Four years ago, in the fall of 2007, developer Jeanne Rizzotto approached Clarence and Barbara Werbelow and their son and daughter-in-law, Steve and Kathy Werbelow, with an investment opportunity: they could each put $100,000 into her planned …
Former Montana realtor never paid back investments
A former Red Lodge, Mont., developer has been ordered to pay more than $368,000 to two Powell couples who, according to court findings, were defrauded by her.
Four years ago, in the fall of 2007, developer Jeanne Rizzotto approached Clarence and Barbara Werbelow and their son and daughter-in-law, Steve and Kathy Werbelow, with an investment opportunity: they could each put $100,000 into her planned nine-hole golf course and RV resort outside Red Lodge and get $150,000 back in a year.
A family member’s girlfriend had been working with Rizzotto in her Red Lodge real estate office and arranged the meeting between the realtor and the Werbelows.
“It sounded like a pretty good deal and we trusted her (Rizzotto),” recalled Clarence Werbelow in Park County’s District Court last month.
Clarence Werbelow and his wife used their savings to invest the $100,000. Steve and Kathy Werbelow took out a second mortgage on their house to come up with the money, because “we were hoping to turn it over in a year, as Jeanne (Rizzotto) had promised ... and we could get the house paid off,” recalled Kathy Werbelow.
The development never came to fruition, and Rizzotto never paid back any of the Werbelows’ money. The two couples filed suit in December 2008. In June 2009, Rizzotto filed for bankruptcy.
The Werbelows had reached a settlement agreement in which each couple would get $130,000 when the bankruptcy case was completed.
But the bankruptcy case was dismissed a year ago when a pending sale of the property fell through and Rizzotto left the area and dropped contact with her attorney, court records and Billings Gazette accounts say. Banks took over Rizzotto’s properties, but the Werbelows and other creditors got nothing.
“She ripped us off,” said Steve Werbelow.
“It’s hard to take when you lose money like that,” said Clarence Werbelow, 75, adding that he and his wife Barbara, 74, will need the money down the road for medical expenses.
The Werbelows made the comments at a court hearing last month in Cody, where District Court Judge Steven Cranfill issued an order of default against Rizzotto in a suit filed by the two couples.
After an initial defense, Rizzotto stopped communicating with her attorney in the case, and her current location is unknown. She didn’t appear in Park County’s District Court on Oct. 11 to offer a defense, and court documents sent to her last-known addresses came back unopened.
“Obviously she doesn’t take responsibility for her promises,” said Joey Darrah, the Werbelows’ Powell attorney, at the hearing. “She obviously has ignored the fact that she has a pretty serious lawsuit against her.”
Judge Cranfill ordered Rizzotto to pay back the $200,000 the Werbelows invested with her, plus the $100,000 she’d promised in returns as punitive damages, $68,000 in interest and more than $6,300 in attorneys fees.
“I wish we had a fund we could just dip into and write you a check this morning,” Cranfill told the Werbelows, calling the situation “heartbreaking.” He awarded everything the couples had asked for.
An order written by Darrah and signed by Cranfill on Oct. 12 says Rizzotto deceived and induced the Werbelows “into investing considerable money that they could not afford to invest.”
Kathy Werbelow said she has heard others were taken in by Rizzotto. The FBI also contacted the family, seeking information as part of an investigation into Rizzotto’s activities, but apparently nothing ever came of it, Kathy Werbelow said.
“This hasn’t been a fun thing for us, and I think a lot of people would have just dropped it or moved on, but we just financially can’t,” she told Cranfill, adding, “We ... may not get any return on this at all, but we have to try, because it’s not fair.”
Rizzotto drew national media attention in recent years for being the owner of two chimpanzees that she dressed and fed like children. She drew local media attention for criminal charges — a misdemeanor relating to an incident in which the chimps escaped their enclosure and attacked a woman and a felony charge for writing a $155,000 bad check.
Rizzotto gave the 8-year-old chimps to a sanctuary in Florida last year.