By John Reinan

Minneapolis Star Tribune

TWO HARBORS — Ray Turcotte once owned a gas station in this scenic town of 3,700 on Lake Superior’s North Shore. His wife, Judy, ran a hair salon. After amassing a net worth approaching $1 million, they retired to the lakeside home Ray Turcotte built with his own hands.

But after placing their financial future in the hands of David Ripley, the Turcottes are broke. Their home, which they owned free and clear, now carries a mortgage they can’t afford, and they could be evicted during the depths of winter.

Ray Turcotte, 86, has been hospitalized since late November after suffering a stroke, which his wife blames on the stress of their financial loss.

“We have nothing, and I mean nothing,” said Judy Turcotte, who, at 74, brings in a few dollars by doing laundry at a bed-and-breakfast. “Ray and I are just two old people who worked our tails off. We had our house paid for. We had stocks. We had investments. And it’s all gone.”

According to court documents and interviews, Ripley ingratiated himself with the elderly and childless couple, persuading them to let him manage their finances. He promised to take care of them, they said. They put so much trust in him, in fact, that they even helped him buy a house next door to their own. He still lives there, despite taking control of their money and cleaning them out, the Turcottes said.

“He said, ‘You’re older, vulnerable adults. You don’t have anybody to help you,’”  Judy Turcotte said.

“He told us he loved us,” she said, sobbing. “He said, ‘You’re more of a mother to me than my own mother was.’ “

The Turcottes aren’t the only ones who have claimed to be victimized by Ripley, 56, who arrived here from North Dakota about 15 years ago. Since then, Ripley has been involved in a dizzying array of investment deals and property transactions that have left a trail of angry investors across three states, according to court records and interviews.

Many of the deals wound up in litigation, and several lawsuits ended with substantial penalties against Ripley, who owes more than $2 million in court judgments and unpaid loans, public records show. Included are two convictions for civil fraud.

In a recent interview at his home, Ripley denied all the Turcottes’ allegations.

“From my perspective, it’s sour grapes,” he said.

Bonnie Piehl, Ripley’s longtime partner in life and in business, also denied that she and Ripley did anything wrong.

“They can’t say we scammed them out of one dime,” Piehl said.

In an interview from his hospital bed, Ray Turcotte still couldn’t quite believe how events unfolded.

“You’re going to wonder how the hell this can happen,” he said.
A long, tangled web

Court and land records, and interviews with Ripley’s investors, tell a complicated story.

For several years, Ripley worked with Gregory Hewitt, a Minneapolis investment manager, according to court records and interviews. In 2008, Hewitt was convicted of federal wire fraud for stealing money from investors and sentenced to nine years in prison. Ripley was not charged in that case. Asked about his relationship with Hewitt, Ripley denied having anything to do with him.

“Hewitt and I were not linked in anything,” Ripley said.

Business contracts, court records and interviews with more than a dozen people who invested with the men document a deep business relationship between the two. Ripley hired Hewitt in 2001 to “relaunch” his company and find investors, according to a contract signed by the two men.

During that same period, Ripley and Hewitt worked together on a separate development deal in North Dakota and engaged in several land transactions with each other, court and land records show.

Ripley also denied knowing anything about a federal court judgment of nearly $1.5 million against him for civil fraud and breach of contract.

David Perkins, who owns a Bloomington beverage-supply business, remembers Ripley well. Court records show that Perkins and his father, Eugene, each bought $50,000 worth of stock in the North Dakota-based business that Ripley and Hewitt were promoting. Their contract gave them the right to ask Ripley for their investment back, which they did.

“He kept leading me on,” David Perkins said. “He’d return my phone calls, but I think he was buying time, figuring out how he was going to get out of this. And finally we realized, he’s not going to do it.”

The Perkinses sued Ripley and won a judgment for fraud and breach of contract in 2005. They were awarded the value of their investments, plus penalties and interest, according to court records — a total of nearly $1.5 million. But more than a decade later, Ripley hasn’t paid a penny, David Perkins said — not to him nor to his 96-year-old father.

Son they never had

During the time that he was engaged in these other deals, Ripley met the Turcottes, and their relationship grew.

Ripley and Hewitt came to Two Harbors in 2001 to find investors for Ripley’s company, NDC Holdings Inc., according to court records. Ray Turcotte invested $30,000. Soon, according to interviews and depositions, he and his wife were referring to Ripley as their “son” and he was calling them “mother” and “father.”

It wasn’t long before Ripley had his eye on the house next door to the Turcotte place, on a lake 20 miles north of town. Judith Chandler, who owned the property, said Ripley initiated conversations about buying it. When she decided to put it on the market in 2004, “he jumped at it,” she said.

And the Turcottes helped. They took out a $165,000 mortgage on their own house, which was fully paid off, and transferred the money to a trust controlled by Piehl, according to land records, police files and court documents. The trust used that money to buy the house for Ripley and Piehl, who live there today.

About two years later, while setting up another financial deal involving the Turcottes, Ripley wrote e-mails to a bank official in which he referred repeatedly to the couple as his “parents,” according to copies of the e-mails provided by the Turcottes. He even gave Judy Turcotte a Mother’s Day gift, police records show — a necklace that said “Mom.”

The Turcottes opened an account at Charles Schwab and gave Ripley the authority to make trades. At one point, according to Ray Turcotte’s deposition, the account held hundreds of thousands of dollars. The Turcottes never saw that money again, they said in an interview. They also refinanced their home, land records show, boosting their mortgage debt to $252,000.
Ripley gets everything

Two years later, the Turcottes turned over everything they owned to Ripley’s trust.

In March 2008, land records show, the Turcottes filed a gift deed conveying their home to the Ripley Family Trust. On the same day, they gave the trust title to all their personal property, including their car, boat, Bobcat, tools and guns, and the gold watch Ray Turcotte’s mother received for nursing school graduation in 1923. In return, Ray Turcotte said in a deposition, Ripley agreed to take care of them and pay them $1,500 a month for life.

They didn’t get the agreement in writing. “With David, everything was verbal,” Judy Turcotte told police.

Within 18 months, Ripley and Piehl tried to evict the Turcottes from their own home, whose title was now held by the Ripley Family Trust. The Turcottes came home one day in August 2009 to find an eviction notice on their door, as well as a demand that they turn over all personal property, according to copies provided by the Turcottes.

The next day, the Turcottes went to the sheriff, who opened a criminal investigation. But no charges were brought. Judy Turcotte said sheriff’s officials told the couple they decided the matter was a civil case.

Ripley and Piehl dispute the Turcottes’ version of events, saying that the older couple badgered Ripley to live near them. He said he only agreed to move next door after a long illness convinced him that living by the lake would be good for his health.

Ripley said he made payments to the Turcottes for several years and also paid off thousands of dollars’ worth of credit card bills and other debt they’d accrued. But in 2009, around the time of the attempted eviction, Ripley — claiming the Turcottes were taking advantage of him — severed financial ties.
Victims of the heart

In 2011, the Turcottes filed a civil suit against Ripley, Piehl and the Ripley Family Trust for fraud and breach of contract. The case went to trial in 2014. A preliminary verdict form in the court file shows that the jury was split, ruling that the trust didn’t breach its contract with the Turcottes, but that it did “falsely represent a past or present material fact” to them. The two sides decided to settle.

In the settlement, the Turcottes got back title to their house and possessions. They also got the mortgage and its $1,700 monthly payment. In an e-mail, Piehl said she believes that she and Ripley have been completely cleared.

“This dispute has been properly adjudicated,” she wrote. “When the jury’s verdict was rendered I made the decision to end Judy’s torment by offering to return her home and end the conflict once and for all.”

In the two years since the case ended, the Turcottes have scraped together enough money to make their mortgage payments. But with a combined income of $1,600 a month from Social Security, they no longer can keep up. Their home has fallen into disrepair, with water damage from a leaky roof spreading throughout the house.

They’re currently getting assistance from the state Attorney General’s Office, which is mediating with the bank in hopes of working out an “unwinding” of the mortgage, said a spokesman for the attorney general.

Shawn Reed, the Duluth attorney who handled the Turcottes’ lawsuit against Ripley, said the couple followed their hearts — and lost.

“He took advantage of their love,” Reed said of Ripley. “I think Ray and Judy believed they were going to live the rest of their lives on the shore of that lake, together, as a family.”