Duo Who Ran Loan Modification Ripoffs Go Down On Theft, Foreclosure Fraud Charges; Approx. 400 Victims Fleeced Of Nearly $2M

In Santa Clara County, California, the Gilroy Dispatch reports:

• Rene Alvarez and Mariano Ortega, the co-owners of M & R Contemporary Solutions, a Campbell foreclosure consulting firm, pled guilty and no contest Monday to theft and foreclosure fraud charges. The charges related to a scheme that, over a year, bilked about 400 mainly Hispanic homeowners out of close to $2 million.



• A total of 10 victims were from South County: seven from Gilroy, two from Morgan Hill and one from San Martin, according to Mike Fitzsimmons, Deputy District Attorney for the real estate fraud unit.



• Victims, who were in various stages of the foreclosure process, were told that M & R Contemporary Solutions would save their homes from foreclosure by facilitating the purchase of their existing lender's loan by a third party at a discounted price.



• Ostensibly, the homeowners would then be offered a new reduced principal loan that would have significantly lower monthly payments. Homeowners paid from $3,000 to $10,000 each to M & R depending on how far along they were in the foreclosure process. The collection of up front fees from homeowners in foreclosure is a felony under California law regulating the conduct of foreclosure consultants.



• In many instances, victims paid $10,000 even though they had already lost title to their homes via foreclosure. No M & R client ever received a new loan.

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• Sentencing for Alvarez and Ortega is scheduled for May 21 in Santa Clara County Superior Court, Department 30. They will receive a five year sentence of jail and mandatory supervision under the new California realignment law. A third defendant in the case, Cydney Sanchez, is still pending trial in the matter.



• Investigators have seized $257,000 from M & R's bank accounts which may be applied toward restitution. Victims of M & R who seek information on the sentencing or restitution should contact the Santa Clara County District Attorney's Office Real Estate Fraud Unit at (408) 792-2879.

Source: Foreclosure consulting firm owners convicted of defrauding homeowners.