Predatory Mortgage Foreclosure Fraud

Targets of the scheme described by Deputy District Attorney Larry Roberts were homeowners desperately trying to save their homes from foreclosure who thought they were obtaining refinancing but wound up selling their houses to straw buyers.


In the process the remaining equity in their houses allegedly was stolen through inflated commissions, escrow charges and other fees.

Be very careful of anyone promising an easy foreclosure fix by refinancing or "temporarily" transferring ownership of your property. You may not get it back.

Full article.

10 San Bernardino County residents accused of predatory mortgage fraud

09:14 PM PDT on Wednesday, May 7, 2008

By LESLIE BERKMAN
The Press-Enterprise

Ten San Bernardino County residents face criminal charges of participating in a predatory lending scheme based in Rancho Cucamonga that generated more than $2 million in fraudulent mortgages.

A lawsuit filed this week in San Bernardino County Superior Court alleges that the scam was headed by Andrew Whitaker, 52, of Alta Loma, who had a prior real estate-related felony conviction for which he served prison time.

Targets of the scheme described by Deputy District Attorney Larry Roberts were homeowners desperately trying to save their homes from foreclosure who thought they were obtaining refinancing but wound up selling their houses to straw buyers.

In the process the remaining equity in their houses allegedly was stolen through inflated commissions, escrow charges and other fees.

Roberts said the district attorney's investigation, which resulted in 13 felony charges being filed late Tuesday against the defendants, focused on three transactions involving properties in Moreno Valley, San Clemente and Simi Valley. Out of those transactions, Roberts said, operators of the alleged scheme pocketed over $300,000 for themselves.

The mortgages for more than $2 million were obtained under false pretense by providing phony down payments and misinformation about the buyer's credit and income on loan applications, Roberts said. Then the loans were immediately sold to Countrywide, which would never have bought the mortgages if it had known the truth, he said.

Because of Whitaker's criminal history, he could not have obtained a license to operate an escrow or mortgage business, Roberts said, so he brought in family members to front the operation.

"The prosecution alleges (Whitaker) was the owner and operator of all the companies and certainly in direct control of them all," said Roberts.

Whitaker's daughter Heather Nicole Whitaker served as president of two companies -- Nationwide Discount Home Loans and Preferred Metropolitan Escrow Inc. -- that participated in the transactions and his former wife Majgan (Mona) Cox, was the licensed real estate broker doing business as ReMax/Allegiance Realty.

Also, prosecutors said Whitaker's present wife, Karren Whitaker, participated as a licensed real estate appraiser doing business as Pacific Coast Realty Appraisals Inc.

All four businesses were at 10535 Foothill Blvd. in Rancho Cucamonga, according to authorities.

Prosecutors narrowed their investigation to three mortgages that occurred between March and August 2007.

"I am sure there are probably dozens of victims from other transactions," said senior investigator Maurice Landrum.

Nationwide was incorporated in 2003 and its license expired in May of 2007, according to the state Department of Real Estate.

The State Department of Corporations on March 24 took action to revoke the license of Preferred Metropolitan Escrow Inc. It filed an accusation claiming that, among other things, Preferred's license application failed to say Andrew Whitaker would be involved in the company, although a regulatory probe in September revealed that he controlled its operation.

Arrested Wednesday were Andrew and Karren Whitaker, of Alta Loma; Cox, also of Alta Loma; Cox's son Jesse Sinclair Cox, of Redlands; Jason Harvey, of Bloomington; and Juleanne Brooks, of Fontana.

Other defendants named in the criminal case and still at large Wednesday afternoon were Katrina Michelle Whitaker, Andrew Whitaker's older daughter, who was secretary of the mortgage and escrow companies, and Phillip Parker and Andre Thomas Silva, who were mortgage salesmen.

This was the second major prosecution for mortgage fraud filed in recent months by the San Bernardino County district attorney. In March the office filed a lawsuit seeking $20 million in penalties and restitution from the operators of Lifetime Financial, accused of involvement in a statewide predatory lending scheme.

[Cat Damiano]

Excellent Article Steve.............
Here is the other article on the straw buyers that happened in the Cali area too............I know they were charged at the end of March, but same premis as the newly charged purpetrators.............so sad that these scum would take advantage of people that are drowning........

Feds Indict 19 In Mortgage Fraud Case Struggling Homeowners Victimized, Officials Say

POSTED: 1:51 pm MDT March 24, 2008
UPDATED: 2:36 pm MDT March 24, 2008


SACRAMENTO, Calif. -- Nineteen people have been indicted in connection with a nationwide mortgage fraud scheme, federal officials in Sacramento said on Monday. Video: Feds Indict 19 In Mortgage Fraud Case
Charles Head, a 33-year-old Los Angeles resident, is accused of being the leader of a scam targeting homeowners in dire financial straits, fraudulently obtaining titles to more than 100 homes and stealing millions of dollars through fraudulently obtained loans and mortgages, Sacramento station KCRA is reporting.

The case, known as Operation Homewrecker, included an investigation by the FBI and IRS.

Prosecutors said the charges are broken into two separate indictments: Head One and Head Two. If convicted, the suspects may face several years in prison.

On Feb. 28, a federal grand jury returned the first set of charges in a 13-count indictment against 16 defendants on suspicion of mail fraud, conspiracy to commit mail fraud, conspiracy to commit money laundering and other related offenses.

[COLOR="Red"]Authorities said Head One involved a foreclosure rescue scam, netting approximately $6.7 million in fraudulently obtained funds taken from 47 homeowners, nearly all of whom were located in California.[/COLOR]
"Subjects charged in this indictment duped innocent homeowners who were in dire financial situations into believing they were receiving help to save their homes and to recover financially," said Drew Parenti, FBI agent in charge.

Prosecutors said that from approximately Jan. 1, 2004, to March 14, 2006, the defendants contacted desperate homeowners, offering two options allowing them to avoid foreclosure and obtain thousands of dollars up-front to help pay mounting bills. [COLOR="Red"]If the homeowner could not qualify for the first option, which virtually none could, they would be offered the second option. Under the latter option, an investor would be added to the title of the home, to whom the homeowner would make a rental payment of an amount allegedly less than their mortgage payment, thereby allowing the homeowner to repair their credit by having the mortgage payments made in a timely fashion.[/COLOR]
All of this was a scam, the federal government said. The defendants would recruit straw buyers as the investors and often times these individuals would in fact replace the homeowners on the titles of the properties without the homeowners' knowledge, the government said. These straw buyers were often friends and family members of the defendants. Once the straw buyer had title to the home, the defendants immediately applied for a mortgage to extract the maximum available equity from the home. The defendants would then share the proceeds of the ill-gotten equity and rent being paid by the victim homeowner. When the defendants ultimately would sell the home, stop making the mortgage payment, and/or pursue an eviction proceeding, the victim homeowner was left without their home, equity or repaired credit.

In addition to Charles Head, the following defendants were charged in the Feb. 28 Head One indictment:

Jeremy Michael Head, 30, of Huntington Beach
Elham Assadi, aka Elham Assadi Jouzani, aka Ely Assadi, 30, of Irvine
Leonard Bernot, 51, of Laguna Hills
Akemi Bottari, 28, of Los Angeles
Joshua Coffman, 29, of North Hollywood
John Corcoran, aka Jack Corcoran, 52, of Anaheim
Sarah Mattson, 27, of Phoenix, Ariz.
Domonic McCarns, 33, of Brea
Anh Nguyen, 36, of Los Angeles
Omar Sandoval, 32, of Rancho Cucamonga
Xochitl Sandoval, 29, of Rancho Cucamonga
Eduardo Vanegas, 28, of Phoenix
Andrew Vu, 39, of Santa Ana
Justin Wiley, 28, of Irvine
Kou Yang, 32, of Corona.

On March 13, the federal grand jury returned a five-count indictment in Head Two against seven defendants -- including Charles Head, John Corcoran, Kou Yang and Dominic McCarns, who were all three charged in Head One -- as well as the following people:

Keith Brotemarkle, 42, of Johnstown, Pa.
Benjamin Budoff, 41, of Colorado Springs, Colo.
Lisa Vang, 24, of Westminster.

Prosecutors said Head Two involved an equity stripping scheme, netting approximately $5.9 million in stolen equity from 68 homeowners in states across the nation. While still targeting distressed homeowners and defrauding mortgage lenders through the use of straw buyers, this time Charles Head allegedly altered the scheme so that he would receive approximately 97 percent of the stolen equity, while his sales agents and employees, and the other defendants, would receive either the remaining 3 percent of equity or a salary from the fraudulently obtained funding.

Instead of recruiting friends and family members as straw buyers, as in Head One, in Head Two the defendants allegedly recruited strangers via the Internet. They also are accused of using referrals from mortgage brokers to identify and solicit new victim homeowners. Beyond advertising on the Internet, the defendants also allegedly would send blast faxes to mortgage brokers throughout the country and generate mass e-mails to potential victims. [COLOR="Red"]Through material misrepresentations and omissions, victim homeowners would be offered what appeared to be their last best chance to save their homes[/COLOR], prosecutors said. As in Head One, these victims also were left without their homes, equity or repaired credit.
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