James Wise Clayton Morris Trailer video

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James Wise Clayton Morris Trailer video

Jay HinrichsBusiness Member
Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes

For all of you who did not catch this Trailer video that James posted on U Tube I was able to watch it.. 

I found it well done.  And was even more amazed that Jim got Clayton on the phone all the way from Portugal.

other than a few F bombs by both parties.. it was and is well done.

Even a little Cameo from myself LOL..

Jim has gotten videos and audio testimony from industry experts and actual victims as well as when you see it a phone call with Clayton himself.. I am not sure if there is more Audio on Clayton that I saw on the trailer.

But suffice it to say.. it was Vintage Morris  IE just pretty much exactly how his wife portrays them as victims.

Clayton goes on to mention other Indy providers that were in the same mess with Whalen .. And then proceeds to question Jim's investigative reporting bona fides.. And Clayton wanted to know what business was it of Jim's to be doing this at all.  And Clayton mentioned me as well as I have been from the very first post pretty straight forward that the model as sold by Morris even if all the rehab funds had not been diverted and you had ponzi like rental payments being made , that the model is and was flawed from day one and would never have worked as he described.. 

The big one though was When Jim says to Clayton  " But dude your in Portugal how does that make you look"  no answer.. 

For sure one thing is certain he is no dummy and I am sure he talked to many lawyers about where he could go to avoid massive litigation and potential criminal and then set up shop and keep selling whatever he is selling to new folks.

U still see it on any social media when his wife gets on and does the Poor this is not fair to Clayton or I routine.. there will be 50 people singing their praise.. Of course I Bet not one of them lost their entire life's savings like one of the investors that Jim had interviewed and is on the trailer.. 

I commend Jim for his work in this .. It will have benefits throughout the industry showing and teaching people about OOS investing and being led by someone with a lot of fame but no real estate experience to speak of... 

Lastly this is a sad case Morris with his background could have been one of the larger resellers of rentals in the US no doubt right up there with the other big resale companies we all know about.. And I can tell you from first hand experience all those other resale companies ran into the same thing Morris did.. but the difference is they realized it quickly and cut off those bad actors by and large. 

@Jim K.@James Wise    Jim I tagged you on accident but in reality you could write the how to book on how to navigate those lower end assets. 

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Kathy FettkePro Member
Rental Property Investor · Los Angeles, CA · Member since 2014 · 100 posts · 180 votes
6y

I had Clayton on my podcast years ago and was shocked that he was selling properties in the hood. I'd been down that road and knew the perils of it. I asked how he was making that work as it sounded risky to me. He said it was going great. (I thought, there must be something he doesn't know quite yet...)

In 2010, a large group of Australians came to me begging for $10,000 properties that rented for $900/month, as they'd seen on TV somewhere. I told them if I could find such a thing, I would buy it too! :-) 

We ended up touring Kansas City together and met with several "turnkey" providers. One of them was a property manager in the inner city of KC. On paper, he had these kinds of returns. I warned the Aussies in a follow up email that low-income, high crime areas were not recommended by me or RWN. They wrote back saying it was none of my business what they do... After all, the homes were so very cheap  - often less than $10,000 - what could go wrong? (Everything!)

Several bought these rentals, in spite of my advice. Not many months later, they contacted me to tell me it was a nightmare. The properties had high turnover, and every time they did a make-ready, items would get stolen. The repair costs from damage and theft were so high they begged to sell these inner-city properties. But who would buy?

They tried to blame me but I reminded them of the email I sent them. Investors really do need to take responsibility for the choices they make. They can sue all day long, but in the end, they won't get their money back in most cases. Does Clayton have insurance? I doubt it. While he should have been on top of the situation, so should the investors. Did they visit the properties, perform inspections and appraisals and rent comps? They never should have paid for renovations before they were done. 

I don't mean to sound harsh, but I am quite Republican in this regard. People, especially investors, need to take responsibility for the choices they make. Many of these losses could have been avoided with property due diligence. A Fox TV host does not make someone a savvy real estate investor. 

Some consider me a "celebrity" too but this doesn't mean that just because I recommend something, investors shouldn't also do their proper due diligence. A guy bought some crappy properties through a provider we no longer work with. He failed to visit the property, get inspections or appraisals. He didn't do any investigation at all. And when things didn't work out, he wanted to blame me. I didn't even know he bought them! He never asked for my advice. We were never paid any kind of referral fee.

I hate seeing investors lose money. I have lost money from trusting the wrong people, and it stinks. But I never blamed anyone but myself.

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  • Jay HinrichsBusiness Member
    OP
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    6y
    Originally posted by @Phil Dodd:

    Is he really in Portugal?

    yes 

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  • Joel OwensBusiness Member
    Moderator
    Real Estate Broker · Canton, GA · Member since 2010 · 15k+ posts · 11k+ votes
    6y

    Many of investors on BP warned of buying properties for XX in certain area could and likely would be a recipe for disaster because of various metrics at play.

    Investors want to put blinders on and do it anyways and when things come to fruition they are looking for ways to save face. You combine that with a possible company (talking in generalities not a specific company) that wants to make a quick buck off of investors with that mindset you get a perfect storm brewing.

    Of course it's human nature to still feel bad for the investors where things did not turn out as planned and hoped for. In many cases these investors put almost all or a considerable part of their net worth buying these type of properties and that can be in many cases nothing more than gambling. On high risk assets like this if an investor invests at all generally investors make it a tiny percentage maybe under 5% of their holdings. This way if it breaks even or even loses money they can likely dump the property and still make back the losses in a short time from their overall portfolio returns of higher quality type properties in better locations.

    A lot of this is investors are generally misinformed just how much of a pain it can be to deal with residential tenants especially the lower income and rougher area ones. It can be a full time job with not much returns to speak of just headaches. Most of the investors I know spend very little time if any owning these assets and move on as soon as possible to greener pastures.

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  • James Wise
    Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 30k+ posts · 20k+ votes
    6y

    UPDATE:

    YouTube has accepted my Copyright counter claim that Clayton's Copyright claim of my video is bogus.  What this means is that he's now got 10 business days to get a court order to prevent me from putting the video back up. Seems like a pretty tough task to accomplish when you are hunkered down in Portugal avoiding the United States.

    As a side note to the above has anyone seen the most recent Morris Invest video? It was released last night. It's titled "mistakes don't exist" Essentially it is Clayton Morris giving a monologue about mistakes being good for entrepreneurs and the world in general. He goes into some stories about Henry Ford loosing all of his investor's money not once, but twice and then some nonsense about Albert Einstein only figuring out E = MC² due to the mistakes he's made. Lol, sounds an awful lot like a guy who's trying to prep his audience for a storm as he knows his goose is cooked with this video coming out.

    @David Barnett @Russell Brazil @Trent Chance @Ola Dantis @Phil Dodd @Mike Dymski @Roni E. @Ryan Evans @Kathy Fettke @Joel Fine @Mike H. @Jim K. @Robert Matelski @Chad McLeod @Dennis M. @Pavel Shemyakin @Tanner Marsey @Account Closed 

    11Reply
  • Jay HinrichsBusiness Member
    OP
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    6y
    Originally posted by @Joel Owens:

    Many of investors on BP warned of buying properties for XX in certain area could and likely would be a recipe for disaster because of various metrics at play.

    Investors want to put blinders on and do it anyways and when things come to fruition they are looking for ways to save face. You combine that with a possible company (talking in generalities not a specific company) that wants to make a quick buck off of investors with that mindset you get a perfect storm brewing.

    Of course it's human nature to still feel bad for the investors where things did not turn out as planned and hoped for. In many cases these investors put almost all or a considerable part of their net worth buying these type of properties and that can be in many cases nothing more than gambling. On high risk assets like this if an investor invests at all generally investors make it a tiny percentage maybe under 5% of their holdings. This way if it breaks even or even loses money they can likely dump the property and still make back the losses in a short time from their overall portfolio returns of higher quality type properties in better locations.

    A lot of this is investors are generally misinformed just how much of a pain it can be to deal with residential tenants especially the lower income and rougher area ones. It can be a full time job with not much returns to speak of just headaches. Most of the investors I know spend very little time if any owning these assets and move on as soon as possible to greener pastures.

    Exactly Joel..  this model was doomed before it ever started even if they did not steal rehab money and have a big rental ponzi going IE paying rents on vacant homes.. long term just never works..  Local landlords who do it for a living and choose to take on these management issues can and do make it work.. someone thinking this is passive income to financial freedom simply does not know what they don't know you cant have passive income and financial freedom when your tenant base is so severely limited in cash credit and basic ability to live and survive.. 

    Investors need to do basically one thing if they are going far afield to buy SFR's figure out the median price of an area and buy at that.. your returns will be less for sure on COC But your buying a stable asset in a safe neighborhood that most of the homes are being bought by homeowners.. when you go into SFR's and all the home sales are to investors.. this needs to be looked at very carefully.. as you have no exit other than another cash flow investor.. Money in this game is made on appreciation unless you have 50 doors or more..

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  • James Wise
    Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 30k+ posts · 20k+ votes
    6y
    Originally posted by @Joel Owens:

    Many of investors on BP warned of buying properties for XX in certain area could and likely would be a recipe for disaster because of various metrics at play.

    Investors want to put blinders on and do it anyways and when things come to fruition they are looking for ways to save face. You combine that with a possible company (talking in generalities not a specific company) that wants to make a quick buck off of investors with that mindset you get a perfect storm brewing.

    Of course it's human nature to still feel bad for the investors where things did not turn out as planned and hoped for. In many cases these investors put almost all or a considerable part of their net worth buying these type of properties and that can be in many cases nothing more than gambling. On high risk assets like this if an investor invests at all generally investors make it a tiny percentage maybe under 5% of their holdings. This way if it breaks even or even loses money they can likely dump the property and still make back the losses in a short time from their overall portfolio returns of higher quality type properties in better locations.

    A lot of this is investors are generally misinformed just how much of a pain it can be to deal with residential tenants especially the lower income and rougher area ones. It can be a full time job with not much returns to speak of just headaches. Most of the investors I know spend very little time if any owning these assets and move on as soon as possible to greener pastures.

     What we have seen here isn't even related to the type of asset that was sold though. What you won't see in the film is a bunch of dipstick investors complaining that the tenants in their $45,000 houses got evicted. That's just part of the rental business. We cannot and will not place that on Clayton's shoulders. However what we have seen is

    • Evidence of rents being paid out to investors on properties that never had occupants living in them.
    • Evidence of sellers taking in rehab money for homes that were never renovated.
    • Evidence that new construction homes were sold, but never built.
    • Evidence of unlicensed brokerage activity on the sales and property management side.
    • Evidence of misinformation about the types of assets that were sold.
    • Evidence of misinformation about who the principals were.
    • Evidence of misinformation about who would be handling the property management.
    • Evidence of negligence on behalf of property management teams in handling the tenants, evictions and rehabs.
    5Reply
  • Joel OwensBusiness Member
    Moderator
    Real Estate Broker · Canton, GA · Member since 2010 · 15k+ posts · 11k+ votes
    6y

    The other part Jay for investors is when most of the homes are investor owned you have different types of investors how they upkeep their properties. Some try to do a good job, others try to maintain the properties to a minimum, and the others are slum lords trying to take every penny of cash flow and not maintain the asset to expected industry standards.

    These surrounding properties then can really hurt the values and tenant base for who wants to rent there. This is why some investors will try to buy the whole  block to try and control what is going on in the area to maintain values and draw hopefully a better tenant base.

    This can be why in a subdivision it can be beneficial to have an HOA that is fair but not over the top and most of the base homeowners versus renters. This way you tend to get renters that want to live more like homeowners and stay for awhile. In a bunch of studies long term the total return tends to outpace what investors thought they would get in higher cash flow on these lower quality assets.

    What stumps me is a bunch of these investors are from CA and other states like New York. Their incomes are good and accredited status so why even buy this stuff? If they do not want to put that much money into one property then maybe they invest in a sponsor type deal on a larger property for 25k to 100k cash in per deal.

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  • Jay HinrichsBusiness Member
    OP
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    6y
    Originally posted by @Joel Owens:

    The other part Jay for investors is when most of the homes are investor owned you have different types of investors how they upkeep their properties. Some try to do a good job, others try to maintain the properties to a minimum, and the others are slum lords trying to take every penny of cash flow and not maintain the asset to expected industry standards.

    These surrounding properties then can really hurt the values and tenant base for who wants to rent there. This is why some investors will try to buy the whole  block to try and control what is going on in the area to maintain values and draw hopefully a better tenant base.

    This can be why in a subdivision it can be beneficial to have an HOA that is fair but not over the top and most of the base homeowners versus renters. This way you tend to get renters that want to live more like homeowners and stay for awhile. In a bunch of studies long term the total return tends to outpace what investors thought they would get in higher cash flow on these lower quality assets.

    What stumps me is a bunch of these investors are from CA and other states like New York. Their incomes are good and accredited status so why even buy this stuff? If they do not want to put that much money into one property then maybe they invest in a sponsor type deal on a larger property for 25k to 100k cash in per deal.

    they maybe accredited but by and large it appears not real estate savvy per se !

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  • Russell BrazilBusiness Member
    Moderator
    Real Estate Agent · Washington, D.C. · Member since 2012 · 17k+ posts · 30k+ votes
    6y

    I work with plenty of accredited investors who are accredited by income, but have very little liquid cash available to invest. They have high incomes, even high balance retirement account, but lack cash and liquidity.  I see a lot of them go buy the junk assets in Baltimore instead of the good stuff right in front of them in DC and the DC suburbs.  Then after a year or two they are unloading the crap at a loss.  People just get blinded by the proforma returns if they dont have a basic education in investments. @Joel Owens @Jay Hinrichs

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  • Russ B.
    Investor · Cleveland, OH · Member since 2017 · 319 posts · 330 votes
    6y
    Originally posted by @James Wise:
    Originally posted by @Joel Owens:

    Many of investors on BP warned of buying properties for XX in certain area could and likely would be a recipe for disaster because of various metrics at play.

    Investors want to put blinders on and do it anyways and when things come to fruition they are looking for ways to save face. You combine that with a possible company (talking in generalities not a specific company) that wants to make a quick buck off of investors with that mindset you get a perfect storm brewing.

    Of course it's human nature to still feel bad for the investors where things did not turn out as planned and hoped for. In many cases these investors put almost all or a considerable part of their net worth buying these type of properties and that can be in many cases nothing more than gambling. On high risk assets like this if an investor invests at all generally investors make it a tiny percentage maybe under 5% of their holdings. This way if it breaks even or even loses money they can likely dump the property and still make back the losses in a short time from their overall portfolio returns of higher quality type properties in better locations.

    A lot of this is investors are generally misinformed just how much of a pain it can be to deal with residential tenants especially the lower income and rougher area ones. It can be a full time job with not much returns to speak of just headaches. Most of the investors I know spend very little time if any owning these assets and move on as soon as possible to greener pastures.

     What we have seen here isn't even related to the type of asset that was sold though. What you won't see in the film is a bunch of dipstick investors complaining that the tenants in their $45,000 houses got evicted. That's just part of the rental business. We cannot and will not place that on Clayton's shoulders. However what we have seen is

    • Evidence of rents being paid out to investors on properties that never had occupants living in them.
    • Evidence of sellers taking in rehab money for homes that were never renovated.
    • Evidence that new construction homes were sold, but never built.
    • Evidence of unlicensed brokerage activity on the sales and property management side.
    • Evidence of misinformation about the types of assets that were sold.
    • Evidence of misinformation about who the principals were.
    • Evidence of misinformation about who would be handling the property management.
    • Evidence of negligence on behalf of property management teams in handling the tenants, evictions and rehabs.

    It's related to the asset class in that it was a huge red flag - easy, reliable returns on properties in poor neighborhoods is a classic example of "too good to be true".

    There are people who make good money on this class of property, but those people are generally specialists who live nearby, and it's usually their full time job. The operations side is bigger than the capital investment side (the houses themselves), so the people who are successful in this space don't need anyone else to buy the houses for them - the house is the cheap part. 

    The problem is, what's painfully obvious to a more experienced investor is not obvious to someone who's hoping to become one. Real estate is tricky that way. So, it's easy for some guru to promise the world and get people to believe it... especially if said guru is willing to flat out scam people. 

    4Reply
  • Russell BrazilBusiness Member
    Moderator
    Real Estate Agent · Washington, D.C. · Member since 2012 · 17k+ posts · 30k+ votes
    6y

    Even though that post above me sounds exactly like me, I swear that @Russ B. is not a 2nd account of mine lol.

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  • Account Closed
    Rental Property Investor · Torrance, CA · Member since 2016 · 724 posts · 1k+ votes
    6y

    @Jay Hinrichs @James Wise

    Do you believe Clayton intended the Ponzi scheme from the beginning? Or do you think he did to try and stay afloat after the ship started to sink? I can’t imagine he would be stupid enough to think a fraud like this would actually work.

    0Reply
  • Russ B.
    Investor · Cleveland, OH · Member since 2017 · 319 posts · 330 votes
    6y
    Originally posted by @Russell Brazil:

    Even though that post above me sounds exactly like me, I swear that @Russ B. is not a 2nd account of mine lol.

    😂

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  • Jay HinrichsBusiness Member
    OP
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    6y
    Originally posted by @Account Closed:

    @Jay Hinrichs @James Wise

    Do you believe Clayton intended the Ponzi scheme from the beginning? Or do you think he did to try and stay afloat after the ship started to sink? I can’t imagine he would be stupid enough to think a fraud like this would actually work. 

    Having been around this business for 4 plus decades I have seen these flame outs.. and I have seen people like this go to prison..  But I believe that the majority and I do believe this true of Clayton they did not wake up one day and think they were going to create a multi million dollar fraud.. Now Whalen that's another story. Or look at it this way you have Murder 1  that's premeditate and you have manslaughter..  but end result someone died and your the nexus..  

    The issue with Morris is he knew and kept going  money becomes a drug when your making 200k or more a month.. Like it appears he was doing.  

    Its the old Rob Peter to Pay Paul.. and well the law does not care about that part its just the end results and the actions you took. 

    ON the Trailer Morris talks about High Rental REturns there in Indy having the same issues.. and I think Jim might have interviewed them.

    It appears High rental returns put a stop to what was going on and righted the ship other wise you would see post on folks that had a bad day working with them.. this is not unique to any of us.. myself included.. we run into bad actors what we do though is stop.. clean up and move on.   Morris did not stop.. I personally was sitting in a PM's office in Indy when he was talking to Morris on the phone and this was 2017.. And Morris needing to change management etc.. He knew it then  he basically admits it on Jim 's call with him.. he could have stopped.. But they kept going then rolled out this new construction model.. that all that did was buy 500.00 lots bring in 70k in cash from investors with a promise to build a new rental ( because they were having so much trouble with existing inventory and rehab) but then the money just got sucked out and Nothing was ever done.. So you have investors who bottom line paid 70k for a 500.00 lot.. 

    Plus look at old Morris videos he is walking the neighborhoods he was there he saw it.. lastly when people did complain he would buy property back.. but kept selling the same junk.. Same thing with Jacksonville FLA  and the stuff they are or were selling in Detroit is the roughest area of town.. HIs model is not reality never was never will be. 

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  • Chris ClothierBusiness Member
    Rental Property Investor · memphis, TN · Member since 2009 · 2k+ posts · 3k+ votes
    6y
    Originally posted by @Joel Owens:

    What stumps me is a bunch of these investors are from CA and other states like New York. Their incomes are good and accredited status so why even buy this stuff? If they do not want to put that much money into one property then maybe they invest in a sponsor type deal on a larger property for 25k to 100k cash in per deal.

    Not to get too far off topic, lol!  

    I believe it’s a form of loss aversion.  Whereby investors are more concerned with losing larger amounts of money than they are in gaining those same large amounts of money.  So, they tend to invest in something, even though it is more risky and has a higher propensity of failure, if it costs less and they will therefore lose less money.

    From reading between the lines on all of the forums, it appears that there should be a lot more investors with losses than those that have spoken out.  One reason could be that they expected to lose to begin with.  They could have thought all along that it was risky and not likely to be true, but it was a relatively small amount of money to risk.  They may not be coming forward with complaints because they are thanking their lucky stars they didn’t invest in bigger real estate deals and lose even more.  Unfortunately, it is very common for investors to choose the one investment that is the most risky and will likely lead to a total loss if it is “cheaper” and a smaller amount of money to lose.

    Loss aversion happens in all forms of investing and other monetary decisions and the reality is many of us make decisions this way.  I know I have to fight the tendency to justify investments by this rational so I’m not blaming anyone.  I have made this mistake in the past and like I said, have to fight it myself. 

    Good luck with the doc @James Wise.

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  • Jay HinrichsBusiness Member
    OP
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    6y
    Originally posted by @Chris Clothier:
    Originally posted by @Joel Owens:

    What stumps me is a bunch of these investors are from CA and other states like New York. Their incomes are good and accredited status so why even buy this stuff? If they do not want to put that much money into one property then maybe they invest in a sponsor type deal on a larger property for 25k to 100k cash in per deal.

    Not to get too far off topic, lol!  

    I believe it’s a form of loss aversion.  Whereby investors are more concerned with losing larger amounts of money than they are in gaining those same large amounts of money.  So, they tend to invest in something, even though it is more risky and has a higher propensity of failure, if it costs less and they will therefore lose less money.

    From reading between the lines on all of the forums, it appears that there should be a lot more investors with losses than those that have spoken out.  One reason could be that they expected to lose to begin with.  They could have thought all along that it was risky and not likely to be true, but it was a relatively small amount of money to risk.  They may not be coming forward with complaints because they are thanking their lucky stars they didn’t invest in bigger real estate deals and lose even more.  Unfortunately, it is very common for investors to choose the one investment that is the most risky and will likely lead to a total loss if it is “cheaper” and a smaller amount of money to lose.

    Loss aversion happens in all forms of investing and other monetary decisions and the reality is many of us make decisions this way.  I know I have to fight the tendency to justify investments by this rational so I’m not blaming anyone.  I have made this mistake in the past and like I said, have to fight it myself. 

    Good luck with the doc @James Wise.

    Exactly Chris.. 

    All of us in this industry IE flipping rental houses to investors.. have dealt with these lower value assets.. those that survive end up moving up and out of the asset class.. Investors do not realize the exact opposite is true like you delineated above. The Risk rises when the all in purchase price goes down on the SFR rental asset.. these assets price for Risk / Reward.. I think MI has done a wonderful job identifying that and moving up to assets that perform over time because of starting price points.. your just in better areas better schools stronger tenants etc. So in the VERY long run those assets even though day one don't make quite the paper return as the super low value assets.. they are consistent and you don't often have the really bad days like these folks experience when your buying in the bottom 20% of the price point of a given MSA and dealing with that tenant base.

    I have read every thread and response regarding Morris on BP.. there are many who lost significant sums'  IE 200k to over 500k in cash.. so it was not just hey lets throw 40k at this and if it does not work no biggee.. and the smaller investors even though it was a smaller number it was a very large % of their liquidity. 

    Enjoy your day !!!

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  • Ola Dantis
    Multifamily Syndicator · Houston, TX · Member since 2016 · 1k+ posts · 2k+ votes
    6y
    Originally posted by @Russell Brazil:

    I work with plenty of accredited investors who are accredited by income, but have very little liquid cash available to invest. They have high incomes, even high balance retirement account, but lack cash and liquidity.  I see a lot of them go buy the junk assets in Baltimore instead of the good stuff right in front of them in DC and the DC suburbs.  Then after a year or two they are unloading the crap at a loss.  People just get blinded by the proforma returns if they dont have a basic education in investments. @Joel Owens @Jay Hinrichs

     Totally agree with this statement because Clayton Morris was selling a product people somehow believed to be feasible? 

    Buy in the bad areas, rehab to an amazing turnkey and then rent to an amazing tenant. 

    Sounds too good to be true? RED ALERT! 🚨🚨🚨

    Sadly, perhaps greed and maybe the celebrity attraction syndrome hijacked many minds... It is unfortunate.

    1Reply
  • James Wise
    Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 30k+ posts · 20k+ votes
    6y
    Originally posted by @Account Closed:

    @Jay Hinrichs @James Wise

    Do you believe Clayton intended the Ponzi scheme from the beginning? Or do you think he did to try and stay afloat after the ship started to sink? I can’t imagine he would be stupid enough to think a fraud like this would actually work.

    I don't think intent is relevant. I said earlier that the only thing that matters is the outcome. That said, no I do not believe that Clayton Morris ever set out to build a business to harm investors.

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  • Jay HinrichsBusiness Member
    OP
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    6y
    Originally posted by @James Wise:
    Originally posted by @Account Closed:

    @Jay Hinrichs @James Wise

    Do you believe Clayton intended the Ponzi scheme from the beginning? Or do you think he did to try and stay afloat after the ship started to sink? I can’t imagine he would be stupid enough to think a fraud like this would actually work. 

    I don't think intent is relevant. I said earlier that the only thing that matters is the outcome. That said, no I do not believe that Clayton Morris ever set out to build a business to harm investors

    Agreed but regulators and the law does not look at it that way.. they look at results of your actions or inactions.. not your intent.

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  • Anthony Rosa
    Rental Property Investor · New York City · Member since 2019 · 703 posts · 538 votes
    6y

    Good stuff @James Wise and @Jay Hinrichs Nice work!

    What amazes me is how this guy is still getting mega viewers and followers.  Are people not aware that there is extensive internet and media coverage about sellers getting duped.  I do admit that Some of his content is good and he's obviously a great salesperson but could it be that 100's of buyers never visited their purchase.  I get it, checks are coming in so you think all is good but c'mon!  Apparently, there are cases of folks that bought condemned or non-existent properties. Was the title company in on this too?  What about county records? No attorney... Ever?

    I feel bad for these buyers and could only imagine what they are going through. Life savings flushed in the toilet, families torn apart over finances, embarrassment, losing all trust, etc... Effin Shame!

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  • Robert Collins
    Rental Property Investor · Greenville County SC / Atlanta, GA · Member since 2017 · 403 posts · 120 votes
    6y

    I heard that podcast about does mistakes exist, very good content lol but your right it does sound like a build up to something , I had no clue about the Morris invest fraud stuff , until I saw something on bp , then I went to watch the podcast episode 151 I think and it’s not on here anymore the show notes are but not the actually podcast , .....was there ever a time when Morris invest was legit and was doing things the right Way or  was it always a scam ? 

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  • Jim K.
    Handyman · Pittsburgh, PA · Member since 2018 · 5k+ posts · 13k+ votes
    6y
    Originally posted by @Robert Collins:
    .....was there ever a time when Morris invest was legit and was doing things the right Way or  was it always a scam ? 

    I am the pop of a mom and pop landlording outfit with multiple holdings in single-family-rental properties in this class in a similar city. I believe I have a solid understanding of how money can be made on a local level with these properties. I buy these properties cheaply, I renovate them myself, I fix pretty much everything that goes wrong with them while they are occupied, I do not have a property manager, I deal directly with my tenants. Lastly and most importantly, I am not a criminal.

    I am about as certain as humanly possible that anyone with significant personal experience running these properties could not possibly believe that Morris's business model was workable. I do not want to level unsubstantiated accusations at anyone, but I have real difficulty accepting that any of the actors involved in marketing this business plan had no criminal intentions.

    What I suspect is that both Clayton and Natali Morris vastly overstated the extent of their investing experience in these properties starting up Morris Invest, and that they then fell prey to experienced fraudsters who cheerfully fed their blossoming narcissistic delusions of personal grandeur and real estate knowledge mastery with wholly illegal intentions.

    "Denial ain't just a river in Egypt"

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  • Jay HinrichsBusiness Member
    OP
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    6y
    Originally posted by @Jim K.:
    Originally posted by @Robert Collins:
    .....was there ever a time when Morris invest was legit and was doing things the right Way or  was it always a scam ? 

    I am the pop of a mom and pop landlording outfit with multiple holdings in single-family-rental properties in this class in a similar city. I believe I have a solid understanding of how money can be made on a local level with these properties. I buy these properties cheaply, I renovate them myself, I fix pretty much everything that goes wrong with them while they are occupied, I do not have a property manager, I deal directly with my tenants. Lastly and most importantly, I am not a criminal.

    I am about as certain as humanly possible that anyone with significant personal experience running these properties could not possibly believe that Morris's business model was workable. I do not want to level unsubstantiated accusations at anyone, but I have real difficulty accepting that any of the actors involved in marketing this business plan had no criminal intentions.

    What I suspect is that both Clayton and Natali Morris vastly overstated the extent of their investing experience in these properties starting up Morris Invest, and that they then fell prey to experienced fraudsters who cheerfully fed their blossoming narcissistic delusions of personal grandeur and real estate knowledge mastery with wholly illegal intentions.

    "Denial ain't just a river in Egypt"

    exactly Jim.. model would never work then will never work in the future.. this is all hands on deck investing.. and not at all appropriate for the busy professional looking for their financial freedom number.. what a joke that say is anyway in my mind.. in the context of low end rentals.. its simply a business with your inventory being houses and your revenue being rent..  no different than buying a McDonalds and managing labor force and hamburgers are your revenue.. its a business.. 

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  • James WilcoxBusiness Member
    Real Estate Agent · Bowling Green KY ~ Lexington, KY · Member since 2015 · 1k+ posts · 601 votes
    6y

    @James Wise Thank you for pursuing this story! It needs to come out. I have dealt with these CC claims on YouTube a lot. I have never lost a case yet. It was likely just a stall tactic. I haven't seen the video but I bet you are not breaking any policies on Youtube. I will await your video and promote in on my channel as well. Word needs to get out. 

    @Anthony Rosa it is truly amazing he is still allowed to upload and produce videos with all of that going on. I have seen courts put a stop to new content in cases because the person was using Youtube in a way to promote their shady practices. This should be no different.

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  • AJ Singh
    Rental Property Investor · Orange County, CA · Member since 2016 · 512 posts · 374 votes
    6y

    @James Wise

    i am awaiting upload of video. 

    Hope OOS investors look at this video as a warning of investing in D class neighborhoods where numbers look too good. 

    It amazes how many investors dont even make a trip to their intended acquisitions to check the neighborhoods. Now marketplaces like Roofstock are fueling the " Being a landlord" dream. They are happily making middleman commissions with no liability over asset quality and property management. Already threads on BP about them.

    I do agree that people having lower down payments should look at syndications rather than invest in junk inventory.

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  • Jay HinrichsBusiness Member
    OP
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    6y
    Originally posted by @AJ Singh:

    @James Wise

    i am awaiting upload of video. 

    Hope OOS investors look at this video as a warning of investing in D class neighborhoods where numbers look too good. 

    It amazes how many investors dont even make a trip to their intended acquisitions to check the neighborhoods. Now marketplaces like Roofstock are fueling the " Being a landlord" dream. They are happily making middleman commissions with no liability over asset quality and property management. Already threads on BP about them.

    I do agree that people having lower down payments should look at syndications rather than invest in junk inventory.

    Issue is many of the lower tier investors don't qualify for syndication investments so they should stick to reits and income average and keep plunking money in just like the stock market  far better than owning some D class rental far afield.. never get rich doing that.

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