(WBIR - KNOXVILLE) - The million-dollar West Knox County home of a former investment manager accused of stealing clients' money and lying about it is up for sale.
Jacqueline J. Stanfill's five-bedroom, 7,700-square-foot house at 7010 Stone Mill Drive in the Westmoreland Heights subdivision is being offered at $1.649 million. That's less than its assessed Knox County value of $1.8 million.
The home was advertised online four days ago and can be seen here.
U.S. Bankruptcy Judge Suzanne H. Bauknight last month approved a bid by former clients to force Stanfill into bankruptcy. They allege that Stanfill took their money, assured them she was investing it in legitimate accounts but was actually spending the money for her own personal benefit.
Attorneys say they suspect there are at least 21 victims, including family members, who are missing a total of nearly $7 million that Stanfill claimed to have invested in retirement, college funds, and other accounts.
Clients in court have accused her of living a lavish lifestyle that included furnishing and upgrading the house on Stone Mill Drive and taking extravagant vacations such as one in June 2013 to the south of France.
Stanfill has not been charged with a crime. Several clients are suing her in Knox County Chancery Court, seeking to recover investments.
Stanfill's spouse is Regina Lambert, a Knoxville attorney who represents a same-sex couple challenging Tennessee's refusal to recognize gay unions performed in other states. Lambert has not been charged and is not named as a defendant in the bankruptcy petition.
A creditors' meeting is set for Monday in U.S. Bankruptcy Court in Knoxville.
Stanfill operated Stanfill Wealth Management LLC out of office space off Northshore Drive. In recent years she also had pursued entrepreneurial efforts including a social media meet-up app called Spontivity. A Facebook page now largely dormant describes the project here.
Grey Steed has been appointed by the court to serve as bankruptcy trustee. He is preserving the estate so assets can be sold to meet claims.
Steed has submitted a flurry of records in recent weeks in the Stanfill bankruptcy including a request to hire Powell Auction to help sell of Stanfill assets.
Records filed and entered last week in court show show Stanfill has assets of about $2.63 million and liabilities of $1.656 million.
Assets include the house and 3 acres on Westland Drive.. Liabilities include secured claims by banks totaling $1.4 million and $256,817 in unsecured claims, according to records.
Household goods and furnishings are valued at $40,000. About $40,000 in jewelry is now being held by the Federal Bureau of Investigation, according to court records.
Stanfill, documents show, has a 50 percent ownership in an entity identified as Madison Tucker GP. It owns two pieces of real estate in Knoxville - a commercial piece at 3523 Sutherland Ave. and a small rental home at 3520 Lyle Ave. Their value is unknown.
Stanfill also owns about $25,000 in office furnishings that were used at her former office at 1111 Northshore Drive.
In terms of other personal property, records show this notation: "Fifth Amendment asserted as to all other business entities."
FBI agents raided Stanfill's office earlier this year. U.S. prosecutors have acknowledged in court an ongoing criminal investigation.
Records show Stanfill has faced action in court several times before.
In 2009, Gordon and Christine Parton filed suit in Knox County Circuit again Jacqueline Stanfill and an entity known as Stanfill Development Group. The firm had the same address on Northshore as Stanfill Wealth Management.
The Partons alleged that Jacqueline Stanfill had purchased annuities for them for investment purposes. In 2005, she told them she was getting out of the financial services business and that their accounts would take care of themselves, the lawsuit states.
When the Partons tried a couple times to reach her subsequently, they couldn't find her.
Then, in September 2008, she suddenly surfaced, according to the lawsuit. According to the Partons, she approached them and said she was concerned about the financial performance of their annuities and that they weren't as healthy in light of the recession.
She advised them to change investment options. She told them she cared about them and wanted them to do well, according to the lawsuit.
Convinced by Stanfill, the lawsuit states, the Partons let her buy annuities from different providers.
The Partons, however, allege that they then discovered that their original annuity firms had been fine financially. They suffered financial hardship amounting to more than $250,000 because of her advice that they sell. And they say Stanfill earned a commission for herself based on her own advice that they switch annuities.
The parties settled the lawsuit in 2011, records show.
In December 2011, records show, Mountain Commerce Bank filed suit against Jacqueline Stanfill and Stanfill Development Group in Knox County Chancer Court.
In March 2007, Stanfill executed a promissory note with the bank for $750,000. The note was modified in March 2008 to raise the total principal to $875,000, according to the lawsuit.
Also, the bank alleged, Stanfill took out a second note of $524,250 in May 2007.
In November 2011, the bank demanded payment. The next month, it filed suit, alleging that Stanfill and her firm were in default.
Five months later, a dismissal order was issued noting the parties had resolved the action.