Seven months after buying a home on the shore of Lake Minnetonka for the bargain price of $142,000, Cristian Fisk flipped the property to someone else for $359,000.
How did Fisk manage to more than double his money on the deal? His mother was the real estate agent on both transactions, and she took “illegal” steps to drive down the price of the property, according to a lawsuit filed last month against broker Christine Valerius by the original owner of the house.
In his lawsuit, Robert C. Vandell said that Valerius — who works as a broker at Coldwell Banker Burnet’s office in Wayzata — failed to inform him in writing that Fisk is her son, a violation of state law. The Minnesota Department of Commerce is investigating Vandell’s complaint, according to Tom Rehman, a Coldwell Banker Burnet vice president.
“They requested our files, which we sent,” said Rehman, who said he couldn’t answer questions about the deal or Valerius.
In the lawsuit, Vandell accused Valerius of fraud and breach of duty. Valerius, who obtained her real estate license in 2006, did not return calls seeking comment and has yet to file an answer to the lawsuit.
Her lawyer, John Jesperson, said the lawsuit “severely misrepresents some of the factual background.”
Fisk declined to answer questions about the property. “I’m good,” Fisk said. “Nobody really reads the newspaper.”
State regulators have revoked the licenses and taken other actions against sales agents who have failed to disclose their relationships to a buyer in order to camouflage their interest in a deal, a practice known as using a “straw man” buyer. Commerce officials did not respond to questions regarding the investigation.
Jesperson said the Vandell case isn’t like other straw-man cases that led to discipline.
“The facts are much more complicated than that,” said Jesperson, who declined to answer questions about the transaction or the relationship between Fisk and Valerius.
Valerius identified Fisk, 24, as her son in her 2013 divorce.
Vandell, according to his lawsuit, hired Valerius to help him sell his three-bedroom Mound home in 2016. Though other homes in Vandell’s neighborhood are worth $500,000 to $2 million, she listed his 2,065-square-foot property for $175,000.
Instead of listing the property on the Multiple Listing Service, a search tool that allows brokers to find possible properties for their clients, Valerius persuaded Vandell to keep the property out of public view, Vandell claims. She also failed to schedule any open houses or advertise the property, according to the lawsuit.
“That allows her to essentially fly below the radar,” said Stanford Hill, Vandell’s attorney. “It allows her to market it to the people she wants to market it to — or not at all.”
The result, Vandell claims, was the property wasn’t shown. Instead, two weeks after dropping the price of his house to $159,000, Valerius presented an offer from Fisk to buy the property for $142,000.
At the closing, Fisk was asked how he liked the home. “I don’t know, I’ve never seen it,” Fisk allegedly said, according to the lawsuit. “I trust my agent that it’s a good property.”
Fisk sold it seven months later, earning a profit of $217,000, the lawsuit says.
“That should have been Robert’s money,” Hill said.