Valley of Lakes Racketeering Class Action against PNC Bank, N.A., et al.

(D) BUILDING FEES SCHEME

136. As a further part of the land development scheme, Commencing on or about September 30, 1986, and continuing to the present, the Defendants, FRANK M. CEDRONE, C.B.G. LIMITED, FIRST EASTERN BANK, and other defendants did knowingly and willfully devise a scheme and artifice to defraud lot owners and prospective lot owners in the subdivision, who wished to construct a house, by EXTORTING A BUILDING FEE OF APPROXIMATELY 8% OF THE TOTAL CONSTRUCTION COSTS. Defendants executed this extortion by maintaining a list of "Approved Builders", a/k/a "Preferred Builders", and denying entry to all other builders. Based on defendant's fraudulent covenants and restrictions, defendants established an "Architectural Control Committee", distributed a "Building Code", and established rules and regulations for the express purpose of carrying out this extortion. And in furtherance of this scheme defendants made numerous false and fraudulent pretenses, representations and promises.

137. In its "Building Code", at EXHIBIT 11-2, CBG expressly mandated that "No construction, digging, clearing or any activity, whatsoever, can be started on properties located within Valley of Lakes development,unless a Building Permit has previously been secured from the Developer."

138. A copy of a letter, dated November 27, 1989, from William A. Del Gesso, Triad Property Development, Inc., 266 Keswick, Glenside, PA 19038, addressed to Mr. & Mrs. Raymond Dongelewicz, 19336 Dunbridge Way, Gaithersburg, MD 20879, is annexed hereto and made a part of this complaint, and marked Exhibit 72.

139. A copy of a check No. 101, dated December 10, 1989, from Leon R. Dongelewicz, 19336 Dunbridge Way, Gaithersburg, MD 20879, paid to the order of "TRIAD PROPERTIES/CBG. LTD," for the amount of $16,456.00, drawn on the Chevy Chase, Federal Savings Bank, Chevy Chase, MD 20815, is annexed hereto and made a part of this complaint, and marked Exhibit 73.

140. A copy of a Contract dated November 17, 1989, between TRIAD PROPERTY DEVELOPMENT, INC., of 266 Keswick, Glenside, PA 19038, and Raymond and Margaret Jane Dongelewicz, of 19336 Dunbridge Way, Gaithersburg, MD 20879, is annexed hereto and made a part of this complaint, and marked Exhibit 74-1 to 74-7.

141. A copy of a Deed between Joseph Oertel and Martha Oertel, His wife, Grantors, of 11 Mary Ann Drive, Franklin, Mass. 02031, and Leon R. Dongelewicz and Margaret J. Dongelewicz, Grantees, for Lot No. D70, of "Valley of Lakes Development," recorded in the Office for the Recording of Deeds, County of Luzerne, Pennsylvania, in Deed Book 2330, Page 968 to Page 971, on or about November 8, 1989, is annexed hereto and made a part of this complaint, and marked Exhibit 75-1 to 75-4.

142. A copy of a letter, dated September 27, 1989, from David J. Bacher, Sales manager, on "Valley of Lakes and Eagle Rock Resort" letterhead, addressed to Leon and Margaret Dongelewicz, 19336 Dunbridge Way, Gaithersburg, MD 20879, is annexed hereto and made a part of this complaint, and marked Exhibit 76.

143. A copy of a Complaint filed with the Office of Attorney General, Commonwealth of Pennsylvania, against Valley of Lakes, and Eagle Rock Resort, dated 5/21/90, filed by Alvin & Mildred Johnston (age over 60), of 7 Cross Bow Court, Commack, New York 11725, owner of real property, Lot #J66, located in the area known as "Valley of Lakes," purchased on or about 1989, and financed by First Eastern Bank, is annexed hereto and made a part of this complaint, and marked Exhibit 77-1 to 77-2.

144. A copy of a letter, dated May 18, 1990, from Alvin Johnston, of 7 Cross Bow Court, Commack, New York 11725, addressed to Bureau of Consumer Protection, Attorney General, 358 State Office Building, 100 Lackawanna Avenue, Scranton, PA 18503 is annexed hereto and made a part of this complaint, and marked Exhibit 78-1 to 78-3.

145. A copy of a letter, dated May 11, 1990, from Frank M. Cedrone, General Partner, on "Valley of Lakes and Eagle Rock Resort" letterhead, addressed to Mr. Dino A. Ciccozzi, President, Ciccozzi Construction Company, Inc., 409 Rear East Broad Street, Tamaqua, PA 18252 is annexed hereto and made a part of this complaint, and marked Exhibit 79-1 to 79-9.

146. A copy of a letter, dated April 6, 1993, from Frank M. Cedrone, General Partner, on "Valley of Lakes and Eagle Rock Resort" letterhead, addressed to Mr. James M. Sysko, Agent supervisor, Office of Attorney General, Bureau of Consumer Protection, Commonwealth of Pennsylvania, Scranton Regional Office, 214 Samters Building, 101 Penn Avenue, Scranton, PA 18503-2025 is annexed hereto and made a part of this complaint, and marked Exhibit 80-1 to 80-4.

147. A copy of a letter, dated April 21, 1993, from George Morris, addressed to Mr. James M. Sysko, Office of Attorney General, Bureau of Consumer Protection, Commonwealth of Pennsylvania, Scranton Regional Office, 214 Samters Building, 101 Penn Avenue, Scranton, PA 18503-2025 is annexed hereto and made a part of this complaint, and marked Exhibit 81-1 to 81-4.

148. CBG's list of "Approved Builders" includes the following: a. Butler Valley Builders, R.D. #3 Box 122, Drums, PA; b. Ciccozzi Custom Homes, 409 E. Broad St., Tamaqua, PA; c. Bud Crawford Gen. Contractor, box 39, St. Johns, PA. d. Eagles Nest Homes, P.O. box 346, Mifflinville, PA; e. Sweetwater Construction Company, R.D. #1 box 89, Weatherly, PA; f. Pedriani Custom Built Homes, Inc. RD #2 Mary Miller Estates, Tamaqua, PA; g. Lincoln Logs Ltd, R.D. #1, Stillwater, PA; h. Triad Property Development, Inc. 266 Keswick Ave., Glenside, PA.

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