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The Athens Metropolitan Housing Authority that was a victim of embezzlement is now being sued over its former director’s debt
By: David Forster
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ATHENS, Ohio (WOUB) — Late last year the Athens Metropolitan Housing Authority, which helps low-income people with housing, discovered its executive director had embezzled more than $1.5 million.
The unfortunate irony here is the home was given to the agency as partial restitution for the money that was stolen from it.
And now, depending on how the case turns out, it may have to sell the home to pay off the mortgage.
The case turns on a legal concept: lis pendens, which is Latin for lawsuit pending.
In early February, Jodi Rickard was indicted for embezzling more than $1.5 million from the Athens Metropolitan Housing Authority.
Rickard had worked for the agency for many years and became its executive director in 2020. The indictment followed an investigation late last year by the state auditor’s office, which found that Rickard had for years been using housing authority funds for personal expenses, including vacations and an in-ground pool at her home.
Rickard pleaded guilty in June, and as part of her plea deal, she agreed to forfeit her interest in her Albany home. Her husband, Kevin, voluntarily agreed to forfeit his interest in the home as well. Ownership of the home was later transferred to the housing authority.
It turns out that 10 days before the February indictment, Jodi and Kevin had taken out a $150,000 mortgage on their home through Rocket Mortgage.
Then two days after the indictment was filed, the judge overseeing the case issued a corrupt activity lien against the home and the 8 acres it sits on.
A lien is a legal claim for a debt. Liens typically come up in civil cases, such as when a bank forecloses on a home because the homeowner isn’t paying the mortgage. The bank can then sell the home to pay off the loan.
A corrupt activity lien may be used in a criminal case so that property or other assets owned by a defendant can be used to help cover whatever restitution the defendant is ordered to pay in the case.
Property may be subject to more than one lien, such tax liens or second mortgages, and other parties may also have some kind of legal interest in the property.
When legal action is taken that involves property, those with a legal interest in the property have a right to know about it in case it might affect their interest. This is lis pendens.
Under the law, the filing of a lawsuit — also known as a complaint — is considered to be sufficient notice to any parties who might have an interest. In other words, no special notice has to be sent to anyone who isn’t directly involved in the lawsuit. Instead, the complaint itself constitutes lis pendens.
To put this another way, if someone has a legal or financial interest in property, it’s up to them to protect their interest by routinely checking complaints filed in court that involve the property. These checks are typically done on the civil side — not criminal — because that’s where the vast majority of complaints involving property are filed.
But in Rickard’s case, the forfeiture of her home happened in the criminal case. And Rocket Mortgage is now arguing that it was not put on notice that its interest in the home — the $150,000 mortgage — might be affected by the outcome of the case. In other words, it’s saying there was no lis pendens.
The judge in Rickard’s case said the corrupt activity lien itself constituted lis pendens. Legal experts interviewed for this story, who agreed to talk on background only, said that a lien and lis pendens are two different things. They were not aware of any other cases where a lien such as this has been treated as lis pendens and therefore considered sufficient notice to third parties with an interest in the property.
Had the forfeiture of the home instead been handled through a separate civil action, the filing of that civil complaint would have constituted lis pendens and Rocket Mortgage would have no claim that it wasn’t put on notice.
Legal experts said one possible outcome in this case is that a judge could agree there was no lis pendens and order the home be put up for sale at auction to the highest bidder. The proceeds would be used to pay off the mortgage and anything left over would be kept by the Athens Metropolitan Housing Authority.
Or the Athens Metropolitan Housing Authority could list the house for sale itself, which would likely fetch a higher sales price with more money left over. The home is appraised by the Athens County auditor at $189,000.
The next step in the case is the housing authority will file an answer to the lawsuit, which was filed Monday in Athens County Court of Common Pleas.