Money from bonds that was supposed to be used to build an apartment complex here is still missing, and the Clearfield Housing Authority is starting an investigation.
Lawsuits have been filed in connection with the $7 million bond issue, and attorneys were on hand Tuesday night to try to tell housing authority members where everyone stands.But members did not get the answers they wanted, so they're getting their own attorney involved.
The missing money became an issue two weeks ago when officials became concerned that the 180-unit apartment complex was behind schedule. The developer had yet to seek a building permit.
In 1985 the housing authority issued $7 million in bonds to a development company called Heather Estates for the project, which was to be completed by the end of this year.
Housing authority members asked developer Gary Routh to attend Tuesday's meeting to explain where the money is. Routh didn't show, but he sent his attorney.
Members learned that the missing millions could still be somewhere in Utah, or the money could have been eaten up in a national banking fraud involving billions of dollars.
Representing Heather Estates was Salt Lake attorney Brad Parsons, who said that some of the money was given to a Salt Lake banking institution called Residential Mortgage.
When he asked for a transfer of money to begin construction of the apartment complex, Parsons said Ed Higley of the mortgage company said he didn't have it. So Parsons filed a lawsuit against the former Salt Lake City mortgage company on behalf of his client.
Residential Mortgage Company attorney Harold Stephens, also present at the meeting, explained that the mortgage company had been dissolved in 1984, so it was not involved in the transfer of any money.
Stephens said that in his opinion, the bond money is sitting in an account at an institution called Mony of New York. He recommended to the housing authority that they default on the bonds to minimize any liability against the city.
Higley then told members that he had talked to Routh about the bonds back in 1984, but he turned down any deal other than to sell the developer the land.
"I was not involved in that project in any way, knowingly," Higley said.
Higley said he has seen some signed documents with his name on them, but he did not sign any papers involving the bonds. Higley said forgery may be involved.