California Real Estate Fraud Report

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Archive for May, 2010

6 indicted for mortgage fraud in San Diego

May 25th, 2010 at 6:40pm

Six people have been charged with conspiracy to commit wire fraud and wire fraud in a federal indictment.

Brian Andrew La Porte, Daniel John Schuetz, Michael Wayne Wickware, Roxanne Yvette Hempstead, Darryl Anthony Wallace and Terrence Smith are alleged to have submitted false loan applications to OwnIt Mortgage Solutions Inc., WMC Mortgage Corp., Argent Mortgage Company, Countrywide Home Loans and First Franklin, resulting in the loss of almost $21 million to the lenders. The defendants used straw buyers with good credit histories to obtain the loans, then paid themselves and the straw buyers with the escrow proceeds.

Read the full article in San Diego 6 and LoanSafe.

Guilty Plea in $100 million mortgage fraud

May 25th, 2010 at 6:31pm

Sacramento homebuilder Anthony Symmes, 59, has agreed to plead guilty in a wide-ranging mortgage fraud scheme in which he conspired with others to raise the listed prices on homes he built and used some of the proceeds to repay straw buyers, himself and his co-conspirators.

Symmes alleged partner-in-crime is unlicensed mortgage broker Garret Griffith Gililland, who allegedly approached Symmes with the scheme. Gililland, who had fled to Spain, was arrested and now awaits his own Judgement Day.

The lenders that were victimized have foreclosed on 38 of the homes and are disposing of 10 more in short sales. Prosecutors believe that Symmes and Gililland may have involved as many as 500 residential homes and condominiums in California and other states in their crime spree. Symmes has already provided restitution of $4 million as part of his plea agreement. His prison sentence could range range from 10 to 20 years.

Read the full article in the Silcon Valley Mercury News.

Guilty plea in Ponzi scheme nets woman 15 years, 8 months

May 25th, 2010 at 6:14pm

A federal judge in San Francisco sentenced 63 year old Patricia Morgen to more than 15 years in prison for defrauding investors out of millions of dollars.

Morgen, who found Chicago Development and Planning, which had offices in Emeryville and Reno, was also ordered by U.S. District Court Judge Charles Breyer to make restitution of $9 million to her 400 victims, many of whom lost their life’s savings. The court-appointed receiver has only found about $620,000 from the ashes of Morgen’s company, as Morgen appeared to have operated a Ponzi scheme and spent the millions she stole on herself and some of her employees.

Read the full article in SF Gate, the San Francisco Chronicle.

Guilty plea for Hermosa Beach lender who defrauded investors

May 25th, 2010 at 6:00pm

Mary Elaine Perkins, owner of Carlton Financial Enterprises, Inc., has pleaded guilty to mail fraud after brazenly defrauding 90 investors out of $7 million in a real estate investment fraud scheme that was bound to be detected by authorities.

Perkins’ fraud was that she promised investors returns of 12% – 15% by using their money to make hard money loans to homeowners, using their properties as collateral instead of the homeowners’ credit scores. Instead, Perkins foreclosed on the borrowers’ homes in some cases and either sold their property to a company she owned or to members of her family. Apparently some of the early investors were repaid with monies she obtained from later investors, classic Ponzi scheme tactics.

Read the full article in the Los Angeles Times (LA Times).

Attorney General Brown charges 9 in Southern California with foreclosure fraud

May 20th, 2010 at 4:03pm

In a press release issued today, California Attorney General Edmund G. Brown announced that 9 men have been charged with operating a boiler room foreclosure fraud operation. The scam is reported to have fleeced some 1,500 homeowners out of more than $2.3 million by promising the desperate victims they would receive loan work-outs and modifications.

Four of the the men are already in custody: Gregg Scott Quinn, 37, of Camarillo, the ring’s sales manager; Juan Pierre Washington, 40, of Winnetka, a supervisor; Gary Arnold Eisenberg, 71, of Westwood, a top-performing telemarketer with the company; and Ira Itskowitz, 58, a sales manager. Eisenberg and Itskowitz have distinguished themselves by each having spent more than five years in federal prison for their previous fraud convictions.

Still missing are the four principal owners of the business: Niv Iskin, 30, of Reseda; Reviv Karpman, 38, of Tarzana; Tomer Kogman, 29, of Reseda; and Avraham Yechizkia, 34, of Encino; as well as a sales manager, Barel Iskin, 23, of Woodland Hills.

AG Brown’s office responsed to numerous consumer complaints against the defendants’ and their Canoga Park businesses at 8236 Remmet Avenue, Mason Capital Group, LLC and Gretchen Fox and Associates. Agents found a Las Vegas-style sales floor with casino-themed decor such as craps, poker and black jack tables fashioned into computer workstations. Top producing telemarketers received bonuses by spinning a roulette wheel.

As with all loan modification scams, this one preyed upon borrowers desperate to save their homes, who were enticed into relying upon false statements by the telemarketers that they had a “highly successful loan negotiation staff with over 20 years experience”, as well as paying upfront fees, a practice that is illegal unless performed by an attorney. Although Mason Capital Group and Gretchen Fox and Associates promised a guaranteed refund, in practice they refused almost all requests by dissatisfied clients to receive their money back.

The defendants have been charged with 97 criminal counts that include collecting advance fees for foreclosure consultant services, making false and misleading statements to induce homeowners to pay in excess of $400 for loan modification services, failure to remit business income tax returns, remitting false personal income tax returns and committing two or more felonies with White-Collar Crime Enhancement and Excessive Taking Enhancement.

Read the California Attorney General’s press release and the Declaration in Support of Arrest Warrants.

Westminster real estate broker convicted in $17.5 million real estate fraud

May 19th, 2010 at 12:35pm

A closely-watched case in Westminster in which a real estate broker was accused of stealing $17.5 million ended when Kathy Chen, 49, was convicted of multiple counts of real estate fraud. Chen was charged with using stolen identities in order to purchase properties, which she then defaulted on so that she could steal the loan money (and she thought this was go undetected?). She now awaits a July 9 sentencing by Superior Court Judge Lance Jensen and a possible 111 years in prison.

Chen was the owner of Chen Financial, KC Realty and SBC Financial. She was prosecuted by William Overtoom of the Orange County District Attorney’s Office and convicted of 136 felony counts for obtaining 47 fraudulent loans totaling more than $17.5 million.

Among Kathy Chen’s victims was a 92-year-old woman, whose identity was stolen. Chen and her co-defendants (all fugitives, including her boyfriend) were accused of falsifying loan applications by inflating the incomes of the purported buyers, forging names and signatures on deeds and loan documents and forging the seal and notary stamp on a variety of notarized documents and deeds.

Read the full article in the Orange County Register, aka OC Register.

Mother-daughter team accused of major real estate fraud in Kern County

May 19th, 2010 at 12:02pm

A mother-daughter team is sitting in Kern County jail after being unable to post bail of $1 million each.

Dawn Marie Kantin, 37, and her 69 year-old mother Alice Kantin, have been charged with dozens of counts of conspiracy, embezzlement, theft, notary fraud and forgery. The charges arise from a real estate fraud scheme in which at least 32 people were cheated out of $2.3 million from 18 homes that went into foreclosure.

Alice Kantin is the owner of Desert Air Real Estate Investments, Inc. in Bakersfield, a company that is not registered with the California Secretary of State.

The Kantins purportedly contracted with homeowners in default to take over their mortgage payments; instead all the homes were lost to foreclosure. In addition, 14 tenants with options to purchase the homes also lost their investments due to the foreclosures.

While mother Alice allegedly put the deeds of the distressed homeowners in her name or that of Desert Air Real Estate Investments while she searched for a renter to purchase the home, daughter Dawn Kantin allegedly busied herself with committing notary fraud. Dawn Kantin is not only not a licensed notary public in California; her application to become one was denied the California Secretary of State’s office because of “substantial and material misstatement or omission in the application” according to by Gordon Isen, Deputy District Attorney of the Kern County District Attorney’s Real Estate Fraud Unit.

Read the full article in the Bakersfield Californian.

Bay Area man indicted for fraudulent purchase of condos

May 19th, 2010 at 11:33am

James Delbert McConville has been indicted by a federal grand jury on fraud and money-laundering charges. He is accused of using the identities and credit records of straw buyers to purchase 80 condominium units in Escondido and San Marcos. The straw buyers were paid $5,000 to $10,000 for renting their credit histories to McConville.

Also named as co-conspirators in the indictment were real estate agent Laura Margery Caton, Jason Piette, Rasul Rasuli, Donna Demello (an escrow officer) and Araks Davoudi (a personal banker). All have been ordered to appear before the court in June.

McConville has a prior conviction for grand theft in 1998, for which he was ordered to pay restitution for committing insurance fraud. His whereabouts are currently unknown, according to the San Jose Mercury News.

Read the full article in the San Diego Union Tribune.

Elder financial fraud = possible prison sentence for bank manager

May 19th, 2010 at 11:06am

A former branch manager at Bank of America in Willow Glen, California, has pleaded no contest to elder fraud and grand theft. He could receive up to four years and eight months in prison for stealing $18,000 from elderly clients of the bank and unbeknownst to them, issue ATM cards.

Santa Clara County prosecutors say that Maurizio Contarino, 47, is a member of a new club of criminals that consists of bank employees that rip off their customers. Another banker, ex-Wells Fargo employee John Tran, was arrested several month ago and is accused of also stealing from elderly customers (see the March 25 article in the California Real Estate Fraud Report entitled Former Wells Fargo manager accused in elder financial fraud).

Contarino’s crimes entailed accessing the accounts of Bank of America’s elderly customers, ordering the ATM cards, and changing their addresses to that of his branch. He would then use the debit cards to steal money from their bank accounts.

[Note: I worked for Carte Blanche Corporation in the mid-1970s. A small group of employees there committed similar crimes: they issued extra credit cards in the customers’ names, changed the addresses so that the employees would receive the cards, then changed the address back to the customers’ addresses, all in the same billing cycle. By the time the customers called to complain about the charges, their accounts had been charged up. I don’t believe those employees were ever prosecuted, even though management had a good idea which employees were committing the fraud.]

Read the full article in the Silicon Valley Mercury News.

Livermore accountant pleads no contest to operating a Ponzi scheme

May 13th, 2010 at 9:44pm

Livermore accountant Maynard Weldon Moreland has pleaded no contest to operating a $3 million Ponzi scheme. Moreland pleaded no contents to 21 counts of grand theft, 12 charges of elder financial abuse and one felony count of engaging in a pattern of theft conduct.

Alameda County Superior Court Judge Kevin Murphy heard the case and is waiting for a report on what happened to the money Moreland stole, which he promised his 20 clients/victims would be invested in real estate.

Read the full article in the Silicon Valley Mercury News.

© Copyright 2007-2018 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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