SAVOY SENIOR HOUSING FRAUD
Details the dozens of small mom and pop businesses that Jake Frydman put out of business by hiring them and not paying for the work they did for his failed projects.
In addition to screwing a church and charitable organization the endless lawsuits that outline the specifics of the fraud can be found here.
This site elaborates on a twisted individual named Jake Frydman, who hurt so many elderly people, all for greed
PRESS ARTICLES RELATING TO THE FRAUDS
Knight Ridder/Tribune Business News
March 12, 2004
By Jennifer L. Berghom, The News & Advance, Lynchburg, Va.
The bank that financed $20 million for the Liberty Village retirement community filed a lawsuit against the developer and its affiliates seeking nearly all of the money it loaned, saying it has not received payment.
Community National Bank, of South Boston, is seeking $19,950,957.75 plus interest from Liberty Village Associates Limited Partnership, its affiliate Savoy Retirement Communities Inc. of New York and Jacob Frydman, president of New York-based Savoy Senior Housing, the main partner of Liberty Village Associates Limited Partnership.
The proposed 140-acre retirement community atop Candlers Mountain in Campbell County has been at a standstill for more than a year. The developer faces nearly $3 million in other lawsuits filed by subcontractors and an investigation by the Virginia Department of Environmental Quality for violations.
According to the lawsuit filed March 4 in Campbell County circuit court, the bank claims that Liberty Village has defaulted on a promissory note signed on May 7, 2001, and now is seeking the principle plus the daily interest owed, $2,602.79, that was effective March 1.
The promissory note states that the bank would provide up to $20 million for purchasing land, developing and making improvements to the land, marketing and selling or renting the properties. The note allows the developers two lines of credit: one for $8.5 million for construction of infrastructure improvements and another one for up to $20 million for construction, development, marketing and sale of the properties.
Included in the lawsuit is a letter dated Jan. 16, 2004, from one of the bank’s attorneys, John L. Gregory III of Young, Haskins, Mann, Gregory & Smith of Martinsville informing Liberty Village’s developers that if they do not pay the bank the $972,779.63 in interest owed from Jan. 1, 2003, to Jan. 1, 2004, by Feb. 2, the bank would declare the entire amount owed due and would take measures to remedy the situation.
Philip G. Gardner, of Gardner, Gardner, Barrow & Sharpe P.C. of Martinsville, who is handling the lawsuit for the bank, said the lawsuit is one of three actions taken against the developer and affiliates. Gardner said the affiliates are embroiled in a lawsuit in New York and Young, Haskins, Mann, Gregory & Smith is handling the foreclosure on the property. The attorney said he is not sure how the New York lawsuit and foreclosure will affect this lawsuit.
He added that he has notified the defendants about the lawsuit but is not certain if they have officially received the papers.
Lawsuits filed by nearly 20 subcontractors began piling up in December 2002 and are still pending. One lawsuit a potential homeowner filed against the developer last year was settled last summer.
Frydman told The News & Advance in February 2003 that his company believes that the liens filed against Liberty Village Associated LP were not valid.
Construction has come to a halt and no building permits have been issued, according to Campbell County’s Department of Community Development. The retirement community is located in the county just past the Lynchburg border.
The county issued a stop work order in March 2003 against Liberty Village Associates LP because it violated its erosion and sedimentation plan and hired a Rustburg-based excavating company to complete the work. Construction trailers have been removed and condominium buildings located in the southern part of the property remain unfinished.
A phone call made to Frydman was not returned Wednesday and no one from the company was available at the site. The doors to the visitors’ center were locked.
In July, Savoy Senior Homes’ director of construction Chalmers McCombs told The News & Advance that the developer was working with other sources on obtaining more money to restart the project.
Knight Ridder/Tribune Business News
February 7, 2003
Along with paying the contractors that have filed liens against Liberty Village Associates Limited Partnership, the retirement community’s developer must also keep up on bank payments and continue to operate other properties.
New York-based Savoy Senior Housing is the main partner. TRBC Ministries Inc., an affiliate of Liberty Broadcasting Network and an entity of the Rev. Jerry Falwell’s ministries, holds a small interest in the partnership.
The News & Advance reported on Thursday that contractors and subcontractors working on Liberty Village have filed more than $1 million worth of mechanics liens on the property.
Savoy also runs retirement communities in Little Neck, N.Y., and Brooklyn, N.Y., and is working on one in Ocala, Fla. According to its Web site, Savoy was founded in 1997 by real estate developers
Jacob Frydman and Hy Carlinsky.
The deed of trust to Liberty Village is held by South Boston-based Community National Bank, which made a $20 million loan to the partnership in May 2001. The loan agreement gave the partnership access to two lines of credit.
The first line of credit was for $8.5 million. The second line is for up to $20 million, but the total loan can never exceed $20 million. The partnership had to start paying the interest on the loan monthly in June 2001, and the full loan plus interest must be repaid by June 2006.
As of June 2001, the bank had total assets of $202 million — so the loan to Liberty Village represented almost 10 percent of the bank’s assets. As of September, the latest date for FDIC statistics, the bank has assets of $226 million and liabilities of $208 million.
Frydman said that to the best of his knowledge, the partnership isn’t behind on loan repayments.
Bank officers and Worth Harris Carter Jr., who is president and chairman of the board of Central National and other banks, did not return calls for comment.
To keep up on payments, Liberty Village needs to get new residents moved in and making payments. Frydman said business is “moving forward at an acceptable pace,” and that four to five families have moved in.
In late 2001, Frydman told The News & Advance that Savoy had already sold 125 houses, villas, townhomes, carriage homes and “liberty” homes even before a model was built. He said Wednesday that he meant there were 125 deposits at the time, and that deposits don’t always end up as sales.
He said he didn’t know how many sales had been made so far, and the sales office would know. The sales office referred questions about sales to Frydman.
When asked if the Liberty Village partnership’s liabilities fell entirely on Savoy, Frydman said he didn’t “believe that was true at all.”
Frydman did not say whether a Falwell entity or some other entity carried liabilities in the partnership, but Liberty Broadcasting Network President Ron Godwin said Wednesday that TRBC Ministries doesn’t incur any of Liberty Village’s liabilities.
Knight Ridder/Tribune Business News
March 31, 2004
By Jennifer L. Berghom, The News & Advance, Lynchburg, Va. Knight Ridder/Tribune Business News
Jacob Frydman, the developer of the beleaguered Liberty Village retirement community says it does not owe a bank $20 million and says the bank and a branch of the Rev. Jerry Falwell’s ministries have tried to continue the development without them. The proposed 140-acre retirement community atop Candlers Mountain in Campbell County, near Liberty University, has been at a standstill for more than a year.
The accusations by Liberty Village Associates Limited Partnership come from court papers filed in New York following a lawsuit by Community National Bank of South Boston earlier this month.
Jerry Falwell Jr., general counsel for the Falwell ministries, said Tuesday that Frydman the developer’s accusations were “ludicrous.”
The bank’s suit seeks $19,950,957.75 plus daily interest of more than $2,600 from Liberty Village Associates Limited Partnership, its affiliate Savoy Retirement Communities Inc. of New York and Jacob Frydman, president of New York-based Savoy Senior Housing, the main partner of Liberty Village Associates Limited Partnership.
The bank issued two lines of credit: one for $8.5 million for construction of infrastructure and another one for up to $20 million for construction, development marketing and sale of the properties. The entire loan was not to exceed $20 million. Liberty Village Associates LP said in court documents last week it has until June 2006 to repay the loan. The partnership also says it has repaid roughly $500,000.
The developer also states that the bank improperly rejected its requests for more money, preventing it from completing the project.
Liberty Village Associates LP claims that if it had been able to draw money and continue the project, it could have generated more than $3.6 million in sales and completed two sewer pumping stations for the project.
The developer also states that TRBC Ministries had a long-standing banking relationship with the bank and was responsible for the bank’s participation in the project. The ministries’ involvement was crucial to the project, the court documents state, because the value of the land was based in part on the project’s development in conjunction with the ministries.
Lawyers representing Liberty Village Associates LP and the bank did not return phone calls Tuesday.
Jerry Falwell Jr., the general counsel for the Falwell’s ministries, said Tuesday that the developer’s lawsuit is “ludicrous and without basis.”
“I think the suit was just filed out of desperation,” he said.
TRBC Ministries, an affiliate of the Rev. Jerry Falwell’s ministries, holds a small interest in the partnership, Falwell Jr. said. He said that the limited partnership purchased the land for $600,000 from the ministries. In return, TRBC Ministries was to receive either 10 percent of the project, or 2.5 percent gross of every home sold, whichever was more, as a fee for marketing the project. The partnership did not pay the ministries in a timely manner, so the ministries stopped marketing in late 2002 or early 2003.
“And that was the end of our involvement,” Falwell Jr. said.
The partnership alleges in its suit that TRBC Ministries announced publicly that the project would reopen this spring. The partnership also alleges that the ministries have been “conspiring” with the bank to remain involved in the project.
Falwell Jr. also denied those claims, adding that his father might have mentioned at a Christmas party that he would like to see the project resume, but neither he, his father nor TRBC Ministries are aware of any plans to continue building the proposed retirement community.
“It sounds like they’re trying to say we’re working out some deal with the bank. None of that has occurred,” he said.
Falwell Jr. said the ministries plan to file a response to the developer’s claims in New York County’s Supreme Court.
Frydman also faces nearly $3 million in lawsuits filed by subcontractors seeking to enforce mechanics liens. Those lawsuits, which began piling up in Campbell County Circuit Court in December 2002, are still pending.
The general contractor has left the development and empty lots remain where construction trailers once stood. Dirt paths mark where roads would have been extended and weeds have sprung up throughout the property and potholes have formed on roads already paved.
Three families live in the beleaguered development, using the one open gate in front as the point of entry and exit. One of the residents said from her vehicle last week that she and her neighbors are fine despite the situation.
“We’re just waiting,” she said.
Knight Ridder/Tribune Business News
February 5, 2003
More than $1 million in mechanic’s liens have been filed in Campbell County Circuit Court against the developer of the Liberty Village retirement community. Several local contractors say they have yet to be paid for their work on the project, a 140-acre community designed for 1,400 residents age 55 and older.
New York-based Savoy Senior Housing Corporation is developing the project as the general partner of Liberty Village Associates Limited Partnership, which owns Liberty Village.
The planned retirement community is near Liberty University in Campbell County, just outside the city limits.
TRBC Ministries Inc., an affiliate of Liberty Broadcasting Network and an entity of the Rev. Jerry Falwell’s ministries, holds a small interest in Liberty Village Associates L.P. However, Liberty Broadcasting Network President Ron Godwin said that interest was so small that TRBC Ministries would not incur any of Liberty Village’s liabilities.
Godwin said TRBC Ministries Inc. was given “a very small interest in this partnership” as partial payment for marketing the project on Falwell’s Old Time Gospel Hour.
Since early December, at least five contractors have filed liens against Liberty Village, with claims ranging from several thousand to close to a million dollars. Best Grading, owned by Lewis T. Falwell, a relative of the Rev. Jerry Falwell, filed a $895,184.49 lien Jan. 16. Ed Giuffre, a Roanoke contractor whose $6,280 mechanic’s lien will be filed today, said, “We wasted days and days and weeks of our time trying to collect this money.”
Giuffre was hired to install trusses on the roofs of some of the housing units at Liberty Village. He said he has not been paid for any labor, materials or equipment for construction he did.
Jennings Works Inc., a Lynchburg landscaping contractor, filed the first lien, for $146,750.30, on Dec. 9. Owner Laurice Jennings said his company worked on Liberty Village from October 2001 until December 2002. He said he has not been paid for much of his work in second half of 2002. “Things were kind of clicking along, and all of a sudden, they just hit a brick wall,” Jennings said. Marvin T. Templeton & Sons has filed two liens against Liberty Village. Both are for money owed by a contractor that Templeton was a subcontractor for. Templeton filed a $7,000 lien to collect payment on work it did furnishing and installing asphalt for driveways as a subcontractor to SDB Construction, which owes the money to Templeton.
SDB Construction’s president Jacob Frydman is also president of Savoy Senior Housing.
Templeton also filed a $90,000 lien for pavement work done as a subcontractor to Best Grading.
Ferguson Enterprises Inc., which installed pipes, hydrants and plumbing at Liberty Village, has filed $54,196.73 in liens against Liberty Village, as a subcontractor of both SDB Construction and Best Grading. Frydman denied the validity of the liens.
“I don’t believe that there are any valid liens that have been filed, but there are liens there,” he said Tuesday.
Savoy first announced plans for Liberty Village in June 2000. Since then, a handful of homes have popped up on the bare stretch of Campbell County land. One couple has moved into one of the village’s condominiums.
Phil Webb, marketing representative in the sales office, would not comment specifically Wednesday on sales, but said, “Things are moving along pretty well, considering all the factors.”
Godwin said that other than the land sold to Savoy in 2001, no Falwell ministry was anything more than a marketer of the project.
TRBC Ministries — which Godwin said is separate from Thomas Road Baptist Church — sold 140 acres for the project at “fair market value” and entered a marketing contract with Savoy in May 2001, Godwin said. “We’ve done it as a vending agent of Savoy,” Godwin said. “We’re not involved in any of the corporation’s liabilities and responsibilities.” Liberty Broadcasting Network agreed to market the properties, and in return, “they would operate Liberty Village primarily as a Christian Retirement Community,” Godwin said.
Falwell has talked for years about including a retirement community in his plan to consolidate all of his ministries atop Candlers Mountain.
“We’ve been very much in favor of having a village nearby that would cater to 50 to 55-year-olds and upward,” Godwin said.
He said the ministries had wanted to find a developer that would agree to run the community as a Christian retirement center, as Savoy has. With that assurance, they were willing to let that developer own and operate the village.
“We have so many challenges that we are currently shouldering with the growth of the student body here (at Liberty University) and the Ericsson property, we’ve decided to focus our efforts in that direction,” Godwin said.
Thomas Road Baptist Church is scheduled to close on the Ericsson industrial facility Feb. 14. Falwell has said he plans to move the church and Lynchburg Christian Academy into that building.
From the beginning, Falwell has attached his name to the Liberty Village. He spoke during a presentation about it to the Campbell County Board of Supervisors in June 2000, saying “The ministries would provide the land, they’re a limited partner.”
Apparently, that name recognition helped get contractors involved. “We took on the job because of Falwell being part of it, figuring he had to have picked someone who was responsible,” Giuffre said. Liberty Broadcasting Network has marketed Liberty Village primarily through a set of television advertisements that have been running Sunday mornings on Falwell’s Old Time Gospel Hour. Godwin said the ads were producing up to 200 leads a week for Liberty Village. However, “because of the construction delays, they were unable to take advantage of them.” So about four weeks ago, the ads were paused, until a new one began running last Sunday. Godwin said that ad will continue to run, and “we are going to live up to our part of the bargain. We’re optimistic that problems that have been encountered will be solved and that the project will go forward and in due time will be completed.”