A state judge is ordering the developer of a failed housing project in Lakeville geared toward East Africans to pay $4.5 million to its clients and in penalties to the state.
Hennepin County District Court Judge Christian Sande issued the monetary penalty in late December against Nolosha Development. The ruling came five months after Sande ordered a default judgement against the company for not cooperating in a lawsuit filed against it by the Minnesota Attorney General’s Office.
Sande also ruled that the company must pay the Attorney General’s Office $339,500 in court fees.
The attorney general filed a lawsuit in October 2024 charging Nolosha with consumer fraud, deceptive trade practices and false advertising. Sande’s ruling on the default judgement effectively ended the prosecution of Nolosha and ruled in the attorney general’s favor.
Nolosha had spent the majority of that lawsuit unrepresented by an attorney, and did not comply with Sande’s rulings to hand over internal documents to the attorney general.
“This has gotten preposterous, frankly,” Sande told Nolosha CEO Abdiwali Abdullahi at an April court hearing.
Abdiwali marketed Nolosha toward East Africans as a walkable, Muslim-focused suburban dream community featuring affordable homes, a mosque, a school and restaurants. Nolosha never owned the Lakeville parcel that it claimed it would develop, let alone obtain city permits to build homes.
Yet, Nolosha started collecting deposits in 2022 of up to $25,000 per home from at least 160 prospective homeowners.
Sande, in his ruling, noted that the $4.5 million penalty for Nolosha is “necessary to remediate” both the 160 clients who paid hefty deposits for homes as well as additional customers who paid $500 to be on Nolosha’s waiting list.
Sande held an evidentiary hearing in September to determine how much Nolosha should pay its former clients and the state. Three of the company’s former clients — Muhammed Mohamud, Abdulkarim Mohamud and Hassan Hamza — testified at the hearing that they each paid Nolosha tens of thousands of dollars in exchange for homes, and did not receive full refunds. Sahan Journal profiled the three men in a story earlier this year.
The attorney general’s office also presented evidence at the hearing about 14 other prospective homeowners who were also allegedly scammed by Nolosha.
Abdiwali did not attend the September hearing.
The attorney general’s office ultimately asked for Nolosha to pay $4.5 million in restitution.
