« PreviousContinue »
Mr. FOGARTY. Yes.
Mr. FOGARTY. That is a water storage area for the Everglades National Park. They hold water back and when the park becomes dry they gradually release it into the park to sustain all of the wildlife.
Senator WILLIAMS. But Golden Palm Acres as a company owns the land, yet it has this easement for use as flood control project?
Mr. FOGARTY. Yes, the easement was granted in 1950 to flood the thing.
Senator Williams. If anybody buys an acre in Golden Palms, he might be high and dry 1 year and under water the next year?
1 Mr. FOGARTY. That is true. I would say that he would be under water both
years. Senator WILLIAMS. And yet those acres have been sold, I think you said, to over 100 purchasers ?
Mr. FOGARTY. Over 100 purchases and I would say, possibly 640 acres have been sold.
Senator WILLIAMS. The president of the Golden Palm Acres has been invited to come in and talk to us. He is the one I indicated in my opening statement was otherwise occupied. He has a legal problem. He can't find his lawyer. But I told him I would go to him if he can't come to us. He is 15 minutes from our home so I hope he will avail himself.
Senator MONDALE. Mr. Chairman, if you will yield at this point ?
Did the sales promotion for this Golden Plams development disclose that it was a water conservation district or was subject to flooding for water conservation purposes?
Mr. FOGARTY. Sales materials didn't. The deed indicated an easement dated 1950, but it did not spell out what the easement was.
Senator MONDALE. There was sufficient notice for legal purposes but the layman would not know what that meant at all?
Mr. FOGARTY. No.
Senator MONDALE. Did the State of Florida do anything to prevent this?
Mr. FOGARTY. No, they, to my knowledge, haven't done anything, although the Florida Installment Land Sales Board has instituted some sort of proceedings in trying to either slow them down, but they have been slowed down because they haven't filed any new deeds in the last month or two.
Senator WILLIAMS. We have some of the descriptive material here from Golden Palm Acres. I am interested in the letterhead, because it shows a palm tree and suggests the sunshine and the home office is 20 Bradford Place, and in parentheses, “Chamber of Commerce Building, Newark, N.J.” That gives it a dignity, you know. I didn't know that was the Chamber of Commerce Building. I never heard of that before. But at any rate, it also includes these words “And your mineral rights may prove to be worth far more than you can possibly imagine because oil is being actively sought in Dade County." Is that an accurate description of a reasonable hope that there might be oil in Palm Acres ?
(The letter follows:)
DEAR INVESTOR : Our congratulations to you! The interest you have expressed in our truly exceptional Dade County, Florida, acreage offering stamps you as a person who recognizes an exciting investment opportunity * * * and who will ACT to take advantage of it to your benefit.
Millions of dollars have been made by wise and foresighted investors from land investments in the South Florida area in and near Greater Miami. Millions more will be made by those who can visualize the fantastic future of this fastgrowing metropolitan area! Will YOU be one of them? Dade County acreage is being snapped up at an ever-increasing pace *** in the first four months of 1965 the dollar volume of sales totalled almost 300% MORE than in the same period in 1964! Yes, the smart investors * * * those who consistently make money * * * because they anticipate the future * * * have evaluated Dade County acreage and have backed their judgment with ACTION! They know that Florida is the fastest-growing major state in the nation with hundreds of thousands of new residents pouring in each and every year. They know that choice land MUST rise in value because these people cause an insatiable demand for homes, schools, shopping centers, etc. (In some areas of Dade County choice land is now priced as high as $50,000 per acre.) They know that Dade County's population is expected to DOUBLE by 1985 * * * just 20 short years from now.
Golden Palm Acres offers you NOW the tremendous opportunity to be an investor in this phenomenal area at a price you can easily afford. Golden Palm Acres is advantageously located within Dade County (Metropolitan Miami is also in Dade County). We know you will agree with us that undeveloped land in this area represents the chance of a lifetime to participate in the golden future of South Florida. Undeveloped land offers more opportunity for profit because it can be bought at relatively low cost and thus has more leverage * * * opportunity to increase in value percentage-wise to original cost.
Golden Palm Acres gives you 144 acres of land *** not just a lot. And developers in South Florida usually allow 4 spacious lots per 144 acre. You receive free warranty deed which is title insurable plus a full 50% of all oil, gas and mineral rights. The land is sold exclusively by the owner and developer. And * * *
your mineral rights may prove to be worth far more than you can possibly imagine * * * because oil is being actively sought in Dade County! In adjoining Collier County and in Lee County just North of Collier, Sun Oil Company has producing and profitable oil wells, in operation NOW. Oil prospectors have lands under lease within 10 miles of Golden Palm Acres. "Florida offers one of the last frontiers for finding oil in large quantities,” states one authoritative oilman who is investing $1,000,000 to find oil in Dade County. Owning oil-producing land can provide financial security for a lifetime for you
your children * * * and possibly even your grandchildren. At Golden Palm Acres, therefore, you have breath-taking double potential ! Land in fast-growing South Florida *** plus oil, gas and mineral rights that are potentially invaluable!!!
Now is the time to act! Take advantage of this fabulous opportunity by filling out and mailing the enclosed Order Envelope together with your check. We have but a limited number of tracts available and first come, first served. So, don't delay. Reserve your share of South Florida's fabulous future by mailing your order today! Yours for profits in Florida,
GOLDEN PALM ACRES, INC. Mr. FOGARTY. I think in the article I published on this, they had put down an exploratory well and capped it at 11,000 feet because it brought salt water and there has been some talk of another exploratory
* * *
well, but nobody seems to want to risk $400,000 in another salt water well.
Senator WILLIAMS. As a matter of fact, didn't the explorers go bust?
Mr. FOGARTY. Yes
Senator WILLIAMS. Now that, you see, anyone not sophisticated could be taken in by the statement that oil is being actively sought in Dade County. They could be taken by it, not whether oil has come in, but it is being actively sought.
Senator MONDALE. What bothers me, Mr. Chairman, with this particular example, is that even under our proposed measures, as I understand it, the prospectus can provide that this area is subject to, and to use legal terms, is a water conservative district and be included in regular form and all, but the most alert purchasers with legal advice might miss it. This is the sort of outrageous and totally indefensible promotion that offends anyone's sensibilities, even if the truth is told. And it seems to me that we need something in here in reserve to permit the SEC to perhaps provide a special notice, a special warning, this land is subject to being flooded in a way that consumer says it.
Senator WILLIAMS. In this material from Golden Palms does it appear anywhere that it is in a flood control district ?
Mr. Oriol. Mr. Fogarty in his article pointed out that the actual deed has very technical language. Perhaps you care to describe it.
. Do you have the article?
Mr. FOGARTY. I don't have the article. I think I explained the easement which just simply states:
Subject to easement of the Central and South Florida flood control district dated January 12, 1950, recorded February 6, 1950, in Deed Book 3236, page 582 in public records of Dade County
And when I first checked
Senator Williams. On that point, the unsophisticated again might think this was a protection to him?
Senator MONDALE. Once more, this appeared in the deed, probably after the sale is consummated ?
I used to do a lot of real estate work when I was in practice. I never saw a purchaser read a deed. That is something you file with the registrar of titles to protect yourself against another purchaser.
Mr. FOGARTY. I was quite shocked when I went back to this book and page number to find the easement, when I first started looking into this company, and I was quite shocked at finding such an easement as that because I didn't realize that there was such a thing.
Mr. Oriol. I just want to make a point that Mr. Fogarty in his article on Golden Palm Acres published the results of several interviews he had with purchasers and he found out almost universally that they had little idea of what was actually bought. Is that right?
Mr. FOGARTY. They had no idea of the easement. Most of them seemed to think it was just like a regular utility easement or something of that sort.
Mr. ORIOL. If I may add to that, as a result of the names Mr. Fogarty gave me, this subcommittee got in touch with a local-is Mr. John Deebo in the audience! I don't see him here, but he is a gasoline station owner in the District of Columbia. He would have been here today if he could have found somebody to run the gas station for him. I suppose we will have a statement from him in writing. His impression was that he was buying farmland, and he thought oil seemed pretty sure to come in almost any time now. So he confirmed what your article said. (A letter from Mr. Deebo follows:)
DEEBO'S Esso SERVICENTER,
Washington, D.O., July 5, 1966. Senator H. WILLIAMS, Senate Office Building, Washington, D.C.
GENTLEMEN : In reply to your inquiry of my land purchase from Golden Palm Acres, Inc., I should like to state some of the selling points that were made. The salesman mentioned the possibility of future oil drilling by major oil companies. It was also said that this was farm land and no reference was made to the fact that this was located in a water conservation area.
I shall be very happy to give you any other information that may be of any importance. Very truly yours,
JOHN DEEBO. Mr. FOGARTY. The conservation district says as far as they are concerned, there will never be any oil drilling in this area, which incidentally is 914 square miles, and they say that any spillage of any drilling, successful drilling, would kill all wildlife in the Everglades Park. Well, it wouldn't all at once, but the oil filtering through the park would
Mr. Oriol. The flood control district takes a pretty dim view of oil explorations?
Mr. FOGARTY. They take a dim view of even anybody attempting to go live there, because in the first place there is no way to get rid of the sewage or drill for water, all of those things.
Senator WILLIAMS. And this area, if you could build, and if you didn't build on stilts, you would be in trouble?
Mr. FOGARTY. They would require, if anybody did build, it would have to be on stilts.
Senator MONDALE. Were any of these lots sold to purchasers in the immediate vicinity of Golden Palms or whatever it is?
Mr. FOGARTY. There were no Florida sales.
Senator MONDALE. Would that be because Floridians knew it was worthless ?
Mr. FOGARTY. I would think that might be the case. I don't know whether they would be subject to any laws in the State if they were selling in the State.
Senator MONDALE. Do you happen to know whether, of any of these sold, the sales were made after the prospective purchaser had viewed the premises, or were they all sold site unseen?
Mr. FOGARTY. I never talked to anybody that had seen it. The president of the Golden Palms said a man did go out and look at it
Senator MONDALE. One man that he knew of?
Mr. FOGARTY. He cited one person from North Carolina who drove his Cadillac out on the flood control dike and he told me that he broke his muffler and broke the oil pan on his car, and everything, and said he had an awful time.
Senator MONDALE. Did he buy a lot?
Mr. FOGARTY. He said he did. It was interesting to note I never found any
North Carolina sales in the deed books. Senator WILLIAMS. I see. You were told by Golden Palms that this happened?
Mr. FOGARTY. Yes, sir.
Mr. FOGARTY. This man from North Carolina apparently didn't buy. If he did go out there, I don't knowSenator WILLIAMS. He said he bought, the Golden Palm guy
said he bought, but you could never find recorded deed?
Mr. FOGARTY. No.
Mr. FOGARTY. You would almost have to go out by airboat and helicopter to view this property, to see this property.
Senator WILLIAMS. Well, do you have anything else?
Senator WILLIAMS. This has been more than illuminating. It seems to establish a record that should be highly persuasive to this committee that something should be done. Obviously the interstate factor gives us jurisdiction at the Federal level and it is a matter of fact State law alone can't do it, although the bill does provide where State law is adequate, that the Commission can accept the information which the State law does require.
I don't have anything further except to thank you gentlemen for all of your help.
Mr. PAULSON. Thank you.
Mr. ORIOL. Before you leave, we are rather pressed for time. Our next two witnesses have time problems, so I just want to indicate that some questions in writing will be coming to you very shortly, but I did want to ask Mr. Paulson, you have statements from Mr. Doyle and Mr. Greenwood with you?
Mr. Paulson. I didn't bring them. They said they would mail them.
Mr. ORIOL. That would be for the record. (Statements appear on pp. 409 and 412.)
I also wanted to ask if we could have for the record several articles including one describing your experiences with telephone call sales techniques.
(Article appears on p. 311.)
Mr. Paulson. You certainly may. I don't have a copy of that with me, but I will mail it as soon as I get back home.
Mr. ORIOL. Mr. Fogarty, you are submitting a series of articles prepared by Juanita Greene? (Articles appear on p. 466.)
Mr. FOGARTY. Yes.
Mr. ORIOL. One of the questions we will be asking you is about the leverage concept which she described. Also several of the questions raised about the possibilities of building entire cities in this remote
Do you have a statement from Miss Juanita Greene?