Live Well CEO Michael Hild’s trial is set for Oct. 13, 2020. (BizSense file photos)
Embattled local businessman Michael Hild isn’t going down without a fight.
The founder and CEO of collapsed Chesterfield-based mortgage company Live Well Financial on Thursday pleaded not guilty to federal criminal charges of securities fraud, mail fraud and bank fraud.
Hild, 44, made his plea in federal court in Manhattan, New York, before Judge Ronnie Abrams, who set a trial date in the case for Oct. 13, 2020.
Hild was arrested on the charges in Richmond on Aug. 29, but will remain free until the trial on a $500,000 bond, which required he surrender his passport and not leave the state other than for legal matters in New York.
He also is facing civil charges filed last week by the Securities and Exchange Commission, to which he has yet to respond. The not-guilty plea does not apply to the civil charges.
The crux of the government’s case alleges that Hild steered a scheme to fraudulently inflate the value of Live Well’s portfolio of complex reverse-mortgage bonds to induce lenders to loan the company tens of millions of dollars more than they normally would have.
The government called the scheme a “self-generating money machine” that overinflated the value of the bonds by $140 million. Authorities allege Hild used the loans to wrest full control of the company’s shares by buying out its preferred stockholders and in turn increase his compensation to approximately $5 million in 2016, approximately $9.7 million in 2017 and over $8 million in 2018.
Also charged in both the criminal and civil cases are Live Well CFO Eric Rohr and Executive Vice President Darren Stumberger. They have pleaded guilty in the criminal case and have consented to partial judgements on the civil matter. They are both cooperating with authorities.
Hild is represented by attorney Steven Feldman and William Donnelly of law firm Murphy & McGonigle. They did not respond to a request for comment.
Upon his arrest and arraignment last week, Hild’s attorneys said in a prepared statement he is “deeply disappointed that the Government has chosen to respond to the business failure of Live Well Financial by alleging corporate fraud.
“While Live Well unfortunately failed, every business failure is not a corporate crime.”
Hild is represented in the civil case by attorney Vernon Inge of Whiteford Taylor & Preston.
Hild, a former Capital One executive, launched Live Well on April Fool’s Day 2005, eventually basing the company in the Boulders office park in Chesterfield.
The company, which originated, wholesaled and serviced reverse mortgages, grew to be listed among the region’s fastest-growing businesses as recently as 2014.
The company had upwards of 300 employees at one point, including at an office in San Diego, before collapsing with little notice or explanation in May.
A message on Live Well’s website regarding its closure earlier this year. Click to enlarge. (Screenshot)
In addition to his bond requirements, the government said it has obtained a post-indictment restraining order to preserve Hild’s assets, “including various real properties and business interests in the Richmond area – owned directly or indirectly by Hild and, as alleged, purchased with proceeds of the scheme.”
Hild and his wife Laura, who is not named in either the criminal or civil cases, in recent years amassed dozens of properties in and around the Manchester neighborhood in Southside Richmond. The acquisitions were made through LLCs that are now largely in Laura’s name. However, Hild publicly represented himself as part of the various ventures.
They’ve since redeveloped several of those properties and opened businesses in the spaces, including the recently opened Dogtown Brewing Co. brewery and restaurant at 1209 Hull St.
The couple also runs an oyster farming venture, Anderson’s Neck Oyster Co.
Live Well CEO Michael Hild’s trial is set for Oct. 13, 2020. (BizSense file photos)
Embattled local businessman Michael Hild isn’t going down without a fight.
The founder and CEO of collapsed Chesterfield-based mortgage company Live Well Financial on Thursday pleaded not guilty to federal criminal charges of securities fraud, mail fraud and bank fraud.
Hild, 44, made his plea in federal court in Manhattan, New York, before Judge Ronnie Abrams, who set a trial date in the case for Oct. 13, 2020.
Hild was arrested on the charges in Richmond on Aug. 29, but will remain free until the trial on a $500,000 bond, which required he surrender his passport and not leave the state other than for legal matters in New York.
He also is facing civil charges filed last week by the Securities and Exchange Commission, to which he has yet to respond. The not-guilty plea does not apply to the civil charges.
The crux of the government’s case alleges that Hild steered a scheme to fraudulently inflate the value of Live Well’s portfolio of complex reverse-mortgage bonds to induce lenders to loan the company tens of millions of dollars more than they normally would have.
The government called the scheme a “self-generating money machine” that overinflated the value of the bonds by $140 million. Authorities allege Hild used the loans to wrest full control of the company’s shares by buying out its preferred stockholders and in turn increase his compensation to approximately $5 million in 2016, approximately $9.7 million in 2017 and over $8 million in 2018.
Also charged in both the criminal and civil cases are Live Well CFO Eric Rohr and Executive Vice President Darren Stumberger. They have pleaded guilty in the criminal case and have consented to partial judgements on the civil matter. They are both cooperating with authorities.
Hild is represented by attorney Steven Feldman and William Donnelly of law firm Murphy & McGonigle. They did not respond to a request for comment.
Upon his arrest and arraignment last week, Hild’s attorneys said in a prepared statement he is “deeply disappointed that the Government has chosen to respond to the business failure of Live Well Financial by alleging corporate fraud.
“While Live Well unfortunately failed, every business failure is not a corporate crime.”
Hild is represented in the civil case by attorney Vernon Inge of Whiteford Taylor & Preston.
Hild, a former Capital One executive, launched Live Well on April Fool’s Day 2005, eventually basing the company in the Boulders office park in Chesterfield.
The company, which originated, wholesaled and serviced reverse mortgages, grew to be listed among the region’s fastest-growing businesses as recently as 2014.
The company had upwards of 300 employees at one point, including at an office in San Diego, before collapsing with little notice or explanation in May.
A message on Live Well’s website regarding its closure earlier this year. Click to enlarge. (Screenshot)
In addition to his bond requirements, the government said it has obtained a post-indictment restraining order to preserve Hild’s assets, “including various real properties and business interests in the Richmond area – owned directly or indirectly by Hild and, as alleged, purchased with proceeds of the scheme.”
Hild and his wife Laura, who is not named in either the criminal or civil cases, in recent years amassed dozens of properties in and around the Manchester neighborhood in Southside Richmond. The acquisitions were made through LLCs that are now largely in Laura’s name. However, Hild publicly represented himself as part of the various ventures.
They’ve since redeveloped several of those properties and opened businesses in the spaces, including the recently opened Dogtown Brewing Co. brewery and restaurant at 1209 Hull St.
The couple also runs an oyster farming venture, Anderson’s Neck Oyster Co.
Can’t wait to hear the defense for this one…should be interesting.
The SDNY doesn’t lose in court.
Hild’s lawyers sure will win though – looks like they’ve found the *real* self-generating money machine; 13 months of billable hours for a doomed case.