Who is Michael Anthony Prieskorn?

People in this city don’t know the 35-year-old man who was indicted in January in connection with an alleged $5 million mortgage fraud scheme.

When asked Wednesday, not one person at the barber shop, a day care, city hall or the community center knew Michael Anthony Prieskorn. But according to a U.S. attorney’s office news release, he is from Ellendale. He has appeared in news accounts statewide with the city’s name right behind his.

The Albert Lea Tribune on Wednesday knocked on the door of two people who definitely know him — parents David and Sylvia Prieskorn of 10759 SW 52nd Ave. four miles north of Ellendale.

David Prieskorn came to the door; however, he declined to comment.

Rural Ellendale resident Helen Schmidt lives on the same road as the Prieskorns.

“I know everyone else along this road, but not them,” she said.

The residence is the address in the case because it is his last known address in Minnesota.

According to a grand jury indictment handed down Jan. 20 in U.S. District Court for the District of Minnesota, Michael Anthony Prieskorn and Richard Mathew Laho, 54, of Buffalo, received money from investors to purchase more than 70 residential properties in Minnesota and Florida between December 2006 and April 2007.

According to a news release from B. Todd Jones, U.S. attorney for the District of Minnesota, Prieskorn was arrested in Florida on Jan. 25, three years after fleeing Minnesota. Authorities made the public aware of the indictment following the arrest.

The two men are charged with 23 counts of wire fraud, one count of mail fraud, and one count of conspiracy to commit wire fraud. Prieskorn also was charged with two counts of engaging in an illegal monetary transaction.

On Feb. 10, Prieskorn and Laho entered pleas of not guilty before U.S. Magistrate Judge Franklin Noel. A trial is slated for May before Judge Paul A. Magnuson.

Jim Johnson, who has been a barber in Ellendale for 38 years, said he remembers reading the story in newspapers.

He figured it was another case of Ellendale’s misshapen zip code, which runs down to near Geneva and finds its way farther north than Hope. He said sometimes people who live closer to other cities have a 56026 zip code.

But being four miles north of town, that’s even within the Ellendale portion of the consolidated New Richland-Hartland-Ellendale-Geneva School District. Johnson figured they must not ever socialize with the community.

The same conclusion was had by day care provider Becky Lassahn. She said a friend of hers has been wondering who Prieskorn was.

“People make mistakes, but problems happen when they are allowed to keep doing it still,” Lassahn said. “I never let my sons get away with anything.”

Ellendale City Clerk Steve Louks said perhaps the Prieskorns spent their time in the Twin Cities or Owatonna, rather than in the small town they lived near.

Prieskorn and Laho, the indictment alleges, used the business names Blackstone Sales and Maine Estates.

Laho, a mortgage broker, worked with Prieskorn to solicit investors with good credit histories to buy some of the properties, allegedly telling them the mortgage loans and the deals themselves would be risk-free. They also allegedly promised each investor $5,000 for every property purchased, and Blackstone Sales or Maine Estates would maintain the properties, make the monthly mortgage payments in addition to paying other related expenses, and, ultimately, sell the properties.

They would make investors appear qualified for loans by temporarily depositing money in their accounts, without the lenders knowing, the indictment says.

After closing, Prieskorn allegedly received “management fees” that ranged from $18,000 to $228,000 per property and that totaled more than $5 million. As the duo failed to pay the mortgage payments, they sent a “lulling” letter to investors, saying Blackstone Sales had been acquired by Sydney & Lloyds.

If convicted, Prieskorn and Laho face a maximum of 20 years in prison on each wire fraud count, mail fraud count and conspiracy count. Prieskorn faces 10 years in prison on each monetary transaction count.

The case was the result of an investigation by the Internal Revenue Service, Eagan Police Department, Minnesota Department of Commerce, U.S. Secret Service, the Minnesota Financial Crimes Task Force and the Minnesota Bureau of Criminal Apprehension.

Though the indictment is for the 70 cases, the Minnesota Department of Commerce investigation pointed to 220 “builder bailout schemes” in Minnesota and Florida involving Prieskorn. The department in April revoked Prieskorn’s mortgage originator license and fined him $2.2 million.