Douglas Elliman agent allegedly created scheme to pocket commission advances: lawsuit

One Thousand Museum and Porsche Designer Tower (Porsche)

A South Florida real estate agent has found himself at the center of yet another lawsuit. This time, a commission advance company is alleging Dedric Copeland conned the firm out of advances totaling $420,000 by bringing fake buyers to the company, including the rapper Shaggy and a wealthy Texas oil tycoon with ties to the Saudi royal family.

Residential Advance, which advances agents commissions by charging a fee, is suing Copeland, a Douglas Elliman agent, Elliman, and others allegedly involved in his scam, according to a lawsuit filed in Miami-Dade County Circuit Court in late May.

Copeland has been sued at least four times before. In May 2018, the sellers of an Acqualina condo alleged that Copeland, a co-listing agent on their property, pocketed money that was supposed to be used for a renovation, and brought a fake buyer who ultimately did not close on the unit. Elliman was also named in that suit, which is still open, according to Broward County court records. In three other lawsuits filed in Miami-Dade and Broward, judgments dating back to 2008 for more than $2.6 million were entered against Copeland.

The latest lawsuit alleges that CRMG Services LLC, a brokerage Copeland was allegedly tied to, and Elliman “either knew what was transpiring and did nothing, or were so grossly negligent in their supervision of Copeland that they should likewise be held liable for the damage suffered by [Residential Advance].”

Copeland could not immediately be reached for comment, and has no social media presence, which is uncommon for an agent. Douglas Elliman declined to comment, citing a company policy of not commenting on pending litigation.

Commission advance companies operate similarly to payday loan businesses. An agent with a deal under contract sells the right to collect the commission to a third party in exchange for the cash up front. If one deal falls through, a broker can roll the obligation over to another pending deal.

Firms like Residential Advance rely on escrow and title companies to confirm information provided by agents and brokers, according to the lawsuit.

Peter Zalewski, a condo market consultant and investor in Miami, said that in this case, “the company taking the risk is the one getting screwed” and a lawsuit like this calls into question the company’s policies.

The alleged scam with Residential Advance began in March 2018, and ended in February of this year. According to the suit, Copeland applied for a $50,000 commission advance two years ago on the sale of two luxury condos, units 2905 and 1901 at Porsche Design Tower in Sunny Isles Beach, which were under contract to Faith and Tom Wright. The condo tower is home to celebrities such as soccer superstar Lionel Messi.

The players

In addition to suing Copeland, the main perpetrator of the alleged con, and Elliman, the brokerage where Copeland hangs his license, Residential Advance’s suit cites the now-shuttered Dickason Law Group, CRMG Services LLC, John Copeland, Zoraida Rodriguez, Ouafaa Guessous Wright, Dorothy Delima-Copeland, Sherry Qui-Copeland, and Dominique Josette Copeland. Residential Advance is suing all of them for breach of contract, fraud, civil conspiracy, breach of fiduciary duty, violating the Florida Deceptive and Unfair Trade Practices Act, violating Florida’s Civil RICO Act, unjust enrichment, negligent supervision, and fraudulent transfers.

Rodriguez was the escrow officer working under the supervision of Dickason Law Firm. The other Copelands mentioned in the suit – Dedric’s ex-wife, wife and daughter – allegedly benefited from the scheme by the transfer of funds.

The contracts

According to the suit, Stuart Clapick, manager of Residential Advance, was concerned over delays regarding closing dates for the Porsche Design Tower units, and reached out to Copeland and Rodriguez, who said the sales were held up due to construction delays. By August 2018, Copeland requested another $50,000 advance, telling Clapick that the closings would be “imminent,” something that Rodriguez echoed, the suit states. To get that advance, Copeland had to pledge commissions from other pending deals, including alleged sales at One Thousand Museum and The Mansions at Acqualina, which he did, for a total of six sales, the suit states. (Clapick did not respond to requests for comment.)

Meanwhile, Copeland said he was working under the brokerage firm CRMG, according to the suit, even though he was still an Elliman agent. State records show he’s been an Elliman agent since 2015, except for a period of two weeks in April 2019 when his license was inactive.

In March 2019, Copeland introduced Clapick to Faith Wright, a buyer of the two Porsche Design Tower units, “as a way to drag Clapick and RA deeper into his fraudulent schemes,” the lawsuit alleges.

Copeland represented Wright as a wealthy person whose family was part of the extended Saudi Royal family with $100 million to spend on real estate in the U.S., according to the suit.

In April and June 2019, the seller of a unit at Acqualina canceled their contract with a buyer that was brought by Copeland. At the same time, Copeland said another of his buyers, who never materialized, was Orville Richard Burrell, a.k.a Shaggy, for a unit at Faena House, an ultra luxury oceanfront building in Mid-Miami Beach, according to the suit.

“In fact, there was no actual buyer, and upon information and belief, Copeland forged Burrell’s signature on the Faena House contract,” the lawsuit states. The unit wasn’t even for sale.

From commissions on luxury condos to a plan to invest $100M

As the alleged fraud continued, Copeland arranged meetings with Clapick and Wright. Copeland and Wright, who were reportedly “best friends,” proposed a plan to acquire and resell residential investment properties in the U.S., using a $100 million contribution from Wright, and her access to as much as $2 billion through the Saudi royal family, according to the lawsuit. They met to create Wright Capital Partners LLC, a Delaware company.

Though Clapick paid a $5,000 fee to Dallas lawyer Charles Haag of Winston and Strawn, the firm required a $125,000 retainer, which Wright was supposed to provide but never did, the lawsuit alleges. Wright even allegedly traveled to Italy to see her “very ill” mother, continuing to provide excuses as to why the money hadn’t materialized.

All the while, Copeland continued to score advances from Residential Advance, including $30,000 for money owed to his ex-wife for alimony, and money to his current wife for “family expenses,” according to the lawsuit.

The contracts never closed, despite Rodriguez, the title agent, confirming to Residential Advance that they had closed. Earlier this year, Clapick discovered that the deals were fake, and Wright’s story was a sham, the lawsuit alleges. Wright had filed for bankruptcy in 2017 under her real name, Ouafaa Guessous Wright. Wright allegedly came clean to Clapick, and said none of the deals at Porsche Design Tower or One Thousand Museum had been under contract, according to the suit.

Clapick also discovered that the law firm Copeland had used, where Rodriguez was reportedly employed, had been closed and was facing lawsuits for allegedly mishandling escrow funds, the lawsuit states.

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from The Real Deal Miami & Miami Florida Real Estate & Housing News | & Curbed Miami - All https://therealdeal.com/miami/2020/06/17/douglas-elliman-agent-allegedly-created-scheme-to-pocket-commission-advances-lawsuit/
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