Banker Scott Coles and his wife at a charity event mere months before he killed himself and his company collapsed into bankruptcy

Here at DLT/Scoop Factory, we always love to hear from our readers. Even if you just want to say we suck and don’t know how to spell (complementary complimentary copyediting services are always appreciated).

However, a recent comment was so informative and heartfelt, that we decided it deserved its own post. It came in response to yesterday’s write-up on the long-awaited resurrection of the Centerpoint/West 6th Street towers looming over Downtown Tempe, as well as the project’s connection to Phoenix’s infamous ‘Tuxedo Suicide.’ One reader wrote in to tell us that it wasn’t just shady real estate developers and crooked bankers who were left holding the bag when longtime local lender, Mortgages Ltd., went belly up follwing the death of owner, Scott Coles (pictured). In fact, plenty of innocent people lost their life savings.

“Hello Scoop Factory – I would kindly ask everyone for some compassion by being a bit less ‘breezy’ in descriptions of the financial disaster that was the Centerpoint Condo’s…

Yes, it was made sensational by the tragic and strange suicide of Scott Coles … But it represented just the tip of the iceberg of a huge, Valley-wide real estate disaster that wiped out the retirement savings of a good many people, who had invested, in trust and good faith, with his company, Mortgages, Ltd.

My mother was one of those people …

“She invested nearly her entire savings from a life of labor, with Mortgages, Ltd., just a month before Scott’s suicide. She received just one interest-income check before the company went under after his death. Then the entirety of her money (and that of the many other ML investors …) fell — absolutely untouchable — into a black hole of bankruptcy proceedings, and is now being consumed as attorneys, appraisers and real estate agents get paid to sell these “investment properties” for pennies-on-the-dollar. (I often wonder if some of these same people might even have been involved in these same real-estate deals during the boom … making their money coming, and going).

Thousands of individual investors lost their life savings when Phoenix-based Mortgages Ltd. went belly up

Out of all the money invested with Mortgages, Ltd. — some part of it from small investors like my Mom — only as little as 5%-15% of the original principal may be gotten back by the actual investors ( … imagine having 90% of your savings disappear, overnight). And that’s not even considering the lost interest income, over the past 3 years, my Mom was counting on for living expenses. She is now living with us, very frugally, on just her Social Security check and what’s left of some cash savings we held out of the ML investment, for emergencies.

So, consider perhaps that the reason those “luxury condo’s” may be available for such reasonable prices is because of the money lost by investors like my Mom in the Mortgages, Ltd. debacle … That money paid for buying the land and building the original buildings, which have now been sold for nowhere near what was originally put into them.

Thank you for your understanding in this matter …”

Tom H.

Images via Phx New Times & AZ Central

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