Enabling "Buy & Bail" Scams, Breaking Into Foreclosed Homes All In A Day's Work For Las Vegas Real Estate Agents??? Everybody's Doing It, Says One

In Las Vegas, Nevada, the Las Vegas Sun reports:

• A Las Vegas real estate agent who landed a prominent role in a Time magazine cover story is being scrutinized by state licensing officials because of her comments, has left her employer and is lying low. The story by Joel Stein in the Aug. 24 issue, “Less Vegas,” is a high-spirited and high-altitude view of the troubles facing Las Vegas, which he calls both “our most American city” and “an entire city of John Dillingers.”

• In the story, Brooke Boemio — “a bouncy, sweet, recently remarried 31-year-old mom” — is cast as one of the Dillingers. She helps Stein break into a foreclosed home and brags about helping clients who are underwater on their mortgages buy a second house on the cheap and stop making payments on their first mortgages, pressuring the bank into selling the houses for a loss.

• Everybody’s doing it, she says in the story. In fact, she said, she did it herself. Since the story appeared, Boemio and her employer have, in the words of Coldwell Banker Wardley Real Estate President Jeff Sommers, “parted ways.”

***

• The buy-and-bail tactics described in the story, he said, are serious allegations and “really just in direct opposition to everything in our policies.” [...] When the story was published, it referenced a video on Time’s Web site titled “Breaking and Entering,” of Stein and Boemio entering an unoccupied home on the west side of town. Since then, the video has been removed from the Web site for what Time spokeswoman Betsy Burton described as “some sensitivity with various issues.”

For more, see Unflattering Time magazine story puts agent in hot water (Since bragging to magazine about unethical practices she’s off job, under scrutiny).

For the Time magazine article, see Less Vegas: The Casino Town Bets on a Comeback (the description of the above referenced scams begins on page 2 of the story).

For more on "Buy & Bail" real estate scams, see:

• The Wall Street Journal: Some Buy a New Home to Bail on the Old (Fannie Plans Rules To Avoid Practice Described as Fraud),
• ABC News: In Foreclosure? Buy a Second Home ('Buy and Bail' Is the Answer Some People Have Found to Threat of Losing Home),
• Las Vegas Review Journal: Buying & Bailing: Walking away from 'underwater' mortgage has pitfalls. BuyAndBail

Florida Closing Agent Admits Pocketing Client's Refi Proceeds, Leaving Retiree Facing Foreclosure; Scammer Moved To State After NY Fraud Conviction

In Archer, Florida, The Wall Street Journal reports:

• Last summer, Lawrence Ford jumped into the fast-growing market for so-called reverse mortgages. The retired auto mechanic and horse trainer used the money he received to pay off his existing $70,000 mortgage and "piddled away" the remaining $24,000 on things like restaurant meals for his four girlfriends, he says. Or so Mr. Ford thought. Last month, the owner of the Orlando, Fla., title company that handled his loan admitted to stealing more than $1 million from several reverse-mortgage holders, including Mr. Ford. Bank of America Home Loans, a unit of Bank of America Corp., says the title agent never sent it the money required to pay off Mr. Ford's mortgage. As a result, Mr. Ford says, the bank recently threatened to foreclose on his seven-acre ranch in Archer, Fla. "That will put me on the streets with my cars and horses and tools," says the 68-year-old Mr. Ford. Bank of America, which says there is no immediate danger of foreclosure, adds that it is working with Mr. Ford "to find a home-retention solution."

***

• Before moving to Orlando in 2008, Garry Martin, 37, the title agent on Mr. Ford's reverse mortgage, was convicted of mortgage fraud in New York. In Florida, Mr. Martin orchestrated about 10 reverse-mortgage schemes,(1) pocketing about $1 million, prosecutors say. As title agent, Mr. Martin was obligated to distribute funds from his victims' reverse mortgages to retire their conventional mortgage loans. But according to prosecutors, he kept much of the money. To prevent his victims from catching on, he arranged for their monthly mortgage statements to be mailed to an address he controlled. The scheme unraveled when the banks contacted the victims about their missed mortgage payments.

• Mr. Martin, who pleaded guilty to stealing over $5 million from more than 50 victims of mortgage-related frauds, faces up to 20 years in prison. His attorney declined to comment. Mr. Ford, meanwhile, fears he may be running out of options. Unless the bank agrees to modify his loan, he says, "I don't see a way out."

For the story, see Mortgage Fraud: A Classic Crime's Latest Twists (As 'Reverse' Loans Grow More Popular, Scams Put Older Adults at Risk).

(1) Referring to this ripoff as a "reverse mortgage scheme" is somewhat misleading. What was done in this case was simply nothing more than a flat out theft of escrow funds by a corrupt closing agent, where the refinancing proceeds that were derived just happened to come from a reverse mortgage. There is nothing inherent about a reverse mortgage that makes pulling off this scam any easier than if a conventional mortgage was involved. EscrowRipOffKappa

Iowa Woman Fights Foreclosure Claiming Estranged Hubby Forged Her Signature On Loan Documents; Files Quiet Title Action In Attempt To Void Mortgage

In Hamilton County, Iowa, The Daily Freeman Journal reports:

• Diana Messerly claims she didn't sign most of the loan documents that First State Bank of Webster City holds against her home, implying in a countersuit to the bank's foreclosure measures that her estranged husband, Doug Messerly, forged her signature on at least five separate occasions. She's also is claiming, in a suit filed in the Iowa District Court for Hamilton County, that Linda Cormaney, a First State Bank vice president and notary, notarized the loan documents against the Messerly home [...] even though they had not been signed by Diana Messerly in Cormaney's presence.

***

• But, perhaps more importantly, Messerly's countersuit also seeks an action of quiet title to end the dispute over who has a right to the property - First State Bank, which holds mortgage liens that amount to nearly $200,000 against the $170,790 home and property, or Diana Messerly, who lives there. An action of quiet title in Diana Messerly's favor would "quiet" any challenges or claims to her right to the title of the home and property, effectively freeing her - forever - of any claims against it.(1)

For more, see Accountant’s estranged wife fights foreclosure (Diana Messerly’s countersuit claims she didn’t sign loans against her home).

(1) In a separate matter, the article reports that a settlement is imminent in a lawsuit filed this spring in Webster County alleging Messerly, a former Webster City accountant, forged longtime client Margaret Stark's signature to documents selling off $260,000 in her investments, which he then deposited into his personal bank account at First State Bank, according to an attorney for the bank. DeedContraTheft

"Greek" Alumni Seek To Void Dubious Sale Leaseback Of College Fraternity House Now Facing Imminent Foreclosure; Criminal Probe Possible

In Springfield, Missouri, the Springfield News Leader reports:

• Seven months after a group of Alpha Gamma Sigma alumni sued over what they said was the illegal sale of their fraternity house, the property is threatened with foreclosure. Should that come true, the eight students in the house must find a new place to live. It would also mean the 38-year-old organization would lose its place on the Greek Row. [... T]he agriculture fraternity's house is set for a trustee sale Tuesday, said Leland Gannaway, an attorney for Citizens National Bank of Springfield. The bank has loaned nearly $200,000 on the house. Officials at Missouri State University said they'll find space for the eight fraternity members should they be evicted.

***

• Meanwhile, the Springfield Police Department is looking into the matter. "Based on preliminary reports, we believe there is enough information to start a criminal investigation," Lt. David Millsap said.

• The disputes apparently stem from a 2005 sale of the house to two individuals, who at the time were on the board of directors of Alpha Gamma Sigma of Springfield, Inc. The corporation owned and managed the assets of the fraternity. [... Charles] Marshall, then the president of Alpha Gamma Sigma of Springfield Inc., said no formal vote was taken [approving the sale]. Interested members agreed to the sale over phone calls.

• Other alumni, nearly four years later, now argue the sale was invalid because the deal was not authorized by the corporation's board of directors, according to the petition they have filed in the Greene County Circuit Court. Since the sale, Marshall said he and [co-owner Robert] Ferber remodeled the property and leased it [back] to the fraternity. County records show the duo soon refinanced the initial note with a $120,000 loan from Citizens National Bank and, in 2006, borrowed another $78,895 against the fraternity house from the same bank.

For more, see Fraternity house faced with foreclosure.

For story update (9-2-2009), see Bank buys fraternity house at auction (Members will be able to work out lease arrangement).

Recording Artist Sues Lender In Attempt To Fend Off Foreclosure; Says WaMu Reps Put Bogus Info In Loan Application, Tricked Couple Into Signing

In Kaua'i, Hawaii, The Honolulu Advertiser reports:

• A singer who gained popularity in the late 1960s with the song "Hello It's Me" has filed a lawsuit here against a Washington-based bank, asking a judge to stop the financial institution from foreclosing on his Kaua'i home. Todd Rundgren filed the complaint Wednesday in state Circuit Court and alleged that representatives from Washington Mutual misled him and his wife, Michele, when the couple refinanced a loan on their property in Kilauea. The lawsuit, filed by attorney Gary Dubin, lists as defendants Washington Mutual Bank and JP Morgan Chase, which acquired WaMu in September 2008. The Rundgrens are asking for a temporary restraining order to halt foreclosure actions, as well as an undetermined amount in damages and attorneys fees.

***

• The Rundgrens allege they refinanced a mortgage on their Kaua'i home in February 2008 for $3 million. But they said WaMu representatives created a false loan application that exaggerated their gross monthly income and then tricked them into signing the application. [... Dubin] acknowledged that the Rundgrens did not read the mortgage document at the time they signed it, but he said very few people do. "I can tell you this: I never read mine either," he said. "The clients who come to see me, the single word they always use is 'trust.' They trust the loan broker who was so nice to them. They trust that it was a big-looking company."

For the story, see Singer sues bank in foreclosure (Rundgren suit stems from $3M Kauai home refinancing).

Oregon Man Cops Plea To Foreclosure Stripping His Own Home

In Damascus, Oregon, The Oregonian reports:

• After stripping his foreclosed home of everything from the air conditioning system to the kitchen sink, Grigoriy Bogoslavets was convicted of a crime that is often witnessed but rarely reported. The 33-year-old electrician pleaded no contest last month to aggravated theft after stealing more than $50,000 of property attached to his former Damascus home, one of the few such cases in Oregon or across the country to result in prosecution. He will be sentenced Sept. 22.

***

• Departing homeowners' taking off with fixtures that are legally part of the house -- generally anything attached or installed -- is nothing new to real estate brokers. What's changing, especially in the nation's worst housing markets, is the recognition that such acts can be criminal.

***

• Neighbors tipped off police when they saw Bogoslavets return to his former home with a van after vacating the premises. Investigators discovered Bogoslavets had taken nearly everything he could remove, including the kitchen island, fireplace, bathtubs, the doorbell and electrical outlets.

For more, see Damascus man even took the kitchen sink from foreclosed home (if link expires, try here).foreclosure fixture stripping apple

Role Of Licensed Loan Modification Consultants In Nevada Mandatory Foreclosure Mediations An Unanswered Question

In Las Vegas, Nevada, the Las Vegas Review Journal reports:

• Permanent regulations that require licenses for home mortgage modification and foreclosure consultants are expected to become effective [this week], but one important question remains unanswered. Can these licensed consultants represent clients in mediation sessions with mortgage lenders?

For more, see License rules leave questions (Whether consultants can represent clients in mortgage mediation unclear).

In a related story, see Las Vegas Sun: Agency gets authority to set fines for bilked homeowners (Nevada commissioner of mortgage lending adopted rules Tuesday giving his agency authority to license loan modification & foreclosure consultants and to take disciplinary action, including fines up to $10,000 for violations):

• These companies or agents must place the up-front money collected from the homeowner in a trust account and can draw down only when they deliver a service. Education requirements are in place that those in the business must get anywhere from 15 hours to 25 hours of instruction. Bonds must be posted with the lowest amount at $75,000.

California Real Estate Agent Gets 90 Days After Admitting To Forging Unwitting Victim's Name On $900K+ In Loan Documents To Purchase Home

In San Bernardino, California, the Contra Costa Times reports:

• A Chino Hills real estate agent was sentenced to 90 days in jail [last week] after pleading guilty to forging more than $900,000 in loan documents. Anita Mendoza, 44, was accused of forging another person's signature to obtain the loans, which she used to purchase a home in Chino Hills in 2006. In addition to the jail time - which Mendoza can serve on weekends - the Realtor was placed on three years' probation Friday in San Bernardino Superior Court and ordered to attend a counseling program. [...] She will be required to pay back $180,000 lost by a mortgage company victimized in her scheme, Deputy District Attorney Vance Welch said last month. When Mendoza was interviewed by investigators last month, she confessed to forging loan documents to purchase her home.

For the story, see Chino Hills Realtor sentenced to 90 days for loan forgery.

Tennessee Real Estate Operator Screwed Us In Bogus Real Estate Deals, Say Clients

In Dickson, Tennessee, WSMV-TV Channel 4 reports:

• Some families who Jimmy Greene has done business with seem to end up losing their homes. Karen and Doug Young said Greene caused them to lose their house in Dickson to foreclosure. [...] The Youngs wanted to sell their house, and so they signed a contract with Greene and Greene Custom Homes. The deal was that if it didn't sell, Greene would make the payments. But he didn't. "They did not pay for May, June, July or August of 2008, and that was why it was in foreclosure," said Doug Young. They never saw it coming, they said, because Greene intercepted the correspondence from their mortgage company. "All of the contact numbers were changed, down to the e-mail address, so that everything would go to him and we wouldn't know," Karen Young said. The two ended up losing the house.(1) And they aren't the only ones who have said their real estate deals with Greene ended badly.

***

• [Marsha Hargrove] and her husband were buying a home they ended up losing. They had signed a rent-to-own contract with Greene, then found out after two and half years that Greene didn't own the house and all the improvements they made were down the drain.

***

• Deborah Branham's family was renting to own from Greene but found out he wasn't paying the mortgage on the family's house, either. It, too, was in foreclosure, and they lost their $5,000 down payment.

For the story, see Clients Say Company Ruined Homeownership (Greene And Greene Custom Homes Faces String Of Lawsuits).

(1) Reportedly, the Youngs went to court and won, but they have yet to collect on their $25,000 judgment.

Oregon AG Settles Suits With Two Firms, Begins Probe Into At Least Six Others In Effort To Find & Prosecute Crooked Loan Modification Rackets

From the Oregon Department of Justice:

• Attorney General John Kroger [Wednesday] announced a new enforcement effort to protect Oregon homeowners by targeting loan modification companies that engage in deceptive and misleading business practices. [...] The attorney general announced that his Financial Fraud and Consumer Protection Unit has opened more than half a dozen investigations related to loan modification companies and mortgage fraud. Kroger also announced the results of two cases.

• [Wednesday's] settlements are with National Homeowners Assistance Services, Inc. [$4,000 in legal costs reimbursement], based in Lake Forest, Calif., and American Mitigation Group [$4,000 in restitution], based in Newport Beach, Calif. The companies offered loan modification assistance and related services to homeowners facing foreclosure. The companies purposefully used tactics that could confuse homeowners, including implying they were affiliated with government agencies or programs.

***

• [Wednesday's] settlements are one part of an overall Oregon Department of Justice strategy to protect Oregon homeowners. The Department of Justice will vigorously pursue crooked loan modification companies.

For the Oregon AG press release, see Attorney General John Kroger Cracks Down On Loan Modification Scammers (Two California loan modification companies must stop misleading Oregon consumers).

Condo Association Trend Seeking "Blanket Receiverships" In Attempt To Avert Financial Disaster Begins To Take Hold In Central Florida

In Central Florida, the Orlando Sentinel reports:

• Condominiums in Central Florida are cutting back on things like tennis-court lights and are seeking help from the courts because so many condo owners are abandoning their fast-depreciating units and refusing to pay required maintenance fees. "It's a major crisis right now," said Bill Raphan, a supervisor with the state Division of Condominiums.

• Desperate condo associations are starting to seek court-appointed receivers — a trend that started in South Florida but has spread to this part of the state. It's a sign of how dire the situation is, said Donna Berger, executive director of the Community Advocacy Network, a nonprofit group representing more than 1,500 condo and homeowner associations. "The current economic downturn and foreclosure crisis have placed many associations on the brink of disaster," she said.

***

• Last week, state Circuit Judge Alan A. Dickey appointed Seth R. Heller and Co. to collect fees at the Villas. More than 60 percent of the 294 unit owners are delinquent, with individual tabs of as much as $11,000 for some owners of multiple units. Total unpaid fees: $720,000. If those condo owners or their tenants don't pay up soon, they will be held in contempt of court and at some point could face arrest. "Without this order, the association was really facing financial collapse," said Fort Lauderdale lawyer Stuart Zoberg, who represented the Villas board. "And all along you have these landlords laughing, because they are collecting rents, and they still siphon off as much money as they can from their renters without paying association fees."

For more, see Condos sic judges on owners for back fees.

In a related post, see Florida Appeals Court OKs "Blanket Receivership" In Condo Association Battle Against Rent Skimming Unit Owners, Deadbeat Investors.

Role Of Attorneys Representing Homeowners In Mandatory Foreclosure Mediations Questioned

In Las Vegas, Nevada, the Las Vegas Sun reports:

• The Nevada legal community is getting behind a new mediation program designed to reduce the state’s ongoing foreclosure problem, but some attorneys are facing criticism for trying to profit from it. [...] One legal advocate for the poor has criticized the program, sayings attorneys are preying on homeowners for a service they don’t need. Many attorneys, however, said it never hurts to have legal representation in the complicated process to keep a home.

• Michael Joe, an attorney and foreclosure specialist for the Legal Aid Center of Southern Nevada, said he has seen attorneys advertise their services for $1,500 to $3,500 to help homeowners in mediation. It’s piggybacking on attorneys’ ads to help homeowners modify loans, he said. Joe called it no different from an attorney waiting outside of a hospital for injured patients who are brought in by ambulance.

***

• Robert Noggle, a real estate and business attorney with Black & LoBello, said attorneys have helped people stay in their homes by working with lenders and helping negotiate short sales. In mediation, attorneys may need to advise the homeowner on what is offered by lenders. Although attorneys aren’t necessary, not every homeowner who goes into mediation has the time or inclination to understand the rules, Noggle said.

For more, see Lawyers’ role in foreclosure mediations sparks debate (At issue: Are homeowners buying what they don’t need?).

In a related story, see License rules leave questions (Whether consultants can represent clients in mortgage mediation unclear).

Mortgage Servicer's Insurance Payment Screw Up Left Texas Couple "Naked" During Hurricane Ike & Stuck w/ Force-Placed Policy, Says Suit

In Galveston, Texas, The Southeast Texas Record reports:

• A Galveston County couple is suing a subsidiary of Citigroup for failing to pay their insurance premium payment on time. Garry and Karrie Higgs' breach of contract suit alleges St. Louis-based CitiMortgage mishandled a payment that was essential to the renewal of their policy with the Texas Windstorm Insurance Association ["TWIA"].

***

• According to the complaint, CitiMortgage was responsible for initiating premium payments from an escrow account. The suit states that CitiMortgage was informed by Nationwide in late July 2008 that the Higgs' coverage was set to expire in two months. Nationwide then established a three-week window for payment. The plaintiffs claim CitiMortgage did not properly heed Nationwide's request, but CitiMortgage claims it made the payment but accidentally mailed it to a wrong location.

• Both Nationwide and the Higgs claim they repeatedly tried to contact CitiMortgage regarding the payment, only to be told by the defendant it was already issued. The payment finally surfaced on Sept. 10, 2008, a week after the deadline and three days before Hurricane Ike. Ike, a Category 2 storm, came ashore and inflicted a significant amount of damage to the plaintiffs' residence. The Higgs say their new TWIA policy did not include the events during Ike and was cancelled. "As a result, CitiMortgage purchased its own force-placed insurance policy and charged the plaintiffs a higher and more expensive premium," the suit says.

For the story, see Galveston couple blames Citigroup for failing to pay TWIA premiums.

Conn. AG Files Civil Suit Against "Renegade Real Estate Ring" Putting Customers Into Unaffordable Mortgages; Referral To Criminal Prosecutors Possible

In Hartford, Connecticut, The Connecticut Post reports:

• Latinos throughout Southwestern Connecticut were victims of a wide-ranging predatory-lending scheme that used a Stamford real estate office to guide them into unaffordable mortgages, Attorney General Richard Blumenthal charged on Tuesday.(1) Many of the 120 or so victims are unable to speak English and about 33 homes have already been lost through foreclosure, said Blumenthal during an interview in which he said the case will be referred to state and federal prosecutors for possible criminal investigation.

• He detailed a "renegade real estate ring" in which customers dealing with Roman Realty, a Century 21 affiliate on Bedford Street, would be taken to an adjacent mortgage company and later have their incomes falsified by a third company for use on loan applications.

For more, see Blumenthal says Latinos were victims of predatory lending scheme.

(1) According to the story, Blumenthal, representing the state Department of Banking and the Department of Consumer Protection, has sued VRM Mortgage Company, Inc. and Roman Realty, Inc. and the companies' owner, Victor Roman, as well as VRM's office manager, Tony Mojica. He's also filed a lawsuit against Jose Flores, the owner of Harvard Financial Services, located on Virgil Street in Stamford.

Ohio AG, Cuyahoga County Task Force Bust 41 People In Alleged Straw Buyer Mortgage Scam Involving 453 Houses, $44M In Fraudulently Obtained Loans

In Cleveland, Ohio, Crain's Cleveland Business reports:

• Four companies and 41 people(1) have been indicted in an alleged mortgage fraud scheme spearheaded in Beachwood. The scam allegedly included 453 homes and $44 million of fraudulent loans. The Cuyahoga County Mortgage Fraud Task Force(2) and the Ohio Organized Crime Investigations Commission allege that Beachwood resident Uri Gofman convinced friends and relatives to invest in his real estate company, Real Asset Fund. He began the business with seed money from Latvia, the officials said in a press release, but used “straw buyers” to purchase homes. The company then falsely claimed that improvements were made to the homes so they could be refinanced, the attorney general's office alleged. The houses were then sold to unqualified buyers.

For more, see Indictments handed up in alleged mortgage fraud scheme.

See also:

• Ohio Attorney General press release: Task Force Cracks Mortgage Fraud Case Involving 453 Homes,
• The Cleveland Plain Dealer: 41 indicted in $44 million county mortgage-fraud scam (Scheme helped bring down home values, worsen blight, prosecutors say).

Go here to see a complete list of the defendants and charges.

(1) The 45 individuals and outfits busted were: Uri Gofman, 36, of Beachwood, Tony Viola, 43, of Cleveland, Igor Gofman, 47, of Beachwood, Samyel Goldshtein, 51, of Highland Hts., Alex Kurlienko, 27, of South Euclid, Kevin Landrum, 30, of Solon, The Real Asset Fund, 2120 Green Rd. South Euclid, Yan Satanovskiy, 61, of Lyndhurst, Irina Satanovskiy, 61, of Lyndhurst, Ester Simkhovich, 35, of Lakewood, New Jersey, Leonid Simkhovich, 31, of Wickliffe, Gennadiy Simkhovich, 52, of Highland Hts., Marina Simkhovich, 47, of Highland Hts., Alexander Vinokur, 39, of Solon, Eric Gesis, 45, of Highland Hts., Tigran Babloyan, 44, of Reminderville, Karka Inc., 2120 Green Rd. South Euclid, James Alexander, 42, of Warrensville Hts., Tiffany Alexander, 39, of Beachwood, Farah Dailey, 30, of Euclid, George F. Gardner III, 38, of Euclid, Donnie Eatmon, 44, of Macedonia, Rochelle Huffman, 35, of Cleveland Hts., Brian P. Jordan, 48, of Cleveland, Crystal McCoy, 53, of Cleveland, Maura McKissic, 32, of Cleveland Hts., Steve Greenwald, 43, of Solon, Zakkiyya Mumin, 32, of Warrensville Hts., Sulieman Mumin, 30, of Warrensville Hts., Troy E. Spencer, 47, Cleveland Hts., Shirley Board (Vannerson), 59, of Cleveland Hts., Nathan Prusak, 35, of Bay Village, Dale M. Adams, 34, of Solon, Miroslav Simkhovich, 35, of Willoughby, Ronald Medley, 45, of Cleveland, Darrin Harsley, 39, of University Hts., Dave Pirichy, 38, of Burton, Linas Puskorius, 51, of Cleveland, Howard Sieferd, 58, of Euclid, James M. Leoni, 35, Lyndhurst, Realty Corporation of America, 815 Superior Ave. Cleveland, Tiffeney Dennis, 35, of Cleveland Hts., Alicia McKnight, 25, of Bedford Hts., Gregory L. Krainess, 44, of Beachwood, JN & DH Investments, 3213 Portman Ave. Cleveland.

(2) Task Force members include:

• Ohio Organized Crime Investigations Commission
• Cuyahoga County Prosecutor's Office
• Ohio Bureau of Criminal Identification and Investigation
• Cuyahoga County Sheriff's Office
• Cleveland Heights Police Department
• Solon Police Department
• Beachwood Police Department
• Pepper Pike Police Department
• HUD Inspector General's Office
• Cuyahoga County Recorder
• Cuyahoga County Auditor
• Cuyahoga County Treasurer
• Ohio Department of Commerce-Division of Financial Institutions
• F.B.I.
• U.S. Attorney's Office
• U.S. Postal Inspector

California Real Estate Agent Cops Plea To Investment Scam That Pulled In $1.25M+; Victims Include Senior Who Invested Bulk Of Life Savings

From the Office of the Ventura County, California District Attorney:

• District Attorney Gregory D. Totten announced [...] that Veronica Sanchez Gallegos, a licensed real estate agent residing in Ventura, pled guilty on August 6, 2009, to one felony count of theft from an elder, five felony counts of grand theft, and admitted a special allegation of taking more than $500,000. In an investigation conducted by the District Attorney's Office Bureau of Investigation, it was determined that Gallegos conducted a fraudulent investment scheme where six victims entrusted her with a total $1,289,000. Victims invested money with Gallegos after relying on false assurances made by Gallegos that their investments were being pooled into short term construction, real estate, and similar “secured” loans [...] and were protected by an escrow fund in the event of default.

***

• One 65 year-old victim invested the bulk of his life savings for a total of $284,000 and suffered a net loss of $244,000. Other investors invested amounts ranging from $40,000 to $622,000.

Go here for the Ventura County DA press release.

Queens Woman Accused Of Swiping Deed To Brooklyn Retiree's Home & Emptying His Savings Account; House & Cash Recovered In Civil Suit

In Brooklyn, New York, the New York Daily News reports:

• A Queens mom in a child support battle offered to help an elderly man with his own Family Court problem - and then stole the deed to his home and cleared out his bank account, officials said. Chandra Myers is facing larceny and forgery charges and a possible 15 years in prison if convicted of scamming Brooklyn retiree Levi Latham. She's accused of using the documents he gave her to forge his signature on a property transfer and using a fake power of attorney to grab his $25,000 savings.

***

• With the help of Legal Aid lawyer Roger Hawke, Latham sued Myers and Citibank and got his house and money back when she didn't bother to show up to court. Myers, 42, isn't in the clear, though. She's been hit with criminal charges by the Brooklyn district attorney and pleaded not guilty during a July 16 hearing. [...] Hawke said his client, a former military man, has still not recovered from the scam. "It's so easy to take the property away but so difficult to correct it," he said.

For the story, see Fake advocate's offer of help turns into horror story as woman swindles elderly gent in $25G scam.

"Helpful" Neighbor Gets 57 Months For Ripping Off Cancer Patient; Stopping Automatic Bank Debit For House Payments Leads To Near Foreclosure

In Fort Worth, Texas, the Star Telegram reports:

• Debilitated by breast cancer, Jody Short of Mansfield was grateful two years ago when a neighbor offered to help care for her after she came home from the hospital. Sixteen months later, Short learned that the neighbor, Janice Gast, whom she considered a friend, had begun using her identity, her credit cards and her bank accounts shortly after she took over Short’s care.

• Gast, 42, was sentenced to prison [last week] after pleading guilty to forging Short’s name on documents and stealing more than $67,000 from her over about a year. State District Judge Sharen Wilson sentenced Gast to concurrent four-year prison terms on charges of felony theft and fraudulent use of identification, and to nine months in state jail on a forgery charge.

***

• [Prosecutor Tiffany] Burks said the worst thing Gast did was stopping the automatic bank debit for Short’s monthly mortgage payments. "Her lender was in the process of filing a foreclosure, so she almost lost her home," Burks said.

For the story, see Neighbor who stole from cancer patient gets 4 years, 9 months in prison. FinancialAbuseOfElderlyAlpha

Upfront Fee Florida Foreclosure Rescue Operator Gets Apparent Hand Slap In Federal Civil Suit; FTC To Suspend $4.1M Judgment After Payment Of $21K

The Federal Trade Commission recently announced:

• The Federal Trade Commission has put a stop to a deceptive foreclosure "rescue" operation that charged homeowners $1,200 based on the false promise that it could save them from losing their homes. The operators of the business(1) are barred from any further deceptive practices under a settlement with the FTC. The agency charged them with violating the FTC Act by falsely claiming that they would prevent homes from being foreclosed in virtually all instances or refund most of the $1,200 fee. In most cases the defendants neither stopped foreclosure nor provided promised refunds.

***

• The order imposes a $4.1 million judgment, which will be suspended upon transfer of $21,694 in bank account funds that were frozen by the court. The full judgment will become due immediately if the defendants are found to have misrepresented their financial condition.

For the entire FTC press release, see FTC Action Stops Foreclosure 'Rescue' Operation.

For linkks to the relevant court documents in this matter, see Federal Trade Commission v. United Home Savers, LLP, et al.

(1) The defendants are Stephanie Dietschy, Darin Dietschy, and United Home Savers, LLC, all based in Florida. loan modification

Westchester DA Indicts Eight In Alleged Equity Stripping Foreclosure Rescue Scam After Joint Probe w/ NYS Banking Dept.; Four Families Victimized

In White Plains, New York, The Journal News reports:

• Eight people(1) were indicted for a countywide mortgage scheme that defrauded four families and two mortgage lenders of $1.4 million, Westchester authorities announced [Tuesday]. The perpetrators "induced desperate property owners fearing the threat of foreclosure to deed their homes to 'investors' with the promise that they could re-purchase their property in 12 to 24 months," District Attorney Janet DiFiore stated in a news release. "In fact, the defendants colluded to strip the property of its equity by obtaining inflated mortgages based on fictitious purchase prices using 'show' checks to deceive the banks as to the actual purchase price." The arrests followed a nine-month probe by DiFiore's office and the state Banking Department. The targeted families were from Croton-on-Hudson, Yorktown, Cortlandt and Mount Vernon.

Reportedly, Westchester DA Fiore said that four members of the alleged racket were attorneys,(2) and that the four victims who had their home equity ripped off in the sale-buyback deals would have to bring civil lawsuits against the alleged perpetrators to try to get their homes back.(3)

Source: Eight indicted in Westchester mortgage scheme.

For the Westchester DA press release, see Indictment Unsealed In Countywide Mortgage Fraud Scheme (Eight Individuals Defrauded 4 Families For 1.4 Million Dollars).

(1) Arrested were Doreen Swenson, 60, and Herbert "Phil" Hall, 60, of Tarrytown; Mildred Didio, 44, of Manhattan; David Reback, 67, of Rye Brook; Amerigo DiPietro, 59, of Brewster; Eileen Potash, 52, of Queen; Wilma Shkreli, also known as Wilma Gecay, of Westwood, N.J.; and Frank Corgiliano, 44, of Newtown, Conn.

(2) The lawyers were identified as Didio, Reback, Potash, Corigliano. The four lawyers, along with the four others, were indicted Tuesday, each on charges of grand larceny, fraud and conspiracy. They pleaded not guilty. See 4 lawyers indicted in $1.4M NY scam.

(3) See DA: Lawyers taking desperate owners' NY homes.

Ten State AGs, Feds Form Posse To Target Equity Skimming, Bogus Foreclosure Rescue, Straw Purchases, Unethical Lending Practices

The New York Times reports:

• Ten state attorneys general and four federal agencies have announced the formation of a task force to combat mortgage fraud. According to a statement issued by Washington state Attorney General Rob McKenna, targets of the enforcement effort include equity skimming, bogus foreclosure rescue, straw purchases and unethical lending practices.(1)

• The group is headed by McKenna and Iowa Attorney General Tom Miller. Other members include the attorneys general of Arizona, Colorado, Illinois, Nevada, North Carolina, Massachusetts, Missouri and Ohio, as well as representatives from the Department of Justice, Federal Treasury, Department of Housing and Urban Development and Federal Trade Commission. McKenna says the task force is the result of meetings on July 15 in Washington, DC, between federal regulators and a number of state attorneys general.

Source: Attorneys General Form Mortgage Fraud Task Force.

(1) “Scammers and opportunists need to know that they’re in the crosshairs of a tough, well-armed posse with a presence in every state,” McKenna said. McKenna said that by combining their enforcement powers and expertise, state and federal authorities are in a stronger position than ever before to take on equity skimmers, foreclosure rescuer schemers, straw purchasers and unethical lenders who deceive or discriminate.

Mississippi Couple Cops Pleas In Bankruptcy Fraud-Related, Deed Transfer Foreclosure Rescue Scam; Wife Goes Down For Failing To Turn In Hubby

In Jackson, Mississippi, The Clarion Ledger reports:

• A Jackson couple will be sentenced Nov. 5 in federal court after pleading guilty to fraud related charges. Robert E. Power Jr. pleaded guilty Friday to conspiracy to commit bank and wire fraud, and bankruptcy fraud. His wife, Deaundrea Power, pleaded guilty to misprision of a felony for failure to report bankruptcy fraud committed by her husband.

• The couple had operated a business, Yorkshire Financial Services on Ridgewood Road in Jackson, which targeted homeowners at risk of foreclosure. The couple had represented to the homeowners that in exchange for transfer of their property to Yorkshire and a monthly rental payment, the company would negotiate mortgages or refinance mortgages to allow homeowners to remain in their homes, according to the United States Attorney’s Office. But the Powers would then place the property in bankruptcy unbeknownst to the homeowners and either the home would eventually be forclosed upon, or sold through straw buyers, via fraudulent loans, where the Powers would obtain cash money from the sale. As a result of the Powers’ actions, the homeowners lost their homes while the Powers gained a profit from the fraudulent activity, according to the federal investigation.

Source: Jackson couple pleads to fraud charges.

For the U.S. Attorney press release, see Couple Pleads Guilty To Mail Fraud, Bankruptcy Fraud And Falsifying Documents In Bankruptcy Cases. loan modification