I got a really interesting note this weekend from a reader who’d just come across our investigation about a post-boom real estate scam affecting scores of properties in San Diego and California.
Greg Knoblich said he “read with interest” about Jim McConville. He gave me permission to share his letter here:
I lost approx 200K in the early 1990’s because of him. He was a trusted friend as he was best friends w/ my older brother in junior high school as they were on the swim team together … in San Leandro. He also took my sister to her Sr. Ball.
Jim taught me how to buy fixer uppers in Oakland. He took me under his wing. I spent extensive time w/ him and his family when they lived in Newark. We purchased 37 units together in Oak. I put up all the down payment and he paid for the rehab.
The long of the short of it is I gave the properties to Jim and took a note back. He paid for a few months and then he stopped and would not return phone calls. The economy had took a downward spiral approx in 1992. He owned over 60 properties in Oakland and Richmond. He was heavily leveraged and his empire came crushing down. There were many who tried to sue him. I never recovered a dime and was told there was no equity left in his props. I understood he lost it all, or most.
My maintenance man saw him a few times after that at Home Depot in Emeryville. He was back doing what he always did, buying and rehabbing. When I knew him he would consistently work 14-16 hour days. I was always shocked by the way he treated me in the end. I really did feel like he was family.
A friend tipped me off this morning that she heard that there was a news story about him. This prompted me to Google him and thus this letter to you.
I could hardly believe what I was reading. I guess I was just a warm up for what was to eventually happen to these other folks. He looks the same only 17 years older.
He still has that same foo man choo (sic) mustache & beard.
I hope he ends up in jail for good. His own greed has put him where he is now.
I asked Knoblich if his experience was enough to turn him off of real estate investing, but he said he’s still using what McConville taught him. He shod horses for nearly three decades and funneled all of his earnings into buying real estate. When Knoblich had a spinal cord injury in a skiing accident a few years ago, he fell back on real estate investing, rehab and maintenance.
I am still investing. Even after the dollars lost from McConville he still ingrained in me the way to make money in R.E. (real estate). …
So even though he screwed me over, I still think I’m ahead of the game because of what he taught/showed me and how he did it. I just needed to put into action his lessons, which I did.