California Real Estate Fraud Report

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Archive for May, 2011

BofA, Morgan Stanley Pay Up for Improper Foreclosures Against Military Personnel

May 27th, 2011 at 9:20am

Both Bank of America and Saxon Mortgage Services Inc., part of Morgan Stanley, are ponying up over $20 million for improperly foreclosing the properties of active duty military personnel.

Bank of America processed the foreclosures of 160 service members between January 2006 and May 2009 without obtaining court orders and without checking if the homeowners were on active duty. Many of the loans were originally underwritten by Countrywide Financial. Saxon foreclosed on 17 service members in the same fashion.

The settlements occurred after complaints were filed against the lenders with the U.S. Department of Justice, which prosecuted the case.

Read the original article in the Los Angeles Times and the press release by the US DOJ.

Elderly Encino Couple Victims of Quit-Claim and Title Fraud

May 26th, 2011 at 8:34am

Here is a tale of real estate fraud that occurred in Los Angeles:

Leonard and Elaine Skaist are in their 70s and live in Encino in a home that is paid off. In 2007, to their horror, they discovered that title documents filed with the County Recorder indicated that they had quit-claimed their home to Hamid Reisi. Further, a man named Gene Spector used the forged deed of trust to obtain a $300,000 loan against the home.

The Skaists hired an attorney to help them get their home back. Reisi denies that he filed the documents (title fraud) and quit-claimed the property back to the couple. The Skaists took both Hamid Reisi and Gene Spector to court and obtained a $120,000 judgment against them.

Read the original article in KTLA.com.

Up to $40 Million Lost in Silicon Valley Mortgage Fraud

May 25th, 2011 at 4:18pm

Two  real estate agents for Century 21 Golden Hills Real Estate have entered not guilty pleas in connection with a multimillion dollar real estate fraud and mortgage fraud case.

Norma Valdovinos and Jesus Chavez are accused of bank fraud and money laundering, among other charges. The two real estate agents are alleged to have solicited low-income buyers for properties they could not afford. The agents referred them to Linda Tran’s mortgage firms, where the buyers’ income would be falsified for the purpose of obtaining the mortgages (mortgage fraud, loan fraud).

According to the California Department of Real Estate (DRE), Norma Valdovinos still holds a valid real estate license, as does Jesus Chavez.

Read the original article in the Mercury News.

HUD Audit Accuses BofA, Wells Fargo etc. of Foreclosure Fraud

May 25th, 2011 at 3:59pm

An audit by the Inspector General for the U.S. Department of Housing and Urban Development seems to point the finger at the big 5 lenders for committing bank fraud by billing taxpayers falsely for their foreclosures.

Bank of America, JPMorgan Chase, Wells Fargo, Citigroup and Ally Financial (formerly GMAC) are accused of violating the Civil War-era False Claims Act. The False Claims Act was enacted by President Lincoln to severely penalize businesses that defraud the federal government, meaning We the Taxpayers. In this case, the audit reveals that the banks filed for federal reimbursement under TARP (Troubled Asset Relief Fund) on homes they foreclosed that sold for less than what was owed by using either doctored or defective documents.

The Department of Justice has received the findings of HUD’s Inspector General and must now decide whether to file charges against the banks.

Read the full article on Huffington Post.

Loan Processor Subpoenaed for Robosigning

May 25th, 2011 at 9:45am

California Attorney General Kamala Harris has announced that her office has subpoenaed Lender Processing Services, Inc. (LPS) after hearing testimoney from former LPS employees that they routinely signed volumes of foreclosure documents without review, a process called robosigning.

AG Harris’ investigation is part of the new Mortgage Fraud Strike Force she created this week.

Read the press release from the Office of the California Attorney General.

Roseville Sisters Charged in $9 Million Mortgage Fraud

May 25th, 2011 at 9:13am

Two sisters originally from the Soviet Union have been charged by federal prosecutors in a mortgage fraud scam that cost lenders up to $9 million.

Vera and Nadia Kuzmeko used straw buyers to purchase 20 homes in which the prices were inflated by producing fraudulent invoices to show improvement to pools, landscaping and remodeling. The sisters then split the profit from the sales.

Also charged are Aaron New, Veniamin Markevish, Edward Shevtsov, Peter Kuzmenko, Sergey Blizenko and Vanik Atoyan.

Bill Portanova, attorney for Nadia Kuzmeko, says the charges are a result of “sloppiness”.

Read the original article in KCRA.com.

H&R Block May Have to Pay for Subprime Loans

May 25th, 2011 at 8:59am

A group of mortgage bond investors is considering action to force H&R Block, Inc. to buy back many of the bad loans it wrote through its mortage company Option One.

Former H&R Block CEO Alan Bennett said that Sand Canyon Corp., had been created to take of issues related to Option One and that there were $131 million in reserves.

Read the original article in KTVU.com.

Las Vegas Man Indicted in Alameda Co. for Mortgage Rescue Fraud

May 25th, 2011 at 8:51am

A Las Vegas man has been indicted in the East Bay county of Alameda for fleecing distressed homeowners in a mortgage rescue fraud that was unbelievable but still snared customers.

Alan David Tikal’s alleged mortgage rescue scam was to promise that he could “reduce the specific debts by 75 percent” of the borrower’s mortgage using his firm KATN Trust. KATN Trust would pay off the mortgage and refinance the home at a savings of 75 percent. He charged upfront fees of anywhere from $1,000 – $2,000 for this “service.”

In the case of one borrower, Tikal recorded that the home had been paid off in Los Angeles County but the lender refused to accept the document. In another case Tikal is alleged to have not paid off the mortgage.

Tikal recruited real estate agents from several states to find his alleged victims.

Alan David Tikal has been charged with conspiring to commit real estate fraud, mortgage security fraud and filing false documents.

Read the original article on 7 On Your Side.

California AG Creates Mortgage Fraud Task Force

May 23rd, 2011 at 9:31pm

Firing her shot across the bow, California Attorney General Kamala Harris announced today that she is creating a mortgage fraud task force to deal with the ongoing causes and effects of the financial calamity causing by irresponsible lending practices.

The task force will consist of 17 attorneys and eight special agents from the California Department of Justice and focus on these three areas:

(1) Corporate fraud in the bundling of mortgages into securities where lenders knew the securities were toxic. Harris indicated she may use the California False Claims Act to prosecute wrongdoing;

(2) Loan modification scams (foreclosure fraud), in which attorneys and so-called “foreclosure consultants” took upfront fees, promising homeowners in distress they would negotiate loan modifications but did little or nothing.

(3) Lending practices that Harris termed fraudulent in terms of how the loan product was presented to prospective borrowers (loan fraud).

What I found especially heartening, was AG Harris’ promise that “no case will be too big or too small to pursue” if the evidence to prosecute exists.

Read the full article in the Los Angeles Times.

Second L.A. Building & Safety Inspector Pleads Guilty

May 23rd, 2011 at 8:49pm

Following the lead of his colleague, L.A. City Building and Safety inspector Hugo Joel Gonzalez, 49, of Eagle Rock pleaded guilty to one count of soliciting and accepting bribes. Two weeks ago, Raoul Germain, 60, of Altadena entered the same plea.

As inspectors in South Los Angeles, both men yielded power in approving or denying work performed by developers. It was the employee of one developer, tired of paying Gonzalez’ and Germain’s bribes, who became an FBI informant, turning the two well-paid inspectors into now-former L.A. City employees.

As a result of the informant’s efforts to stamp out “systemic” bribery there, the Department of Building and Safety must now respond to three subpoenas from a federal grand jury.

Read the original article in the Los Angeles Times.

© 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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