Too Big to go to Jail - The Lennar Story (a video documentary)

And the 4/13/10 press release for "Top 10 Red Flags for Fraud: The Sequel"

By Dawn Wotapka, The Wall Street Journal, 3/31/10
http://blogs.wsj.com/developments/2010/03/31/movie-of-the-week-the-lennar-story/

In his latest salvo against builder Lennar Corp., controversial gadfly Barry Minkow has gone Hollywood.

Mr. Minkow’s Fraud Discovery Institute Inc. just released a trailer for “Too Big to go to Jail: The Lennar Story,” a drama that seems worthy of a Lifetime movie. The film promises to show “a disturbing pattern of apparent fraudulent behavior . . .ranging from the falsification of government documents to the utilization of their joint ventures to conceal debt and siphon cash from unwitting joint venture partners.”

The 70-minute show, Mr. Minkow promises, is professional quality and “not done cheesy with my father’s rent-a-camera.” It will initially be released in a handful of theaters in and around the three “communities most devastated by Lennar”: Hunters Point in San Francisco, El Toro in Irvine, Calif., and Hutto in Texas.

The Trailer:	QuickTime format	Windows Media format
Bonus Footage:	QuickTime format	Windows Media format

  Trailer & bonus footage comes in two formats (QuickTime & Windows Media) that
  may require the installation of a plug-in. The trailer features Sandee Bradshaw
  who purchased her home from Lennar and describes a meeting with Lennar Texas
  President Sean Chandler. Chandler allegedly admits to Lennar's falsification of an
  official HUD document saying the soil is neither expansive nor contaminated when
  evidence shows it is both. The bonus also includes interviews with HOT President
  Tom Archer.

Mr. Minkow says he’s in discussions for a cable special that could air this summer. He didn’t reveal the specific networks.

Mr. Minkow’s life could even make for a movie: After serving a seven-year jail sentence for securities fraud, he vowed to smoke out corporate misdeeds upon his 1995 release. He also says he always sells short, meaning he profits from stock declines, any company he is reporting on.

Miami-based Lennar, which declined to comment on its movie-star status, has previously denied the accusations. Early last year, Mr. Minkow’s campaign caused a 20% plunge in Lennar’s shares. The company, one of the nation’s largest builders, took the unusual step of issuing a release on the matter. Lennar sued Mr. Minkow, accusing him of libel and extortion in spreading “false and scurrilous” claims.

“When you get sued you know you are right,” he told the Journal at the time. “We are just getting started.” Looks like he keeps his word.

“Once upon a time there was LENN-RON” is a whistle-blower document that Minkow published a few years ago to encourage public officials to investigate the company. It gives an early preview of what you can expect in this documentary. Another preview came in a January 2009 Youtube video where Minkow described Lennar as a "financial crime in progress."

Lennar Corp Top 10 Red Flags For Fraud: The Sequel

Investigation includes claims from bankrupt joint-venture partners, misleading financial statements, thousands of unpaid subcontractors and 2 Fs and a D- minus from Better Business Bureau - Special Bonus footage of the Fraud Discovery Institute

For Immediate Release

SAN DIEGO | April 13, 2010 --- The Fraud Discovery Institute, Inc. (FDI) today released a devastating report that details how Lennar Corporation (NYSE: LEN) has:

• Bankrupted joint-venture partners
• Stiffed thousands of subcontractors
• Borrowed money at high interest rates to apparently fund a lawsuit
• Received F grades from Better Business Bureaus
• Received a sizeable payout from a land deal that eventually lost $1.2B for the California state workers' pension fund
• Filed misleading financial disclosure statements
• Been accused repeatedly of double dealing, extortion and fraud

In conjunction with "Lennar's Top 10 Red Flags for Fraud: The Sequel" report, the Fraud Discovery Institute also unveiled today over 10 minutes of its upcoming documentary, "Too Big to Go to Jail: The Lennar Story." The movie documents the alleged nationwide pattern of fraudulent behavior by Lennar, one of the nation's largest homebuilders.

In the released clip, residents of San Francisco's Bayview Hunters Point, home to the largest African-American population in the city, angrily accuse Lennar of breaking its promise to monitor the community's health risks while developing a nearby toxic site, and of reducing the number of affordable units it originally proposed. [HOT: Bonus footage features homes in Hutto, Texas that were built on expansive and contaminated soil and where the company submitted fraudulent HUD forms.]

"Top 10 Red Flags for Fraud: The Sequel" includes:

• An analysis of Lennar's 2009 fourth quarter financial filing that shows the company's performance was far from an "improvement," as Lennar stated to the SEC and Wall Street
• Allegations of fraud made by three of Lennar's former joint-venture partners
• News that one Lennar project left 5,000 subcontractors in its wake and another development was encumbered by nearly $6 million in mechanic's liens
• Homeowner claims that Lennar knowingly built a development on unstable land and then tried to blame its subcontractors for the resulting damage
• Details of a high-interest $400 million loan Lennar took out apparently to fund litigation

According to FDI, the most disturbing fact contained in the new report is the now unearthed and clear pattern of behavior utilized by Lennar to gain an unfair advantage over various joint venture partners. This specific tactic was utilized in multiple joint venture projects including the now infamous LandSource CalPERS joint venture; the Palm Springs joint venture; and the Paradise Palms joint venture in Florida; and, through the utilization of a variation on this theme, even the San Diego joint venture. In essence, the evidence appears to show that Lennar creates various entities for joint venture projects, allows them to go bankrupt or default, and then uses a deep pocket parent entity, Lennar Corporation, to repurchase assets - including in some cases loan notes from these failed projects - at a severely discounted rate.

The evidence appears to show that, in many instances, Lennar intentionally allowed failure of these projects for the sole purpose of repurchasing them at a discount, to the detriment of joint venture projects.

"One question comes to mind after considering this evidence. Where is Lennar's independent Board and Audit committees during all this?" asked Barry Minkow, co-founder of the Fraud Discovery Institute Inc. "How does a Board - any Board of a public company in a post-Enron, Sarbanes-Oxley environment - allow the senior management of this company to run rampant?"

"The 'Top 10 Red Flags for Fraud: The Sequel' and clip from the documentary show a clear and persistent pattern of how Lennar uses fraud and broken promises as regular business tools," said Minkow. "Look at the public documents that back up our findings, and you'll ask yourself the same question we did: how does the company keep getting away with these activities?"

Minkow said his investigations into Lennar (the original "Lennar's Top 10 Red Flags for Fraud" was released in Jan. 2009) reveal that the corporate giant uses its deep pockets and the slow-moving legal system to outlast any joint-venture partner or subcontractor who files suit to collect money owed by Lennar.

In fact, after Minkow's first "Top 10 Red Flags" was released, Lennar brought suit against him.

"No one - not even an ex-con - enjoys being sued," added Minkow. "Sometimes there is a cost associated with muckraking, and that is a cost we have been willing to pay as long as the truth about Lennar's business dealings comes out."

The Fraud Discovery Institute Inc. set out to avoid two things in this new report. The first was to avoid repeating evidence of misconduct contained in the first report, and second to avoid focusing, other than by inference or indirectly, on the litigation surrounding how FDI initially became involved in the Lennar case.

Finally, Minkow also announced the creation of his point-by-point refutation of claims Lennar made in a Florida courtroom that he has manufactured evidence in the Lennar suit against him - and forwarded it to various law enforcement agencies.

More information is available by phone at 1-888-300-8307 or by e-mailing info@frauddiscovery.net. Information about the Fraud Discovery Institute and its work is available at FraudDiscovery.net (http://www.frauddiscovery.net) and at Lenn-ron.com (http://www.lenn-ron.com).

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CONTACT:

Barry Minkow
FDI
9747 Businesspark Ave #218
San Diego, CA 92131
PHONE. 888-300-8307

4/17/10: Lennar: a Corporate Sleaze is strange endorsement of the Fraud Discovery Institute video documentary of Lennar Corporation, which is portrayed as "a financial crime in progress." If "It takes one to know one," Sam Antar knows white collar crime. He is a convicted fellon that now teaches law enforcement, government entities, professionals, businesses, and students about white collar crime and trains them to catch corporate villains.