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Five clients who purchased homes from Chad Banken testified this week that the real estate broker deceived them by not properly disclosing the terms of their loans.

Banken’s attorney, Jack Pierce, countered these arguments by showing the jury emails and purchase agreements Banken sent to the buyers disclosing the terms of their home loans. The documents included a chart showing three pricing options and information about how paying a bigger down payment would lead to a lower total cost.

Three members of a Somali family who bought a large Lakeville home from Banken in 2022 testified earlier this week. Banken evicted the family from the home in 2023. At one point, Pierce went over the chart of pricing possibilities that Banken had sent the family before they bought the home.

“Did you talk to your mom about this chart?” Pierce asked Hassan Salat, who testified Tuesday and Wednesday.

“We did, but it was very confusing,” Salat answered.

Banken is on trial for allegedly breaking the state’s consumer fraud laws and for deceptive trade practices laws. Banken sold 160 homes using contracts for deed, which offer fewer protections for consumers compared to conventional mortgages. 

Attorney General Keith Ellison brought the charges against Banken in a 2024 lawsuit in Hennepin County civil court. The lawsuit alleges that Banken inflated home prices and pressured homebuyers to pay large down payments, essentially setting them up to fail. Real estate agents found homes for their customers that Banken bought then and sold to the clients that same day at higher prices.

He’s also accused of discriminating against Muslims in violation of the Minnesota Human Rights Act, and of falsely telling clients that his contracts did not include interest, which is generally forbidden in Islam. 

Christopher Willette, a real estate agent, also testified against Banken this week, and gave a similar answer to Salat’s when Pierce showed him a similar pricing chart Banken had sent him before he purchased a condo from Banken.

“In my opinion, the grid is pretty confusing,” Willette said.

The Minnesota Attorney General’s Office argued that Banken’s charts were not sufficient, and that he violated multiple state consumer protection laws. The attorney general’s office also argued that Banken’s purchase agreements highlighted the price Banken paid for the house and downplayed the higher price he charged buyers for the same house. 

“The terms of the contract were buried in the paperwork,” Assistant Attorney General Karthik Raman argued during opening statements early in the week. 

Lawyers from the attorney general’s office showed jurors a contract with Omar Kahn, who bought a home from Banken in 2020 and was evicted by Banken in March of this year. Kahn’s contract showed that he had a fixed interest rate. But lower in the same contract, there was a clause that said his interest rate would change after five years to an adjustable rate.

Kahn testified Thursday that neither his real estate agent nor Banken told him his interest rate would change after five years.

Kahn’s monthly payment started at $2,490 in 2020 and jumped to $3,840 by October of 2025, when his interest rate changed. 

Kahn and Jessica Lacasse, another buyer who purchased a home from Banken using contract for deed, both testified Thursday that they had made offers on their homes thinking that they were paying the initial price Banken had paid, not the more expensive “flip” price Banken was actually charging them. 

Jurors are being asked to determine whether there is “a preponderance of evidence” that Banken, who is expected to testify next week, is liable for the charges brought against him. Banken could potentially face financial penalties, including restitution, if the jury decides the case in favor of the attorney general’s office; prison time is not an option in civil matters.

The trial started on Monday, June 8, and is expected to continue through all of next week.

In an attempt to address allegations that Banken tried to hide interest payments in his contracts, Pierce showed Salat the pricing chart and pointed out that one of the columns states that a potential loan would include interest. 

“Did you talk to your brother and mom about it?” Pierce asked. 

Yes, Salat said, adding that his mom told him the interest wouldn’t apply to them. He testified that his realtor, Ismail Harun, told them that their $50,000 down payment would instead pay for the difference that the interest would cost. 

Salat’s family bought the home for $678,000, a markup from the $610,000 that Banken bought it for, according to trial testimony.

Salat testified that he was always skeptical of the purchase, and alleged that Banken manipulated his mother, who does not speak proficient English, into the sale.

“It seemed too good to be true,” Salat said. “You’re gonna get this brand new home and not have to pay interest? Mom believed everything they were saying, and I didn’t believe it at all. It was too good to be true.”

Banken also allegedly made his clients use their limited liability corporations to buy homes. Salat’s brother, Daud Salat, bought the family home using his trucking LLC. Willette bought his condo using his notary service LLC. And Abdinoor Igal, who testified earlier in the week, bought his home using his trucking LLC.

The attorney general’s office alleges that Banken used this method to disguise the sales as business transactions, knowing that such transactions have fewer consumer protections than personal sales.

“Did you ever park your truck at your Lakeville home?” Assistant Attorney General Mark Iris asked Daud Salat when he testified.

“There was not enough space to park there,” Daud Salat said. 

Hassan and Daud Salat’s mother, Fowsiyo Hassan, wanted out of their contract after learning it had interest. Banken said he wouldn’t talk to her because the home was in Daud Salat’s business’ name and not hers, the brothers testified.

Banken eventually evicted the family from their home.

Similarly, Willette testified that he didn’t know that using his LLC would be a problem until he tried multiple times to apply for bankruptcy protection a few years after purchasing his condo. Willette was denied each time because his condo was in his LLC and bankruptcy court suspected fraud.

The attorney general’s office showed jurors texts Willette sent Banken asking Banken to change his contract from his LLC to his name. 

“Ignoring me won’t help either Chad,” read one of Willette’s texts. “You have no right not to sign. I need that signed ASAP. To be in my name instead of LLC. Don’t make this difficult.”

“Attorneys need to resolve,” Banken replied. 

“What was the resolution?” Iris asked Willette.

“There was none,” Willette responded. 

Willette testified that he bought the condo on a contract for deed following a divorce that left him with bad credit and an inability to qualify for a conventional mortgage. But the process with Banken caused him to lose between $25,000 and $30,000, and left him feeling “cheated,” Willette told the court.

Willette testified that he wasn’t able to get the homestead exemption for his condo from Hennepin County, which would have lowered his property taxes, because the condo was in his business’s name and not his own. 

Pierce asked Willette, who has 30 years of experience as a real estate agent, why this would come as a surprise to him.

“There’s different intricacies to this business,” Willette said. “I don’t know everything there is to know about real estate.”

“You could have asked someone in your office?” Pierce suggested.

The defense has built a case around the assertion that Banken disclosed the terms of his home sales in writing, and that some real estate agents didn’t properly communicate them with their clients.

“No one who testifies will say Banken wrote something wrong,” Pierce said in his opening statements Monday. “They’ll instead say, ‘Someone told me something.’”

He also argued that buyers willingly signed onto the terms of their loans. 

Igal bought a Lakeville home from Banken in 2022 and abandoned it the following year after he could no longer pay for it, losing $170,000 in payments he had already made directly to Banken.

While cross-examining Igal earlier this week, Pierce emphasized that Igal had signed a document releasing all claims against Banken in order to leave the home.

“I did not have a choice,” Igal testified earlier this week. “It was just me and him. He came to my house, he came with the document, he said,  ‘Sign it.’”

A part of the defense’s argument at trial is that the buyers’ real estate agents were all supposed to be familiar with contracts for deed, per their training and certification, and that they were supposed to advocate for their clients’ interests. 

“There may have been some situations where a particular real estate agent, or two or three, weren’t particularly clear on terms of the agreement,” Pierce said in his opening remarks earlier this week.

Pierce also said in his cross-examination that Igal’s real estate agent, not Banken, lied to Igal about his contract with Banken. 

“You were lied to by Mr. [Ismail] Harun?” Pierce asked, referring to Igal’s real estate agent.

“Chad and Harun, yes,” Igal responded.

At another point, Pierce showed an email Igal had written to Banken.

Pierce asked Igal if he indeed wrote that his real estate agent had lied to him.

“If you go by the email, but I know both —, ” Igal replied.

“Thank you,” Pierce said, cutting him off.

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Several witnesses testified that Minnesota real estate broker Chad Banken did not properly disclose the terms of their home loans.

Several homebuyers testify seller Chad Banken obscured terms of confusing loans

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