(INDIANAPOLIS) – Attorney General Curtis Hill today alleged that several companies and people – including a former “Fox & Friends” host – perpetrated a years-long real-estate scheme and defrauded dozens of would-be investors.
Victims of the scheme took possession of dilapidated properties they believed were in better shape and paid for services that were never provided. In the end, they lost thousands of dollars, Attorney General Hill said.
A civil complaint alleges that Clayton Morris, Bert Whalen and Natalie Bastin – along with their associated companies – violated the Indiana Deceptive Consumer Sales Act and the Home Loan Practices Act. The complaint seeks injunctive relief, civil penalties and consumer restitution where possible.
Morris, who worked for Fox News as a radio and TV host until 2017, was integral to the scheme, according to the complaint. Morris promised consumers simple, ready-to-rent “turnkey” properties that would deliver a significant return on investment. He used his popularity to lure consumers into the scheme and advertised his services as an opportunity to make money through “passive income,” the complaint says.
The consumers, many of whom were from outside of Indiana, were promised an easy path to financial freedom. But the reality was much different.
Instead, many consumers were given rental properties that were dilapidated, cited by local health officials, and uninhabitable. Many did not receive services for which they paid. And many sold their homes at a loss or are trying to salvage any remaining value they have.
“Dozens of consumers were promised a path to financial flourishing, but that promise was broken,” Attorney General Hill said. “These defendants raked in money as they knowingly caused eager home-buyers to suffer. We will hold them accountable for their unconscionable and predatory behavior.”
Morris worked closely with Whalen and his related entities, who ensured that Morris had enough properties to provide consumers who were enticed into their deception.
The Marion County Health Department and the Indianapolis Department of Business and Neighborhood Services assessed at least 138 violations to the subject properties because the defendants did not properly renovate, rehabilitate and/or maintain them. This left consumers unable to lease or sell the properties.
In one instance, a property on the east side of Indianapolis was cited due to moldy walls, electrical outlets that did not function properly, and the kitchen sink not being connected to an appropriate drainage and sewer system.
More than 150 properties were implicated in this scheme, impacting transactions with at least 94 consumers. The Office of the Attorney General received more than 120 consumer complaints in connection with the properties.
“Our goal is to help the consumers who fell victim to the defendants’ fraudulent actions,” Attorney General Hill said. “We are requesting that the court order the defendants to pay restitution to their victims. We hope this money will help them regain their financial footing.”
A copy of the civil complaint is attached.