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This post was inspired by this StlToday article published yesterday – MetroLink’s new gates don’t yet work. ‘Worse than useless,’ rider says ST. LOUIS — MoDOT has now installed tolls booths at nearly one-third of the entry ramps on interstates and major highways in the region, part of a comprehensive security upgrade. But the toll […]

The post MoDOT’s new tolls don’t yet work. ‘Worse than useless,’ driver says appeared first on NextSTL.

The suit calls for former Superintendent Keisha Scarlett to pay back $56,700 to SLPS for personal and travel expenses.

The Midland Avenue home was built in 1908 for John L. Miers and designed by noted architecture firm Barnett, Haynes & Barnett, which was behind the Cathedral Basilica.

A Jefferson County Sheriff's Deputy was injured in a crash on Missouri Route 21 early Tuesday morning, while the driver of the pickup truck suffered minor injuries.

Video taken by concerned residents of the normally quiet neighborhood showed cars sliding in circles and burning out their tires in the intersection.

Greater St. Louis Inc. is seeking redevelopment ideas for the soon-to-be vacant, historic Wainwright Building.

Gov. Mike Kehoe’s office is reviewing the effects of a surprising decision Friday by the Missouri House to forgo voting on a massive construction spending measure.

When most Americans think of public broadcasting, they think of Sesame Street or All Things Considered — educational programs, in-depth journalism, and community storytelling that has shaped generations. For many Missourians, especially in rural or low-income areas, public radio and television are far more than entertainment. They’re essential services. Now, those services are under threat. […]

by Tony Schick and Monica Samayoa, Oregon Public Broadcasting

This article was produced for ProPublica’s Local Reporting Network in partnership with Oregon Public Broadcasting. Sign up for Dispatches to get our stories in your inbox every week.

Electric companies in Oregon and Washington are hurtling toward deadlines to stop using power generated by coal, gas and other fuels that contribute to global warming. Yet the states are nowhere near achieving their goals, and the dramatic consequences are already being felt.

During a winter storm in January 2024, for example, the Northwest barely had enough power to meet demand as homeowners cranked up electric heaters and energy prices surged to more than $1,000 per megawatt-hour, or 18 times higher than the usual price. Power lines were so congested that owners of the transmission network made an extra $100 million selling access to the highest bidder.

Multiple utilities were operating in states of emergency during the storm, preparing for rotating power outages.

The storm “highlighted a tipping point and demonstrated how close the region is to a resource adequacy crisis,” the Western Power Pool, a regionwide organization of utilities, wrote in its assessment of the event.

Price spikes like this are one reason customers of major utilities in Oregon are paying 50% more on their power bills than they were in 2019. The number of utility customers disconnected last year for failure to pay soared to 70,000, the highest number on record.

Forecasters predict periods of extreme weather in the Northwest will only bring more trouble in the future: the threat of rolling blackouts within the decade if the region’s current energy trends continue.

Wind, solar and other renewables are the only forms of power that can be added to solve the problem, thanks to Oregon’s and Washington’s green energy mandates. Yet better transmission lines are needed to carry new energy sources in the windy and sunny eastern parts of the region to big cities west of the Cascade Mountain Range.

Experts say adding transmission lines in corridors that currently lack them would also enable utilities to keep power flowing when ice storms or wildfires threaten other parts of the grid.

The biggest owner of these transmission lines, the federal Bonneville Power Administration, has been slow to spend on upgrades — and slow to approve new green projects until upgrades are made.

Bonneville’s parent agency, the Energy Department, declined to make officials available for an interview, but Bonneville answered written questions.

“The potential for blackouts in the Pacific Northwest is incredibly low,” the agency said. “Grid planners and operators will continue to ensure reliability.”

Washington and Oregon lawmakers failed to address the Bonneville bottleneck when they approved clean energy mandates in 2019 and 2021, as ProPublica and OPB reported recently.

Oregon Rep. Ken Helm, a Portland-area Democrat who was a sponsor of the 2021 legislation, said the failure to prioritize transmission lines wasn’t the only flaw with the legislation. He said the bill failed to provide accountability, having no penalties for when a utility did not reach certain deadlines for acquiring either solar or wind energy. Helm said now, House Bill 2021 is “dead letter law.”

“Senators and representatives like me, we cannot continue to believe our own PR, that we have been successful in promoting a renewable electricity future,” said Helm, a member of the House Committee on Climate, Energy and Environment. “We are not heading in that direction, and we’re going to have to take action to change that or nothing will happen.”

Some lawmakers tried to play catch-up this year. Legislators in each state drew up plans for state transmission authorities that could finance improvements independent of utilities and Bonneville. Those efforts failed.

“Oregon desperately needs to take some leadership here,” said Nicole Hughes, executive director of the group Renewable Northwest, which advocates for weaning the region off of fossil fuels.

The Northwest’s situation is only expected to get worse. The region’s electrical demand is forecast to double over the next 20 years, in large part because data centers, rewarded with tax breaks in both Oregon and Washington, are driving an increase in power use the region hasn’t experienced since the early 1980s.

Abandoning Oregon’s and Washington’s renewable energy laws wouldn’t help, Oregon’s Citizens’ Utility Board says, because new fossil fuel power plants would cost ratepayers more than wind or solar. Those plants would still have to contend with transmission lines that have no room for their power.

The region’s utilities, meanwhile, say they’d like to add 29,000 megawatts of generating capacity over the next 10 years — an unprecedented addition that would be roughly equivalent to all the electricity that the Northwest currently consumes at any given time. The projects on their to-do list are powered entirely by renewable energy.

Yet the utilities added only a little over half the power to their systems that they planned for last year. In fact, of the 469 projects that applied to connect to Bonneville’s grid in the past decade, the only one to win the agency’s approval was in 2022. Growth in green energy in 2024 came from projects that began seeking a connection to Bonneville’s grid prior to 2015 or that connected to smaller transmission networks owned by private utilities.

If the utilities continue to fall as short of their goals as they did in 2024, then projections from the Western Electricity Coordinating Council suggest residents will spend the equivalent of nearly a month annually under the threat of brownouts — the inability to power all the circuits in a household — or blackouts.

“In the next few years, we may start having to make some tough choices about the availability of electricity,” Hughes said.

Hughes has spent 20 years in the renewables industry.

For now, she said, her family decided to buy a gas generator for times when their house loses power.

Missouri Republicans are pushing to repeal Amendment 3, which protects abortion rights, and replace it with a new constitutional amendment that would allow abortion only in cases of rape, incest, or medical emergency and ban gender-affirming care for minors.

Blast waves from Friday’s explosive decision by Missouri House Republicans to kill a $517 million capital improvements bill echoed through the state Monday, with local officials picking up the shards of shattered plans and state senators furious as they recover from shell shock. The spending on new construction isn’t essential for the day-to-day operations of […]

The park will be named for Arsenal Business Growth, which signed an eight-year naming rights deal for the Sauget minor league ballpark.

Mayor Tishaura Jones' loss in last month's election was the latest result that was a hit to the region's progressive politics and to Black female political power.

ST. LOUIS - Our cut-off area of low pressure continues to drift north, keeping us a bit cooler for one more day. Out the door Tuesday, we’ll be dealing with dense fog in many spots. Overnight, visibility has been less than a quarter mile in spots. Once we hit sunrise, the fog will begin to [...]

by Becca Savransky, Idaho Statesman

This article was produced for ProPublica’s Local Reporting Network in partnership with the Idaho Statesman. Sign up for Dispatches to get our stories in your inbox every week.

Time and again, the U.S. Department of Education has been the last resort for parents who say the state of Idaho has failed to educate their children. The federal agency in 2023 ordered Idaho to stop blocking some students with learning disabilities, like dyslexia, from special education. That same year, it flagged that the state’s own reviews of districts and charters obscured the fact that just 20% were fully complying with the federal disability law. Last year, it told the state it must end long delays in services for infants and toddlers with disabilities, which could include speech or physical therapy.

Now President Donald Trump has pledged to dismantle the department.

Idaho’s superintendent of public instruction Debbie Critchfield has celebrated the proposal. She insisted that the move would not change the requirement that states provide special education to students who need it. That would take an act of Congress.

But parents and advocates for students with disabilities say they are worried that no one will effectively ensure schools follow special education law.

“Historically, when left to their own devices, states don’t necessarily do the right thing for kids with disabilities and their families,” said Larry Wexler, a former division director at the federal Office of Special Education Programs, who retired last year after decades at the department.

Former federal Education Department employees who worked on special education monitoring said oversight measures would likely be hampered by the layoffs, which included attorneys who worked with the special education office to provide state monitoring reports.

Gregg Corr, a former division director with that office, said that without the group of attorneys who were focused on enforcing special education law, it will be “really difficult for staff to finalize and issue these reports to states.” He added there may also be a reluctance to take on more complicated issues without running them by attorneys.

“What might have been, you know, inconsistent with the legal requirements six months ago may be fine now — it just depends on how it’s interpreted,” Wexler said.

Before Federal Law, Millions Denied Services

For parents who have been fighting for services for years, the federal oversight has been critical.

After Ashley Brittain, an attorney and mom to children with dyslexia, moved to Idaho in 2021, she realized a key problem: Idaho’s criteria for qualifying students with specific learning disabilities such as dyslexia or dysgraphia was so narrow it disqualified some eligible students from receiving services, she said.

Historically, when left to their own devices, states don’t necessarily do the right thing for kids with disabilities and their families.

—Larry Wexler, a former division director at the federal Office of Special Education Programs

Together with Robin Zikmund, the founder of Decoding Dyslexia Idaho who has a son with dyslexia and dysgraphia, Brittain has spent years trying to get the state to acknowledge the disability and provide services to dozens of kids who needed help.

“We’re at the table time and time again, at the eligibility table, where school teams wouldn’t qualify our dyslexic students,” Zikmund previously told the Idaho Statesman and ProPublica. “And it was like, ‘What is going on?’”

Brittain called state officials and told them they were breaking the law. State officials disagreed. No one took action, she said. In 2022, she wrote to the Office of Special Education Programs. In the letter she sent to the federal department, she said the Idaho Department of Education, under former superintendent Sherri Ybarra, was “refusing to entertain any conversations” about changing the way it determined which students were eligible for special education. Ybarra could not be reached for comment.

Before Congress passed what is now known as the Individuals with Disabilities Education Act in 1975 and created the U.S. Department of Education as an agency under the Cabinet about five years later, Brittain would have been on her own.

At the time, nearly 1.8 million students with disabilities weren’t being served by the public schools, according to estimates. Some states had laws prohibiting students with certain disabilities from attending public schools, according to the federal government’s own history.

The law granted students with disabilities access to a “free appropriate public education” — fitting the individual needs of the student — and gave money to states to fulfill the promise. Now, the law also guarantees infants and toddlers with disabilities access to early interventions, such as physical or speech therapy.

The U.S. Department of Education has since been responsible for making sure states follow the law, providing reviews of state performance, distributing money and offering technical assistance to help states improve learning outcomes for students in special education.

The department conducts an annual review of each state, and a more intensive one that’s supposed to be completed roughly every five years. The annual reviews look at discipline numbers, graduation rates and test scores to identify problems and help states to fix them. A five-year review includes a visit to the state and a look at state policies, student data and annual reports. When states need to take corrective action, the federal special education office monitors that they are making the changes.

Idaho is one of about a dozen states currently being monitored, according to the most recent updates on the federal agency’s website.

We’re at the table time and time again, at the eligibility table, where school teams wouldn’t qualify our dyslexic students. And it was like, ‘What is going on?’

—Robin Zikmund, founder of Decoding Dyslexia Idaho

Parent complaints can also trigger a review, as was the case with Brittain in Idaho. After Brittain alleged that the state was wrongfully keeping kids with dyslexia and other disabilities from special education, she waited over a year before she got an answer from the Office of Special Education Programs: She was right. Idaho, it turned out, accepted a lower percentage of students with specific learning disabilities, such as dyslexia, into special education compared to other states — about half the national average, according to the most recent data reported to the U.S. Department of Education from the 2022-2023 school year.

By then, Idaho had a new state superintendent of public instruction, Critchfield, for whom Brittain campaigned. The Office of Special Education Programs told Critchfield in 2023 that the state needed to demonstrate its policies complied with federal law or update them.

In response, the Idaho Department of Education has updated its special education manual, which has since been approved by the Legislature. It has also directed school districts to review every student found ineligible for special education since 2023 to determine if they needed to be reevaluated.

Parents in Idaho celebrated the victory, which could make it easier for some kids to qualify in a state that has one of the lowest percentages of students who receive special education. But they acknowledged the fix wasn’t perfect and left out students who may have been found ineligible for special education before the federal office identified the problem. The state isn’t tracking the number of students who have since qualified due to the change.

Nicole Fuller, a policy manager at the National Center for Learning Disabilities, said a case like this, in which some students are being missed, “truly underscores the need for federal oversight, and, of course, holding states accountable for accurately identifying disabilities.”

Federal oversight isn’t perfect. By the time Idaho addressed Brittain’s complaint, the state had been out of compliance since at least 2015. States that fall out of compliance can be at risk of losing federal funding, although that penalty does not appear to have been used in decades.

The federal government has never fulfilled its promise to fund 40% of each state’s special education costs, but Idaho relied on federal funding for about 18% — around $60 million — of its special education budget during the 2022-2023 school year, state officials said. The rest is made up by the state or by local school districts through referendums. A recent report by an independent Idaho state office estimated special education was underfunded by more than $80 million in 2023.

But U.S. Education Secretary Linda McMahon, appointed by Trump in March, has said that closing the department wouldn’t mean “cutting off funds from those who depend on them” but would eliminate the “bureaucracy” and regulations associated with them.

Critchfield, Idaho’s superintendent, said on Idaho-based The Ranch Podcast that teachers involved in special education spend a lot of time filling out paperwork instead of “focusing on how to help that child be successful.” The changes are about “removing the bureaucracy.”

But Critchfield acknowledged that cuts at the federal level could pose challenges if states have to take on more of an oversight role.

“As much as I am a champion of states doing that, the reality is there would be implications for Idaho and our department,” she said in a statement to the Statesman and ProPublica. The state is looking at what it can do to prepare and “where gaps would exist” should more responsibilities fall to the states.

Zikmund, the advocate who praised Critchfield for being responsive to parents and having an “open-door policy,” said that parents could be better off after the changes with good leadership at the state level, but without it, they could face a “train wreck.”

One test will come in June, when the Office of Special Education Programs is expected to release reports telling states how they performed in their annual reviews. The layoffs and restructuring under Trump are making some advocates question if the federal government will truly hold states to account.

The new documentary Hung Up On A Dream delves into the history of the '60s band The Zombies, including their breakup, reunion and 2019 induction into the Rock & Roll Hall of Fame.The band…

Source

It’s the flip side of Trump’s DEI for incompetent white people.

by Anjeanette Damon and Mollie Simon

ProPublica is a nonprofit newsroom that investigates abuses of power. Sign up to receive our biggest stories as soon as they’re published.

Ronald Carver was skeptical when his investment adviser first tried to sell him on an “ugly houses” investment opportunity eight years ago. But once the Texas retiree heard the details, it seemed like a no-lose situation.

Carver would lend money to Charles Carrier, owner of Dallas-based C&C Residential Properties, a high-producing franchise in the HomeVestors of America house-flipping chain known for its ubiquitous “We Buy Ugly Houses” advertisements. The business would then use the dollars to purchase properties in which Carver would receive an ownership stake securing his investment and an annual return of 9%, paid in monthly installments.

“Worst case, I would end up with a property worth more than what the loan was,” Carver said of the pitch.

Carver started with a $115,000 loan in 2017. And sure enough, the interest payments arrived each month.

He had worked three decades at a nuclear power plant, and retired without a pension and before he could collect Social Security. He and his wife lived off the investment income.

The deal seemed so good, Carver talked his elderly father into investing, starting with $50,000. As the monthly checks arrived as promised, both men increased their investments. By 2024, Carver estimates they had about $700,000 invested with Carrier.

Then, last fall, the checks stopped. The money Carver and his father had invested was gone.

Carrier is accused of orchestrating a yearslong Ponzi scheme, bilking tens of millions of dollars from scores of investors, according to multiple lawsuits and interviews with people who said they lost money. The financial wreckage is strewn across Texas, having swept up both wealthy investors and older people with modest incomes who dug into retirement savings on the advice of the same investment advisor used by Carver.

As early as 2020, Carrier had begun taking out multiple loans on individual properties — some of which he never owned. In cases reviewed by ProPublica, as many as five notes were recorded against a single property, far exceeding the property’s value. Carrier also failed to properly record many deeds that were supposed to secure the loans, accumulating more debt than he could ever repay while investors remained unaware they had no collateral for their investments.

“It’s incalculable the amount of damage this guy did,” said one investor who lost about $1 million and asked not to be named to avoid embarrassment and not to interfere with a criminal investigation into Carrier’s scheme. “He’s ruined some lives.”

Carrier, who declined an interview request, said in a brief phone conversation that he’s not trying to avoid responsibility for the harm he caused. “When this thing finally stopped, it was completely driven by me saying ‘enough’ and going to the people and saying, ‘Here’s the mess I’ve created,’” he said. “This is a mess created by me.”

Investors also blame HomeVestors. For nearly two decades, Carrier used the company’s carefully cultivated brand as the “largest homebuyer in the United States” to gain investors’ trust. They accuse HomeVestors of failing to provide oversight that could have prevented the fraud, despite claiming to hold its franchises accountable for best business practices. In its answers to their lawsuits, HomeVestors has denied responsibility for Carrier’s actions, claiming its franchises are independently operated, despite earning hundreds of thousands of dollars from Carrier’s business.

HomeVestors revoked Carrier’s franchise on Oct. 24, about the time interest payments stopped arriving in investors’ accounts. The company said it had received a tip on its ethics hotline — created in 2023, after ProPublica detailed predatory buying practices by multiple franchises. When confronted by HomeVestors, Carrier admitted that “he and his business had entered into debts that they could not pay,” a HomeVestors spokesperson said. The company reported him to the FBI. In May, HomeVestors filed suit against Carrier for trademark infringement and for not indemnifying it against these lawsuits.

“We take all allegations of misconduct incredibly seriously as demonstrated by our decisive action,” the spokesperson said. “It is truly disheartening for us that anyone who lent Mr. Carrier money was misled or harmed by his alleged fraudulent activity.”

Now, Carrier is under investigation by the Department of Justice, according to a recording of an April call between the lead prosecutor and potential victims. (The FBI and DOJ declined to comment.) A judge in one of the many lawsuits against Carrier has deemed allegations of fraudulent loans to be true because Carrier never answered the complaint. And the investors are in a race with one another to recoup even a small amount of what they lost, by either waiting for the DOJ to pay restitution, suing Carrier or trying to foreclose on properties still left in his portfolio.

Just months after learning they had lost all of their investments, and before any restitution could be paid, Carver’s father died.

Five notes for a property on Glen Forest Lane in Dallas given to investors between 2019 and 2023. Two of the notes were not recorded until 2024. (Obtained, collaged and highlighted by ProPublica) A Top-Performing Franchise

In 2005, Carrier opened a HomeVestors franchise in Dallas, where HomeVestors is headquartered. In the early days, records show, he relied on a handful of institutional lenders to finance his house purchases. Soon, the Wharton School of Business MBA who had come to house-flipping following a career at Pepsi and a food service equipment company, started cultivating his wealthy friends for loans.

Carrier didn’t fit any stereotype of a glad-handing huckster with a bad loan to sell. Those who knew him describe him as a serious person, “cordial but very direct.” He always had files in front of him, constantly focusing on his business. It made him seem trustworthy, one investor said.

At HomeVestors, he was held up as a model franchise operator. C&C Residential Properties routinely made the top volume and top closer lists and was even named franchise of the year. Carrier led training sessions at company conferences and described his business as “the largest and most successful HomeVestors franchise in the United States” — a claim that remained on the website for Carrier’s business through early May.

“Chas Carrier, for maybe 15 years, was one of the golden boys at HomeVestors,” said Ben Ahern, who over two decades worked for a HomeVestors franchise and later owned one before leaving the company in 2021. “Internally, it was like, ‘Do whatever Chas Carrier’s doing.’”

It isn’t unusual for HomeVestors franchises to rely on private investors to finance their house-flipping. Banks aren’t typically interested in house-flipping loans, which are often short-term and riskier than a standard mortgage. Because of that risk, investors who lend to house-flippers earn a substantially higher return.

To further minimize their risk and ensure they had a legitimate ownership stake in the house, savvy investors would verify the transaction with an independent title company to research whether there were other liens against the property and then record the deed with the county recorder. But many of Carrier’s investors, after years of consistent payments led them to trust him, let Carrier handle recording the deeds and did not confirm that he’d done so.

As Carrier grew his business, he began relying more on individual investors. ProPublica identified through public records at least 124 people who have lent money to Carrier since 2009. Not all of them have lost money.

Carrier’s search for new investors was aided by Robert Welborn, an investment adviser in Granbury, Texas, southwest of Dallas. Welborn had built a network of clients in Granbury, a city of about 12,000 people on the Brazos River, through church, friendships and referrals. Many of his clients were older and had modest nest eggs, which Welborn said were “well diversified.” He said he built a relationship with Carrier in 2012, after researching his background for about two months. That Carrier was a successful franchisee lent him credibility, Welborn said.

“I never imagined the No. 1 franchisee with a fast-growing franchise company, HomeVestors,” would defraud investors, he said.

At the time, Welborn also solicited new investors with invitations to steak dinners where they would hear his pitch. An investment in Carrier’s business, according to Welborn’s sales material, which also featured the HomeVestors caveman mascot, Ug, was both lucrative and secure. “Your investment is protected,” the sales material assured potential clients.

For loans he sent Carrier’s way, Welborn earned a 2% commission, he said. Welborn had at least two dozen clients who invested with Carrier, most of whom had multiple loans to him, according to a public records search. He would not comment on how many of his clients invested with Carrier.

Many investors were happy for years — in some cases, more than a decade. The interest payments came in like clockwork. A lot of Welborns’ clients relied on the payments for retirement income.

“I was real tickled with it,” said Tom Walls, 85, who said he lost $50,000 of his retirement savings by investing with Carrier.

Some investors noticed small problems — a payment that arrived a few days late or an error on the paperwork to secure the loan. But Carrier always fixed the problems promptly, investors said.

“When you have this 10-year continuous, pleasant and mutually beneficial relationship, you build up a great deal of trust,” said John Moses, who estimates he lost more than $1 million to Carrier.

Looking back, the investors who spoke with ProPublica said they wished they had taken those warning signs more seriously.

(Max Erwin for ProPublica) “He Just Pencil Whipped Those Deeds”

By fall 2024, Carrier’s payments to his lenders stopped. That’s when the house of cards fell.

Carrier had spent that summer scrambling for money. Not only did Carrier have to make loan payments to scores of investors, but he also needed to keep up with the HomeVestors franchise fees and advertising payments. The company requires its franchises to make regular reports on sales and to open their books for audits, to provide financial statements when requested, and to report all assets and liabilities. Any of those reports could have called into question Carrier’s ability to stay solvent. But, according to former franchise owners and employees, HomeVestors’ audits of its franchises are mostly geared toward ensuring they’re paying all their franchise fees, which are based on sales.

Before Carrier’s tangle of fraudulent loans collapsed and was exposed in court, there were signs of trouble.

In 2016, Carrier was fined by the Texas Real Estate Commission for managing properties without a license. The HomeVestors franchise agreement requires owners to follow all laws and regulations, particularly real estate regulations. In 2020, two title insurance companies issued special alerts on Carrier’s business, advising their title officers not to enter into transactions with him without further legal and underwriting review. Carrier hasn’t paid taxes on some of his properties since early 2023, according to court and public records, another violation of his franchise agreement. Despite the apparent violations, HomeVestors didn’t terminate Carrier’s franchise agreement.

“I don’t really think they do have much in place to prevent something like this,” Ahern, the former HomeVestors franchise owner, said of the company. “HomeVestors at the time didn’t seem to have an internal system policing how franchises finance buying properties.”

A HomeVestors spokesperson said the company focuses on its franchise customers’ experiences selling their homes and does not “dictate” how franchises raise capital. “The more than 950 franchises of HomeVestors are independent businesses with a wide variety of finance options available to them,” the spokesperson said.

Last spring, Carrier began borrowing against his future receipts in exchange for cash advances with exorbitant fees and annualized interest rates that he later claimed ranged as high as 600%. Between May and October, he did this at least seven times, racking up more than $1.2 million in debt beyond what he owed his investors, exhibits included with court filings show. By fall, he owed more than $75,000 in payments a week, according to the original terms. Seven companies filed suit over the cash-advance agreements, accusing him of default. Carrier has denied the allegations of default and has countersued four of the companies, claiming he was charged unreasonably high interest rates.

The lending scheme appears to have fallen in a gray area for state and federal securities regulations. It’s unclear whether the promissory notes Carrier issued to investors meet the definition of a security, two experts told ProPublica.

In October, Carrier’s investors began to confront him about the missing payments, including Jeff Daly and Steve Needham, two of Carrier’s largest investors who had been lending him money for years. Carrier came clean to Daly, admitting he had been running a lending scheme for “several” years, according to a lawsuit Daly and Needham filed. He told Needham he had taken out multiple loans on individual properties without disclosing them to the investors, according to the lawsuit. The two men claimed in their lawsuit, which resulted in default judgments against Carrier, that combined they had lost $13.5 million to Carrier.

The investor who spoke to ProPublica and asked not to be named said in an interview that Carrier broke down in tears when confronted about losing more than $1 million of the investor’s money. Carrier admitted the loans paid for his operating expenses, not for buying and refurbishing houses, the investor said.

“He just pencil whipped those deeds at the end,” the investor said, explaining that Carrier drew up documents but didn’t record them. Because the deeds were never recorded, the investor had no lien on the properties and therefore no collateral. Some deeds were for houses that Carrier didn’t own or never bought, the investor said. “It was a complete fabrication.”

Welborn’s clients, who typically invested much smaller amounts with Carrier, also learned of the house-flipper’s collapse in the fall, when their payments stopped. Carver said that Welborn called him a couple of days after the October payment was due and said, “Hey, I’m sorry to tell you this, but Chas has called me and admitted to fraud.”

Carver said he got in the car and drove to Welborn’s office, where he learned the nightmarish truth that all the money Carrier had taken was gone.

“A Life-Changing Hit”

Investors are deploying a variety of strategies to get their money back — some of which pit bigger investors against smaller ones and early investors against more recent ones. Those who acted quickly are recovering some money through foreclosures and lawsuit settlements. Although Carrier is denying allegations in lawsuits brought by the cash-advance companies, he’s not fighting individual investors who are suing him. Three of their lawsuits have resulted in judgments against Carrier, and he has so far not defended himself against the others.

Welborn said he’s doing his best to help his clients recover their money by providing the necessary paperwork, connecting them with buyers for the houses used as collateral and researching lien histories on the homes. When he first learned of the scheme, Welborn tried to convince his clients to sign on with his lawyer to sue Carrier. The lawyer, Anthony Cuesta, hoped a court would seize Carrier’s assets to help recover the investors’ lost funds. But he quickly learned there were too many investors and not enough equity in the properties to fund the litigation. Now, many of Welborn’s clients are waiting for the FBI and DOJ to act, while wealthier investors are foreclosing on properties and making them ineligible to be used for restitution. Welborn said some of his clients have been paid restitution through a DOJ-appointed real estate agent’s sale of Carrier’s properties, but he declined to provide details.

Carver isn’t optimistic: “We are not going to get a dime.”

At least one investor went after Welborn individually. According to a Securities and Exchange Commission disclosure, the claim was settled for $130,000. In his response to the SEC disclosure, Welborn denied breaching fiduciary duty to the client and said he “resolved the claim to avoid controversy.” Welborn told ProPublica that $120,000 of the settlement came from the sale of the house used as collateral for the family’s loan and he paid $10,000 for their attorney fees.

Welborn said he’s “devastated” by the loss of his clients’ money. “But every day I drag myself to work with God’s help and spend most of my day helping lenders with their own personal restitution battles,” he said.

Some investors said they will have to go back to work after having retired or are scrambling to find some way to replace their lost income.

Carver wishes he had paid more attention to red flags, like paperwork errors. But the monthly checks were so reliable, he didn’t listen to his gut. Or his wife.

“Every time I added money, my wife would say, ‘Don’t do it,’” Carver said. “My mother, too. She would push on my dad not to add any more. But he liked getting the monthly check.”

Carver’s dad, Larry, believed it was the best performing investment he had ever made. When the money disappeared, Carver went to work trying to recoup some of it. Maybe he could write it off on his taxes, he thought. He wanted to get at least something back for his dad. But Larry was in ill health, and in February, he died.

“My dad passed thinking he lost all of his money to this guy,” Carver said, adding he hopes Carrier “goes to jail for a very long time.”

The investor who asked not to be named said the loss was “a life-changing hit.” He had retired at 53, after sticking it out in a job he hated until his stock options vested. When he finally quit, he put the money into Carrier’s business and lived off of the monthly payments. He may have to go back to work.

“He was an arrogant son of a bitch,” the investor said. “It was gone before he told anyone there was a problem. That’s the unforgivable piece. He squandered it all away. And he had to get backed into a corner before he admitted it was all gone.”

Byard Duncan contributed reporting.