Hawaii Feds Ring Up 2 More Guilty Pleas In Sale Leaseback Foreclosure Rescue Scam; Civil Case Continues As One Victim Seeks To Recover Property Title

The Honolulu Star Bulletin reports:

• The owners of a Honolulu mortgage brokerage firm pleaded guilty to fraud and money laundering yesterday in a scheme that used phony buyers to obtain loans to buy homes that were in foreclosure proceedings. Federal Magistrate Judge Barry Kurren set a Sept. 17 sentencing date for John Michael Dimitrion, 33, who pleaded guilty to three felony counts, and a Sept. 24 court appearance for his wife, Julie Ann Baldueza Dimitrion, 37, who pleaded guilty to two counts. Two employees of their company, Mortgage Alliance LLD, pleaded guilty previously. Assistant U.S. Attorney Clare Connors told Kurren that the fraud involving three homes occurred in July 2005. The defendants arranged for "straw buyers" who lied on applications that they intended to live in the houses.

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• Debbie Aurelio and her family, who signed over title of their home thinking they were refinancing, were in the courtroom to watch the Dimitrions plead guilty. "I feel better now that it came to a point where they know they cheated us," said Aurelio. "We want our house back." The family of seven continues to live in their Ewa Beach home of 10 years.

• The Aurelios filed a lawsuit against the Dimitrions, and "their suit thwarted their eviction," said Legal Aid Society [of Hawaii] attorney Russ Awakuni. "This family was smart enough to seek legal help," but the other two families had to leave their homes.

• But the title to the Aurelio home is still held by the straw buyer, and "there's not much the federal government can do about that. They will continue with the civil case because the title needs to be restored," Awakuni said.

For the story, see Husband and wife plead guilty to mortgage fraud.

For the indictment in this case, see U.S. v. Dimitrion.

See also: Beware Local Mortgage, Foreclosure Scams (Family Faced Eviction After Company Took Ownership Of Home).