(revised 1-14-08; added Case # 27)
Transactions involving foreclosure rescue arrangements have occasionally been the subject of criminal prosecutions. The cases involved (1) those taking upfront fees and/or ongoing periodic fees for services never performed, (2) those who acquired overleveraged homes with no equity who proceeded to pocket the rent from the home without paying on the existing mortgage (ie. equity skimming / rent skimming), and (3) those who engaged in the so-called foreclosure bailout, foreclosure rescue, equity stripping arrangements.
The following are links to stories involving the criminal prosecutions of foreclosure rescue operators:
Press Release - U.S. Department Of Justice - Three Defendants Added To Federal Indictment In Foreclosure Scam Targeting Homeowners In Default (7-20-06)
Defendants Face Prison Time for Calif. Foreclosure Scam
Seal Beach escrow operator pleads guilty in fraud case
Stipulated Statement of Facts (Cynthia Valenzuela) Plea Bargain Agreement
Let The Borrower Beware
Sentencing In S. California Foreclosure Rescue Scam Postponed To December (8-14-07)
Bond Revoked For Los Angeles Area Foreclosure Rescue Operator Facing Criminal Charges; Allegedly Engaged In More Stripping Scams While Awaiting Trial (12-2-07)
Case # 2 - Ohio Federal CourtPress Release - U.S. Department Of Justice - Springboro Man Indicted In "OperationTruth Or Consequences" National Action Against Bankruptcy Fraud (10-18-06)
Foreclosure scam triggers plea, (The Enquirer / Cincinnati.com - 11-8-07)
Chicago lawyers charged in bankruptcy fraud probe (10-18-06)
Press Release - U.S. Department of Justice - Five Chicago Area Bankruptcy Attorneys Among A Dozen Defendants Charged In Separate Federal Bankruptcy Fraud Cases (10-18-06)
Foreclosure case witnesses take fire (adapted from The Modesto Bee, 10-20-06)
California Judge Decides to Proceed to Trial in Matter of Accused "Deed Thieves", (blog post - 11-21-06),
California Prosecutors Add 26 Charges Against Alleged House Swindling Trio (blog post - 12-6-07)
Plea deal for men accused of fraud? (Prosecutor tells judge both sides talking in Ashlock-Buhler case) (The Modesto Bee - 8-3-07)
Plea Deal In The Works For Foreclosure Rescue Operators? (blog post - 8-3-07)
2 plead guilty to swindling homeowners (One year in jail, restitution for 20 families mark deal) (The Modesto Bee - 9-20-07)
Northern California Prosecutors Get "No Contest" Pleas In Foreclosure Rescue Scam (blog post - 9-24-07)
Lyndhurst, N.J., Men Get Sentenced for Defrauding Homeowners in Mortgage Scam (9-10-03)
Mortgage Scam Puts Dozens of Dallas Homeowners on the Streets (4-10-01)
Attorneys Arrested In Real Estate Scheme
Mortgage fraud scheme broken up
Press Release - U.S. Department of Justice - Tampa Federal Jury Convicts Five Persons In Home Equity / Bank Fraud Scheme (3-29-07)
Indictment - U.S. vs. Moumneh, et al.
Five convicted in home equity fraud
Florida Foreclosure Rescue Operators Found Guilty In Federal Fraud Trial
Sale Leaseback Recharacterization As Loan Results In Criminal Conviction
Browner v. Dist. of Columbia, 549 A.2d 1107 (D.C. 1988)
California Foreclosure Rescue, Equity Stripping Warning, Consultant Jailed
Foreclosure Rescue Scammer Pleads Guilty To Felony Theft
Sacramento Feds Get Guilty Pleas From Foreclosure Rescue Operator; Two Straw Borrowers
U.S. Attorney's Press Release
Indictment - U.S.A. vs. Christopher Craig, et al.
Plea Agreement - U.S.A. vs. Craig (see pages 13-14)
'Foreclosure specialist' pleads guilty to fraud
U.S. Attorney Press Release (5-10-07) - Local Mortgage Broker and Assistant Indicted for Bilking Homeowners.Foreclosure Rescue Operators Indicted By Minnesota Feds
Indictment - United States vs. Fiorito & Jerde
Prior Lake man pleads guilty in home equity schemes
Minnesota Foreclosure Rescue Scammer Cops Plea To Mail Fraud
California Foreclosure Rescue Operator Faces Felony Charges
Santa Cruz resident says her home was stolen in foreclosure scam
Real estate’s market crash ensnares guru (No-money-down leader in legal trouble)
Missouri Foreclosure Rescue Operator Facing Felony Theft Charge; Allegedly Cheated 80 Year Old Woman Out Of Home
Charge he fleeced friend in $270G real estate scam
NJ Man Facing Felonies In Equity Stripping, Straw Buyer Scam
Foreclosure rescue operator Nicholas D. McLeod, 31, of Gaithersburg, Maryland pleaded guilty to:
- felony theft,
- embezzlement, and
- prohibited activities while acting as a foreclosure consultant.
For more, see:
- Maryland Mortgage Consultant Cops Plea In Foreclosure Rescue Scam,
- Gaithersburg Man Admits to Equity-Skimming Scam.
Temporary Restraining Order issued in this case by the state court.
Woman gets 10 years for home sale scheme (San Antonio Express-News, 10-24-06)
For the continuation of this regularly updated post, see Criminal Prosecutions Of Foreclosure Rescue Operators, Refinancing Scams II.