Colony Ridge developers faced lawsuits, complaints from Houston-area residents for over a decade

The Colony Ridge development northeast of Houston has become synonymous with scandal on a national scale — first as a source of viral anti-immigrant conspiracy theories and then as the target of a recently filed federal lawsuit alleging illegal business practices. But the developers behind the Liberty County community, including brothers John and William “Trey” Harris III, are no strangers to controversy. The Harris brothers’ business model has changed little since at least 2005: They buy and sell cheap plots of land in the Houston exurbs, typically marketing to predominantly Latino and low-income families looking to escape rising housing costs closer to the urban core. Residents in a Montgomery County subdivision associated with the Harrises, for instance, say they have long dealt with the same issues as those made famous by their larger sister development in Liberty County: inadequate roads, drainage and amenities; high rates of foreclosure.

But it took Colony Ridge beginning to build out a whopping 17,000 lots in western Liberty County — covering an area equivalent to half of Houston’s Inner Loop — to put the Harris brothers on the radar of federal regulators and state politicians. Neither the Harris brothers nor anyone else disputes that many foreign nationals live in Colony Ridge, but conspiracy theories that began circulating last year allege the area is violent and drug-infested, even controlled by Mexican cartels — all claims debunked by residents, the developers and local law enforcement. The allegations in a Dec. 20 lawsuit filed by the U.S Department of Justice and the Consumer Financial Protection Bureau may prove thornier for the Harrises. They are accused of baiting Latinos with targeted social media ads, then saddling buyers with predatory loans at high interest rates. Nearly 1 in 3 Colony Ridge properties enters foreclosure — 10 times the national average, the DOJ said — and many lots are then flipped at a profit. John Harris has called the lawsuit “outrageous and inflammatory.” Harris has acknowledged the company’s approach produces many foreclosures, but has said it also lets low-income buyers “who have no opportunity to get a loan from anyone else” achieve “the American Dream of owning property.”