NJ Feds Bag Brooklyn-Based "Home Savers" Equity Stripping Foreclosure Rescue Racket; High Equity Homeowners Allegedly Conned w/ Bogus Sale Leasebacks

From the Newark, New Jersey Office of the FBI:

• It’s the type of story that is becoming increasingly more common: FBI Special Agent In Charge Weysan Dun announced [Wednesday] the arrests of GARTH CELESTINE, age 44, of [...] Brooklyn, New York; and PHIL A. SIMON, age, 34, of Brooklyn – both better known collectively as “Home Savers Consulting Corporation”. Both were arrested this morning at their residences without incident and charged with attempt and conspiracy to commit wire fraud in connection with a home foreclosure scheme.

• Celestine and Simon owned and operated Home Savers, which held itself out as a foreclosure rescue company, [...]. The company conducted business in both New York and New Jersey. According to the complaint, Celestine and Simon allegedly conspired with each other to defraud both homeowners facing foreclosure and mortgage lenders by making materially false representations and promises and causing wire transfers to perpetuate the scheme. A key aspect of the scheme was the targeted victims: homeowners with substantial equity in their homes who were facing foreclosure because of an inability to make the monthly payments.

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• [Another] victim-group consisted of the straw-buyers. Celestine and Simon allegedly recruited individuals with good credit scores to act as “buyers” of the homes facing foreclosure. This was accomplished by misrepresenting to the straw-buyers that they were helping the true owners to “save” their homes. [...] Celestine and Simon also allegedly applied to different lenders for multiple mortgages on the same properties at the same time to extract the maximum available equity from each property.

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• [T]he complaint charges that Celestine and Simon eventually failed to make the mortgage payments in nearly every case and caused the loans to default. In the end, Celestine and Simon caused lenders to fund more than $10 million worth of fraudulent loans and stole $1.5 million worth of equity from the properties.

For the entire FBI press release, see “Home Savers” and Misbehaviors! FBI Arrests Two in Foreclosure Scheme.

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