Los Angeles Pair Sentenced For Filing Fraudulent Bankruptcy Petitions In Running "Fractional Interest" Deed Transfer Foreclosure Rescue Racket

From the Office of the U.S. Attorney (Topeka, Kansas):

• Two Los Angeles men have been sentenced for running a scam in which homeowners who were behind on their mortgage payments paid them to hold off foreclosure by filing fraudulent bankruptcy petitions. U.S. Attorney Lanny Welch announced [...] that Isaac Yass, 43, a citizen of Israel who has been living in Los Angeles, Calif., and Andrew Blechman, 40, Culver City, Calif., were sentenced on January 4, 2010, in United States District Court, Topeka, Kansas. Yass was sentenced to 60 months and Blechman was sentenced to 18 months in federal prison. A forfeiture order in the amount of $1,063,176.30 was entered against Yass and Blechman, jointly and severally.

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• During the trial, prosecutors presented evidence that Yass and Blechman conspired to operate a fraudulent service called Stopco claiming to be able to save homeowners who where behind on their mortgage payments from losing their homes.(1)

For the U.S. Attorney press release, see Los Angeles Men Sentenced For Filing False Claims In Kansas Bankruptcy Courts.

For a report issued by a California Federal Bankruptcy Court task force that details the types of foreclosure scams involving the abuse of the bankruptcy courts, see Final Report Of The Bankruptcy Foreclosure Scam Task Force (available online courtesy of the Loyola of Los Angeles Law Review).

Go here for other posts on fractional interest deed transfer, foreclosure rescue bankruptcy scams.

(1) According to the press release, evidence at trial showed that:

• Yass solicited homeowners who were going through foreclosure proceedings. He told them that for a fee he could help them keep their houses;
• Yass and Blechman filed fraudulent bankruptcy petitions in federal bankruptcy courts in Topeka, Wichita, and Kansas City, Kan. The petitions were filed in the name of nonexistent individuals with businesses that claimed to be part-owners of properties that were in foreclosure;
• The result was an automatic stay in the foreclosures, halting any further actions by creditors against the properties;
• The petitions contained false names and Social Security numbers, and addresses for the creditors that were in fact mailboxes or UPS Store locations in Kansas.