Hawaii Feds Bag Five Suspects In Another Alleged Sale Leaseback, Foreclosure Rescue Scam

In Hawaii, the Honolulu Advertiser reports:

• Five people(1) were arrested by the FBI yesterday in connection with an alleged foreclosure bailout scheme that took hundreds of thousands of dollars from local lenders and residents and cost some their homes.

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• According to court documents, those arrested promised to help struggling homeowners stave off foreclosure if the homeowners agreed to a "sham" sale. They allegedly told the owners they could remain in their homes and that their title would be returned to them after a set period of time. The scheme involved offering "straw purchasers" $12,000 to $15,000 per transaction to act as new title holders. But the proceeds were allegedly funneled into fake escrow accounts and the new loan would go into default. The amount of the new loan was more than the old loan and the properties went into foreclosure, according to court documents.

For more, see FBI arrests 5 in alleged mortgage fraud scheme (All plead not guilty in skimming of loan funds).

For the indictment, see U.S. v. Kalani, et al.

(1) Bobby W. Wood, owner of Asian Pacific Funding; Stephen Balino, owner of New Horizons Financial; Welton Kalani, owner of Accel Mortgage LLC; Carlton Yim, co-owner of Walter P. Yim and Associates; and Audra Palomares, a processor with Accel Mortgage LLC, are accused of multiple counts of mail fraud, wire fraud, money laundering, and making false statements on a loan application. All five pleaded not guilty.