November 20, 2009 — Communities throughout Northeast Oklahoma including Claremore, Verdigris and the greater Tulsa metropolitan area are looking for Grant Cole, a builder associated with Oklahoma New Homes Direct of Broken Arrow and Xite Homes. Of equal if not greater importance is the search for the money Cole allegedly bilked out of local home buyers.

Wednesday, Brandon Perkins, president of the Home Builders Association of Greater Tulsa and former owner of Xite Homes, said he believes eventually Cole will pay his dues.

“I believe that there’ll be some justice coming,” said Perkins.

Cole is believed to have made off with well over $1 million paid to his company by homeowners and their banks and not paid out to subcontractors such as the plumbers, electricians and carpenters doing the work and providing the materials for the homes. Many of those houses are around 80 percent complete, but without payment to those who were building them, work has stalled.

Perkins sold Xite Homes to Cole around 18 months ago.

The Xite name lent some credence to Cole’s scam, but Perkins said that really shouldn’t have been the case. He said he sold the business because it did not have the most reliable reputation, and he had been unable to find good management to turn that around.

Hundreds of material mechanics liens against the properties in question were filed in Rogers, Tulsa and other counties in late October. Home buyers, not Cole or his businesses, will be held accountable for those liens.

Home buyers say they could end up paying twice what their homes are worth if they want to finish and occupy them.

Perkins said Cole put a stop payment on a check, forcing Perkins to file a lawsuit. All in all, Perkins said Cole burned him for around $50,000. He said Cole is not ignorant. Had the check bounced, the District Attorney would have become involved. Because of the stop payment, it became a civil matter.

Cole was apparently adept at talking even knowledgeable people into believing him. Dozens of subcontractors worked with no payment. Perkins said that is not totally unusual and that many in this business learn to wait on their money. Payment may come slowly, but usually it always comes. Those contractors providing services are normal working folks, trying to put food on the table. They, like the home buyers have been left holding the bag. An empty bag.

Lawsuits and other motions have been filed looking for any funds Cole may have left behind.

The biggest victims in this case, said Perkins, are the families whose dreams of a new home have been, at least for the time being stolen along with their investment dollars.

It is estimated that around 40 families of home buyers were affected. No estimates on the numbers of contractors financially impacted by the scheme have been released.

Scams such as the one Cole allegedly operated put a black eye on the industry and leave buyers skeptical in a market already suffering from a downturn. Perkins said while there is no sure way to for home buyers to protect themselves, there are red flags that can be warning signals.

“If the price seems too good to be true, it probably is,” said Perkins. “This isn’t industry specific. I love this industry. There are unscrupulous people in every industry.”

Checking with the local Home Builders Association and the Better Business Bureau are also ways to protect yourself when selecting a builder, said Perkins. He said Cole was denied membership by the HBA.

Oklahoma New Homes Direct has a B-rating with the BBB. According to the BBB Web site information available, that less than stellar rating is due to complaints. Perkins said he believed the rating should have been lower.

Home buyers should stick with established, well known builders with a reputation and history in the community and plenty of references, said Perkins.

If a builder is a “flash in the pan” and comes into a new area “selling a ton of houses all of a sudden” that can be a warning that something is amiss, said Perkins.

Buyers are more informed today, and it’s hard to “pull something over” on people with high prices. That means prices are more consistent and stable, said Perkins. So when a builder is way below everyone else in the area, something is probably not legitimate about the operation.

“Stay with local, established builders with track records, credentials and references,” he said.

Perkins is a second-generation developer in the Tulsa area. He and his father, Lindsey Perkins, developed neighborhoods in Tulsa and surrounding areas including the Vintage at Verdigris in Rogers County. Perkins serves on committees for the Home and Garden Show and Parade of Homes. He also serves on the Board of Directors of both the State and National Home Builders Associations.

Cole’s brother Stuart Clay Cole was convicted of running a similar scam in Georgia a little over a decade ago. He served eight years in a federal penitentiary and was released in 2005. Currently, he is under investigation of the U.S. Postal Service for allegedly committing fraud related to a private child support collection service he operated in multiple states in the southeast. Stuart Cole has also allegedly vanished.

While the FBI has not confirmed or denied their investigation of Oklahoma New Homes Direct, multiple sources have confirmed the feds are looking into the matter. Money transfers across state lines and bank fraud are two potential violations that would allow for federal involvement.