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Archive for January, 2014

Elk Grove Man Convicted in Real Estate Investment Fraud

January 30th, 2014 at 6:40pm

The man known as a “closer” among his fellow defendants was found guilty by a federal jury today a real estate investment fraud scheme that cost investors almost $37 million.

Christopher Jackson, 46, was part of a company known as Diversified Management Consultants, or DMC. Court documents indicated that between 2003 and 2009, DMC operated purportedly to help people save their homes from being foreclosed and also was a real estate investment company. Jackson’s company, Genesis Innovations, induced the 80 or so investors it recruited to invest over $10 million, whether from savings, IRAs or cash-out loans against their residential mortgages.

As with many failed real estate investments, some of the money was returned to earlier investors and other money was used to finance expensive cars, vacations and other luxury items. In Jackson’s case, only about 25% was actually spent on developing real estate.

U.S. District Judge Troy L. Nunley ordered Jackson remanded into custody immediately after the jury’s verdict. Jackson is to be sentenced April 10.

Jackson’s co-defendants, Michael Bolden, 60; Victor Alvarado, 52; Nicholo Arceo, 40; Erica Arceo, 45; and Garry Bradford, 65, all of Sacramento, previously pleaded guilty to charges of conspiracy, wire fraud and false statements and are waiting to be sentenced.

Read the original article in the Sacramento Bee.

 

 

Irvine Man Pleads Guilty to Mortgage Fraud in Sacramento-area Homes

January 30th, 2014 at 9:41am

An Irvine man faces up to 30 years in federal prison and a $1 million fine after pleading guilty to a federal grand jury indictment accusing him of mortgage fraud.

Alexander Romaniolis, 48, entered his plea to the mail-fraud charges, according to U.S. Attorney Benjamin B. Wagner.

The indictment alleged that Romaniolis provided lenders with false information about the financial status and assets of straw buyers in order to acquire eight homes in Roseville and Rocklin. All the homes were later foreclosed, causing losses to the lenders of over $2 million.

It is not know if the U.S. Attorney prosecuted any of the straw buyers.

Read the original article in the OC Weekly.

Attorneys and Others Arrested in Fresno Adverse Possession Scheme

January 30th, 2014 at 9:30am

According to a press release by the California Department of Justice, five individuals were arrested in mid-January and charged with allegedly running a statewide housing scheme by using adverse possession laws to fraudulently take control of at least 23 homes in nine counties,  Fresno, Kern, Los Angeles, Madera, Merced, Santa Barbara, San Mateo, Sonoma and Tulare.The

Sandra Elaine Barton, 30, Christopher Spencer Barton, 31, Daniel Paul Vedenoff, 29, Sheldon W. Feigel, 50, and Craig Merrill Mortensen, 60, all of Fresno, were arrested and charged with 288 felony counts including perjury, filing false court records and preparing false evidence. A sixth defendant, Cambria Lisa Barton, 21, turned herself in to authorities last week and entered a general time waiver.

Mortensen and Feigel are attorneys. According to the filing by the AG’s office, the non-attorneys were alleged to have identified abandoned homes and then filed for adverse possession with the courts in order to obtain title, after which the property would be sold or rented.

Under California law (Code of Civil Procedure 325), an individual can claim adverse possession of real property if he or she has occupied or claimed it continuously for at least five years and paid property taxes for that period of time, among other requirements.

The scheme unraveled when Nancy Zelepsky, the actual owner of a home in Santa Barbara County, contacted a title company to see if there were any liens against her property before applying for a home equity loan in 2010. The title company informed her that Sandra Barton was listed as the deed holder that same year and that the documents had been filed by Craig Mortensen.

Zelepsky received assistance from the Legal Aid Foundation of Santa Barbara County and her property was restored to her after the court found that Sandra Barton’s claim was fraudulent. The court then contacted the California State Bar regarding Craig Mortensen and the California Attorney General’s office opened its own investigation in June 2011.

If found guilty, the defendants all face long prison sentences.

The Attorney General’s Office was assisted in this case by the State Bar of California, Santa Barbara County District Attorney’s Office, Kern County Sheriff’s Department, Clovis Police Department and Fresno Police Department.

Following his arrest, Sheldon Feigel’s attorney held a press conference denying the charges filed against his client. He has since filed a lawsuit against the State of California seeking $1 million in damages for unreasonable search and seizure, being denied access to his attorney and for emotional distress inflicted on his children.

Read a copy of the felony complaint by clicking here.

Rare Prosecution of Short Sale Fraud in Northern California

January 24th, 2014 at 6:00am

A Fremont real estate agent was arrested this week after being indicted by a federal grand jury in connection with helping a man commit short sale fraud in the sale of his home.

Minerva Sanchez, 47, was arrested and arraigned in San Jose federal court, where she pleaded not guilty to conspiring to commit bank fraud.

In a case dating back to March 2010 in which authorities allege lender Tri Counties Bank and Freddie Mac collectively lost over $350,000 Sanchez represented Agustin Simon, 52, in the short sale of his home located in Patterson. Sanchez is accused of recommending that he use her son as a straw buyer to purchase the home in a short sale. The idea was that Simon would eventually take title back to his home.

Before a lender approves a short sale, the seller must submit a letter detailing financial hardship and both the seller and his agent must sign an “arm’s length” affidavit affirming the sale is to a buyer unrelated to the seller by relation, business or acquaintance. Prosecutors said both Simon and Sanchez fraudulently signed the arm’s-length affidavit and both misrepresented his ownership of other real estate assets. Simon allegedly had enough money that he was able to give $355,000 to Sanchez’ son to effect the purchase. Both lenders ultimately approved the short sale.

In addition to receiving commission for representing Simon, Minerva Sanchez also received 75% of the commission paid to her son’s real estate agent.

It is not known whether Sanchez’ son is being charged in this case.

In June 2013, Agustin Simon pleaded guilty to conspiring to commit bank fraud in connection.

Read the original article in the Modesto Bee.

You can learn everything about short sale fraud by reading my e-book “How to Commit Short Sale Fraud . . . and Get Away with It.”

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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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