By PAULA TRACY, InDepthNH.org
LACONIA – Robynne Alexander, 63, of Manchester, who was initially chosen by the state as the top bidder to buy the former Laconia State School property for $21.5 million but had inadequate funds to close the sale, pleaded guilty Wednesday to operating a fraudulent real estate investment scheme.
Acting U.S. Attorney Jay McCormack announced the plea in a news release. The Federal Bureau of Investigation led the investigation and U.S. District Court Judge Samantha D. Elliott scheduled Alexander’s sentencing for Oct. 15.
The Securities and Exchange Commission and the New Hampshire Bureau of Securities Regulation provided assistance. Assistant U.S. Attorney John J. Kennedy is prosecuting the case, according to the release.
According to the charging documents and court statements, beginning in 2018, Alexander, previously a real estate investment coach, began raising funds from her coaching clients for a New England real estate venture, Raxx-LeMay, LLC.
“Despite promising to acquire and renovate two commercial properties in Manchester she only raised $700,000 of the $2 million minimum required by the May 2018 deadline. Among the terms of her agreement with investors, if the minimum dollar amount was not raised by that date, investors were to get their money back with interest. Despite not having raised the required minimum dollar amount, the defendant did not return investor money with interest, but instead proceeded to use investor money for purposes that were not permitted under the offering terms. Nevertheless, she completed the purchase in July 2018 using expensive hard-money loans and improperly diverted investor funds to other entities she controlled, to repay outside investors, and to fund additional projects,” the U.S. Attorney’s release said.
“Over the next few years, the defendant used investor capital across multiple projects without proper authority or disclosure. For example, she transferred the Raxx-LeMay properties to a new entity she controlled in early 2022, despite lacking investor approval, leaving Raxx-LeMay with no assets and investors with total losses of about $850,000. In a separate project, Elm and Baker, LLC, Alexander solicited $750,000 to convert a Manchester property to apartments but diverted more than half of the funds to repay unrelated investors and personal loans, culminating in foreclosure on that property in 2023.
“Similarly, in late 2022, she solicited funds for a large-scale resort project in Laconia receiving $250,000 from investors toward the purchase before misappropriating at least $75,000 and ultimately failing to close on the property, causing the project to dissolve. Across at least eight ventures, the defendant defrauded at least 24 investors of roughly $3,023,000,” according to the release.
The charging statute provides for a sentence of up to 20 years of imprisonment. It also provides for a supervised release term of up to 3 years, and a maximum fine of $250,000 or twice the pecuniary gain, whichever is greater.
New Former Laconia State School Deal
After the Laconia deal with Alexander fell through after numerous extensions, the New Hampshire Executive Council put the state-owned parcel back on the market and voted to select Pillsbury Realty Development to purchase the property for $10.5 million.
That deal has not yet closed but it is advancing with approvals from the city. In early July a proposed development plan was approved by the Laconia Planning Board.
If the state and Pillsbury close, the 217-acre “Laconia Village” could be developed in phases into more than 2,000 units of housing and be added to the city’s tax rolls.