K
aren Winnick, a 79‑year‑old widow and former children’s book author, is fighting a foreclosure on the 60‑room Casa Encantada, a 1930s Los Angeles mansion that once held the title of the most expensive U.S. home. The property, which sits on 8.4 acres beside the Bel Air Country Club, covers 40,000 sq ft and includes seven bedrooms, a walnut‑paneled library, hand‑lacquered dining walls, and an Art Deco‑styled living area. The house, once owned by moguls such as Conrad Hilton and David Murdock, was purchased by the Winnicks for $94 million in 2000.
After her husband Gary’s death in 2023, Karen became the sole steward of the estate. On Tuesday, she and her son Alexander filed a cross‑complaint in the Los Angeles Superior Court alleging that a 2020 loan of $100 million, arranged by CIM Group and its co‑founder Richard Ressler, was a “loan‑to‑own” scheme that left her effectively destitute. The loan, which was secured by Casa Encantada, a Malibu home co‑owned by the Winnick sons, and a collection of family artwork, furniture, antiques and jewelry, has ballooned to over $155 million. Karen claims she was unaware of the loan’s terms and that the collateral was used without her consent. She says the sale, scheduled for December 16 behind a fountain at California’s Civic Center Plaza, could strip her of her home, life savings and even her wedding ring.
CIM Group, a commercial developer that also owns 432 Park Ave on Manhattan’s Billionaires’ Row, has denied the allegations, calling them “fantastical.” In a statement, CIM said the loan was a refinance of an existing business loan, matured in January 2025, and that the borrowers were sophisticated parties who negotiated the terms with counsel. The lender maintains that the family’s claim of elder abuse and concealment is an attempt to evade repayment. CIM also notes that the family had found a buyer willing to pay a substantial portion of the debt, but the lender insists the auction should proceed.
Gary Winnick, once one of Los Angeles’ wealthiest men and founder of Global Crossing, faced mounting financial demands in the early 2000s, leading to the company’s bankruptcy in 2002. He turned to CIM for help, receiving the $100 million loan in 2020. The loan’s notice of sale was filed in September, citing missed payments on Casa Encantada and the Malibu property. CIM’s lawyers argue that the loan’s interest would quickly cripple even the wealthiest, and that the family’s accusations are a strategy to rewrite history.
Karen’s attorneys say she only saw signature pages and lacked the financial knowledge to understand the loan’s implications. CIM counters that Karen drew advances after her husband’s death, indicating her awareness of the agreement. The dispute also involves the family’s collection of high‑value items, which were listed as collateral.
The Casa Encantada auction will take place behind a fountain in the Civic Center Plaza. The property’s grounds feature a swimming pool, a tennis pavilion, and overlook the Bel Air Country Club golf course. Gary had hired designer Peter Marino to restore the home’s interiors to their former Deco Hollywood glory before his death. The auction is expected to attract bidders willing to pay the highest price for this historic estate.
