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By May, the Araujos had signed a contract and taken a second mortgage on their home to pay for the $38,252 remodeling job. The work was to include new cabinets in the kitchen, new bathroom fixtures, a new exterior, and some extra goodies: a hot tub and deck in the back yard, a fish tank in the living room wall, and upgraded carpet throughout the house. Simply put, it was going to be the Araujos' dream home.
Work on the house began in July. Smith paid for the Araujos to stay at a Holiday Inn for four weeks while the work was being done on their home.
A few weeks into the job, Smith came to Pamela Araujo's workplace to pick up the last of the $30,000 in payments.
"The following day he was gone," Araujo remembers. "There was nothing in the house except for painted walls, and all the guys were lined up outside of the house, and he was gone."
Smith had not paid any of the subcontractors hired to work on the house. He had also sold or given away the Araujos' appliances (something he later told police they had authorized him to do).
The Araujos were, understandably, furious. Todd Araujo, brandishing a gun, went to an address in Union City given to him by Smith's answering service. Smith ran out of the house to a neighbor's and called the police. Before it was over, both men were arrested.
But the Araujos were not the only ones who had hired Smith's remodeling firm. About a month before the Araujos hired Smith, he met Gwendolyn and Philip Senegal. He even brought Do, the contractor, to their house to take a look at the job.
"I had been recently married," remembers Gwen Senegal. "I owned the house before I got married. We needed to do something to the house to change it, so that it would become our house. We were anxious to have it happen. He was offering a remarkable price."
Senegal says she too called the Contractors State License Board and the Better Business Bureau, which told her simply that they didn't have any complaints filed against the company. Smith put the Senegals up in the Holiday Inn in Union City for a few weeks. The Senegals made three payments to Smith totaling $25,000 during the three weeks that work was under way on their home.
"They gutted the place and did a lot of work," Senegal says. "After 10 days, he was missing. I kept calling, he would not call me back. This went on for about a month. After two weeks, we moved back home with things up in the air."
In the end, the Araujo and the Senegal families were each out more than $25,000. Each had to hire new contractors. The families also had to pay the subcontractors Smith had hired, many of whom had filed liens on the families' homes, and reimburse them for materials that had been ordered in their names.
"We had lived in the house for four years before this. [Then] we paid $2,400 a month for six years on a $100,000 house," says Pamela Araujo. "Everything we had went back into putting things back into the house."
Smith was charged with four felony counts of fraud in Newark. Eventually, a plea bargain involving these and other charges would earn him five years probation and what the law calls "mandatory restitution."
Alameda County Probation Department refuses to release information regarding the status of Smith's restitution payments to his victims. But both Gwendolyn Senegal and Pamela Araujo say they received just $25 every other month for about four years. Then, they say, Smith stopped paying.
The Senegals lost a lawsuit they filed against Do, the contractor; the court found that Smith had used Do's license without his permission.
The Araujos eventually sold their house at a loss.
Pamela Araujo sums it up simply:
"He has ruined my life."
"That was another situation that unnecessarily went sour," Smith says. "Unfortunately my track record doesn't look that great."
Smith contends that he became ill and missed two days of work, an absence that caused the Senegals and the Araujos to mistakenly think he wasn't coming back. It was, he says, just another misunderstanding.
"I did not pay them off," he says. "That's why I'm trying to get on my feet [with the Lamborghini time-share deal], so that I can pay the people I owe.
"Both owners were very negative," he says. "They didn't want me to finish the projects."
The advertisement in the Oakland Tribune on Feb. 10, 1990, was enticing -- a two-bedroom "luxury condo" near Lake Merritt for $655 a month.
During the next few days, a stream of would-be tenants flowed through the condominium, all of them meeting with a man who introduced himself as Dane Smith, the landlord. In fact, it was Daniel Smith, who did not own, but was leasing the condo.
According to court files, Smith took a $25 fee for a credit check and a $500 security deposit from at least 11 people before he was arrested. One woman remembered seeing a pile of money on the floor of a closet as Smith was showing her around the condo. When the prospective renters couldn't get ahold of Smith after giving him deposits, they began showing up at Oakland Police stations.
