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Archive for November, 2012

Hendrix Montecastro, Helen Pedrino Ponzi Scheme Goes to Trial

November 30th, 2012 at 10:03am

The long-awaited criminal trial of Hendrix Montecastro and his mother, Helen Pedrino, is finally underway, after a panel of jurors and four alternates was seated November 27.

Montecastro and Pedrino, who are representing themselves, are facing a staggering  317 counts relating to scamming 28 victims out of close to $30 million in a real estate investment fraud and Ponzi scheme.

Prosecutor, chief deputy district attorney Vicki Hightower from the San Bernardino District Attorney’s Office has the unenviable task of painting a picture of the massive amounts of evidence so that the jury can understand the charges. Thus far, she has shown the jury a poster with the alleged cast of persons, alleging that Montecastro and Pedrino were the chief architects and that Pedrino, a nurse, targeted church-goers and hospital employees (affinity fraud), using faith to get the former to reveal their financial details.

What should have raised eyebrows were the rules prospective investors were required to follow: commit to three years’ of investing, turn over control of their finances and ask no questions. In return, they would receive (literally) unbelievable returns of 300-700%.

Prosecutor Hightower is trying the case before Riverside County Superior Court Judge Jeffrey Prevost.

Read the original article in the Press Enterprise.

Update: Hendrix Montecastro has made his own opening statements, in which he responds to the prosecution’s opening by stating  “There’s no direct evidence” and that “I have God for my attorney” (the Jesus defense). Let’s see if the jury buys it, after they listen to the testimony of persons such as Deborah Weber, who, along with her husband, invested tens of thousands of dollars and lost all of it. You can read more about witness testimony and Montecastro’s defense by clicking here.

Note: James Benjamin DuncanMaurice McLeod, Cindi Gayle Kelly, Thuan Nhan Du and Charlie Choi have already entered pleas.

Interthinx Releases 2012 3rd Quarter Report on Mortgage Fraud Trends

November 30th, 2012 at 9:47am

Interthinx, a provider of risk-management data for the mortgage industry, has released it Mortgage Fraud Risk Report for data collected during the 3rd quarter of 2012.

Of note is that Florida has now surpassed Nevada as the riskiest state in the country in which to sell mortgages.

California is ranked #5; however, it represents “six of 10 riskiest MSAs” (Metropolitan Statistical Areas, a U.S. Census Bureau designation). Noteworthy to lending institutions, California has five of the 10 riskiest MSAs for Property Valuation Fraud Risk (appraisal fraud), and eight of the 10 riskiest MSAs for Employment/Income Fraud Risk (loan fraud). This, of course, is not good news for honest property owners in the neighborhoods in which these frauds are occurring.

The report also sites Merced, in central California, as “the riskiest metro in the nation.”


Orange County Woman Pleads Guilty in Mortgage Fraud after Withdrawing Earlier Guilty Plea

November 30th, 2012 at 9:29am

Having trouble making up your mind? So did Safieh Fard.

The former former owner of Belvedere Fine Jewelry on Via Oporto in Newport Beach  did something her sister and two of her sons did in 2011: she pleaded guilty in Santa Ana federal court to charges related to her family-operated mortgage fraud business. The 50-year old had previously withdrawn a guilty plea before sentencing by U.S. District Court Judge Cormac Carney.

In the end, Safieh Fard was convicted by a federal grand jury of one count of conspiracy to defraud the Internal Revenue Service (IRS) and one count of conspiracy to launder the proceeds of bank fraud obtained after submitting fraudulent mortgage applications.

According to a collaborative investigation by the U.S. Justice Department, IRS Criminal Investigation Division (IRS-CID) and U.S. Immigration and Customs Enforcement’s Homeland Security Investigations of Orange County, Fard, her sister Sedigheh Bahramian and Fard’s sons Mohsen Kikalaye andAhmad Kikalaye submitted fraudulent loan applications to banks in order to receive money to purchase beach-area properties which they would buy and flip. What was so brazen was that Safieh Fard claimed to earn over $40,000 per month while at the same time claiming no taxable income to the IRS.

Is anyone questioning why did the lenders failed to perform due diligence for eight years on somebody claiming to earn $40,000 a month?

The quartet further failed to report capital gains on the over $3.7 million they earned from selling the properties. Ahmad Kikalaye was the ultimate recipient of the funds and according to prosecutors made withdrawals under the federal $10,000 reporting requirement in order to escape scrutiny.

Sentencing for Safieh Fard is set for April 8, 2013 before Judge Carney.

Read the original article in OC Weekly.

US Attorney’s Office Gets Guilty Plea from Kaveh Vahedi in Mortgage Fraud Case

November 28th, 2012 at 11:37pm

The U.S. Attorney’s Office for the Central District of California has scored a victory in the fight against mortgage fraud and real estate investment fraud by obtaining guilty pleas from defendant Kaveh Vahedi, a former licensed mortgage broker and self-described real estate investor.

On November 26, the United States Attorney filed allegations, that from 1999 through 2008, Vahedi, 51, submitted more than 250 fraudulent loan applications to Countrywide Bank through his mortgage brokering firm KGV Investments, Inc., based in Glendale in Los Angeles County. Prosecutors alleged that Vahedia conspired to submit these applications to “Co-Schemer 1”, an employee at Countrywide, and paid cash for the services of “Co-Schemer 2”, a bookkeeper, to create fraudulent employement and other financial documents. Many of the loan applicants were instructed to sign blank loan applications, which were filled out by Kaveh Vahedi before being presented to “Co-Schemer 1.”

Among his victims was his own father: Vahedi posed as his father, without his father’s knowledge or permission, in order to take out a $493,000 home equity line of credit (HELOC) against the latter’s home. That’s in addition to the more than $200,000 he stole from his parents’ bank account.

The second count of the allegations charges that Kaveh Vahedi solicited people to invest their money with KGV Investments from 2005 through 2009 in what was found to be a Ponzi scheme. He told the investors their money would be used to purchase development projects in San Diego, China and Dubai, all of which was false. He gave them promissory notes guaranteeing a 50% rate of return within nine months. In fact, he paid his initial investors with money from earlier investors  and diverted much of the funds for his personal use, which included paying his mortgage, his leases on luxury cars, his son’s private school tuition. The 31 investor victims lost a total of approximately $8 million as a result.

Faced with the evidence presented in the United States Attorney’s allegation, Kaveh Vahedi signed a plea agreement on November 26 (the same date), agreeing to plead guilty to one count of bank fraud, one count of wire fraud and one count of conspiracy. He could face up to 55 years in prison and fines totaling $1.5 million when he is sentenced, although the U.S. Attorney, in exchange for the guilty pleas, is expected to seek imprisonment of 121 months, full restitution to the victims and other parties yet to be identified. United States District Judge Dean D. Pregerson will hear the guilty pleas.

Several of the investor-victims have sued Kaveh Vahedi in state court and won civil judgments against him.

No word on the fates of Co-Schemers 1 and 2, who have not been identified, or the persons who applied for loans knowing they were unqualified.

You can read a summary of the plea agreement on the U.S. Attorney’s Office Central District California website. The FBI and the Secret Service were the investigating agencies.

Senior Citizen Charged with Elder Theft in San Mateo

November 23rd, 2012 at 9:24am

A 71-year old Saratoga man who gained the trust of elderly clients by preparing their tax returns is now accused by the San Mateo District Attorney’s Office of ripping them off (elder financial abuse, elder financial fraud).

San Mateo police Sgt. Dave Norris said Lewis Lee was able to charm his clients into joining his investment club called Lewis E. Lee Company by allegedly telling them he was an accountant or financial advisory, although he did not possess any of the required licenses or certifications. His website was still up and running as of the date of this posting.

Lee has been charged with 11 counts of embezzlement, four counts of elder theft and a once residential burglary charge and will be prosecuted by District Attorney Steve Wagstaf in San Mateo County Superior Court beginning December 6.

Lee has hired attorney Chuck Smith, who has thus far defended Lee by saying his client was also a victim and thought his investments were legitimate.

Read the original article in the Contra Costa Times.

Owner of Paramount Group Found Guilty in Brazen Mortgage Fraud

November 23rd, 2012 at 9:11am

Brandon Hanly, 32, of Redding, who was indicted as part of a conspiracy to defraud banks (mortgage fraud, loan fraud) in order to skim equity using inflated appraisals (appraisal fraud) has been found guilty by a federal jury. The jury convicted Hanly, a formerly licensed real estate broker and principal of Paramount Group, of wire fraud, mail fraud and money laundering.

According to the US Attorney’s Office, which prosecuted the case, Hanly conspired with Douglas Heald, 32, and Jerald Maggi, during a 7-month period in 2005-2006 to defraud lending institutions. The indictment against the three accused them of altering appraisals and title documents so that they could receive $5 million in mortgage loans and an additional $1.5 million in cash out.

Douglas Heald and Jerald Maggi pleaded guilty before going to trial but Brandon Hanly took his chances and offered a defense of being a victim. Prosecutors proved to the jury that, however, that Hanly received $300,000 in proceeds, not much money if he receives the maximum sentence of 30 years in federal prison and $500,000 in penalties when he is sentenced in 2013.

The fourth participant was a Redding-based mortgage broker named Joshua Gervolstad, who in 2010 was sentenced to three years in prison and order to provide restitution of $1.4 million for controlling a shell company called TPG Investments Inc., which he used to distribute the ill-gotten proceeds.

Read the original article in the Redding publication Record Searchlight.

Australian Man Gets Prison for $5,000,000 Loan fraud

November 23rd, 2012 at 8:49am

An Australian man who admitted he conspired with convicted criminals  Henrik and Hamlet Sardariani to steal money from a bank (loan fraud) has been sentenced to four years in federal prison for his role in concealing the proceeds.

Christopher J. Woods, 53, of Sydney, pleaded guilty in November 2011 to conspiracy to commit money laundering and two counts of money laundering. He was sentenced by United States District Judge Virginia A. Phillips, who ordered the former jockey to pay $3,510,000 in restitution as well as a $10,000 fine.

The Sardariani brothers lied to the lender, contending the loan money was to extend an already-existing escrow and to purchase a hospital when in fact they never intended to repay the loan. The bank was lulled into feeling their investment was safe because of of the assurances of Wandy Tenney, an escrow officer. After the lender wire half of the funds to Tenney’s escrow company, Christopher Woods and Henrik Sardariani ordered her to wire $1.9 million to Sardariani’s Hong Kong account. Woods’ proceeds was an additional $1.9 million, which he had wired to an account in Los Angeles.

Henrik Sardariani was sentenced last August to 10 years in prison. His brother Hamlet received 6 1/2 years. Wanda Tenney will be sentenced by Judge Phillips in May 2013 after pleading guilty to conspiracy.

This fraud was investigated by the Federal Bureau of Investigation and the Internal Revenue Service-Criminal Investigation.

Read the original article in the Imperial Valley News and the press release by the US Attorney’s Office Central District of California. There are also four earlier articles posted on the California Real Estate Fraud Report about Henrik Sardariani, Hamlet Sardariani and Wanda Tenney.

Citrus Heights Man Charged for Lying about Home Value to Get HELOC

November 21st, 2012 at 3:26pm

An investigation by the Internal Revenue Service-Criminal Investigation and the Federal Bureau of Investigation has led to mortgage fraud charges against a Citrus Heights man.

Daniel Gherasim, 36, was indicted by a federal grand jury for bank fraud, false statements on a loan and credit application and money laundering. The charge relate to an application Gherasim made with a bank in order to get a home equity loan against a home he owned in Folsom. Prosecutors charge that he lied on his application about the amount of equity he had in the home (loan fraud, mortgage fraud).

The hearing was in front of U.S. Magistrate Dale A. Drozd.

Read the original article in the Sacramento Bee.


Pinole Police Commander Charged with Elder Financial Abuse against 80-Year Old Neighbor

November 21st, 2012 at 2:24pm

You just can’t trust anybody these days.

Jean Phyllis Jones, an 82-year old Pleasanton woman is possibly the victim of two of her neighbors.

Jones, who in court records is characterized as having “diminished mental capacity,” allowed her neighbor Matthew Messier, 36, to write her will and trust, appointed himself executor of her estate and made himself sole beneficiary of that estate. Messier was the second-in-command at the Pinole Police Department until he was charged with felonies relating to the alleged elder financial fraud (elder financial abuse) and arrested. His wife, Elizabeth Regalado, 30, is also being sought and will face a charge of conspiracy.

According to Pleasanton Detective Keith Batt, Messier represented himself to the notary as a police commander at the time the estate documents were signed. He told employees the same when he accompanied Jean Jones to the bank and spent many hours examining the contents of her safe deposit boxes, which included cash, gold and savings bonds. Jones’ home is also valued between $500,000 and $700,000, say the police.

Authorities were alerted to the possibility of elder financial abuse after the Alameda County Adult Protective Services agency received a report.

For his part, Matthew Messier has pleaded not guilty to charges of attempted grand theft, elder abuse, forgery, registering a fraudulent document, conspiracy and practicing law without a license and is in jail in Oakland in lieu of $322,500 bail.

Read the original article in the San Francisco Chronicle (SF Gate).

Real Estate Broker Charged in Ponzi Scheme

November 21st, 2012 at 1:59pm

Mario Alexander Hernandez, a licensed real estate broker whose office was in Harbor City, has been arrested and charged with ripping off $600,000 from three people.

According  to Detective Christopher Derry of the L.A. County Sheriff’s Department, Hernandez, 57, ran a business he called “OPM Capital Group,” as in “Other People’s Money.” He promised a married couple and another person that they would receive returns of 10-20% from the investments he would make from their 401(k) retirement accounts by investing in real estate and stocks and bonds. He knew what their assets were because he prepared their tax returns.

Investigators from the L.A. County Sheriff’s Department Real Estate Fraud Team determined that Hernandez made some real estate investments but used most of the money he received from his victims to pay his staff, to run his business, give loans and gifts to his family and friends and pay previous investors (Ponzi schemes). All in all the single person invested $60,000 and the couple trusted him with $540,000, which was their life’s savings. Not only did the three lose their investments, but the married couple lost their home to foreclosure and the husband has suffered medical and psychiatric problems from the trauma of his ordeal.

If you believe you are a victim, you can reach Detective Derry at 562-233-8204.

Read the original article in the Daily Breeze.

© 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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