Officials with the Idaho Department of Finance say a group of Idahoans who lost more than $3 million as part of bogus hotel investment in the mid 2000’s will get back about half of a million dollars.

The Department of Finance sued "primary promoters" Derek Elliot, James Catledge, Sun Village Juan Dolio Associates LLC, and Impact Inc. in 2009, when those people (and their companies) did not repay almost 30 Idahoans who invested $3.4 million to pay for the construction of two hotels in the Dominican Republic. Those investors, who put their money into the companies in 2005 and 2006, were promised a quarterly payment with a fixed rate of return and their money back in five years.

But the investors actually bought time shares in the hotels lasting 45 years, according to a lawsuit. The suit also said the promoters stopped paying quarterly returns and refused to repay investors who wanted their money. Department of Finance officials said Elliot, Catledge, and the companies sold unregistered securities and violated Idaho’s securities fraud statute.

Judgments of $2.6 million and $3.4 million were eventually entered against Elliot and Catledge. Because of these various court orders and settlements resolving matters with all defendants except Elliott (and his company), those Idaho investors are expected to get back about $510,000, Department of Finance officials said.

"While the court orders and related settlements will not make Idaho investors completely whole, they do provide some relief for Idahoans whose money was lost some years ago," Idaho Department of Finance Director Gavin Gee said Tuesday.

Investigations Chief Jim Burns said department officials began investigating the promoters in 2006, after being contacted by a prospective investor.

That investigation revealed the fraud and led the department to issue a cease-and-desist order in July 2007 for Elliot, Catledge and their companies. The order required them to return the money to any investors who asked for it back. Both men refused, Burns said.

The lawsuit said Elliot and his companies functioned as the real estate developer and received most of the $3 million. Burns said investors were solicited by members of Catledge's Impact Group, which handled marketing. Catledge and other defendants who worked for the Impact Group are not licensed to sell securities in Idaho, the lawsuit said.

Department of Finance officials said Tuesday the collection of the $2.6 million judgment against Elliot "appears unlikely."