Michael Litz and Michael Fox's Bellington Realty cashed in during the boom, but its customers got stuck in the bust

Michael Litz and Michael Fox's Bellington Realty cashed in during the boom, but its customers got stuck in the bust

In June 2010, when Michael and Donna Dunlap last saw Michael Litz — co-owner of the Bellington real estate companies and now an FBI target — he stood inside his corner office in downtown Clayton, sweating.

This wasn't the same confident 54-year-old with fluffy, blizzard-white hair who had sold them a home in Kirkwood a year earlier.

"His demeanor was different," recalls Michael Dunlap.

The downtown Clayton headquarters of Bellington and its many affiliates (such as 
Eighteen Investments) at 226 South Meramec Avenue.
Jennifer Silverberg
The downtown Clayton headquarters of Bellington and its many affiliates (such as Eighteen Investments) at 226 South Meramec Avenue.
Roderick Bishop and Kristy Cruz, seated outside their rental house in Benton Park West, believe Bellington has taken them for a ride.
Jennifer Silverberg
Roderick Bishop and Kristy Cruz, seated outside their rental house in Benton Park West, believe Bellington has taken them for a ride.

The house in question had needed some work. Such was Bellington's specialty: buying midrange properties in bulk, then selling them as-is, often to buyers who didn't qualify for traditional mortgages.

The Dunlaps had paid Litz in full within a month of closing. They knew Litz still held a mortgage on the home, but they believed his assurances that he would use their funds to pay it off.

Yet now, as they stood before him in June 2010, the bank was about to foreclose on their house. Litz had cashed their checks, but apparently hadn't paid off the mortgage. And after weeks of tense exchanges, the Dunlaps demanded answers. They told Litz he was forcing them to do things they didn't want to do.

"That was the first time I saw Mr. Litz look concerned," says Michael, adding one more curious detail: During their conversation, a young lady in Litz's office was pushing "stack after stack" of paper through the shredder.

"It was probably irrelevant," Michael says. "But it did cause me concern."

The Dunlaps are now among a half-dozen St. Louisans who believe themselves victims of shady home transactions — and are suing Litz, his long-time business partner Michael Fox, Bellington and its affiliate, Eighteen Investments. (At least 24 limited-liability companies are registered to one or both of the partners; all are commonly referred to as "Bellington.")

All of the plaintiffs, the RFT has confirmed, have spoken to the FBI.

Bellington's legal troubles don't end there. Since January 2009, no fewer than fifteen banks, one insurance company and one title company have filed suit against the partners and their companies in St. Louis County, claiming a collective debt of more than $32 million. Many of these cases have been settled, but nine are still winding through the courts.

To some extent, Litz, Fox and Bellington are themselves victims. Their business model depended on ever-rising home prices. But now the market has soured, credit has dried up and banks have no appetite for real estate. That means the company is sitting on a large inventory of houses that nobody wants, even as the banks that once begged for their business with them have called in their loans.

Which may explain why they owe hundreds of thousands in back taxes to the city and the county, not to mention $57,400 to the federal government. And why, in the past 28 months, 154 of their properties have come under foreclosure in the county alone. [Editor's Note: A correction was made concerning this paragraph. Please see the end of the article.]

Yet some creditors feel no pity for Bellington. Richard Miller, chairman of Truman Bancorp, says that Fox and Litz claimed a large net worth for themselves and their company in order to get the loans in the first place.

"Even if that net worth went down by 50 percent, they'd still have enough to meet their obligations to us," he says. "Very few things just disappear. But in this case it all has, more effectively than David Copperfield makes a live elephant disappear. And the only way assets can disappear is that they're concealed, or they weren't there to begin with."


Michael Litz and his partner, Michael Fox, had already been running a successful business when the real estate market heated up in the early- to mid-2000s. Area home prices, which, according to St. Louis Real Estate News, had been rising nonstop since 1993, ticked up sharply. All you needed to get financing, it seemed, was an ink pen.

As three different cable networks aired reality shows on flipping houses, foreclosure auctions in St. Louis grew crowded. Cartoon mascots such as "Archie" and "Ug" competed on billboards for the opportunity to gobble up your ugly house. In short, it was a good time to be in residential real estate. And nobody was moving units like Bellington.

"They bought a much larger quantity of homes than anyone else," says local developer Pete Rothschild, who himself bought his last two homes from Bellington-affiliated agents. "They were head and shoulders above the rest."

By all accounts, Litz acted as the salesman, while Fox concentrated on keeping the books. (Owing to health issues, Fox has reportedly kept a low profile in day-to-day operations for the last year or two and did not respond to phone calls seeking comment.)

As the market grew, regional banks smelled opportunity, says attorney Vince Vogler Sr., who is now representing Litz.

"They were lining up to lend him money," Vogler says. And, he adds, his client made the banks a lot of dough in interest payments — otherwise, they never would have lent him as much as they did.

And while Vogler admits that Litz wanted to turn a profit, he says the businessman also genuinely enjoyed shepherding people into their first homes. Those people number in the thousands, Vogler says. Some even sent thank-you cards.

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