Nevada agency says real estate appraiser manipulated information to boost values

Grace Leong

Tuesday, Oct. 31, 2000 | 10:52 a.m.

The Nevada Commission of Appraisers of Real Estate has revoked the licenses of two Las Vegas appraisers whom the board accused of "grossly overstating" appraisal values.

The commission revoked Eric Ellis' appraiser's license on Oct. 24 and imposed a fine of $107,000 and $4,000 in legal costs after a hearing on Oct. 23 on the Nevada Real Estate Division's complaint against Ellis. This complaint, filed Sep. 19, accused Ellis of 107 violations of appraisal license law including manipulating data about properties to justify his higher, inflated property values.

The commission said it was "highly concerned" because overstating real estate values could pose "serious problems for lending institutions (that) lend over market value and to the buying public who could be misled into purchasing homes over market value."

The commission, which said Ellis failed to file an answer to the complaint and to appear at the hearing, said he was also charged with "professional incompetence and unprofessional conduct," failing to maintain proper records, failing to complete assignments and failing to employ "recognized methods and techniques to produce a credible appraisal."

"The big concern now is that Ellis could still be operating out there. People could use him if he was representing himself as a licensed appraiser," said Amanda Getzoff, the real estate division's spokeswoman.

The real estate division, which said numerous complaints were filed by Ellis' customers including residential property owners and mortgage bankers, said one customer, Executive Mortgage Bankers, alleged Ellis appraised a property at $195,000 when it was actually worth $135,000.

"Figures were changed in the cost approach, such as calculating the square footage at $65 per square foot for the higher value ($195,000) and $45 per square foot for the lower value ($135,000)," the complaint said.

Other allegations include:

Separately, the commission revoked the license of another appraiser, John Pierson, after he failed to appear at a hearing on charges he "grossly overvalued" several properties.

Ellis and Pierson could not be reached for comment.