January 18th, 2013 at 11:51am
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.
October 22nd, 2012 at 10:39am
A unique mortgage fraud case that was tried in federal court has come to an end with the only defendant of 24 to be acquitted.
Escrow officer Billie Bishop, 52, of La Mesa, unlike most of the other defendants, did not plead guilty and instead elected to go to trial. Bishop had been charged with wire fraud and making a false statement to a bank; her case was the first time the racketeering law was used in a mortgage fraud case.
Prosecutors had accused her of processing 77 transactions in a scheme where the other defendants received more than the listed price for homes, with the remainder going to an account earmarked for construction upgrades. This special account was managed by Darnell Bell, a Lincoln Park gang member. The homes were purchased in the days of Ninja loans (No Income No Job or Assets) and most were foreclosed after the straw buyers walked away, with Bell and his co-defendants pocketing the loan money (loan fraud, mortgage fraud).
Billie Bishop was tried before U.S. District Court Judge Larry A. Burns. The attorneys who represented her were Gastone Bebi and Jonathan Jordan.
After the trial, Bebi stated that prosecutors had been unable to prove that Bishop had any awareness that the construction work was being performed or that the sales were fraudulent (real estate fraud, escrow fraud).
Read the original article in U-T San Diego (San Diego Union Tribune).
September 20th, 2012 at 8:09pm
Kesha Danine Fortune Haynie, who facilitated the mortgage fraud crimes of Garret Griffith Gillilland and builder Tony Symmes, has been sentenced to serve a prison term for three years and 10 months.
Haynie, 41, received her sentence as a result of being convicted on two counts of mail fraud, for which she was prosecuted by the office of U.S. Attorney Benjamin Wagner. She was the operator of Empire Mortgage, located in Chico. The jury that convicted her was shown evidence that Haynie gave home purchasers cash kickback from Tony Symmes in consideration for purchasing their deliberately overpriced homes. Some of the overage was distributed to the homebuyers; Kesha Haynie and her co-conspirators split the rest. Straw buyers were involved with some of the purchases.
To read an earlier article which describes the prison terms to which Garret Gililland, Tony Symmes and their co-conspirators were sentenced, click on California Real Estate Fraud Report.
Read the original article in the Central Valley Business Times.
September 12th, 2012 at 7:40am
Deon L. Jackson, 38, a loan officer who pleaded guilty in a mortgage fraud conspiracy in the South Bay region of Southern California, has been sentenced to one year in federal prison.
Four others who pleaded guilty already received their sentences, as follows:
- Anthony Lewis, 57 months. Lewis found the homes for sale and submitted fraudulent loan applications to Jackson and Jennifer Le on behalf of straw buyers
- Jennifer Le, probation
- Matthew Balsz, a former South Bay U.S. Bank employee from the South Bay, charged with accepting bribes, probation
- Freddy Lentz, formerly of Bank of America, charged with accepting bribes, probation
Maria Arriaza, a former escrow officer at Diamond Clear Escrow in Granada Hills, went to trial and received a sentence of 40 month for preparing phony settlement statements (escrow fraud) and for disbursing funds according to Anthony Lewis’ instructions.
All told, lending institutions were defrauded out of $3 million.
There are several previous postings about this case and the defendants in the California Real Estate Fraud Report. Use the search button on the left-hand sidebar to locate them.
Read the original article in the Long Beach Press Telegram.
August 30th, 2012 at 6:49pm
Henrik Sardariani, 44, a Glendale resident accused of scamming banks and individuals out of millions in a loan fraud scheme, was sentenced to 10 years in federal prison. His co-conspirator and brother Hamlet Sardariani, 42, of Sylmar, will be sentenced next month for the same crimes.
Both brothers pleaded guilty to felony counts of wire fraud, conspiracy and money laundering in the court of U.S. District Judge Virginia Phillips, who ordered Henrik Sardariani to pay $5.4 million in restitution to his victims, along with a $100,000 fine.
Assistant U.S. Attorney Ranee Katzenstein termed the con “sophisticated and complex” and involved Henrik Sardariani creating phony government documents and fraudulent real estate documents that he authenticated by cutting and pasting notarizations (notary fraud). Sardariani secured his loans – which he admitted he had no intention of repaying – using his homes on Paseo Redondo in Burbank and on Maginn Drive in Glendale as collateral.
Wanda Tenney, an escrow officer, helped Sardariani avoid paying one of his loans back by helping him wire almost $2 million to a Hong Kong account (escrow fraud). Tenney pleaded guilty to conspiring to launder money and will be sentenced in October.
You can find an earlier article about the prosecution of Henrik Sardariani and Hamlet Sardariani by using the search window on the left-side or clicking on this link of the California Real Estate Fraud Report.
Read the original article for this post on the Glendale News Press.
June 15th, 2012 at 9:53am
Hamlet Sardariani, a 45-year old Sylmar man, has pleaded guilty to federal conspiracy and tax evasion charges in U.S. District Court in front of United States District Judge Virginia A. Phillips. Sardariani admitted that he conspired with others to procure four loans with a value over over $5 million by using houses he did not own as collateral. In addition, he confessed to forging documents and falsifying notary stamps (notary fraud).
Hamlet Sardariani’s brother, Henrik Sardariani, 44, of Glendale, pleaded guilty last January; Wanda Tenney, 66, of South Los Angeles, a former escrow officer, pleaded guilty on December 5; Christopher J. Woods, 53, of Beverly Hills, pleaded guilty on November 8. All three are awaiting their sentences.
This case was investigated by the FBI and IRS Criminal Investigation (CID).
Read the original article in the Imperial Valley News.
June 15th, 2012 at 9:27am
Two investors who sued an escrow office in Orange County for escrow fraud have been awarded $2.15 million in a jury trial.
On March 20, 2012, Klinedinst attorneys Greg A. Garbacz and Christopher D. Holt succeeded in trial involving a multi-million dollar fraud, breach of contract, and breach of fiduciary duty case. Gatew
In Christian Astillero, et al., v. Gateway Title Company, et al., Greg A. Garbacz and Christopher D. Holt represented the two investors who had lost $1,250,000 in a Ponzi scheme involving High Park Financial Group and its owner Edward Showalter. The investors had been told to deposit their funds with Gateway Title Company (now doing business as Pacific Coast Title, a Fidelity National Title subsidiary), which, without their knowledge or permission, had released funds before the escrow instructions had been satisfied.
At the instruction of High Park, the two defrauded investors had deposited their investment monies with Gateway. According to the lawsuit, without the investors’ knowledge, Gateway had prematurely released those investment monies before the escrow conditions were satisfied, resulting in the loss of the investment in High Park’s Ponzi scheme. The plaintiffs and their attorneys accused Gateway’s escrow officers of being aware they were committing escrow fraud and in fact were active participants in the scheme to defraud them and institutional lenders.
Edward Showalter was indicted, pleaded guilty and was sentenced for defrauding over 70 investors of over $12 million.
Read the original article in PRWeb.
May 10th, 2012 at 3:44pm
David Richard Sparks, once a talented real estate investor and former Irvine Planning Commissioner who was prosecuted for bilking his friends and family, is going to prison.
Sparks brought investors into his business by promising to buy, rehabilitate and sell foreclosed or distressed homes, something he never did (real estate investment fraud). Instead, according to evidence presented, he used the money he obtained, sometimes from life-long friends, to cover his own speculative real estate losses in Utah and forged documents, created phony escrow companies (escrow fraud) and fabricated accountings. The victims testified at his sentencing that David Sparks’ criminal conduct cost them their marriages, retirement funds, savings, credit scores and homes.
Although his plea agreement with prosecutors called for less time, Judge Cormac J. Carney added “aggravating points” when sentencing Sparks by noting he had abused his position of trust and manipulated real estate documentation and transactions. Sparks’ sentence: six and a half years in federal prison.
David Sparks was also ordered by the court to repay $4.3 million to his victims.
Read the original article in the OC Register.
April 25th, 2012 at 8:07am
Four real estate professionals in Florida and Pennsylvania are serving prison terms after pleading guilty to wire fraud by scamming elderly home owners (elder financial abuse, elder financial fraud).
Marcos Echevarria, Louis Gendason, John Incandela were loan officers with 1st Continental Mortgage who originated reverse mortgages for seniors in seven states after identifying the victims as vulnerable. Home Equity Conversion Mortgages (HECM) are insured by the Federal Housing Administration (FHA). They also purportedly altered the home’s values (appraisal fraud) in order to negotiate fake short sales (short sale fraud). The losses to the lenders, in addition to the elderly homeowners, were $2.5 million.
The fourth defendant, Kimberly Mackey, owned Real Estate One Land Services, Inc. in Pittsburgh and performed title services. She had created fraudulent HUD-1 statements to show the mortgages had been paid off, when in fact they had not (title fraud, escrow fraud).
When all four get out of prison, they will have to find a new line of work, as they have been permanently barred from doing business with the federal government.
Read the original article in Lender Hookup.
April 6th, 2012 at 8:17am
Freddy Lentz, 35, the first of six Southern California defendants in a mortgage fraud conspiracy case, has been sentenced to three years of probation after pleading guilty to accepting a $1,000 bribe. Lentz formerly worked for Bank of America.
Anthony Lewis, 39, a San Fernando Valley resident, has also pleaded guilty and is awaiting his sentence. Lewis found homes for the fraud ring to purchase and directed Maria Arriaza, 34, an escrow officer at Diamond Clear Escrow in Granada Hills, on how to disburse the ill-gotten gains.
Deon Jackson, 37, a mortgage broker from Gardena and Jennifer Le, 30, a former loan processor from the South Bay, submitted fraudulent loan applications on behalf of straw buyers.
Last but not least is Matthew Balsz, 32, a U.S. Bank employee from the South Bay. Balsz was charged with accepting bribes
The six were prosecuted by the U.S. Attorney’s Office in Los Angeles.
Read the original article in the Contra Costa Times.
