September 16th, 2016 at 9:21am
SANTA ANA, California – A Utah man has been arrested for his role in a real estate fraud scheme in which Southern California investors collectively suffered nearly $3.5 million in losses.
Shawn Patrick Watkins, 46, of Layton, Utah, was taken into custody on September 1 when he surrendered to FBI agents in Orange County. Watkins had been charged with mail fraud, wire fraud and money laundering in a nine-count indictment returned on August 17 by a federal grand jury.
Watkins and others offered investments in a company known as The Equity Growth Group (TEGG) between approximately 2007 through 2014. According to the indictment, the victims were solicited during seminars in Orange County hotels offered by Investor Workshops, Inc., in which Watkins presented himself as an expert in the field of real estate investment. In order to lend credibility to the scheme, Watkins attempted to gain trust by telling investors that he was formerly employed as a law enforcement officer.
As part of the solicitations, Watkins made omissions and false promises to investors. For example, the indictment alleges that Watkins falsely told investors that TEGG controlled hundreds of properties that generated rental income and TEGG would continue its growth by acquiring new properties. Watkins led investors to believe that they would receive substantial interest payments or that their money would be secured by collateral through the filing of deeds of trust on properties.
In reality, over the course of the several years, until the scheme collapsed in the spring of 2014, TEGG was not acquiring new properties and had a negative cash flow. Investor money was not used to acquire new properties, nor was it secured by collateral, and many victims did not receive interest payments. In fact, money that was paid to some victims as purported interest or a return on their investment came from investments made by other victims.
Read the rest of the press release from the U.S. Attorney for the Central District of California.
August 11th, 2016 at 8:42pm
Michael Llamas, 31, of Tracy, and Peter Woodard, 48, of Ventura, pleaded guilty in federal court in Sacramento to conspiracy to commit wire fraud. Llamas separately pleaded guilty to a count of concealment of a felony.
Llamas owned LW Premier Holdings LLC and Woodard owned Cobalt One LLC. They had rights to buy homes at discounts from builders in several states but purchased homes at full price without disclosing this to the lenders.
Loomis Wealth Solutions convinced investors to buy homes using their credit, which would then be rented out and managed, with the investors getting regular payments. Owner Lee Loomis was arrested in 2012 and charged with multiple counts of mail fraud and wire fraud. After pleading guilty in January 2016, he asked the court to withdraw his plea.
There are numerous articles on Lee Loomis and Loomis Wealth Solutions on earlier postings on the California Real Estate Fraud Report.
June 17th, 2016 at 9:36am
Yorba Linda chiropractor Bobby Hamby has received a sentence of four years in prison for stealing over $2 million from investors.
Hamby, 56, who pleaded guilty in 2015 to two counts of wire fraud, must also pay more than $1.2 million in restitution to his victims.
Hamby’s business was called B+E Family Investments LLC. According to prosecutors, he solicited money from his victims, promising them he would buy and improve properties and resell them at a profit. Instead, he used the victims’ monies to pay his mortgage, dues at the Yorba Linda Country Club dues, car payments, attorney fees, medical and dental bills and other personal expenses.
Read the original article in the OC Register.
May 12th, 2016 at 10:51am
Geana Or, a real estate agent from Lathrop, in San Joaquin County, has been arrested on suspicion of grand theft and elder abuse. Or, 46, who also uses the name Geana Lay.
Or / Lay will face prosecution in Santa Clara County by the Real Estate Fraud Unit with the Santa Clara County District Attorney’s Office.
Investigators found out about the alleged fraud after a 73-year-old Los Altos Hills resident reported that he was approached by his real-estate agent last year and proposed that he purchase two homes that were “supposedly approaching foreclosure” with the intent of flipping them for higher value in the future. Between January and March 2015, the agent, since identified as Or, convinced him to write 10 cashier’s checks in her name, totaling about $475,000.
Read the original article in Mercury News.
May 12th, 2016 at 10:38am
Ventura County District Attorney Gregory D. Totten announced that Gregoria Mendoza, a former mortgage broker, has pleaded guilty to multiple counts of felony grand theft and foreclosure consultant fraud.
Prosecutors said that Mendoza, 60, created six separate real estate investment schemes and stole about $470,000 from victims in Ventura, Los Angeles and Tulare counties. She had told the victims their money would be invested in real estate projects but instead she spent the money on herself.
Mendoza also illegally charged one of the victims upfront/advance fees for a mortgage loan modification.
Read the original article in the Ventura County Star.
April 29th, 2016 at 1:16pm
John Packard is a convicted felon who caught a lucky break.
Packard, 66, is the co-founder of Irvine-based Pacific Property Assets, along with his former partner, CEO Michael J. Stewart, 68. In exchange for testifying against Stewart in a case in which prosecutors alleged that about 650 mostly elderly investors lost a total of $169 million in savings and retirement funds when PPA declared bankruptcy, Packard received only 2 1/2 years, whereas Stewart was sentenced to 14 years.
Packard’s luck is that he and his ex-wife, who is serving a life sentence for contracting the murder of her wealthy boyfriend William McLaughlin, have a 16-year old daughter. U.S. District Judge Cormac J. Carney granted the lenient sentence to Packard for his cooperation and lesser culpability than Stewart.
Read the original article in the Orange County Register.
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.
March 25th, 2016 at 6:48am
The Bakersfield Investment Club, located on Stockdale Highway is under investigation by the Securities and Exchange Commission.
The SEC filed a complaint last week against the company, alleging CEO Daniel Nase of running a fraudulent scheme designed to enrich himself. Nase, a former property appraiser for Kern County, took in over $11 million from 400 people and guaranteed his investors a minimum return of 15 percent.
Los Angeles-area attorney, Scott Vick, who represents Daniel Nase, said he client ” . . . was very transparent and well-intentioned.” The SEC got it wrong. They don’t win every case they bring.”
Read the original article in BakersfieldNow.com
March 11th, 2016 at 11:46am
The former owner of a bankrupt Orange County real estate investment firm was sentenced to 168 months in prison for operating a Ponzi scheme that cost his investors $169 million.
San Clemente-based Michael J. Stewart, 68, was also ordered Monday by U.S. District Judge Cormac J. Carney to pay $9,234,914 restitution to 120 victims in connection with his conviction on 11 counts of mail fraud in August 2015.
Stewart’s firm was Pacific Property Assets. Its business, which had offices in Long Beach and Irvine, raised money by refinancing and selling properties, according to U.S. Attorney Eileen M. Decker.
Stewart and his co-defendant John Packard used new money they raised to pay earlier investors.
Read the original article in MyNewsLA.com.
February 26th, 2016 at 8:41am
Two former San Luis Obispo County mortgage brokers who were being prosecuted in a mortgage fraud case could get off easy if a California appellate court’s recommendation that they have to pay only $114,400 in restitution to their 80 victims stands, instead of the $8.2 million that they are thought to have owed to those people.
The appellate court’s alternative write of mandate ruled that the San Luis Obispo Superior Court should honor the deals it made with Rodney Virgil Jarmin, 75, and Tammy Marian Jordan, 53, former owners of Paso Robles-based Real Property Lenders.
Read the original article in the San Luis Obispo Tribune.