ELLSWORTH, Maine — A horse farm has a new owner, and three people who were owed money by accused Ponzi schemer Eric S. Murphy Jr. are expected to get some or all of their money back.
The roughly 130-acre property on U.S. Route 1 was auctioned off Friday morning to Sophia Pod, a businesswoman who travels extensively and spends time in the Mount Desert Island area. Pod came up with the high bid of $401,000 for the farm, which includes a 32-stall horse barn that was built in 2007.
About 35 people attended the 10 a.m. auction at the farm, five of whom bid on the property.
Elizabeth Belch, who with her husband, Anthony Belch, owns the construction company that built the barn, said Pod acquired the property and the empty buildings on it for less than what it cost to construct the barn. Belch said that she and her husband won’t get back all the money Murphy owes them, but that they’d rather get some of it back and be done with it than buy the property outright themselves, make payments on it and then try to re-sell it.
“It’s better than buying it today,” Belch said of the sale. “[Pod] got a good deal. It would have to go for $900,000 for everyone to get paid.”
Cindy Hagerthy, who sold the property to Murphy in early 2007, and the Belches are expected to recoup money out of the foreclosure auction. Hagerthy, who inherited the property from her mother and who held the mortgage on the farm, said she will get the $280,000 that Murphy owed her for buying the property. The Belches will get about $120,000 of the $170,000 they are owed by Murphy.
According to Hagerthy’s attorney, James P. Modisette of Blue Hill, others who claim they are owed money by Murphy are not expected to benefit from the foreclosure sale.
“I would have liked more people to get paid,” Elizabeth Belch said.
Hagerthy, who lives in Farmingdale, said the sale of the property will help bring her peace of mind. She said she agreed to hold the mortgage on the property, even though banks would not finance the deal, because Murphy himself was in the home loan business.
“I thought he was trustworthy,” Hagerthy said. “I’ve been losing sleep over it for two years. It’s been very stressful.”
Pod, interviewed briefly after the auction, said she has four children and plans to use the property to board horses. She said she may try to run an equine-assisted therapy program for children at the property.
“We love horses. They’re very healing,” Pod said. “They’re magnificent creatures.”
The auction did not involve any horses, furnishings or equipment. The barn and a home on the property have been vacant for at least several months.
Murphy, 48, is accused of stealing more than half a million dollars from investors in his now-defunct company, Murphy Home Loans. Prosecutors have said that, in a manner similar to a Ponzi scheme, Murphy spent investors’ money on himself and his business rather than on funding specific mortgage loans.
In March, Murphy pleaded guilty to two felony theft charges in a deal with prosecutors that would have put him behind bars for 18 months and required him to pay $570,000 in restitution, but the agreement was rejected by Hancock County Superior Court Justice Kevin Cuddy.
With the rejection of the agreement, the case is expected to go to trial later this summer.