California Real Estate Fraud Report

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Archive for the 'Real Estate Crimes' Category

Benjamin Wagner Resigns as U.S. Attorney for the Eastern District of California

April 22nd, 2016 at 6:54am

One of the most prolific and successful prosecutors of mortgage fraud and real estate fraud has resigned.

Benjamin Wagner, U.S. Attorney for the Eastern District of California, said he will step down at the end of April. He will be replaced by First Assistant U.S. Attorney Phillip Talbert will become acting U.S. attorney on May 1.

Wagner, 56,  was appointed U.S. Attorney by President Obama in 2009; it is customary for U.S. attorneys to resign their posts when presidential administrations change. His district covers the region from Bakersfield to the Oregon border, areas which suffered by the housing and mortgage crisis.

Read the original article in ABC News.


Stanislaus County District Attorney’s Office Receives Federal Award

April 8th, 2016 at 10:27am

Federal prosecutors have awarded the Stanislaus County District Attorney’s Office the Outstanding Law Enforcement Agency Award for the Eastern District of California for its efforts to fight mortgage fraud and violent gangs.

In acknowledging the work of Investigator Glenn Gulley and Lt. Froilan Mariscal , U.S. Attorney Benjamin Wagner said “The investigators with the Stanislaus County District Attorney’s Office deserve particular recognition for their skill, diligence, and spirit of cooperation.”

Glenn Gulley worked on the FBI’s mortgage fraud task force and continues to work with federal investigators on several pending fraud cases, including the case against Xue Heu, a “serial investment fraudster” who posed as a government official to sell distressed properties to investors, according to federal prosecutors. Heu was sentenced to more than five years in prison. There are several articles about Xue Heu than can be found on the California Real Estate Fraud Report.

Read the original article in the Modesto Bee.

San Diego Brothers Sentenced to Prison for “Debt Elimination” Scheme, Short Sale Fraud

March 28th, 2016 at 5:53pm

Brothers and former real estate agents Adel and Atef Afkarian were sentenced to prison terms for operating a fraudulent “debt elimination” scheme as well as a complicated short sale fraud that ripped off lenders in the San Diego area.

Adel Afkarian was sentenced  to 18 months by U.S. District Judge John Houston and Atef Afkarian received 13 months. The judge ordered the brothers to pay more than $5.5 million in restitution to their victims. Their licenses had previously been revoked by the California Bureau of Real Estate.

After identifying underwater homeowners (including themselves), the Afkarians recorded fraudulent deeds (title fraud) that showed the loans on the properties had been extinguished. They then sold the properties to unaware buyers. The original mortgage lenders, who did not know about the fraudulent title documents, were not paid. This included their own $1.4 million mortgage.

At the same time, the Afkarians conspired to transact fraudulent short sales for underwater clients through a simultaneous “double escrow” scheme involving the use of straw buyers.

Read the original article in Fox 5 News.

Stiff Prison Sentence for Real Estate Agent Convicted in Mortgage Fraud Case

March 25th, 2016 at 6:11am

A Placer County woman convicted in a multimillion-dollar mortgage fraud scheme has been sentenced to 14 years in prison.

Vera Kuzmenko, 46, of Loomis was sentenced to 14 years in prison by U.S. District Judge John A. Mendez for multiple counts of mail and wire fraud, witness tampering and money laundering for her role  in the scheme that cost financial institutions more than $16 million, according to a U.S. attorney’s office news release.

Kuzmenko and  Rachel Siders, 40, of Roseville were convicted by a federal jury in December 2015. Rachel Siders will be sentenced June 21.

Prosecutors presented evidence that, from late 2006 through early 2008, Kuzmenko and Siders participants in a mortgage fraud scheme involving more than 30 properties in the Sacramento area. The pair were responsible for securing more than $30 million in residential mortgage loans on more than 30 homes purchased through straw buyers. Records introduced during the trial showed Kuzmenko received millions of dollars in payment for creating fraudulent loan applications on behalf of the straw buyers.

In October 2015, Judge Mendez sentenced co-defendants Peter Kuzmenko, 37 of West Sacramento, to 19 years in prison; Aaron New, 41 of Sacramento, to 11 years and three months in prison; Nadia Kuzmenko, 36, formerly of Loomis, to eight years in prison; and Edward Shevtsov, 52, of North Highlands, to eight years in prison. They were previously found guilty of multiple counts of mail and wire fraud associated with the mortgage fraud scheme. In addition, Peter Kuzmenko, Shevtsov and New were found guilty of money laundering associated with the scheme, and Nadia Kuzmenko was found guilty of witness tampering.

The FBI and the IRS-Criminal Investigation investigated the case.

You can find earlier articles related to this case in the California Real Estate Fraud Report.

Read the original article in the Sacramento Bee.

Lakewood Woman Convicted in Real Estate Fraud

February 26th, 2016 at 9:16am

Felicia Muhammad, 45, has been convicted on five felony counts for lying to banks that funded mortgages for three properties, according to the U.S. Attorney’s Office. Muhammad, a licensed real estate salesperson living in Long Beach, was convicted of making false statements to federally-insured financial institutions: U.S. Bank, Countrywide Bank and First Horizon Home Loans — a subsidiary of First Tennessee Bank, causing losses of $662,000 when the properties were foreclosed.

“This defendant lied to three different financial institutions, causing significant losses to all of them,” said U.S. Attorney Eileen M. Decker, in a statement. “The Department of Justice will continue to hold accountable those who would commit mortgage fraud and place U.S. financial institutions at risk.”


Read the original article in the Long Beach Press Telegram.

Operator of Excel Investments “Builder Bailout” Case Convicted

February 12th, 2016 at 11:45am

A Huntington Beach man suspected of running what authorities described as a “builder bailout” real estate scheme was convicted Friday of fraudulently buying more than 100 condominium units across the country.

Momoud Aref Abaji, 34, of Huntington Beach was found guilty by a federal grand jury of multiple felony counts of bank fraud, wire fraud and tax evasion in relation to a “builder bailout” scheme that resulted in foreclosures that caused losses of $9 million to lenders.

Prosecutors from the U.S. Attorney’s Office for the Central District of California accused Abaji and others affiliated to Excel Investments and related companies in Santa Ana and Irvine to a scheme in which they purchased struggling condominium developments from the developers in exchange for “hefty commissions.” Up to 100 condominium units were involved in these purchases, which Abaji and other defendants sold to straw buyers by utilizing altered bank statements, pay stubs and other documents.

“Abaji’s fraud cost these financial institutions millions of dollars and put taxpayer funds at risk,” said United States Attorney Eileen M. Decker.

Read the original article in the OC Register.

There is also an earlier article about Momoud Aref Abaji and Excel Investments  in the California Real Estate Fraud Report.

Newport Beach Man Convicted in Real Estate Fraud Ponzi Scheme

January 29th, 2016 at 11:42am

Thomas Franklin Tarbutton, 56, of Newport Beach, has been convicted of almost 40 felony counts, after being tried for grand theft and securities fraud. The 11 victims lost over $3 million, according to Senior Deputy District Attorney Pete Pierce of the Orange County District Attorney’s Office.

Tarbutton operated Irvine-based Villa Capital Inc. from 2004-2010 and funded private loans using monies he received from investors. He fled to Panama but was extradited to Orange County in December 2013.

Read the original article in The Patch.

Tony Huy Havens Sentenced in Separate Mortgage Fraud Schemes

January 20th, 2016 at 8:37pm

Modesto resident Tony Huy Havens, 42, was sentenced Monday by United States District Judge Lawrence J. O’Neill for his role in two mortgage fraud schemes.

The sentence of three years and five months was announced by United States Attorney Benjamin B. Wagner.

In the first case, Havens sought out individuals in at least eight states whose construction projects were in danger of foreclosing and extracted advance fees after showing them fraudulent documents indicating a lender would make them loans.

In the second scheme, Havens used two relatives as straw buyers to obtain a loan that exceeded the actual selling price of a residential property. The excess was returned to him, which he used to purchase the property.

The cases were the product of investigations by the Federal Bureau of Investigation, the Stanislaus County District Attorney’s Office, and the Federal Housing Financing Agency, Office of Inspector General.

Read the original Press Release.


Woman Arrested on Christmas Day, Charged with Real Estate Fraud

January 1st, 2016 at 12:14pm

Forty-two year-old Michele Lynne Stewart was arrested on Christmay Day and charged with over two dozen felony counts of forgery and theft, to which she pleaded not guilty.

Stewart stands accused of taking 28 fraudulent checks for a total of $240,880 from a manager of the Irvine office of  First Team from September 2011 through April 2012. She is just one of nine defendants who have already been charged but are considered fugitives. They are Brian Vancleave, Robert Morken, Jennifer Vancleave, Joe Chang, Joon Kim, Rebecca Kim, Tomy Lam, Bryce Jacot and Jimmy Lam.

Brian Vancleave ran First Team‘s risk management division for that office. He has been accused of writing 228 fraudulent checks for more than $1.4 million to friends and relatives, according to court records.

Read the original article in the OC Register.

Short sale fraud of his Florida ranch earns man a prison sentence

November 20th, 2015 at 10:12am

Jaime Olaya, 53, thought he outsmarted his bank in the short sale of his 10-acre property.

Olaya bought the property in 2005 and in 2008, quit-claimed half of it to a company he controlled. He later completed a short sale on the half that was retained in his name, selling the home to a straw buyer relative using his Olaya’s own funds from Colombia.

How he was caught remains a mystery. On top of the 2 1/2 years in federal prison he’s going to serve, he agreed to forfeit the entire property.

Read the original article in the Sun Sentinel.


© Copyright 2007-2016 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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