Muslim bakery family linked to real estate broker accused of fraud
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Did real estate fraud help build Your Black Muslim Bakery into an enterprise worth killing for?
By Thomas Peele, Josh Richman, A.C. Thompson, G.W. Schulz, Bob Butler, Lisa Pickoff-White, Robert Lewis, Nick Kusnetz, Vianna Risa Davila, Marnette Federis and Lucie Schwartz, Chauncey Bailey Project
real estate broker with ties to Oakland’s Bey family and her husband have, since 2003, acquired nearly $2 million worth of East Bay properties through a string of deals tainted with allegations of deceit.
The revelations about Esperanza Johnson and Antron Thurman come as authorities scrutinize the extensive real estate dealings of the Bey family and their bankrupt Your Black Muslim Bakery, including Johnson’s role as the broker for an Oakland woman attempting to buy the bakery’s headquarters.
Johnson bore four of family patriarch Yusuf Ali Bey’s dozens of children.
Audio: Broker associated with bakery accused of deceit
Audio slideshow by Karl Mondon: Donald Taylor laments real estate deal with Antron Thurman
Audio slideshow by Karl Mondon: Couple accuses Esperanza Johnson of fraud
Video: Real estate questions
A broad array of people and groups have tangled with Johnson and Thurman in court, including a disabled Berkeley bus porter forced from his family home, an Antioch couple now facing foreclosure, and East Bay Habitat for Humanity, a nonprofit organization that builds homes for the poor and struggling.
Combined, they claim to have lost at least $1.77 million in property, cash and equity in the deals, according to an investigation by the Chauncey Bailey Project.
Johnson and Thurman have not been charged with crimes in the cases. But criminal investigations swirl around the bakery.
Its CEO, Yusuf Ali Bey IV, 21, jailed without bail on kidnapping and torture charges, is also charged with real estate fraud: prosecutors say he bought an Oakland property under a false identity. Bey IV is the son of Daulet Bey, whom bankruptcy trustee Tevis Thompson has sued for the return of $2.28 million in bakery properties transferred to her in what he deems a bid to “defraud creditors.”
The bakery’s tangled affairs may have played a role in the Aug. 2 shotgun slaying of Oakland Post editor Chauncey Bailey. Police say Devaughndre Broussard, a 20-year-old bakery associate, said he shot Bailey because the journalist was working on a story about the bakery’s finances and bankruptcy. Broussard later recanted his confession.
The judge handling that bankruptcy case should consider Johnson’s record, according to a Los Angeles real estate consultant who reviewed Johnson’s transactions for the Chauncey Bailey Project.
“They should be made aware that a Realtor on a transaction which requires the trustee’s approval has a murky background,” said Eric Forster.
The attorney for the court-appointed bankruptcy trustee charged with liquidating the bakery said Johnson’s transaction history would be probed.
“Obviously it is of some concern to us and we’re looking into it,” said Eric Nyberg, attorney for trustee Thompson.
He also noted that Johnson’s client, Paulette Arbuckle, may not, in the end, be the highest bidder for the bakery. A hearing on Arbuckle’s $899,999 bid is scheduled for Nov. 29. If Arbuckle is successful and Johnson is “entitled to receive the commission, then we really don’t have an issue with it.” A spokesman for the state Department of Real Estate, Tom Pool, wouldn’t discuss Johnson and Thurman’s transactions.
Johnson, whose state business registration was suspended more than a year ago for failure to pay taxes and who, combined with Thurman, has more than $1 million in state and federal tax liens recorded against them, didn’t return numerous telephone calls and e-mails. She also didn’t answer the gate at her Antioch home on two recent occasions.
Thurman refused to speak to reporters who approached him recently in Oakland and Tuesday in Antioch about various cases in which he or Johnson or both have been accused of fraud.
4821 Valley Way, Antioch: Couple files lawsuit
Markus Machado and Gail Mateo said that when they wanted to buy a newer and bigger home in 2005, they went to a real estate broker they thought they could trust: Esperanza Johnson.
A Compton native, Johnson, 52, became involved with the Bey organization, a spin-off of the Nation of Islam, at the age of 12, taking the name Noor Jehan Bey, a name she said in 2005 testimony she sometimes still uses.
But she mostly goes by the name Esperanza Johnson, though she has been listed in judgments against her by banks and credit card companies as Nellie Bey, Nuri Bey, Noojean Bey and Noor Jehan Esperanza, a review of records by the Chauncey Bailey Project shows.
Johnson had hired Machado, a graphic artist, to create fliers for Signature One Mortgage and Real Estate.
In a recent interview at his lawyer’s office, Machado described her as warm and gregarious — at first, anyway. Machado said Johnson arranged what seemed like an incredible deal: the couple could sell their 50-year-old Pittsburg house and move into a spacious four-bedroom home in an Antioch subdivision, an ideal place to raise their three children and grow old together.
Johnson promised they would pay about $1,600 a month for the new home, only a little more than their mortgage at the time, Machado said Johnson even agreed to forgo her usual commissions because “we were like family.” They said Johnson had told them their credit was poor, and talked them into selling their Pittsburg house to one of her employees, Araceli Moreno, for $350,000 while putting the new home and mortgage in Moreno’s name. They expected to refinance the loan in about a year, when Moreno would sign the house over to them.
After paying off what they owed on the Pittsburg house, they said they believed about $190,000 would remain for the down payment on the Antioch house.
It seemed perfect — until the bills arrived.
The payments were $2,700 a month and soon ballooned higher, they now say in court records.
That was because, the lawsuit alleges, only $77,793 actually went toward a down payment.
Johnson, the suit alleges, had diverted almost $58,000 of equity from their old home to others, including someone named Harry Hawkins who allegedly received $45,830 as repayment of loans. Machado’s lawyer, Ken Koenen, said attempts to locate Hawkins have been fruitless. Reporters also could not locate Hawkins.
Johnson received $40,712 in commissions, the suit alleges. Court records say Johnson also arranged for another $10,000 to be paid out to Moreno.
The couple almost immediately had trouble making the payments, and Moreno began receiving calls from the mortgage company. She sued Machado and Mateo last year.
“The point of (Moreno’s) lawsuit was to get them to refinance to get my client’s name off the loan and for her to go ahead and salvage what of her credit picture she could,” said Moreno’s attorney, Richard G. Hyppa of Tracy.
The couple counter-sued in November 2006, naming Moreno and Johnson as defendants, claiming that Johnson defrauded them. They are now months behind on the payments and stressed to exhaustion.
“I don’t sleep. Gail doesn’t sleep,” Machado said. “I was very naive. We were led down this primrose path because I trusted (Johnson) implicitly.”
The suit also claims Johnson structured the Antioch mortgage so monthly payments would increase dramatically after a year, and so Machado and Mateo would have to pay an $18,000 penalty in order to refinance — thereby earning her a much larger commission.
Machado and Mateo now are several months in arrears on the mortgage in Moreno’s name. Default notices have arrived at the house.
“It’s an extremely painful thing,” Machado said. “We have been robbed of our peace of mind. We have to make decisions about whether to put food in the refrigerator or gas in the car. We’re not even sure we’re going to have a place to live.”
Johnson hasn’t responded to the couple’s lawsuit and will likely be subject to a default judgment, Koenen said.
118 Ironwood Court, Hercules: Complicated investment
Johnson and Thurman in 2004 acquired a Hercules home after a federal judge had ordered it frozen as an asset of an investment company, Chicago D&P, that the U.S. Securities and Exchange Commission had accused of fraud.
The property was supposed to be sold to help pay back investors — reportedly including at least 30 active-duty Marines and several churches — which had been cheated out of millions through Chicago D&P’s pyramid schemes.
The daughter of the company’s president had bought the property years earlier using a straw purchaser — a friend with better credit — as a front, according to court records.
That friend had been trying to get her name off the title for some time, and the daughter’s attorney — Githaiga Ramsey, who also worked for Thurman and Johnson on another case — persuaded her to sign the house over to them. Records shows Ramsey offered the friend $20,500 to complete the transaction but that the payment was never made.
The transfer of the house occurred June 16, 2004, weeks after U.S. District Court Judge Charles Breyer had ordered the property frozen. Thurman then sold it two months later to one of the employees of his bail bond business, Jamie Bonilla, for $460,000. Johnson filed Bonilla’s loan application.
Most of that money appears to have eventually gone to pay mortgages on the property when Thurman and Johnson acquired it for free. But first, Thurman received $60,213 from the deal’s escrow; Ramsey got $31,000.
It remains unclear who lived in the house after Bonilla bought it from Thurman Aug. 27, 2004.
Stephen Anderson, the receiver representing Chicago D&P’s bilked investors, wrote in April 2005 that he believed Johnson’s daughter, Nisa Bey, had lived there.
Other documents show Madeeah Bey — another mother to several of patriarch Yusuf Bey’s children — used it as her mailing address in two December 2004 real-estate deals.
It’s also unclear whether Thurman and Johnson knew of the court order freezing the house when they took possession of it. But in February 2005 Breyer held Ramsey in contempt of court for defying his order.
Ramsey and Thurman both repaid the money they received from the escrow when Thurman sold the house to Bonilla.
Bonilla, within a few months, then sold the house for $625,000 — a profit of $211,690 from a property which the receiver had originally wanted to sell to help repay the defrauded investors.
Anderson said a long legal battle to regain title to the house would’ve been too costly.
“We made an economic decision,” he said. “The objective of the receiver is to return as much money as possible back to the investors, and it was not difficult to determine we were going to get more money by taking the $91,000 from Thurman and Ramsey than by trying to unscramble that whole mess.” Ramsey, who surrendered his law license while facing disciplinary charges in an unrelated case, wouldn’t discuss this case or others in which he was involved with Johnson and Thurman.
“My God, am I never going to get away from this?” he said. “I’m not involved and I don’t want to be. I’m not in contact with these people anymore.”
Bonilla could not be located.
360 105th Ave., Oakland: Habitat for Humanity home
Antron Thurman married a woman named Sharon Clements in December 1987. Records show they separated after seven months and later filed for a divorce that was never made final.
In early 2000, Clements, as a single mother, moved into a home on 105th Avenue in Oakland built by the low income housing group East Bay Habitat for Humanity. It gave Clements a no-interest $112,000 loan with no down payment.
Clements died in April 2003, leaving no will. Usually either there’s a clear legal inheritance, or else the nonprofit passes the deed to someone qualified for low-income aid, Executive Director Janice Jensen said. But Clements’ son was still a minor.
Clements’ home stood vacant for three years while her estate was sorted out in Alameda County Probate Court.
Then, in mid-2006, Thurman argued he was entitled to the low-income property as Clements’ surviving spouse, records show — even though he listed his address as Johnson’s Antioch home, and other records showed that in the previous few years he had bought and sold in excess of
$1 million in East Bay real estate.
“Frankly, I didn’t even know about Mr. Thurman,” Habitat’s Jensen said. “I had no idea who he was or that he even existed until the attorneys got involved. When we looked at the deed, she was the only signature, so she bought that home herself.”
Still, Alameda County Superior Court Judge Marshall L. Whitley awarded Thurman the house, which had restrictions in place to preserve its affordability for low income people.
Thurman sold it back to Habitat for Humanity for the $13,500 in equity that had accrued during the three years Clements owned it.
Alana Conner, an attorney for Thurman at the time, said she couldn’t independently recall details of the case and declined to discuss it.
1565 77th Ave., Oakland: A home lost
Mitzie Peters befriended Brandy Stewart in 2001, studying the Bible with her eventual victim, court records say.
Peters persuaded the cash-strapped AC Transit bus driver to deed the home at 1565 77th Ave. — which Stewart had inherited from her mother, and in which she, her husband and her three children lived — into Peters’ name and use Peters’ credit to get an equity loan. Peters promised to return the deed after a few days, keeping $12,000 from the loan as a fee.
“She said that because she loved me so much, she would never, ever think about doing this for anyone else, but she would help me to get the house refinanced,” Stewart would later testify.
Stewart deeded the house to Peters on March 11, 2003. But rather than sticking to the deal, Peters drained the property of all equity and gave nothing to Stewart, court records show.
Peters couldn’t have conducted the transaction without Johnson and her family.
As Peters’ broker, Johnson submitted a series of loan applications reporting Peters’ income as increasingly higher until the bank accepted the deal; she also allegedly coached Stewart in writing to the title company and falsely claiming Peters was her cousin, according to court documents.
Johnson’s sister, Ruquayya Jasmine Pennix, prepared Peters’ tax returns to send to the loan company, showing self-employment income Peters later admitted was bogus; it’s unclear if Pennix knew that at the time.
Another of Johnson’s sisters — Fatima Ismail, working in Johnson’s office — drew up a phony lease showing Peters had derived rental income from Stewart’s house, according to court records.
Three months after she took title of Stewart’s house, Peters sold it to one of Johnson’s sons, Amir Bey, for $325,000, according to documents. Amir Bey later admitted under oath he was just a straw buyer for his mother.
When arrested and charged with unrelated public benefits fraud, perjury and grand theft in July 2004, Peters made bail with Thurman’s Sinbad Bail Bonds.
As investigators also began probing her real-estate activities, Peters gifted her Hayward condo, where she was living, to Johnson’s daughter, Nisa Bey, who sold it a month later for about $400,000. Peters then lived with Nisa Bey in Pittsburg until she went to prison. Nisa Bey could not be reached for comment.
Because her bail had been secured with the condo, Thurman later asked a judge to exonerate the bail and return more than $50,000 — to Nisa Bey.
The Alameda County District Attorney’s office interviewed Johnson, Thurman, and their attorney, Ramsey — who had represented Peters until just two months earlier, and who had just arranged the Chicago D&P deal for them — in September 2004.
“Johnson seemed evasive when questioned about irregularities in the loan and application process,” inspector Paul Wallace wrote in court papers.
But Johnson wasn’t charged.
“We didn’t think we could prove the case against her beyond a reasonable doubt,” Deputy District Attorney Alyce Sandbach said. “We didn’t have enough to make her on a case of fraud … of having made knowing misrepresentations.” Among additional charges filed against Peters in November 2004 was a felony grand-theft count for equity and title to the Stewarts’ home; she pleaded no contest to that and 15 other, unrelated counts a year later, and in February 2006 was sentenced to five years in state prison.
Shortly after acquiring the property, Amir Bey and Johnson tried to evict the Stewarts, court documents show, but backed off when the couple obtained free legal help.
The Stewarts then sued Johnson, Peters and Amir Bey; Johnson eventually offered to deed the house back to the Stewarts, but with the equity drained, they couldn’t afford the higher mortgage payments.
The Stewarts got the $50,374.10 bail money Thurman had tried to direct to Nisa Bey. A judge in January ordered Peters to pay $486,083.90 in the Stewarts’ civil lawsuit, but they haven’t seen a dime, their lawyers said.
A judge in September 2006 ordered Johnson and Amir Bey to pay the Stewarts $100,000 — $20,000 up front and $1,667 per month for 48 months.
But that civil judgment became a lien on the house that was subordinated to mortgages that Amir Bey had taken on the property and eventually defaulted on, said Rebecca Saelao, the Stewarts’ attorney. The house was sold at auction last year for $80,900, according to records.
The Stewarts got only about $5,000 from the sale of the home they’d lost. They no longer live in the Bay Area, and couldn’t be reached for comment.
1421 Northside Ave., Berkeley: ‘There’s nothing I can do.’
Wrapped in a thin, sea-green blanket, Donald Taylor lay in a narrow bed at a Stockton nursing home two weeks ago, his frail 61-year-old body ravaged by diabetes and hypertension. His wheelchair was parked at his bedside, a walker he wants to learn to use a few feet away.
Taylor is broke and relies on Medi-Cal, the state insurance program for the indigent, to bankroll his care and board at the Elm Haven Care Center. His room is dingy and fluorescent-lit with peeling blue wallpaper and a television, foil wrapped around its rabbit-ear antennae, issuing forth static-filled sound.
“He spends his days just doing nothing,” Taylor said. “He said he wonders what his life might be like now if he never encountered Antron Thurman.”
“I think about it quite often, but there’s nothing I can do … I think about how they took the house from me,” Taylor said haltingly in a soft, gravelly voice that contained little emotion.
In the 1950s Taylor’s parents bought a cozy two-bedroom home on a tree-shaded street in north Berkeley.
He grew up there and lived there still as an adult, while working as a bus-station porter. When his parents died, he and his sister, Loretta Alexander, inherited the house; the mortgage was paid off.
In early 2001, according to interviews and court documents, stepbrother Frederick Myers Jr., approached the siblings with a plan: He would help them form a company to manage the house and another property they had inherited, an undeveloped Lake County parcel. Myers asked them to transfer the two deeds to the new corporation, which he would run for them.
Taylor said he agreed at his sister’s urging, believing the three of them could profit from development of the Lake County parcel.
But in 2003 Myers sold the Berkeley house to Thurman, pocketed hundreds of thousands of dollars and disappeared, court documents state, catching Taylor and Alexander completely off guard.
“I felt I had been cheated,” Taylor said, adding he believes Thurman and Myers worked in concert. “Fred Jr. took the house and sold it to (Thurman) and it’s been downhill ever since. He sold it out from underneath us.”
Myers could not be located. When reporters approached Thurman in Oakland and asked whether he remembered Taylor, he refused to answer as he climbed into a Cadillac Escalade.
Alexander’s son, Tony Cole, expressed disgust at the way his mother and uncle were played.
“That property slipped right out from underneath them,” he said in a phone interview. “They didn’t have the business sense to know what was going on.”
Taylor and Alexander in 2004 sued to reclaim the house. Myers never appeared in court, but Thurman — represented by Githaiga Ramsey — responded by filing his own suit, claiming he had legitimately bought the property for $374,388 and demanding that Taylor pay $1,500 in monthly rent or get out.
Taylor and Alexander eventually settled the case for $55,000; it took Thurman 10 months to pay them, court records indicate. Taylor’s attorney, Frederic Harvey, refused to discuss the case.
The two-story, beige stucco house with a large garage has steadily appreciated in value.
Public records show Thurman sold it in 2004 to Madeeah Bey — the same relative who used the Chicago D&P house in Hercules as her address — for $520,000; she sold it for $850,000 less than a year later. The house is now assessed at $867,000.
Alexander died last year. Taylor lost most of his possessions — including his photos of his mother when he left the property.
“I’d like to tell him to go (screw) himself,” Taylor said of Thurman, his legs twitching under the blanket.
Thomas Peele is an investigative reporter and Josh Richman is a staff writer for the Bay Area News Group; A.C. Thompson is a freelance reporter working for New America Media and Bay Area News Group; G.W. Schulz is a staff writer for the San Francisco Bay Guardian; Bob Butler is a freelance reporter and president of the Bay Area Black Journalists Association.
Reach Peele at email@example.com and Richman at firstname.lastname@example.org.