A Tampa business owner with connections with Hermes heirs

Tampa – Four years ago, low-income residents of mostly black and Hispanic neighborhoods near Bush Gardens, journalists knocked on their doors and owned partially by the Hermes family, where their rental homes are super rich. I was surprised when I told them that it was happening. A luxury fashion empire thousands of miles away.

Now, the investment companies behind those rental homes and their founders have signed a settlement with the U.S. Department of Justice on allegations that they intentionally committed fraud in order to obtain payroll protection program loans.

That’s because the company’s whistleblowers and former partners are working with the government and are trying to eradicate what he says is greedy. work.

Thibault Adrien and Lafayette Re Management LLC, the company he founded, have agreed to pay the government $680,000. The following year, the loan was allowed. The property management company has not been named in the settlement.

But former partner Jesus Nunez Anda says it’s not about the amount of dollars.

“Even if the theft here is less than $1 million, it’s a cascade effect for people in Florida because it affects their homes,” he said in an interview. According to court records, Nunez-Unda has been working for the company for about two years and has completed an application for a government relief loan as part of his duties.

Government support in Lafayette came as the company was raising rents in Tampa, Fort Lauderdale and other major markets in the South, court records show.

Under the terms of the settlement, Lafayette did not accept liability. The company claims it is eligible to receive the loan.

“In order to avoid long-term lawsuits and employ legal costs that were beyond the amount of the loan, Lafayette, like many others, will settle with the Department of Justice without acknowledging liability or misconduct. “We chose to resolve the issue with,” the company said in a statement.

The company also said the whistleblower complaint that led to the settlement was filed by a disgruntled former employee leading the PPP loan application and forgiveness process, believing that Lafayette is UNDA’s personal Vendetta. He said it reflects what he is doing: an individual who fired Anda’s employment.”

House as a corporate asset

Four years ago, the Tampa Bay Times and the Miami Herald revealed the Hermes family’s stock in more than 1,000 rental homes in Florida, which were publicly available thanks to new transparent laws in Luxembourg. The small European nations were heaven for the very wealthy to hide their wealth due to favorable tax and confidentiality.

However, the new law, in collaboration with reporters from French newspaper Le Monde, is a way for an international group of journalists to see how wealthy people don’t look like everyday people, despite the investment touching on their sides. allowed us to reveal how it will move the world. They live like the house they live in.

Records cache lists three heirs of Hermes Fortune, Julie Guerraland, Blaze Guerraland and Eduard Guerraland as beneficial owners of Luxembourg Holding Company, which is under the umbrella of Lafayette Real Estate. It was done. The company used funds provided by investors like Hermes heirs to buy the home, but created other small companies to make the purchase of them. I started buying houses after the Great Recession. It was a large portion of the foreclosed homes sold to investors for pennies in dollars, and the company’s homeownership began to be held nationwide.

The frizzy charm of the French fashion brand contrasts with the modest homes they own in Tampa, many of which offer around 1,000 square feet, with chain link fences lined up front yards.

On the Hermès website, customers can browse luxury items such as a $1,025 men’s belt and a $910 Chihuahua-sized raincoat (at the cost of a larger dog). The company’s signature Birkin handbags have gone beyond the value of many homes in the Lafayette real estate portfolio, reaching hundreds of thousands of people at auction.

The Hermes family downplayed their involvement with real estate companies when they asked earlier from the Tampa Bay Times and the Miami Herald. Lafayette told reporters that with the approval of the family, the heirs’ shares reached less than 3% of the company’s assets.

A whistleblower complaint against the company recently sealed in federal court reveals that Eduard Guerland was on the advisory board of one of the real estate funds used to purchase the home. And another filing by Nunez Anda in the related New York lawsuit tells Hermes heirs and other members of the fund’s board of directors about Lafayette’s erroneous allegations before the federal government was involved. It showed that this was.

Representatives of the Hermes family did not respond to emails requesting comment. A statement from Lafayette said none of the fund’s advisory board members were “involved” in the operation of the government and the company that settled.

A legal battle is underway between a real estate company and its former employees. Nunez Anda’s lawsuit in New York alleges that the company owes him the money. Nunez-unda is entitled to approximately $130,000 of the settlement Lafayette paid to the US government. This is a typical arrangement in a whistleblower case.

A statement from Lafayette shortly after the settlement suggested a more likely legal action, and believed that “Nunezu Anda is also involved in honor losses,” and the company and its founders said, ” “We will fully enforce their rights in this respect.”

But as these fights continue, the resulting court records provide insight into how the company’s landowner industry works.

Nunez-Unda said Lafayette is targeting specific demographics of its customer base.

“Through the data, they’re like a complete calibration. “OK, our niche is a firefighter who married an elementary school teacher.

Business buying of homes across the country has sparked criticism among affordable housing advocates who say businesses are boxing people regularly from homeownership in their neighborhoods. That’s because they are armed with benefits like Wall Street connectivity and large bank accounts, which can make competition difficult for regular buyers. This week, Republican state lawmakers introduced the bill, citing concerns about rising costs for Wall Street-backed landlords who have difficulty buying Florida homes.

Lafayette responds to criticism of the industry by providing affordable, high-quality rental homes, including those who cannot buy, to meet important needs in underserved communities.

“The fact that home ownership is much more expensive than rental is the reality that Lafayette doesn’t make or control,” the company said.

Lafayette also expanded into the construction industry in the rental industry, building homes to buy and lease empty land. In November, the company announced its 15th build contract in a year, purchasing a strip of land in Newport Richie.

More than a third of Lafayette’s homes are located in Florida, with 17% concentrated in the Tampa market.

More ammunition

Although research into inappropriate pay protection program loans has become almost common, it is estimated that 70,000 of the more than 11 million generous small business loans were fraudulent.

To get a loan, Lafayette has to prove that ongoing economic uncertainty can threaten its business, and the company uses its money to float.

But proving that the company has taken away loans it doesn’t actually require is not an easy task, said Derek Adams, a former federal prosecutor who has extensively tracked down the pandemic loan fraud case. He said the incident is rare in a way that revolves around a dispute over the company’s economic needs.

“It’s about the way the organization thinks and intentions,” Adams said.

In a federal complaint filed by Nunez-Unda, he alleges that CEO Adrien has admitted in writing that even if he applies for government assistance, the pandemic is likely to help more than hurt the business. .

A few days after Lafayette applied for a pandemic relief loan, court records show that Adrian, a French-American, sent an email to officials from other companies expressing bullishness about the detached home rental sector. Masu. Adrian also discussed the “opportunity” to invest in stocks in invitation homes, one of Lafayette’s competitors, the complaint said.

After Lafayette receives government loans, the company filed an offer to acquire the national mortgage lending company, paying more than $1 million in legal and financing fees in the process, Nunez-unda claims did. Also, in 2020, the business’s real estate management department opened four offices, according to complaints.

The company argues that the loans were used only for allowable costs, and subsequent investments came after a better read about the financial environment. The company is optimistic about the long-term strength of the business when applying for a generous loan, and when unemployment caused by the pandemic threatens tenants’ ability to pay rent, it is less certain about the immediate future. He said that wasn’t.

“There were serious short- and medium-term concerns,” the company said.

Court records show that the $680,000 settlement amounts to about a fifth of the $3.5 million annual revenue. That revenue figure is based on fees received by the management company and does not include all profits from other parts of the company.

Former federal prosecutor Adams said the Lafayette settlement could lead to more cases against companies suspected of receiving lenient loans that were not necessary, and other whistleblowers said the case was He said it can now be used as a model.

“It gives you a little ammunition,” he said.

Times staff photojournalist Douglas R. Clifford contributed to this report.