The most expensive home ever sold at a Multnomah County sheriff's foreclosure auction will go on the block April 2.
It's a 20,000-square-foot, $6.8 million mansion atop the Southwest Hills, the last Portland home owned by Andrew Wiederhorn.
The sale may be the final act in the scandalous financial history of Wiederhorn's time here, a story that includes fraud, a trip to federal prison and a lot of empty-handed investors.
More than a decade ago, Wiederhorn was at the center of the financial meltdown of Capital Consultants, an investment company headed by another Portland power player, Jeff Grayson.
Wiederhorn grew up in Portland but since 2009 has lived in California, where his primary investment, the Fatburger fast-food chain, is headquartered.
He now lives in a Beverly Hills home (Zillow.com values it at $10 million) and is philosophical about the foreclosure.
"I haven't lived in the house for five years," he says of the Portland mansion. "And my family's been out of it for four years."
"I'm looking forward to not paying the utilities," he adds.
Everything about the house is outsized—it's got 10 bedrooms, an indoor basketball court with an ornate "W" painted on the floor, a 2,000-square-foot pool house and a five-car garage. Property taxes are $115,000 a year.
In 1995, before he'd turned 30, Wiederhorn paid $1.5 million for the Southwest Greenleaf Drive property previously owned by Sequent Computer Systems co-founder Casey Powell.
At the time, Wiederhorn was considered a business phenomenon. His company, Wilshire Financial Services Group, made its money buying bad loans at deep discounts. His stock in the company grew to be worth nearly $140 million when Wiederhorn was only 32. A 1997 Oregonian profile dubbed him the "$100 Million Dad."
Wiederhorn says he plowed another $10 million into the Portland house, renovating and expanding it for his wife, Tiffany, and six children.
But his business cratered in 1999, amid a global debt crisis. Wilshire spiraled into bankruptcy, but that was the least of Wiederhorn's problems.
He had formed a symbiotic relationship with Grayson, whose company handled union pension-fund investments. Grayson was actually running a Ponzi scheme, funneling money to Wiederhorn in exchange for personal loans.
When Wilshire collapsed, Grayson's clients took the hit, resulting in what federal officials called the largest union pension fraud in U.S. history.
Grayson, who suffered from multiple sclerosis, pleaded guilty to fraud but suffered a stroke and never went to prison. He died in 2009 at age 67.
In June 2004, Wiederhorn pleaded guilty to federal charges of paying an illegal gratuity and filing a false tax return. He was sentenced to 18 months in prison; he served 14 months. The U.S. Securities and Exchange Commission sanctioned his new company, Fog Cutter Capital, for continuing to pay Wiederhorn's salary and a $2 million bonus while he was imprisoned.
In 2011, Wiederhorn put the Portland house on the market for $6 million but found no buyers.
Documents show that Wiederhorn today owes Citibank $4.3 million on the Portland house, a sum that is growing by more than $1,000 a day.
"I signed the house over to the bank a year ago," Wiederhorn says. "After this, they'll release me from the debt."
Wiederhorn says he still owns a 9-acre oceanfront estate in Gearhart but that he's done with Portland. "I don't have any plans to live in Oregon," he says.
Since his legal problems, Wiederhorn has focused on building Fatburger. Last year, he appeared on CBS's Undercover Boss, where he portrayed himself as a benevolent CEO tripped up by bad legal advice but intent on making employees' lives better.
Tom Chamberlain, president of the AFL-CIO of Oregon, scoffs at Wiederhorn's claim to care about employees. He says union workers and pensioners are still dealing with the financial hit delivered by Grayson and Wiederhorn.
"To be able to ruin workers' lives and then move down to L.A. to run a company and live in a very nice house is unbelievable," Chamberlain says. "It's a shining example of what's wrong with our criminal justice system and our economy.â