Pittsford Capital Scam
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D M Lynch

Portland, OR

#1 Nov 2, 2006
Did you know that one of the Defendants in the Pittsford Capital Scam, that blinked about 300 local senior citizens out of millions in life-savings, is working as a REAL ESTATE AGENT IN PITTSFORD???? How is that????? Just shows you what rich, white men can get any with no matter WHAT they have done. I mean, Mr Palazzo's scam was run through the MORTGAGE company he and Mr. Tackaberry owned. I have provided you with the following links I suggest you look at them. Roughly 300 Seniors worked their entire lives in the Rochester area and lost everything. That affects MANY families in this area and the fact that one of these men can turn around and get a job in the LOCAL real Estate/Mortgage arena is DISGUSTING. I suggest you contact the Rich Group as they are the employers of Mr Palazzo and seem to not be concerned with exposing innocent people to this man and allowing him access to their financial and mortgage information!!!!!!!!
Mark Palazzo is working as a Real Estate agent for the Rich Group. see link http://www.weichert.com/search/agents/AgentPr...

Link to SEC's Litigation release is: http://www.sec.gov/litigation/litreleases/200...

Link to Attorney Lucien Morin's Receiver's report: http://www.mccmlaw.com/documents/PCGreceiverr...

Further information can be found on the web page of the law firm that Mr Morin is employed at. www.mccmlaw.com

United States

#2 Apr 27, 2007
I think it is disgusting that someone would hire this thief to work for them. My parents were on of the victims he scammed and i think he should be in jail not working scamming more people.
He shouldn't even get a paycheck it should go to all these families that you scammed you lousy SOB. I hope you pay for the rest of your life and i hope your life is now misserble just like you did to those innocent people you took advantage of.

United States

#3 May 29, 2007
My husband and I invested in the Poccono's trail park through Pittsford Capital-Mark Palazzo. Does anyone have a phone # that I can call to get an update? Pittsford Capital is not listed any longer.


#5 Jun 27, 2007
Diane wrote:
My husband and I invested in the Poccono's trail park through Pittsford Capital-Mark Palazzo. Does anyone have a phone # that I can call to get an update? Pittsford Capital is not listed any longer.
Hi Diane.....Call the law firm I have a link to in my posting. Lucien Morrin is the attorney and he should be able to help you!


#6 Jun 27, 2007
Shelly wrote:
I think it is disgusting that someone would hire this thief to work for them. My parents were on of the victims he scammed and i think he should be in jail not working scamming more people.
He shouldn't even get a paycheck it should go to all these families that you scammed you lousy SOB. I hope you pay for the rest of your life and i hope your life is now misserble just like you did to those innocent people you took advantage of.
By all means....feel free to contact the real estate office that was shady enough to hire him and let them knwo what ya think :)!


#7 Jun 27, 2007
concerned citizen

Washington, DC

#8 Aug 24, 2007
I just found out that Mark and his partner were convicted yesterday of defrauding their clients of $15 million. Now the Justice Department will step in and file criminal charges against them.

Game Over!
Jane - PC Investor

United States

#9 Sep 5, 2007
Did you know that the average investor received approximately 80% of their dividends (who knows what the principal will be - approx. 20-30% of the value was probably lost just due to the SEC filing. Since the receiver has taken over, it has been further reduced by the legal fees it is charging to liquidate the assets.
Did you know the law firm Harter Secrest @ Emery LLP generated all the legal documents for the Defendants’ business activities. Why weren't they libel for any damages?
Read on for information that has not been provided to the investors (except for a few of us) and what you have not read in the media.
Defendants’ intent to commit fraud is not supported by the evidence in that the SEC is alleging fraud but not with what the evidence shows. Also, the SEC has failed to fully consider that the Defendants were completely relying on their attorneys, Harter Secrest, for direction and advice, and that their attorneys generated all the legal documents for the Defendants’ business activities. Reliance on their attorneys’ directions and advice causes the fraud intent and materiality factors relating thereto to evaporate.
For a number of years since 1994 the Defendants were a highly reputable, respected, and successful entity. The Receiver indicates that there were periods of time when the Issuers acted properly; see for example, page 13 of the November 30, 2006 Preliminary Report Of The Receiver which states in part
“From the Receivers review, it appears that things proceeded during the period 1996 to 1999 in due fashion. During that time period, the Issuers proceeded with raising funds in accordance with each PPM and were investing in various mortgage loans.”
Also, the SEC is attempting to extend its accusations of fraud for the period 1994 to 2003 by relying on comments and evidence for the period 2004 to 2006; this type of retroactive fraud being advanced by the SEC has not been adequately supported by the SEC’s positions and evidence.
Additionally, the SEC has misstated some facts, has presented part of the facts and not the full facts in some instances, or at least has ignored facts, which may be contrary to its positions, and in a number of instances is relying on its own statements and interpretation of the facts to attempt to support its foregone conclusions. The SEC is not permitted to generate a preconceived conclusion and then apply the facts with hindsight.
The SEC is also selectively continuing to rely on only certain evidence that supports the foregone, preconceived conclusions of the SEC while ignoring other evidence as more fully detailed herein; and the SEC has clearly not established a position of fraud or intent to commit fraud.
SEC’S $11,725,294.82
Jane - PC Investor

United States

#10 Sep 5, 2007
Read On:

The SEC has not factored in, and subtracted from its amount, that the Borrower’s defaulted and did not pay back to Pittsford the money the Borrowers owed for their loans. The Issuers are not responsible for such unpaid loans despite the SEC’s positions to the contrary. The Investors were aware that there were serious risks in the purchasing of the Notes, that the Investors were risking their entire investment, and therefore, the Investors are not entitled to be made whole again as the SEC is faultily propagating. Also, there needs to be subtracted from the SEC’s $11,725,294.82 amount the amount of principal and interest paid to the investors (see page 16 of the SEC’s Preliminary Statement indicating that the total amount redeemed is $3,325,148.86); the value of the Pittsford assets that are in the control of the Receiver; the costs for Pittsford to arrange for the Notes, legal documents, and legal advice; the Pittsford business costs; the management fees; and other costs, including the Defendants’ costs for defending against this SEC Action, and money damages resulting from the SEC’s actions that closed the Pittsford businesses.

Pittsford Capital issuers’ operating agreement; confidential private placement memorandumS of Pittsford income partners I to V; matters to be decided by unit holders/investors

The PPMs, the operating agreements, and other documents prepared by the Issuers’ Attorneys and given to and acknowledged in writing by the investors, including the subscription agreements, and amended operating agreements, clearly and substantially repeatedly point out in no uncertain terms the significant risks to investors in agreeing to subscribe to any offers from the Pittsford Issuers. For example, the confidential Private placement memorandum, Pittsford income partners III, L.L.C. of February 5, 1998, see Exhibit 300. All of these documents were prepared by the Defendants’ attorneys and that the Defendants’ acted at all times in accordance with their attorneys’ directions. Additionally direct to the PPMs, which state that the funds were being managed by Paul Adams for Pittsford I and II, and not by the Defendants. A number of the loans were first completed by Paul Adams and subsequently by the Defendants. Since the risks were repeatedly pointed out to all the investors, and the borrowers defaulted on the loans, what these borrowers owed to the Issuers was not returned to the fund. Thus, the Fund was depleted, and did not at various times have sufficient money to honor investors’ redemptions, and other obligations. Each of the investors was continuously informed in numerous written communications by the Issuers of the financial conditions of the Funds and the reasons thereof as demonstrated by Exhibits 295 to 299, 299A, 299B and 299C. The Issuers in some of their communications to investors specifically stated that the fund was under capitalized and why. This in of itself is a main factor that establishes that the Issuers were not intending to commit fraud as alleged by the SEC.
Jane - PC Investor

United States

#11 Sep 5, 2007
Read On:

Part of the existing record is the Private Placement Memorandum III of February 5, 1998, which states in large capital letters and in bold that this investment involves a high degree of risk, see for example, page ii of PPM III,“Risk Factors”. Quoted below is the entire referred to paragraph of PPM III, page ii, stating this risk.

“This investment involves a high degree of risk. see ‘risk factors.’ it is only suitable for those persons who can meet minimum standards of income and net worth. the notes are not readily TRANSFERABLE and should only be purchased for long-term investment. accordingly, each investor must demonstrate that he, she or it has the ability to evaluate this offering or has retained the services of representatives who have sufficient knowledge and expertise to evaluate this investment. see ‘terms of the offering – suitability of investors’ and ‘restrictions on transfer’.”

Furthermore, please see page iii of PPM III, which states in large bold letters in paragraph 3 thereof

“Investment in the securities described herein should be considered only by a person who or entity that can afford to sustain the loss of his, her or its entire investment. Potential investors are hereby cautioned that such investors, should they invest in the securities described herein, could be required to bear the financial risks of such an investment for a substantial and/or indefinite period of time. An investor who purchases the securities described herein shall be required to represent that he, she or it is able to sustain such a loss, is familiar with and understands the terms of the offering of such securities and that he, she or it meets certain suitability standards.”

Also, on page v of PPM III there is a warning again in large bold letters that

“each investor should consult his personal counsel, accountant and other advisors as to legal, tax, economic and related matters concerning the investment described herein and its suitability for such investor.”

Referring to Pittsford Income Partners III, L.L.C., Exhibit 300, page 1,“Summary Of The Offering”, there is presented on page 4 of this document, risk factors, which are fully and clearly enunciated, noting that at the top of page 4 the PPM specifically states “Risk Factors”, thus the investors are charged with understanding and capturing this part of the document. On page 4, it specifically states that

“Purchase of the notes offered hereby involves a high degree of risk and must be considered a speculative investment.”

Subsequently, the document states in the first paragraph that

“Prospective investors should, prior to any purchase of notes, carefully consider the following risk factors, as well as the other information contained in this memorandum and attached hereto as exhibits.”

The risks are then specifically recited under the headings “Risks Relating to the Company”, pages 4 and 5 of PPM III; “Tax Risks”, page 6; “Investor Related Risks”, page 7; and which risks are conveyed in a written manner that would enable any reasonable person or investor, certainly including those investors that purchased promissory notes, who were well educated with college degrees, were employed for long periods of time, some in management positions, and had suitable assets, including for some investors over 2 million dollars, to clearly comprehend these risks.
Jane - PC Investor

United States

#12 Sep 5, 2007
Read On:
Sufficient to indicate that the risks recited in the Pittsford Issuers’ documents were not hidden by any means as summarized, for example, see page 4 under “General Risks of Mortgage Lending”, beginning at line 8, as follows.
“The company expects that the principals issuing the Mortgage Notes to be acquired by the company will be borrowers who are not normally eligible to borrow from banks and similar financial institutions for a variety of reasons, including but not limited to, poor credit history and the existence of judgments or liens against such borrowers. The percentage default on the Mortgage Notes is therefore likely to be high. As a result, the Company expects to charge interest on the Mortgage Notes at the rate of approximately sixteen percent (16%) per annum.”
A number of the borrowers defaulted on their written contract promises, and did not honor their payment obligations as set forth in the contracts. This resulted in a decrease in the fund’s assets. Therefore, at times the Issuers had insufficient funds to redeem notes, which they only had to do if they had sufficient funds as specifically stated in the PPMs, and in some instances the Issuers did not pay what may have been due to investors. The investors were specifically informed of this in numerous communications from the Issuers as substantiated hereinbefore.
Jane - PC Investor

United States

#13 Sep 5, 2007
Read On:
Also, throughout the PPM III of February 5, 1998 and for Pittsford II, IV and V the risks are again clearly pointed out to the investors, reference beginning on page 17,“Terms of the Offering”, see page 18 of PPM III, for example, wherein it is stated that
“Investment in the notes involves a high degree of risk and is suitable only for investors who have substantial financial resources and who understand the long-term nature, tax consequences, risk factors and possibility of loss of such investor’s entire investment in this Offering. Investors must be able to bear the loss of their entire investment in the notes.”
“New York residents must have a minimum net worth of either:(i) five times their investment (exclusive of home, furnishings or automobiles); or (ii) four times their investment (exclusive of home, furnishings or automobiles) and an annual income of $100,000.”
Investors are not pleased in situations where there is a potential that or where they may not recover their entire principal plus profits. The Pittsford Issuers timely and continuously paid to the investors interest payments, which in some instances exceeded the principal initially invested by the investor and/or looking back approached between 75% and 85% of what the investor initially agreed to, see for example Defendants’ Exhibit 301, page 2 of 3. Further, the Issuers redeemed for investors a number of notes, and initiated successful court actions against and recovered money damages from the borrowers. The SEC seems to be of the general view that the investors had no risk, that is a risk free investment, which is anot the situation for these types of investments. Pittsford Issuers’ notes were not in default at the time that the SEC initially filed with the Court it’s July 14, 2006 Complaint, and some are still not in default. Each of the Pittsford notes I, II, III and IV had an initial five year term, which could be and were extended for another five years at the sole discretion of Pittsford Issuers, see Issuers’ Exhibit 300, PPM III, which indicates on page 1, under “The Notes”,
“... provided, however, that the company in its sole discretion may extend the term of any Note for an additional five years.”
See Exhibits 302, 303, and 304 evidencing that the notes for Pittsford II, III and IV were in fact extended and that V could be extended for 5 years, see Exhibit 304.
In regard to the 5 year extension of the PPM V notes, the Court is directed to Exhibit 304.
The Defendants were operating with the understanding that Pittsford V was for an initial 5 year term, but that it could be extended for another 5 years, the same as II, III, IV, and I. Accordingly, the Defendants had authorization to extend Pittsford V, see Exhibit 304, signed on July 27, 2004 by Mark J. Palazzo as the manager of Pittsford Capital, and mailed to the investors, which in part states:
“Resolved that the Company, as successor in interest by merger to Pittsford Capital Income Partners V, L.L.C.(“Income Partners V”) shall be authorized to request the holders of all Promissory Notes of Income Partners V issued in connection with its Private Placement Memorandum dated August 23, 1999 to extend the term of the Note issued for an additional five (5) years upon the expiration of each such Promissory Note.”
Jane - PC Investor

United States

#14 Sep 5, 2007
Read On:

A letter dated August 11, 2004 from Daniel Kinel of Harter, Secrest, which indicates that the attached consent, Exhibit 304B, has been revised to indicate that although it is dated July 10, 2002, the date the first batch of notes would have been due, it was actually signed on July 27, 2004, the date it was sent to the Pittsford Issuers.

Therefore, depending exactly on when the investors subscribed, that is what month, day and in some instances year, and noting that there was no default for at least 30 days after the date that the subscription agreement was signed by the investors, the term of the notes was and is at the earliest with respect to a default as follows

Pittsford I July 17, 2006

Pittsford II August 11, 2007

Pittsford III March 5, 2008

Pittsford IV December 6, 2008

Pittsford V Extended to September 23, 2009.

Also of relevance is Exhibit 305, a July 30, 2004 letter from Elizabeth Stehler of Harter, Secrest & Emery, with a copy to Daniel Kinel, a Harter, Secrest attorney, to Michele Bolognesi of PCM, which letter states that

“You advised that your office will prepare the documentation to extend the 10% Promissory Notes issued by Pittsford Income Partners, L.L.C., Income Partners II, III, IV and V (now all merged into Pittsford Capital Mortgage Partners, LLC using the forms sent to Mark Palazzo on July 27, 2004.”

This is further evidence that the notes for V could be, and were extended, and the Issuers acted in accordance with their Attorneys’ advice.

Additionally, of relevance especially with regard to obtaining loans, such as what the SEC alleges was a loan from Jefferson Income Partners to the Issuers, the Court is referred, for example, to page 6 of PPM III, Exhibit 300, and other PPMs of record, which state in part, emphasis added, accompanying the title “Future Borrowing; No Sinking Fund”,

“There are no restrictions on unsecured or secured borrowing by the Company.“(Pittsford Issuers)(emphasis added)

Further, on page 6,“Future Borrowing; No Sinking Fund”

“In the event the Company becomes over leveraged, it may not be able to make either principal or interest payments on the Notes when due. Furthermore, there is no sinking fund for retirement of the Notes at or prior to their maturity. The Company anticipates that it will pay the outstanding principal and interest due under the terms of the Notes from working capital. However, no assurances can be given that the Company will have sufficient available funds to make such redemption.”
Jane - PC Investor

United States

#15 Sep 5, 2007
Read On:
Investors’ Consents
Investors’ consents were obtained for the mergers of I, II, III, IV and V into Pittsford Capital noting that the SEC has relied on a March 20, 2000 letter from Palazzo stating in part that in order to merge the entities, the written majority consent of the members required; the required consents were obtained as illustrated by the evidence below. Very importantly, however, the SEC has pointed to no such consent requirement in any of the PPMs, which formed part of the contracts with the investors. Rather, the SEC is relying on only a letter, which is entitled to a little weight from an evidentiary standpoint, as compared to the PPMs with no SEC provided basis that investors’ consent was required for a merger.
In furtherance of the merger issues, attached is an August 8, 2000 letter from Daniel R. Kinel, an attorney at Harter, Secrest & Emery, to Joseph C. Cusanno, Pittsford Capital Mortgage Partners, L.L.C., reference Defendants’ Exhibit 306, which outlined for the Issuers specific legal advice as to the merger of each of Pittsford Capital Income Partners, L.L.C. III, IV and V, and which advice was followed, reference the following Exhibits of Defendants attached hereto, and which represent further irrefutable evidence that the mergers of I, II, III, IV, and V were proper. In Exhibit 306, Harter, Secrest advises the Pittsford Issuers
“Please do not have the documents dated.”
Exhibit 307 (Harter Secrest HSE 0000788 to 0000807), signed by the Manager of Pittsford Capital LLC, the Class A Unit Holder, the class C Unit Holder, and the class B unit holders, and a number of the trustees establishes that the investors approved by their respective signatures of the merger of Pittsford III, IV, and V within and into the Company. Also referred to Exhibits 308 to 317, which evidence that the mergers were properly accomplished, see for example the parts of these Exhibits which detail the plans of the merger, merger agreements, written consents, and the Certificates of Merger.
Reviewing further Exhibit 308, titled “Pittsford Income Partners III, L.L.C. Written Consent of the Sole Member and manager”, the first resolution states
“RESOLVED, that it being in the best interest of the Company, that the merger of the Company with and into Pittsford Capital Mortgage Partners, LLC, pursuant to that certain Agreement Plan of Merger between the Company and Pittsford Capital Mortgage Partners, LLC, in substantially the form attached to this consent as Exhibit A (the “Plan”), be consummated, together with such changes as the Manager may approve, such Manager’s signature thereon being conclusive evidence of such approval.”;
and the third resolution states
“Resolved, that the execution, delivery and performance by the Company of all such further instruments and documents required by, under or in connection with the Plan and the Certificate to be executed, delivered or performed by the Company, each in form and substance approved by the manager of the Company, such Manager’s signature thereon being conclusive evidence of such approval, are hereby in all respects approved, adopted and authorized by and on behalf of the Company.”
Peter Elmira NY

New York, NY

#16 Sep 5, 2007
It is interesting to see Jane's comments. Why is it that when an investor makes his/her own decison to invest in a high risk investment that it is fine if it does well, and all because the investors 'smarts and foresight" but if it does not perform up to expectations, then the lawyers have a field day and all of a sudden, investors blame everyone else but their own decison making to make a high risk investment. And what happens to the law firm? They drafted all of the documents, they advised, isnt THAT where the money is? And why isnt anything said of all of the return investors received either in distributions of return of principal to hte investors, seems like 15 million of the 17 million raised!
Jane - Pittcap investor

Rochester, NY

#17 Sep 5, 2007
Another tidbit:

It is believed that had the SEC not brought the July 14, 2006 Complaint resulting in a preliminary injunction freezing all the assets of the Pittsford Issuers and Communicate Wireless, and putting these entities out of business totally, that Communicate Wireless and Pittsford Issuers could have or had excellent potential to continue with their operations and generate substantial revenue including, it is believed, more than the $2.4 million to be paid back to the Pittsford Issuers. One piece of evidence pointing to this conclusion is the granting by CapSources to Wireless of $2 million, reference Exhibit 334, an email message from Gene Butler dated October 5, 2005.
The above letter stated

“The Monthly business meeting of CapSources just ended and I was given formal notice that all the partners voted to go forward your deal. We now have the complete package for $2,000,000. I will speak with Tim Wells again tomorrow, but we need to hit it. The quicker we get the due diligence going the quicker we get it done. We also need to get the initial term sheet done ASAP. Rand Ray says they would like to get the deal closed in November. Congratulations!!!!!!!!!!
David Lynch


#18 Sep 6, 2007
Jane, it is clear you are some sort of friend of MArk Palazzo or Ted Tackaberry maybe even Mr Palazzo's attroney as this sounds similar to the outlandish claims he made. However, they would found to be liable for their fraud and thus this article was published in D&C on Sunday 9/2/07.

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Two brokers ordered to pay $11.7M

Final judgment issued against local businessmen for cheating investors

Staff reports

(September 2, 2007)— A final judgment was issued Thursday by U.S. District Court Judge Michael Telesca against two local investment brokers for violations of the Securities and Exchange Act.

Mark Palazzo and Edward Tackaberry were executives with Pittsford Capital LLC and were involved with several other business entities. Each man has been ordered to pay back approximately $11.7 million by Sept. 14. Also, Palazzo and Tackaberry each must pay a civil penalty of $75,000 to the Securities and Exchange Commission by Sept. 14.

A civil lawsuit brought by the SEC alleged that between 1999 and 2006, Palazzo and Tackaberry were involved in "breaching mortgage loan requirements, commingling investors funds, concealing important information from investors designed to lull investors into a false sense of security."

Tackaberry did not respond to messages left Saturday at his home and at the office of his attorney, Seth Green. Mark Costello, attorney for Mark Palazzo, could not be reached for comment.

AND should anyone want to see the actual LEGAL papers regarding this judgement here is the link. http://www.mccmlaw.com/Portals/0/documents/11...
The legal information is available to EVERYONE NOT just the select few as "Jane" is claiming. Check out www.mccmlaw.com and you will be able to read the entire trail of events that lead up to the FINAL jugement being odered against these thieves.

S Palmer

Aripeka, FL

#19 Sep 6, 2007
I have had money invested with Mark Palazzo and Ted Tackaberry for 20 years. My 3 kids and parents have also had money invested with Pittsford Capital. Some investments I have been better than others. I had the opportunity to invest in this high risk venture and chose not to. Please note that I took the risk for my financial investments good and bad.

What I like to do in a business situation is discuss facts. If your source for fact is the D and C or local News Stations, I would refer you to court documents, from both sides. Jane appears to be someone that represents fact and not opinion. Becuase she represents factual information does not make her a personal friend, it makes her and educated and informed person. Do not abreviate facts to come to a final "opinion" or conclusion to publicly fry a man and his family in the media.

Read every line of the court procedings, prosecution and defense. There was no wrong doing ever to be found, no fraud. People lost money on a high risk investment, this is the 2nd case inthe history of the US that a suit has been brought against an investor for his clients not making enough money. When you make high risk investments, you win and lose.
David Lynch


#20 Sep 6, 2007
The facts are listed on the MCCMLAW.com website. People don't have to pay civil penelties to the SEC because they are just innocent people that were lead astray by Harter Secrest. The legal documents are all listed on the MCCLAW.com website, Folks.... I encourage you to take a look at the ACTUAL LEGAL papers which are NOT comprised of "opinion" as these representatives for Palazzo and Tackaberry claim. Check the documents out. They are scanned LEGAL documents NOT opinion based polls. Bottom line is Palazzo and Tackaberry KNEW they were shifting funds and yet each had MASSIVE houses....memberships to Locust Hill and other such luxeries. Mark Palazzo's daughter attended The Harley School in rochester of which tuition is roughly 12K a year. On top of that Mr. Palazzo held a title of a ChFC. The ChFC prepares you to meet the advanced financial planning needs of individuals, professionals and small-business owners. You’ll gain a sustainable advantage in this competitive field with in-depth coverage of the key financial planning disciplines, including insurance, income taxation, retirement planning, investments and estate planning. In fact, ChFC designees average up to 51% higher income than their peers. So for the representatives of Mr Palazzo and Mr Tackaberry to portray these two as wide-eyed innocents is laughable at best. Again, the legal trail can be found at www.mccmlaw.com .
David Lynch


#21 Sep 6, 2007
Here's another article as well as the email of a Kodak retiree that lost over 100K with the mislead Mark Palazzo and Ted Tackaberry. As HIM how much money he got back from the fraud......SEC doesn't come down on people whom made "bad investments at high risk". These two targeted older people that lived Rochester, NY. I guess we will see how "innocent" Mr Palazzo and Mr. Tackaberry are once we see if the Justice Department decides to press legal charges, though I would guess these so called "investors" will then claim the US Justice Department is basing IT'S findings on opinon as well. LOL
Scam Victims to Get "10 Cents on the Dollar"
Last Update: 9/05 10:31 am
Print Story | Email Story
Scam Victims to Get "10 Cents on the Dollar"
Kodak retiree Bud Taylor lost $135,000. Rachel Barnhart (Rochester, N.Y.)– Bud Taylor invested $135,000 – his life savings – with Pittsford Capital when he retired from Kodak seven years ago.
“My wife and I had plans to do things when I retired. Most of those things are just basically on the back burner and moving further back as time goes on,” he said.
Taylor is one of 275 people, many of them retired, who lost money investing with Edward Tackaberry and Mark Palazzo. The men were principals in six real estate investment firms, including Pittsford Capital.
In response to a civil lawsuit brought by the Securities and Exchange Commission in 2006, a federal judge ruled last week that Tackaberry and Palazzo defrauded investors by misrepresenting their financial dealings and the risks associated with their businesses. They also commingled the funds of their businesses.
They were ordered to pay back $11.7 million in restitution.
“You sit back and assume everything is all right, until you hear otherwise, and that's what happened to us,” said Taylor.
Taylor and the others will only get back a fraction of their investments.
Local attorney Lucien Morin was appointed the receiver in the case. After liquidating many Pittsford Capital properties, he has recovered about $500,000 to distribute to the victims.
"My best guess is 10 cents on the dollar, not unless there's something else out there I'm not aware of,” Morin said.
Morin still has one more property to liquidate, but that won’t happen until next year. He plans to apply to the judge for an interim distribution later this year.
“I'm forced into a corner. I have to accept what I can get," Taylor said. "It's not acceptable in terms of the way this happened."
Mobile Home Dealings Uncovered
For Taylor, the story doesn’t end with the judge’s ruling. He is part of a subgroup of Pittsford Capital investors who also have money tied up in mobile home parks controlled and managed by Pittsford Capital. The parks are in Eastern New York and Pennsylvania and are in foreclosure.
The parks were not part of the SEC action. An SEC official said the agency was not aware of Pittsford Capital’s involvement in the parks at the time it filed the lawsuit against Tackaberry and Palazzo.
Taylor said a substantial portion of the $135,000 he invested with Pittsford Capital went to the mobile homes. He said he was lured into investing the parks under false pretences, because the parks have environmental problems that are now coming to light.
Taylor suspects his mobile home investment money was commingled with other Pittsford Capital ventures. He would like the mobile home parks investigated.
“I’d like to see it investigated with the same zeal,” he said.
Taylor said attorneys for the parks and bank holding the mortgage are inclined to settle with each investor for $1,000, far less than the 10 cents on the dollar he is expected to get for the other Pittsford Capital investments.
No criminal charges have been filed against Tackaberry and Palazzo.
Taylor would like to network with others caught in the Tackaberry and Palazzo web. He can be reached at sorryinvestors@aol.com.

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