Technically, Sinclair does not own the house, which is carried on Santa Fe County tax rolls at a shade over $380,000. Rather, it belongs to one of the numerous corporations Sinclair's attorneys have formed over the years. Such arrangements are small nuisances Sinclair must bear in exchange for conning the government--and ultimately the country's taxpayers--out of an estimated $10 million.
The money is Sinclair's plunder from his starring role in one of the most notorious savings and loan ripoffs in Texas history.
The Interstate 30 condominium scheme was a frenzy of speculative condominium development that erupted in 1982 on the highway corridor east of Dallas. Runaway S&Ls lent millions of dollars based on vastly inflated land appraisals. Hungry investors lied about their finances to qualify for the free-flowing money.
The market could not bear the glut of condos, and collapsed before many of them were even built. At least $135 million in federally insured deposits at five savings & loan institutions in Texas and Arkansas was wiped out. More than 100 people were prosecuted for their parts in the debacle, which caused the failure of Empire Savings & Loan of Mesquite and was a precursor of the nationwide thrift meltdown that soon ensued.
Only now, more than a decade after the fact, are the final moments of the case at hand. The most notorious players on I-30, the supposed masterminds whose lawyers have long forestalled a final reckoning, are soon due in prison.
Garland developer Danny Faulkner, the illiterate house painter who rose to incredible wealth on I-30, lost his final appeal to the U.S. Supreme Court last month. A federal judge has told him to show up in court January 3 so he can be dispatched to begin his 20-year sentence.
The final appeals of former Garland Mayor James Toler and Mesquite banker Spencer Blain, who headed Empire Savings & Loan during its plunge into receivership, are expected to be resolved soon. No one believes they will be any more successful than Faulkner at avoiding prison.
Exacting retribution has been a lengthy and expensive struggle for federal prosecutors. It took two trials, the first lasting seven months and ending with a hung jury, before Faulkner, Toler, Blain, and other I-30 kingpins were ultimately convicted in 1991.
Most of all, it took the testimony of Clifford Sinclair--who became the government's key witness against his former business cohorts.
Which explains why the admitted swindler and his wife live comfortably today in New Mexico, with a fortune tucked away in offshore trust accounts.
Later trial testimony would show that Sinclair had as much, or more, to do with the I-30 looting spree than many of the better-known names that emerged from the case.
By rights, and by law, Sinclair should have been forced to pay back the money when he pleaded guilty to his part in the scheme. But Sinclair, a lifelong hustler, pleaded to four counts of conspiracy, fraud, and falsifying financial statements in 1986, before the full scope of his culpability was known. He then offered his help to convict others.
Becoming a snitch proved lucrative. Sinclair's cooperation with prosecutors cut his possible prison time from more than 100 years down to 13, of which he actually served less than five at the relatively posh federal pen in Fort Worth.
And while he was acting as the prosecution's key witness, assigning most of the blame for I-30 to others, Sinclair managed to spirit away about $10 million of the loot.
Some of the money went to his wife, Kitty, later trial testimony would show. Even more went into trust accounts in the British Virgin Islands, according to Sinclair's own financial records.
At one point, Sinclair adopted his 38-year-old chauffeur and made his newfound son a beneficiary of the Virgin Island trusts, creating another conduit through which Sinclair could gain access to the money.
As part of his plea agreement, Sinclair did return $600,000 of the money he made from I-30. But during just one of the years he was in prison, Sinclair made more than $700,000 in interest on the money he had squirreled away, according to copies of tax returns that Sinclair was forced to turn over to defense attorneys. And federal prosecutors, who needed Sinclair's testimony to bag Faulkner, did nothing to stop the financial machinations of their star witness.