California Man Sentenced for Massive Mortgage, Tax and Bankruptcy Fraud Schemes

The US Department of Justice announced that Donald V. Totten, a former successful small mortgage business owner from Rancho Santa Fe was finally sentenced last Friday after over a year since his initial trial date to serve 30 months in prison for four felony fraud counts related to mortgage, tax and bankruptcy fraud scheme.

According to the USDOJ, Totten was the owner of an at home mortgage business that utilized other businesses to run national advertisements on T.V. to lure in borrowers with the chance to refinance their mortgages. Victims of the scam were lured into his pitches for loan programs such as the “adjustable rate negative-amortization loan,” and “stated income” loans. Once they were on the hook, Totten committed fraud in order to inflate incomes for his clients and commit other frauds that allowed him to make millions off in commissions. (more…)

Small Nonprofit Mortgage Servicers to Benefit From New Mortgage Rule

Two minor adjustments to mortgage rules for servicers proposed by the Consumer Financial Protection Bureau (CFPB) back in April, were finalized last Wednesday. According to the CFPB, the minor alterations are designed to provide mortgage servicing privileges to specific non-profit organizations that aid low income populations; to extend mortgage credit to more deserving consumers, and to ensure that consumers who have lenders that exceed the points and fees cap, receive refunds in limited circumstances.


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The Modification Group Charged with Defrauding Dozens of Homeowners in Loan Modification Scheme

The USDOJ recently announced, that Robert Walker of North Royalton, Ohio, was indicted last Thursday on 21 counts of mail fraud and 2 counts of wire fraud; charges that connect him to defrauding over 90 homeowners out of $250,000 in a fraudulent loan modification scheme.

According to the USDOJ, Walker allegedly used his company, “The Modification Group (TMG)” from 2009 through 2011 to deceive borrowers facing foreclosure by promising them loan modifications for an upfront fee of $1,995 or 1% of their loan (whichever amount was greater), and led them to believe that they would receive 80% of that fee back once their reduction was made permanent. (more…)

Fannie Mae Settles $170 Million Lawsuit for Deceptive Business Practices

The government sponsored mortgage giant known as Fannie Mae, finally settled in a U.S. District Court in Manhattan last Friday, to pay $170 million to reconcile charges of deceiving company shareholders about company finances, risk mismanagement, and mortgage exposure prior to being taken over along with Freddie Mac by the U.S. government during the 2008 financial crisis. (more…)

Washington Hard Money Lender Sentenced to Prison for Fraud

The US Department of Justice announced this week, that Emiel A Kandi, a hard money lender from University Place, Washington State was sentenced on Wednesday to 5 years in prison, followed by 3 years of supervised release for a conspiracy to submit false statements in loan applications charge, for making false statements to HUD, and for actually submitting false statements in loan applications.

According to the USDOJ, records between 2008 and 2009, showed that Kandi and others used false information such as borrowers’ employment, salary, and intention to borrow on applications, in order to obtain home loans that he would use to manipulate people to his will. For example, some of the fraudulent mortgages were marked to enable Kandi to cash out of the properties owned through his hard money lending. Using the loans in a structured manor, he secured several borrowers’ homes as the collateral, and seized absolute control if the borrower defaulted even once. In order to maximize his profits, Kandi even manipulated some paperwork in order to inflate the prices by the use of appraisals.

Deborah Bortner, Director of Consumer Services at the Washington State Department of Financial Institutions (DFI) commented that it was this criminal’s activities that influenced the legislature to change the law in order to protect consumers who use a business loan to secure their primary residence.

“Emiel Kandi was particularly predatory to some of our most vulnerable citizens.” Said Bortner.

As a result of the loss of over $800,000 for federally backed lenders such as Pierce Commercial Bank, Kandi was additionally sentenced to pay up $831,607 in restitution.

At his sentencing, U.S. District Judge, Ronald B. Leighton condemned Kandi for his illegitimate behavior and labeled him as a predator. “He took advantage of situations.  He found a method to secure funds… He was aggressive, he was pushing the envelope, he was a risk-taker without humility and without empathy – those characteristics are ruinous.” said Leighton.

Source: Justice Department






VA to Continue to Host Town Hall Events to Educate Veterans

The VA recently announced, that veterans all across the nation have the chance to learn about local town hall events in their areas through their nearby VA Medical Centers.

Previous attendees of such events that were held in the months of August and September, may be asking how these events are being held again so soon? According to Secretary of Veterans Affairs, Secretary Robert McDonald, the benefits and healthcare of veterans and their families is an important need that communities need to communicate more about. (more…)

Five People in Northern California Indicted for Foreclosure Auction Fraud Scheme

The US Justice Department announced yesterday, that five real estate investors from Northern California were indicted by a federal grand Jury in San Francisco’s District Court for fraudulent bid rigging schemes at foreclosure auctions. The defendants are suspects of a larger Northern Californian-based conspiracy which 47 individuals have already admitted to, or agreed to admit to have been apart of. (more…)

Collateral Underwriter: Fannie Mae Releases New Underwriting Tool for Mortgage Lenders

Fannie Mae announced on Monday, that in early 2015, a new proprietary appraisal analysis application will be available to lenders, enabling them to compare appraisals against Fannie Mae’s database of appraisal and market data. Known as the Collateral Underwriter , the goal of this new underwriting tool is to expand mortgage credit and provide certainty around repurchase risk. (more…)

CashCall Banned From Lending in Iowa

At the beginning of October, CashCall Inc., an online lender based in Anaheim, California had its Iowa lending license repealed by the Iowa Superintendent of Banking. Not only is the California lender banned from lending to Iowans, but also must pay victimized borrowers of over 3,400 illegal loans, back $1.5 million.

The charges brought against CashCall were for illegally charging Iowa borrowers interest rates of up to 169% on their loans, when Iowa law caps annual interest rates at 36%. According to one of the complaints filed last year in 2013, the individual was charged an annual percentage rate (APR) of 340%. Most of the APRs turned out like this when all of the fees and additional costs were put together. (more…)

Colorado Man Sentenced to Prison for Real Estate Investment Fraud Scheme

The U.S. Justice Department announced earlier this week, that Chaval Williams, of Centennial, Colorado was sentenced to serve 74 months in federal prison for defrauding lenders out of $2.4 million in a real estate investment scam. He was guilty of wire fraud, identity theft, and money laundering. In addition to getting over 6 years in the pen, Williams was also ordered to be under 3 years of supervised release, and pay $766,800.81 in restitution. (more…)

FICO survey shows many Americans are uneducated on their financial rights

FICO just released a comprehensive online survey that asked 1,000 bank customers questions regarding their own knowledge on their financial rights, and they reported a majority of them received negative results. As it turns out, 14% of the test takers received a D (67% correct) when asked about their financial rights; 12% got a C average (75% correct; a mere 3% received a B (83% correct) and only 1% received a ranking of an A (92% correct) on the FICO survey. (more…)

Vice President of TD Bank Indicted by the Feds for Fraud

The US Department of Justice (USDOJ) announced this week, that Frank Spinosa, the regional Vice President of TD Bank has been charged with conspiring to commit fraud, and having worked with the already convicted executive officer Scott W. Rothstein of Rothstein, Rosenfeldt and Adler, P.A.

According to the indictment that was unsealed last Friday, Spinosa allegedly defrauded investors along with Rothstein from 2008 to November 2009. The investigative works of the FBI and the IRS thus far have found that the pair of executives worked together to utilize their positions as a tool to swindle investors. (more…)

NAMB Announces New Partnership With America’s Homeowners Alliance (AHA)

The National Association of Mortgage Brokers (NAMB), and America’s Homeowners Alliance (AHA) recently announced a new partnership that enables NAMB member’s and customers with a one year free membership in the AHA.

This partnership will now give NAMB customers access to AHA advocacy and member rewards benefits which include:

– Rewards points that permit members to make purchases for their homes.

– The ability to make other purchases on personal items using their unique rewards system.

– Enjoying a non-credit card system as a way to rack up points. Their system allows you to use your personal debit cards to accumulate points. (more…)

Wells Fargo Pays Million Dollar Settlement Over Maternity Leave Discrimination Lawsuit

The U.S. Department of Housing and Urban Development (HUD) announced last Thursday, that Wells Fargo Home Mortgage reached a settlement resolving allegations of them discriminating against pregnant women, and newly-made mother borrowers who were on maternity leave. Wells Fargo had a total of 190 maternity leave-related lending discrimination complaints, and 40 other similar settlements made since 2010. (more…)

Former OC California Mortgage Broker Charged in Alleged $17.9 Million Mortgage Fraud

The US Justice Department recently announced, that Brady Bunte, a former mortgage broker from Orange County California was charged by a federal grand jury for allegedly conspiring to defraud various banks out of millions of dollars. Bunte was arraigned at the very end of September in Santa Ana, California, but shortly after, released on a $100,000 third-party bond. (more…)

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