California Real Estate Fraud Report

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Archive for the 'Loan Fraud' Category

Is There a Special Prison for Related Criminals?

October 11th, 2012 at 5:28pm

There has been more than one posting on the California Real Estate Fraud Report about real estate fraud and mortgage fraud crimes committed by familial relatives.

In this latest case, Stephen Kenneth Chrysler, 46, and his mother, Aida Agusti Castro, are going to prison for 37 months and 33 months respectivelyafter being convicted last April of multiple wire fraud charges.

Stephen Chrysler, a licensed real estate broker in Encinitas, and Castro, a licensed real estate broker in Carlsbad (I could not locate a record of her license), falsified 30 loan applications and supporting documents in order to get over $8 million in loans for buyers of 16 homes who were not only unqualified, but in many cases didn’t even understand enough English to have properly signed the documents. SKC Real Estate, Stephen Chrysler’s brokerage, “earned” $350,000 in commissions; the borrowers did not understand what they were signing and most of the properties were lost to foreclosure.

Stephen Kenneth Chrysler was also a licensed attorney in the state of California, but according to the State Bar of California, his license was given an interim suspension and he may not practice law as a result of his conviction.

Read the original article in Courthouse News.

3 in SoCal Arrested in Short Sale Fraud against Bank of America

October 11th, 2012 at 5:14pm

Finally, prosecuting short sale fraud has come to Southern California.

Three persons, including two licensed real estate agents, have been arrested after allegedly getting caught in a creative real estate fraud scheme that cost an unnamed lender $1.5 million. The investigating agencies were the Los Angeles County Sheriff’s Department Real Estate Fraud Team and the FBI.

Saliya DeSilva, 49, of Northridge, Nora Yefima, 50, of Santa Clarita and Vahe Hayrapetian, 45, of Burbank were indicted by a federal grand jury on multiple counts of wire fraud and bank fraud.

According to news wire service reports, Bank of America foreclosed on a property in the community of La Cañada Flintridge, on which the owner defaulted in July 2009. Before BofA could list the property, Sal DeSilva, then a Realtor® with USA Realty and Loans (he allowed his DRE license to expire in May 2011), posed as the homeowner and gave BofA counterfeit bank documents and convinced it the foreclosure was not valid. Bank of America then rescinded its sale. All this was unbeknownst to the true homeowner.

Here’s where the plot thickened: authorities allege that DeSilva then sold the multimillion dollar home in a short sale for $250,000 after providing the title company with counterfeit documents, included a forged short sale approval letter from Bank of America. The unnamed buyer then got a $1.5 million loan from Vahe Hayrapetian, who allegedly forged loan documents that were sent to the lender, which wired the funds to Oshana Escrow, Nora Yefima’s business in Encino. Note: Nora Yefima also holds a real estate sales person’s license and sells real estate under the brokerage of Interstate Mortgage Lenders Inc., also in Encino.

Yefima allegedly prepared false escrow documents and wire transferred a small amount of the loan proceeds to the title company and then disbursed the remaining more than $1 million to parties not related to the sale.  The “buyer” then defaulted on the loan.

Fidelity National Title Company may be stuck with having to pay the unidentified lender because Bank of America states that it never authorized the short sale, which, if the allegations are true, was fraudulent.  

Read the original article in the La Cañada Flintridge Patch and the Encino Patch.

 

US Dept. of Justice Sues Wells Fargo for Mortgage Fraud

October 9th, 2012 at 2:31pm

On behalf of taxpayers, Manhattan U.S. Attorney Preet Bharara has brought a civil action against Wells Fargo, accusing the lending giant of lying and concealing the poor quality of loans it certified for backing by the FHA. FHA loans that fail (foreclose) are the responsibility of the U.S. Department of Housing and Urban Development to reimburse the bank. In other words, there is no downside to writing a bad loan, which in this lawsuits, Bharara assets involved 6,320 mortgages.

According to the complaint that was filed in Manhattan federal district court, from January 2002 through December 2010, Wells Fargo deliberately concealed the findings of its own risk department that the FHA loans were “seriously deficient.” One of Wells’ own employee determined there was a “a dirty underbelly of bad loan officers.” The lawsuit further alleges that the bonus “incentive” plan that Wells Fargo had set up, was a prescription for disaster because it rewarded employees based on the volume of loans they produced without regard for the quality.

The purpose of FHA government-backed loans is to make home loans available to moderate and lower-income borrowers who would be able to qualify without the programs.

Citigroup, Flagstar Bank, Bank of America, Deutsche Bank and FBC have already reimbursed the FHA $1 billion after their own similar legal settlements.

Read the original article in the Huffington Post.

Tujunga Man Sentenced to Prison for Getting 4 HELOCS on the Same House

October 4th, 2012 at 2:46pm

A  man from the San Fernando Valley community of Tujunga is going to prison for more than 3 years for lying to banks in order to obtain home equity lines of credit (HELOC) on his home’s mortgage.

David Han, aka Young He Kim, pleaded guilty to four counts of bank fraud. He brazenly had filed four loan applications to four different banks on his only property.

United States District Judge Manuel L. Real ordered Han, 50, to pay $1.1 million in restitution to the victims/banks.

Read the original article in the Sacramento Bee

Linden Man Indicted for Being Straw Buyer in Mortgage Fraud

September 27th, 2012 at 7:12pm

A Linden-area man named Kory Schmidli, 34, has been indicted along with eight other people by a federal grand jury  in a local mortgage fraud scheme.

Schmidli is alleged to have acted as a straw buyer, along with friends, family and employees of brothers Volodymyr Dubinsky and Leonid Doubinski. The brother were developers who used their associates, such as Schmidli, to purchase up to 19 residential properties for them. In addition to using the straw buyers’ good credit, their financial assets were embellished in order to obtain the loans (loan fraud).

Read the original article in RecordNet.com.

Premiere One Lending Owner Sentenced, Order to Pay Restitution in $30 Million Mortgage Fraud

September 26th, 2012 at 9:24am

The owner of a Pasadena mortgage brokerage firm was sentenced to nine years in prison by U.S. District Court Judge David O. Carter for operating an ambitious mortgage fraud scheme that victimized both lenders and borrowers.

According to U.S. Attorney Andre Birotte Jr., Eduardo Ruiz, 33, and his co-defendants, sister Gilma Ruiz, 36, and 26-year-old brother Francisco Ruiz, submitted fraudulent loan applications on behalf of borrowers, many of whom did not speak English. At least 20 of the borrowers subsequently lost their homes to foreclosure, homes they never could have purchased if the applications had been submitted containing truthful information. Gilma and Francisco each received 18 month sentences, but that’s not much considering up to $30 million of the loans were fraudulent and the restitution ordered by the court against Eduardo is $5.7 million.

Eduardo Ruiz and his employees in 2005 and 2006 falsely inflated the income of more than 100 borrowers seeking home loans, officials said. Many of them did not speak English and were unaware of the fraud.

According to Leslie P. DeMarco, Special Agent in Charge of the IRS – Criminal Investigations Los Angeles Office, “Eduardo Ruiz and his cohorts knew the borrowers never had a prayer of making their mortgage payments and that many of the loans would go into foreclosure. Mortgage fraud crimes drive buyers into foreclosure, leave lenders burdened with bad loans and leave neighborhoods with abandoned and deteriorating properties.”

Read the original article in the Pasadena Star News.

Granite Bay Man Indicted in $3 Million Mortgage Fraud

September 25th, 2012 at 9:59pm

A Granite Bay man has been charged with six counts of mail fraud, wire fraud and bank fraud for lying to lending institutions in order to buy expensive homes and a World War II airplane.

According to U.S. Attorney Benjamin Wagner, Ryan William Costo, 37, submitted fraudulent loan applications (loan fraud, mortgage fraud) to CitiMortgage Inc., Washington Mutual, and Bank of America for $1.95 million, $3 million and $1.35 million respectively. The first two loans were for homes in Granite Bay and the last was for a 1945 North American P-51 D Mustang. The fraud allegedly occurred when Mr. Costo “enhanced” his assets and income and produced fraudulent tax returns and other accounting statements in order to obtain loan approval.

Read the original article in the Central Valley Business Times.

Long Beach Mortgage Sales Executive Convicted in Mortgage Fraud

September 25th, 2012 at 9:44pm

This is yet another tale of a mortgage professional who has probably ruined his life by being greedy and getting caught.

Joel Blanford, 44, worked as a sales executive at Long Beach Mortgage, the subprime lending unit of Washington Mutual (WaMu). was found guilty on September 19 of six counts of mail fraud. Blanford bribed a loan coordinator (with cash and checks!) in exchange for the coordinator falsifying loan documents and looking the other way to fraudulent loan applications. For this, Blanford earned over $1 million in sales commissions from 2003-2005.

The case is U.S. v. Blanford, 08-00269, U.S. District Court, Eastern District of California (Sacramento) and it was prosecuted by the office of U.S. Attorney Benjamin Wagner. Joel Blanford’s attorney is Michael Cardoza.

Here is an eye-popping statistic: Long Beach Mortgage was forced to buy back $875 million of its non-performing “toxic” loans from investors in 2005 and an internal audit that same year revealed that 83% (4 out of 5) of the loans the Montebello office had approved were fraudulent (loan fraud, mortgage fraud).

No wonder WaMu went bankrupt in September 2008.

Read the original article in the Businessweek.

Prison Time for Convicted Escrow Officer

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.

Former Loomis Mortgage Broker Sentenced to 14 Years for Mortgage Fraud

September 14th, 2012 at 8:51am

A former mortgage broker who pleaded guilty last January to defrauding lenders as part of the Loomis Wealth Solutions, LLC mortgage fraud case, was sentenced to serve 14 years and seven months in prison.

Christopher Warren, 30, of Sacramento entered his plea, admitting he had obtained over $12 million in fraudulent home loans by lying to the Florida-based bank.  Warren must also pay more than $19 million in restitution to his victims.

Christopher Warren was part of a group, led by Lawrence “Lee” Loomis, that ran what amounted to a Ponzi scheme, using money from new investors to re-pay the earlier ones.

There are numerous articles on Lee Loomis and Loomis Wealth Solutions on earlier postings on the California Real Estate Fraud Report.

Read the original article in the San Francisco Chronicle.

© Copyright 2007-2015 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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