MEMPHIS, TN (WMC) - A Tennessee administrative judge has issued an order against a Memphis man with a three-year penchant for posing as a licensed real estate agent in order to steal rental deposits.
Judge J. Richard Collier, director of the Tennessee Secretary of State's Administrative Procedures Division, has ordered John Ferguson, 46, of Midtown Memphis, to pay $5,000 in civil penalties. According to the order, the penalties are for five separate acts since 2014 in which Ferguson acted as a real estate leasing broker for property owners, collected rental deposits, then kept the money when he "...was not licensed to perform such actions."
The WMC Action News 5 Investigators were alerted to Ferguson by RJ Property Management of East Memphis. The company's bookkeeper, Jeffrey Bradsher, said Ferguson approached the company in March about being an independent contractor to recruit renters.
"He said he was a leasing agent," Bradsher said. "He said he had some experience leasing other properties for people.The arrangement was that he would go out and try to lease our properties for us. If he found people who were available, the money would come into the office right after (the renter) paid an application fee and security deposits."
Bradsher said Ferguson had solicited two prospective renters for RJ Property Management before the company realized something was wrong. One of them was Chris Hogan of East Memphis. Receipts revealed in March, Hogan paid Ferguson nearly $1,300 as a deposit on one of the company's Southeast Shelby County rental properties. Hogan said Ferguson had access to the property, gave him a tour of the property, but after he paid Ferguson the cash, Ferguson stopped answering his calls and texts.
"After he took my money, I never heard from him again," Hogan said. "He represented himself as property management"
"Mr. Ferguson never talked to us about Mr. Hogan," Bradsher said. He confirmed RJ Property Management had no idea Hogan was touring its rental property.
Ferguson simply took Hogan's deposit, vanished, then suspended all contact with both Hogan and RJ Property Management.
"I didn't expect to get, you know, robbed," Hogan said.
The Better Business Bureau of the Mid-South has kept a record on Ferguson and his front company, Mid-South Property Services, for three years. The bureau gave Ferguson's company a F-rating for five unanswered complaints over that period. Each alleged Ferguson collected rent or deposits for landlords, than ran off with the money.
"Those certainly are allegations that we've gotten, that he's not sending rent payments on to the landlords," Mid-South Better Business Bureau President Randy Hutchinson said. "As a layman, I would call that theft."
The real estate commission's file on Ferguson provides detailed accounts, alleging he has pulled the same scam on five victims since 2014. Some are property managers. Others are prospective renters, like a Piperton, Tennessee, couple who sued Ferguson and won a $465.50 judgment for stealing their rental deposit while operating as an unlicensed leasing agent. The lawsuit's file and the couple confirmed Ferguson has never paid the judgment.
Walters said Ferguson also failed to show in Nashville at a 2015 hearing for unlicensed real estate activity. The real estate commission proceeded on a default motion, winning a $2,000 penalty against Ferguson, who never paid. It was our inquiry that spurred Collier to revisit the case and increase the penalty to $5,000 -- $1,000 for each party Ferguson schemed while acting as an unlicensed agent. He has 30 days from the order's date to pay the penalty.
The problem is state regulators, property managers and renters have had trouble finding Ferguson. According to public records, Ferguson has filed for bankruptcy ten times. He has 11 property liens filed against him and four civil judgments. His last owned property was in Olive Branch, Mississippi, but he no longer owns it.
Acting on a tip, we found him in Midtown Memphis outside 224 Hawthorne Street, a home converted into apartments. When confronted with the judge's order and his history of unlicensed real estate activity, Ferguson said, "Yeah, I'm not interested. I'm not talking with you, OK?"
Everything we found on Ferguson -- the judge's order, Ferguson's negative history with the real estate commission, his lack of a license, his BBB file -- is a matter of public record and is easily accessible. Yet RJ Property Management never checked Ferguson's background before hiring him to recruit renters.
"We didn't do a background check or anything like that," admitted Bradsher. "We've never been burned like this before. You learn from your mistakes, right?"
Anyone can check a real estate or leasing agent's license and disciplinary history right from Tennessee's license verification database: verify.tn.gov. In Mississippi, check the Mississippi Real Estate Commission's license tool: appserver.mrec.ms.gov/findlicensee. In Arkansas, use the Arkansas Real Estate Commission's license tool: https://www.ark.org/arec_renewals/index.php.