Colorado Claims Land Scammer Took Millions

     DENVER (CN) - A land scammer bilked people of $2.5 million for a supposed 37-acre development for which he never even bothered to get construction permits, the Colorado securities commissioner claims in court.
     Jurgen Denk skimmed $1 million of the money for himself, his wife and a crony, the state says in its lawsuit in Denver County Court.
     Securities Commissioner Fred Joseph also sued Denk's company, Talking Water, and his "financial adviser" Michael Philip McNamara, individually and dba Brentwood Equity Advisors.
     Denk paid McNamara $200,000 for selling supposed membership interests in Talking Water, the state says.
     Denk, a German citizen living in Colorado, claimed he would develop land along the Uncompahgre River outside of Montrose, but never put even two sticks together, according to the complaint.
     "Beginning in at least 2007 and continuing into 2010, Jurgen Denk fraudulently solicited more than $2.5 million from investors for a land development near Montrose, Colorado called Talking Water LLC," the lawsuit states.
     "Denk and others misrepresented to investors that investments in Talking Water would outperform the stock market, and that Denk was poised to begin building and selling homes on the banks of the Uncompahgre River in Montrose, Colorado - where due to overflow from Telluride, 'Billionaires are pushing Millionaires out!' Investors were falsely promised 15 percent interest during the construction phase as well as a share of the net profits. Even though Denk never obtained construction permits for the land, failed to pay loans secured by the land, failed to pay property taxes resulting in tax liens, and failed to disclose the existence of $1.5 million mortgage lien held by the seller, Denk paid himself at least $700,000.000 in 'management fees,' paid McNamara nearly $200,000 in 'finder's fees,' and paid his wife, Lisa Denk, at least $95,883.22 for her 'services,' depleting the assets of Talking Water and enriching himself, his wife and McNamara at the expense of investors."
     Lisa Denk is not named personally as a defendant.
     McNamara had several balls in the air, the state says: "McNamara sold Talking Water investments to clients to whom he also sold interests in other purported real estate investment funds managed by a company called Life's Good. He later convinced Life's Good to invest more than $1,000,000 in Talking Water, creating a conflict of interest. Life's Good was later exposed to be a massive Ponzi scheme, and is now in receivership," according to the complaint.
     Denk told his suckers that Mesa County had a "steadily growing market without any boom-and-bust cycles." But by 2010, Talking Water was a bust, with just $287 in its coffers, the state says.
     The commissioner seeks restitution, an injunction and penalties for sale of unregistered securities, unlicensed sales, and securities fraud.
     McNamara's employer, Brentwood Equity Advisors LLC, and two companies he owns, Sierra Capital Resources LLC and JOMAC LLC, also are named as defendants.
     Pulse Asset Management LLC and LKJ Services LLC, formed by Jurgen and Lisa Denk respectively, are named as relief defendants.