California Real Estate Fraud Report

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Archive for the 'Loan Fraud' Category

Defendants in Real Estate Fraud Get a Break after Judge Tosses Charges

November 8th, 2013 at 9:33am

A case in which lenders were defrauded of $15.2 million went south when the presiding judge threw out most of the charges because the district attorney filed her case too late.

Fresno County Superior Court Judge Jonathan Conklin noted that the office of Fresno County District Attorney Elizabeth A. Egan had missed the four-year statute of limitations by filing almost one month too late. This resulted in 100 of 140 charges against the defendants being dismissed. There are now just four defendants facing 13 charges; eight of the defendants have no charges remaining against them. They are Paul Isaac Ramirez, Lisa Sanchez, Johnny Marcos Sanchez, and Lorenzo Lopez.

The original complaint accused 12 people of fraudulently obtaining loans to buy 19 homes in Fresno, Clovis, Sanger and Bakersfield between July 2005 and December 2006. The mortgage fraud originally came to authorities’ attention when Henry Milton, the owner of Worldwide First Mortgage, noticed irregularities with the loans and filed a consumer complaint with the Fresno County District Attorney’s Office.

Read the original article in the Fresno Bee.

Crisp & Cole Mortgage Fraud Case Wrapping up with Pleas

November 8th, 2013 at 8:42am

Carl Cole, one of the principals in the Bakersfield firm of Crisp & Cole, is about to enter a guilty plea in the case against him and 14 other defendants in which lenders were defrauded out of millions.

Cole will plead guilty to conspiracy to commit mail fraud, wire fraud and bank fraud. In addition, he will be serving at least eight years in prison and turn over close to $30 million, which he admitted obtaining as a result of the criminal scheme of which he and others were accused.

Pleas were also announced by the U.S. Attorney’s Office for Caleb Lee Cole (Carl Cole’s son), real estate agent Sneha Ramesh Mohammadi, and unlicensed loan officer Jayson Peter Costa.

Julie Farmer, Jeriel Salinas, Michael Munoz and Jennifer Crisp have trial dates in 2014.

Those who have already pleaded guilty are real estate agent Robinson Dinh Nguyen, accountant Kevin Sluga, loan officer Jerald Teixeira, loan officer Christopher Stovall, Megan Balod and Leslie Sluga.

Read the original article in Bakersfield Now.

There are many articles going into more depth about the Crisp and Cole case that can be found be using the search bar in this blog.

Woman Who Operated $100 Million Mortgage Fraud Sentenced to Prison

October 4th, 2013 at 11:26am

The numbers keep getting bigger and bigger.

Mary Armstrong, 52, of Las Vegas has been sentenced in San Diego to nearly 8½ years in federal prison after pleading guilty for masterminding a $100 million mortgage fraud scheme.

My calculator tells me that Armstrong will leave prison a wealthy woman, as the court ordered her to pay only $500,000 to her victims, according to the U.S. Attorney’s Office.

Armstrong, whose boyfriend William Fountain received a 3 1/2 year sentence, was the brains behind a scheme in which straw buyers were recruited to buy homes for inflated prices. The six conspirators divided approximately $15 million for their efforts.

Read the original article in The Republic.

Three Officers from California City Break Up Real Estate Fraud Ring

October 4th, 2013 at 10:57am

Three police officers with more tenacity and hard work than money pulled off busting a real estate fraud ring that involved identity theft and losses of over $1 million.

The California City Police Department has a staff of less than 20. But when Reserve Officers Michael Katz and Chris Christopher (now deceased), and Sgt. Jeff Takeda heard about a case in November 2008 in which an identity theft in Anaheim was used to purchase property in California City, they went to work.

According to Officer Katz, the defendants, who built six houses, did so “in a plummeting market, a market with no buyers. The (suspects) used a combination of what’s called straw buyers and identity theft victims to sell the houses to.” The builders found a cooperating appraiser, who “super-inflated” the valuation for the houses, giving the defendants excess proceeds to skim. The true values were less than half of the appraised amount, which the banks found out during their investigations.

The defendants are appraiser Nathaniel Acree, 65, of Long Beach; broker Jay Langer, 51, of San Juan Capistrano; Khalid Malik Abdul Ali, 60, of California City; Angie Cachu, 44, of Orange; and notary Elizabeth Torres, 28, of Santa Ana. All of them are in custody except Torres and Angie Cachu, whose whereabouts are unknown.

Referring to the three officers, Kern County Deputy District Attorney Gordon Isen noted, “They did an excellent job investigating the case and drafting the report.” Isen is prosecuting the case.

Read the original article in the Bakersfield Californian.

Elk Grove Attorney in Hoda Samuel Case Sentenced to Prison

September 27th, 2013 at 4:07am

An attorney from Elk Grove who pleaded guilty to intentionally verifying inflated income statements made by borrowers to induce lenders to underwrite loans is going to federal prison for 2 1/2 years. His guilty pleas were to conspiracy and make false statements.

Sean Patrick Gjerde, 37, worked for Hoda Samuel, the owner/operator of Liberty Real Estate & Investment Company  and Liberty Mortgage Company. Samuel stood trial, was convicted and received a 10-year sentence in the mortgage fraud case.

Eight other persons have been charged in this case; seven have already pleaded guilty and await their fates . . .

Unrelated to this prosecution is an action by the California State Bar Court in April, 2012, which placed Sean Gjerde on inactive status because of pending cases alleging misconduct on his part.

Federal prosecutors have charged eight others in the mortgage fraud scheme. Seven have entered guilty pleas and await sentencing.

There are a number of postings on the California Real Estate Fraud Report regarding the prosecution of Hoda Samuel that you can find by using the search tool.

Read the original article in News10 ABC.

Santa Paula Man Indicted in Mortgage Fraud That Allegedly Targeted Latino Community

September 27th, 2013 at 3:54am

An investigation into a mortgage fraud conspiracy that is alleged to have targeted both Spanish-speaking persons (affinity fraud, ethnic fraud) and lenders has resulted in the arrest of eight people by the FBI, seven of whom are Ventura County residents.

Just arrested is Cesar Rodriguez Azamar, 36, of Santa Paula. The scheme was led allegedly by Jose “Joe” Garcia, 36, of Camarillo via Oxnard-based New Concepts Home Loans. Jose Garcia is a broker who also owned Century 21 Premier Realty, which still has a license to operate by the Bureau of Real Estate.

Besides Cesar Azamar and Joe Garcia, the others indicted are Lucy Ann Garcia, 46, (wife of Joe Garcia), Fernando Murguia, 47, of Oxnard; Jose Garcia’s sister, Sesilia Garcia, 30, of Oxnard; Lili Ayala Hernandez, 41, of Oxnard; Gregg Scott Quinn, 40, of Camarillo; and Lidubina “Lido” Mendoza Perez, 41, of Moreno Valley, who worked at New Concepts Home Loans office in  Bakersfield.

According to the indictment, New Concepts employees allegedly prepared mortgage applications that contained false information about borrowers’ income, employment and assets.

Ventura County Chief Deputy District Attorney Miles Weiss said fraudulent loans were written “for more than 100 homes, a conservative safe number,” and losses to the lender exceeded $11 million.

FBI Assistant Director in Charge Bill L. Lewis said that Joe Garcia “allegedly directed his workforce, including unlicensed individuals acting as Realtors, to peddle the dream of home ownership in the poorest neighborhoods of Oxnard, where they easily found people eager to buy.” If this is true, it could be concluded that the defendants used non-licensees because they knew that their victims would be unaware that a license is required to sell real estate in California.

The victim-banks were Washington Mutual, Wells Fargo, Countrywide, IndyMac, SunTrust, World Savings Bank and JPMorgan Chase.

Read the original article in the Santa Paula Times.

U.S. Attorney’s Lawsuit against Bank of America Goes to Trial in New York

September 25th, 2013 at 9:54am

Attorneys for the U.S. Attorney’s Office in Manhattan are squaring off against Bank of America’s lawyers in a massive lawsuit in which the banking behemoth’s Countrywide predecessor is accused of underwriting and selling toxic mortgages to Fannie Mae and Freddie Mac.

Pierre Armand is an attorney in the civil division of the U.S. Attorney’s Office in Manhattan. Armand calls Countrywide’s business model one in which quality suffered under profiteering and which resulted in massive fraud that cost the two former government-sponsored entities dearly while making Countryside $165 million selling the loans.

“Hustle was not about quality,” Armand said. “It was about speed. It was about volume. It was about profits.”

Countrywide’s loan program, implemented in 2007, went under various names: the “High Speed Swim Lane,”  “HSSL” or “Hustle.” HSSL was overseen by Rebecca Mairone, a former chief operating officer of Countrywide’s Full Spectrum Lending division. Mairone is a co-defendant in the lawsuit who currently works at JPMorgan Chase & Co. and is being defended by Bracewell & Giuliani.

The government’s lawsuit was filed under the Financial Institutions Reform, Recovery, and Enforcement Act, which was passed following savings-and-loan frauds and scandals that occurred during the early 1980s. It blames Countrywide (now Bank of America) for the losses borne by Fannie Mae and Freddie Mac on thousands of supposedly prime mortgages that later defaulted, causing losses of $131 million to Fannie Mae and Freddie Mac.

Bank of America’s attorney is Brendan Sullivan, who countered that Countrywide had quality control in place as well as systems to prevent fraud. “No fraud,” he said. “Two words. That’s the heart and soul and body of the defense. No fraud. And that’s what the evidence will show.”

The case is U.S. ex rel. O’Donnell v. Bank of America Corp et al, U.S. District Court, Southern District of New York, No. 12-01422. It is being heard in front of U.S. District Judge Jed Rakoff.

Read the original article in the Chicago Tribune.

Los Angeles Broker Pleads Guilty in Theft of Escrow Funds

September 25th, 2013 at 8:23am

Steve Kessedjian, 50, from the Los Angeles community of Tarzana, pleaded guilty in Fresno U.S. District Court to committing mail fraud.

According to the plea agreement he signed, Kessedjian used his two businesses Amerilend and Targa Escrow to defraud his clients of funds they were due from escrow (escrow fraud).

In December 2007, a Tuolumne County couple used Amerilend to apply for a loan to refinance their home and pay their credit card debt. The HUD-1 settlement statement would normally have instructions to the escrow officer to, in this case, pay off the credit cards. But Kessedjian instead modified the HUD-1 so that no funds were allocated by Targa Escrow to the pay-off; instead, he used the money for himself. Six months later, he wrote checks to repay those escrow funds but they bounced.

Sadly, Steve Kessedjian’s crimes, which he admitted in his plea agreement, caused the couple to have to file bankruptcy. The plea agreement also requires Kessedjian to repay the victims over $66,000.

U.S. District Judge Lawrence O’Neill will sentence Kessedjian in December, at which time the could get up to 20 years in federal prison and a fine of $250,000.

The Bureau of Real Estate revoked Steve Kessedjian’s broker’s license.

Read the original article in the Central Valley Business Times.

$100 Million Mortgage Fraud Costs Laguna Hills Man Only One Year of Prison Time

September 18th, 2013 at 4:27pm

The OC Weekly blog reports that John Allen, an unlicensed mortgage loan processor from Laguna Hills, was sentenced to one year in federal prison for his role in a $100 million mortgage fraud scam.

Allen pleaded guilty earlier to wire fraud, money laundering and conspiracy and was sentenced on September 16 in San Diego.

Four other people were sentenced for their roles in the same mortgage fraud, which entailed recruiting straw buyers, creating phony loan and other supporting financial documents in order to obtain mortgages. Most of the properties were later foreclosed, but only after the conspirators “earned” $15 million due to their crimes.

One year in prison in exchange for a piece of $15 million. Some might consider that a cost-effective crime.

The original indictments were reported in 2012 in the California Real Estate Fraud Report.

Bakersfield Man Gets 10-Year Sentence for Mortgage Fraud

September 18th, 2013 at 4:07pm

Eric Ray Hernandez, 37, of Bakersfield, has been sentenced to federal prison for 10 years and 10 months after admitting the role he played in a mortgage fraud that cost lenders over $6 million.

U.S. Attorney Benjamin Wagner of the Eastern District of California said that Hernandez and others conspired to submit loan applications and supporting financial documentation to lenders containing false information (loan fraud, mortgage fraud). The results of his efforts led lenders to underwrite the loans causing the losses.

The judge, United States District Judge Anthony W. Ishii, ordered Eric Ray Hernandez to pay restitution of $6,087,541 to the victims of his crimes along with a forfeiture judgment of $6,037,541 to the United States.

The original information can be found in the press release for the US Attorney’s Office.

 

© Copyright 2007-2017 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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