A Seattle Times Investigation
Part One | The fleecing of Frances Taylor
Seattle Times staff reporter
DEAN RUTZ / THE SEATTLE TIMES
DEAN RUTZ / THE SEATTLE TIMES
DEAN RUTZ / THE SEATTLE TIMES
DEAN RUTZ / THE SEATTLE TIMES
COURTNEY BLETHEN / THE SEATTLE TIMES
TOM REESE / THE SEATTLE TIMES
Help for identifying or reporting elder abuse:Seattle Police Department: 206-625-5011.
Police also recommend you call Adult Protective Services. If urgent help is needed, call 911.
Adult Protective Services in King County:
206-341-7660 or 1-866-221-4909.
Other county APS offices: http://
Aging & Disability Services Administration lists signs of elder abuse and suggestions for preventing it. www.aasa.dshs.wa.gov/
Source: Seattle Times research
Seven years ago, Frances Joy Taylor was living in her own house, singing in her church choir and baking apple pies for friends. The 89-year-old widow had about $2 million in assets — which she intended to leave to her church to help children in Africa.
Today, Frances lives at an adult-care home and spends her days napping in front of a television. Her care is paid for largely by taxpayers, because Frances is now bankrupt. Frances' memory is fading as fast as winter daylight, the result of a steady assault by Alzheimer's over the past eight years. Her financial demise began around the same time, when a businessman named Tyrone Dash took over her affairs.
Acting on what he says was Frances' behalf, Dash methodically liquidated or leveraged almost everything she owned: her bank accounts and securities, her insurance policies, her credit cards, her two apartment buildings and, ultimately, her home.
What didn't end up in Dash's pocket went to others: Contractors who worked on her apartments. A lawyer who rewrote her will. A business group that bought one of her properties at a bargain price.
And tens of thousands went to financial institutions: credit-card companies, mortgage lenders and others that were more than willing to extend credit, assess large fees for questionable transactions and, in one case, violate their own rules to sell Frances high-cost loans she had no hope of repaying.
The companies that fed off her decline are part of a financial-services industry that targets people, looking for potential borrowers with high debt and assets that can be tapped to pay off that debt.
Frances was an easy target for someone wanting to separate her from her money. And as she slid into debt, she was an even better target for eager lenders who knew what she owned, what she owed, and how fast her nest egg was disappearing.
Along the way, some people raised concerns about what they saw happening to Frances and her money.
Officials are now investigating filing criminal charges against Dash.
Some of Frances' lenders will be in court soon, too, waiting in line for the proceeds of her bankruptcy.
Two and a half years ago, during a quiet birthday celebration for Frances, her longtime friends Paul Robert "Bob" Forgrave Jr. and his wife, Kathy, asked her about her apartments. Frances furrowed her brow: "I'll have to ask Tyrone."
"What do you need to ask Tyrone?" Kathy asked, puzzled.
"Whether the apartments sold," Frances replied. "First they did, and then they didn't. I don't know anymore."
The Forgraves peppered Frances with questions about Dash, a business consultant and tax preparer she'd met in 2000. Vague answers followed.
The next day, Kathy Forgrave checked Frances' properties on King County's Web site. Both apartment buildings had been sold. Frances' house was in foreclosure, set to be auctioned off in 11 days.
Bob Forgrave drove to Frances' home with the news. She seemed shocked and confused.
The next day, he searched her papers. He found Dash's name on her accounts, on life insurance, mortgage correspondence, and on her checks.
He filed a police report, changed Frances' locks, installed a video camera and waited. Dash showed up later that day, and Forgrave met him on the driveway.
"Nice to put the face to the crime," he said as he shook Dash's hand.
"What do you mean?" Dash asked.
"Buddy," Forgrave said, "you left a paper trail a mile wide."
Forgrave hired a lawyer to file Chapter 13 bankruptcy for Frances and stave off foreclosure. His kitchen became a command center as he and his wife assembled the pieces of Frances' financial collapse.
After two years of work, Forgrave is clear on one thing: The man alleged to have fleeced Frances had plenty of help.
A history of thrift
Frances was a frugal woman. She kept track of her weekly $1.50 donations to her church. She reused construction nails and pulled clothes from other people's garbage to wash and give to charity. For decades, she had just one credit card — a charge plate the Bon Marché issued in 1969.
Frances' thrift was born of faith and experience: During the Great Depression, she saw her family lose its Montana farm; and while attending nursing school, she ministered to the homeless on Spokane's streets.
There, she met and married Sterling Taylor, an attorney and polio survivor who was an advocate for people with disabilities. The couple moved to Seattle in the 1940s, helped establish the Green Lake Church of Seventh-day Adventists, and developed two apartment buildings on Capitol Hill. They eventually settled in a house they built in the Northgate area.
They had no children. And when Sterling died in 1972, Frances assumed management of the 13 apartments. She kept rents low, but the income helped support her for 30 years. Her only extravagances: traveling with her church and her sister Jennie, and giving to charity.
Over the years Frances described her trips and her busy life in daily journals. But as her Alzheimer's progressed in late 1999, her entries grew perfunctory, with notes about the weather, sports scores or the occasional visitor: "Snow in passes — washed my hair — very quiet day."
Fellow congregants noticed that her apple pies — popular at the potlucks after services — were missing ingredients. She showered infrequently, and choir members edged away from her during rehearsals. She had several fender benders but refused her friends' pleas to stop driving. She tersely answered questions rather than admit to memory gaps.
Today, Frances doesn't remember the businessman who spent much of her money, and she doesn't recall that she lost her home to debt.
"I don't believe in being in debt," she said in an interview. "If you have it, use it wisely, or you won't have it."
The drain begins
Frances first met Dash in 2000. He was working for Frances' contractor, helping him with billing and bookkeeping. The contractor was doing repairs on her apartments and needed Dash's help to get Frances a loan.
Dash, 58, is a wiry man with a broad smile and a disarming chuckle. But he prickles easily, especially regarding race.
"You know people make certain impressions about the way you look," said Dash, who is African American. "It's always, 'Oh, you're so articulate,' meaning I sound white, or I'm just a smooth-talking con man. I've been through all that."
The contractor, Abel Cordova, had worked for Frances for 15 years. In 1999, he had started renovating her properties. The work grew increasingly ambitious: redoing plumbing and electrical systems and replacing carpets, drapes and appliances.
At first, Frances dipped into savings and investments to help pay for the renovations. As rental income dropped off, she borrowed more than $220,000 against her home, which she had owned free and clear.
It wasn't enough, and Cordova was recommending more extensive structural repairs. He asked Dash to negotiate construction loans on Frances' behalf from Frontier Bank.
Frontier approved two loans totaling $343,000 in July and required that Frances pay Cordova $100,000 from the proceeds, Dash said. Dash came up with that figure from looking over old billings and identifying work where Cordova had undercharged or not charged Frances.
The day Frances signed the first loan she also signed Dash to a five-year contract to manage her apartments. Dash's authority quickly expanded. He hired contractors, some of them businesses he had done work for, and within six months, fired Cordova, telling Frances he'd overbilled her.
Cordova said he relied on all of Dash's representations, and after he was fired, he warned Frances about Dash. She didn't listen.
By then, Frances had taken out another $301,000 loan from Frontier and had spent more than $750,000 for work on both buildings, according to Dash's records.
She also paid Dash at least $20,000. He had charged thousands more on credit cards he obtained for her, charges he says were on her behalf.
Frances represented a new sort of client for Dash — one who paid well and on time.
Dash had owned a highway-safety company, mostly installing guardrails, in the 1980s. But he declared bankruptcy in 1990 and settled into preparing tax returns. He got a few small contracts advising government agencies on minority-owned business issues and consulted for minority- and women-owned firms.
Dash and Frances became regular lunch and dinner companions. After sharing a meal with Dash, Frances would sometimes note in her journal: "We enjoy each other."
Frances called Dash nearly every night, said Stephanie Dash, his estranged wife. When she didn't call, Dash called her. If she didn't answer, he would drive to her home to check on her.
"I wasn't taking advantage of her," Dash said, adding that he "always discussed" his charges with her. He looked after her well-being; she appreciated it and paid him accordingly, he said. But he also acknowledged that he owes her around $25,000.
Dash learned that Frances' apartments belonged to the regional governing arm of her church. But the apartments were needed as collateral for the construction loans, so he and Frances negotiated with the church corporation to move the properties back into her name. The renovations stood to increase the buildings' values, and the church corporation expected to get them back.
Don Kellogg, the church trustee who oversaw Frances' planned gifts to the Western Washington Corporation of Seventh-day Adventists, agreed to the arrangement. He thought Frances was competent and Dash seemed to be a "straight-shooting guy," he said.
The church corporation took precautions, though, getting legal authority from Frances to make decisions on her behalf.
Frances' tenants were suspicious of Dash and Cordova, and thought many of the apartment renovations were unnecessary.
Tenant Barbara Ristagno, who'd known Frances for 10 years, said Frances was confused about the work and what it cost. Ristagno and another tenant confronted Dash and Cordova in mid-2000, accusing them of taking advantage of Frances.
At least eight tenants filed complaints with the state attorney general, the state's Adult Protective Services (APS) office, Seattle police and the city planning department.
APS social worker Catherine Baker interviewed Frances in August 2000 and concluded that Frances was confused about the renovation and her finances.
Others Baker interviewed agreed, including an attorney whom Frances consulted twice that year. He said that whenever he asked Frances a question, she turned to Dash to answer for her. According to Baker's report, the attorney said he was glad Baker was investigating, because Frances "may not be fully capable of handling her affairs and may need a limited guardianship."
But a Frontier Bank executive who set up Frances' loans praised Dash for his decisions to raise rents, collect back rent and monitor construction expenses, the report said.
Baker, a city inspector and a police detective met with Frances and warned her about Dash. She told them she trusted Dash but noted the session in her journal: "Tyrone ... they say — a con artist!"
She continued as before, arranging lunches and dinners with Dash. In September, the "sheriff's office" called Frances, "warning me against Tyrone." She noted the call in her journal, then ignored it.
Before completing her investigation, Baker told Kellogg, the church corporation trustee, that she had "continuing concerns" that Frances "was being taken advantage of," according to her report. Kellogg assured her the church was taking over Frances' affairs and would ensure the renovations were completed.
Baker wrote she was "unable to determine financial exploitation" and closed her case. So did the Seattle police and the Attorney General's Office.
Kellogg, on the verge of retiring, had one last meeting with Frances. She recorded it in her journal: "Kellogg here — he is not a lawyer — threatened to take over my properties." Later that night, she had dinner with Dash, "my treat."
Kellogg said he was shocked by her depiction of a meeting he doesn't remember. "I don't operate that way, and I never have," he said. "We were trying to protect her interests from other people, including Tyrone."
By early 2001, Dash had become a fixture in Frances' life, doting on her like a son and a suitor. He slipped just as easily into her accounts.
Frances was in a cash crunch, facing onerous repayments on construction loans and credit-card debts. She still had savings, stocks and bonds, and life-insurance policies, including one with a $150,000 cash value.
Kellogg was gone, but the church corporation offered to help: It would take the apartments she intended to leave it, pay off the debts and give her $100,000 cash and at least $4,000-a-month income for life.
She responded by hiring a new lawyer, Paul Oden, a partner in the offices of Miller Nash. He began to undo her 30-year-old plan to leave everything to her church. Eventually, on the eve of Frances' 92nd birthday, Oden would execute her new will, naming Dash as her chief beneficiary and trustee.
With church officials out of the picture, Dash liquidated more assets, sometimes accompanying Frances to banks to make withdrawals.
Her longtime stockbroker questioned Frances as she cashed out her stocks and bonds: "He is quite concerned about my spending — 'who is getting it?' " she wrote in her journal.
Frances agreed to a request from Dash to charge his son's funeral on her credit card and gave him his own card on her account, he said. After that, he charged her for his time, putting on credit cards whatever he thought she owed him. Among the charges: trips to Las Vegas, dinners out, ATM withdrawals for hundreds of dollars, even a $760 diamond ring for his wife.
With Frances' signed permission, Dash began borrowing against her life-insurance policy, taking out more than $100,000 over five months.
The agent who sold her the coverage was alarmed by the loans and called Frances to warn her that she was undermining the policy. She told him she trusted Dash's decisions.
Finally, Dash told Jackson National Life Insurance of Michigan to liquidate the account. The company charged a $42,482 penalty and sent a check for what was left: $71.96.
Dash acknowledges today that he charged or collected from Frances as much as $80,000 in cash and credit in 2002 alone. The amount that year was "excessive," he said, and there was likely "no excuse" for it. But he said he earned the rest.
Frontier Bank noticed the velocity of her spending and put a hold on her accounts but lifted it after Frances vouched for Dash, Frances' guardian later said.
A US Bank representative also questioned Frances about withdrawals after she obtained $100,000 in cashier's checks made out to Dash and various creditors. Dash responded with an angry letter to the bank president, and a bank representative apologized.
On rare occasions, credit-card companies notified Frances of unusual activity, Dash said. She would tell them everything was fine.
The only other challenge to Dash came when he used Frances' Citi card to buy tires for his 1984 Thunderbird, he said. Citi initially declined the charge, and a customer-service representative told him over the phone: "You're ruining her credit."
Dash said he pushed back and was allowed to charge the tires.
Dash assumed more authority and conducted more business in Frances' stead.
In early 2001, a buyer offering $780,000 for one of her buildings was rebuffed. Then, in November, that same buyer came back, this time offering $840,000. He got no response, according to the agent who prepared the offer.
But that same month, another buyer, Patrick Hester, of Seattle, began visiting Dash at the apartments. He persuaded him to bring Frances to lunch at his house.
Frances agreed to sell to Hester, who brought the deal to one of his partners, attorney Kevin Keefe.
Keefe said he was concerned about the sale, given Frances' age, but he proceeded once he learned Frances had a lawyer. He, Dash and her lawyer, Oden, hammered out the terms of the deal and the price: $500,000. It was scarcely more than she'd spent fixing it up.
Why would Frances sell to Hester when the other offer was for $340,000 more? Dash's explanation: "She liked his cat."
Hester declined to comment.
The terms, as reflected in county records, were terrible for someone with so little cash flow. The buyers offered Frances just a fifth of the sales price in cash and she financed the rest, charging the buyers 4.5 percent interest, well below commercial rates at that time, the records show.
Oden says the rate was actually 8 percent, with more cash upfront, but records showing that weren't filed with the county. A copy he provided to Forgrave said the original had been lost or destroyed. His e-mail said he didn't know there was another written offer for the building.
Oden deemed Frances "mentally competent and able to act adequately in her own interests" during the "six or seven" times he met with her over a period of two or three years.
"She lived independently, her memory was excellent and she exhibited and verbalized a sense of independence, if not orneriness," he wrote.
Hester and his partners sold the building 2 ½ years later for more than twice what they paid for it — $1.05 million.
Dash also arranged for the sale of Frances' second apartment building for $798,600. The sale of the heavily mortgaged building freed up less than $100,000, he said.
Mortgaging her future
Before she met Dash, Frances was a "prime borrower," a consumer who could borrow money on the best terms from many sources. By the summer of 2002, with mounting debt and dwindling assets, Frances was considered "subprime."
The difference became clear that summer when Dash began tapping the equity in her house, obtaining the first of three high-cost, high-interest refinances. The fees alone stripped away about $50,000 of Frances' home equity.
The first mortgage — a $217,500, 30-year, adjustable loan with World Savings Bank — included a payment option so risky 25 states outlaw it. Called negative amortization, it allowed borrowers to pay only part of their monthly interest. The rest was to be repaid later at a higher rate. The option carried less risk in markets such as Seattle where homes had appreciated.
World Savings funded the loan after it was arranged by a broker with Pacifica Mortgage. It paid him a higher commission for selling Frances a loan with a "prepayment penalty" and a higher interest rate than she otherwise qualified for. The broker, Gene Halsey, said he was trying to find a loan with the lowest payments and that Frances could have shopped around for a better deal.
"My job is to make as much money as I can within limits," Halsey said.
A year later, Frances paid the prepayment penalty of $4,350 to refinance her home again, this time with Ameriquest Mortgage, then the nation's largest private subprime lender. A 26-year-old salesman in Tukwila collected Frances' information and set up the loan. He then sent it to the company's underwriting department for approval.
The salesman, Laughton Dean Fisher, had a technical-school degree in electronics. He earned a monthly salary of $2,000 but made most of his income in commissions.
In a handwritten application, Frances' age is listed correctly, but the Ameriquest records repeatedly showed her as 30 years younger — at 62 years old. Fisher, who no longer works for Ameriquest, couldn't explain the error. He said, however, that the company forbade selling adjustable loans to anyone older than 65.
The company listed Frances' income for the previous year at $32,000 a month — treating transfers between her accounts as income.
Frances paid Ameriquest $18,000 in fees for the loan, a $297,500 adjustable-rate mortgage, in July 2003.
Nine months later, Frances applied for another refinance from Ameriquest. The timing violated a rule Ameriquest had adopted in 2000 to stop a Federal Trade Commission investigation into allegations of predatory lending. That rule required Ameriquest to wait at least two years before refinancing one of its customers' loans.
By then, Frances no longer owned any rental property, was behind on eight credit-card bills, had been late on several mortgage payments and had monthly income from Social Security of $761.
But in its paperwork, Ameriquest listed her occupation as landlord. It also used altered tax returns that whited out her business losses. Ameriquest lent her $324,000. It charged her more than $19,000 in fees and added an $8,424 penalty if she paid off the adjustable note within three years.
Diane Haugsvar of Seattle notarized the loan papers. She said she still can see Frances sitting at her dining-room table, nodding and saying "OK, OK," in a singsong voice as she signed the documents. She remembered Frances, and her house, because the situation seemed chaotic.
Haugsvar noticed clutter everywhere, and much of it seemed to belong to Dash. She remembers thinking: He's supposed to be taking care of her, yet he's making it worse.
She didn't think the situation rose to the level of a 911 call, but she now wishes she had called someone to investigate.
Frances' new mortgage payment was $2,047, nearly three times her monthly Social Security check.
She missed the first five payments, and Ameriquest filed to foreclose. Dash said he broke the news to her.
She replied, "Not my house, not my house."
Bob Forgrave, her longtime friend, took over in March 2005. He found Frances a new lawyer and became her court-appointed guardian. In May, he moved her into an adult-care facility in Lake Forest Park.
Frances' bankruptcy attorney, William Linton, tried to block Ameriquest from getting any of its funds, arguing that Frances was not competent when she signed the mortgage.
The mortgage company has declined to comment. It stopped accepting business in August and is closing. Frances' loan is now being serviced by Citi Residential Lending.
In October, Citi informed Frances her interest rate had increased again, and, with it, her payment. By year's end, it wanted her to pay $900 more a month.
But 12 days ago, a federal bankruptcy court judge approved a settlement: Frances' home will be sold for $420,000. Ameriquest gets half.
Linton may challenge claims by the other creditors but, for now, what's left after legal fees is up for grabs.
Dash also filed bankruptcy in 2005. He and his wife separated last July after he beat her unconscious, and he went to jail for 52 days on an assault conviction. Today, he lives in a one-bedroom apartment in White Center. He collects disability payments after losing sight in one eye. A King County prosecutor, in a letter, told Dash he would be criminally charged and offered him a plea bargain in October. Dash ignored him.
Dash said he was naive about his ability to help Frances. He mostly regrets that he got involved at all.
Cordova continues to work construction, and Oden is still practicing law at Miller Nash.
Frances attends church when she can and is fond of her caretaker's banana bread.
She no longer has a home of her own, but she does have a mailbox full of offers for new mortgages and credit cards.
Susan Kelleher: 206-464-2508 or firstname.lastname@example.org
Seattle Times researchers Gene Balk and David Turin contributed to this report.
Copyright © 2007 The Seattle Times Company