. Look at an individual house in that inventory. Fonteno arranged the sale and mortgage of 4614 Stokes St. in the very low-income neighborhood of Joppa in March 2013, selling it to Jennifer Wells for $49,000 on behalf of Topletz Investments. The house has never been valued by DCAD for more than $12,800. When Wells bought it and agreed to an11.5 percent interest rate, the appraised value was only $7,800. Or consider Debra Brown, who signed an $83,000 mortgage with Peavy even though DCAD appraises her house at 3837 Colonial Ave. at only $11,830. That provides just a taste of what this perfect storm of real estate practices by the Fonteno and Topletz organizations is doing to exploit poor people around southern Dallas. It’s time for local, state and federal authorities to step up and enforce the law. Dallas Morning News editorial writer Tod Robberson may be contacted at trobberson@dallas news.com.
xactly 75 years and one month ago the St. Louis, a German trans-Atlantic liner carrying 938 Jewish refugees, was turned away from the United States, forced to return to Europe. U.S. law didn’t allow them sanctuary. Today we are preparing to send 45,000 children back to Central American countries controlled by drug cartels that routinely torture, rape and kill children who refuse to work for them. So routinely, so often are children menaced that their families sent them away, alone, across thousands of miles on just the slimmest of hopes that they might be safe. U.S. law doesn’t allow them sanctuary. The St. Louis is famous now as a failure of compassion that haunts American history. It is so easy to imagine the despair of those passengers, forced to return to countries that would soon be overrun by the Nazis. It is difficult to imagine an America that would be so cruel and insensible to the terror of others. President Franklin Roosevelt is still held accountable for his failure to respond. And now we have President Barack Obama promising to send the children back. We have an America demanding that he do so, and in fact, blaming his administration for not securing the borders more tightly so that those desperate Central American families would have had no hope at all that their children might find sanctuary. But, in fact, the border is secured. The children are in custody. They will be turned back. There are differences, of course, between these children and Jews on the St. Louis. These children didn’t arrive on an ocean liner. They walked through some of the most hostile, hot, barren, dangerous country in the world. No one knows how many died. Their parents weren’t with them. They were sent by poor families so terrified for their safety that they paid many thousands of dollars and entrusted their children to criminals hoping they might arrive in America and be safe. There’s another difference too. America did not fund the Nazis. America does fund the drug trade that empowers the killers these children are fleeing. If Americans didn’t buy drugs, the trade would dry up. I keep wondering if those families were thinking about the great kindness that Americans are known for. Despite all that America may have done wrong, this is still a country that the world looks to for compassion and rescue. I wonder if those parents thought American hearts would be touched so deeply that there would be a great outcry when their children’s stories were heard. We have heard their stories now. Stories of children who are publicly stripped naked and gang raped by drug syndicates. Stories of children maimed. Stories of children murdered. Hearing how callous the world was to the suffering of Europe’s Jews, we are baffled. We wonder how that slaughter could have been allowed to happen. We wonder why countries closed their borders. I don’t wonder anymore. I’ve listened to the politicians, read the editorials and heard the voices of American citizens demanding that terrified children be sent back into harm’s way. Our hearts are not touched by these children. We want the law enforced. This is our country. Ours. And we don’t have to share it. Not now. Not 75 years ago. We haven’t changed at all. Why? It’s simple, really. A matter of us and them. Yes, these are children whom we’ll send back to be raped, maimed and killed. But they aren’t our children. Our children are precious. These children. They simply aren’t. Not to us. Christine Wicker is an author and former Dallas Morning News reporter. She may be contacted at christinewicker@ earthlink.net.
A11 06-30-2014 Set: 11:37:33 Sent by: cci News
BLACK YELLOW MAGENTA CYAN
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Faith and war: For so many of us in the comfort of the West, it is hard to understand the generational conflicts in the Middle East, between Jew and Muslim or Sunni and Shiite. The cycle of provocation and vengeance seems to have no end. This endless entanglement is wrapped on all sides in justifications of faith. How can faith help break this cycle? How can people on each side use their belief in a higher power, and in their sacred scripture, to see the humanity in someone different? See how our Texas Faith panelists answer these questions. Rudolph Bush, editorial board member
Thursday, August 7, 2014
Fairer shake: The Legislature supposedly will tackle the workers comp issue in the next session. There’s an interim review under way to deal with issues such as the possible misclassification of workers, hearing procedures and voluntary participation. Here’s what progress would look like: making workers compensation coverage mandatory, especially for hazardous industries such as construction and chemical, and stopping tricks to misclassify employees as subcontractors, which allows employers to avoid paying taxes and benefits. Jim Mitchell, editorial board member
BRIDGING DALLAS’ NORTH-SOUTH GAP | PROFITING OFF THE POOR
A costly tax dodge Fonteno leaves taxpayers on hook for $2 million, says Tod Robberson
eaders are rightfully outraged by our special reports exposing how Douglas T. “Chase” Fonteno has expanded his slumlord empire. His companies acquired dilapidated houses in southern Dallas without owners’ knowledge and then resold them to unsuspecting individuals at inflated prices and high interest rates. So now consider this: When it comes time to pay the taxes on his holdings, Fonteno is nowhere to be found. Dallas County taxing authorities have assessed bills just shy of $1.5 million on the residential properties in Fonteno’s inventory. Federal and state authorities seek an additional $234,427 in unpaid taxes. Plus the city has issued maintenance and demolition liens totaling more than $300,000 on derelict properties owned by Fonteno’s companies. That means taxpayers are on the hook for more than $2 million from this rogue operation. That’s your money we’re talking about. Much of the tax bill comes from the former Southland Terrace Apartments on Hatcher Street, which Fonteno companies acquired around 2005. They pledged big renovations but did nothing. Tax bills and code violations mounted. Eventually, the city won a court order to demolish the apartments. Today, the properties are listed mainly under Fonteno’s Summer Breeze Partners LP. The unpaid tax bill and late fees total $504,000. It’s clear from the outdated addresses where authorities are delivering the bills — offices and a house Fonteno long ago vacated — that they don’t know where to find him. But he’s been something of a fixture at the offices of Topletz Investments on Inwood Road and at the county courthouse, where for years he has filed deedregistry changes and other documents related to the sale of adverse possession houses. One of the few agencies to reach Fonteno is the Texas Department of Savings & Mortgage Lending. After we began publishing our reports, the department followed up and confirmed that Fonteno didn’t have a license to originate the high-interest, high-dollar mortgages on his companies’ inventory of broken-down southern Dallas houses. The department has issued a cease-anddesist order against Fonteno, along with associates Dennis Topletz and Carver Dan Peavy. They have until Friday to appeal and disprove the allegations. They each also have been assessed $4,500 penalties. Given Fonteno’s history of nonpayment in court and tax-debt cases, the state shouldn’t count on seeing his money anytime soon. It’s bad enough that Fonteno doesn’t put a high priority on making things right with Dallas taxpayers. But for the people who sign mortgage loans with Fonteno, the fact that he hasn’t kept
century-old resentments, alliances, political trends
orld War I started one century ago. Wait! Don’t stop reading. For most Americans, the war is like algebra or frog anatomy — something you have to study briefly in school but then never have to think about again. Unlike World War II, with its unambiguous villains, epic battles and clear victory, World War I is a hot mess. Countries and forgotten empires declared war on each other in no small part because a bunch of aristocrats in funny clothes said they had to. Everything about World War I — from the seemingly ridiculous fighting techniques (Who hasn’t watched a movie with trench warfare and thought, “Man, that’s a dumb way to die.”) to the clothes and music — seems anciently irrelevant. But the truth is that almost no modern event can hold a candle to it. U.S. diplomat George Kennan observed that when studying the maladies of the 20th century, “all the lines of inquiry lead back to World War I.” A century from now, people might say the same thing of the past two centuries.
No need to fear Ebola in America My bout with a similar disease proves the U.S. is prepared, writes Michelle Barnes
Victor Gomez and Irma Rodriguez found the taxes weren’t paid on a house they bought from Douglas T. “Chase” Fonteno, after he had pledged to do so. They sued and won. READ Tod Robberson’s previous reports in this series. dallasnews.com/opinion
up with the tax payments has even more serious consequences. Mortgage contracts for the purchase of his companies’ dilapidated houses stipulate that the properties come with substantial back taxes — sometimes tens of thousands of dollars. Fonteno promises in the contracts he signs that his companies will cover the back taxes up to the date of purchase. But long after his buyers move into their houses, they are shocked when they eventually learn the taxes haven’t been paid. The purchasers are left holding the bill when the tax collector comes knocking. Victor Gomez and Irma Rodriguez are two such victims. In 2008, they purchased a house from Fonteno at 2738 Foreman, apparently unfamiliar with the term “adverse possession” that appeared in their contract. It meant Fonteno was selling them a house he didn’t own or have permission to sell. They took out a $27,700 mortgage with Fonteno’s Deveron Properties. Fonteno, signing on behalf of Deveron, pledged in writing to pay the property’s $12,685.13 back-tax bill. But — surprise — Deveron didn’t pay the back taxes. (Not to mention that it was a mortgage contract Fonteno was never licensed to originate in the first place.) Fonteno’s organization abruptly foreclosed,
with Peavy issuing a foreclosure-sale notice that alleged Gomez and Rodriguez hadn’t paid their tax or loan installments on the adverse possession property. According to a 2011 lawsuit, it was Fonteno’s company that had failed to pay the tax bill. Fonteno and associates evicted Gomez and Rodriguez and deeded the property to his GP Acquisitions LLC, then to Deveron Properties Inc. Today, the unpaid tax bill is $21,369 for a decaying property valued at only $23,460. In their 2011 lawsuit, Gomez and Rodriguez alleged fraud, breach of contract and deceptive trade practices. A district judge awarded them more than $80,000 in damages. In a court settlement, they gained possession of the house where Fonteno had long resided, at 5535 Ranchero, in far southwestern Dallas. But even that was a bittersweet victory: He left them with an unpaid tax debt on the Ranchero house of $335,000. Such is the tangled web Fonteno has woven with some of his unlicensed and potentially unlawful real estate practices. His conduct suggests he will not voluntarily pay what his companies owe. So at least for now, you the taxpayer will pay while he plays his real estate games. Dallas Morning News editorial writer Tod Robberson may be contacted at trobberson@ dallasnews.com.
WWI: The war that keeps giving to the world Jonah Goldberg reviews
Let’s start with the obvious. The staggering loss of military lives: 650,000 Italians, 325,000 Turks, nearly1million from the British Empire, over1million from AustroHungarian lands,1.4 million from France,1.7 million Russians,1.8 million Germans and116,516 Americans — not to mention 8.9 million civilian casualties worldwide. None of that counts the 50 million fatalities resulting from the flu pandemic largely unleashed by the war. Without World War I, you don’t get the second — a poignant irony given that the former was sold as the “war to end all wars.” The terms imposed on Germany, described as a “Carthaginian peace” by John Maynard Keynes, made another war virtually inevitable. Much as Adolf Hitler found his life’s mission while fighting in World War I, Benito Mussolini’s fascism was a direct adaptation of what he called “the socialism of the trenches.” Without the first war, the Bolsheviks almost surely would never have come to power in Russia. That led to the Soviet Union’s mass murder, Eastern Europe’s enslavement, the Cold War and, of course, Vladimir Putin’s career. The Middle East’s travails can be traced in no small part to the Ottoman Empire’s dissolution at the end
of WWI. Dividing their spoils, the British and French drew most of the contours of the Arab world to their benefit. According to a surely false legend, the line between Jordan and Saudi Arabia takes a crooked turn because someone bumped Winston Churchill’s elbow while he was drawing it. (Churchill himself blamed his errant pen on a liquid lunch.) What’s not disputed is that the resulting maps have fed countless conflicts and resentments ever since. In the West, the war opened a Pandora’s box, unleashing innumerable cultural and intellectual demons that we have decided to make peace with rather than defeat. And then there’s America. Some good was hastened by the war, though it’s hard to believe women’s suffrage wasn’t inevitable. But it’s also hard to ignore the harm, at least from a libertarian perspective. “I believe it is no exaggeration,” wrote sociologist Robert Nisbet, “to say that the West’s first real experience with totalitarianism — political absolutism extended into every possible area of culture and society, education, religion, industry, the arts, local community and family included, with a kind of terror always waiting in the wings — came with the American war state under Woodrow Wilson.”
Wilson introduced domestic spying, censorship, violent political intimidation of opponents and economic statism into the American DNA. Pro-Wilson intellectuals celebrated the “social possibilities of war,” in the words of John Dewey. By that they meant the ability to force Americans to, as Frederick Lewis Allen put it, “lay by our good-natured individualism and march in step.” The enduring notion that experts could plan the economy from Washington was largely born in Wilson’s “war socialism.” David Adesnik, my colleague at the American Enterprise Institute, has an essay in The Weekly Standard arguing that America had no choice but to join World War I because Germany had resolved to fight us. Maybe so, but America joined that stupid and calamitous war very late in the game and by doing so abetted the Carthaginian peace. The correctness of that choice is an academic question. The consequences of it remain very much alive. Jonah Goldberg is a fellow at the American Enterprise Institute and editorat-large of National Review Online. He may be contacted email@example.com.
left Uganda on New Year’s Eve 2007 after a two-week adventure vacation, passing through London, then Iowa, on my way home to Colorado. I had no idea I was traveling the world while infected with a deadly virus. The symptoms began en route — a headache, a rash, nausea — but for five days I lived my normal life, enjoying my family, going to Starbucks, shaking people’s hands. All the while, I was carrying this horrible disease at the height of its contagious period. I’m the only person known so far to have imported an Ebola-like disease to the United States uncontrolled. I had contracted the Marburg virus from a bat cave in Queen Elizabeth National Park, one of Uganda’s most popular tourist attractions. In the medical world, Marburg is known as Ebola’s “kissing cousin.” While different molecularly, the viruses infect victims in the same way and cause the same symptoms. Both result in fatality rates of 60 to 90 percent and run hot through a community. There is no vaccine or cure for either. During my first days back in the United States, my body was slowly shutting down from multisystem organ failure. I visited my doctor and was sent home with painkillers and nausea prescriptions. As my liver, kidney, lungs, gallbladder and pancreas slowed, I went to restaurants and meetings and visited my parents. On my third visit to the doctor, I collapsed and was rushed to the hospital. More than 220 health care professionals treated me over12 days. But they couldn’t diagnose my problem. Luckily, my body was able to fight off the illness that was shutting down all of my organs. After I started to recover, I was sent home with no clarity on what had brought me so close to death. Twelve months later, I read about a Dutch woman who died of Marburg after visiting the same bat cave I had been to in Uganda. The World Health Organization investigated and determined that the bats carried the virus. My infectious-disease doctor retested me, and jackpot! I had battled and survived Marburg — even though I hadn’t touched or been bitten by a bat. It is still a mystery how I and the Dutch woman contracted Marburg. I was panicked to think that I might have unwittingly transmitted the Marburg virus to another person during the weeks I was contagious. But the Centers for Disease Control and Prevention said no secondary cases were identified in either my situation or the Dutch woman’s. Thanks to safety protocols in our hospitals, the fact that I cover my mouth and wash my hands a lot, and by the grace of God, the potential outbreak stopped with me. But the fact remains that I contracted Marburg in Africa and brought it home. I wasn’t in quarantine, and I interacted with hundreds of other people while contagious. Epidemiologists believe Marburg and Ebola are transmitted between humans by bodily fluids, not through airborne particles, and my experience supports that. In Africa, Ebola is moving from person to person and has already killed more than 900 people with hundreds more in quarantine. A lack of understanding of how to prevent the spread of this most deadly Ebola outbreak is feeding fears that the disease will continue to spread for months . But the story in the United States is different. While Americans aren’t exempt from contracting Marburg or Ebola, our odds of survival are better than people living in rural villages. We have access to more sophisticated health infrastructure, better information about the spread of disease and practices that more effectively contain infections. If the Ebola virus is exported to the United States, as the Marburg virus was by me, I don’t fear an outbreak here. Our health care system is prepared. I’m proof of that.
Michelle Barnes works as an interim executive in the nonprofit sector focusing on turnarounds and complex transitions. She lives outside of Golden, Colo.
A13 08-07-2014 Set: 14:29:53 Sent by: firstname.lastname@example.org News
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Bungled Trinity projects? Council member Scott Griggs says the department overseeing the city’s most transformative public works effort, the Trinity Project office, has now dropped the ball on two more major projects. What he lays out is concerning.
SMU football at a crossroads: It might be comforting to argue that SMU could be the next TCU or Baylor. The truth is starker and darker. Simply, it’s not going to happen. Maybe June Jones’ departure is an opportunity to consider real life in today’s college football landscape.
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Not bound by the law? City Hall wants junk-house dealer brought to justice, Tod Robberson writes
udging by her weekend appearance in Iowa, it looks as if Hillary Clinton is indeed running for president. Now she has to answer one simple question: Why? “It is true, I am thinking about it,” she said Sunday at the final Harkin Steak Fry, an annual cholesterol-boosting fundraiser that retiring Democratic Sen. Tom Harkin has hosted for 37 years. Given the context, this was pretty close to an announcement of the Clinton 2016 campaign. She was in Iowa, whose first-inthe-nation caucuses kick off the presidential primary season. She was accompanied by husband Bill, who did his best to play the supporting role of a candidate’s spouse, although second fiddle is an instrument he has not quite mastered. She greeted the crowd by announcing, “Hello Iowa, I’m baaaaaack,” stretching the word for emphasis. The last time she barnstormed
Leslie Morgan Steiner said
Among the adverse possession properties of Douglas T. “Chase” Fonteno is this house at 4106 Marshall. Charles Johnson (left) and Clifton Mims say they have received eviction threats. COMING TOMORROW: Where the district attorney’s office and other agencies stand on the Fonteno companies’ actions. READ Tod Robberson’s previous reports in this series. dallasnews.com/opinion
ness. It might make us feel good, but it would not solve the problem.” Seems to me that it would be worth the trouble to serve Fonteno notice that authorities are watching. Additionally, the city and other taxing authorities need to collect every dime of the more than $2 million in unpaid taxes, fees and penalties owed by Fonteno companies. The real authority rests in the hands of District Attorney Watkins to address legal issues raised by the unsubstantiated deed claims Fonteno has filed in county records, his threats of foreclosure when house occupants don’t pay, and his strongarm eviction tactics. The ball is in Watkins’ court, Rawlings suggests. “I trust that the district attorney’s office will take appropriate measures to penalize him.” There’s lots of material worth the district attorney’s review, and the voluminous documents on file at the county records office tell only part of
the story of how Fonteno has disregarded the law. The victims’ stories might complete the legal picture, but so far there’s no indication federal or county investigators have sought them out. Claims made verbally by the seller — Fonteno or his associates — could be radically different from what he puts on paper. The stories that victims can tell, and the patterns of how these house sales were marketed to them, could provide actionable material. On paper, an adverse possession deed constitutes a declaration that a person is occupying a piece of property — squatting — with an intention to make a claim once the statute of limitations runs out for the legal owner to oust the occupant. Nothing in state law authorizes the sale and resale of houses under occupation during an adverse possession. Senior Assistant City Attorney Art Hudman says there might not be anything illegal in the way Fonteno and associates have filed their claims. Likewise, if they persuade a client to sign a deed, chock full of unintelligible legalese that effectively states the entire deed and sale aren’t worth the paper they’re written on, that also isn’t necessarily illegal. “He’s basically getting somebody
to pay them [Fonteno’s companies] good money for nothing,” Hudman said. “A document that says, ‘This is a piece of garbage, and you know it’s a piece of garbage. Pay me some money that it might turn into oil someday’ — that’s a bona fide transaction.” Failing county and federal efforts to get to the bottom of these activities, city officials are cheering the work of private attorneys such as Fernando Martinez, who has won judgments against Fonteno’s companies and continues to pursue him in court with a growing list of clients. In the absence of prosecutorial action, “frankly, the light shined on this sort of conduct by the media, the legal aid community and others is probably one of the most effective ways to put these sorts of scammers out of business,” Hudman said. These operators don’t just stop on their own. As Hudman puts it: “Scammers have been trying to sell deeds to the Brooklyn Bridge to the uninformed for generations.” Dallas Morning News editorial writer Tod Robberson may be contacted at email@example.com.
It’s time to hear Clinton’s vision for nation She needs to tell us how she will lead as president, says Eugene Robinson
Victims of abuse need compassion she’d never stay with a man who hit her, until she did
First of two parts here’s a palpable sense of frustration at City Hall over the ability of Douglas T. “Chase” Fonteno, the self-described “real estate cat burglar,” to continue disregarding laws and victimizing poor people in southern Dallas. Other offices with prosecutorial powers seem uninspired by stories of how Fonteno obtained houses under the guise of adverse possession, put deeds in his companies’ names without the owners’ knowledge or permission, then sold and resold these houses to unsuspecting buyers. Prosecutors have shown little interest in interviewing victims or educating themselves about the real estate laws that Fonteno regularly flouts. Fonteno continues to test the legal boundaries because prosecutors and others in positions of authority aren’t challenging him. Their inaction enables him to go further, and Dallas City Hall would like to see him stopped. After exposing Fonteno’s activities in a series of reports this year, I contacted the offices of various officials, including Mayor Mike Rawlings, U.S. Attorney Sarah Saldaña, District Attorney Craig Watkins and County Clerk John Warren. Off-the-record expressions of outrage are overwhelming. On the record, City Hall seems to be the only place where authorities are pushing for action. “Mr. Fonteno’s actions are truly reprehensible,” says Rawlings. “I have charged the city attorney’s office with exploring all available options that will enable us to change the environment that has allowed Mr. Fonteno and others like him to take advantage of poor residents in southern Dallas.” City Attorney Warren Ernst and three of his deputies invited me earlier this month to review the Fonteno case at their offices. Ernst’s staff clearly gets what’s at stake and why it’s necessary to raise some legal roadblocks. But city legal authorities say their punitive options are extremely limited. The city is empowered to administer fines and assess fees for noncompliance with local laws. It’s misdemeanor, slap-on-the-wrist stuff. “The problem is, we’re limited by our jurisdiction to fines only,” Ernst says. Fonteno could absorb any such penalties “as a cost of doing busi-
through Iowa, it did not go well. The 2008 caucuses were supposed to ratify her status as the Democratic front-runner and show her challengers the futility of their puny efforts. Instead, she finished third behind Barack Obama and John Edwards. The Clinton machine lost the air of inevitability that had been its greatest asset — and turned out to lack a compelling message that could compete with Obama’s promise of hope and change. Now Clinton begins another campaign — perhaps — in which she is seen as the inevitable winner. She has said she will make a firm decision “probably after the first of the year.” But if she has reached the point of dropping broad hints, she needs to begin telling the nation how and why she proposes to lead. The election of the first woman as president would be a great milestone, but a glance at the headlines — economic and social dislocation at home, terrorism and war abroad — suggests that voters will probably not be in the mood for symbolic gestures. To win the nomination, let alone the general election, Clinton will have to lay out her vision of
the way forward. Her memoir of the years she spent as secretary of state, Hard Choices, offers little guidance. My view is that Clinton did an excellent job as America’s chief diplomat, but if she has an overarching philosophy of foreign relations, for some reason she left it out of the book. We know that President Barack Obama believes in multilateralism and the sparing use of U.S. military force. We know that some critics believe we should be more interventionist and others believe we should be more isolationist. Hard Choices doesn’t really tell us which way Clinton leans, though her record suggests a slight nod toward the hawkish side. Clinton’s message on domestic affairs is also unclear. At the Iowa event, she sounded what is sure to be a major theme for both Democrats and Republicans in the coming campaign: the need to ease the plight of the beleaguered middle class. If this indicates she is beginning to formulate a populist appeal, she will find that territory already staked out by Sen. Elizabeth War-
ren, D-Mass. Warren’s blistering critique of structural economic inequality is popular with liberal Democrats, some of whom see Clinton as too cozy with Wall Street. When Warren is asked about her intentions, her standard formulation is “I am not running for president,” using the present tense. It seems likely, in any event, that someone will challenge Clinton from the left. After Clinton’s brief speech, her husband tried his best not to steal the show. Bill Clinton tossed out lines that can only be called Clinton- esque — “We have got to pull this country together to push this country forward” — and implored Democrats and Republicans to find ways to work together. Centrist pragmatism as a campaign theme? In American politics today, the middle is a dangerous place to be. Eugene Robinson’s email address is eugene robinson@ washpost.com.
ust before I fell in love with a man who abused me, I spouted off to my New York City roommate that I’d never be stupid enough to stay with a man who hit me. Like most people who are naive about the complexities of relationship violence, my dismissal of the dangers of abusive love cost me dearly. When I see footage of Ray Rice knocking his then-fiancée, Janay Palmer, unconscious in an Atlantic City elevator — and her subsequent defense of Rice — I recognize how hard it can be to leave a violent relationship. Here are the times I wish I’d left my abusive husband, an Ivy League graduate and Wall Street trader I met in New York when I was 22 and a recent Harvard graduate: ■ Three months into our relationship, the night he choked me during sex and I wrote it off as weird but somehow erotic (for him; not for me). ■ The day we moved in together and he wouldn’t talk to me because a male friend from college called to congratulate me on the milestone. ■ The Saturday he said I looked better without any makeup and told me not to wear it anymore. ■ The night I was getting dressed to go out to dinner and he told me I was a slut because my skirt was too short. ■ The morning five days before our wedding when he first physically attacked me, because, he said with his hands around my neck, “you remind me of my mother.” ■ During our honeymoon, when he punched me so hard my head hit the window in our car. ■ The day he said I couldn’t spend Christmas with my family. ■ The first time he threatened to kill our dog. ■ The first time he pushed me down a flight of stairs. ■ The first time he threatened to pull the trigger of the loaded gun he held at my head. Here are the reasons I didn’t leave my abusive husband soon enough: ■ No one in my life had ever made me feel so safe, loved, beautiful and validated as he did during the early months of our relationship. ■ I confused pity with love, feeling sorry for him because he had been beaten and starved by his stepfather as a child. ■ I thought I was the only woman who could help him face his demons. ■ In between the terrible times, he still made me laugh. ■ I loved him. No one but Janay and Ray Rice knows whether their relationship has been violent beyond that elevator ride, but I do know that isolated incidents of relationship violence are rare. They’re typically part of a pattern — a pattern that’s the same no matter the education, ethnicity, income level, race or gender of the victim or abuser. In my experience, this is how it goes: Fairy-tale romance. Isolation from friends, family, neighbors and co-workers. Threat of violence. Actual violence. Convincing apology. Repeat. One day, Janay Rice may have her own lists of the times she wishes she’d left; the reasons she stayed; and the friends, relatives and strangers who understood the complex psychology of relationship violence. Instead of condemning her for loving a troubled man, let’s educate ourselves about the twisted psychology of abusive love, so that we can be there for her if she decides to leave. Firing Roger Goodell and blaming the NFL won’t do Janay Rice, or any other domestic violence victims, any good. Rather, we should hold abusers — and no one else — responsible for the damage they inflict.
Leslie Morgan Steiner is the author of the memoir “Crazy Love” and a TED Talk about the many reasons abuse victims stay. She can be reached at firstname.lastname@example.org.
A11 09-16-2014 Set: 18:02:14 Sent by: email@example.com News
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War, what is it good for? Anti-war protesters, if you really think this is the place to make your stand, then tell us: If the Islamic State isn’t confronted militarily, how does this end?
Medical marijuana: Rep. Tan Parker, R-Flower Mound, surprised me with his support for putting a tightly written medical marijuana amendment on the ballot, and I told him so. He chuckled and said, “I throw people off once in a while.”
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Congress needs to weigh in
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Do an up-or-down vote on use of force against Islamic State, Michael Smerconish says Severiano Martinez
“I have charged the city attorney’s office with exploring all available options that will enable us to change the environment that has allowed Mr. Fonteno and others like him to take advantage of residents of southern Dallas. I trust that the district attorney’s office will take appropriate measures to penalize him.” — Mayor Mike Rawlings
These victims deserve answers Tod Robberson urges county and feds to investigate real estate ‘cat burglar’ Second of two parts
ecent news stories underscore the impressive ability of prosecutorial agencies to take action when their leaders deem it necessary. Attorney General Greg Abbott’s office, for example, ordered a raid on the offices of a voterregistration group in Houston, then seized and destroyed documents even though the group had broken no laws. The Dallas County district attorney’s office devoted staff time and more than $50,000 to settle a traffic accident involving District Attorney Craig Watkins. But when Douglas T. “Chase” Fonteno repeatedly disregards laws and victimizes people, like those pictured above, where are the authorities with the power to bring justice? Fonteno, the self-described “real estate cat burglar,” has filed adverse possession claims to acquire and sell scores of southern Dallas residential properties without the real owners’ knowledge or consent. Sure, it’s possible Fonteno has broken no laws. But the activities deserve legal scrutiny, according to experts in real estate law. This is not the time to give him the benefit of the doubt. City officials are voicing frustration over the apparent lack of action, and Mayor Mike Rawlings wants to see Watkins get involved. Fonteno has sold adverse possession properties to low-income buyers, some of whom don’t even speak English, much less understand the complicated legalese of his property deeds. Bad stuff is happening. People’s lives are being ruined. Victims have tried for years to come forward to tell their stories and maybe motivate the district
READ editorials and Tod Robberson’s previous reports in this series. dallasnews.com/opinion
attorney’s office to take action. But spokeswoman Debbie Denmon says this isn’t the DA’s problem. “The cases have been referred to the feds … Housing of Urban Development … they are handling the Fonteno cases,” Denmon wrote in an email. “We have not received a call from feds telling us to handle a specific matter — so it is still in their hands.” I have copies of complaints sent to Abbott’s office as far back as 2005. So far, Abbott’s office has expressed zero interest in following up on Fonteno. U.S. Attorney Sarah Saldaña also is aware of Fonteno’s case. Her office doesn’t discuss or even acknowledge investigations, but various local officials say they believe her office is working on it. The only punitive action so far has been by the Texas Department of Savings & Mortgage Lending, which issued a cease-and-desist order against Fonteno and two others for originating mortgage loans without a license. Each was assessed a $4,500 penalty. Although the financial penalty may be minor, it seems to have gotten their attention. Since it was issued July 9, registered mortgage origination activity by the three has ceased. Still, the county registry contains scores of adverse-possession deed documents in the name of Fonteno’s companies for properties for which they have never held title. The mystery is how those filings in numerous cases turned into recognition of ownership in the Dallas Central Appraisal District’s official registry. After all, the rightful owners never authorized a title transfer.
County Clerk John F. Warren says that shouldn’t be happening and warns that it’s a crime to file a fraudulent document. Normally, the records office serves as a passive recipient of documents. But he told me in April that the standing practice across the state is to not accept adversepossession deed documents “because of the implication of mass fraud.” He said he planned to refer examples of Fonteno’s adverse-possession documents to Watkins’ office and instruct his own staff to be on alert for future filings. “Anytime I see this, we will immediately refer it to the district attorney’s office,” he said. Warren hasn’t responded to my queries since then, and his staffers continue to post suspect Fonteno organization documents in the online registry. The documents’ presence helps Fonteno and associates establish “proof” of ownership for foreclosure and eviction actions. That’s how the county effectively puts its stamp of authority on these operations and how the county clerk’s office becomes an enabler of activities that stretch legal boundaries. While Watkins fails to take action and points to the feds, Fonteno and his associates continue victimizing the poor. So Watkins also becomes an enabler. As long as inaction prevails, as long as the buckpassing continues, the poor and powerless will keep paying the price. Those who have the ability to stop this — yet don’t — enable Fonteno to stay in business. Dallas Morning News editorial writer Tod Robberson may be contacted at trobberson@ dallasnews.com.
Children face threat at hand of caregivers Adrian Peterson case brings to light sad truth about abusive parental discipline, says Christopher Suprun
our children will die. They will die today, as they did yesterday and as they will tomorrow. The children are not dying of cancer or heart disease; they are dying at the hands of loved ones who are abusing them. I am talking about the Adrian Peterson abuse situation. Peterson tells us he is just raising his children like his parents raised him. Wrong. He isn’t raising children at all. He tells us he is just disciplining his kids. He isn’t. Study after study tells us he is slowing the cognitive development of his own children. That’s right. Peterson is increasing the likelihood of anxiety, depression and antisocial behavior. Another worrying statistic: Children who get “whooped” — Peterson’s description — are nine times more likely to become involved in criminal activity. Peterson said he hit his child with a tree branch “10 to15” times. However, he said, he doesn’t “ever count how many pops I give my kids.” Look at his son’s leg. It has at least that many marks where the switch caught his thigh. Use your senses and let’s consider this 4-year-old — a 4-year-old who was beaten by a man who is 6-feet-2 and 220 pounds. The police report notes defensive wounds to
difficulties.Forgetaboutlong-termpsychological issues.Thischildisafraidofhisownfather. Yes,IamsillyenoughtothinktheNational A federal report released in April, using data from FootballLeagueshouldcleanupitsact.They 2012, says: shouldsuspendPetersonforayearandmakehim ■ 1,640 children died from abuse and neglect completeaparentingprogram.Yes,Iamsilly nationwide that year, 2.2 for every 100,000 children enoughtothinkthattheNFLshouldkeepthisman in America. That’s 4.5 children killed per day. fromhisprofession. ■ 50 percent of deaths reported as unintentional are later reclassified as due to maltreatment. Ofcourse,fornow,thingsappearheadedinthe Of all children who died from neglect and abuse: oppositedirectionforPeterson.TheMinnesota ■ 77 percent are age 3 or younger. VikingsreinstatedhimonMonday,adayafterthey ■ 80 percent suffer at the hands of their parents. lost30-7totheNewEnglandPatriotswithouttheir starback. “Iunderstandthatthisisaverydifficultthingto thehands.Iwonderhowablethischildwasto handle,”saidRickSpielman,thegeneralmanager. defendhimselfagainstaguywhorushesthrough “Whetherit’sanabusivesituationornot,orwheth300-poundgiants. erhewenttoofardisciplining,wefeelverystrongly Iwon’tattackthegame,butweneedtorealize thatthatisthecourt’sdecisiontomake.” thatiftheplayerscannotcontroltheirimpulsesat Rightnow,theleagueislost.It’slostlikeachild home,theyneedtofindanewlineofwork.Ihateto afraidofhisorherownparent,andthatshould interruptthisyoungman’sabilitytocarryaball scareeveryfanandeveryfamily. downthefieldjusttosavethelifeofhischild,but Maybeweshouldstopplayinggamesuntilwe let’sconsiderhischildforasecond. learnhowtodealwithabuse. Takealookatthepicturesofhischild.Ifyoucan Fourchildrenwilldietoday,justasfourdied stomachit,takealook.Takeasecondandletthe yesterday.Let’smakeitthelastday. imagessinkin.Now,whatwouldyoudoifyousent yourchildtoafriend’shouseandhecamebackwith thoseinjuries?Woulditbeacceptableforyour ChristopherSuprunisalocal neighborto“whoop”yourchildlikethatifhegot paramedicandspokesmanfor outofline?Petersondidthattohisownson. NeverForgetFoundation,a Listentohisson.Hedidn’twanttotalktothe 501(c)(3)thatcoachesstudents policebecausehewas“afraidofDaddyPeterson.” on achievement and success. His email address is Forgetthestatisticsforamomentaboutlearning firstname.lastname@example.org.
Death at a parent’s hand
hile President Barack Obama made a convincing case for military intervention against the Islamic State last week, there’s something else that should occur before the United States again pursues a strategy of war: It’s time for Congress to have an up-or-down vote on authorizing the use of force. Sadly, that doesn’t appear likely. And not because Congress is too busy on other matters of similar import. Last week, the House voted to amend the Wild and Scenic Rivers Act. And to rename the Bainbridge Island Japanese American Memorial as the Bainbridge Island Japanese American Exclusion Memorial. Then there was HR 4651, which designated the U.S. Postal Service facility in Baytown as the “Specialist Keith Erin Grace Jr. Memorial Post Office.” It’s been the same in the Senate. Senators voted on the nomination of Henry J. Aaron of the District of Columbia to be a member of the Social Security Advisory Board. And they approved the Multinational Species Conservation Funds Semipostal Stamp Reauthorization Act of 2013. And so on it goes. Meanwhile, there have been plenty of sound bites about the Islamic State, but not a lot of congressional action. This week, Congress may vote on one piece of the president’s plan, authorizing the U.S. military to train Syrian rebels to fight the Islamic State. But that’s not a declaration of war, which the gravity of the situation requires. U.S. Rep. Jack Kingston, R-Ga., summed up the situation: “A lot of people would like to stay on the sideline and say, ‘Just bomb the place and tell us about it later.’ It’s an election year. A lot of Democrats don’t know how it would play in their party, and Republicans don’t want to change anything. We like the path we’re on now. We can denounce it if it goes bad, and praise it if it goes well and ask what took him so long.” I suspect some legislators are looking at then-Sen. Hillary Clinton’s vote to authorize the use of force in Iraq in 2002 as the type of albatross that comes from such votes. Others don’t want to stand for anything the president supports. Whether congressional approval is legally necessary is unclear. When hostilities arise, politicians and pundits interpret the Constitution, U.S. laws and protocol differently. The Constitution recognizes the role of the president as commander in chief, but the War Powers Resolution says Congress needs to approve the use of U.S. troops for more than two months. There was, of course, a 2001 authorization for the use of force after the 9/11 attacks, but that was against alQaeda, not the Islamic State. However, the president might look to the language of the 2002 resolution regarding Iraq. “Legally, he will get away with it. The political question is the one that is more important,” explained Stephen G. Rademaker, an assistant secretary of state in the George W. Bush administration who is now a principal at the Podesta Group. Rademaker agrees with me that it is a mistake to pursue this plan without making sure Congress is on board. “Things don’t always go well with these operations,” Rademaker said. “It is much better to have Congress on board for the takeoff because then you know they have to be there with you for the landing. Members of Congress like to complain that they were not consulted. ... But on really hard questions like this, there are many times when members of Congress don’t want to take a stand.” I think the American people are entitled to know exactly where our elected representatives stand — not from a media appearance but from a vote. Going to war is a momentous decision. We elected them to make these tough decisions. So, members of Congress, our post offices and scenic rivers can wait. It’s time for you to face the most serious of responsibilities you were elected to do. Philadelphia Inquirer columnist Michael Smerconish can be reached at smerconish.com.
A21 09-17-2014 Set: 16:36:05 Sent by: email@example.com News
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The Dallas Morning News
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On the payroll: If you’re among the growing legions who have come to understand the real cost of a payday loan, here’s more reason to be ticked — the industry’s influence in Austin. That includes more than $400,000 in contributions to the gubernatorial front-runner since ’09.
Too soon: Don’t get me wrong. I love dark humor. But decking your mansion out in hazmat materials and quarantine paraphernalia is in the worst possible taste. Ebola isn’t funny. More than 4,000 people are dead in West Africa from it.
Jim Mitchell, editorial board member
Tod Robberson, editorial board member
Prime corner sits in limbo
Football means business
Playoff conﬁrms D-FW as home of champions, says
BRIDGING DALLAS’ NORTH-SOUTH GAP | PROFITING OFF THE POOR
Thorny owner still blocks needed redevelopment, Tod Robberson says
Dallas City Council member Carolyn Davis cheered the bulldozing of the rundown apartments in 2010. But Douglas T. “Chase” Fonteno, known for adverse-possession of slum houses, keeps the land tied up.
flying image, resiSummer Breeze site It’s as if keeping a slum intact was better than dents at Summer The main concentration of Summer Breeze properties admitting defeat. Breeze were coping occupies a strategic location “Was it [bankruptwith water and gas cy] filed to stop them service that had been in South Dallas, where S.M. cut off because man- Wright Freeway is slated to be from tearing down this converted into a boulevard. property? Absolutely,” agement didn’t pay he said at the time. the bills. Elderly Summer Imagine the gall of resident Flossie r e Breeze ch t Fonteno, unabashed Crane told a Dallas a H properties exploiter of the poor Morning News reand proud claimant of porter in 2006 that C ro zi other people’s houses, her water supply er to assert victimhood consisted of a bucket when code enforcefilled from a neighDALLAS ment officers and city bor’s hose. lawyers zeroed in on Years passed, 175 his drug-infested, during which a new 175 N eyesore apartments. owner briefly Yes, it’s nuts. stepped in. But Fon1/4 mile 310 Finally, in Decemteno foreclosed and ber 2010, the city regained ownership. D/FW cleared the first of All the while, city DALLAS several legal hurdles citations piled up. In FORT WORTH Detail and began demol2010, the city finally ishing the apartments. sought and obtained Kyle Alcott/Staff Artist As tractors moved in, a demolition order. City Council member Fonteno’s company filed for bankruptcy, which blocked the Carolyn Davis expressed dreams that the empty acreage could become home demolition. to quality retail, like maybe a Gap store. “Every time we were close, the More recently, others say Wal-Mart majority owner would file for bankhas expressed interest in the site, esperuptcy protection,” then-assistant city cially now that S.M. Wright is slated to attorney Melissa Miles complained at be replaced with a retail-friendly bouthe time. But Fonteno behaved as if “he” were levard. But despite all the liens and lawthe injured party. “The city has gone so far beyond what is allowed, it’s nuts,” he suits, Summer Breeze still holds title to the land, now empty and covered with complained of the demolition effort. rig .W M S.
ouglas T. “Chase” Fonteno is the headache that won’t go away for Dallas authorities. Beyond his empire of adverse-possession slum houses, he also has effectively blocked city efforts to redevelop several acres of real estate at a commercially strategic intersection south of downtown. Nine years ago, Fonteno and his associates acquired a dilapidated 228-unit apartment complex in South Dallas known as Summer Breeze. In his big-talking, wheeler-dealer way, Fonteno promised on his company’s website to renovate the complex and give it Miami pizazz — palm trees, water features, landscaping and updated amenities. He dubbed the new venture Tuscany Palms and listed himself as the company’s president and sole director. But as Fonteno has done in other real estate ventures, he shuffled deeds and mortgage trusts back and forth among various entities, all of which led back to the mailing address of Fonteno’s parent company, Hilton Head Properties. These paper trails typically lead to confusion. At one point in 2010, Fonteno, as president of Summer Breeze, foreclosed on Fonteno, as president of Tuscany Palms. Who knows why? He hasn’t returned repeated phone calls seeking comment over the past 18 months. The foreclosure happened as he was preparing a bankruptcy filing to forestall city demolition orders on the derelict complex. This saga began in 2005, when Summer Breeze and Hilton Head promised a $2 million investment “with the goal of creating a unique environment in affordable housing” on Hatcher Street at S.M. Wright Freeway. Instead, the companies perpetuated — and allowed to further deteriorate — a sprawling, partially boardedup magnet for drug users and vagrants. Fonteno launched this venture almost simultaneously with Hilton Head’s debut on the Dallas real estate scene. Touting entrepreneurial success, he moved into spacious offices with panoramic views on the 38th floor of a downtown office building. A press release proclaimed Fonteno one of Dallas’ “hottest CEO bachelors.” It made no mention that he was a felon convicted of securities fraud. Much of what he portrayed as entrepreneurial success involved acquiring scores of houses by filing legally dubious adverse-possession deed claims. He would offer other people’s houses for sale, apparently hoping that neither the legal owners nor the purchasers would detect that he had no authorization to do so. While Fonteno cultivated a high-
READ previous installments in this series. dallasnews.com/opinion
weeds. Since 2011, the city has filed more than1,300 labor liens against Summer Breeze for post-demolition maintenance costs of up to $360 per lien. In order for local taxing entities to recover more than $500,000 owed by Summer Breeze, authorities obtained a court order to sidestep Fonteno’s title and auction the property. In August, most of Summer Breeze’s 27 lots went on the auction block at the county courthouse, valued at $12,000 to $37,000 each. In a basement room packed with bidders, no one raised a hand at the auctioneer’s call. He halved the asking price. Again, no bidders. The auctioneer finally offered the lots for the rock-bottom price of only $3,900 each. Silence. No one, apparently, wants to touch properties so heavily encumbered by Fonteno’s debts. No Wal-Mart. No Gap. That’s how the dreams for a strategic southern Dallas neighborhood’s recovery are trampled by the man who calls himself “the real estate cat burglar.” Editorial writer Tod Robberson may be contacted at trobberson@ dallasnews.com.
Security at borders requires smarter spending Doubling down on enforcement can backﬁre, but better roads, surveillance are needed, says Ruben Navarette
ecently, after I took a jab at right-wingers with closed minds who want closed borders, a reader asked: “Are you for open borders and the elimination of the Border Patrol? If you are not, please tell your readers what level of enforcement you would be for. Please come clean with your readers.” Fine. Let me come clean. I used the phrases “closed minds” and “closed borders” deliberately. Your mind has to be at least partly closed if you embrace the simplistic thinking that we can seal the U.S.-Mexico border — which stretches for nearly 2,000 miles — by just throwing more tax dollars at the problem. By the way, the U.S.-Mexico border is the only border that right-wingers care about; the longer boundary between the United States and Canada isn’t a concern. That’s not likely to change even after last week’s tragedy in Ottawa, where 32-year-old Michael Zehaf-Bibeau, a Canadian-born convert to Islam, killed a soldier at the Canadian war memorial before storming Parliament and being shot dead by the sergeant-at-arms. What if this type of incident had occurred in Mexico City? Imagine the reaction of those Repub-
lican members of Congress who have for several weeks irresponsibly claimed, with no evidence, that Islamic State militants have crossed the U.S.-Mexico border. They’d go ballistic. It’s the North American double standard, where the people many Americans are most afraid of seem to be those with a darker complexion. Speaking of double standards, many conservatives vehemently resist the concept of buying your way out of a fix when it comes to spending for education or health care or inner-city development, but they can’t wait to embrace the tactic when discussing the border. All of a sudden, money solves everything. In fact, throwing money at the border sometimes backfires. When we build walls and fences, we think we’re keeping out migrants but we’re ensuring that we’ll end up with more of them. We cage them in on this side of the border by making it hard for them to go home because they’re afraid they won’t be able to return — not without paying a fortune to smugglers. According to what I’ve been told by Border Patrol agents and supervisors, the human smugglers on the other side of the border give would-be migrants a menu of choices of how to get across. The final price is determined by the difficulty of the journey and the amount of risk involved. When Americans build higher walls and fences, or increase the number of Border Patrol agents, we increase the risk — and so smugglers respond by raising their rates. Fifteen years ago, a migrant who wasn’t picky
about how he crossed could make the trip for $500. Today, the average rate for expedited passage is closer to $5,000. If Americans spend another $500 million to build more fencing or hire more agents, human traffickers will probably raise their rates by another $1,000 per migrant. So, every time we fire off a round at our adversary, we put more money in his pocket, and that makes him stronger. That’s self-defeating. Here’s what I support. And it’s not open borders or eliminating the Border Patrol. Like any country, the United States has the right and responsibility to secure its borders — both of them — to keep its people safe. But you don’t do this by simply doubling the size of the Border Patrol from about 20,000 agents to more than 40,000, as the Senate immigration bill proposed. You do what the experts — those rankand-file Border Patrol agents — suggest. They don’t want more agents. What they really need are better roads, tunnel-detection devices and the latest computerized surveillance equipment so they can track who’s trying to cross the border from miles away and send agents to stop them. I’m all for being tougher on the border. But can’t we be smarter too? Reach San Diego-based columnist Ruben Navarrette at firstname.lastname@example.org.
North Texan’s blood is thick with our history: an independent, tenacious spirit; the love of wideopen spaces; and football. It doesn’t matter if your blood runs purple, green, blue, maroon or burnt orange. In North Texas, the fall weekends belong to football. It should come as no surprise that the new College Football Playoff National Championship chose North Texas to be the home of the inaugural title game on Jan. 12 at AT&T Stadium. Nor that Las Colinas is home to the College Football Playoff office, which is just down the street from the offices of the Big 12, Conference USA and the National Football Foundation. In other words, North Texas is at the center of the college football huddle. That’s great for fans of college football, but how does this benefit everyone else? Sports tourism is a rapidly growing segment of the North Texas economy. Since 2009, North Texas has hosted the Super Bowl, the NBA All-Star Game, the NBA Finals, the NCAA men’s basketball Final Four, two World Series and, of course, the annual Cotton Bowl Classic. Like these other world-class events, the College Football Playoff is expected to draw 100,000 domestic and international visitors to our region, which equates to full flights into D/FW Airport and Love Field, increased retail spending, hotels at capacity and the hospitality industry getting an added boost during what is traditionally a slow time of year. The Texas comptroller’s office expects this one event to have an economic impact of more than $300 million on our region’s economy. The College Football Playoff also gives us an opportunity to showcase the brand of the Dallas-Fort Worth region. Starting today, a distinguished 13-member selection committee will fly in and meet weekly at a local hotel to vote on and then release its weekly rankings. These men and women will have repeated exposure into the hospitality, the convenience and business benefits of North Texas. And, because the College Football Playoff offices are based in North Texas, our region will have home-field advantage for years to come — even in years that we don’t host a game. North Texas is home to a vast and diverse economy, from aviation and defense to utilities and transportation. Over the past five years, the leaders of our region have been hard at work expanding our commercial portfolio to include the business of sports, giving us added jobs, pumping millions of dollars into our economy and putting North Texas front and center during game broadcasts. Our region has been long known as the place where business champions are crowned — from Lamar Hunt to Mark Cuban, Jerry Jones to Ross Perot. It’s now quickly becoming the place where sporting champions are crowned. Game on. Mabrie Jackson is the president and CEO of the nonprofit North Texas Commission. Reach her at email@example.com.
A19 10-27-2014 Set: 20:40:35 Sent by: firstname.lastname@example.org News
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The Dallas Morning News
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Tuesday, December 2, 2014
Payday lenders: I remain uncomfortable with the idea that the city would do business with ACE Cash Express, which has payday lending as a major part of its business, even through a third party. There is a dissonance in the message.
White House teens: It’s a step in the right direction that the GOP aide who criticized the demeanor of President Obama’s teenage daughters at a routine ceremony has resigned. Even better: That aide should send the two girls a handwritten note telling them how sorry she is.
Rudolph Bush, editorial board member
Tod Robberson, editorial board member
Be charitable and social: Give online
BRIDGING DALLAS’ NORTH-SOUTH GAP | PROFITING OFF THE POOR
#GivingTuesday a nice antidote to Black Friday and Cyber Monday, says Mary Jalonick
The house at 6702 Grady Niblo Road, in far southwestern Dallas, was the focal point of a court struggle between Douglas T. “Chase” Fonteno’s organization and a couple seeking to recoup losses from an adverse possession house that Fonteno had sold them.
Questions of fraud and Fonteno Dubious notarized document adds to web of deception, Tod Robberson says
he red sign over the counter at the Dallas County records office warns: “It is a crime to intentionally or knowingly file a fraudulent court record or a fraudulent instrument with the clerk.” More simply, it’s a prosecutable offense to submit documents with forged signatures or signatures of fictitious persons or paperwork that has been manipulated to portray faked events. Investigators looking into how Douglas T. “Chase” Fonteno built his real estate empire, which includes adverse possession property claims, might want to scrutinize documents in county records that contain distortions of the truth. Let’s start with a document that doesn’t contain the name Fonteno but appears to have his fingerprints all over it. The document is an Oct. 29, 2013, deed in lieu of foreclosure on the house at 6702 Grady Niblo Road in far southwestern Dallas. Fonteno and his associates have filed scores of such documents, which allow a borrower to relinquish property instead of facing foreclosure. But in Fonteno’s case, it’s normally used to shuffle ownership among his various companies. In this case, the deed holder for 6702 Grady Niblo is a company called Niblo Investments, which lists itself at the same business address as Fonteno’s companies. The foreclosing company is Lorbek Investments Inc., which also lists its local representative at the same address as Niblo Investments and other Fonteno companies. Niblo Investments acquired the house from yet another Fonteno company, Deveron Properties Inc. Two notarized signatures on the Oct. 29 foreclosure deed are worth closer examination. One, signed on behalf of Niblo Investments, carries the name of Dan Peavy. (That is former Dallas ISD trustee Carver Dan Peavy, a longtime Fonteno associate.) The other, on behalf of Lorbek, is signed by “Mark Watson.” Mark Watson is a fake name that Fonteno uses, according to Peavy. Another longtime employee of Fonteno, Cecilia Flores, also told me that Mark Watson is a pseudonym Fonteno has used for years. During an18-month investigation, I’ve recorded three phone conversations with a person who identified himself as Mark Watson but whose voice appears to be Fonteno’s, based on recordings he’s posted online. I also gave my recordings to Peavy and another longtime acquaintance of Fonteno. After listening, they came to the same conclusion: It’s Fonteno. This isn’t the first time people around Fonteno have raised allegations of potentially fraudulent
The Dallas Morning News asked forensic document examiner and handwriting expert Wendy Carlson to compare four samples of Douglas T. “Chase” Fonteno’s signature with that of Mark Watson. Her determination: The documents were signed by the same person.
behavior. His former lawyer, Kristine Skocpol-Saleh, declared in a 2011affidavit that she “fired” Fonteno as a client on Aug. 31, 2010, only later to find that a signature purporting to be hers appeared on a court filing dated Sept. 20, 2010. She stated that he submitted false statements to the court and that, in one instance, her name was forged to a document. “You can imagine the conversation when I confronted Chase about all of this. Making accusations of fraud to the Court by one’s former client is a serious matter and I do not take the situation lightly,” Skocpol-Saleh stated in the 2011court affidavit seeking removal as defense counsel. “I have lived in fear that this man would follow through with his threats, should I stand up for myself.” The lawyer's affidavit said Fonteno had bullied her and threatened unspecified retaliation, including litigation. It is extremely rare for an attorney to make such a declaration against her own client in court. Skocpol-Saleh declined to comment further. The case she was handling involved a lawsuit filed against Fonteno by a family whose house was sold under an adverse possession claim by his Hilton Head Properties, without the family’s knowledge or permission. Fonteno, who was sentenced to prison for felony securities fraud, has not responded to repeated requests for comment on this or previous questions about his business activities. So what about Mark Watson’s notarized signature on the NibloLorbek document? The notary on the document is Rebecca Ann
Meadows, who works at the Inwood Road offices of Topletz Investments. Both Peavy and Fonteno have used those offices and her notary services frequently. State law requires notaries to keep ledgers of all documents they notarize, including listings of how they verified the true identities of the individuals signing the documents. I called Meadows to request access to her ledgers, but she said she doesn’t keep such logs. Her services are almost exclusively for personnel working in her office, she explained. Meadows said that if someone from outside the office asked for notary services, she would require a photo ID. Shown the document, Meadows said she doesn’t recall notarizing Mark Watson’s signature. “I have looked at this document in detail and have absolutely no knowledge of signing this document,” she said. “This is just not correct.” Her employer, Dennis Topletz, said no one named Mark Watson works there. A court-certified handwriting expert, Wendy Carlson, examined the signatures on the document at The Dallas Morning News’ request and for a fee. She says the person who normally signs as Carver Dan Peavy is the same one who signed this document as Dan Peavy. As for the person who signed as Mark Watson, “Douglas Fonteno did indeed sign the name Mark Watson on the questioned document,” she stated in a Nov.12 affidavit. Interestingly, the name Mark Watson also appears in the articles of incorporation filed with the Florida secretary of state’s office for Lorbek Investments. Fraud is a felony offense under Florida law, just as it is in Texas, and the interstate nature of
this activity could be grounds for federal intervention. It’s not clear why a fake name was necessary on the document. But the date of the filing is revealing. The Grady Niblo foreclosure occurred just as a judge was ruling against Fonteno and Deveron regarding yet another house that Fonteno had sold using an adverse possession claim, even though the property didn’t belong to him. The buyers, Victor Gomez and Irma Rodriguez, claimed they had been defrauded. The couple’s lawyer, Fernando Martinez, zeroed in on the Grady Niblo house as one with enough value to cover damages his clients were seeking. Unlike most of the nearly worthless houses in the Fonteno portfolio, this one is new and well-appointed, worth more than $365,000. Martinez asked the court to attach the property to any judgment favoring Gomez and Rodriguez. If Fonteno — or Mark Watson — was attempting to transfer the property to put it out of reach for the compensation claim, he failed because the judge ruled in Martinez’s favor. The tactics used in this maneuver offer new clues about how Fonteno does business. If county and federal prosecutors fail to follow up, they might as well remove the warning sign from the county’s records room because, otherwise, people like Fonteno will continue to abuse the system. Dallas Morning News editorial writer Tod Robberson may be contacted at email@example.com.
n Friday, many of us awoke in the wee hours — on purpose — to fight unruly, bargain-crazed crowds in pursuit of perfect, affordable gifts. Even as its start time creeps into Thanksgiving Day itself, Black Friday has become an annual day of frenzy — beloved by some, reviled by others. Then there’s Cyber Monday, the online shopping spectacle that encourages dealscoring from laptops and handheld devices. It’s become really easy to spend. Refreshingly, it’s also becoming easier to give. I hope by now you’ve heard of #GivingTuesday, a movement so social it has a hashtag in its title. The antidote to Black Friday and Cyber Monday, #GivingTuesday is exactly as it sounds: a global day dedicated to giving. Today marks the third annual #GivingTuesday, when “charities, families, businesses, community centers, and students around the world will come together for one common purpose: to celebrate generosity and to give.” Combining “giving” with “social” has become the new norm for many charities. It’s practical, providing donors with a quick, paperless way to make contributions. It has a psychological benefit as well by allowing people to be part of a larger movement. Not surprisingly, millennials — social, cause-aware creatures that they are — are particularly drawn to these programs. The recent success of the ALS Ice Bucket Challenge proves the point. Not only did the challenge entice millions to film themselves pouring ice water on their heads, but, defying the skeptics, many also took the trouble to follow up with monetary contributions. The ALS Association reports receiving $115 million in donations since July, many from donors identified as students and young professionals. Though it didn’t start out that way, as with the Ice Bucket Challenge the potential of #GivingTuesday comes from social media. For example, this year, we are being encouraged to take an #UNselfie and post it along with information about why and to whom we are giving. The idea is for our friends and followers to see and be inspired to give and share, prompting a ripple effect. Though online giving is still a small part of it, philanthropy as a whole is faring well. The annual national report on philanthropy shows an increase of 4.4 percent in 2013 — the fourth consecutive year of growth — to a whopping $335 billion. What excites us at the Dallas Foundation, the oldest community foundation in Texas, is that as #GivingTuesday takes root, it becomes an annual occasion to support and promote the more than 8,000 local charities in the Dallas-Fort Worth area. Since 1929, we’ve sought to fill gaps and link donors to the community issues and nonprofits where their money will make the most impact. This holiday season, there are numerous ways to help those in need who are right in our backyard. According to Mayor Mike Rawlings’ Poverty Task Force, Dallas has the thirdhighest poverty rate among U.S. cities with populations larger than 1 million — and it has the highest child poverty rate among those cities. And despite Dallas’ growing prosperity, every council district in the city has seen an increase in its poor population. That should not be the state of our community. So today, bring that shop-till-youdrop stamina to #GivingTuesday. Give however you can and say thanks to your favorite local charity with a donation. Post an #UNselfie and share on Twitter why you give. Order a Giving for Good card from our website as a holiday present for friends and family. The cards work just like a retail gift card, except the value can be donated to any nonprofit in Dallas or the United States. Above all, spread gratitude, today and every day. Mary Jalonick is president of the Dallas Foundation. Reach her at mjalonick@ dallasfoundation.org.
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Monday, December 29, 2014
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Denying safe haven for ‘real estate catburglar’ Draft bills aim to ensure abuses can’t happen again, says Tod Robberson
In a blog posting, Douglas T.“Chase” Fonteno promoted himself as “the Real Estate Catburglar.” The blog and website are gone, but his “real estate catburglar” videos are online.
bankruptcy limbo — again, with taxes and liens unpaid. More victims came forth. Public outrage grew. Mayor Mike Rawlings and City Attorney Warren Ernst joined in expressing frustration and calling for a review of county prosecutorial options. That hasn’t happened yet, although this merits the attention of incoming District Attorney Susan Hawk. Fonteno, whose voluminous mortgage, deed and foreclosure documents for years regularly hit the Dallas County records office like a paperwork blizzard, has ceased filing anything. The last real estate document he filed in county records was on May 14, four days before this series began. Fonteno’s blog site and company website have disappeared from public view, although his “real estate catburglar” videos remain online, instructing viewers how to acquire cheap slum residential property. Close associates, including Topletz, say Fonteno’s whereabouts are unknown. His former residence at 5535 Ranchero is vacant and decaying. Early this month, Travis G. Kasper, a California tax and bankruptcy attorney who said he represented Fonteno, called the newspaper and said he wanted to discuss the series. But he has not responded to follow-up phone calls and emails. In the Legislature, as many as five bills are being prepared to ensure that activies such as Fonteno’s receive proper attention from law enforcers and other officials charged with fighting fraud and upholding the integrity of public records and real estate transactions. One draft seeks to make county clerks more accountable for the documents they allow into their registries. Others take aim at adverse possession
READ previous installments in this series. dallasnews.com/opinion
statutes and real estate fraud. Rep. Eric Johnson, a Democrat whose district includes southern Dallas, is spearheading the effort. One North Texas Republican legislator told me he’d like to sign on to the effort once he sees the draft legislation. Earlier this year, the Texas Department of Savings & Mortgage Lending assessed a $4,500 penalty against Fonteno for issuing mortgageloan contracts without a license. He did not appear for a hearing in Austin early this month, a department official said. The Texas secretary of state’s office, which oversees notary licensing, opened an investigation after this series reported on the potentially fraudulent document filing and unauthorized use of the notary’s seal that involved Fonteno and the offices of Topletz Investments. Belinda Kirk, who handles complaints for the office, says the secretary of state is seeking guidance from the Texas attorney general’s office. The U.S. attorney’s office also continues to express interest but is adhering to its policy of not discussing investigations. One thing that’s clear: The real estate catburglar no longer enjoys impunity. His days of profiting off Dallas’ poor may soon be over. Dallas Morning News editorial writer Tod Robberson may be contacted at email@example.com.
To reach university, take a left at the lectern Jay Ambrose is troubled by scarcity
of conservatives in higher education
he leftists are coming, the leftists are coming. No, wait. I am wrong. They are already here, not least of all in our universities, where they coexist with postmodernists but very few conservatives. Phooey on diversity, they say, and then they do other things, extreme things like having students learn and recite the following pledge of allegiance. “I pledge allegiance to wrap myself in the flag of the United States against anything un-American and to the Republicans for which it stands, two nations, under Jesus, rich against poor, with curtailed liberty and justice for all except blacks, homosexuals, women who want abortions, communists, welfare queens, tree-huggers, feminazis, illegal immigrants, children of illegal immigrants, and you, if you don’t watch your step.” The perpetrator here is Dr. Charles Angeletti of Metropolitan State University in Denver. The original source of the story, a blog called Campus Reform, quotes him as saying the pledge is a spoof he uses in his American civilization class to engender critical thought about national leadership. The words strike me as more nearly a rant meant to indoctrinate. My concern is not just that this one person is going too far in the classroom in simplistic, ultra-
Bush’s silence is graceful Former president has taken high road on current issues, Obama, says Cass Sunstein
even months ago, Dallas Morning News readers got an introduction to Douglas T. “Chase” Fonteno, the self-described “real estate catburglar.” He built a residential property empire in Dallas by filing legally dubious claims to houses without the knowledge or permission of the real owners, then issuing mortgages on those houses to buyers who didn’t know better. Fonteno has left a long trail of victims, including low-income clients bilked into making payments on houses without realizing they were nothing more than squatters. Real deed-holders to these properties were horrified to learn their houses were being occupied. Some spent thousands of dollars in legal fees and are still in court trying to recoup losses. Now Dallas City Hall is working with a local legislator on several measures to ensure such abuses don’t happen again. A special report, published in May, documented how Fonteno’s adverse-possession organization worked, an operation involving more than 20 companies registered at the same addresses and listing Fonteno and his close associates as the executives. They filed massive numbers of documents with the Dallas County clerk that lent their companies the appearance of ownership and legitimacy. Over the past decade, those companies have claimed ownership, via adverse possession and similar contractual wording, to more than 80 houses in the poorest neighborhoods of southern Dallas. Subsequent installments documented how Fonteno expanded his real estate holdings through connections with one of the city’s biggest slumlords, the Topletz family. He worked out of their offices and took advantage of their in-house notary to churn out dozens of official-looking real estate transactions. Fonteno brought family patriarchs Harold and Jack Topletz and Harold’s son Dennis into mortgage-financing arrangements on dozens of properties, some claimed through adverse possession and others purchased conventionally. Dennis Topletz says the company did not wittingly participate in Fonteno’s adverse-possession operation. Documents make clear they loaned him money and helped him advance that business. In November, Dennis Topletz expressed regret for that association. He was particularly irked when he learned that a Fonteno real estate document on file with the county included the Topletz office notary’s seal accompanying what appeared to be a fake name and signature. The notary said she had no knowledge of the document. Topletz indicated that Fonteno also left behind a significant, unpaid debt. “I have distanced myself from Chase Fonteno,” Topletz told me. “I have nothing else to do with him.” Topletz isn’t the only one trying to collect. I documented $1.5 million in taxes owed on the residential properties in Fonteno’s inventory, along with at least $234,427 in unpaid state and federal taxes. Another column showed the damage Fonteno caused after he purchased an expanse of rundown apartments in South Dallas with the promise of renovating them. Instead, he abandoned the project and left the property frozen in
biasedways,assomestudentsargue,butthatuniversitiesdonotharborsufficientideologicaldiversitytooffsetsuchinfluences.Universityleftismis widespread,asweseeinanotherquote: “ThepowerbaseoftheleftinAmericaisnowin universities,sincethetradeunionshavelargelybeen killedoff,”saidthelate,widelyinfluentialphilosopherRichardRortyinTheProfessors,abookin whichDavidHorowitzexploresabsolutelyastonishingprofessorialoverreaching. Asmuchisdemonstratedbysurveysshowing thevastmajorityofprofessorsinmostuniversities areDemocratsandbyidentity-basedcoursesthat toooftendismisstraditionalWesternvaluesas nothingmorethananattemptbyadvantagedwhite mentoexertpower. Eveninthekindofpoliticalsciencecoursesyou takeforamaster’s degreeattheUniversityofColoradoatDenver,you’llfindaprofessorwhothinksthe pseudoscientific,humanlyconfusedKarlMarxwas rightinhispredictionsaboutourultimatedestiny eventhougheffortsinhisnamehavesofarkilledoff 100millioninnocents.KristaKafer,afriendofmine, wroteaboutthisintheDenverPost,alsotakingnote ofaprofessorwhothoughttherewasnogoodorevil, just“socialconstructs.” Whatwehaveinthisexampleisapostmodernist ofthekindthatsaysthereisnotruth,justcultural beliefs.Ofcourse,thisassertionwouldthen,asa matteroflogic,alsobenothingmorethanacultural belief,althoughithappenstobeacommononethat canfosterhorrificconsequences.Afterall,suppos-
ingnothingisfinallymoralorimmoral,justamatter ofabeliefinaworldinwhichallbeliefsaremoreor lessequal,meansthatanydeedisacceptable.Goodbye,civilization. InTheClosingoftheAmericanMind,abook publishedin1987,anoutstandingUniversityof ChicagoprofessornamedAllanBloomwarnedof somethinglikethisnihilismtakingstrongholdin universitiesandpersuasivelyarguedthereissomethingcountertosuchrelativisttomfoolery,somethingonceknownaswisdom. Conservatism,yousee,isnotjustaboutpolitics oreconomics,butaboutacertainsenseoftheworld thatappreciatesthebestofthepast,andthereare thosewhoseethegoodinthat. AttheUniversityofColoradoatBoulder,some studentscomplainedofinescapableliberalleanings inmostclassroomsand,inresponsetotheirarguments,theinstitutionisnowbringinginavisiting conservativescholareachyearforatleastafew years.Itmightseemastepintherightdirection,but thinkaboutitforamoment—asingleconservative? Evenifthereareahandfulofothersonthefaculty, doesn’tthatsaysomethingdisturbingaboutthe rangeofintellectuallifeattoomanyofouruniversities? JayAmbroseisanop-edcolumnist forTribuneNewsService.Reach firstname.lastname@example.org.
n the domain of foreign affairs, 2014 has brought heated national debates on an impressive range of subjects: Russia, Ukraine, Iran, Syria, Ebola, immigration policy and, most recently, torture, North Korea and Cuba. One of the more remarkable features of all these discussions has been the consistent grace of President George W. Bush. This month, Bush offered a rare comment on a public debate. Responding to the Senate’s release of the CIA torture report, he said, “We’re fortunate to have men and women who work hard at the CIA serving on our behalf. These are patriots and whatever the report says, if it diminishes their contributions to our country, it is way off base.” Note that Bush paid tribute to the employees of the CIA — and pointedly declined to take a shot at the Barack Obama administration. No one doubts that, on some important questions, Bush is in profound disagreement with his successor. Nonetheless, he has maintained silence. In March, he explained, “I don’t think it’s good for the country to have a former president undermine a current president; I think it’s bad for the presidency for that matter.” To many Republicans, that crisp explanation is not convincing, but Bush has made an honorable calculation. He was president for eight years, and the substance of his own views is hardly absent from public debate today — whether or not he raises a personal objection while out of office. He’s aware that whenever a former president speaks out against the current one, the criticism gets amplified beyond its merits. Bush doesn’t want to exploit his past role in that way. “I really don’t long for publicity,” he said. “I’m perfectly content to be out of the limelight.” Contrast that statement with the case of Leon Panetta, Obama’s former CIA director and secretary of defense. In his book Worthy Fights, he discloses internal debates that officials expected to remain private and complains that the White House was “so eager to rid itself of Iraq that it was willing to withdraw rather than lock in arrangements that would preserve our influence and interests.” In an interview promoting his book, he said of Obama, “These last two years, I think he kind of lost his way.” Similarly, in his book, Duty, Robert Gates, who was secretary of defense under both Bush and Obama, writes that in 2010, he concluded that, with respect to Afghanistan, Obama “doesn’t believe in his own strategy, and doesn’t consider the war to be his. For him, it’s all about getting out.” Gates adds that “agreements with the Obama White House were good for only as long as they were politically convenient.” It should go without saying that if Panetta and Gates had not had the privilege of working in the Obama administration, few people would pay attention to their books. The contrast with Bush could not be greater: Panetta and Gates have exploited their own roles. Unlike a former president, moreover, former Cabinet members owe a duty of loyalty to a sitting president, not least because they have been able to participate in internal discussions. In those discussions, officials generally deserve to be able to speak on the understanding that what they say will not appear in a book — certainly not while the president remains in office. Sure, confidentiality and loyalty have limits. If a former official was exposed to genuine wrongdoing — for example, in the form of illegality, as opposed to policy disagreements — he or she may have a duty to speak out. Neither Panetta nor Gates points to such wrongdoing. Public figures are ordinarily rewarded for what they say, not for what they don’t. Grace is an underrated virtue; gracelessness is an insufficiently acknowledged vice. For his understated remarks about the CIA and his continued silence about his successor, a salute to George W. Bush — along with hope that, when he leaves office, Obama will follow the example. Cass Sunstein, the former administrator of the White House Office of Information and Regulatory Affairs, is the Robert Walmsley university professor at Harvard Law School and a Bloomberg View columnist. Follow him on Twitter at @CassSunstein.
A17 12-29-2014 Set: 12:46:23 Sent by: cci News
BLACK YELLOW MAGENTA CYAN
Published on May 18, 2014
Chronicling the damage caused by the wanton abuse of Texas adverse-possession laws by a Dallas entrepreneur who manipulated property deeds t...