Friday, October 9 , 2015, 3:01 pm | Fair 92º

Fire Victims Have Their Say Against Woman Who Pleaded Guilty in Rebuild Scam

Penny Estes is sentenced to more than 11 years in prison on charges of swindling millions of dollars from those who lost their homes

Penny Estes leaves court Wednesday after being sentenced to 11 years and 8 months in prison on counts of bilking victims of the Jesusita and Tea fires out of millions of dollars.
Penny Estes leaves court Wednesday after being sentenced to 11 years and 8 months in prison on counts of bilking victims of the Jesusita and Tea fires out of millions of dollars.  (Lara Cooper / Noozhawk photo)

By Lara Cooper, Noozhawk Staff Writer | @laraanncooper |

The Jesusita and Tea fires brought two waves of destruction to the South Coast when they ripped through the hills above Santa Barbara, destroying hundreds of homes in 2008 and 2009.

The third wave of destruction wasn't a fire at all, but a person, according to a handful of victims who testified in Santa Barbara Superior Court on Wednesday.

They said that person was Penny Estes, who pleaded guilty last year to dozens of counts of bilking fire victims out of millions of dollars by promising to rebuild their homes but spending the cash on shopping sprees, nail salons and trips.

On Wednesday, Estes was sentenced to 11 years and 8 months in prison and has 437 days of credit for time served, but not before victims spoke about how Estes had ruined their lives at a time when they had lost everything.

Dr. William Koonce told the court that he lost his home in the Jesusita Fire, and he recalled seeing patients who had also lost their homes in the fire, and listening as they "vigorously promoted" using Estes for their rebuilds.

Estes was charismatic, Koonce said, and he hired her, but started to become suspicious that something was wrong during the process when she wouldn't produce receipts for the work.

"I started getting very uncomfortable, like there was a monster under the bed, and I kept looking," he said.

Koonce eventually found out that Estes had been lying to him and work that should have been done was never completed, he said, prompting him to contact the District Attorney's Office. After losing everything, Koonce recalled making house calls to patients on Christmas Eve to make money to provide rent for his family. He even treated Estes personally when her asthma was acting up.

"She is so good at fraud," he said, asking the judge to give her the maximum sentence. "I'm not here for closure, or vindication. I'm here because it's your job to make sure she doesn't hurt anyone else."

Another victim, Nancy Keltner, said many people had already been taken advantage of by the unethical practices of insurance companies and adjustors before Estes swindled them.

Keltner recalled living with her daughter in a "leaky, old trailer" parked on top of the concrete slab, all that was left of their old home. They pulled their water for their outdoor shower and toilet from a garden hose, while "Estes lived at the Montecito Inn" at her victim's expense, Keltner said.

No work was ever done on her property.

Former Mountain Drive resident Christine Walden recalled that Estes greeted the people whose business she sought with hugs and assurances that she would help put them back in their homes, but actually lacked empathy, she said.

Robert and Kate Hillery also spoke in court, and said Estes had worked on their Riverside County home and had even brought 85-year-old Robert flowers when he was in the hospital for back surgery. 

The Hillerys said they ended up paying more than $500,000 from their family trust for work that wasn't up to code or was never completed.

"She came to them as a sign of hope," prosecutor Gary Gemberling said, asking the judge to impose the maximum sentence of 17 years. "All these people wanted was a chance to get their lives back."

Her attorney, Brian Mathis, described Estes as someone who had suffered physically from black mold earlier in her life, and felt strongly about her business, which aimed to help people rebuild in a smarter way.

She heard about the fires and "saw a chance to help," he said. "She was clearly out of her depth."

Mathis reminded the judge that she had been an upstanding citizen up until the incident, and "the life that preceded this has to county for something."

Estes, 64, had been clinically depressed since the incident and had even attempted suicide, he said.

An emotional Estes spoke, saying she put too much trust in her business partner, Don Alexander, and the attorney who helped them form the business.

"I was the weak link," she said, adding that she was "deeply sorry" for victims hurt "by my actions or lack of knowledge."

Gemberling took issue with the implication that Estes herself had been bilked and had no knowledge of the situation.

"She preyed upon people in desperate situations and she did it on purpose," he said. 

He described what investigators found on her bank statements, including shopping sprees in New York City and $1,000 dinners at Lucky's in Montecito.

"She was living it up, in a big way," he said.

Judge John Dobroth responded before issuing his sentence, stating he believed Estes was very conscious of her actions. The judge was direct.

"She's just a crook," he told the court. "Somewhere along the way in her life, she lost the empathy gene."

Noozhawk staff writer Lara Cooper can be reached at .(JavaScript must be enabled to view this email address). Follow Noozhawk on Twitter: @noozhawk, @NoozhawkNews and @NoozhawkBiz. Connect with Noozhawk on Facebook.

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