The state attorney general’s office has charged a Union County man with spending $241,000 for personal debt and expenses instead of investing it in a storage facility partnership in West Buffalo Township, as he told 10 clients he would.
Charges filed Monday against Ted Cresswell, 57, of Mifflinburg, are deceptive business practices, theft by deception and theft by unlawful taking, all felonies.
He was arraigned at 1:30 a.m. Monday before District Judge Lori Hackenberg and is free on $50,000 bail.
Special agent Michael Cranga, of the Pennsylvania Attorney General’s Office, began his investigation in June 2012 following complaints from several investors that they had received no money from Cresswell and were unsuccessful in getting their money back from him.
“I’m sorry this happened,” said one investor who asked not to be identified and who, like others, had given Cresswell $25,000. Ten investors are listed in the affidavit.
“We were in shock,” the investor said after learning of the attorney general’s investigation. “What can I say?”
It wasn’t until the project wasn’t proceeding that this investor realized something was wrong. The attorney general’s office contacted this investor last fall.
According to the affidavit Cranga filed, between February and July 2008, Cresswell sought investors for what was called A&A Storage Center Partnership. He told clients he would build a commercial storage rental facility on his land at Forest Hill and Johnstown roads in West Buffalo Township, the affidavit states.
Investors received a prospectus stating they could buy into the storage partnership for $25,000 a share, and their money would be kept in an interest-bearing account.
Under the deal, $40,000 of investors’ money would go to buy and transfer the property to the partnership from Cresswell and his wife, Sandra; construction of the facility would be done by Ted A. Cresswell Construction Inc.
If the project failed to happen, investors would get back their money, the prospectus said.
Instead, investigators said Cresswell took $171,000 for the land and didn’t transfer the property to the partnership. He also hasn’t returned any investor money although the project failed to happen.
Bank records obtained from Cresswell show he routinely deposited investor money into an A&A Storage account, then transferred the funds into his other business account, the affidavit states.
Cranga’s investigation found that Cresswell almost immediately used it for his own benefit, the affidavit states, mainly to pay off personal debts and expenses.
In a Dec. 7, 2012, interview with investigators, Cresswell admitted taking all the money. He said he stopped seeking investors for the project after the Federal Emergency Management Agency told him a change in flood elevation tables meant he couldn’t build the facility on the proposed site.
The investor who asked to remain anonymous said Cresswell also cited the change in flood zoning for the project’s holdup and promised to refund the money.
Cresswell said he paid himself $171,000 — not $40,000 — for what he determined as the land’s value and kept $70,000 for what he called pre-development costs.
According to the affidavit, court records show the fair market value of the property to be $31,680. Union County records show the property as still owned by Ted and Sandra Cresswell.
Cresswell could not produce documents to support his assertion of the change in property value or any pre-development, the affidavit states.
“We were really shocked,” the investor said about what happened, but still has faith in Cresswell. “I talked with Ted directly, and he promised he would get the money back. We’re hoping he’ll be as good as his word.”
This investor hasn’t spoken with any of the others involved.
A phone call for comment to the Cresswell home was not returned Tuesday.
Cresswell is set for a preliminary hearing before District Judge Jeffrey Mensch on March 26.
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