Ex-broker admits role in Cloud 9 condo fraud

A former real estate agent and broker has admitted that she participated in a multimillion-dollar mortgage fraud scheme that involved a Minnetonka condominium project by St. Paul developer Jerry Trooien.

Lindsey R. Loyear, 30, of St. Paul, pleaded guilty Monday in federal court in St. Paul to conspiracy to commit mortgage fraud and faces up to five years in prison.

According to the plea agreement:

From 2006 through October of 2008, Loyear conspired in a kickback scheme that involved submitting false information to lenders to obtain mortgage loans for the Cloud 9 Sky Flats in Minnetonka.

Loyear filed for Chapter 7 bankruptcy in 2009. Her Saturn and Jaguar vehicles were repossessed.

Three other people already have pleaded guilty in the Cloud 9 scheme. One, former broker Sheri L. Delich, who pleaded guilty in June, testified that she was following instructions from Trooien, whose company converted the office building into condos during the real estate boom. Delich's lawyer said she is cooperating with investigators.

Trooien has denied Delich's courtroom accusation.

The number of condo units involved in the overall kickback arrangement has topped 100 -- at Cloud 9 and elsewhere. Kickbacks from the loan proceeds exceeded $8 million, according to federal prosecutors.

Trooien, once one of the area's more prominent commercial real estate developers, emerged from Chapter 11 bankruptcy in August. He has not been charged.

But his financial troubles are not over.

On Monday a notice published in the St. Paul Legal Ledger Capitol Report said that a glassy, eight-story St. Paul office building owned by one of Trooien's companies is scheduled for a foreclosure auction on Jan. 24. That building, known as River Park Plaza, was also Trooien's headquarters.

Comcast is a tenant in the 333,000-square-foot building, which is along the west bank of the Mississippi River with views of downtown St. Paul. It's one of several properties owned by entities controlled by Trooien that have already headed toward foreclosure.