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.

Archive for the 'Real Estate Investment Fraud' Category

Montecastro Mortgage Fraud Case Delayed

July 27th, 2012 at 9:06am

The $142 million mortgage fraud and securities fraud trial for Hendrix Montecastro and his mother Helen Pedrino have been moved to October 9.

Hendrix Montecastro and Helen Pedrino were arrested in 2009 on charges they were part of a real estate investment fraud conspiracy headed by James Duncan. The real outcome was that many investors lost their savings, retirement accounts and even their homes as a result of alleged false promises to earn large returns.

James Duncan and defendants Maurice McLeod, Charlie Sung Choi, Thuan Nhan Du and Cindi Gayle Kelly have already pleaded guilty.

Read the original article in the Press Enterprise. There are also several earlier postings on Hendrix Montecastro and Helen Pedrino in the California Real Estate Fraud Report. Use the Search feature on the left side of this blog to find those articles.

Developer Pleads Guilty in Running Horse Golf and Country Club Real Estate Fraud

July 27th, 2012 at 8:56am

A former Carmel real estate broker has pleaded guilty to federal wire fraud and money laundering as a result of a high-end golf course project in Fresno. He could receive up to 20 years in federal prison when he is sentenced this November U.S. District Court Judge Lucy Koh.

Thomas J. O’Meara III was the president of Cypress Investment Corp. in Carmel. According to the U.S. Attorney’s Office of Northern California, O’Meara, defrauded more than 50 investors in the Running Horse Golf and Country Club project out of more than $16 million. O’Meara’s license to practice real estate was revoked in 2008.

O’Meara’s plea deal includes paying restitution of $7 million in restitution to his victims, some of whom lost millions, such as the family of Carmel real estate broker Joyce Scampa. Prosecuters stated that total losses were $25 million.

The Running Horse Golf and Country Club was a speculative 450-acre development that apparently attracted investors with its golf course designed by Jack Nicklaus and 780 upper-end homes. None of the homes were ever built and only two holes of the golf course were completed.

Read the original article in the Monterey County Herald.

Ramona Realtor Pleads Guilty in Mortgage Fraud Conspiracy

July 20th, 2012 at 9:59am

Ramona real estate agent Teresa Rose has pleaded guilty to conspiracy to commit wire fraud and to launder money in an elaborate mortgage fraud that cost lenders at least $5 million.

Rose, loan broker Mary Armstrong and Armstrong’s assistant William Fountain were indicted for recruiting so-called investors via newspaper and online solicitations to purchase Ramona and other local properties. The investors turned out to be no more than straw buyers who sold the use of their credit for $10,000.

Loan applications were falsified in order to qualify for the maximum loan amounts (mortgage fraud, loan fraud). Prosecutors allege that the defendants made the majority of their illegal gains by convincing the property sellers to inflate the value of their homes, purportedly justified because they were going to be improved by construction that never occurred. In addition, the defendants earned commissions and other escrow-related fees. Because Teresa Rose was representing both the sellers and buyers, she was able to collect the full commission (dual agency) on all of her sales.

Teresa Rose’s real estate license shows no disciplinary action the California Department of Real Estate.

Read the original article in the Ramona Patch.

Southern California Realtor® Arrested for Real Estate Fraud

July 16th, 2012 at 8:48am

Torrance real estate agent Jong Hwan Huh, 47, has been arrested by the Lomita Sheriff’s station for defrauding seven of his clients out of more than $400,000.

Huh, aka David Huh, was charged with 17 counts of grand theft, forgery, issuing iad checks and cnhancements for aggravated white-collar crime by the Los Angeles County District Attorney’s Office.

Detective Ron Sabatine from the Los Angeles County Sheriff’s Department, when questioned about David Huh’s alleged crimes, said “Although there were variations in the schemes, they all involved obtaining money from the victims for real estate purchases or leases, and misappropriation of money.” Investigators believe Huh spent his victims’ money on gambling at local casinos instead of investing it in real estate (real estate fraud).

Huh is (or was) employed by Masters Realty Group. His license with the California Department of Real Estate (DRE) is in a non-working status.

The Los Angeles County Sheriff’s Department Commercial Crimes Bureau, Real Estate Fraud Unit, can be reached at (562) 946-7217.

Read the original article in the Los Cerritos Community News.

North Hills Realtor Charged in Real Estate Fraud / Ponzi Scheme

July 13th, 2012 at 10:49am

Celia Gallardo, 42, a Realtor® from the North Hills community of the San Fernando Valley, was arrested and charged with running a multi-million dollar Ponzi scheme in the  Santa Clarita Valley.

The Department of Justice, in its indictment, accused Gallardo of stealing from investor who trusted her with her real estate investment program, which turned out to be nothing more than a Ponzi scheme. Amazing, she promised them returns of 100% in 30 days. Gallardo used most of the money to finace travel, purchasing a residence and keeping a lot of cash in her wallet.

Read the full article in the Daily News.

Jury Selection in Hendrix Montecastro Mortgage Fraud Trial Begins

July 6th, 2012 at 11:09am

A man and his mother who are on trial in an alleged $142 million mortgage fraud and securities fraud prosecution are taking turns with the prosecution, conducting their own voir dire as part of their self-representation, having fired all of their attorneys.

Hendrix Montecastro, 39, of Murrieta, and his mother, Helen Moreno Pedrino, are charged with grand theft, securities fraud, corporate identity theft and elder abuse (elder financial abuse). They are among seven people who were arrested in 2009 for scamming small-time investors and being responsible for the foreclosure of more than 100 homes in Riverside County. The ringleader James Duncan and the other five defendants have already pleaded guilty for their roles.

Read the original article in the Press Enterprise.

Atascadero Developer Kelly Gearhart Indicted for Real Estate Investment Fraud

July 6th, 2012 at 10:59am

Developer Kelly Gearhart has been indicted by a criminal grand jury on federal fraud and money laundering charges in connection to monies he solicited from investors for real estate projects (real estate investment fraud).

The eight-page indictment charges that the 50-year old businessman, dubbed the “Citizen of the Year” in 2005 by the Atascadero Chamber of Commerce swindled millions from investors he duped by telling them the loans were secured by his own real estate investments. Instead, according to the indictment, he sold the same lots over and over to multiple buyers and did not own the land he claimed to own. The grand jury alleged that he used the funds he received to furnish a “lavish” lifestyle; some of which is bound to come out during the hearings for his $110 million bankruptcy.

Gearhart, who faces up to 300 years in prison if convicted of all the charges, also used pooled funds from bankrupt Hurst Financial Corp. Its former president James Hurst Miller has already pleaded guilty to four counts of fraud and money laundering charges in 2011.

Read the original article in the San Luis Obispo Tribune.

Authorities Seek Victims in Real Estate Fraud

June 22nd, 2012 at 9:04am

The Placer County Sheriff’s Department is looking for victims of a Meadow Vista man they have arrested in a real estate fraud matter.

William Frank Lordier, 54, was arrested earlier this week on suspicion of felony grand theft. Victims told detectives that he advertised timeshares on Craig’s List and convinced them to give him their bank account information, which he used to withdraw money for his own use. Lordier once was a licensed real estate salesperson with the California Department of Real Estate but his license expired in 2011.

The alleged victims live in Los Angeles and Nevada counties and also in Oregon and Washington state.

If you feel you have been victimized by Lordier, please call Detective Jason Doolittle at (530) 889-7844.

Read the original article in the Sacramento Bee.

Three Indicted in Los Angeles for Short Sale Fraud Scheme Using Phony Bank Approvals

June 21st, 2012 at 2:56pm

Dear Readers,

There have been a number of articles in the media in the past week about three people who have been arrested for running a conspiracy to defraud banks and investors by engaging in a unique form of short sale fraud. Unfortunately, while the articles have shown the photos of the defendants and some of their alleged ill-gotten gains, they do not adequately describe the wrongdoing of which the defendants are accused.

So . . . here it is, my own abstract, prepared especially for law enforcement who are working real estate fraud cases outside the jurisdiction of this one and would like to catch up on current crime patterns.

Ahmed Tariq Asghari, 32, of Sherman Oaks; Kenneth Moore, 49, of Tustin; and Atiqullah Nabizada, 29, of Coto de Caza have been indicted for running a short sale fraud operation that may have defrauded the victims of as much as $10 million. According to the FBI Press Release, Nabizada and Moore were charged with conspiracy to commit wire fraud and aggravated identity theft and Asghari, has been charged with attempted bank fraud, aggravated identity theft and causing an act to be done. If convicted, the men could each face lengthy prison sentences.

The schemes were carried out in Los Angeles County and to date involved at least six residential properties.

Search warrants were executed last week at locations in Orange County and Los Angeles County.

Here is how the crimes were committed, according to the search warrants:

Nabizada told a witness (referred to in the search warrants as the “Cooperator”) that he had an inside contact at Bank of America who, in exchange for a bribe, would approve short sales for well-below fair-market value. The Cooperator then told Asghari of the scheme and offered to bring him into it if Asghari would find investors or even straw buyers who would pay fair-market value for the properties.

Nabizada apparently had no such insider willing to approve short sales for below-market value at Bank of America; instead, he merely produced forged documents himself. These documents would be presented to escrow, which in many cases, was handled by Jackie Burchell, who worked at Point Break Escrow (PBE) in Costa Mesa. The title company would wire the funds, issue and record the new title policy and escrow would be closed. The property, which had clear title, would then be resold to an unsuspecting buyer. In the meantime, Bank of America would return the wired funds, stating it had not approved the short sale. The buyer would be left holding title to a property for which the original liens by Bank of America and perhaps a subordinate lien holder were still in place and in force.

According to the search warrant, Burchell has acknowledged being aware that she was working on behalf of Nabizada and Asghari by “concealing documents and producing and/or knowingly transmitting fraudulent documents,” that she concealed payments to both men and produced fraudulent HUD-1 statements.

This complicated case was investigated jointly by the FBI, the Secret Service, the Los Angeles County Sheriff’s Office, the Department of Motor Vehicles (DMV).  André Birotte Jr, the United States Attorney in Los Angeles, announced that his office will be prosecuting the defendants; the lead prosecutor is Ariel Neuman.

Tariq Asghari’s office, where one of the search warrants was executed, is located at 18850 Ventura Blvd, Tarzana, California.

Click here to get the search warrant for Tarzana, and click here to read the Orange County search warrant.

Update:

On January 9, 2013, Jackie Burchell was arrested and charged in connection with another real estate fraud scheme, according to an FBI Press Release. She was barred from any employment in an escrow agency as a result of an administrative enforcment action taken by the California Department of Business Oversight (formerly California Department of Corporations) in November 2012.

Latinos Charged in Ripping Off Latinos in Real Estate Fraud Ponzi Scheme

June 15th, 2012 at 7:20am

Two  men have been charged with running a$1.3 million real estate fraud Ponzi scheme that targeted Latino investors, in what appears to be a case of affiinity fraud (ethnic fraud), since the defendants are also Latinos. 

California Attorney General Kamala Harris announce that Edwin Salazar, 34, of Downey and 41-year-old Michael Zuniga of Fullerton have been charged with multiple counts of grand theft, elder financial abuse, burglary and conspiracy and that 18 victims have been identified. The two who apparently were insurance agents, convinced their victims to refinance their homes in order to participate in “risk-free” (that’s a hint) investments with guaranteed returns of 15% with their firm Omega Investment Group. The so-called investment was nothing more than a Ponzi scheme, with the defendants helping themselves to $700,000 for their own use.

Read the original article in the Diamond Bar Patch.

© 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.

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 Chetan's WP-Copyprotect.