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Lenders finally caught up with Jim McConville Wednesday when they foreclosed on his luxurious East Bay ranch. But that is small comfort to investors who say he built it all using their money.
McConville built an 80-acre ranch for himself in the Castro Valley Hills.
"It was a gorgeous place," said Jack Thomas who worked for McConville.
It is where former employees say he kept his $1.5 million collection of classic cars, including two Lamborghinis, a 1969 Mustang Fastback, and a 1966 Cobra, along with more than $6 million worth of antique furniture, art and jewelry.
"A lot of people that drove by would drive up the road and mistake it for a country club -- it was that nice -- and now it's just a dump, literally," said Thomas.
The property is abandoned today. Garbage is piled in the courtyard and the garages where McConville stored his expensive cars are empty now, except for a broken-down van.
"He stripped every light fixture, every light bulb, ceiling fans, took the water heaters out of the houses, the air conditioning units off the side of the houses," said Thomas. "He even took the metal drain grates."
A lender foreclosed on the main house in August. The rest of the ranch reverted back to another lender in a trustee sale on the steps of the Alameda County Superior courthouse in Oakland on Wednesday.
"There being no further bids, this property is sold to the beneficiary for $100,001," said the auctioneer.
That is no comfort to former investor Andy Narraway. He says McConville used his life savings to subsidize a lavish lifestyle.
"When you live on a 100-acre ranch in Castro Valley, you've got, you know, two Lamborghinis, 20 muscle cars, you've got personal assets and art collection and furniture and valuables worth $6.2 million according to court documents, then where's that money coming from?" said Narraway. "It's coming from people like me and other investors."
Narraway is suing over five loans he says he made to McConville between 2003 and 2005, totaling nearly $1.9 million. Narraway says McConville promised to pay a 10 percent annual return and gave Narraway second liens on five properties around the Bay Area as security.
But, he says, McConville inflated the value of those properties -- in some cases to nearly twice their actual worth -- so when McConville stopped making payments and the banks foreclosed, Narraway's investment got wiped out.
"Sometimes it's overwhelming," he said. "I mean, literally, my world has been turned upside down from eight months ago, even with everything that's going on in the economy, I thought that I would be fine -- and now my life savings have just gone."
Dozens of other investors say McConville duped them, too. According to several investors and lawsuits filed against him, McConville offered them $10,000 if they would help him with a straw purchase.
They say he used their good credit to buy condos up and down the state, in some cases taking hundreds of thousands of dollars in marketing fees for his company. Then, he defaulted on the payments, ruining investors' credit.
"He was collecting the rents and sticking them in his pocket and not paying the mortgage," said Thomas.
Thomas headed the construction crews rehabbing McConville's condos. He became an investor himself. McConville used his name and good credit to purchase 11 properties worth more than $10 million -- all of them now in foreclosure.
"I get at least 15 phone calls a day from banks," said Thomas.
The I-Team caught up with McConville last month at small claims court in Fremont, where Thomas was suing one of McConville's companies for $7,500 in unpaid wages.
Dan Noyes: "What do you say to someone like Andy Narraway who lost his life savings? Could you please stop pushing me?"
McConville refused to answer our questions.
Noyes: "Where are all the cars? Jim, where are the 20 cars? Lamborghinis, Cobras, the rest?"
He shoved our camera, hurried down the stairs out to the street, and into a waiting car which sped away.
Thomas won his case against McConville, but he is still waiting for his money. The FBI is investigating, and former investors tell us the agents are trying to find out what McConville has done with his fortune -- the money and all those cars.
To see a list of McConville's cars, we've posted some court documents in this case in a new I-Team blog.
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