October 5th, 2012 at 11:46am
DSNew (Default Services News) has just published the October issues of its magazine, in which they interviewed me and other industry experts on the topic of short sale fraud: how prevalent is it, what the banks are (not) doing about short sale fraud, regulatory agency involvement (Fannie Mae, Freddie Mac) and private sector solutions, such as CoreLogic.
This is a well-written, thoughtful article and worth your reading if you are concerned about short sale fraud and how it affects not only your own property’s values but the effect it has on the ability of government to function with less revenue from property taxes than it is entitled to receive.
“DSNews Oct 2012 – Anatomy of a Fraudulent Short Sale” is on page 55 of the October issue of DSNews.
October 4th, 2012 at 2:46pm
A man from the San Fernando Valley community of Tujunga is going to prison for more than 3 years for lying to banks in order to obtain home equity lines of credit (HELOC) on his home’s mortgage.
David Han, aka Young He Kim, pleaded guilty to four counts of bank fraud. He brazenly had filed four loan applications to four different banks on his only property.
United States District Judge Manuel L. Real ordered Han, 50, to pay $1.1 million in restitution to the victims/banks.
October 4th, 2012 at 2:36pm
Two men – one of them an attorney – are the targets of a 50-count indictment that accuses them of operation an $11 million loan modification fraud.
Dean G. Chandler, 47, an Oceanside attorney, Shelveen Singh, 25, a telemarketing salesman are charged with running the alleged mortgage rescue fraud from Chandler’s office, 1st American Law Center. The purpose was to persuade distressed homeowners to use the services of what was promoted to be a successful law firm.
According to Leslie P. DeMarco, Special Agent in Charge of the Los Angeles Field Office of IRS Criminal Investigation, “Mortgage modification scams prey on struggling and trusting homeowners. Today’s court actions are a strong reminder of how serious our courts consider this criminal activity.”
All four are accused of using high-pressure sales tactics and lies to convince homebuyers to sign up with their firm, claiming that 98% of their loan modifications succedded. Chandler also promoted himself as the managing attorney on his website and television ads.
Chandler, Singh and previously-indicted defendants Anthony Calandriello and Michael Eccles are charged with conspiring to commit mail fraud and wire fraud. In addition, Chandler faces charges of money laundering.
Read the original article in CBS8 San Diego.
October 4th, 2012 at 2:19pm
Blanca Sanchez, aka Blanca Maciel, will be sentenced at the end of this month on multiple felony accounts of operating a foreclosure rescue con.
Sanchez / Maciel was convicted by a jury last week; according to Monterey County District Attorney Dean Flippo, she could be sentenced to 16 years in prison. Four of the five felonies on which she was convicted, are related to residential burglary. Under California’s Three Strikes Law, the convictions are viewed as prior offenses.
The sentencing judge is Monterey County Superior Court Judge Mark Hood.
The case was prosecuted by Deputy District Attorney John Hubanks of the DA’s real estate fraud unit.
Read the original article in the Monterey County Herald.
October 4th, 2012 at 2:10pm
Two Roseville residents have been arrested and charged in an alleged loan modification scam.
Martin Wayne Flanders, 48, and Ligia Sandoval Spafford, 46, are facing the accusations in a Sacramento federal court. Prosecutors claim that Flanders illegally charged upfront fees for loan modifications and other mortgage relief “services” to his victims, mostly Latinos found through Spanish language radio broadcasts. He will also be charged with bankruptcy fraud for filing phony bankruptcy petititions.
As is typical with loan modification frauds, many of the victims have lost their homes to foreclosure.
Read the original article in the Sacramento Business Journal.
October 4th, 2012 at 1:57pm
A man from Brentwood in Contra Costa County is in big trouble after coming to the attention of the Office of the Special Inspector General for the Troubled Asset Relief Program (SIGTARP) and United States Attorney for the Eastern District of California Benjamin B. Wagner.
Alan David Tikal has been arrested and charged with operating a multi-state mortgage rescue fraud that homeowners in distress to the tune of $3.1 million. Tikal’s alleged unique con was that he convinced the homeowners – for a fee of course – that he could convince lenders to settle for a fraction of the mortgage debt and replace it with new mortgage debt to his company, KATN Trust, at 25 cents on the dollar. Amazingly, more than 1,000 homeowners fell for this ploy and most lost their homes to foreclosure proceedings.
Christy Romero, Special Inspector General at SIGTARP stated: “As alleged, Tikal’s operation duped victims with false claims of drastically lowering their mortgage debt in exchange for advance fees. As a result of his alleged deceit, homeowners’ financial condition worsened, and for some, the opportunity to participate in legitimate loan modification programs such as the government-sponsored Home Affordable Modification Program (HAMP) was lost. SIGTARP will continue to work aggressively with our law enforcement partners to stamp out this type of abuse.”
Read the original article in National Mortgage Professional. You can also read the press release of the Department of Justice, Eastern District of California, Office of United States Attorney Benjamin Wagner.
You can also read previous articles about Alan David Tikal on the California Real Estate Fraud Report by searching for his name on the left side of the blog.
September 28th, 2012 at 10:05am
I am working on the second edition of my ebook “How to Commit Short Sale Fraud . . . and Get Away with It” and am interested in adding new short sale fraud scenarios. The fraudsters are always one step ahead of us!
If you are a Realtor® or a bank auditor who would like to share a unique scenario of a short sale fraud you know of, please feel free to email me. The specific information (location, price, agents, how it was done) will remain confidential, as will you, just as the ones presented in my ebook are. Consider it your contribution to the small library of knowledge on this unprosecuted, risk-free crime.
DSNews (Default Servicing News), a well-known publication in the mortgage industry, recommended my ebook in their “Good Reads” section in the August 2012 issue.
Another milestone: today, the California Real Estate Fraud Report has reached the 900 articles/postings mark, proof that there is no shortage of real estate fraud occurring in California.
September 27th, 2012 at 7:12pm
A Linden-area man named Kory Schmidli, 34, has been indicted along with eight other people by a federal grand jury in a local mortgage fraud scheme.
Schmidli is alleged to have acted as a straw buyer, along with friends, family and employees of brothers Volodymyr Dubinsky and Leonid Doubinski. The brother were developers who used their associates, such as Schmidli, to purchase up to 19 residential properties for them. In addition to using the straw buyers’ good credit, their financial assets were embellished in order to obtain the loans (loan fraud).
Read the original article in RecordNet.com.
September 27th, 2012 at 7:00pm
A small measure of justice has come to 21 homeowners who lost their homes due a husband-and-wife team of scammers.
According to the Internal Revenue Service (IRS) in a statement released September 21, Joe Daniel Cody, 43, was sentenced in U.S. District Court in Riverside to 63 months in prison and three years of supervised release in a mortgage fraud, equity-stripping scheme. His wife, Angela Lynette Cody, 43, got 48-months and three years supervised release. The pair was ordered to pay more than $1 million to their victims in restitution.
Although based in Murrieta, the Codys were employed by All Fund Mortgage, which was based in Tacoma, Washington. They targeted many homeowners in the hard-hit Riverside or San Bernardino counties, offering to refinance or sell their homes to third-party straw buyers temporarily. Instead of making the payments on the mortgages, the straw buyers stripped the equity and walked away, causing the original homeowners to lose the homes to foreclosure.
No word as to whether any of the straw buyers were prosecuted.
Read the original article in the Press Enterprise.
September 26th, 2012 at 9:24am
The owner of a Pasadena mortgage brokerage firm was sentenced to nine years in prison by U.S. District Court Judge David O. Carter for operating an ambitious mortgage fraud scheme that victimized both lenders and borrowers.
According to U.S. Attorney Andre Birotte Jr., Eduardo Ruiz, 33, and his co-defendants, sister Gilma Ruiz, 36, and 26-year-old brother Francisco Ruiz, submitted fraudulent loan applications on behalf of borrowers, many of whom did not speak English. At least 20 of the borrowers subsequently lost their homes to foreclosure, homes they never could have purchased if the applications had been submitted containing truthful information. Gilma and Francisco each received 18 month sentences, but that’s not much considering up to $30 million of the loans were fraudulent and the restitution ordered by the court against Eduardo is $5.7 million.
Eduardo Ruiz and his employees in 2005 and 2006 falsely inflated the income of more than 100 borrowers seeking home loans, officials said. Many of them did not speak English and were unaware of the fraud.
According to Leslie P. DeMarco, Special Agent in Charge of the IRS – Criminal Investigations Los Angeles Office, “Eduardo Ruiz and his cohorts knew the borrowers never had a prayer of making their mortgage payments and that many of the loans would go into foreclosure. Mortgage fraud crimes drive buyers into foreclosure, leave lenders burdened with bad loans and leave neighborhoods with abandoned and deteriorating properties.”
Read the original article in the Pasadena Star News.