GoWireless, Inc Verizon service provider

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Raoul Barrie Clymer14150 Grant St., Suite 33Moreno Valley, CA 92553(951) [email protected]

Propria persona

UNITED STATES DISTRICT COURTCENTRAL DISTRICT OF CALIFORNIA

RAOUL BARRIE CLYMER, : CASE NO. EDCV 11-1414-VAP (OPX)Plaintiff, :

v. ::

KEVIN ELDER, RICHARD ELDER, :SCOTT WOODSIDE, PIMLICO : OBJECTION TO KEVIN ELDERRANCH LLC, DRAKE DEVOLOP- : & GoWIRELESS, INC., MOTION MENT, LLC, GOWIRELESS, INC., : TO DISMISSALLIANCE BANK, MARK COHEN, : et al., :

Defendants. :

Comes now, Raoul Barrie Clymer, plaintiff respectfully filing his objection to Kevin

Elder and GoWireless, Inc., Motion to Dismiss and sets forth the following in support thereof:

INTRODUCTION.

Plaintiff understands why Defendants want this Court to dismiss the R.I.C.O. claims and

relinquish jurisdiction to the State Court.

FIRST REQUEST FOR JUDICIAL NOTICE OF STATE COURT DOCUMENT.

Request for Judicial Notice of an exhibit lodged in Riverside County Superior Court, case no.

TEC 10007857 & TEC 10007784. In support of a request for a restraining order K. Elder

submitted a sworn Declaration which contains the “threats and harassment“. A true and correct

copy has been attached hereto as exhibit 1.

OBJECTION TO MOTION TO DISMISS Page 1

mailto:[email protected]

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Request for Judicial Notice of page 1, paragraph 3, whichs states, “I am the sole

shareholder of a company called Pimlico Ranch LLC (“Pimlico“).

SUMMARY OF THE FACTS AND ALLEGATIONS:

Contrary to what counselor for K. Elder and Go Wireless, would contend, said

Defendants are without clean hands. This was not simply a real estate business deal gone awry.

Nor is this a simple breach of contract. The property in question is as vacant a lot as the day it

was initially presented to the Trustee of B&D. However, there is $32,600,000.00 [$32.6 million]

verifiable funds invested in the Pimlico Ranch LLC project that are unaccounted for by any of

the named Defendants.

The first time that Alliance Bank and Pimlico Ranch LLC collaborated to manipulate

investment funds, Pimlico Ranch LLC ,by and through defendant Woodside, submitted an

Application for a secured “construction loan“ in early 2004. Alliance1 granted Pimlico Ranch

LLC a $11.4 million Construction Loan [hereinafter First Loan] back on or about April 28,

2004; a year and a half before B&D became involved with Pimlico. This loan was secured by a

Construction Deed of Trust. See exhibit 2.

SECOND REQUEST FOR JUDICIAL NOTICE OF OFFICIAL RECORDS.

Plaintiff has submitted certified copies of documents filed with the Riverside County

Clerk for this Court’s perusal they are listed as exhibits 2, 3, 4, 5, and 6.

On or about October 21, 2005, Defendants procured a $3.8 million loan against Pimlico

Ranch LLC title [hereinafter Second Loan] from Diversified Builder Services. This loan was

secured by a Deed of Trust. See exhibit 3 .

On or about December 31, 2005, Defendants secured a $3.5 million loan from B&D

[hereinafter Third Loan]. This loan was secured by a Deed of Trust. See exhibit 4.

1 It is unknown at this point who represented Alliance Bank in working with defendant Woodside for the First Loan. This will be resolved by discovery.


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Again in early 2006 defendant Woodside submits another Application to Alliance Bank

on behalf of Pimlico Ranch LLC for second “Construction Loan.“ On or about May 25, 2006,

Alliance issues a “Construction Loan” for $13.9 million to Pimlico Ranch LLC [hereinafter

Fourth Loan] in the form of an unbridled line of credit. This loan was secured by a Construction

Deed of Trust. See exhibit 5.

If the First Loan was subject to the same contractual conditions as the Fourth Loan,

Alliance benefited to the tune of $2.6 million on the two Loans. The Fourth Loan established that

Alliance retained $720,238.00 in Undisbursed Interest Reserve, $386,234.00 in Undisbursed

Contingency, $174,500.00 in Loan Fees, $30,000.00 in Construction Inspection & Fund

Control Fees [Emphasis added]. This is a combined total of approximately $2.6 million in their

coffers over a two year span on two transactions collateralized by the same 30 acre bare lot.

Plaintiff posits this pattern of activity gives rise to a cause of action for RICO conspiracy.

Approximately $32,600,000.00 invested in construction of the Pimlico Ranch LLC Project and

not one piece of heavy equipment touched the soil.

Pimlico and Alliance Bank committed fraud by processing a “Construction loan” that was

a “purchase money/personal loan.” Alliance intentionally concealed the facts there was an

existing construction loan issued to Pimlico. Also, the second Alliance “construction loan”

contained a $3.8 million pay off from B&D whom subordinated to the “construction loan” as

defined in the Construction Loan Agreement.

The aforesaid actions of Pimlico and Alliance Bank defrauded the Federal Reserve Bank.

Discovery will prove that Alliance securitized the Pimlico Ranch LLC Promissory Note, which

was signed and personally guaranteed by the managing members of Pimlico Ranch LLC,

defendants K. Elder, R. Elder, and Scott Woodside, to secure the funds from the Federal Reserve


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Bank.

Of the named Defendants, only K. Elder and GoWireless, Inc., are financially thriving in

the worst economy in the History of the United States of America. On or about May 27, 2011,

K. Elder personally2 acquired a new project , Desert Vista Village, with 103 lots. The remainder

of the named defendants, Pimlico Ranch LLC Project is in default; Drake Development LLC is

inert; Mesquite LLC and Turtle Rock LLC Projects appear dormant; and Alliance Bank went

bankrupt.

It is a matter of public record that from 1995 to 2005 GoWireless, Inc. had opened

approximately 80 stores. Which averages 8 store openings per year. From 2005 to 2010

GoWireless, Inc., opened 220 more stores. Which averages 44 stores per year. More than five

times as many openings in less than half the time3. Plaintiff contends that GoWireless, Inc. is the

recipient of the laundered money. It certainly is not the Pimlico Ranch LLC project, or the

incomplete, Mesquite LLC real estate project, or the incomplete Turtle Rock LLC real estate

project.

PLAINTIFF’S STANDING.

Plaintiff is one member of a family that owns “Ben Clymer’s The Body Shop, Inc.”

[hereinafter Body Shop]. The Body Shop liquidated its real estate properties with lease back

options to finance the Pimlico Ranch LLC Project, which equates to a burden of approximately

$50,000.00 [$49,392.30] per month. Plaintiff contends that this ongoing financial burden is an

“injury to his business and property.“ This injury to Plaintiff’s business ipso facto gives Plaintiff

standing. The only requirement for RICO standing is that one be a "person injured in his business

2 All titles to 103 lots are in Kevin Elder’s personal name.3 “GoWireless, Inc., ranks no. 1617 on the 2010 Inc 5000 with three years (2006-2009) sales growth of 177%.”


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or property by reason of a violation of section 1962." 18 U.S.C. § 1964(c). And the Supreme

Court has already told us that "by reason of" incorporates a proximate cause standard, Holmes v.

Sec. Investor Prot. Corp., 503 U.S. 258, @ 265-68, (1992), which is generous enough to include

the unintended, though foreseeable, consequences of RICO predicate acts.

Notwithstanding the aforesaid, Plaintiff has acquired assignment for 100% of the Pimlico

Ranch LLC Project from the successor-in-interest to B&D Clymer Real Estate, A Trust,

including but not limited to right to chose in action. It is Plaintiff’s position that he has standing

to seek redress.

THIS COURT HAS SUBJECT MATTER JURISDICTION WITH /WITHOUT RICO:

Even if the RICO conspiracy should not survive, this Court may exercise jurisdiction

based on diversity of the parties. Diversity jurisdiction extends to "all civil actions where the

matter in controversy exceeds . . . $75,000 . . . and is between . . . [c]itizens of different States."

28 U.S.C. § 1332(a)(1). The Complaint names, Defendant, K. Elder, whom is also a resident of

Nevada and GoWireless, Inc., stating the place of incorporation and having headquarters in Las

Vegas, Nevada. The pleadings of the said complaint also state an amount in controversy

exceeding $75,000.00. A Plaintiff must set forth affirmatively not only the state by which these

corporations have been incorporated, but also the state where each of them has its principal place

of business. Brandt v. Bay City Super Market, D.C., 182 F.Supp. 937 (1960); and Cameron v.

Hodges, 127 U.S. 322, 8 S.Ct. 1154, 32 L.Ed. 132 (1888) Recently the U.S. Supreme held

“…..that the phrase "principal place of business" refers to the place where the corporation's high

level officers direct, control, and coordinate the corporation's activities.” Hertz.Corp. v. Friend,

130 S. Ct. 1181, @ 1186 (2009).

KEVIN ELDER & GOWIRELESS, INC.:


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The uncontroverted facts of the complaint aver K. Elder represented himself as the “sole

shareholder of GoWireless, Inc.”. K. Elder fraudulently stated the $3.5 million was needed to

purchase the Pimlico Ranch LLC project and property outright and that B&D would have to take

a second position on title to a “Construction loan” for the completion of the project. K. Elder

personally guaranteed , as sole shareholder of GoWireless, Inc., the successful and timely

completion of the Pimlico Ranch LLC project of which he is “sole shareholder”. K. Elder caused

$3.5 million of Pimlico Ranch LLC investment funds to be transferred into his personal account.

K. Elder mailed an interest payment check from Drake Development LLC [of which he is a

managing member and possibly sole shareholder] . It is a fact K. Elder wire transferred another

interest payment from a different unknown account [that may have been GoWireless, Inc.; only

discovery can verify which account]. All of the aforesaid constitute a pattern of racketeering

activity designed to launder the ill gotten gains thru Go Wireless, Inc.

ALTER EGO DOCTRINE:

This Court defined the “alter ego doctrine” in Nielson v. Union Bank of California, N.A. 290 F.

Supp 2d 1101 @ 1116 and stated:

“Before the doctrine may be invoked, two elements must be alleged: "First, there must be such a unity of interest and ownership between the corporation and its equitable owner that the separate personalities of the corporation and the shareholder do not in reality exist. Second, there must be an inequitable result if the acts in question are treated as those of the corporation alone." Sonora Diamond Corp. v. Superior Court, 83 Cal.App.4th 523, 526, 99 Cal.Rptr.2d 824 (2000); Mesler, supra, 39 Cal.3d at 300, 216 Cal.Rptr. 443, 702 P.2d 601 ("There is no litmus test to determine when the corporate veil will be pierced; rather the result will depend on the circumstances of each particular case. There are, nevertheless, two general requirements: `(1) that there be such unity of interest and ownership that the separate personalities of the corporation and the individual no longer exist and (2) that, if the acts are treated as those of the corporation alone, an inequitable result will follow,'" quoting Automotriz Del Golfo De California S. A. De C. V. v. Resnick, 47 Cal.2d 792, 796, 306 P.2d 1 (1957)). See also AT & T v. Compagnie Bruxelles Lambert, 94 F.3d 586, 591 (9th Cir.1996).”


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Taking the facts pled as true, Plaintiff contends that he has established that there is “such unity

of interest and ownership that the separate personalities of the corporation and the individual no

longer exist.” K. Elder, continually represents himself as “sole shareholder” of his companies

and commingles funds from said companies to his personal benefit. This Court held that “the

commingling of corporate and noncorporate assets; the diversion of assets from the corporation

to the detriment of creditors; and the failure of an individual to maintain an arm's length

relationship with the corporation… [are] factors the courts consider in determining whether the

corporate veil should be pierced …“ U.S. v. Healthwin Midtown Convalescent Hosp. 511 F.

Supp. 416, @419 (C.D. Cal. 1981)

It is a fact that K. Elder gave his “personal guarantee” as sole shareholder of GoWireless,

Inc., to procure the fourth Pimlico Ranch LLC loan [second from Alliance Bank] to secure $13.9

million line of credit. K. Elder gave his personal guarantee as the sole shareholder of

GoWireless, Inc., to B&D to secure the $3.5 million necessary for the Alliance $13.9 million

guaranteed loan.

Plaintiff believes that the :”alter ego doctrine” applies to K. Elder, GoWireless, Inc.,

Drake Development LLC, and Pimlico Ranch LLC. It would be an inequitable result to allow K.

Elder to hide behind the shell companies that he manipulates to his personal benefit.

ENTERPRISE:

The U.S. Supreme Court has held that a sole share holder and his closely held corporation

can be an “enterprise” as defined by Tile 18 USC section 1962(c). See Cedric Cushner

Promotions v. King, 533 U.S. 158, 121 S. Ct. 2087 , 150 L. Ed 2d 198 (2001) In the instant case

K. Elder is admitted sole share holder of GoWireless, Inc., and Pimlico Ranch LLC. It was K.

Elder’s representation of being sole share holder of Go Wireless, Inc., that induced the Trustee of


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B&D to invest in Pimlico Ranch LLC. It can also be inferred that it was the same representation

that Alliance Bank relied upon inasmuch as Pimlico Ranch LLC possessed a bare vacant 30 lot

which is not collateral for a $13.9 million line of credit. The facts as pled state that Pimlico

Ranch LLC investment money was directed to K. Elder’s personal account. It was K. Elder

utilizing Pimlico Ranch LLC that committed bank fraud in securing a “construction loan.”

Plaintiff contends that limited discovery of K. Elder’s personal bank account will firmly

establish whether the enterprise is K. Elder and Go Wireless, Inc., or K. Elder and Pimlico Ranch

LLC. The $3.5 million investment wired into K. Elder’s personal account will conclusively

establish who benefited by the misappropriation of those funds. The discovery of Pimlico Ranch

LLC “Construction Loan” line of credit will also establish who benefited from the fraudulent

funds.

OPERATION OR MANAGEMENT:

In Reves v. Ernst & Young, --- U.S. ----, 113 S.Ct. 1163, 122 L.Ed.2d 525 (1993), the

Supreme Court provided its interpretation of § 1962(c). The Reves Court held that the defendant

must "conduct or participate, directly or indirectly, in the conduct of such enterprises's affairs...."

The Reves Court narrowly interpreted the phrase, concluding that for liability to attach "one must

participate in the operation or management of the enterprise itself." Id. @ 1173. According to the

Court, "RICO liability is not limited to those with a formal position in the enterprise, but some

part in directing the enterprise's affairs is required." Id. @ 1170 The “operation or management”

test was created.

PREDICATE ACTS ESTABLISH K. ELDER”S OPERATION & MANAGEMENT:

K. Elder spearheaded the operation of Pimlico Ranch LLC. He personally solicited for

investment money from B&D and then personally directed B&D to make six wire transfers [six


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predicate acts of wire fraud] of the Pimlico investment funds into his personal account. It was K.

Elder that wired the interest payment [another predicate act of wire fraud] and it was K. Elder

that mailed a Drake Development LLC check for another interest payment [one predicate act of

mail fraud].

INJURY TO PLAINTIFF’S BUSINESS OR PROPERTY BY REASON OF THE ABOVE:

Plaintiff has made monthly payments of approximately $50,000.00 per month for six years for

which the immediate cause is the Pimlico Ranch LLC investment. This has severely damaged

Plaintiff’s family business as a result and Plaintiff’s family no longer own their Body shop

properties.

RICO CONSPIRACY:

K. Elder is the sole shareholder of his pride and joy GoWireless, Inc.. Elder has been

nationally recognized for the growth of GoWireless, Inc. by Forbes under 40. He is rated as No.

1617 by Inc. 5000, with a 177% growth rate between 2006 to 2009. He is sole share holder of

Pimlico Ranch LLC and is also a managing member of Drake Development LLC which

company developments real estate. There is Mesquite LLC, Turtle Rock LLC, Vista Village

LLC, and numerous other real estate projects unknown. It is a documented fact that K. Elder

commingles his companies funds at will. It is a fact that Woodside made a statement that Pimilco

funds “may have been used” for GoWireless with an immediate recantation.

When K. Elder, R. Elder, and Woodside submitted an application for a “construction

loan” with the knowledge that it was not going to be used for the construction of the intended

project they conspired to commit bank fraud.

When K. Elder diverted Pimlico Ranch LLC investment funds into his personal bank

account he committed wire fraud.


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When Cohen and Alliance Bank issued an unbridled line of credit without regard for

performance under the disguise of a “Construction Loan” they committed bank fraud.

Title 18 U.S.C. section 1962(d) proscribes a conspiracy to violate RICO. It provides: "It

shall be unlawful for any person to conspire to violate any of the [other RICO] provisions." 18

U.S.C. section 1962(d). It is the mere agreement to violate RICO that § 1962(d) forbids; it is not

necessary to prove any substantive RICO violations ever occurred as a result of the conspiracy.

Aetna Cas. Sur. Co. v. P & B Autobody, 43 F.3d 1546, @ 1562 (1st Cir.1994). See also, Salinas

v. United States, 522 U.S. 52, 118 S.Ct. 469, 139 L.Ed.2d 352 (1997), (which held that a

defendant who was acquitted of the substantive racketeering charge nonetheless could be

convicted of conspiracy to violate RICO.)

The illegal agreement need not be express as long as its existence can be inferred from

the words, actions, or interdependence of activities and persons involved. Id. If a RICO

conspiracy is demonstrated, "[a]ll conspirators are liable for the acts of their co-conspirators."

Sec. Investor Prot. Corp. v. Vigman, 908 F.2d 1461, 1468 (9th Cir.1990) rev'd on other grounds

sub nom. Holmes v. Sec. Investor Prot. Corp., 503 U.S. 258, 112 S.Ct. 1311, 117 L.Ed.2d 532

(1992) (internal quotations and citations omitted). Holding RICO conspirators jointly and

severally liable for the acts of their co-conspirators reflects the notion that the damage wrought

by the conspiracy "is not to be judged by dismembering it and viewing its separate parts, but

only by looking at it as a whole." Vigman, 908 F.2d @ 1468.

"[O]ne who joins with the existing conspirators in the criminal plan does not create a new

conspiracy but becomes a member of the existing conspiracy. Hence, an overt act committed

prior to the new member joining will be just as effective against him or her as against the prior

parties...."). U.S. v. Fernandez, 388 F.3d 1199 @ 1225 (9th Cir., 2004)


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BREACH OF CONTRACT:

In California, in order to state a claim for breach of contract a plaintiff must plead: (1) the

existence of the contract; (2) performance by the plaintiff or excuse for nonperformance; (3)

breach by the defendant; and (4) damages. First Commercial Mortgage Co. v. Reece, 8 9 Cal.

App. 4th 731, 745 (2001).

Plaintiff has pled the existence if a contract between Pimlico Ranch LLC and B&D. The

contract was attached to the Complaint as exhibit 2. Plaintiff pled that B&D wire transferred $3.5

million to K. Elder in consideration of said contract and that K. Elder refused to pay the interest

on said contract. As damages Plaintiff has pled the monthly payments of approximately

$50,000.00 for the last six years and the initial $3.5 million issued in consideration of said

contract.

Paramount is the breach by K. Elder of diverting the investment funds into his personal

account and deceiving B&D that the project would be completed in the scheduled time period.

PROMISSORY FRAUD:

The Defendants disingenuously claim the instant action is nothing more than a simple

breach of contract. A breach of contract is not fraud. However, when the breaching party never

intended to perform in the first place, the promise is fraudulent, plain and simple. Promisees have

a right to think that they are bargaining for performance, not an action for breach of contract.

“Promissory fraud is a subspecies of the action for fraud.” See Behnke v. State Farm

General Ins. Co., 196 Cal. App. 4th 1443, 1453 (2011). "A promise to do something necessarily

implies the intention to perform; hence, where a promise is made without such intention, there is

an implied misrepresentation of fact that may be actionable fraud." Id. The elements of

promissory fraud are a promise made regarding a material fact without any intention of


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performing it; the existence of the intent not to perform at the time the promise was made; intent

to deceive or induce the promisee to enter into a transaction; reasonable reliance by the

promisee; nonperformance by the party making the promise; and resulting damage to the

promise. Id. “

K. Elder misrepresented that B&D’s $3.5 M would purchase the Pimlico Ranch LLC

Project and property outright. He was also misrepresented that B&D would have “the

opportunity to participate in the development of the property.“ Moreover, the core statement is

K. Elder promised that the project would be completed on schedule and backed said promise

with his GoWireless Inc. and its 80 stores. Based upon this statement B&D liquidated family

assets to invest in Pimlico Ranch LLC Project. The liquidation involved selling properties with

lease-back options. The lease payments are monthly damages.

The United States Supreme Court has recently discussed the fraud scienter requirement,

holding in Tellabs, Inc. v. Makor Issues and Rights, Ltd., 127 S.Ct. 2499 (2007), that a strong

inference "must be cogent and compelling, thus strong in light of other explanations." According

to the Court, "[t]he reviewing court must ask: When the allegations are accepted as true and

taken collectively, would a reasonable person deem the inference of scienter at least as strong as

any opposing inference?" Id. @ 2511.

The facts are that Pimlico had a first loan of 11.4 million and never built a house. Pimlico

secured a second loan for 13.9 million and never built a house. Elder mislead B&D by stating the

$3.5 million investment was for outright purchase of Pimlico LLC and property. K. Elder

mislead B&D by stating they were subordinating to a “construction loan” when it was a “money

purchase loan/personal loan.” K. Elder caused the Pimlico investment funds to be transferred

into his personal account. Exhausted the approved line of credit for $13.9 million without


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building one house on Pimlico LLC. Alliance Bank never visited the construction site or

monitored the release of funds.

Plaintiff believes that one can reasonably infer that there was no intent to build Phase I of

Pimlico Ranch LLC within the time-frame stated in the Prospectus and that every Defendant,

named and unnamed, knew the project would never be completed in a timely fashion. When a

reasonably prudent person would hear the foregoing facts and then look at the bare vacant 30

acre lot they would conclude there was fraudulent intent from the start. There can be no other

reasonable explanation for investing $36.6 million and never building “ONE” house. Plaintiff

would ask that this Court follow the U.S. Supreme Court‘s admonition "We reiterate, however,

that the court's job is not to scrutinize each allegation in isolation but to assess all the allegations

holistically." Tellabs, Id. @ 2511

Plaintiff contends that Counsel for K. Elder and GoWireless, Inc., misses the mark with

the argument that the parol evidence rule bars Plaintiff’s promissory fraud claim based upon the

Integration clause found in the Contingent Interest Loan Agreement dated December 31, 2005;

which was drafted by said counsel‘s firm.

First and foremost, is the agreement between K. Elder, Alliance Bank, and B&D to enter

a Subordination of Deed of Trust. The Subordination Agreement is contingent upon the

performance of the Construction Loan Agreement for which B&D subordinated their position on

title. Both the Subordination of Deed of Trust and Construction Loan Agreement are dated May

26, 2006. Plaintiff believes that the aforesaid documents supersede the Contingent Interest Loan

Agreement. Within the Construction Loan Agreement is the exact personally guaranteed

performance by K. Elder that was promised to B&D.

BANK FRAUD:

The bank fraud statute prohibits one who "knowingly executes, or attempts to execute, a scheme


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or artifice ... to obtain any of the moneys ... credits ... or other property owned by" a federally insured

institution by making false pretenses. The plain language of the statute states that each execution of the

scheme constitutes a separate offense. See United States v. Poliak, 823 F.2d 371, @ 372 (9th Cir.1987),

cert. denied, 485 U.S. 1029, 108 S.Ct. 1586, 99 L.Ed.2d 901 (1988).

Rule 9(b) provides that "[i]n all averments of fraud ... the circumstances constituting fraud ... shall

be stated with particularity." "A pleading is sufficient under rule 9(b) if it identifies the circumstances

constituting fraud so that a defendant can prepare an adequate answer from the allegations." Moore v.

Kayport Package Express, Inc., 885 F.2d 531, @ 540 (9th Cir. 1989) (citations omitted). "The plaintiff

must set forth what is false or misleading about a statement, and why it is false." In re GlenFed Inc. Sec.

Litig., 42 F.3d 1541, @ 1548 (9th Cir.1994)

Plaintiff has plead that “Alliance Bank, by and through its acting agent, Mark Cohen, did conspire

with K. Elder, and others to commit bank fraud by issuing a $13.9 million dollar ‘construction loan’

without regard for performance.” [Complaint page 10, para. 54] Plaintiff also attached to Complaint

exhibit E which is the “Construction Deed of Trust” based upon said “construction loan” filed in the

Official Records of Riverside County by Alliance dated May 25, 2006.

These facts articulate the who, what, when and where necessary for submitting a defense.

Plaintiff believes this satisfies the requirements of Rule 9(b).

It is an undeniable fact that the terms of said “Construction Loan Agreement” stated the purpose

of the loan with specificity as:

“CONSTRUCTION LOAN TO COMPLETE PHASE I OF A SEMI-CUSTOM SINGLE FAMILY RESIDENTIAL SUBDIVISION IN MURRIETA, CALIFORNIA (PHASE I INCLUDES COMPLETION OF ALL 25 LOTS AND BUILD OUT OF ONE MODEL HOME AND EIGHT PRODUCTION UNITS).” See exhibit The method of payment in the “Construction Loan Agreement” as follows:

“Conditions precedent to each advance….

Equity Funds. Borrower shall provide evidence of equity funds totaling $3,500,000.00 prior to the initial advance from the Loan Fund….Disbursement of Loan Funds. ….Borrower shall apply only for disbursement with respect to work actually done by the General Contractor and for materials and


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equipment actually incorporated into the Project…..Construction of the project. Commence construction of the project no later than June 25, 2006, and cause the improvements to be constructed and equipped in a diligent and orderly manner and in strict accordance with the plans and specifications approved by lender, the construction contract, and all applicable laws, ordinances, codes, regulations, and rights of adjoining or concurrent property owners. Borrower agrees to complete the Project for purposes of final payment to the General Contractor on or before May 25, 2007, regardless of the reason for delay.”

Plaintiff believes that it can be reasonably inferred that K. Elder committed bank fraud inasmuch

as the 30 acre lot is vacant and the $13.9 million “construction loan” money is spent.

There is further evidence of bank fraud whereby K. Elder did conspire with Alliance Bank to

conceal a “payoff” in a “construction loan.“

FRAUDULENT CONCEALMENT:

Plaintiff has stated K. Elder concealed the fact he procured a “Construction Loan.“

Counsel disingenuously claims that “these statements are flatly contradicted by the

Subordination Agreement signed by Alliance Bank and Ben on May 25, 2006[]” and then he

quotes the Notice contained within the document:

NOTICE: THIS SUBORDINATION AGREEMENT CONTAINS A PROVISION WHICH ALLOWS THE PERSON OBLIGATED ON YOU’RE YOUR PROPERTY SECURITY TO OBTAIN A LOAN, A PORTION OF WHICH MAY BE EXPENDED FOR OTHER PURPOSES THAN IMPROVEMENT OF THE LAND.

Counsel goes on to emphasize the fact “that the borrower could use proceeds for purposes other

than land improvement[]” by preceding it with an italicized “and”. This must be Counsel’s legal

justification for his client spending ALL $13.9 million from the “Construction Loan” on

expanding GoWireless, Inc., etc., etc..

FRAUD:

Taking all factual pleadings as true we have; (1) In November 2005, in the office of the


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Trustee for B&D K. Elder representing himself as the sole share holder for GoWireless, Inc.,

presented an investment to purchase Pimlico Ranch LLC with Property; (2) at said presentation

K. Elder guaranteed successful and timely completion of said project and backed it buy his

GoWireless, Inc.; (3) K. Elder diverted said $3.5 million investment in to his personal account;

(4) K. Elder stated Subordination was necessary to obtain a “construction loan” to complete the

project; (6) K. Elder concealed the fact he obtained a $13.9 million loan; (6) the “loan” contained

an undisclosed “$3.8 million payoff”; (7) K. Elder guaranteed performance of the construction

loan; (8) the $13.9 million “construction loan” is spent; (9) the Pimlico Ranch LLC lot is vacant;

and, (10) K. Elder refuses to make interest payments or account for the money transferred into

his personal account.

In order to plead fraud with particularity, the complaint must allege the time, place, and

content of the fraudulent representation; conclusory allegations do not suffice. Moore v. Kayport

Package Express, Inc., 885 F.2d 531, @ 540 (9th Cir.1989).

The aforesaid facts establish time, place, and the fraudulent representation.

TIMELINESS:

Taking all facts as true plaintiff discovered the fraud in May of 2010.

CONCLUSION:

There is documented evidence that $32.6 million was invested in Pimlico Ranch LLC and

other than the removal of some trees and shrubs [which the company had to lien title to get paid]

there was no performance of construction in any form. As a matter of fact there was never a stake

driven in the ground. Plaintiff believes that he has established a pattern of racketeering activity.

WHEREFORE, it is respectfully requested that this Honorable court defer ruling on the


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instant Motion to Dismiss until such time a limited discovery is completed.

DATE: January 9, 2012

Respectfully submitted,

Raoul Barrie Clymer


Documents

GoWireless, Inc Verizon service provider