Eagan man pleads guilty to fraud in Cloud 9 scheme
- Article by: JANET MOORE
- Star Tribune
- June 20, 2012 - 9:07 PM
An Eagan man pleaded guilty Wednesday to a mail fraud charge that was part of a mortgage scandal at the Cloud 9 Sky Flats condo development in Minnetonka.
Joseph Steven Meyer, 47, entered his plea during a 30-minute hearing before Judge Susan Richard Nelson in U.S. District Court in St. Paul. He will be sentenced later.
Federal prosecutors alleged that Meyer and 10 others defrauded mortgage lenders of more than $14 million at Cloud 9, a former office building that was converted to condominiums by St. Paul developer Jerry Trooien at the height of the condo boom. Trooien, who exited bankruptcy last year, has not been charged.
Meyer, then vice president of Trooien's core company, JLT Group, and other real estate professionals submitted false information to lenders financing the sale of the Cloud 9 units. Buyers who applied for mortgage loans to buy units in Cloud 9 with each received a 25 to 30 percent kickback above the price reported to the lender. Then others involved in the fraud skimmed a percentage off the kickback for themselves, according to court records.
All told, more than 40 Cloud 9 units were sold through the scheme.
Meyer, who was slated to go to trial in July, was the last of the group charged to reach a plea agreement.
More than 20 of Meyer's family members and friends attended the hearing to support him, according to his attorney, Robert Sicoli.
"My client is very relieved there will be no trial," Sicoli said. "We believe this is a good resolution for everyone."
Janet Moore • 612-673-7752
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