CFPB Takes Action Against Wells Fargo and Chase for Illegal Loan Officer Kickbacks

The Consumer Financial Protection Bureau (CFPB) and the Maryland Attorney General announced yesterday that they have fined both Wells Fargo and JPMorgan Chase for an illegal kickback scheme with a title company, Genuine Title who went out of business in April 2014.

One of the former Wells Fargo employees, Todd Cohen and his wife, Elaine Oliphant Cohen, had used Genuine Title to reward bank loan officers with cash, marketing materials, and consumer information in exchange for referrals. (more…)

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Former TARP Bank Loan Officer Indicted on Embezzlement Charges

The Office of the Special Inspector General for the Troubled Asset Relief Program (SIGTARP) announced yesterday, that Brian W. Harrison, 55, a former vice president and loan officer at Farmers Bank and Trust in Great Bend, Oregon was charged with three counts of making false entries in bank records, 16 counts of falsifying loan and credit applications, two counts of embezzlement, and two counts of money laundering. (more…)

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California man from the O.C. arrested for loan modification fraud

A California man who operated an alleged loan modification scam, was arrested on New Years day in Orange County for mortgage fraud.

Carlos Jose Centeno, of Yorba Linda, was taken into custody by law enforcement after an investigation by the Ventura County Sheriff’s Department, and held on $390,000 bail, according to Deputy District Attorney Pete Pierce. (more…)

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Community Home Lenders Association Asks CFPB to Enforce Proper Licensing of Bank Loan Officers

The Community Home Lenders Association (CHLA) recently sent a letter to the Consumer Financial Protection Bureau (CFPB) asking them to enforce bank loan officers who originate residential mortgages to meet the basic testing and continuing education requirements as non-bank licensed loan originators. (more…)

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Massachusetts Woman Sentenced to 25 Years in Loan Scam

The FBI announced yesterday that a Billerica, Massachusetts woman was sentenced for wire fraud charges in connection with a bogus bank guaranty program.

Diane Glatfelter, 48, was sentenced by U.S. District Judge Douglas P. Woodlock to 30 months in prison, three years of supervised release, and ordered to pay $1,575,000 in restitution. In September 2014, Glatfelter was found guilty following a five-day jury trial of four counts of wire fraud, according to the FBI press release. (more…)

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Former GMAC and Countrywide Loan Officer Sentenced to Five Years in Prison for $7 Million Mortgage Fraud

Andrew Constantinou, a former loan officer at GMAC Mortgage and Countrywide Home Loans, was sentenced today to five years in prison for his role in a mortgage fraud scheme involving more than 40 properties that caused $7 million in losses to lenders, according to U.S. Attorney Paul J. Fishman.

The FBI said that Constantinou, 58, of Unionville, Connecticut, was originally convicted by jury of all counts on April 18, 2014. He was found guilty of conspiracy to commit mail, wire, and bank fraud. (more…)

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FTC Shuts Down Nationwide Loan Modification Scam

Ever since the mortgage crisis had started in 2007, there have been many white-collar crooks coming out of the criminal woodwork who opened up loan modification and foreclosure defense chop shops in order to scam struggling homeowners down on their luck. We have reported on many of these mortgage relief schemes for the last seven years being busted and shut down, but these fraudsters seem to be a dime a dozen. When one scam is busted by federal authorities, another 10 take their place.

For example, the FTC announced this past week that they obtained court orders against 22 defendants who operated fraudulent loan modification services to American homeowners that allegedly violate the FTC Act and the Mortgage Assistance Relief Services (MARS) Rule, which bans mortgage rescue and mortgage modification services from collecting upfront fees until they receive a written loan modification offer from their mortgage servicer that the consumer deems acceptable. (more…)

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Ringleader of $7 Million Florida Loan Modification Scam Sentenced to 11 Year Prison Term

The ringleader of a Florida based $7 million loan modification scam was sentenced yesterday to 11 years in prison, and was ordered to pay $5.9 million in restitution to victims for his mortgage crimes. The convicted criminal, Jason Vitulano, 39, of Boca Raton, pleaded guilty earlier this year to mail and wire fraud charges.

Vitulano had operated various sham mortgage modification companies from 2008-2009 such as FHA All Inc., Housing Assistance Law Center Inc., and Safety Financial Corp. It was from these companies, that Vitulano directed his criminal enterprise by leading a group of hired hitman telemarketers who targeted struggling homeowners across the country. (more…)

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Two Former Illinois Bank Officials Plead Guilty To Concealing Loan Delinquencies

The FBI announced on Monday, that a former First Community Bank and Trust officer, and a former director in Will County, Illinois have pleaded guilty to federal fraud charges in a scheme to hide losses from the bank’s loan portfolio in order to report it was in better shape than it actually was. The defendants conspired to conceal delinquent loan payments to the bank on behalf of two clients whose loans totaled, added up to approximately $2.8 million, and caused the bank to suffer more than $1.1 million in losses.  (more…)

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