A city-run homeless shelter is among the buildings federal agents are trying to seize in what one expert said could be the largest such property grab in Maine’s history.
Four buildings the city rents to use as a shelter complex for homeless families are among 30 properties that the federal government is seeking to seize from a Portland man, using a controversial method that allows law enforcement agencies to take property that they believe to be linked to crime.
In a series of raids across Portland this spring, the FBI seized nearly $849,000 in money and watches from four Portlanders, although none of them appear to have been charged with a crime. The federal government has also initiated a legal proceeding, known as civil forfeiture, against 30 Portland-area properties owned by one of those four people, local landlord Stephen Mardigan.
If the properties, which include waterfront homes valued at more than $1 million, are seized, it will be an unusually large and possibly record setting seizure in the state of Maine, according to the Institute for Justice, a public interest law firm that tracks civil forfeiture. But such proceedings are generally slow moving and are unlikely to directly affect the city or others who lease the properties, said lawyer Thomas Marjerison, who does not represent any parties in the case.
“The federal government can’t, basically, extinguish the rights of the any third parties,” said Marjerison, a partner with the Norman, Hanson, and DeTroy law firm. “If these properties are allegedly the fruits of criminal activity that doesn’t mean the tenants get tossed out on the street.”
A notice that the federal government has begun a civil forfeiture suit against Mardigan’s properties was posted in the Cumberland County Registry of Deeds in April, although the federal court case is sealed and its status is unclear. The April property seizures are linked to alleged violations of federal gambling law, according to an FBI notice.
No criminal cases or indictments against Mardigan or any of the other three individuals — Mardigan’s girlfriend Patricia Nixon, and local men Steven DePaolo and William Flynn — targeted in the April raids could be found in the U.S. District Court in Portland or in the Cumberland County Superior Court. None of the four could be reached for comment.
Civil forfeiture suits are generally efforts on the part of the federal government to prevent people from selling their real estate holdings or other property, according to Marjerison. Mardigan holdings include four buildings on Chestnut Street that the city uses collectively as a shelter for homeless families.
The seizures and suit against Mardigan’s properties were first reported by The Bollard, a monthly magazine based in Portland.
The buildings at the corner of Chestnut and Oxford streets are split into apartments and together serve as a 96-bed family shelter, according to city documents. The city has leases for them, with Mardigan and the estate of his father Edward Mardigan, through June 30, 2018.
Portland police assisted with the investigation that led to the April FBI raids, but the city has not received any funds from the seizures, according to city spokeswoman Jessica Grondin.
The city did not receive “official notice” that properties it rents are involved in a civil forfeiture proceeding, but is closely following the situation, Grondin said.
A lawyer who represents Mardigan in real estate matters did not respond to a request for comment Tuesday, nor to earlier requests.
The FBI and U.S. Attorney’s office previously declined to comment. The FBI cited an ongoing investigation.