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Connolly to face judge's questions
By JEFF TESTERMAN, Times Staff Writer
Why did he lie about his criminal history when he filled out a state application to get a notary license to use in his controversial real estate business? Wednesday, the Hillsborough state attorney charged Connolly with perjury, a felony, for lying on the state form. Why did he repeatedly skip court-ordered restitution payments of $750 a month arising from a 1997 tax fraud case? Earlier this year, as Connolly was falling thousands of dollars behind in his restitution, documents show he was borrowing $650,000 to plow into his real estate ventures. In this morning's violation of probation hearing, Circuit Judge Debra Behnke will have the final word. She could slap the 44-year-old Valrico businessman's wrist, put him in county jail or send him to state prison for as long as 51/2 years. "I hope they put him in jail forever," said Robert C. Jones, 68, a St. Petersburg widower and retired autoworker. "He's just found a way to rip people off that's ridiculous." Jones is among the scores of local homeowners who have been subjected to Connolly's strategy of using careful research and well-measured intimidation to leverage cheap tax deeds into profitable property sales. Connolly found a peculiar tax deed for half of Jones' property, land that was never conveyed to Jones because of an oversight. After Connolly threatened to put a fence down the middle of Jones' house, the retiree moved out. A title company made Jones' house whole again, but only by paying Connolly $16,500 for a tax deed he had bought for $2,436. Whether Connolly remains free to continue his tax deed flipping depends on how Behnke views the perjury charge lodged Wednesday, and if she determines he has thumbed his nose at the restitution requirements of his probation. The perjury allegation stems from a question on a May 2001 application asking if Connolly had ever had adjudication withheld in a criminal case or was on probation. Connolly answered "no." Connolly had had adjudication withheld on charges of soliciting for prostitution, assault and grand theft. Also, he remains on 15 years' probation arising from a fraud case in which he was accused of cheating the state out of $512,713 in sales taxes. The restitution, ordered in 1997, was set at $124,378 as part of a plea agreement involving sales tax underpayments by Kinjite Motors, a used car company set up by Connolly. Connolly pleaded no contest to grand theft and was ordered to pay the Florida Department of Revenue $750 a month for the last 14 years of a 15-year probationary term. But, according to courthouse documents, Connolly shirked that responsibility in recent months even though he was flush with cash. Since late January, Connolly has taken out six mortgage loans for his tax-deed business, yet didn't tell his probation officer about the growing debt and the source of his income, records show. "That's news to me," said regional Department of Corrections director Joseph Papy, when told Connolly had signed for $650,000 in loans this year. "He never indicated any of that" on monthly probation reports, Papy said. Papy said the loans, and that Connolly spent a small fortune on tax deeds while ignoring his restitution schedule, are evidence that he "willfully and intentionally" violated the terms of his probation. Papy called the perjury charge "the smoking gun" in Connolly's case. Since Connolly emerged from his second personal bankruptcy, and began buying tax deeds, he has missed most of his monthly restitution payments. He made no payments in 10 of the last 17 months, yet bought at least 111 tax deeds in that period. In April, Connolly paid $148,300 for 16 Pinellas County tax deeds. It was in Pinellas that Connolly made the tax-deed buy that bought him into the limelight. He plunked down $1,000 for a 4-acre lake in the Tarpon Woods development in northern Pinellas, erected a fence around part of the shoreline, painted a section pink and demanded the 15 lakefront homeowners buy the submerged land from him for $30,000 apiece. Papy said federal bankruptcy officials have contacted the probation office as part of an investigation to determine if Connolly violated bankruptcy laws. Papy said probation officials have asked for copies of Connolly's tax returns because "we have suspicions he was not correctly representing his income to us." Until last month, Connolly indicated on monthly probation reports that his income was derived from being an auctioneer. But his auction business filed for bankruptcy in May 1998, and Connolly's state auctioneer license expired in November. In May, probation cited Connolly when he fell behind in his restitution by $13,303. Connolly quickly made good on the debt, partly by borrowing from friends, with his tax deeds used to secure some of the loans, records show. The six mortgage loans Connolly got this year came from private individuals. Most of it, $400,000, was loaned by Tampa lawyer Lawrence J. Bailin, who declined to comment to the Times. Another $190,000 came from D.J. Mercer, who loaned Connolly $190,000 for the $200,000 purchase of a home and acreage in Seffner. Mercer could not be reached for comment. Two loans totaling $60,000 were made to Connolly by Arthur Delaski, an engineer who is a close friend of Connolly's and a member of a Bible study group with him. Connolly is paying 18 percent on the loans from Delaski and Bailin, and Delaski said he considered his loans "an investment better than you're going to get in the stock market." Delaski said he trusted Connolly. "Be fair, none of us is perfect, but this guy's got a good heart," Delaski said. "When you pray with this guy, you know he'll be there if you're in trouble." -- Jeff Testerman can be reached at (813) 226-3422 or testerman@sptimes.com.
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