Owners of gang-infested apartment complex under investigation fo - WMC Action News 5 - Memphis, Tennessee

Owners of gang-infested apartment complex under investigation for Ponzi scheme

(WMC-TV) - A group of local pastors rescheduled a gang peace summit because of what they call "horrific dangers" at the apartment complex where the summit was supposed to be held.

Meanwhile, Action News 5 learned the company managing the complex is under investigation for an alleged Ponzi scheme.

The property has been bought and sold three times to one buyer at the same Utah address.

The Securities and Exchange Commission has frozen that buyer's assets and local pastors say the property has turned into the "Wild West".

A series of violent gang crimes at Montera Park Apartments on Kingsgate in Whitehaven sent the Memphis Southern Christian Leadership Conference into action.

They are planning a Gang Peace Summit.

"Whether it's behavioral services they need, whether it's mental illness, whatever it may be, we want to help put them in a position to deal with life's issues," said Herb Jackson, of the Memphis SCLC.

In May, a mom survived a gunshot, after telling the Kingsgate Mafia Gang to stop recruiting her daughter.

In June, a 16 year old died from a gunshot wound at the same apartment complex.

SCLC's Herb Jackson realized the dangers at the 300-unit property when police had to escort them with assault rifles, as ministers held a prayer march at the complex two weeks ago.

"The place is extremely desolate; their weeds are standing three to four feet tall. A lot of the place is vacant and boarded up," said Jackson.

Action News 5's Kontji Anthony took a closer look at who owns the property and uncovered some shocking revelations.

According to a nuisance order filed by the Shelby County D.A.'s office in May 2010, the property is managed by the now excommunicated Jesus Christ of Latter-Day Saints Bishop Wendell A. Jacobson.

The Federal Securities and Exchange Commission froze Jacobson's assets in December 2011, alleging he orchestrated a $220 million Ponzi scheme, with more than 200 victims in eight states.

The SEC says victims were led to believe they would make money off of the renovation and resale of low-income properties, but the Jacobsons were siphoning money to pay for family expenses.

On top of that, there is a bankruptcy filing that leaves the property in more confusion.

"Because of this Chapter 13 filing and the fact that the owners are out of state, this thing has come to a standstill at this point," said Jackson.

That is why neighbors say Kingsgate Mafia feels empowered to run the complex on their terms.

"They feel brazen, they feel like nobody can or will do anything about their activities and that's just not true," said Jackson.

The Gang Peace Summit is Saturday at 4 p.m. at Annesdale Cherokee Baptist Church on Kimball Avenue.

Meanwhile, investigators describe the property owner as the Bernie Madoff of Utah. They say it is the largest fraud case in Utah history.

The SEC, Utah U.S. Attorney, FBI, and IRS are on the case.

There is no telling what the investigation means for the fate of the property.

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