Thursday, September 13, 2012

Ex-R/E Agent Cops Plea For Role In Bogus Mortgage Elimination Scam Based On Discredited 'Sovereign Citizen' Claims; Ripoff Fleeced $2.5M From Victims

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

  • A South El Monte man has agreed to plead guilty to a federal mail fraud charge in a scheme that falsely promised to eliminate mortgage debts for approximately 200 distressed homeowners who each paid a $15,000 fee. Instead of working on behalf of the homeowners, the man simply sent worthlessSovereign Citizenpaperwork to lenders – paperwork that did nothing to affect the mortgage of a single homeowner.

    In a plea agreement filed [] in United States District Court in Los Angeles, Ernesto Diaz, 57, who formerly worked as a realtor, agreed to plead guilty to one count of mail fraud. As part of the agreement, Diaz has agreed to cooperate in an ongoing investigation into against his company, Crown Point Education Inc., which had offices in Montebello and El Monte.

    Diaz joined the Crown Point scheme in March 2010 after the company had been in business for approximately one year. Diaz spoke at seminars to recruit distressed homeowners and to train salespersons in the Crown Point program.

    In his plea agreement, Diaz admitted that he and others promised distressed homeowners at these seminars that, in exchange for fees that were generally $15,000 per property, Crown Point would eliminate the homeowners’ mortgages within six to eight months through a secret process that involved sending packets of documents to lenders.

    Even though he told victims that he could eliminate their mortgage woes, Diaz admitted in his plea agreement that the process had never been successful. Diaz failed to tell distressed homeowners that earlier Crown Point clients – including Diaz’s own brother – had lost their houses to foreclosure and been evicted from their houses.

    In the plea agreement, Diaz admitted that another person affiliated with Crown Point filed bankruptcy documents in the names of Crown Point clients to delay foreclosure and eviction. Diaz acknowledged that Crown Point filed many bankruptcy documents without the knowledge of the company’s clients and that signatures of debtors and notaries were forged on many documents filed with the Bankruptcy Court.

    In his plea agreement, Diaz admits that approximately 200 homeowner-victims paid Crown Point nearly $2.5 million for help they did not receive. The claims made to distressed homeowners were based on discreditedSovereign Citizenclaims that mortgages are invalid because the banks did not actually lend the money used to fund mortgages and the notes were securitized.

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