Developer Consents to Fraud Case Judgment

Former Huntington Beach developer Harold E. Tobin consented to a $3.75-million judgment in a securities fraud lawsuit, federal regulators said Wednesday. But he won’t be paying any money back.

The repayment was waived based on sworn statements that Tobin, 57, now of Rancho Mirage, is broke, according to the Securities and Exchange Commission, which brought the lawsuit.

The judgment, however, orders him not to violate securities registration and anti-fraud provisions of securities laws.

Tobin used his Tobin Investment Corp. in Huntington Beach to raise millions of dollars for various real estate projects. He paid investors at interest rates that reached 25%, though most were about 15%.

When he closed its doors in February 1995, he had raised as much as $60 million from 312 individuals by selling lots in five Southern California projects and two Las Vegas developments.

The SEC sued over one of the projects, for which Tobin raised nearly $5 million from mostly elderly investors nationwide in late 1994. The money funded a Las Vegas residential real estate project called Rancho Mirage, apparently named after the California city.

But the project was never developed and remains raw land today. Most of the money raised was used to pay development costs of other projects, to pay interest to investors in Rancho Mirage and other projects and to pay undisclosed commissions and other payments, according to the SEC.

Tobin did not admit any wrongdoing in consenting to the judgment.

He still faces at least two lawsuits in Orange County. One seeks about $35 million in damages on behalf of more than 50 plaintiffs who invested a total of about $15 million.

Other investors, though, have foreclosed on the land or are trying to sell the lots to other builders.

“You can’t get blood out of a turnip,” said Jim Shields of Laguna Niguel, who has been working with other investors to sell their lots to builders. “I just want to see the S.O.B. behind bars.”

SEC lawyers would not comment on whether they had referred the case to the FBI. But Tobin’s lawyer, Donald Segretti of Newport Beach, has said that his client expects to be indicted.

Segretti has blamed the real estate recession of the early 1990s for the collapse of Tobin’s company. He said Tobin did not intentionally do anything wrong.

Tobin’s wife, Carolyn, said in an interview earlier this year that her husband, a former USC fullback, was a “naive, gullible guy” who was “very honest, trustworthy,” and relied on three builders and some “bad advice.”

While she works as a real estate broker, she said, her husband has been working on ways to recover some money for investors.