news-107290333-ar-0-0.jpg
James Charles Nistler, sits on the stand in Jackson County Circuit Court Friday in Medford, where Judge Tim Gerking heard arguments over the level of restitution Nistler should make to victims in the wake of his conviction on fraud, theft and racketeering. - Julia Moore

Convicted developer ordered to pay victims

Medford developer, mortgage broker and convicted racketeer James Charles Nistler must pay more than a quarter million dollars in restitution to bilked investors, a Jackson County Circuit Court judge has ruled.

Judge Timothy Gerking ruled late Thursday that Nistler must pay a total of $257,611 to five victims of his ill-fated real estate development scheme. The payment amounts range from $28,000 to $78,000, court documents show.

In his six-page ruling handed down Thursday afternoon, Gerking wrote that the state proved its case that the dollar losses sustained by the victims met the legal threshold required for restitution.

"Some victims incurred a partial or an entire loss of their real estate investment," Gerking said. "I also find that the jury, by virtue of its verdict, has already found a causal nexus between the victims' economic loss and the defendant's criminal conduct."

Nistler, 80, was convicted unanimously in a November 2010 jury trial on one count of racketeering, eight counts of securities fraud and eight counts of first-degree aggravated theft. He remains free on bond as he appeals his 19-month prison sentence.

Nistler was a high-ranking official with the U.S. Department of Housing and Urban Development in the late 1980s and claims to have built more than 800 homes in Jackson County.

At a restitution hearing in June, Gerking heard arguments from prosecutor Rachel Bridges and Nistler's attorney, Michael Kellington.

Kellington has maintained the case is rife with issues that will be brought up before the Oregon Court of Appeals. Kellington also blames the failed real estate market for killing any chance of a speedy recovery. The victims' own failure to act in the face of the downward economic spiral created their losses, not his client, Kellington said.

Bridges said Nistler was convicted on all counts by a jury of his peers. Nistler took in $1.2 million from investors purportedly to build houses, but actually spent less than $400,000 of the money on the project, Bridges said.

The prosecutor sought to add $47,000 to that amount for two more victims to an initial financial restitution amount of $304,000. Most of Nistler's victims are elderly and don't have the luxury of time to recover their losses. One victim is now in a nursing home, she said.

Gerking on Thursday denied the extra restitution. The two parties who might have received it had foreclosed on their securities, "which had a value considerably higher than their investments," Gerking wrote in his decision.

"For that reason, I find that they did not sustain an economic loss ... or that their loss, to the extent that they might still suffer loss, has not been established with reasonable certainty," he wrote.

Gerking took about six weeks to render his decision, noting at the restitution hearing that he was neither the trial judge nor the sentencing judge in the complex case.

Judge Ray White presided over the original trial. In December 2010, he stated it was clear that Nistler played fast and loose with other people's money before sentencing him to 17 months on the racketeering charge, 13 to 19 months on the theft charges and 12 months on the fraud charges. He set all the sentences to run concurrently.

Judge Lorenzo Mejia handed down the 19-month prison sentence after White's retirement. Nistler was to report to jail Jan. 24. But Mejia ruled Nistler could remain free on bond pending his appeal. However, if the Oregon Court of Appeals upholds Nistler's conviction, he must begin serving his sentence, even if he plans to continue his appeal to the Oregon Supreme Court, Mejia ruled.

Reach reporter Sanne Specht at 541-776-4497 or email sspecht@mailtribune.com.

Share This Story