California Real Estate Fraud Report

You have just entered the #1 private-sector resource on the Internet for real estate fraud. In doing so, you have voluntarily left the dimension of the conventional real estate world and crossed over to the Dark Side, the realm where greed, dishonesty and evil are the order of the day. Sign up for a free subscription to this comprehensive news resource and receive weekly, timely news reports about real estate fraud, mortgage fraud, short sale fraud, REO fraud, title fraud, loan fraud, appraisal fraud, affinity fraud, loan modification scams, securities fraud and elder financial fraud.

Hemet Man Goes to State Prison for Novel Ponzi Scheme

August 22nd, 2013 at 10:34am

A 56-year old Hemet man who concocted a novel and elaborate Ponzi scheme that defrauded his investors of more than $12 million has been sentenced to 15 years in state prison and order to pay full restitution to his victims.

Ralph John Solis pleaded guilty to four counts of grand theft and operating a business for the purpose of committing securities fraud. The 15 years includes a sentencing enhancement for committing an aggravated white-collar crime.

Solis’ scheme was to find mortgages held either by private parties, e.g., relatives, or non-mainstream lenders, getting copies of the deeds of trust and adding his name as the beneficiary (title fraud). The phony deeds of trust were then sold to unsuspecting buyers and included first, as well as junior, liens.

The victims resided in all Southern California counties in addition to Texas and Arkansas. In keeping with the Ponzi scheme mentality, Ralph Solis spent the money on himself.

Read the original article in the Los Angeles Times.

AB 381 to Protect Seniors signed by Governor Brown

August 17th, 2013 at 12:05pm

California Governor Jerry Brown has signed Assembly Bill 381 into law, which will provide greater protection to the elderly who are ripped off.

Prior to the enactment of AB 381, double damages could be awarded to seniors who became victims to professionals, relatives, “friends” and acquaintance who committed elder financial abuse the misappropriating, embezzling, stealing or misusing the power of attorney. Yet even that was no always enough to recoup the costs to sue and recover whatever the value of what was stolen.

Now the victim or his/her representative will be able to recover their attorney’s fees and other legal costs if the lawsuit is successful.

Assemblyman Ed Chau was the author of AB 381. In a recent press release, Assemblyman Chau said “Each year in California, elder and dependent adults are devastated by the loss of property taken from them through financial scams. This bill makes certain that seniors who are victims of financial elder abuse will no longer have to worry about the cost of seeking justice.”

I hope this bill also acts as a deterrent to those criminals who contemplate elder financial fraud against a vulnerable person.

Read the original article in the Sacramento Business Journal.

Elk Grove Real Estate Broker Sentenced to 10 Years for Mortgage Fraud

August 16th, 2013 at 9:20am

Hoda Samuel, a California licensed real estate broker, was sentenced today to 10 years in prison in Sacramento federal court for operating a mortgage fraud scheme that caused the victims/lenders over $5.5 million in losses.

U.S. Attorney Benjamin B. Wagner made the announcement and said the following in a press release:

“Taking fraudsters out of the residential real estate industry and sending them to prison has been one of this office’s top priorities. Today’s sentence is another success in our fight against the mortgage fraud schemes perpetrated by Hoda Samuel and her co-defendants that wreaked havoc in this region.”

Comments by other law enforcement officials regarding Samuels’ crimes are below:

“Greed-based crimes such as these can undermine the stability of our financial institutions and the economy, resulting in devastating consequences for homeowners, businesses, and communities in which the properties are located,” said Special Agent in Charge Monica M. Miller of the Sacramento Division of the FBI. “The FBI continues to be committed to identifying and investigating mortgage fraud schemes, such as those committed by Hoda Samuel and her associates.”

“Today’s sentencing of Ms. Samuel is a warning to those who abuse their position of trust to unjustly enrich themselves, the consequences can be severe,” said José M. Martínez, Special Agent in Charge, IRS-Criminal Investigation. “Mortgage fraud has hurt so many people and so many of our communities. This sentencing highlights the ongoing commitment of IRS-CI to hold accountable those involved in these types of crimes.”

At trial, evidence was presented by prosecutors Assistant U.S. Attorneys Philip A. Ferrari and Todd A. Pickles that Samuel, 62, owned and operated real estate agency Liberty Real Estate & Investment Company and Liberty Mortgage Company. The prosecutors showed that between April 5, 2006 and February 26, 2007 there were 30 real estate transactions for which Samuel was the real estate agent for the buyer in 29 of the home sales and also represented the seller in 15 of those sales (dual agency). Income statements for the borrowers were falsified in order to convince the lenders that said borrowers were qualified to make the home purchases (loan fraud, mortgage fraud). As a result, all of the properties were foreclosed eventually.

Read the original article in Mortgage Daily.

New Citizen Who Defrauded Marin County Realtor® Pleads Out

August 16th, 2013 at 9:04am

A Marin County Realtor® and his girlfriend who were defrauded out of $1.6 million by a man claiming to be the son of the president of the Democratic Republic of the Congo are receiving a measure of justice.

Blessed Marvelous Herve, the ersatz royalty, was orginally supposed to appear before Judge Jon S. Tigar in San Francisco federal court last week on wire fraud charges. Instead, Ethan Balogh, Herve’s attorney, and Assistant U.S. Attorney Hallie Hoffman were able to inform the court that the prosecution had presented an agreement that is acceptable to Herve, according to court documents.

According to U.S. Attorney Melinda Haag, Herve could have received up to 20 years in prison if he had been convicted. Thus far, the terms of the plea agreement have not been released.

Herve originally contacted the real estate agent, identified only by the initials “BE” in court documents, in response to an ad the agent had run for a property. The FBI alleged in court documents that Herve defrauded “BE” and his girlfriend out $1.6 million using a variation of the “Nigerian Prince scheme,” in which the criminal pretends he has a relationship to a wealthy foreigner in order to defraud the victim.

Herve only became a U.S. citizen in March 2013 but was arrested just one month later on the wire fraud charges, which date back to the origin of the scheme in 2005.

There is an earlier article about Blessed Marvelous Herve and his victims that you can be directed to by clicking on the link California Real Estate Fraud Report.

Read the original article in the Mill Valley Herald.

Owner of eLender Escrow Pleads Guilty to Running Ponzi Scheme

August 15th, 2013 at 5:22pm

An Orange County man who was accused by the U.S. Attorney’s Office of running an unlicensed escrow company that diverted loans to himself (escrow fraud) and to operating a Ponzi scheme has admitted his crimes and pleaded guilty.

Russell Samuel Biszantz stood before U.S. District Court Judge David O. Carter and along with the guilty plea, agreed to provide restitution to the victims in answer to the judge’s question.  Assistant United States Attorney Greg Staples said the Ponzi scheme caused losses of over $2.44 million from the victims and that Biszantz, the owner of eLender Escrow, Inc. of Lake Forest, had continued to operate his business after losing his license in 2008.

Sentencing for Russell Biszantz is set for December 2013.

Read the original article in the OCWeekly.

Former Michigan Supreme Court Justice Diane Hathaway Begins to Serve Sentence for Short Sale Fraud

August 14th, 2013 at 4:04pm

The bigger they are . . .

Former Michigan Supreme Court Justice Diane Hathaway, who pleaded guilty in January 2013 to one count of felony bank fraud, has begun serving her one-year, one-day sentence for committing short sale fraud.

According to Wikipedia, Justice Hathaway “was the first sitting Michigan Supreme Court Justice to be charged with a crime in nearly 40 years.”

Hathaway, 59, resigned her esteemed position from the bench eight days after entering her plea, is now an inmate at “Camp Cupcake,” the federal prison in Alderson, West Virginia. The prison earned its derisive name because the inmates enjoy the privileges of washers, dryers, microwave ovens, hair dryers, curling irons, manicures and pedicures.

Previous well-known inmates have included former Detroit Councilwoman Monica Conyers; Martha Stewart and the two women who tried to assassinate President Gerald Ford: Sara Jane Moore and Charles Manson follower Lynette “Squeaky” Fromme.

In their complaint against her, prosecutors accused Diane Hathaway of hiding assets worth more than $1 million and lying to lender ING Direct about it in order to obtain a short sale approval.

Defense lawyer Steve Fishman argued that Hathaway and her husband Michael Kingsley actually saved the bank money by accepting the short sale rather than allowing it to be taken to foreclosure auction.

If you want to read in more detail the allegations prosecutors made against Diane Hathaway and conclude for yourself why she pleaded guilty, use the search bar at the left of this blog to find them

Read the original article for this post in the Detroit News.

California State Bar Court Orders Attorney to Stop Practicing Law

August 14th, 2013 at 3:42pm

Ignoring California law has become very costly for a man who has only been practicing law in California for four years.

Stephen Siringoringo, of the Siringoringo Law Firm, was ordered by the California State Bar Court on July 29 to stop practicing law. He was classified as “ineligible to practice law” by the court because he took advance fees from clients to do mortgage modification work for them. Taking  advance fees has been illegal since 2009 and was a law sought and passed as Senate Bill 94 (SB94) by former California Attorney Edmund G. Brown, now the state’s governor.

Siringoringo’s law firm found clients by advertising in Southern California. According to judge Richard Honn, the firm obtained over 4,300 loan modifications. Some of the testimony heard by Judge Honn included declarations from 14 forms clients of the Siringoringo Law Firm. The upfront fees charged ranged from $3,500 to $8,490 according to the state bar’s investigation.

Read the original article in the Press Enterprise.

Inland Empire Man Discovers Acquaintance May Have Bought House in His Name

August 14th, 2013 at 3:20pm

An unnamed man is the victim of a “friend” who allegedly befriended him in 2007, offered to help him qualify for a home loan and then according to authorities used the victim’s information to buy a home for himself (loan fraud, real estate fraud).

Ruben Oscar Palagonia, a 67-year-old San Bernardino resident, has been arrested and charged with identity theft, forgery and recording false documents.

According to Investigator Ed Nyberg with the San Bernardino County District Attorney’s Office, the investigation by the Real Estate Fraud Unit began when the victim filed a real estate fraud complaint against Palagonia.

In a press release, Nyberg said, “About two years later the victim tried to purchase a home and discovered he already owned one. When the victim was advised of the location of the home, he went by the location and discovered that Palagonia was living in the residence.”

Read the original article in the Press Enterprise.

Allegedly Diverting $10,000 from Canceled Escrow Lands Pasadena Man in Jail

August 14th, 2013 at 3:09pm

Jose Eduardo Martinez, Jr., obviously didn’t count on getting arrested and charged with grand theft and real estate fraud.

According to police in Thousand Oaks, Martinez, a Pasadena resident, allegedly wired the refund for a canceled escrow being handled by his company into his own bank account.

Not surprisingly, he is sitting in Ventura County Jail on bail of $10,000.

Read the original article in the Ventura County Star.

2nd Edition of Short Sale Fraud Book is Available!

August 8th, 2013 at 3:14pm

Dear Readers and Subscribers,

In February 2012, I published the first and only book about short sale fraud, aptly titled “How to Commit Short Sale Fraud . . . and Get Away with It.” The purpose of this book is to educate the public and law enforcement about the financial and societal consequences for what is essentially an ignored and unprosecuted crime.

My book explains the economics that led to the development of short sales, how a legitimate short sale should be processed, examples of non-arm’s-length short sales, the very short list of prosecutions that have occurred and who is to blame for the lack of prosecutions. It also talks extensively about the market for REO (foreclosure) properties and the frauds that occur with those sales.

This second edition updates a lot of information based on events that have occurred since the original publication. There are new cases that have been prosecuted – but sadly, just a handful – and more literature on the topic of short sale fraud including more schemes. I’ve also updated some of my recommendations as to what can be done to mitigate this increasingly ubiquitous crime.

If you are in agreement that short sale fraud is a problem in your community, I urge you to read my book, which has been written and organized very much like a white paper. It has extensive footnotes in the form of hyperlinks and addresses most of the issues and complexities surrounding short sale fraud.

My book can be purchased for Kindle devices on Amazon.com at this link:

http://www.amazon.com/Commit-Short-Sale-Fraud-ebook/dp/B0078P4056

(Note: if you do not own a Kindle, you can still purchase and read the Kindle version on your computer and/or laptop by downloading the free application from Amazon.com.)

If you have an iPad, you can purchase my book on Smashwords at this link: https://www.smashwords.com/books/view/131921

Many thanks to all my readers for their support, their kind words of encouragement and their observations.

Monique Bryher / Publisher
California Real Estate Fraud Report

p.s. As a sidebar, there are now other professionals raising their voices against short sale fraud, e.g., this link at Nolo Press is called “Short Sale Fraud: Three Scams to Avoid.”

© Copyright 2007-2015 Monique Bryher

Legal Disclaimer.

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.

ALL RIGHTS RESERVED. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying, recording or by any information storage and retrieval system, without written permission from the author, except for the inclusion of BRIEF QUOTATIONS in a review.

BLOG POWERED BY SHARP BIZ IMAGE

Copy Protected by Chetans WP-Copyprotect.