Realtor believes business deal robbed taxpayers of money
VANCOUVER, Wash. - A slick business deal over a piece of property may have cost taxpayers and a Vancouver religious group hundreds of thousands of dollars.
The property is in Vancouver, the site of the Sikh temple that burned to the ground a year ago.
Five years ago, the owner of the property, Ronald Feik, advertised the land and building, the former Landover Athletic Club, for $899,000. The Sikh community in Vancouver was looking for a place to build a new temple and thought the property would work.
"It's a wooded area, it's serene," said Brad Anderson, the realtor for the Sikh community. "It's in a neighborhood, not in a business area."
The Sikhs agreed to buy. What they did not know was that Feik had made another deal on the side.
Just before the scheduled sale, Feik sold the property to someone else, Rapid Funding Group of Wilsonville, with RFG's Randy Rugg acting as representative, for $450,000.
Rugg and Rapid Funding then turned around and sold it to the Sikhs for $835,000. It happened quickly and the deals were recorded with the county all on the same day.
Anderson thinks the deal was not fair to the Sikh community, but that's not what is eating away at him years after the transactions. He believes there was another layer. "That was paid for by tax money, you and I," Anderson said.
Anderson said Feik originally bought the property with a Small Business Administration-backed loan, which meant taxpayers guaranteed they would pay if things went wrong.
Things did go wrong and Feik owed a lot of money on the property. He made a deal with the bank to sell the property "short," for a lot less than he owed. So taxpayers did have to bail him out.
But Anderson said, instead of selling the property directly to the Sikhs for the higher price they were willing to pay, $835,000, Feik sold it to Rugg for the lower price, $450,000.
In the end, taxpayers had to pay more, the Sikhs had to pay more, and Feik's cohort walked away with hundreds of thousands in profit.
Anderson sees it as a heist of taxpayer money.
"They didn't use a .357, they used a pen. But it doesn't make it any less despicable in my opinion," he said. "They still took money that didn't belong to them."
To make matters even worse for the Sikh group, the temple was destroyed by a fire in 2012. It caught fire while under renovation just months before it was set to reopen.
Looking for answers
Feik has since moved to Idaho. He did not return our many calls and emails asking for answers about this deal.
Records show that Rugg and Rapid Funding Group worked out of a building in Wilsonville. We found that Rapid Funding Group has an eventful history.
Court documents show that Rapid Funding Group made a $200,000 sugar beet seed loan in North Dakota where the seed turned out to be worthless.
They also loaned more than $1 million in a massive African oil deal that turned out to be fake.
In each case, the court questioned Rapid Funding Group's risky business practices.
It's not a surprise to Brad Anderson.
"That's how I felt, that it was out of control and I was brought into a fraud," he said. "It still bothers me."
The question is, was the Landover Athletic Club deal fraud or just business?
We found Randy Rugg at his Wilsonville office, where he works as an insurance agent.
We asked to talk to him, but he refused.
"I have no idea why you're stopping by, just know I'm busy," Rugg said.
When we started to explain why, he abruptly ended the conversation and shut his office door.
After many phone calls to his office, he finally offered an explanation. He said that he and his business did nothing wrong or illegal in the Landover Athletic Club sale, and that his job was to make a profit and get the best deal possible. He added that he did not know what Feik did in his agreements with the Sikh community.
Anderson, the Sikh community realtor, said the FBI has questioned him and subpoenaed records to investigate this deal. When we contacted the FBI, the spokesperson said they do not comment on investigations.
The Portland Small Business Administration office, which covers the Vancouver area as well, has just re-opened after the government shutdown. The office is currently working on providing information on how much money the taxpayers paid for the short sale.
If you have an issue you'd like us to look into, Kerry and the rest of our Problem Solvers would love to help. You can contact them by emailing email@example.com or by calling 503-736-3415.