Key figure in a major housing fraud case admits his role after an exclusive 5 On Your Side report

CLEVELAND - A key figure in a major housing fraud case admits his role--on camera--following an exclusive 5 On Your Side investigation.

Marc Tow was a partner in a real estate scheme that bought and sold foreclosed homes in Cleveland. Unsuspecting investors were told it would rehab homes and revitalize neighborhoods.

"It was supposed to be a win-win all the way around," said investor Rose Ragan.

Instead, she lost $60,000 after trusting Tow with the funds in an escrow account she believed he was managing. The cash was to be used toward purchasing foreclosed homes in Cleveland.

Tow's company was known as EZ Access Funding and he was a business partner with another man whose real name Michael Pedwell-- but who we discovered had faked his own death in an insurance fraud scheme decades ago, later emerging as Michael Alexander.

[Click here for a map of EZ Access-owned properties in the Cleveland area http://on.wews.com/xTA0qQ ]

The company closed its doors leaving hundreds of investors wondering where their money went. Tow and Alexander seemed to vanish into thin air--until now.

Our 5 On Your Side investigation found Marc Tow living in Southern California--but claiming to have moved his home and business to Kansas.

Tow told NewsChannel5 that his former business partner ripped off investors and is now living in a $12 million-home somewhere in Southern California. In letters to investors, Tow claims Alexander stole in excess of $2 million and forged his signature on closing documents.

"I didn't run to a foreign country," Tow said." I'm not running rich."

Tow insists he trusted Alexander and was misled. And in a stunning admission, admits their EZ Access Funding scheme was a fraud.

"You could blame it on me, you could blame it on Michael Alexander," said Tow, "But there are a lot more people at fault in this big game."

Tow insists the sellers of properties failed to disclose the real condition of abandoned and foreclosed homes in order to make profits off unsuspecting investors.

Our exclusive investigation continue Friday on NewsChannel5 at 11 p.m. with an even more surprising admission from Tow's former partner.