California Real Estate Fraud Report

Christopher Jared Warren, a former employee of Loomis Wealth Solutions, pleaded guilty in a mortgage fraud case in which he admitted stealing $7.5 million from a mortgage company through his own firm, Triduanum Financial. His business partner, Scott Edward Cavell, remains a fugitive.

Before his own initial flight from the United States, the high-rolling Warren chartered a jet from Las Vegas to Beirut, Lebanon carrying millions of dollars in gold bullion. He also left a rambling confession to his activites on his now-defunct website.

Warren was arrested when he tried to re-enter to United States from Toronto carrying a false passport and $70,000 stuffed inside his cowboy boots. Six million dollars is still missing, according to authorities.

Before starting his own firm, Christopher Warren worked for Lawrence “Lee” Loomis at Roseville-based Loomis Wealth Solutions. Although he has not been charged with a crime, Loomis, 55, is suspected of running a Ponzi scheme that caused millions of dollars to be lost by investors.

Read the original article in News10 and the Sacramento Bee.

Barry Winnett, 49, the man who operated Countour Escrow Services for co-conspirator Royce Newcomb, has been sentenced to prison for three years and two months.

Winnett, who is unlicensed and therefore ran an illegal escrow company (escrow fraud), was convicted of wire fraud for his role in Newcomb’s Ponzi scheme. Newcomb solicited money from investors to purchase foreclosed homes but in reality laundered the money through Contour Escrow Services and returned portions of it to earlier investors (real estate fraud). The sum lost to the 22 investors was nearly $3 million.

Newcomb began serving a five year two month sentence in fall 2011.

You can find earlier posts about Royce Newcomb and Barry Winnett by searching this blog.

Read the original article in the Roseville Press Tribune.

A Southern California man who prosecutors say fleeced investors out of $228 million in a real estate investment fraud, including many in Los Angeles, is fighting extradition from France, where he fled after his scheme unraveled.

Bruce Fred Friedman, 61, operated Diversified Lending Group out of swanky offices in Sherman Oaks until the Securities and Exchange Commission (SEC) shut his business down through a court order. Friedman then fled to Cannes, France.

A federal grand jury indicted Friedman on 23 charges related to what prosecutors for the U.S. attorney’s office in Los Angeles called a Ponzi scheme arising out of real estate loans (real estate fraud, real estate investment fraud). Prosecutors say that Friedman’s scheme worked because it was believable – he offered reasonable returns to his investors, many of whom moved their retirement funds into his fund.

Although the French courts have authorized his extradition, the final decision to do so is in the hands of the French government.

Read the original article in the Los Angeles Times.

Mark Alan Helsing, an Orange County-based hard money lender, has been sentenced to 15 years in state prison and three years of probation. Helsing, 53,  confessed earlier to ripping of $6.9 million from investors by operating a combined Ponzi scheme and real estate fraud scheme.

Helsing operated multiple companies: Sea View Investments, HLHS Financial Services, Inc., Foothill Realty, and Sea View Mortgage. He took investor money intended for use as hard money loans and embezzled most of the funds, using just enough to make interest payment to the investors, some of whom were his friends.

According to the OC Weekly, Helsing pleaded guilty to “55 felony counts of grand theft, seven felony counts of filing false recorded documents, six felony counts of elder financial exploitation, and sentencing enhancements for white collar crime over $500,000 and excessive taking over $1 million and $1.3 million.” He will also have to pay restitution to his victims.

Guadalupe Valencia, a 47-year old West Covina woman who pleaded guilty in 2011 to charges related to operating a real estate Ponzi scheme, has been sentenced to nine years in prison.

Valencia operated two companies in Downey called Real Estate & Loan Consultants and R.E. Equity Group, Inc. Through these firms, she solicited investors to fund two pools: one for providing short-term capital to businesses and the second for real estate loans.

The U.S. Attorney’s Office said Valencia took in $6.9 million in investor funds (real estate investment fraud) from 150 persons and made returns of approximately $1.7 million. In addition to the sentence meted out by U.S. District Judge S. James Otero, she was ordered to repay her victims $5.2 million.

Read the original article in the San Gabriel Valley Tribune.

Thanks for the FBI, a San Francisco-area man operating a Ponzi scheme has been stopped.

Maher Talal Muhawieh, 31, who was accused of defrauding 80 investors out of $25 million, has pleaded guilty to wire fraud in federal court.

According to United States Attorney Melinda Haag, Muhawieh  that he solicited investors’ monies, promising them high rates of return for properties Muhawieh would purchase, rehabilitate and sell (Ponzi scheme). In truth, he used the funds he received to pay back the earlier investors.

Read the original article in 7th Space. The press release by the United States Attorney for the Northern District of California can be read by clicking here.

Lauren Baumann, 43, a Downey woman, has pleaded guilty to one count of felony wire fraud in U.S. District Court.

Baumann solicited investors for her business called Stewardship Estates LLC, which purportedly was a “Christian” investment company. Investors were told their money would be used to promote Christian rock bands and to purchase foreclosed homes. Instead, she appropriated the investors’ $1 million for herself, rent the historic Rives Mansion in Downey, pay for private school tuition for her children and repay earlier investors – a sure sign of a Ponzi scheme.

Lauren Baumann failed to mention to her investors that she has been the subject of court action in the past, first being convicted in federal court of securities fraud in 1999 and being sued and found liable for the civil action of that same case by the Securities and Exchange Commission.

Read the original article in the Long Beach Press Telegram.

A Tustin real estate broker who specialized in hard money lending has been convicted in by prosecutors in the Orange County District Attorney’s office of over four dozen counts of grand theft, filing false recorded documents and other felonies.

Mark Alan Helsing, 53, pleaded guilty to the above charges. Helsing operated several hard money businesses, which lend money for short terms at higher interest rates than the banks. Borrowers typically either need the funds for a “bridge loan” for construction or have bad credit. The victims were investors, whose money should have been used to pay off earlier investors instead of being used to make the loans, which indicates a Ponzi scheme, real estate investment fraud and hard money fraud.

The names of Helsing’s companies were Sea View Investments, HLHS Financial Services, Inc., Foothill Realty, and Sea View Mortgage.

Read the original article in the Los Angeles Times and OC Weekly.

A Roseville man who has been sentenced to prison admitted in his plea agreement that his real estate fraud was little more than a Ponzi scheme which required the services of an escrow company to distribute the ill-gotten gains (escrow fraud).

Royce Lee Newcomb, 49, will have to serve five years and 10 months in prison for soliciting several dozen investors to give him almost $3,000,000 which he told them he was using to invest in foreclosed properties. Instead, he instructed Barry Winnett of Contour Escrow Services to disburse those monies to himself, Winnett and earlier investors. Winnett does not have a license to carry out escrow services.

Barry Winnett pleaded guilty to wire fraud in January but is still awaiting sentencing.

Read more about Royce Newcomb in the Roseville Press Tribune.