California Real Estate Fraud Report

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Archive for the 'Bank Fraud' Category

Industry Expert Says Mortgage Fraud Characterized by Delayed Discovery

October 6th, 2017 at 8:10am

Bridget Berg, a principal in Industry Solutions and Property Intelligence for CoreLogic, says that mortgage fraud is different than other forms of fraud and is more prevalent than most lender think.

In a 3-part interview in Mortgage News Daily, Ms. Berg outlines five reasons lenders should be wary.

 

 

Navy FCU Hit by Home Equity Loan Fraud (HELOC Fraud)

October 5th, 2017 at 8:16am

Atlanta business owner Thomas Scott Brown, 47 was sentenced to three years in prison last week for operating a home equity loan fraud (HELOC fraud) scheme that cost losses of almost $3 million for the $82 billion Navy Federal Credit Union.

In addition to his prison sentence, U. S. District Judge Claude M. Hilton also ordered Brown to pay $2.7 million in restitution and to serve five years of supervised released. Brown pleaded guilty in May to one felony count of bank fraud and one felony count to making a false statement to a financial institution.

Brown’s scheme – which involved over 50 properties – centered on him purchasing properties with his own money and putting them in the name of straw buyers. Ownership was transferred to the straw buyers, who were then directed to apply for HELOC loans and to pay those proceeds to him. For his efforts, he earned profits of $1.4 million.

Read the original article in Credit Union Times.

 

Appraisal-free mortgages will make closings easier – and create more opportunities for fraud

September 23rd, 2017 at 10:02am

There’s no doubt that decisions by Fannie Mae and Freddie Mac to not require appraisals on certain loan categories will create a shift in residential real estate transactions. The downside is that this creates new opportunities for fraud.

Read the full article in Inman News.

San Diego Mansions Used in $50 Million Mortgage Fraud Scheme

September 21st, 2017 at 10:05am

A real estate broker and a senior executive at a real estate investment company have been indicted wire and mail fraud conspiracy, wire fraud, mail fraud, aggravated identity theft and criminal forfeiture in connection with a multi-million dollar mortgage fraud scheme.

According to a press release by the U.S. Attorney’s Office for the Southern District of California, Peter Cash Doye, a senior executive at the real estate investment firm known both as Conix and Variant Commercial Real Estate, and Raquel Reid, a licensed real estate broker and notary public, allegedly conned lenders into providing loans for four multi-million dollar mansions in La Jolla and Del Mar.

Court documents indicated that Doye and Reid used numerous forged documents to trick the lenders into believing the loans had been paid off in order to obtain new loans against the properties.

Co-defendants Courtland Gettel, and an Arizona attorney, Jeffrey Greenberg, previously pleaded guilty to their roles in the scheme.

The mansions had been represented to the lenders as rental and investment properties but were lived in by Doye and Gettel and their families.

Read the original article in HousingWire.

Four Phoenix Family Members Sentenced For Real Estate Fraud and Tax Evasion

September 14th, 2017 at 12:13pm

All in the Family – parents and two sons go to prison for operating large-scale real estate fraud scheme.

“PHOENIX – Yesterday, Senior U.S. District Judge Neil V. Wake sentenced Daphne Iatridis and her husband, Arthur Telles, both 59, to 30 months in prison and ordered the couple to forfeit 26 fraudulently purchased properties to the United States. Both had previously pleaded guilty to conspiracy to commit mail and wire fraud and tax evasion. The couple’s sons, Brendyn Iatridis and Spenser Iatridis, also pleaded guilty to related crimes and were sentenced to 10 months in prison and probation, respectively.”

Read the full press release by the U.S. Attorney for the District of Arizona.

Equifax Data Breach: What can you do to protect yourself?

September 8th, 2017 at 1:18pm

From my colleague Erik Kaplan at THD Credit Consulting

Hey it’s Erik,
This data breach is among the worst ever because of the amount of people affected and the sensitive type of information exposed. With Social Security numbers, names, birth dates, addresses, driver’s licenses and credit card numbers exposed, up to 143 million Americans could be vulnerable to identity fraud.
Here is what you can do today:
  • Fraud Alert: Consider placing a fraud alert on your files for 1 year. This warns creditors that you may be an identity theft victim and they should verify that anyone seeking credit is actually you. You can do this by clicking here.
  • Credit Freeze: Also known as security freeze, this tool lets you restrict access to your credit report, which makes it more difficult for identity thieves to open new accounts in your name. Click here to do this now.
  • Monitor Your Credit: Keep an eye on Hard Credit Inquiries, New Accounts, and Uncharacteristic Transactions. CreditKarma.com offers free credit monitoring of your TransUnion credit report, which means you will receive notifications if something changes.  The service is free to all members. *credit karma scores are not always accurate
  • Check Your Credit Reports: Every year, you can request a free copy of your report from each of the three major credit reporting agencies. This means that you can effectively check your credit free every four months or so.
Have questions?
Reach out to our team of experts at asktheexpert@thdcreditconsulting.com.
Erik Kaplan
THD Credit Consulting

Central Coast Developer Kelly Gearhart Gets New Sentencing, Restitution Hearing

September 8th, 2017 at 8:47am

Developer Kelly Gearhart, sentenced to 14 years in prison in 2015 for wire fraud and money laundering, will receive a new sentencing and restitution hearing after the Ninth U.S. Circuit Court of Appeals ruled that Judge Otis Wright II erred in sentencing Gearhart to 14 years in federal prison. Gearhart pleaded guilty in 2014 to real estate fraud.

The appellate court determined that Judge Wright erred when he sentenced Gearhart to 14 years for money laundering even though the maximum sentence is 10 years according to statute. The appellate court further determined the judge didn’t spend enough time on matters related to enhancements and the restitution amount, which is currently sealed.

Kelly Gearhart failed in his motion to have the rehearing assigned to another judge.

Read the original article in the Cal Coast Times.

Bay Area Man Sentenced to 15 Prison in Short Sale Fraud Scam

August 18th, 2017 at 10:24am

Mahendra Prasad, 55, pleaded guilty on May 22, to one count of mail fraud affecting a financial institution in connection with a fraudulent short sale (short sale fraud), according to a Justice Department press release. On August 14, U.S. District Judge Lawrence J. O’Neill sentenced him to 15 months in prison and ordered him to pay $328,000 in restitution to the lending institution that was defrauded.

According to court documents, in 2006, Prasad allegedly submitted falsified documentation to a lender so that he could purchase a property in Sacramento. Following the purchase, he rented the property as Section 8 housing.

In 2013, Prasad completed a short sale of the property to another person, claiming that the sale was “arm’s length, which was a requirement of the lender.

His co-defendants Jyoteshna Karan, Praveen Singh, Sunita Singh and Nani Isaac are going to trial in U.S. District Court in Fresno, on Dec. 11.

Read the original article in News India Times.

Nevada Men Indicted in Fraudulent Short Sale

August 18th, 2017 at 9:55am

Acting U.S. Attorney Steve Myhre for the District of Nevada announced that two men have been indicted in connection with the sale of one man’s property to a family member of his friend (short sale fraud).

The indictment alleges that Dustin Lewis (Henderson, NV) and Brian Sorensen (Las Vegas, NV) conspired to defraud OneWest Bank when Lewis submitted a fraudulent short sale application to the bank to sell the home to a relative of Sorensen. The plan was to prevent a foreclosure so that Lewis could keep possession of the 5,331-square foot, five-bedroom home in Henderson. It is further alleged that Lewis did not disclose to the bank that he and Sorensen had an agreement that Lewis would remain on the property and that later it would be sold back to him.

The case was investigated by the Federal Bureau of Investigation (FBI), the Internal Revenue Service-Criminal Investigation (IRS-CID) and the U.S. Department of Interior-Office of the Inspector General. Assistant U.S. Attorney Patrick Burns is the prosecutor.

Read the original article in Mortgage Professional America.

Wells Fargo Pays Out Again, This Time For Fraudulent Anti-Veteran Lending Practices

August 18th, 2017 at 9:08am

Banking giant Wells Fargo must pay over $100 million to settle allegations of fraud that included overcharging military veterans using the VA Home Loan to refinance their mortgages. The victims were not only veterans but U.S. taxpayers.

Brokers Victor Bibby and Brian Donnelly were the two whistleblowers in the lawsuit who sought to recover the losses that the federal government suffered when the loans it guaranteed loans defaulted. The two men sued Wells Fargo and seven other lenders to recoup losses; notably the federal government declined to join the qui tam lawsuit, which was filed under the federal False Claims Act, aka Lincoln’s Law (31 USC §§ 3729-3733.

The other banks are Bank of America Corp (BAC.N), Citigroup Inc (C.N), First Tennessee, JPMorgan Chase & Co (JPM.N), PNC Financial Services Group Inc (PNC.N) and SunTrust Banks Inc (STI.N). The total pay-out is $161.7 million.

Depending on whether the federal government offers to assist, the private person can receive a portion of the recovered damages, from 10% to 30%. If the government intervenes, the person bringing the lawsuit, the “relator”, receives between 15%-25%. If the government does not, the relator receives between 25%-30%. If the government intervenes and most of the information is already public, the relator is only entitled to 10%.

Read the full article, including Wells Fargo’s boilerplate “apology,” in DisabledVeterans.org

© Copyright 2007-2017 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.

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