Money for her stolen home

  • Article by: JAMES ELI SHIFFER , Star Tribune
  • Updated: December 21, 2009 - 10:44 AM

An 87-year-old's compensation from the state's real estate recovery fund is the largest payout in 13 years.

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Telsche Paulson

Photo: Jim Gehrz, Star Tribune

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An 87-year-old woman who was cheated out of her home of 50 years will receive $116,972 from the state, the largest pay-out in recent memory from a fund for victims of unscrupulous real estate professionals.

Telsche Paulson's compensation from the Real Estate Education, Research and Recovery Fund was approved Wednesday by Hennepin County District Judge Susan Burke after Paulson's lawyers and the state Department of Commerce reached an agreement on her claim.

The ruling is a milestone in Paulson's long and frustrating legal journey, at a time of life that she expected to spend in comfortable retirement.

"I was happy that they decided to come through for me," she said Thursday.

But the loss still hurts. She now lives with her son in a rented house in Farmington, far from the south Minneapolis duplex she lived in from 1958 to 2008. "This house isn't like mine,'' Paulson said. "It's different."

In spring 2004, Paulson was struggling to make the mortgage payments on her home at 4231 Pleasant Av. S. when a letter arrived promising help. She took up the offer of a foreclosure "rescue," only to find out three years later that her home actually had been sold twice in a scheme orchestrated by the real estate company's owner, Timothy Lynn Beliveau.

Paulson was forced to move out of the duplex in September 2008, despite the efforts of a team of lawyers working pro bono on her behalf. Since then, she has seen the wheels of justice move.

In December 2008, a federal judge ruled that Beliveau's wife at the time, Shelley Lee Milless, used her real estate license to take away Paulson's title to her house, steal $104,872.65 of her equity and another $12,100 in what Paulson thought were mortgage payments, according to court records.

The proceeds helped support a lavish lifestyle for Beliveau, of Mound, and Milless, of Chaska, including a second home in Marco Island, Fla. and a 35-foot boat.

Beliveau was indicted in October on 12 counts, including conspiracy, mail fraud and tax evasion, that federal prosecutors say involved a real estate fraud scheme that swindled 14 investors and their lenders out of more than $2.5 million. Milless faces up to five years in prison after pleading guilty in federal court last month to scheming with Beliveau to pocket $900,000 from his mortgage brokerage company that should have gone to the IRS.

The couple have since divorced and seen their cars and homes repossessed. With little hope of collecting money from them, Paulson turned to the real estate recovery fund. The fund gets its money from a fee assessed to licensed real estate professionals in Minnesota. It's designed to compensate victims of "fraudulent, deceptive or dishonest practices, or conversion of trust funds" perpetrated by licensed real estate brokers, salespeople or closing agents.

The compensation of Paulson is the largest from the fund in at least 13 years, according to Commerce Department spokeswoman Nicole Garrison-Sprenger. The order requires the money to be paid by July 2010.

Paulson said she is prepared to testify against Beliveau if necessary.

"I'm just anxious to find out what he's going to get out of it," she said.

But Paulson is mostly trying to put the sad episode of her stolen home behind her.

"At my age, I just have to start over again," she said.

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