JACKSON–A federal district court judge ruled Tuesday (June 1) that Charles Evans Jr. would stay in jail until his next hearing on felony charges. Evans has been accused of resisting arrest by U.S. Marshals when he was taken in to custody last Wednesday. He was also in possession of a firearm.
Evans, along with his brother Chris Evans were sued in September for orchestrating a commercial real estate mortgage-stacking scheme that defrauded Mississippi Valley Title Insurance Company (MVT) and more than 30 Mississippi banks. Claims have been filed for $40 million. An MVT lawyer has said the damage may be as much as $80 million.
Assistant U.S. District Attorney Mike Hurst said Evans must be indicted within the next 30 days.
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May 28 – Breaking News: Charles Evans Jr. walked in to a 2 p.m. federal district court hearing today in Jackson wearing an orange jumpsuit with “MADISON COUNTY DETENTION CENTER” on the back. Evans, 56, thin and more than 6 feet tall with unkempt gray hair, wore a vacant look and nervously fidgeted with his chains.
Creditors from more than 30 Mississippi banks have been wondering where Evans has been since September, when the alleged mortgage-stacking scheme he perpetrated with his brother Chris Evans crashed. The Evans brothers obtained more than $40 million in fraudulent loans for commercial real estate development on properties in Madison, Harrison and DeSoto counties. Activities began as early as 2003.
Charles Evans Jr. has refused to appear in federal bankruptcy court on numerous occasions and has not complied with court orders demanding that he produce documentation regarding his trust account, which creditors believe contains significant amounts of money.
When asked by the Mississippi Business Journal how his client was doing, Evans’ lawyer John Colette said, “He’s not too happy.”
Evans was found by U.S. Marshals on Wednesday after being held in civil contempt of U.S. Bankruptcy Court.
The first criminal charges were finally filed in the Evans case when Charles resisted arrest.
A Clarion-Ledger report says he was found at MetroCenter Mall in Jackson. According to the Marshals’ report, while being pulled out of his vehicle, Evans reached for a blue bag in the back seat which was found to contain a firearm. Evans struggled with an agent and was subdued, probably by a taser, Collete said.
Judge Linda Anderson granted the request of Assistant U.S. Attorney Mike Hurst and agreed to detain Evans for three days. Hurst said an unavailable FBI agent needed to be present for a hearing due to flight risk issues.
A preliminary hearing regarding Evans’ felony charge is scheduled for June 1 at 2:30 p.m.
After the judge’s ruling, Evans could be heard complaining to his attorney about the conditions at the Madison County Jail. “It’s 62 degrees in there,” Evans said.
Collete then told the judge that Evans was sleeping on the floor at the jail with a garment similar to a hospital gown and requested that the judge ask that he be given a bed.
Anderson said she would ask the Marshals to investigate the situation.
Creditor Is Sure Evans Has Cash
Prior to Evans’ appearance at the James O. Eastland U.S. Courthouse for felony charges, Evans lawyers and several creditors met down the street at an emergency hearing at U.S. Bankruptcy Court regarding a motion Evans filed for his own release from jail.
Judge Neil Olack ruled that Evans would be allowed to wear an ankle bracelet and stay at the home of his brother Chris Evans in Ridgeland. The order will require that Evans stay within a 20-mile radius of the residence and surrender his passport.
Attorney for Mississippi Valley Title Insurance Company, Scott Jones, asked that Evans remain detained until he could be examined by creditors.
“Our position is that he likely holding significant funds and that he has money… (Evans) has been renting cars. He has been staying in hotels,” Jones said. Charles’ wife Gail Evans also provided MVT with evidence that her husband had been renting a storage unit in the name of Howard Evans, Jones said.
One of Evans’ attorneys, Terry Levy, had argued that it would be easier to deal with Evans if he were not detained, so they could get information from him.
Jones said that argument was not valid because Evans won’t return phone calls. MVT has spent more than $20,000 for process servers and legal fees, Jones said. If Evans had complied with court orders, we wouldn’t be here, yet he wants to be accommodated, he said. Additionally, Jones said MVT believes Evans is a flight risk and a danger to society since he was found with a revolver.
Levy said it seemed like Jones wanted to punish Evans. “That’s not what we’re here to do,” he said.
Olack said his court held Evans in civil contempt and had jurisdiction to compel but not punish.
The judge told Levy and attorney Richard Bradley that “If we get a call from Court Watch and we have to send a Marshal our for the second time, it’s going to be very problematic. He has evaded every opportunity to deal with these issues… He really does not want to make a mistake again.”
Olack then said an order had to be signed today because he had to go to a wedding rehearsal and didn’t want to “be held in contempt by (his) wife.”
Evans will be examined by creditors in a closed meeting on June 8 and 9.
Felony proceedings currently override the bankruptcy court order. Evans will spend Memorial Day weekend in Madison County jail.
Earlier Post-May 28: Charles Evans Jr. Arrested
Charles Evans Jr. was arrested Wednesday and is being held at the Madison County Jail, according to the U.S. Marshal’s office and the Madison County Sheriff’s department.
On May 21 a federal bankruptcy court judge issued an arrest warrant for Evans after holding him in civil contempt for failing to appear in court and failing to produce documents regarding his trust account. No criminal charges have been filed.
Charles Evans Jr. and his brother Chris Evans have been charged with conducting a commercial real estate mortgage-stacking scheme that has done $40 million in damages to more than 30 Mississippi banks. Alleged illegal activity began as early as 2003. The first lawsuit in the case was filed in September 2009.
Creditors in the Evans case are still trying to find out where the money went and if any is left. Parties have obtained some information on Charles Evans Jr.’s trust account, Charles has consistently stalled the process. He failed to appear in court at the end of March.
Judge Neil Olack has granted the trustee Derek Henderson’s request to question Charles’ wife, Gail Evans, regarding payments she received from her husband’s trust account.
Olack has also given the trustee permission to compel BankPlus to turn over complete files of the account.
The trustee and numerous banks have filed motions disagreeing over the process in which the trustee might sell off various parcels of land to produce income to pay off claims made by banks who are seeking to recover from loans that are in default.
The trustee has recommended Brian Estes of The Estes Group Inc. and Grubbs & Ellis/Sawyer Commercial as brokers for Madison County properties. Trey Sowell of Grubbs & Ellis/Memphis has been recommended for sales of DeSoto County properties.
A hearing is scheduled for June 7 at Bankruptcy Court for the Southern District of Mississippi in Jackson.
Chris Evans and his brother Charles Evans Jr. were accused in September of running a commercial real estate Ponzi scheme that has done $40 million in damages to more than 30 Mississippi banks.
The brothers were sued by Mississippi Valley Title Insurance Company (MVT) in Madison County Chancery Court.
Chris Evans filed for bankruptcy in October. Case proceedings have since been transferred to U.S Bankruptcy Court for the Southern District of Mississippi located in Jackson.
Charles Evans Jr. was an approved attorney of MVT and issued title insurance policies on behalf of the company.
Chris Evans and business entities under his control owned properties in Madison, Desoto and Harrison counties as well as in the state of Texas. Alleged fraudulent activities began as early as 2003.
MVT alleges the Evans brothers repeatedly defrauded MVT and banks by in a mortgage-stacking scheme. The brothers allegedly borrowed funds from lenders through shell companies, using various parcels of land as collateral, when the title to the collateral was not owned by the business entity obtaining the loan.
MVT has $30 million set aside for claims reserves, which is not enough to pay the 65 claims made by banks. The company’s parent, Old Republic National Title Insurance Company (ORNT), jointly issued all of the company’s policies. ORNT has several hundred million in claims reserves.