A bad situation is getting worse for the linked real estate companies behind dozens of the ugly all-burgundy and and all-black painted brick rehabs in St. Louis. The companies were previously accused of operating like a Ponzi scheme in New York federal court. Now Van Barker and his Lighthouse Estates are in trouble in Kentucky and Indiana as well, as attorneys there filed a class action lawsuit on behalf of 125 investors who say they lost $24 million when Barker’s scheme collapsed late last year.
The rehabs angered St. Louis residents, who noted not just their ugly exteriors (garish paint and too-small windows were signature looks) but also the unpermitted work being done at all hours of the night. City inspectors who tried to stop the work found it quickly turned into a game of Whac-A-Mole.
The attorney who filed the class action suit, Alexander Loftus, is asking a judge to appoint a receiver to take control of the companies’ 270 properties across Indiana and Kentucky. Loftus says that Lighthouse and the affiliated company Starpoint have been moving cash overseas to accounts in the Philippines and Thailand; a receiver would prevent further properties from being liquidated and the cash moved out of the reach of creditors…