California Real Estate Fraud Report

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Archive for the 'Foreclosure fraud' Category

Ocwen the Target Again of New York Banking Supervisor

October 28th, 2014 at 11:02am

New York’s top banking supervisor once again set his sights on Ocwen Financial Corp. this week, saying the servicer sent thousands of foreclosure warnings to borrowers months after it was too late to save their homes.

Benjamin Lawsky, New York’s superintendent for financial services, said an investigation of Ocwen’s mortgage servicing practices turned up more than 7,000 letters sent to borrowers that had been backdated and sent only after their payment deadlines had passed.

“In many cases, borrowers received a letter denying a mortgage loan modification, and the letter that was dated more than 30 days prior to the date that Ocwen mailed the letter. These borrowers were given 30 days from the date of the denial letter to appeal that denial, but those 30 days had already elapsed by the time they received the backdated letter,” Lawsky said in a letter, which was addressed to executives and board directors at Ocwen.

Note: it is my observation and opinion as a Realtor® that Ocwen is at the top of the list of servicers that are inept and fail in their fiduciary obligations to homeowners, such as paying impounds and insurance declarations as they are legally required. God help anyone who is forced to have Ocwen servicing their loan.

Read the original article in DSNews.

An update on the same topic:

According to an article in National Mortgage News, Ocwen’s problems may prevent it from completing its purchase of $39 billion in mortgage-servicing rights from Wells Fargo. Analysts and servicing experts say Benjamin Lawsky’s investigation of Ocwen may have delivered the “death blow” to the deal.

“This increases the chances the Wells Fargo servicing deal is canceled,” Compass Point Research & Trading analyst Kevin Barker wrote in a research note.

Lawsky’s crackdown on Ocwen sent the mortgage servicer’s shares down 18.2% last Tuesday and another 7% in Wednesday afternoon trading.

 

Jewel Hinkles and Others Sentenced for Loan Modification Fraud

September 30th, 2014 at 10:32am

Four people have been sentenced to federal prison for scheming to victimizing homeowners in foreclosure.

U.S. District Judge William B. Shubb  sentenced Jesse Wheeler, 37, of Roseville to three years; Jewel Hinkles, aka Cydney Sanchez, 64, of Los Angeles to five years; Cynthia Corn, 61, of Oakland to two and a half years; and Brent Medearis, 48, of Modesto to one year and 10 months in prison.

Evidence presented by the U.S. Attorney for the Eastern District of California showed that Jewel Hinkles was the founder and general manager of Horizon Property Holdings LLC in Beverly Hills. From 2008 through 2010, she offered programs called “Save My Home” or “Homesaver” that promised homeowners she would save their homes and reduce the principal on their mortgages (loan modifications scams).

Jesse Wheeler was one of Hinkles’ affiliates and his Roseville-based company, J.W. Financial Solutions, took in approximately $2,133,376 from more than 600 victims.

Prosecutors said the defendants promised the homeowners they would buy the homeowners’ mortgages at a discount in order to reduce the principal and monthly payments. To effect this, the defendants filed fraudulent deeds (title fraud) transferring an interest in the homeowner’s property to a fictitious entity called Pacifica Group 49/II.

The case was prosecuted by Assistant U.S. Attorney Lee S. Bickley and Matthew D. Segal.

Read the original article in the Merced Sun-Star.

Flagstar Penalized $37.5 Million for Violating Mortgage Servicing Rules

September 30th, 2014 at 7:49am

Banks that continue using stall tactics to prevent borrowers from refinancing their homes or getting loan modifications are now finding their dishonesty is very costly. The Consumer Financial Protection Bureau has just fined Michigan-based Flagstar  $37.5 million for violating the new mortgage servicing rules.

Read the article in DSNews.

Owner of Head Financial Service Get 35 YEARS in Prison

September 12th, 2014 at 11:15am

Charles Head, 40, the former CEO of Head Financial Services, Creative Loans and other brokerage and financial companies, was sentenced by U.S. District Judge Kimberly J. Mueller to 35 years in prison for operating foreclosure rescue scams.

Instead of helping homeowners who came to him for help in avoiding foreclosure of their homes, Head substituted straw buyers on the victims’ property titles without their knowledge (title fraud). straw buyers then applied for mortgages and sucked out whatever equity existed. The victims lost their homes and suffered damage to their credit ratings.

According to prosecutors, Charles Head‘s foreclosure fraud began in Los Angeles and Orange Counties and then expanded to a nationwide operation. In all, he and his co-conspirators obtained over $90 million in loans, caused losses of over $50 million and stole the title to more than 300 homes. He was caught only because one of his victims in Sacramento contacted an FBI economic crimes agent on a complaint line.

Read the original article in the Sacramento Bee.

Garden Grove Man Charged with Operating Fraudulent Loan Modification Company

August 15th, 2014 at 10:56am

Duy Khac Nguyen, 34, Garden Grove, has been charged with 37 felony counts of grand theft, five felony counts of theft from elder, including a sentencing enhancement for property loss over $65,000. The charges involve 42 alleged victims and $92,000 of their money in a loan modification fraud case.

The scheme Nguyen is alleged to have run operated only between February and July 2010. His loan modification company was called HAMP Resources, which he is accused of claiming falsely of having an association with the federal government’s HAMP program. Instead of offering loan modification services, prosecutors allege that Nguyen deposited the money from homeowners into his personal bank account and then moving out of the area.

He was apprehended  by the Riverside County Sheriff’s Department with assistance from the Garden Grove Police Department after United States Postal Inspection Service (USPIS) received complaints. USPIS along with the Special Inspector General for the Troubled Asset Relief Program (SIG-TARP) conducted the investigation.

“Nguyen is charged on 42 counts with swindling struggling homeowners, including the elderly, by falsely claiming that his company ‘HAMP Resources’ was part of the federal government,” said Christy Romero, Special Inspector General for SIGTARP. “He allegedly sold a money-backed guaranteed service to lower homeowners’ mortgage payments and interest rates under TARP’s housing program known as HAMP. He is alleged to have taken the money from his victims, without providing any service, then disconnecting his phone and shutting down his mailbox, website, and bank account while some of his victims lost their homes to foreclosure. SIGTARP and our law enforcement partners will aggressively investigate allegations of crime related to TARP.”

Loan modification scams are proliferating at a rapid pace,” said B. Bernard Ferguson, Inspector in Charge of the USPIS – Los Angeles Division. “The U.S. Postal Inspection Service is continuing to investigate and will pursue such criminal activity when the nation’s mail system is used for illegal or dangerous use.”

Senior Deputy District Attorney Pete Pierce of the Orange County District Attorney’s Major Fraud Unit is prosecuting this case.

Read the Press Release for this case.

Guilty Pleas in Santa Barbara County Loan Modification Prosecution

August 15th, 2014 at 10:39am

Santa Barbara County District Attorney Joyce E. Dudley announced guilty pleas in a case where the defendants promised to obtain loan modifications for struggling homeowners.

Ismael Cancinos, age 56, of Palmdale, CA pleaded guilty to 34 felony counts that included charges of first degree residential burglary, grand theft and fraudulent practices of a foreclosure consultant. Mercedes Alvarez, age 48 of Palmdale, CA, pleaded guilty to 7 felony charges that included fraudulent practices of a foreclosure consultant. She also admitted the special allegation of committing an aggravated white collar crime. They were ordered to pay full restitution to their victims and Mercedes Alvarez has been ordered to surrender her real estate license.

Read the original article in Santa Barbar Edhat.

Three People Charged in SoCal Short Sale Fraud Case

August 15th, 2014 at 10:28am

A common short sale scheme with a twist may land three people in a lot of trouble.

Prosecutors said Nelly Luz Rubiano, 57, of Ojai, and Orange County residents Sergio Sanchez Santibanez, 32, and Alejandra Rodriguez, 31, allegedly operated a foreclosure rescue program that may have incorporated short sale fraud into the business model.

The three worked for Foreclosure Legal Services in the city of Orange and were arrested on allegations they charged homeowners in distress upfront fees, which are illegal in California. They were alleged to have promised the homeowners to save their homes by offering to buy the homes in a short sale and then re-selling the properties to those homeowners at a discounted market value, courtesy of the lenders.

Prosecutors said that from 2011 to 2012, Rubiano, Santibanez and Rodriguez lured struggling homeowners in Ventura County with a promise to save their homes that were undergoing foreclosure. The three allegedly promised to buy the distressed properties in a short sale and said they would then sell the properties back to the homeowners at a reduced market value, prosecutors said.

Read the original article in the Ventura County Star.

“Keeping My Property” Owner Charged with Defrauding Contra Costa Homeowners

June 20th, 2014 at 8:37am

Marc Stanley Cooper, 60, has been charged by the Contra Costa District Attorney’s Office with 21 counts of elder financial abuse, foreclosure fraud and grand theft.

Prosecutors said Cooper solicited homeowners in distress for money to negotiate a reduction in their mortgages but did not do so, instead defrauding the 15 homeowners.

“He is an experienced con man who promised individuals who were suffering with overly large mortgages that he could reduce their mortgages as well as modify their loans,” said Deputy District Attorney Ken McCormick, of the District Attorney’s real estate fraud unit. “In reality, he was embezzling and defrauding them.”

Read the original article in the Mercury News.

Wells Fargo “Smoking Gun” Foreclosure Manual Going on Trial

May 9th, 2014 at 7:38am

A plaintiff suing Wells Fargo has achieved an important pre-trial ruling that could affect other homeowners seeking to sue the banking behemoth for how it treats its borrowers in foreclosure.

U.S. Judge Allan Gropper of New York ruled that Wells Fargo’s Home Mortgage Foreclosure Attorney Procedure Manual will be allowed into court after attorney Linda Tirelli argued the 150-page manual was relevant to the bankruptcy case of Mota v. Wells Fargo because the bank was using the manual to “falsely create evidence of ownership” in the note. Just as interesting, the manual allegedly instructs the bank’s attorneys on how to proceed with a foreclosure, even when the bank is missing critical documents.

“(Wells Fargo) can no longer deny having procedures for endorsing notes or provide witnesses who lack knowledge about the procedures, which is what they have consistently done in the past,” Tirelli told HousingWire on Monday. “The procedure manual is raising a lot of eyebrows and rightfully so. I attended the National Association of Consumer Bankruptcy Attorneys convention April 11-13 … during which I spoke with many consumer attorneys from across the country who have run into the same problem of witnesses being provided by Wells Fargo who simply lack knowledge of the process or deny there is a process for obtaining endorsements on notes and creating assignments or affidavits of lost note.”

In a different bankruptcy case – Cynthia Franklin v. Wells Fargo – Tirelli has filed a motion to re-open discovery post-trial because she only discovered the foreclosure manual just after the trial.

Read the original article in HousingWire.

Three Men Convicted of Operating Fraudulent Mortgage Rescue Service

December 5th, 2013 at 8:45pm

Three Southern California men have been found guilty of conspiracy to commit mail fraud by a federal jury. The case was tried by the office of U.S. Attorney Benjamin Wagner.

Charles Head, 36; Benjamin Budoff, 46; and Domonic McCarns, 39, were accused by prosecutors of operating a large-scale foreclosure rescue scam. Head was convicted of three additional charges of mail fraud.

Prosecutors presented evidence that Charles Head led the scam under the entities Head Financial Services and Creative Loans. The firms operated from Orange County between March 2005 and June 2006 and received more than $5.7 million from distressed homeowners by promising them they could save their homes.

Read the original article in the Central Valley Business Times to learn how the foreclosure rescue scam operated.

© Copyright 2007-2014 Monique Bryher

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The information and notices contained on The California Real Estate Fraud Report are intended to summarize recent developments in real estate fraud, mortgage fraud, short sale fraud, REO fraud, appraisal fraud, loan modification scams, loan modification fraud and other real estate related crimes occurring in Los Angeles and California. The posts on this site are presented as general research and information and are expressly not intended, and should not be regarded, as legal advice. Much of the information on this site concerns allegations made in civil lawsuits and in criminal indictments. All persons are presumed innocent until convicted of a crime. Readers who have particular questions about real estate fraud, mortgage fraud and appraisal fraud matters or who believe they require legal counsel should seek the advice of an attorney.

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