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Vaughan Deed Trustee Faces Civil Suit

ALBUQUERQUE, N.M. — Former Corrales businessman Doug Casteel, whose name appears in hundreds of documents in Doug Vaughan’s alleged Ponzi scheme, faces a civil lawsuit in Bernalillo County District Court over his involvement in the scheme that left 600 victims owed more than $70 million.

The six-count lawsuit, filed Thursday, is part of an effort to recover money for the victims by Judith Wagner, the court-appointed trustee in charge of the bankruptcy estate of Vaughan’s defunct Vaughan Company Realtors.

Casteel, who has been something of a mystery player in Vaughan’s scheme, is listed as the trustee in deeds of trust given to investors in Vaughan’s promissory note program from 1993 to 2009, the lawsuit says. The lawsuit identifies him as a property manager and qualifying broker for Casteel Management Services in Corrales.

Federal investigators say the promissory note program was a Ponzi scheme, an investment swindle in which money put up by later investors is used to pay off earlier ones. Vaughan faces a 30-count criminal indictment over the scheme.

The deeds of trust, which listed an assortment of mostly small rental properties plus Vaughan’s former mansion, were purported to serve as security for money that investors gave Vaughan in exchange for promissory notes. The deeds proved worthless for most all of the investors.


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Attempts to reach Casteel for comment have been unsuccessful. He no longer leases the office in Corrales where his company is registered with the Public Regulation Commission.

Casteel’s name appears in different capacities, sometimes as trustee and sometimes as beneficiary, in deeds of trust extending over the life of Vaughan’s promissory note program. The deeds were continuously modified, covering ever-increasing amounts of investor loans, according to the lawsuit.

Casteel signed some deeds, including one dated Dec. 30, 2009 — less than two months before the collapse of Vaughan’s business empire — according to James Askew of Arland & Associates, the firm representing Wagner in the civil lawsuit.

The lawsuit’s allegations include negligence, civil conspiracy and negligent misrepresentation. It does not seek a specific financial penalty against Casteel.