• Georgetown Times
  • Waccamaw Times
  • Inlet Outlook

Sen. Cleary to appeal court decision in loan fraud lawsuit

  • Wednesday, November 13, 2013

  • Updated Wednesday, November 20, 2013 9:53 am

Sen. Ray Cleary, a Murrells Inlet resident and dentist who represents portions of Georgetown and Horry counties in the S.C. Senate, said he will appeal a recent Horry County jury decision about a loan fraud lawsuit.
Last Thursday, a jury sided with Beach First, a bank for which Cleary was the board chairman, saying that the bank did not defraud him in a $3 million property loan and that Cleary was to blame for the loan’s default.
Cleary said the decision hinged on an appraisal that the bank ordered, which stated that the property — located on S.C. Highway 90 at Mt. Zion Road near Little River in Horry County — consisted of 160 acres of vacant land with 121 acres of upland and 39 acres of wetlands.
“A year later, they found that it only had 50 acres of dry land,” Cleary said. “The appraisal was off by about 67 percent. The bank ordered the appraiser that I had to pay for.”
When Cleary went back to the bank after finding out he was paying for land that was not worth what he was paying, bank officials told him he should have had his own appraisal done and that he was negligent for not doing so.
“I never heard a bank say that,” Cleary said.
He said Beach First Bank should have sued the appraiser because they did a fraudulent appraisal.
A lawyer for Bank of North Carolina said Cleary was caught up in the real estate boom and blamed the bank when development plans fell through.
Cleary compared the situation to buying a three carrot diamond ring appraised at $20,000 with a loan, only to find out you have bought a Cubic Zirconia.
“Now you are making $500 payments on a ring that is not worth $20,000,” he said.
Cleary said the lawyers for the other side made the case that he was a politician and dentist with an income in the high six figures.
“They painted me as a rich guy and the jury made an emotional decision,” Cleary said.

The Associated Press contributed to this story.

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