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Lenders want McHenry County State's Attorney's Office to pay for damage to Bull Valley home

BULL VALLEY – A recent inspection of an expansive Bull Valley property where police found 350 pounds of marijuana in May revealed thousands of dollars of water damage – and attorneys for a lending company want the McHenry County State’s Attorney’s Office to pay at least part of the repair costs.

Attorneys for the lender, Medford Real Estate Fund I LLC, have asked the state’s attorney’s office to foot the bill for more than $30,000 of damage assessed in the house at 1001 N. Cherry Valley Road, which, upon inspection, appeared as though it hadn’t been properly looked after for months, Medford attorney Todd Rowden said.

In a letter sent to prosecutors, Rowden wrote that the house had significant damage to its ceilings, drywall and flooring, and it was beginning to grow mold. In addition to the mess created by a burst pipe during a cold snap a couple of weeks ago, Rowden said the house was in “complete disrepair, with trash strewn throughout.”

“It appears that the property has not been properly maintained and in fact had deteriorated over, at least, many months,” the letter said.

McHenry County Assistant State’s Attorney Tom Cahill declined to comment on the letter or Medford’s request for his office to front the cost of repairs.

Rowden said prosecutors denied his request to pay for the damage.

Medford, which loaned money to the trust that bought the property, previously had filed an emergency motion seeking control of the property after a pipe burst Jan. 10. On Jan. 16, McHenry County Judge Michael Chmiel appointed Newpoint Advisors Corp. to look after the land while attorneys continue to dispute over the rights to its mortgage.

The state’s attorney’s office sought to seize the property as proceeds from criminal activity after the drug bust in May. Medford is fighting that and trying to foreclose on the property so it can be sold and the company can recoup its investment.

If prosecutors can prove the home was bought with drug money, it could be sold off, with the proceeds going to local and state law enforcement and government agencies.

David A. Soskin, 43, bought the property for $800,000 in December 2016 through a trust after getting a $450,000 mortgage from Medford. Lawyers for the financing company claim that Soskin and his fiancée, 26-year-old Jamie M. Lee, were living in the home instead of fixing it up to flip it. Soskin signed loan documents saying he wouldn’t be living in the home, according to court records.

Sheriff’s deputies searched the couple’s home May 19 and found about $3.2 million worth of marijuana in a locked closet in the master bedroom, according to court documents.

Police also found a .50-caliber machine gun, a Cobray M11 machine pistol with a suppressor, a shotgun and several boxes of ammunition at the mansion, records show. 

Soskin and Lee both face charges of marijuana trafficking, possession of marijuana with intent to deliver and possession of marijuana. Prosecutors have filed additional weapons charges against Soskin.

Out on bond while her case is pending, Lee reported the water leak during a visit to the home, where she possibly was picking up mail, Rowden has said.

Fire officials were called to the home Jan. 10, and saw water leaking both inside and outside the house, with an “ice dam” built up, according to a report filed by the McHenry Township Fire Protection District. It was unclear how long the water had been leaking.

At a Jan. 5 hearing, Soskin’s attorney, Nicholas Giordano, said the house was secured, with functioning heat and electricity.

But inside the 17,000-square-foot mansion, inspectors found the onset of mold, toilet bowls filled with frozen water and multiple heating, ventilation and air conditioning problems, Rowden said.

Although the heat still was on in some parts of the house, four or five of the home’s six HVAC units were not operating properly, leaving most of the house without heat.

Newpoint received a $32,000 quote to remove wet drywall, baseboards and carpet, and clean the home, but to begin work, the restoration company, ServiceMaster, requires an immediate 50 percent down payment, Rowden said.

In addition to the work covered in the $32,000 quote, HVAC workers will need to visit the home to restore heat and determine whether there are other cracked pipes that need to be replaced.

Rowden has asked the state’s attorney’s office to pay for all or half of the repair costs, based on Medford’s claims that the damage was preventable if prosecutors had cooperated with lenders’ requests to allow access.

“Medford’s attempts to preserve and protect the property and maximize its value have been met with opposition by the McHenry County State’s Attorney’s Office at every turn, even after the parties were advised that a pipe burst at the house, causing significant damage,” Rowden said.

Soskin’s arrest led to scrutiny of his dealings with Medford. One of the company’s leaders, Stuart Urkov, has denied allegations that the drug dealer was an investor in the real estate financing company.

In previous court filings, the state has argued that Medford has no interest in the property, and asked the court to dismiss the foreclosure attempts.

On March 30, Medford signed its rights to the mortgage to TBK Bank. Although the mortgage later was signed back to Medford, the state’s attorney’s office has said it was too little too late, and Medford no longer had the right to foreclose on the home.

“[Medford] does not have legal capacity to bring this foreclosure proceeding, as [Medford] is not the holder of the subject mortgage,” Cahill wrote in a July 10 motion.

Once repairs are made, Medford wants to sell the property and have the proceeds held in escrow.

Newpoint has until Tuesday to file a report of its findings in McHenry County court, according to Chmiel’s order.

The case will resume Feb. 13.

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