Special agents with the FBI, the Federal Housing Finance Agency’s Office of Inspector General (HUD-OIG), and IRS-Criminal Investigation arrested five people who were alleged to have orchestrated a “builder bailout” scam involving over 100 condominium properties around the country after a federal indictment charged them with various counts of bank fraud and wire fraud.
According to an FBI press release, the scheme, which was operated out of Excel Investments and related companies that were based in Irvine and then Santa Ana, allegedly targeted new condominium developments which the defendants identified the builders as having trouble selling the units. The defendants entered into agreements with the builders, whose project were located in California, Arizona and Florida, and agreed to buy the units in exchange for large commissions. They recruited the straw buyers and fabricated the loan applications (loan fraud, mortgage fraud) by submitting altered or fraudulent W-2 forms, income and asset statements. The lenders were not aware of the excessive commissions because they were disguised as “marketing fees” which were concealed in the form of false HUD-1 Settlement statements by the defendants.
The five defendants who were arrested and taken into custody are as follows:
- Aref Abaji, 31, of Aliso Viejo, a real estate agent
- Maher Obagi, 26, of Huntington Beach, the brother of Aref Abaji
- Jacqueline Burchell, 52, of Orange, an escrow agent
- Mohamed Salah, 37, of Mission Viejo
- Mohamed El Tahir, 35, of Glen Burnie, Maryland
Many of the loans obviously went into default and there were subsequent foreclosures. The taxpayer is the ultimate loser because of the $6.2 million in losses suffered, $2.37 million were loans backed by Federal Home Loan Mortgage Corporation (Freddie Mac) and the Federal National Mortgage Association (Fannie Mae).
Defendant Jackie Burchell was named in a previous post on the California Real Estate Fraud Report in June 2012 in which the FBI was investigating cases of short sale fraud in Los Angeles and Orange Counties.