California Real Estate Fraud Report

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23
May

President of Discovery Sales Arrested in “Builder’s Bailout” Case

Ayman Shahid, 38, the president of Discovery Sales, was arrested and charged with conspiracy to commit bank fraud and 17 individual bank fraud counts.

Shahid, of Danville, is the seventh employee of Seeno Construction to be indicted in the case, which began in 2010 when FBI and IRS agents raided the firms Port Chicago Highway headquarters and removed boxes of evidence.

Discovery Sales is the selling  company for Discovery Homes and Seeno Homes. The Seeno family has a long history of construction in the Bay Area and in the past has been fined for “environmental improprieties.”

In Shahid’s case, federal prosecutors allege that, in order to keep sales prices of Seeno homes up during the financial downturn, provided large financial incentives to unqualified homebuyers. Prosecutors further allege that the incentives were concealed from both banks and appraisers (appraisal fraud) so that they loan would be approved (loan fraud, mortgage fraud). Because many of the buyers were unable to afford the loans, more than $154 million in losses was realized by the banks when the homes were either foreclosed or sold as short sales.

Two Discovery Sales employees pleaded guilty in this case last year and have agreed to cooperate with prosecutors.

Read the original article in the Mercury News.

 

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