Tuesday, March 6, 2012

Feds Squeeze Guilty Plea From Another Scammer Peddling Bogus Equity Stripping Sale Leaseback Deals To High Equity, No-Cash Homeowners In Foreclosure

From the Office of the U.S. Attorney (Norfolk, Virginia):

  • Ray D. Gata, 56, of Chesapeake, Va., pleaded guilty [] in Norfolk federal court to conspiracy to commit wire fraud in connection with a fraudulent foreclosure rescue scheme.


  • According to court documents, from November 2006 until February 2011, Gata and a conspirator engaged in a foreclosure rescue scheme that defrauded homeowners and mortgage lenders.

  • The conspirator promised homeowners that he could save them from foreclosure by arranging a sale of their homes to Gata and other straw borrowers. To further entice the homeowners, the conspirator promised that they could remain in their homes after the sale, pay rent, and he would resell the homes back to them once they were more financially secure.

  • The conspirator and Gata profited from this scheme by taking all of the proceeds from the home sales. To complete the scheme, the conspirator and Gata executed false closing documents that showed the proceeds of the sale going back to the homeowners when, in fact, the proceeds were going to Gata, the conspirator, and the other straw borrowers.

  • The homeowners received nothing from the sale of their homes while the conspirator, Gata and others received in excess of $170,000. In almost every case, the conspirator required the homeowners to pay more in rent to cover a larger mortgage, and ultimately evicted these homeowners from their homes.

For the U.S. Attorney press release, see Chesapeake Man Pleads Guilty to Mortgage Fraud Scheme.

(1) For more on this type of foreclosure rescue ripoff, see:

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