Ex-Green Street employee alleges developer misled investors

ST. LOUIS — A former employee of a once-prolific city developer is alleging the company misled investors and then fired him after he blew the whistle on the deceit, according to a lawsuit recently filed.

Steve Mabry was a director of asset management for St. Louis-based Green Street Real Estate Ventures, known for its apartments in The Grove and its redevelopment of The Armory in Midtown.

Mabry alleges he discovered wrong or misleading accounting in 2022 that made Green Street’s finances appear better to investors, according to a lawsuit filed in St. Louis Circuit Court.

Mabry alerted company leaders, and refused to present the information to investors, the suit says. A little over a month later, he was fired.

Neither Mabry nor Green Street Principals Phil Hulse and Kevin Morrell responded to a request for comment. No attorney was listed for Green Street. 

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The lawsuit is one of more than two dozen that have been filed against Green Street over the past year as financial problems have stacked up. Contractors have sued, alleging their work went unpaid. Numerous employees have left or been laid off. The company faces pushback from City Hall due to Green Street’s unpaid taxes

And, just Monday, an investor filed a separate lawsuit alleging the company, Hulse and Morrell owes him $2.9 million. 

Its projects have all but stalled. 

As a director of asset management, Mabry’s responsibilities included communicating with investors about their investments and persuading more investors to invest in the company, the lawsuit states. 

As he was preparing a presentation for investors in fall 2022, Mabry alleged financial data he received made Green Street’s assets look bigger or more desirable and its liabilities look smaller to investors. The suit contends that he informed the chief operating officer, controller and company accountants about the “misrepresentations.”

Mabry alleges the accountants and controller confirmed the financial data was misrepresented and that it couldn’t be presented to investors. He contends that he met with Morrell, one of Green Street’s leaders, on Oct. 6 and “blew the whistle” about the financial data as well as “other company wrongdoing and illegal activity” he was instructed to perform such as illegally charging commercials tenants taxes at a Market Street property.

Mabry told Morrell that he refused to invoice tenants the illegal charges, the suit says; Morrell “acknowledged” that and the financial data.

But shortly after that meeting, Mabry’s duties were given to younger, female employees. And on Nov. 18, he was fired, court documents say. 

The suit alleges that Green Street “in fact did disclose and publish to investors the accounting misrepresentations despite Steve’s warnings and refusal to participate in the wrongdoing.”

Mabry also contends that the company used Mabry’s wife’s social security number on his wage and tax statement and that it affected his ability to apply for and receive Social Security benefits. 

No further details about the financial data was included in court documents. 

Investor expectations for a cut to US interest rates in March were quashed by strong economic data and clear communications from Jay Powell, the Federal Reserve Chair. While traders have anticipated the Fed’s rate cuts, their predictions differ from the Fed’s own projections, potentially leading to market volatility. The Federal Reserve has maintained interest rates at a 23-year peak, between 5.25% and 5.5%, as part of its strategy to manage inflation.

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