Attorneys for convicted Asheville Airbnb business owner Shawn Johnson: $0 losses due to fraud

Joel Burgess, Asheville Citizen Times
·4 min read
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Shawn Johnson speaks at an event in Asheville in this file photo.
Shawn Johnson speaks at an event in Asheville in this file photo.

ASHEVILLE - An attorney for a local Airbnb business owner guilty of $3.5 million in federal loan fraud is saying no banks or other lending institutions suffered losses due to the crimes he committed.

The assertion on behalf of defendant Shawn Thomas Johnson was made in a Sept. 8 filing in U.S. District Court in Asheville by attorney Noell Tin.

Tin, of Charlotte, was responding to a July 19 motion by federal prosecutors to be allowed to seek a money judgment of up to $3.5 million against Johnson. That was after he pleaded guilty to obtaining loans meant for primary homes and a military veteran and instead using them for short-term vacation rentals, often called "Airbnbs" after the online platform.

"The parties agree that he and co-conspirators obtained at least sixteen loans from financial institutions, totaling over ($)3.5 million, which were obtained in conjunction with real estate purchases," Tin said.

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"At the same time, however, neither the factual basis document nor the (Pre-Sentencing Report) identify pecuniary loss to any lender. The defense is unaware of any such loss for the reason that the loans at issue in this case were refinanced after they were obtained. Insofar as the defense is aware, the amount of actual loss in this case is zero."

Johnson gained near-celebrity status as a kind, hard-working handyman and local entrepreneur. But many in property deals with him said they were bilked and in 2019 he had his real estate license revoked.

On March 25 he entered the guilty plea to loan fraud. In separate case, he is facing state charges of assaulting a man with a machete, following a May 28 encounter in Starnes Cove, west of Asheville. Johnson had an administrative appearance for that Class A1 misdemeanor Sept. 8. The online court calendar did not list his next court date.

After the assault charge a U.S. probation officer recommended no changes to Johnson's pretrail release, which includes a $25,000 unsecured bond.

Along with any monetary penalty for the fraud is the potential for up to 30 years in prison. Johnson, though, has told the Citizen Times his plea deal is for up to six years.

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Federal prosecutors who do not normally comment on ongoing cases, have declined to discuss details of the  plea deal. A Sept. 9 message to Assistant U.S. Attorney Benjamin Bain-Creed seeking comment about Tin's assertions received an automatic out-of-office response. Lia Bantavani, spokesperson for the U.S. Attorney’s Office Western District of North Carolina did not immediately answer an email.

In the July 19 motion, federal prosecutors said the $3.5 million was a conservative calculation of the fraud which amounted to "precisely the type of case in which punishment in the form of a financial penalty is imperative."

The properties purchased with the loans were "essentially out of reach" because of additional loans, refinancing, foreclosures, bankruptcies and straw owners created by Johnson or recruited by him, the U.S. attorneys said. Johnson rejected a settlement for an alternative financial penalty or one using other properties, they said.

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In the Sept. 8 filing, Tin asked the court to wait until sentencing to decide on the prosecutors' $3.5 million request. He again noted the loans had been repaid through refinancing and denied Johnson had placed the properties "out of reach." Tin called the penalty "grossly disproportionate to the offense to which Mr. Johnson pleaded guilty," saying it violated a constitutional protection against excessive fines.

U.S. District Court Chief Judge Martin Reidinger had not yet set a sentencing date.

The fraud will be Johnson's second federal conviction. In 2010 he was found guilty of counterfeiting. He was incarcerated until May 3, 2011, according to the Federal Bureau of Prisons website.

More local fraud cases:

Johnson Response to Money Judgment by Joel Burgess on Scribd

Joel Burgess has lived in WNC for more than 20 years, covering politics, government and other news. He's written award-winning stories on topics ranging from gerrymandering to police use of force. Got a tip? Contact Burgess at jburgess@citizentimes.com, 828-713-1095 or on Twitter @AVLreporter. Please help support this type of journalism with a subscription to the Citizen Times. 

This article originally appeared on Asheville Citizen Times: Convicted Asheville Airbnb business owner: $0 losses due to fraud