California Real Estate Fraud Report

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Archive for the 'Real Estate Crimes' Category

Developer Kelly Gearhart gets 14 years in real estate fraud case

July 3rd, 2015 at 5:13am

Once honored as an Atascadero “Citizen of the Year,”  real estate developer Kelly Gearhart, 53, was sentenced to the maximum 14 years in prison for defrauding investors who lost over $15 million on his development projects.

Federal Los Angeles Judge Otis Wright imposed a harsher sentence than the government had requested for Gearhart, who pleaded guilty last year to wire fraud and money laundering. The judge noted that many were elderly investors who had lost everything due to Gearhart’s “sheer greed.”

In his plea agreement with prosecutors, Gearhart admitted selling the same lots to multiple investors doing the same to get bank financing.

Read the original story in the San Luis Obispo Tribune.

Law firm sues J. Rockcliff brokerage for kickbacks on TransactionPoint program

June 12th, 2015 at 2:09pm

La Jolla-based law firm Bottini & Bottini has filed suit against J. Rockcliff, Inc. and Jeffrey W. Sposito for violation of California Civil code 1710 (3), California Business and Prof. Code 17200, fraud and others. The plaintiffs (“Class”) hired J. Rockcliff in the purchase or sale of residences in California between July 1, 2007 and July 11, 2011 and the defendants (the agents or owners) received payments related to Fidelity National Financial‘s TransactionPoint software.

Read the complaint by clicking here.

This lawsuit comes on the heels of similar class action lawsuits against Alain Pinel and Pacific Pinnacle, also filed by Bottini & Bottini.

Fidelity has already settled charges brought by HUD having to do with the TransactionPoint program, by agreeing to pay HUD $4.5 million for alleged violations of RESPA kickbacks.

In the current lawsuit, the plaintiffs are accusing the defendants of accepting undisclosed payments from steering business to one another as real estate agents and other services without disclosing this to the plaintiffs. If true, the various complaints: breaches of fiduciary duties, fraudulent concealment, violation of California’s unfair competition law, constructive fraud and unjust enrichment, could cost the defendants to have to return their full commissions to the plaintiffs.

 

Read the original article in RE-Insider.

Woman pleads guilty in Oxnard title fraud case

June 2nd, 2015 at 9:17am

Gina Marie Hernandez, 37, has pleaded guilty to recording a false document in order to help a friend make bail.

According to the Ventura County District Attorney’s Office, recording a fraudulent document that encumbered an Oxnard residence as collateral for her friend Hayser Scarlett Lopez, 46. Lopez fled the country once she was granted bail but returned later.

Peggy Ann Soto, 55, was recruited by Hernandez to execute a phony power of attorney and to impersonate the Oxnard homeowner at Lopez’ bail hearing in Kern County Superior Court.

Read the original article in the Ventura County Star.

 

Straw buyers convicted in mortgage fraud case

May 29th, 2015 at 7:56am

A Sacramento jury has convicted six people who acted as straw buyers in the fraudulent purchase of homes located in Roseville, Sacramento and West Sacramento.

Irina Markevich, 30, of Rio Linda; Anatoliy Markevich, 35, of Sacramento; and Marina Pukhkan, 53, of Rio Linda were each convicted of two counts of wire fraud, according to a press release by the U.S. Attorney’s Office, Eastern District of California. Daniil Markevich, 38, and his wife, Svetlana Markevich, 38, both of Escondido, and Alex Markevich, 40, of Rio Linda were each convicted of one count of wire fraud.

During the 12-day trial, prosecutors presented evidence that  between February 2007 and March 2008, the straw buyers obtained home loans by submitting fraudulent loan applications and supporting documentation that also contained false information about their income, assets, bank accounts and intent to occupy the residences. The profits arose from puffing up the purchase prices and for payments  for non-existent construction work.

The defendants allowed all of the properties to go into foreclosure after making only a few payments.

 

Two plead guilty to short sale fraud in Virginia

May 28th, 2015 at 9:06am

The following is a press release from the FBI:

WASHINGTON—An Ashburn, Virginia resident was convicted today by a federal jury on 13 charges related to mortgage fraud, passing fictitious financial instruments, and tax fraud, the Department of Justice announced.

Charise Stone, 46, was indicted on April 15, 2014. According to court records and evidence at trial, Stone targeted distressed homeowners from 2007 to 2010 who owed more on their mortgage loan than the market value of the home with false promises of financial recovery. Stone acquired distressed homeowners’ properties in her own name or under entities she controlled, made false representations to mortgage lenders in order to induce approval of the short sales, and then re-sold the properties—often the same day or the next—to new buyers at a price above the short sale amount, in violation of agreements made with mortgage lenders.

Jose Marinay http://www.justice.gov/usao-edva/pr/head-annandale-settlement-company-pleads-guilty-over-2-million-short-sale-mortgage owned a settlement company that closed every short sale transaction for Stone. Marinay pleaded guilty to wire-fraud conspiracy on May 27, 2014. At his and Stone’s direction, fraudulent HUD-1 settlement statements were prepared to facilitate the transactions. Marinay destroyed some of the incriminating documents after closings. Financial institutions suffered losses of at least $2.2 million from the scheme. Stone profited more than $700,000 from these transactions but failed to file individual income tax returns. She also sent fictitious bonds to the IRS in an attempt to pay off her tax liability, and she sent fake international promissory notes to creditors purporting to satisfy her credit card debt as well as her mortgage loan.

Stone faces a maximum penalty of 20 years in prison for each of the wire fraud and wire-fraud conspiracy charges, 30 years in prison for the charges of false statements to a bank, 25 years in prison for the fictitious obligation charges, three years for the charge of corruptly impeding the internal revenue laws, and one year for each count of willful failure to file a tax return at her Aug. 14 sentencing.

Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division, U.S. Attorney Dana J. Boente, of the Eastern District of Virginia, Assistant Director in Charge Andrew G. McCabe of the FBI’S Washington Field Office and Special Agent in Charge Thomas J. Kelly, of the Internal Revenue Service -Criminal Investigation (IRS-CI) Washington, D.C. Field Office, made the announcement after the verdict was accepted by U.S. District Judge Claude M. Hilton.

This case was investigated by the FBI’s Washington Field Office and IRS-C I. Assistant U.S. Attorney Uzo Asonye and Assistant Chief Todd Ellinwood of the Tax Division are prosecuting the case.

Related court documents and information may be found on the website of the District Courthttp://www.vaed.uscourts.gov for the Eastern District of Virginia or on PACERhttps://pcl.uscourts.gov by searching for Case No. 1:14-CR-127.

Additional information about the Tax Division and its enforcement efforts may be found on the division’s website http://www.justice.gov/tax/.

New program by Solano County District Attorney to make stealing homes more difficult

May 27th, 2015 at 8:41am

The Solano County District Attorney’s Office has developed a new programr that seeks to prevent theft of a person’s home by fraudsters (title fraud).

The Real Estate Fraud Notification will electronically scan documents in the Assessor/Recorder’s Office that would transfer title in any manner, then mail a letter to the person paying the property taxes with a copy of the recorded document to alert them. If that person is unaware of the transaction resulting in the recorded document, they should contact the District Attorney’s Office.

Read the original article in The Reporter.

Tulare County DA investigator honored

May 27th, 2015 at 8:37am

The following is a press release from the U.S. Attorney’s Office for the Eastern District of California:

FRESNO — U.S. Attorney Benjamin B. Wagner announced Dwayne Johnson, an investigator with the Tulare County District Attorney’s Office, as the 2014 winner of the Eastern District of California Law Enforcement Award for Outstanding Investigator in the Fresno Division.

The award is one of four presented annually to a law enforcement agency and an officer in each of the Sacramento and Fresno divisions of the Eastern District of California to recognize outstanding collaboration between federal, state and local law enforcement in addressing public safety issues in the region.

Johnson was recognized for his work with the San Joaquin Valley Mortgage Fraud Task Force. He worked closely with the Fresno U.S. Attorney’s Office and its partner federal law enforcement agencies in leading several mortgage-fraud-related investigations and prosecutions that have targeted large-scale fraud schemes, yielded guilty pleas and vindicated the rights of countless victims.

“I am proud of the well-deserved recognition given to Investigator Johnson for showing instinct and professionalism to help bring justice to the numerous victims of this scam,” said Tulare County District Attorney Tim Ward.

In May 2013, Johnson was the lead investigator in a fraudulent foreclosure rescue business case. On the basis of a single complaint, Johnson commenced a long-term investigation that ultimately uncovered a fraud scheme that victimized dozens of homeowners in numerous counties, many of whom eventually lost their houses in foreclosure. Johnson prepared and undertook the execution of several search warrants, reviewed thousands of pages of documents, conducted dozens of witness interviews, and planned and executed various undercover operations. Juan Ramon Curiel and Santiago Palacios-Hernandez pleaded guilty in December 2014 and admitted they had caused more than $2.5 million in losses to more than 50 vulnerable homeowners and financial institutions.

“The financial crisis hit our communities particularly hard and over the past six years our office has taken a leading role in prosecuting those who engaged in mortgage fraud to enrich themselves while harming our economy and driving down the value of our neighborhoods,” said Wagner said. “Our success was only possible because of dedicated, hard-working law enforcement officers like Investigator Johnson. My office, the Eastern District, and Tulare County all owe a great debt to Investigator Johnson and his many skilled and dedicated colleagues in local law enforcement who do the heavy lifting in protecting our communities.”

Johnson is nine-year veteran of the District Attorney’s Bureau of Investigations. He has enjoyed a distinguished career in law enforcement having served with the Fresno Police Department and the FBI. He began his law-enforcement career as a correctional officer in the U.S. Army.

Man who pleaded guilty to real estate fraud charged with same offense

May 22nd, 2015 at 8:54am

A Modesto  who pleaded guilty to stealing over $1 million from investors in California and Texas has been arrested and charged with two felony counts of grand theft.

In the newest case, Xue Heu, 37, is accused of using the same tactics to scam another victim out of $6,000.

Xue Heu defies the court order and continues to defraud victims,” wrote  Glenn Gulley, an investigator with the district attorney’s real estate fraud unit in a document filed in Stanislaus Superior Court.

Read the original article in the Modesto Bee.

Fighter Chuck Liddell suing title, escrow companies in failed Vista del Hombre development

May 22nd, 2015 at 7:55am

Former fighting champion Chuck Liddell  is suing Cuesta Title Company, Stewart Title of California and Stewart Title Guaranty for the losses he suffered in the failed $24 million golf course development known as Vista del Hombre.

Liddell’s friend Kelly Gearhart, the developer of the project and a former Atascadero Citizen of the Year, is awaiting sentencing on federal fraud charges June 1. Because he filed bankruptcy, 500 of the investors are suing the title companies, claiming they were part of Gearhart’s Ponzi scheme.

Defense counsel for Cuesta Title is claiming that it knew nothing about the fraud or Ponzi scheme orchestrated by Gearhart and that it did its job as an escrow company.

Read the original article in The Tribune.

Note: there are many earlier articles about Kelly Gearhart, which you can find by searching this blog.

 

Six straw buyers convicted in mortgage fraud scheme

May 8th, 2015 at 9:44am

Six people who served as straw buyers in the Sacramento area have been convicted of wire fraud.

Three defendants: Irina Markevich, 30, of Rio Linda; Anatoliy Markevich, 35, of Sacramento; and Marina Pukhkan, 53, of Rio Linda were each convicted of two counts of wire fraud, according to a press release by the U.S. Attorney’s Office for the Eastern District of California. The three remaining defendants: Daniil Markevich, 38, and his wife, Svetlana Markevich, 38, both of Escondido, and Alex Markevich, 40, of Rio Linda were each convicted of one count of wire fraud.

All six defendants acted as straw buyers, obtaining home loans by submitting fraudulent loan applications and related financial documents. After obtaining the loans, they made the mortgage payments for a few months, then allowed the properties to go into foreclosure, causing losses to the lending institutions of more than $700,000.

Read the original article in the Sacramento Bee.

© 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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