California Real Estate Fraud Report

If you’re a criminal engaged in loan modification fraud, don’t do it in Santa Clara County. The Santa Clara District Attorney’s Office will make you pay dearly for scamming people.

Amir Rashidifar, 28, and Mary Margaret Delvecchio, 30, have been convicted of two felony counts of Foreclosure Consultant Fraud. The pair were each sentenced to three years, eight months in prison and order to pay restitution of $312,450 to their 80 victims.

Rashidifar and Delvecchio operated Legal Support Services until complaints by former employees and victims were reported to and investigated by the San Jose Police Department. They were charging upfront fees of $3,100 to help people but providing no services. According to Civil Code Section 2945.4(g), they were practicing Foreclosure Consultant Fraud (loan modification fraud).

Read the press release by the Santa Clara County District Attorney’s Office.

Firing her shot across the bow, California Attorney General Kamala Harris announced today that she is creating a mortgage fraud task force to deal with the ongoing causes and effects of the financial calamity causing by irresponsible lending practices.

The task force will consist of 17 attorneys and eight special agents from the California Department of Justice and focus on these three areas:

(1) Corporate fraud in the bundling of mortgages into securities where lenders knew the securities were toxic. Harris indicated she may use the California False Claims Act to prosecute wrongdoing;

(2) Loan modification scams (foreclosure fraud), in which attorneys and so-called “foreclosure consultants” took upfront fees, promising homeowners in distress they would negotiate loan modifications but did little or nothing.

(3) Lending practices that Harris termed fraudulent in terms of how the loan product was presented to prospective borrowers (loan fraud).

What I found especially heartening, was AG Harris’ promise that “no case will be too big or too small to pursue” if the evidence to prosecute exists.

Read the full article in the Los Angeles Times.

Albert Carazolez, the owner of Quick Action Paralegal Services in Porterville, has  pleaded no contest to 21 individual charges having to do with violating the prohibition from collecting fees as a “foreclosure consultant” with respect to offering loan modification services. One or more of those charges is also for the unauthorized practice of law.

Carazolez, 49, is out on bail while awaiting sentencing of one year in County jail by the Tulare County Superior Court this May. He has also been ordered to pay restitution of $19,875 to his victims, many of whom are fellow Hispanics who trusted Carazolez.

One of Albert Carazolez’ victims is Porterville resident Joaquin Uriostegui, who paid Carazolez $1,000 in upfront costs (illegal) to help modify the loan to Uriostegui’s home. An investigator with the Tulare County District Attorney’s Office told Uriostegui that he was Carazolez’ 89th fraud victim.

For his part, Carazolez has come out swinging, threatening to sue Uriostegui and others for defamation and slander. Uriostegui is quoted in the Porterville Recorder as saying that he believes the sentence and restitution against Carazolez are insufficient.

Read the original article in the Porterville Recorder.

Four people have been charged with felonies by Ventura County prosecutors for allegedly operating a fraudulent home foreclosure rescue program from an Oxnard business called USA Home Recovery Service. USA Home Recovery Service has received a grade of “F” by the Better Business Bureau.

Maria Victoria Santos, 55, of Ventura, Felipe Carlos Segovia Castro, 67, of Moreno Valley; Laura Cecilia Carlson, 64, of Hacienda Heights; and Margie Joanna Vargas, 22, of Orange, are accused of targeting predominantly monolingual Spanish-speaking clients facing foreclosure on their homes and charging them thousands of dollars in upfront fees (mortgage rescue scams, mortgage rescue fraud, foreclosure fraud).

Laura Carlson is a licensed real estate sales agent but as of this writing shows no disciplinary action by the California Department of Real Estate (DRE).

If you believe you are a victim of these suspects, please contact the Ventura County District Attorney’s Office Real Estate Fraud Unit at 662-1750.

Read the full article in the Ventura County Star.

After several years of complaints, according to one frustrated investor, the FBI has raided the Rancho Bernardo offices of Investors Finance, Inc., owned by Michael Monaco. Investors Finance, Inc. purported to provide assistance to homeowners who were behind in their mortgages, charging them about $1,400 but allegedly failing to do so.

According to previous reports in the San Diego Tribune, Michael Monaco has had prior civil judgments for breach of contract and fraud lawsuits and as a result has been ordered to pay millions.

There is also an earlier article in the California Real Estate Fraud Report about Investors Finance, Inc. and Michael Monaco.

Read the full article in the San Diego Union Tribune.

A Salinas-area woman has been arrested by police and is charged with suspicion of mortgage fraud, embezzlement, forgery and grand theft.

Blanca Maciel Sanchez is accused of fradulently posing as a real estate agent and mortgage broker. She operated her businesses under the names of Maciel Financial Services and First Continental Mortgage. Sanchez took upfront money from at least two victims for assistance with loan modifications but their homes were foreclosed and Sanchez is thought to have spent at least some of the funds on her own bills.

Read the full article in the Salinas Californian.

Miguel Romero was once a prosperous man in the Vista area, working simultaneously as a real estate agent, insurance dealer, income tax preparer and credit repair specialist. But between 2004 and 2008, he apparently conspired with mortgage brokers to defraud both lenders and his Latino clients by convincing the latter to take out home loans, which contained overstated income statements. Almost all of the homes were eventually foreclosed.

Romero is now expected to receive a four year prison sentence this coming January after he pleaded guilty to multipe counts of fraud, theft and conspiracy according to court documents.

Not only did Miguel Romero and his co-conspirators collect $1.3 million in commissions, as part of their crimes, they took in $500,000 from some of their victims by promising to help them with their foreclosure problems.

Read the full article in the North County Times.

Two con artists who targeted Spanish-speaking and Southeast Asian homeowners in foreclosure are being arraigned today for felony fraud and theft at their Fresno-area business.

Angeline Lisa Lizarrago, 68, of Fremont and Michael Douglas Young, 67, of Los Gatos, the respective owner and general manager of Avemos Financial Group, are accused by California Attorney General Edmund G. Brown’s office of charging upfront fees to distressed homeowners in return from stopping lenders from foreclosing on their homes.  The waiting room of Avemos was adorned with figurines of the Virgin Mary, apparently used as a prop to convince the homeowners of Lizarrago’s and Young’s sincerity.

Among the victims of Lizarrago and Young were an 89-year-old man and his wife, who lost $25,000 to the pair after they promised to find them a home in Fremont but failed to do so and did not return their money.

wanted to move away from Stockton, that she owned 51 properties, many of which had been foreclosed upon, and she could find them a home in Fremont. She asked for an up-front fee, which she promised to return with interest once the purchase was made. In a series of payments, the couple gave Lizarrago $25,000. She never found them a home, nor returned their money.

The case was investigated and prosecuted jointly by the Attorney General and the Alameda County District Attorney. They were assisted in the investigation by the California Department of Real Estate and the Fremont Police Department.

Read the press release by the California Office of the Attorney General.

Randall Guerra heads a non-profit group funded by the government to help distressed homeowners in the Fresno area. He said 8 to 10 homeowners are walking in to his office each walk for help after being ripped off either by foreclosure consultants, loan modification firms or the banks.

Loan modification firms charged upfront fees (now illegal) to borrowers for assistance in negotiating loan modifications. Either the company did nothing for the borrower or took his or her money knowing that the borrower could not qualify for a loan modification.

Sydney Ricks, an attorney who heads the Real Estate Fraud Division of the Fresno County District Attorney’s Office says “There’s a lot of desperation out there and the scam artists are targeting those people knowing there is a lot of anxiety.” Yet, while there is a backload of cases to process, the unit has only one attorney and one investigator.

Read the full article on ABC.