Recidivist Just Can’t Do Right, Investor Says

SALT LAKE CITY (CN) - A Nevada company claims in court that it lost $2 million to securities recidivist D. Shane Baldwin.

McEwen Properties sued Baldwin and his company Silverleaf Ventures, Mark Staples and his company Silverleaf Financial, and Trailhead Lodge Acquisitions, Ross Baldwin and Cary Clark in Salt Lake County Court.

In a separate, related complaint in the same court, McEwen Properties sued Baldwin, Staples, the two Silverleaf entities, and Kingswick Holdings.

"In 2010 the State of Utah charged Shane Baldwin with two felony counts of criminal securities fraud and two counts of theft for deceiving two people with promises of big profits in return for investing in a company Shane Baldwin controlled," according to the complaint that includes defendant Kingswick. "Shane Baldwin pleaded guilty to two counts of felony attempted theft in 2010 and entered into a plea in abeyance."

The complaint continues: "In June 2011, a group of investors sued SL [Silverleaf] Financial in Nevada District Court, alleging that they were defrauded out of $1.2 million when SL Financial, an entity controlled by Shane Baldwin, misrepresented the true ownership of a pool of foreclosed residential and real estate properties."

But that's not all, the complaint says: "Shane Baldwin, SL Financial, Staples, and others are also defendants in another suit pending in the Third Judicial Court of Utah brought by Q-6 Associates LLC ... in which fraudulent conduct is also alleged. The lawsuit by Q6 Associates alleges that Shane Baldwin lives a 'lavish lifestyle ... [and] flies around in two twin-engine private planes, drives a Porsche Panamera, has front-row tickets to the Utah Jazz, and gives away expensive gifts.'" (Ellipsis and brackets in complaint.)

McEwen then refers to its second complaint against Baldwin et al.

According to the complaints, McEwen Properties' owner Terry McEwen, invested $1 million in Kingswick in June 2011 and loaned $1 million to SilverLeaf in September that year.

McEwen claims that Baldwin told him Kingswick owned properties in Illinois and Missouri, that SilverLeaf Financial had a long-term investor committed to Trailhead, that a loan would be secured by common units of SilverLeaf Acquisition Holdings, and that the money would be repaid within 10 days.

However Baldwin failed to tell him "that Shane Baldwin had a history of obtaining money from purported lenders and investors by fraudulent means and that he was continuing to do so," McEwen says in the Trailhead complaint.

Nor did Baldwin tell him that he had "pleaded guilty to two counts of felony attempted theft," or about the $1.2 million lawsuit in Nevada, or that some of all of the units that Baldwin and Silverleaf promised McEwen as collateral "had already been sold, foreclosed upon, or otherwise transferred to or encumbered to someone else," the complaint states.

McEwen says Baldwin "failed and refused" to repay the loan, and that he "would not have loaned any money to SL Financial if Shane Baldwin told him the truth."

McEwen seeks $1.1 million in damages for fraud, breach of contract and partnership liability in the Trailhead suit, and a preliminary injunction and temporary restraining order to keep the defendants from misappropriating Kingswick's assets in other complaint.

It is represented by Keith Call with Snow, Christensen & Martineau.

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