Saturday, December 17, 2011

Head Of Long Island Straw Buyer Racket Gets 4-12 Years; Scam Involved Use Of Forged Deeds, Unwitting Homeowners Victimized By Identity Theft

In Nassau County, New York, the Long Island Press reports:

  • A Westbury man has been sentenced to four to 12 years in prison for leading a $20 million scheme in what authorities described as the largest mortgage fraud and identity theft ring in Nassau County history.

  • James Robert Sweet pleaded guilty at Nassau County court in October to enterprise corruption, grand larceny, money laundering, identity theft, scheme to defraud, conspiracy and falsifying business records. The 44-year-old was also ordered to pay more than $1.2 million in restitution to lending institutions.

  • Prosecutors said Sweet and Dwayne Benjamin, 44, also of Westbury, led 15 schemers who committed more than 45 fraudulent acts by stealing millions in property and mortgages over six years. Benjamin also pleaded guilty in October to related charges and will be sentenced Thursday.

  • Sweet and Benjamin ran a typical mortgage fraud scheme in which they recruited so-called straw buyers to purchase a houses and secure mortgages, then kept the money, never made payments on the loan and let the home go into foreclosure. Straw buyers were paid about $10,000 for each purchase, according to investigators.

  • Like similar scams that have been uncovered in recent years, the scheme involved and array of corrupt professionals. In this case they included lawyers, mortgage brokers, real estate brokers, bank employees, an appraiser, a financial consultant and a U.S. Postal worker.

  • In one of the fraudulent deals, the scammers “purchased” the same house twice in two weeks by exploiting a delay in filing paperwork in the county clerk’s office, stealing $390,000 in each instance.

  • Prosecutors said they took the scam one step further when they submitted forged deeds to Nassau County in order to rent out some of the involved houses to tenants who qualified for subsidies before the properties were foreclosed—stealing more than $80,000 from taxpayers.

  • To execute the overall scam, those involved stole the identities of multiple homeowners and an attorney.

Source: Westbury Man Sentenced for $20M Mortgage Fraud.

Denver Cops Pinch One, Look For Another In Title-Snatching Scam Targeting Vacant Homes In Foreclosure, Victimizing Unsuspecting Buyers, Renters

In Denver, Colorado, KMGH-TV Channel 7 reports:

  • A man accused of selling and renting homes he didn’t own was formally charged Monday. Alfonso Carrillo was accused of victimizing unsuspecting renters and buyers who are primarily Spanish-speaking.

  • He was charged with multiple counts of theft, forgery and offering a false instrument for recording -- all felonies.

  • Carriollo is accused of filing phony deeds on houses vacated through foreclosure, then gaining access and posing as the owner. The charges allege he took thousands of dollars in payments from unsuspecting potential home buyers and then gave them fraudulent deeds to properties.

  • The actual property owners were unaware the property had been "sold." The charges also allege that he targeted Spanish-speaking home buyers, often undocumented, who may be reluctant to work with law enforcement, out of fear.

  • Rudy Breda, 53, is also wanted in connection with the scam, accused of recording phony deeds with the Denver Clerk and Recorder’s Office. He is not in custody. Carrillo is scheduled to appear in Denver District Court on Jan. 6, 2012, for arraignment.

  • The investigation is continuing and there is concern that there may be additional victims, the District Attorney's Office said.

Source: Man Charged In Real Estate, Rental Scam (Second Man At Large).

Unwitting Would-Be Tenants Continue Falling For Foreclosure Rent Scams

In Rockwall County, Texas, WFAA-TV Channel 8 reports:

  • From the stockings to the Christmas tree, Kimberly Agee and her family planned to celebrate the holiday in their new home in Heath, but now their future is in limbo. "We are finally getting settled. We thought this was our big break," said Agee. "And then there's a knock on the door. It's the constable serving us with an eviction notice, and we've been only here two weeks at this point."

  • The family rented the home after responding to an ad on Craigslist. It turns out this home is a foreclosure. Fannie Mae, the owner, told News 8 it took over the property more than 50 days ago and that it was illegally rented out. They consider Agee to be the victim of a rental scheme, and the agency has launched an investigation.


  • Documents show that Agee, a single mother, signed a one-year lease with Dan Blackburn from Housmart Inc. The company's Web site indicates it specializes in helping families stop foreclosures. The Housmart operation is based out of a luxury high-rise on Victory Park Lane in downtown Dallas. We didn't find Blackburn there, but we reached him by phone.

  • Blackburn told News 8 that as far as he knew, the house was in litigation and couldn't comment any further. When we asked him if he had the authority to rent out the home, the call went silent. News 8 tried to contact Blackburn again, but our calls were not returned.

For the story, see Family searching for new home after alleged rental scheme.

For story update, see More families come forward in Rockwall rental scheme:

  • [D]ozens of viewers in the Dallas-Fort Worth area e-mailed News 8 after the initial report aired Sunday, Dec. 4, telling us they were in the same predicament and had no recourse.

  • Call the Dallas Police Swindle Unit if you did drop off any payments to the Victory Park Lane location where Housmart is located. Police can determine if this is a civil or criminal matter.

  • Theft by deception is a felony, if more than $1,500 was lost in a bogus transaction.

Court Boots Bulk Of Cleveland's Public Nuisance Suit Attempting To Hold Banksters Responsible For Peddling Subprime Loans

In Cleveland, Ohio, The Plain Dealer reports:

  • A Cuyahoga County judge has dismissed most of a 2008 public nuisance lawsuit Cleveland officials filed against 21 banks and mortgage companies in an attempt to punish them for bankrolling subprime loans.

  • The dismissal cuts off another avenue the city sought to collect millions of dollars in damages related to the foreclosure crisis. A similar suit was dismissed in July 2010 by the U.S. Circuit Court of Appeals in Cincinnati.

  • The lawsuit languished on Cuyahoga County Common Pleas Judge Brian J. Corrigan's docket for more than a year with no action taken until a Plain Dealer editor on Nov. 15 inquired about it.


  • But Corrigan left a portion of the city's lawsuit intact. Cleveland sought a claim that banks owe the city costs associated with the demolition of certain properties. This part of the suit will be heard in the future.

For more, see Common Pleas Court judge rejects most of Cleveland's suit against banks over subprime loans.

Friday, December 16, 2011

Suit: "Another Tale Of Bank Of America Cheating Its Customers" As Bankster Is Accused Of Putting Borrower Into Default w/ Unauthorized Escrow Account

In San Diego, California, Courthouse News Service reports:

  • Bank of America found a new way to illegally extract money from customers, according to a federal class action: deduct taxes and insurance from mortgage payments, even though the homebuyers make those payments themselves, then call the mortgage in default for the unauthorized deductions, and charge late fees and penalties.

  • Lead plaintiffs Rick and Susan Dolfo say that's what Bank of America did to them. "This is yet another tale of Bank of America cheating its customers," the complaint states.

    "In 2005, plaintiffs obtained a residential mortgage loan. Bank of America subsequently bought the servicing rights to the loan. From the time the loan was issued, plaintiffs complied with their obligations under the loan agreement. They made their monthly payments, maintained the required homeowner's insurance coverage and timely paid their property taxes. Nonetheless, in December 2009, plaintiffs noticed on their monthly mortgage statement that Bank of America paid their property taxes and homeowner's insurance without the plaintiffs' knowledge or consent, and even though plaintiffs also paid them. To fund the impound account, and without informing the plaintiffs, Bank of America took money from plaintiffs' monthly mortgage payment, not leaving enough to cover plaintiffs' monthly mortgage payment, throwing plaintiffs into default. Once in default, Bank of America, as the loan servicer, was able to charge additional fees and penalties. Bank of America also falsely reported to credit agencies that plaintiffs were in default on their mortgage."

  • The Dolfos say Bank of America had no authority to set up an impound account because they were already paying their insurance and taxes. [...] The Dolfos seek class damages and punitive damages for breach of contract, unfair competition, violation of the Rosenthal Fair Debt Collection Practices Act, violation of the Consumer Credit Reporting Agencies Act and conversion.

For more, see Class of Homebuyers Claims BofA Found a New Dirty Trick.

For the lawsuit, see Dolfo v. Bank of America, N.A., et ano.

Despite Having Valid Loan Mod In Place, Homeowner Nearly Loses Home To BofA Foreclosure; Bankster Halts Sale After Media Steps In, Shines Spotlight

In Rio Grande Valley, Texas, KRGV-TV Channel 5 reports:

  • A national bank admits its error almost cost a Valley family its home. The home loan modification program was supposed to make life easier. It was supposed to take away some of the financial burden. It did the opposite.


  • The Rodriguez family has lived here for nearly 20 years. They needed help paying the bills. They turned to Bank of America and a home loan modification program. The program allows homeowners to pay their mortgage at a reduced rate. They thought it would help.

  • "We got our payment back that they weren’t going to accept any more payments because the house was going to be foreclosed on," says Rodriguez. The bank told Rodriguez she owed almost $16,000.

  • Bank managers failed to realize the homeowner was put into the loan modification program. Rodriguez felt her back was against the wall. She called the bank to find out what was going on. Finally, things seemed to get straightened out.

  • "They even said, ‘Oh, miss, we do apologize. It was a mistake on our behalf. We'll go ahead and fix that mistake. Just to go ahead and continue making payments,’" says Rodriguez.

  • She still continued to get notices that she would lose her home. The bank gave her until this past Tuesday to make a full payment.


  • CHANNEL 5 NEWS contacted Bank of America to find out what was going on. This was their response:

    "We apologize to Ms. Martinez for the error we made in completing her modification. We had already stopped the foreclosure sale that was scheduled for earlier this week. We will work directly with her on the next steps."

For the story, see Error Almost Costs Valley Family Its Home.

Lawsuit: BofA Continues Harrassing Elderly Central Florida Couple After Foreclosing Over Payment Made Too Early

In New Port Richey, Florida, the St. Petersburg Times reports:

  • For the Bullingtons, dealing with Bank of America is like something out of Groundhog Day — without the happy ending.You may recall earlier scenes from their story: James Bullington, 78, is dying, which led to financial problems for the New Port Richey couple.

  • His wife, Sharon, sought to ease the financial pain by getting Bank of America to modify the terms of their mortgage. The bank agreed. Then it foreclosed after Sharon Bullington, 70, made a mortgage payment too early.

  • After stories appeared in August and September in the St. Petersburg Times, Bank of America apologized, restructured the loan and paid their legal fees. The Bullingtons have paid their payments since.

  • But Bank of America is still after them. Almost weekly, notices arrive. Phone calls too. The nation's second-largest bank wants them to modify their mortgage, the same one they've already modified. Each notice lists a different amount for what is owed.

  • With a terminally ill husband, Sharon Bullington has had a bellyful of Bank of America. "It's hurtful and upsetting and disgusting," she said, quivering on the telephone. "It's just terribly upsetting. We signed the modification."

  • Now, the couple has filed suit demanding the bank stop the harassment and stop contacting her. Bank of America did not respond to numerous requests for comment.

  • The couple's attorneys accused the bank of violating the Florida Consumer Collection Practices Act. The statute allows for damages of just $1,000 and attorney fees. "It's not about the money," said attorney Vincent LoBue of Yesner & Boss. "It's the principle. The bank shouldn't be contacting them. We represent them. The bank knows that."

  • Still, aside from the mailings and telephone calls seeking a new loan modification, Bank of America regularly sends the Bullingtons something else: payment notices for their recently modified mortgage. Sharon Bullington questions why the bank continues to hound them.

For more, see New Port Richey couple files harassment suit against Bank of America.

BofA Continues Attacks On Hapless Homeowners; Refuses To Honor Earlier-Granted Loan Modification To Widow After Hubby's Recent Death

In Phoenix, Arizona, KPHO-TV Channel 5 reports:

  • June Geffre lost her husband Tom to pancreatic cancer in November 2009. Months before he died, he applied for the Home Affordable Modification Program (HAMP). Geffre said a permanent modification was granted shortly after he passed away – but she's run into all sorts of problems because her dead husband never got to sign the papers.

  • "Here I was, paying every month (the amount the bank told me to pay), thinking I was OK and waiting for the OK that the loan would be approved in my name and everything," said Geffre. "Then they hit me in July saying, ‘We can't accept your money anymore.'"

  • She said bank representatives told her she was paying the wrong amount and was now in default. She was at her wit's end when ASU's Homeowner Advocacy Unit and other community agencies stepped in to help.

  • "Ms. Geffre sent at least five copies of the death certificate. It took that long for Bank of America to realize her husband was dead," said Alyson Vivattanapa, a student attorney with the Homeowner Advocacy Unit.

  • A foreclosure sale was scheduled for 10 a.m. Tuesday. "Federal law allows her to assume the mortgage so she can stay in her home," said Vivattanapa. Advocates got a temporary restraining order just in time, which will keep June in her home for another month while they hash this out in court.

  • "There's absolutely a great injustice," said Vivattanapa. "Bank of America should have accepted the HAMP agreement and let her stay in home."

  • "I don't have a whole heck of a lot, but what I do have I worked hard for," said Geffre. "What right do they have to do this to anybody?"

  • CBS 5 News contacted Bank of America for comment. A spokesperson responded via email, saying, "We are unable to comment on this case due to the pending litigation." Both sides are due back in court later this week.

Source: Widow: Bank won’t honor loan mod after husband dies.

Thursday, December 15, 2011

Imprisoned Bay State Con Man Answers New Fraud Charges Of Taking Property Owners' Cash In Real Estate Deals & Allowing Mortgages To Go Into Default

In Fall River, Massachusetts, The Herald News reports:

  • Joseph Pereira made another appearance in court Tuesday, doing what must be familiar by now: Getting arraigned. Pereira, 46, formerly of Rodman Street, was officially charged in Superior Court with two more counts of fraud. He was ordered held without bail — an academic point, since he is in prison, serving a three- to five-year sentence for fraud.

  • Pereira watched without expression as prosecutor James McKenna provided an outline of the two new charges to Judge Thomas F. McGuire Jr. While he was out on bail, McKenna said, Pereira met with two people to offer his services as a financial advisor.

  • He allegedly accepted $20,000 from a President Avenue resident, offering to take over payment of the man’s mortgage while negotiating a new mortgage at a lower interest rate. Pereira did not negotiate a new mortgage or pay the man’s mortgage with the money provided, according to McKenna. The man called police after learning from the bank that his home was facing foreclosure and reading in The Herald News that Pereira was going to jail for fraud, prosecutors report.

  • In the second case, a Fall River woman hired Pereira to help her manage the finances of a pizza restaurant and an apartment building she owned, prosecutors said. Pereira took cash from the woman but did not use it to pay her mortgages as promised, McKenna told the judge. “It resulted in a default on the property and the properties were sold at foreclosure,” McKenna said.

  • Pereira went to court on Sept. 30, 2010, and pleaded guilty to 15 separate charges of cheating and lying to friends and neighbors. He was sentenced to three to five years in state prison on that day.

  • He was later convicted of more larcenies, admitting that on two occasions he accepted money to complete the sale of cars he did not own. Pereira is under court order to repay all of the victims in his schemes.

  • Pereira has grown noticeably thinner during his time in prison. He did not speak during the arraignment, allowing his lawyer, Matthew Burke, to enter two pleas of not guilty on his behalf. The next court date is Dec. 27. It was scheduled as a conference for a possible plea deal.

Source: Con man Joseph Pereira arraigned on new fraud charges.

California AG Bags Pair, Seeks Extradition On Another As Criminal Prosecutions Of Alleged Loan Modification Rackets Continue Picking Up Steam

From the Office of the California Attorney General:

  • Attorney General Kamala D. Harris [] announced the arrests of two Southern California men who, under the guise of an attorney-backed loan modification company, collected more than $6 million from homeowners nationwide for services that were never performed.

  • Christopher Fox, 37, of Laguna Niguel and Curtis Melone (AKA Curtis Kubat), 37, of Huntington Beach were arrested Tuesday on 37 felony counts, including conspiracy, grand theft and unlawful collection of advance fees. They are being held at the Orange County Jail on $500,000 bail and will be arraigned [] in Orange County Superior Court.

  • Fox and Melone - along with King Harris III, 42, of St. Louis, Missouri - collected more than $6 million in up-front fees through Orange County- based Green Credit Solutions. The Attorney General's office will seek extradition of Harris, who currently faces federal mail and wire fraud charges in Missouri.


  • In June 2009, the Attorney General's office launched an investigation of Orange County- based Green Credit Solutions - later renamed Guardian Credit Services and Get My Credit Grade - in response to numerous consumer complaints filed with the office, as well as with the Better Business Bureau, the California Department of Real Estate and the State Bar of California.

  • Through witness interviews, analysis of the company's marketing materials, and its business and financial records, DOJ investigators uncovered a scheme in which thousands of victims paid $3,500 for what they believed were attorney-backed loan modification services to reduce their interest rates, monthly payments or principal balance.

  • From November 2008 to October 2009, Fox, Melone and Harris collected more than $6 million from thousands of homeowners across California and nationwide. Victims were told their funds would be held in a so-called "attorney escrow account" until services were completed.

  • In fact, those fees were often deposited into the account of a disbarred attorney and then promptly transferred to GCS. Likewise, the company fraudulently claimed that loan modification services would be performed by attorneys; Harris is a disbarred Tennessee attorney and marketing materials referred to his alleged partners at the defunct law firm of "Smith Harris PLLC."

For the California AG press release, see Attorney General Kamala D. Harris Announces Arrests in Nationwide $6 Million Loan Modification Scams.

For the criminal complaint, see People v. Fox, et al.

Sacramento Feds Indict Five In Upfront Fee, Fractional Interest Deed Transfer Foreclosure Rescue Racket Employing Abuse Of Bankruptcy Courts

From the Office of the U.S. Attorney (Sacramento, California):

  • United States Attorney Benjamin B. Wagner announced that five persons had been charged in a federal indictment, [...] in connection with a foreclosure rescue scheme. The five defendants, Jewel L. Hinkles aka Cydney Sanchez, 61, of Los Angeles; Bernadette Guidry, 43, of Irvine; Jesse Wheeler, 34, of Roseville; Cynthia Corn, 58, of Oakland; and Brent Medearis, 45, of Modesto; were charged in an indictment returned by a federal grand jury on December 1, 2011. Hinkles and Guidry are charged with eight counts of mail fraud. Each of the defendants except Guidry is charged with 16 counts of bankruptcy fraud.(1)


  • The defendants allegedly told homeowners that for a substantial up-front payment and a monthly fee they would save the homeowners’ residences from foreclosure by arranging for investors to purchase their existing mortgage at a discounted price, or would reduce the homeowners’ monthly payment by negotiating a mortgage reduction with the lender.

  • The indictment alleges that contrary to the defendants’ representations, they failed to arrange for the purchase of clients’ mortgages or to negotiate reductions in the mortgage debt owed by clients.

  • To prevent foreclosure and defraud the existing lenders, the indictment alleges that the defendants filed fraudulent deeds transferring an interest in the homeowner’s property to a fictitious entity called Pacifica Group 49/II.

  • In many instances, the defendants also filed fraudulent petitions in bankruptcy court, often naming both the homeowner and Pacifica Group 49/II as the debtor. The purpose of these petitions was to invoke the automatic provisions of federal bankruptcy law that bring to an immediate halt any foreclosure actions against a debtor’s property.(2)

  • The fraudulent deeds and bankruptcy petitions delayed foreclosure proceedings, during which the defendants collected fees from defrauded homeowners. The indictment alleges that the defendants collected at least $5 million in fees from more than 1,000 clients.

For the U.S. Attorney press release, see Five Defendants Charged In Foreclosure Rescue Scheme.

(1) According to court documents, Hinkles was the founder and general manager of Horizon Property Holdings LC, located in Beverly Hills. From 2008 through 2010, Hinkles offered to the public a service called the “Save My Home” or “Homesaver” program that promised to rescue financially distressed homeowners from foreclosure and reduce the principal on homeowners’ mortgages. Guidry was Horizon’s office manager and assisted Hinkles with promoting the foreclosure and “principal reduction” program. Horizon offered its program directly to clients and also through several layers of “affiliates,” who promoted and sold the program to clients, mostly in Northern California. These affiliates included Property Relief!, operated by defendant Cynthia Corn in South San Francisco, and JW Financial Solutions, operated by defendant Jesse Wheeler in Roseville. Defendant Brent Medearis sold the program out of Modesto as an affiliate of Property Relief!.

(2) See Final Report Of The Bankruptcy Foreclosure Scam Task Force for a discussion of fractional interest deed transfer scams and other foreclosure rescue rackets involving the abuse of the bankruptcy courts.

HAMP Paperwork-Processing Scams Pick Up Speed As Bogus 'Experts' Come Out Of The Woodwork To Grab Cash From Unwitting Homeowners

The New York Post reports:

  • Once again, mortgage servicers are hitting ordinary New York homeowners where it hurts. The latest evidence is widespread scams tied to the Home Affordable Modification Program, or HAMP, which was supposed to help up to 4 million troubled borrowers avoid foreclosure.

  • Servicers, which manage loans day to day, have collected a cool $666 million from the government for participating in HAMP. Too bad servicers make the HAMP application process so difficult for the ordinary homeowner, they’ve opened the door to bogus “experts” who claim to help — for a big fee.

  • These cons are so out of control, the Office of the Special Inspector General of the Troubled Asset Relief Program (SIGTARP), the Department of the Treasury, and the Consumer Financial Protection Bureau have launched a new initiative to prevent HAMP scams at


  • The typical fraud works like this. A scam artist advertises online, pretending to be affiliated with the government. The scammers charge New Yorkers an average of $4,500 upfront, do no work, then skip out with the cash. Some borrowers are even losing their homes as a result of scammers’ advice to ignore foreclosure notices.


  • Long Island’s Nassau County is a hotbed of HAMP scams. Some scammers are former mortgage brokers and real estate executives, while others have ties to the mob.

For more, see Feds target HAMP scammers bilking owners.

Wednesday, December 14, 2011

POA-Holding Woman Said To Have Known Or Wilfully Closed Eyes To Dementia-Suffering Senior's Capacity In Misusing Loot From $2.25M Sale Of Property

In Brisbane, Australia, The Courier Mail reports:

  • A LOGAN City Council councillor has admitted she knew a dementia patient did not have the legal capacity to know what was happening when she transferred a "vast amount" of money out of their joint account into her own.

  • However, Hanjal Black said that, although she made the admission, she was carrying out the long held wishes of the 66-year-old man in a manner he had made it clear for a decade he wanted her to act.

  • In the Supreme Court in Brisbane, the Public Trustee of Queensland had asked for a summary judgment declaring the money should have been held on trust by Mrs Black for the elderly man because he lacked capacity to administer it.

  • Mrs Black had power of attorney for the man from April 2009 but it has since been suspended. The court heard in a legal document in which admissions were made, Mrs Black admitted she knew the man lacked necessary capacity at the time of the transfer of money on October 28, 2009.

  • David Jackson, QC, for the trustee, submitted that because of Mrs Black's admission and the manner in which she acted the trustee should get the summary declaration. The trustee believed Mrs Black knew or wilfully closed her eyes to the capacity of the man at the time of the transaction.

  • Mrs Black, who represented herself after her previous lawyers withdrew, argued there were issues which should be determined by a full hearing of evidence and cross-examination.

  • The Public Trustee has alleged Mrs Black misused funds from the $2.25 million sale of the man's property at Park Ridge. She has also lodged a civil matter counter-claim against the Public Trustee, seeking the man's home at Greenbank be signed over to her.

  • It is alleged Mrs Black and the elderly man established a joint bank account where the money was eventually placed, and it is also alleged she then transferred most of it into her own account.

  • In the Supreme Court [], Mr Jackson said the Public Trustee argued the transfer of the money had been a "conflict transaction". He said the trustee was not saying the man lacked capacity when giving power of attorney in April 2009, but rather it was about the man's capacity at October 2009 when the transaction was made.

  • Mrs Black told the court she had been like a daughter to the man and her family was the only family he had. She said she had acted in a manner which the man had made clear he wished her to undertake over a decade.

For more, see Hajnal Black admits elderly friend did not fully understand transfer of $1.5m into her account.

Boston Feds: Closing Attorney Snatched $3M+ In Real Estate Escrow Cash, Failing To Pay Off Existing Mortgages

From the Office of the U.S. Attorney (Boston, Massachusetts):

  • A Fairhaven attorney with an office in Taunton was charged [] in federal court with diverting mortgage loan funds from real estate closings. Craig J. Martin, 53, of Taunton, was charged in an Information with two counts of bank fraud.

  • The Information alleges that Martin, in acting as a closing attorney for real estate transactions, received mortgage loan funds from lenders, which were to be held in his attorney trust account and used for the closings.

  • As closing attorney, Martin was responsible for using the loan proceeds to pay off the existing mortgages on the properties. But instead of paying off the existing mortgages, Martin diverted at least $3,005,445 in mortgage funds to other purposes and falsified the loan closing documents to conceal his misappropriation of the funds.

For the U.S. Attorney press release, see Fairhaven Attorney Charged with Fraud in Real Estate Closings.

Feds Grab Fugitive After Int'l Manhunt; Suspect Accused Of Abusing POA By Putting Disabled Man's Home, Cash Into Her Name After Victim Suffered Stroke

In Upper Gwynedd Pennsylvania, Montgomery News reports:

  • It was Thanksgiving dinner behind bars for an Upper Gwynedd woman who allegedly stole more than $300,000 from a disabled Hatfield man now that the international manhunt for her has ended.

  • Janet Gitney, 57, of the 700 block of Brian Way, was apprehended [...] at JFK International Airport in New York and immediately taken into federal custody, according to Montgomery County District Attorney Risa Vetri Ferman and Hatfield Township Police Chief Mark Toomey. Gitney had arrived at the airport from the Philippines, according to authorities.

  • On Sept. 26, Gitney was charged with theft by unlawful taking or disposition, securing execution of documents by deception, theft by deception, receiving stolen property and failure to make required disposition of funds received in connection with alleged incidents that occurred between January 2009 and July 2011, according to court papers.

  • Gitney, authorities alleged, utilized her power of attorney over the victim to unlawfully take control of the man’s bank accounts and even the residence he owned by having it transferred to her name without the man’s consent or authorization.

  • Gitney allegedly fled to the Philippines and Korea while she was under investigation for stealing about $100,000 in retirement funds and $222,334 in property from the disabled Hatfield man. Gitney’s passport and flight records indicated she was to return to the U.S on Oct. 14 and she failed to do so, prosecutors previously revealed.


  • On June 10, Gitney transferred the Hatfield property “from the victim to herself for no consideration,” [Montgomery County Assistant District Attorney Tracey] Potere alleged in court papers.

  • At the time of the transfer, the victim was in a Lansdale area hospital after suffering another stroke in early June, court papers alleged. After the transfer of the property was completed, Gitney, as the victim’s power of attorney, arranged for the victim to be placed in a state run nursing home in Bucks County, authorities alleged.

For more, see Upper Gwynedd woman charged in $300K theft nabbed after international manhunt.

Nephew Returns To Great Britain To Face Sentencing After Abusing POA To Rip Off 93-Year Old, Dementia-Suffering Aunt Out Of Home, Cash

In Scarborough, United Kingdom, the Scarborough Evening News reports:

  • A 93-YEAR-OLD Scarborough woman was left almost destitute and reliant on the taxpayer for her care after her nephew drained her finances of £76,000, a court heard.

  • Dementia sufferer Joan Gregory moved into the St Celia’s Residential Home in Scarborough and her affairs put in the hands of her only living relative, Peter Boden.

  • However, York Crown Court heard that Boden, 63, drained her savings and attempted to sell her Scarborough flat in order to support his life in Spain.

  • Boden, who voluntarily returned to England and handed himself into the authorities with little more than £2,000 to his name, appeared for sentencing on one charge of fraud and three of theft.

  • Allan Ambrister, prosecuting, told how Boden, who has no fixed abode in this country, was granted Power of Attorney for his aunt’s finances and, over a period of time between 2008 and 2010 he moved £46,000 into his own accounts. The court heard that Boden then offered to sell Miss Gregory’s Scarborough flat to a West Yorkshire family who already owned several properties in the same block.

  • He came to an agreement with the couple to sell them the flat for £75,000. The couple paid a £25,000 cash deposit and made some of the £2,000 agreed monthly payments towards the sale price before the facts of what was going on came to light.

  • Boden had been legally advised that all monies from the flat sale should be paid into Miss Gregory’s accounts, but none ever was and all but a small amount of St Celia’s fees ever paid – the debt for her care running up to over £8,000.

For more, see Man drained aunt of £76,000 savings.

Tuesday, December 13, 2011

Florida Supremes Send Shivers Thru Bankster Community; Kibosh Sneaky Effort To Buy Out Of Robosigning Litigation By Settling Case With Homeowner

In Tallahassee, Florida, Sunshine Slate reports:

  • In a split ruling likely to send shivers through the mortgage banking community, the Florida Supreme Court ruled Thursday that it will hear a case involving alleged “robo-signing” by a major mortgage lender even though parties in the individual case settled and asked that the case be dismissed.

  • In a 4-3 ruling, the state’s highest court said it will take up a case pitting a Palm Beach County homeowner against the Bank of New York Mellon even though the parties in July asked that the case be dropped.

  • The bank began foreclosure proceedings against homeowner Roman Pino, who filed a lawsuit contending that the bank had illegally back-dated documents in his case. In response, the bank dismissed its foreclosure proceeding. Pino’s lawyers contend the bank did so to avoid having to address the allegations of fraud.

  • The Fourth District Court of Appeal, ruled in favor of BNY Mellon’s motion to dismiss, but asked the state Supreme Court to review the case becausemany, many mortgage foreclosures appear tainted with suspect documents.”

  • In a group opinion, the majority on Thursday ruled that the issue was too important to allow it to be dropped, agreeing with the 4th DCA that the case, “may dramatically affect the mortgage foreclosure crisis in this State.”(1)

  • In dissent, Chief Justice Charles Canady said the court was overstepping its bounds by forcing them to continue their legal battle. “The parties to this proceeding have rights,” Canady wrote in a dissent joined by justices, Ricky Polston and Peggy Quince.

  • Justice Charles Canady wrote in a dissenting opinion. “They should not be dragooned into litigating a matter that is no longer in controversy between them simply because this Court determines that an issue needs to be decided.”

Source: Supremes: The “Robo-Signing” Show Must Go On.

See also, The Palm Beach Post: Florida Supreme Court will rule on Palm Beach County foreclosure case involving allegedly fraudulent bank documents.

For the ruling, see Pino v. Bank of New York, No. SC11-697 (December 8, 2011).

(1) In justifying proceeding forward with the case despite it having already settled, the majority expalined why it couldn't allow this case top escape their scrutiny, and then proceeded to cite Florida precedent for its authority to disregard the wishes of the parties to dismiss the case (bold text is my emphasis):

  • The issue we address is whether Florida Rule of Appellate Procedure 9.350 requires this Court to dismiss a case after we have accepted jurisdiction based on a question certified to be one of great public importance and after the petitioner has filed his initial brief on the merits.[1]

    This narrow question arose after the parties to this action filed a joint Stipulated Dismissal, which advised that they had settled this matter and stipulated to the dismissal of the review proceeding pending before this Court.

    It cannot be questioned that our well-established precedent authorizes this Court to exercise its discretion to deny the requested dismissal of a review proceeding, even where both parties to the action agree to the dismissal in light of an agreed-upon settlement.

    The question certified to us by the Fourth District Court of Appeal in this case transcends the individual parties to this action because it has the potential to impact the mortgage foreclosure crisis throughout this state and is one on which Florida's trial courts and litigants need guidance.

    The legal issue also has implications beyond mortgage foreclosure actions. Because we agree with the Fourth District that this issue is indeed one of great public importance and in need of resolution by this Court, we deny the parties' request to dismiss this proceeding.


  • The language of [Fla. R. App. P. 9.350(a)-(b)] does not impose upon the appellate court a mandatory obligation to dismiss a case following the filing of a notice of dismissal before a decision on the merits has been rendered.

    Rather, this Court has long recognized its discretion to retain jurisdiction over a matter and proceed with an appeal notwithstanding a litigant's timely filing of a notice of dismissal pursuant to rule 9.350, especially when the matter involves one of great public importance and is likely to recur. See Gregory v. Rice,
    727 So.2d 251, 252 n.1 (Fla. 1999) ("Mootness does not destroy this Court's jurisdiction when the questions raised are of great public importance or are likely to recur.").

    For example, in Holly v. Auld,
    450 So.2d 217 (Fla. 1984), this Court addressed the merits of a question certified to be of great public importance even after the respondent settled with the petitioners and the respondent's attorney filed a suggestion of mootness with this Court. Id. at 218 n.1. Notably, the respondent's attorney never filed a brief in opposition. Id. at 221 (Ehrlich, J., dissenting). Framing the issue as one of mootness, the Court stated that "[i]t [was] well settled that mootness does not destroy an appellate court's jurisdiction . . . when the questions raised are of great public importance or are likely to recur." Id. at 218 n.1 (majority opinion) (citing Pace v. King, 38 So.2d 823 (Fla. 1949); Tau Alpha Holding Corp. v. Bd. of Adjustments, 171 So. 819 (Fla. 1937)).

    Given that the district court properly certified its question as one of great public importance, and noting that the situation at issue would occur again, this Court retained jurisdiction and addressed the merits of the case despite the parties' settlement of the matter. Id.Similarly, in State v. Schopp,
    653 So.2d 1016 (Fla. 1995), this Court held that "[e]ven where a notice of voluntary dismissal is timely filed, a reviewing court has discretion to retain jurisdiction and proceed with the appeal." Id. at 1018.

    We expressly rejected the appellant's argument that since his rule 9.350(b) notice of voluntary dismissal was filed before the district court of appeal's decision became final, his appeal had to be dismissed as a matter of right. Id. Importantly, we noted this Court's power to retain jurisdiction where the case presents a question of public importance. Id.

    In yet another instance, this Court in Bell v. U.S.B. Acquisition Co.,
    734 So.2d 403 (Fla. 1999), ruled upon an issue of great public importance even after noting that the parties had settled their claims and filed a joint stipulation of dismissal in this Court. Id. at 405 n.1. Deciding the merits of the case notwithstanding the parties' settlement and joint stipulation of dismissal, this Court held: "As we have done in the past, we exercise our discretion to retain jurisdiction in this case because we consider this issue to be of great public importance." Id.; see also Enter. Leasing Co. v. Almon, 559 So.2d 214, 215 n.* (Fla. 1990) (retaining jurisdiction in order to resolve the conflict issue presented after the parties settled and stipulated to the dismissal of the case prior to the scheduled oral argument); Ervin v. Capital Weekly Post, Inc., 97 So.2d 464, 466 (Fla. 1957) (retaining jurisdiction to consider issue of public importance where appellees sought dismissal prior to initial decision).3

    In the present case, it is true that the parties have filed a notice of stipulated dismissal pursuant to rule 9.350 notifying this Court that this matter has been settled. Although the issues underlying this litigation may be moot as to the parties involved, our precedent clearly establishes that mootness does not defeat appellate jurisdiction, and a reviewing court has the discretion to retain jurisdiction over a case to decide the merits notwithstanding a notice of dismissal filed by the parties denoting a settlement of their dispute.

    At issue in this case is whether the plaintiff in a mortgage foreclosure action (here, BNY Mellon) may be subject to sanctions for filing what is alleged to be a fraudulent assignment of mortgage where the plaintiff filed a notice of voluntary dismissal before the trial court had the opportunity to rule on the motion for sanctions. As reflected above, the Fourth District certified this issue to be one of great public importance, and in doing so, noted that "many, many mortgage foreclosures appear tainted with suspect documents" and that Pino's requested remedy, if imposed, "may dramatically affect the mortgage foreclosure crisis in this State." Pino, 57 So. 3d at 954-55.

    The issue also has broader implications and presents questions outside of the mortgage-foreclosure context. Moreover, Pino, the petitioner to the instant review proceeding, has already filed his initial brief on the merits in this Court.Consistent with the rationale undergirding our prior precedent, we conclude that these circumstances fully support this Court's decision to exercise its discretion to retain jurisdiction over and decide the merits of this important case.

    To adopt the dissent's interpretation of rule 9.350(a)—that the act of the parties' stipulation for dismissal is binding on the Court—would require us to recede from our past decisions recognizing just the opposite. Instead, we adhere to our precedent and, accordingly, exercise our discretion to deny the parties leave to dismiss this review proceeding.

Foreclosure Rescue Scammer Convicted On State Charges Now Chased By Feds For Running Same Racket While Being Prosecuted In Earlier Case

In Northern California, The Modesto Bee reports:

  • Facing foreclosure, a Turlock homeowner two weeks ago signed over part interest in his property to a man who promised to save the family home.

  • The owner didn't want to talk about it Thursday in a brief telephone conversation. Chances are, he didn't know that his would-be savior was convicted of fraud only three weeks before the transaction while out of custody to await sentencing in state prison.

  • Now federal authorities are after Alan David Tikal, whose collaborators — including unidentified agents in Stanislaus County — preyed on at least 590 mortgage reduction victims with more than $201 million at stake, according to an affidavit released Thursday to The Bee.

  • "The scheme continued to operate while Tikal was incarcerated and after his release," Special Agent Joseph Camillucci says in the document. He works for President Barack Obama's Troubled Asset Relief Program and apparently continued to track Tikal's companies after his February arrest on a grand jury indictment from Alameda County.

  • Tikal's attorney in the state case, Fanya Young, could not be reached Thursday. Tikal and his KATN Trust appeared to have dealings with at least 20 families in Stanislaus County detected by The Bee through property records earlier this year. But he was charged only in Alameda County and remained in custody until pleading no contest on Halloween to two felony counts.

  • His plea deal would net a 16-month term in state prison; the prosecutor in that case has said a judge could impose a three-year, eight-month sentence if Tikal fails to appear at a sentencing scheduled for Dec. 21.

  • Previously based in Las Vegas, Tikal and his wife moved to Brentwood in Contra Costa County, where she and others continued the scheme, the affidavit says. Federal agents served search warrants Wednesday on their house, which doubles as an office, a TARP spokesman in Washington, D.C., said.

  • Federal authorities believe Tikal and his associates engage in mail and bank fraud — bread-and-butter offenses opening a door for federal prosecution.


  • A webinar observed by The Bee suggested Tikal relied on a "vapor money" theory, telling homeowners they could get out of traditional loans because the government backs banks with "vague promises" and not gold. He told customers he was a private banker with "access to enormous lines of credit in the banking industry."

For more, see Released mortgage fraudster re-offends (Turlock homeowner among his new victims).

Feds Indict Trio In Alleged South Florida Sale Leaseback Equity Stripping Racket

From the U.S. Department of Justice:

  • Lisa Wright, 46, and Cathy Saffer, 52, of Pompano Beach, Fla., were charged [] with a conspiracy to defraud homeowners and banks in a foreclosure rescue scheme, announced the Department of Justice. Also charged was Barrington Coombs, 57, a certified public accountant of Weston, Fla., who participated in the scheme.

  • A federal grand jury in the Southern District of Florida returned an indictment charging Wright and Saffer with one count of conspiracy, three counts of mail fraud and three counts of wire fraud. The grand jury charged Coombs with one count of conspiracy and one count of wire fraud.

  • The indictment states that Wright and Saffer operated an alleged business called Foreclosure Solution Specialists (FSS) from 2006 to 2009. Through FSS, Wright and Saffer allegedly targeted homeowners facing foreclosure, advertising that FSS could assist those homeowners in remaining in their homes.

  • According to the indictment, when contacted by distressed homeowners seeking assistance, Wright and Saffer misrepresented to those homeowners that their homes would be sold to investors. Wright and Saffer also allegedly claimed that customers could remain in their homes after the sales and promised them an opportunity to repurchase the homes at a later date.

  • According to the indictment, rather than selling the homes to legitimate investors, Wright and Saffer designed sham sales to straw purchasers whom they paid to participate in the scheme.


  • According to the indictment, these sham sales drew equity out of the homes, which Wright and Saffer pocketed for their own purposes. After doing so, Wright and Saffer allowed the loans to go into foreclosure. Homeowners ultimately lost all of the equity in their homes, and most of the victims were forced to move out of their homes.

For the Justice Department press release, see Three Charged with Fraud in Florida Foreclosure Rescue Scheme.

Elderly Widow Tricked Into Signing Over Deed To Home Dies As Legal Battle To Recover Title, Possession Of Premises Remains Unresolved

In New Port Richey, Florida, the St. Petersburg Times reports:

  • On the last day Eloise Mudway was alive, she still worried about being mistreated and alone. "You're not going to throw me out, are you?" the 94-year-old widow asked her caretaker, Jeff Kores, from her hospice bed. "No, honey," Kores said. "We love you. You're not going anywhere.""Oh, good," she said.

  • Mudway died Wednesday (Nov. 30, 2011), broke and still mired in a legal battle with the couple convicted of stealing her home and draining her bank accounts.

  • Joseph and Cynthia Clancy were arrested in 2005 on charges of tricking Mudway into signing over the deed to her Hilltop Drive home in New Port Richey. Mudway also told investigators the Clancys, then her live-in caregivers, stole her dead husband's diamond ring, fed her only bologna and pickle loaf sandwiches and made her do laundry for them.

  • "I stayed in my room most of the time," Mudway testified at the Clancys' trial in 2009. "I was not allowed to have company. It was like I was in prison."

  • Joseph Clancy, now 58, and Cynthia Clancy, 49, were convicted of grand theft of a person 65 or older and were sentenced to 10 years in prison.

  • A judge ordered the house be returned to Mudway, but the property is still tied up in a civil lawsuit winding its way through the court system. That prevented Mudway from living in the house or selling it to recoup some of her lost funds.(1) She spent her remaining years with Kores and his family on a $1,200 monthly Social Security check.

  • Until her death, she kept asking when they could move back into her old house. "The sad thing is that nothing is resolved," said Kores, who said his own home is in foreclosure because of thousands of dollars spent in legal bills he accumulated fighting for Mudway.

  • Even from prison, the Clancys have fought to keep the home they say Mudway willingly signed over to them.


  • Kores said he now has to get a probate attorney to represent Mudway's estate in the civil suit over her assets. He feels overwhelmed and sad and frustrated.

  • He's trying to gather enough money to get Mudway cremated. She wanted her ashes spread over her mother and stepfather's graves in St. Petersburg. He plans to abide by her wishes. "We were hoping it was over with when they went to prison," Kores said. "No way. ... They won. "She never saw a dime."

For more, see Pasco woman dies, but fight over her home goes on.

(1) One may wonder why the homeowner/victim of this ripoff couldn't recover title and possession of her home shortly after the successful completion of the criminal prosecution of the scammers. After all, if the ripoff of the title to the homeowner's residence was perpetrated as a result of an act that is determined to be a crime, it is at least arguable that any contract or real estate conveyance founded upon such act is absolutely void. The case law, at least in the State of Florida, appears to support this view, as the Florida Supreme Court appears to make pretty clear in one case. See:

  • Town of Boca Raton v. Raulerson, 146 So. 576, 577 (Fla. 1933):

    where a statute pronounces a penalty for an act, a contract founded upon such act is void, although the statute does not pronounce it void or expressly prohibit it."

See also:

Chen v. Whitney National Bank, 65 So. 3d 1170 (Fla. App. 1st DCA, July 22, 2011) ([alteration added] - not in the original text):

  • [T]he Florida Supreme Court has expressed that "where a statute pronounces a penalty for an act, a contract founded upon such act is void, although the statute does not pronounce it void or expressly prohibit it." Town of Boca Raton v. Raulerson, 146 So. 576, 577 (Fla. 1933).

Hooten v. Lake County, 177 So. 2d 696 (Fla. App. 2nd DCA, 1965):

  • As we have indicated, the supreme court in the Town of Boca Raton case approved the principle that where a statute pronounces a penalty for an act, a contract founded on such act is void, although the statute does not pronounce it void nor expressly prohibit it.

Jaylene, Inc. v. Steuer, 22 So. 3d 711 (Fla. App. 2nd DCA, 2009) (Northcutt, J. concurring):

  • One well-established defense to the enforcement of a contract is that the contract violates public policy. See E. Allan Farnsworth, Unenforceability on Grounds of Public Policy, in Contracts ch. 5 (2d ed. 1990).

    This defense is firmly rooted in common law, and because it protects the interests of society at large as well as—and sometimes contrary to—those of the contracting parties, it is an important aspect of the courts' authority. As far back as 1775, Lord Mansfield was expressing the view that an agreement may be void on grounds of public policy, stating: "No court will lend its aid to a man who founds his cause of action upon an immoral or an illegal act." Id. § 5.1 at 347 (quoting Holman v. Johnson
    , 1 Cowp. 341, 343, 98 Eng. Rep. 1120, 1121 (1775)).

    An early Florida case recognized this defense to contract enforcement, citing the principle "ex turpi causa non oritur actio" to explain the law's reluctance to enforce contracts in violation of public policy. Town of Boca Raton v. Raulerson
    , 146 So. 576, 577 (Fla. 1933). Translated, the maxim means "`from an immoral consideration an action does not arise,'" which "expresses the principle that a party does not have a right to enforce performance of an agreement founded on a consideration that is contrary to the public interest." Black's Law Dictionary 607 (7th ed. 1999).

Upstate NY Sale Leaseback Peddler Gets 4 To 12 For Grand Larceny Conviction In Equity Stripping Ripoff Of Cash-Poor, Hi-Equity Homeowners In F'closure

In Albany, New York, the Albany Times Union reports:

  • Five former employees of a Colonie firm that conned property owners, banks and lenders in a large-scale mortgage fraud scheme are all headed behind bars and owe millions of dollars.

  • The ex-members of the now-defunct Rivertown Investments at 1762 Central Ave. shed tears, apologized to victims and pleaded for leniency. The company's former owner denied being a criminal — and said it would be "simply impractical" to imprison him. That failed to move County Judge Stephen Herrick before a packed courtroom of victims and weeping relatives of the defendants.

  • "I see this type of fraud very close, almost to a violent offense — it's different from other kinds of fraud," said Herrick, who described the actions at Rivertown as "extremely, extremely heinous."

  • Former Rivertown owner Geoffrey Goldman, 32, of Albany, received 4 to 12 years in prison for grand larceny; his brother, Jonathan Goldman, 29, of Walden, Orange County, former vice president, received 1 1/3 to 4 years for scheming to defraud; disbarred attorney Kevin Wheatley, 39, of Waterford, the company's former in-house counsel and executive vice president, received 3½ to 10½ years for grand larceny; Jessica Peryea, 29, of Albany, a former sales director at Rivertown, received 1 to 3 years for grand larceny; and former Rivertown loan officer Jordan Laccetti, 31, of Saratoga Springs, received one year in jail for falsifying business records.

  • Geoffrey Goldman was ordered to pay more than $5.6 million in restitution, which, when paid, satisfies the total amount sought. Wheatley owes more than $5.1 million; Jonathan Goldman more than $3.5 million; Peryea more than $3 million and Laccetti $908,000.


  • The defendants solicited homeowners in financial distress to sell their homes to Rivertown. The outfit leased the homes back to the homeowners for usually 18 months under promises of net equity to be held as down payment on the repurchase of the properties.

  • But the homes were never sold back, customers were evicted and clients who repurchased homes were forced to spend thousands of dollars beyond their initial agreements.

  • Rivertown sales agents duped customers into believing the company would buy the homes while the firm actually hired straw buyers to apply for mortgages. The straw buyers would sign a "series agreement" or other documents to become members of Rivertown holding companies that received titles to the properties but never spent any money required under the deals.


  • [Judge] Herrick noted [disbarred attorney] Wheatley has expressed fears his family could lose their home. "I find that somewhat ironic," the judge said.


  • Rivertown had at least 105 lease-back properties in New York, Pennsylvania and New Jersey ranging in value from $112,000 to more than $2.6 million. The case was prosecuted by Assistant Attorney General Nancy Snyder.(1)

For more, see 5 get jail, owe millions in mortgage schemeFormer employees of Rivertown Investments receive sentences.

(1) At one time, many in state and local law enforcement (particularly those with untrained eyes and who were otherwise clueless in handling 'semi-sophisticated' white collar crimes - for some, anything more complex than investigating a 'rubber check' case is 'semi-sophisticated') once passed on prosecuting these sale leaseback equity stripping ripoffs that under the flimsy pretense that these cases were merely 'civil matters.' Over the last couple of years, it's been primarily the Feds (U.S. Attorneys, FBI, Secret Service, etc.) that have been bringing prosecutions in these equity stripping ripoffs. However, as this story reflects, more and more state court prosecutors now appear to be stepping up to the plate and showing some guts by bringing criminal charges against these scammers. See, for example:

See generally:

Monday, December 12, 2011

Recently-Released Transcripts Of Grand Jury Hearing Sheds Light In Nevada Robosigning Probe

In Las Vegas, Nevada, KSNV-TV MyNews Channel 3 reports:

  • The massive robo-signing scandal that throws into question tens of thousands of Las Vegas foreclosures is unfolding. Newly-released transcripts(1) from last month's Grand Jury hearing shed light on how the foreclosure fraud went down.

  • The transcripts include last month's testimonies from investigators, homeowners, temp workers and four notaries. The workers, who were employed at Lender Processing Services (LPS) under Gary Trafford and Geraldine Sheppard, admitted to forging signatures on tens of thousands of notices of default.

  • Most blamed fear of unemployment for their decision to forge signatures and break the law. One notary said she needed to keep her job while getting through graduate school, another said he had a family to support.

  • Trafford and Sheppard are accused of running the scam by advising their employees to forge signatures on notices of default between 2005 and 2008. Those documents got the ball rolling on many Las Vegas foreclosures.

  • Notary Tracy Lawrence struck a plea deal with the state's Attorney General's Office for one count of notary fraud. She admitted to notarizing about 25,000 false documents. Lawrence was found dead in her home the day of her sentencing hearing a few weeks ago.


  • Todd Grosz, a criminal investigator for the Nevada Attorney General’s office, said that out of tens of thousands of documents from LPS that his investigation of the fraud examined, an overwhelming majority seemed suspicious.

For more, see Massive foreclosure fraud's scope revealed by transcripts.

(1) For the transcripts, see:

Housing/Civil Rights Lawsuit: Denial Of 'Affordable Housing' Condo Building Application Due To Town's 'No Blacks' Policy

In Darien, Connecticut, The New York Times reports:

  • DARIEN’S attitudes toward affordable housing are once again under scrutiny, this time in a federal civil rights action accusing the town’s planning and zoning commission, and its chairman, Frederick B. Conze, of trying to keep out black residents.

  • Christopher Hamer, a former Darien resident, filed the lawsuit last month, nearly two years after the commission denied his application to build condominiums, some below market rate, in a single-family neighborhood. The suit maintains that the commission’s denial was based on bias against housing that might attract blacks.

  • It accuses the commission of limiting opportunities for minorities to live in Darien by “keeping housing costs prohibitively high and preventing the construction of affordable housing units.”

  • Mr. Hamer’s accusations come as the federal Department of Justice continues investigating whether Darien violated the Fair Housing Act. When that inquiry began more than a year ago, federal authorities said they were specifically interested in a new provision in the zoning regulations that identified seven “priority populations” to be given preference for affordable housing.

  • Those populations largely consisted of people who already lived and/or worked in town, a policy that some fair-housing specialists said could be exclusionary given Darien’s small minority population. The planning and zoning commission has since repealed the “priority populations” provision.

  • To bolster its allegations of bias, Mr. Hamer’s suit cites public comments made by the commission’s chairman, Mr. Conze. One remark was taken from a 2008 hearing on another affordable housing application, in which Mr. Conze referred to such housing as “a virus” that needed to be contained.

  • The other is from his State of the Town Address last December, when, speaking of the trend toward development of high-density housing along transportation corridors, Mr. Conze warned, “The demographic and economic forces generated by our immediate neighbors to our east and west cannot be taken lightly,” adding that many people “view Darien as a housing opportunity regardless of its effect on the character of our town and existing home values.”

  • Darien’s neighbors to the east and west are the cities of Norwalk and Stamford. Mr. Hamer’s complaint contrasts the 0.5 percent of Darien’s population that is black with the roughly 22 percent in the bordering cities.

For more, see Housing Lawsuit Alleges Bias.

California, Nevada AGs To Combine Efforts Into Foreclosure Document Robosigning Scandal

The Las Vegas Review Journal reports:

  • Nevada and California, states with the highest foreclosure rates in the nation, will team up to investigate allegations of foreclosure fraud and other misconduct in the mortgage industry.

  • At a joint news conference in Los Angeles on Tuesday, Nevada Attorney General Catherine Cortez Masto and California Attorney General Kamala D. Harris said their offices would share litigation strategies and would link their teams in the handling of both criminal and civil investigations.

  • The two states will combine evidence and information gathered during ongoing investigations but will do separate prosecutions. Both states have created special task forces to investigate robo-signing of fraudulent loan documents before the housing market crashed and predatory practices on loan modifications in recent years.


  • When asked about states taking the lead while the U.S. Department of Justice has been criticized for not taking action, Masto promised to hold bank and mortgage company executives responsible for wrongdoing, regardless of their stature. "We use the tools and resources available to us … that's state law,'' Masto said. "It would be wonderful to have the federal government beside us, but that's not the case."

  • Harris said she was "looking forward to forging similar collaborations with other states."

For more, see Nevada, California plan joint inquiries into mortgage fraud.

New Jersey Foreclosures Slow To A Crawl While Lenders Wait For Ruling In Court Case Now Being Considered By State Supremes

In Newark, New Jersey, the Star Ledger reports:

  • In the nearly five months since the state Supreme Court effectively allowed six of the country’s biggest banks to begin filing foreclosures again, attorneys and court officials have been expecting a flood of new filings to hit the courts. Except it hasn’t happened.

  • Foreclosure filings are down 83 percent as of October this year, compared with the same time period last year, according to court figures, and there are at least 100,000 cases either pending in the system or waiting to be submitted.

  • Attorneys involved in the work in New Jersey point to at least one reason for the significant delay: a court case that has reached the state Supreme Court, with oral arguments on Wednesday.

  • The case, US Bank National Association v. Guillaume, is important because the court is asked to determine who must be named as a point of contact on the document that initiates the foreclosure process, known as the Notice of Intent to Foreclose. The state Fair Foreclosure Act requires identifying the lender and its contact information.

  • But because the original lender has often bundled and sold the loans to investors, the current lender lists the servicer, a third party that collects monthly payments and dispurses it to the mortgage holder. In this situation, the lender’s attorney argued it was unnecessary to name his client on the notice because the servicer had been assigned the mortgage rights.

  • Attorneys for the homeowners, Maryse and Emilio Guillaume, said listing the servicer is not sufficient, should the homeowner want to work out a solution and stay in the house, and any foreclosure judgment without the lender having been named should be voided.


  • The [New Jersey] appellate and trial courts have ruled in favor of the trust, deciding it was appropriate to list the servicer. But in August, a separate appellate panel determined in a ruling known as "the Laks decision" that the statute requires the financial institution to name the actual mortgage holder, and if it does not, the foreclosure complaint should be dismissed.

  • With its Guillaume decision, the Supreme Court is in effect resolving the conflict between the two appellate rulings. The Guillaume case was expedited through the courts, but there is no deadline for a decision.

  • And in the meantime, foreclosure filings to the court have all but ground to a halt. There are an estimated 60,000 cases pending in the courts, according to bank figures, and more in the pipeline.

For more, see Future of foreclosures in N.J. hinges on state Supreme Court decision.

Sunday, December 11, 2011

Maine Supremes Side w/ Bankster In High Profile Robosigning Case; OKs Lower Court Ruling Finding No Contempt When Lender Filed Faulty Paperwork

In Portland, Maine, The Portland Press Herald reports:

  • By a 5-1 decision released this morning, the Maine Supreme Judicial Court upheld a lower court ruling that allowed loan servicer GMAC Mortgage, despite admittedly flawed practices involved in affadavit signing, to foreclose upon a home in Denmark purchased in 2003 by Nicolle M. Bradbury.

  • Through the work of her attorney, Thomas A. Cox, a retired lawyer who volunteers for Pine Tree Legal Assistance, Bradbury had successfully fended off foreclosure by exposing so-called "robo-signing" practices of lender employees with little or no knowledge of the individual mortgages who nonetheless signed hundreds of affadavits each day.

  • The Bridgton District Court partially sided with Bradbury, in ordering the Federal Naitonal Mortgage Association (Fannie Mae) to pay nearly $24,000 in legal fees. Cox also wanted the lender found in contempt and the foreclosure dismissed, but the state supreme court disagreed.

Source: Court upholds ruling in robo-signing foreclosure (A Denmark woman whose case touched off a national uproar over foreclosures with faulty paperwork may finally lose her home).

For the ruling, see FNMA v. Bradbury, 2011 ME 120 (Me. December 6, 2011).

CBS News' 60 Minutes Takes Look Into Lack Of Bankster Prosecutions In Interviews With Two Whistleblowers

CBS News' 60 Minutes reports:

  • Two whistleblowers offer a rare window into the root causes of the subprime mortgage meltdown.

  • Eileen Foster, a former senior executive at Countrywide Financial, and Richard Bowen, a former vice president at Citigroup, tell Steve Kroft the companies ignored their repeated warnings about defective, even fraudulent mortgages.

  • The result, experts say, was a cascading wave of mortgage defaults for which virtually no high-ranking Wall Street executives have been prosecuted.

For more, see Prosecuting Wall Street.

To watch the 60 Minutes' segment, see:

Nevada AG Charges Three More Notaries In Massive Criminal Robosigning Prosecution

In Las Vegas, Nevada, The Associated Press reports:

  • Three more Nevada notaries are accused of falsely attesting to legal signatures on foreclosure documents in a broad Las Vegas-area mortgage fraud scheme that has led to the indictment of two Southern California title officers, the state attorney general's office said Monday.

  • The announcement that Meghan Shaw, Jennifer Lowe and Joseph Noel each face one charge of notarizing a signature of a person not in their presence came a week after Tracy Lawrence, the first notary identified as a key witness in the so-called "robo-signing" case, was found dead at home after missing sentencing on a similar charge.

  • The charge is a gross misdemeanor and carries up to a year in jail and a $2,000 fine. Court records filed Wednesday refer to Lowe as Jennifer Bloecker.

  • Each of the three, like Lawrence, testified before a grand jury that handed up a more-than-600-count indictment accusing Geraldine Ann Sheppard, 62, of Santa Ana, Calif., and Gary Randall Trafford, 49, of Irvine, Calif., of heading a scheme that led to the filing of tens of thousands of fraudulent foreclosure documents in Las Vegas between 2005 and 2008.

  • Sheppard and Trafford are employees of a publicly traded company, Lender Processing Services Inc., based in Jacksonville, Fla., that provides technology and services to major banks across the company. Noel formerly worked for the company.

  • The indictment alleges that Sheppard and Trafford directed employees to notarize forged signatures on documents filed with the Clark County recorder's office to begin home foreclosures.

For more, see 3 Nevada notaries named in foreclosure fraud case.

The Snooze Is Over For Tarrant County Officials As Adverse Possession Home-Snatching Scams Clearly Appear On Their Radar

In Tarrant County, Texas, the Star Telegram reports:
  • While county officials were asleep at the wheel, Tarrant County became a magnet this year for an odd assortment of squatters claiming other people's houses all over the area.

  • The cast of characters includes a homeowner who scooped up a dead neighbor's house; a woman who came to Fort Worth from Memphis to lay claim to a $2.7 million mansion; people who cited Bible verses as legal justification for taking properties; and career criminals who grabbed homes to lease to tenants.

  • All told, county records show that squatters and their associates claimed more than $8 million worth of properties, from Grand Prairie, Mansfield and Arlington to Fort Worth, Haslet and Keller, according to a Star-Telegram examination of county documents. Some of the squatters' elaborate schemes have stumped law enforcement officials.

  • One Tarrant constable has even asked the Texas attorney general's office for help in straightening out the mess. "Everybody is just trying to learn what in the world is going on," said Mansfield Constable Clint C. Burgess. "It's the craziest thing how anyone could be so brazen to just break into a home and start living in it."

  • The schemes are hard to unravel because of a loophole in a state law that allows people to suddenly claim supposedly abandoned sections of property if no owner is on the spot to challenge such a claim. The law's intent was to help ranchers and others who had tended vacant land for years, so they could eventually gain legal ownership of the property. That's done by filing a document called an adverse possession affidavit with the county clerk.

  • But the law doesn't distinguish between a claim on a $27 section of sod and one on a $2.7 million mansion with an elevator, three master bedrooms, a five-car garage and a pond with fish in the back yard.

  • File the proper paperwork, pay a $16 filing fee, keep up with the property taxes and live in the house three years or more, and even the courts may not be able to evict you.

For more, see Squatters claim more than $8 million worth of Tarrant County properties.

(1) For some examples of the off-the-wall paperwork being generated in connection with these home-snatching rackets, see: