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Investors behind Idaho Springs gondola say they’re victims of fraud, sue loan broker and escrow agent

The Mighty Argo Cable Car group argues “fraud has been committed,” but promises the $32 million project to build a gondola resort complex will be completed

The owners of the Argo Mill and Tunnel are planning the Mighty Argo Cable Car gondola from the banks of Clear Creek in Idaho Springs to a mountain top park as the spark to a massive redevelopment of the historic gold mill. (Jason Blevins, The Colorado Sun)
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The investment group planning a gondola-anchored resort village at Idaho Springs’ long dormant Argo Mill is suing a loan broker and escrow company, arguing they are victims of a comprehensive fraud scheme.

The 55-investor Mighty Argo Cable Car Group in August 2020 deposited $4.5 million into an escrow account with Virginia-based First Title Inc. That was the equity deposit on a $32.37 million construction loan brokered by Dallas-based Trivecta Capital Group and its owner, Jay Matthiesen. 

The construction loan never followed the deposit. And the Mighty Argo group has been unable to get its $4.5 million back from First Title, which is owned by a woman named Sandra Bacon. The lawsuit alleges Bacon has transferred the $4.5 million into another account and will not return the money.

“These defendants’ conduct was fraudulent, malicious, willful and wanton,” reads the complaint against Bacon, First Title, Trivecta and Matthiessen filed last week in U.S. District Court in Denver.

The Mighty Argo plan calls for a 1.2-mile scenic gondola climbing from the EPA Superfund site at the Argo Mill on the banks of Clear Creek up to the 450-acre Virginia Canyon Mountain Park owned by Idaho Springs. The long-term plan includes a hotel, homes and commercial village surrounding the historic Argo Mill. (The mill is the red structure towering above Idaho Springs where intrepid miners 125 years ago bored nearly 5-miles into the mountains to access what was once considered the continent’s largest cache of gold.)

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The plan is a big deal for Clear Creek County, which has long struggled to lure tourists off Interstate 70 as they whiz toward ski resorts and alpine enclaves deeper in the mountains. The plan called for as many as 400,000 annual visitors, riding gondola cars toting bikes to a mountaintop plaza and a maze of trails. Construction began in October but halted in February, when the construction loan money did not come through and the developer could not get its escrow deposit back.

Mary Jane Loevlie, the Idaho Springs entrepreneur spearheading the Argo cable car project and village development, said there is no doubt the project is going to go forward. 

“Remember, when we purchased the Superfund site in 2016, no one thought a Superfund would work,” she said. “We have turned this into a viable project that will be a huge economic engine for Idaho Springs and the region.” 

Developer and businesswoman Mary Jane Loevlie listens during the November 2019 unveiling of the Mighty Argo Cable Car gondola project, which she and other developers are spearheading at the historic Argo Gold Mill and Tunnel. (Andy Colwell, Special to the Colorado Sun)

Support for the project from local leaders and investors remains “overwhelming,” said Loevlie, whose plan blends heritage tourism and recreation with homes and lodging. 

“We are going to bring back the economic engine that Argo was at the turn of the century,” she said. “We are looking at this as a bump in the road. We will get over it and the project will be completed. This will be another great chapter in our book.”

The $32.8 million construction loan included $800,000 for land acquisition, $8.3 million for the Leitner Poma gondola, $12.1 million for the Argo Landing loading facility on the banks of Clear Creek, $2.3 million for the top plaza and $4.7 million for a three-story parking garage.

Bacon and her First Title escrow company last year were accused of fraud in a similar lawsuit in Texas. Aspen-based investor Deborah Tomlinson in late 2019 deposited $1.25 million into a First Title escrow account as an equity investment in an $8 million plan to create a company that cleaned industrial equipment in refineries along the Gulf Coast. 

Read more outdoors stories from The Colorado Sun.

Shortly after Tomlinson deposited $1.25 million with Bacon and First Title, the escrow company “unlawfully and without permission” released the money to partners in the company who “absconded with the money and have diverted and converted the money for their own uses,” according to a complaint filed in Texas District Court in July.

“The escrow agreement with First Title, as well as the supposed escrow account, was nothing more than a sham intended to give defendants’ fraudulent scheme an air of legitimacy,” reads the Tomlinson complaint.

“My clients deny all allegations as pled in the lawsuit and will be defending against the lawsuit shortly,” said Derek Deyon, the attorney for Bacon and First Title, in an emailed statement addressing the Mighty Argo complaint. The resolution of the Tomlinson case against Bacon and First Title is pending, per court documents.   

Matthiesen and Trivecta also are facing similar charges in Texas. A California developer in January filed a lawsuit in Dallas County’s 192nd Civil District Court arguing Matthiesen and Trivecta illegally obtained funds deposited into an escrow account as part of a loan deal for an apartment project.

Anthony Leffert, an attorney representing the Mighty Argo group, said the complaint is more than a misstep in a complex financial deal. 

“This is not your typical escrow case,” Leffert said. “We are arguing fraud has been committed here.”

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