Northeast Ohio Prosecutors Crack Down On Mortgage Fraud & Predatory Lending
59 defendants were indicted Wednesday on 269 charges of racketeering, forgery and theft involving a mortgage fraud scheme in the Cleveland metropolitan area, according to the office of Cuyahoga County Prosecutor Bill Mason. Additional indictments are pending.
The story, reported here at Cleveland.com (the online presence of Cleveland's The Plain Dealer), describes the indictments as "part of a long-awaited crackdown on shady real estate and lending practices that have left homes abandoned and helped Cuyahoga County rack up one of the highest foreclosure rates in the nation."
An assistant county prosecutor was hired by County Prosecutor Mason's office last year to focus on crimes such as mortgage fraud and predatory lending.
In a prepared statement, Mason said "You predators are now put on notice. Those of you who engage in deception in the lending process will face criminal charges."
There is no indication in this article, however, as to whether Mason's policy will be extended and applied to predatory "foreclosure bailout loans" made to financially strapped homeowners attempting to save their homes from forced sale. Such loans are often "disguised" as sale-leasebacks by "foreclosure rescue" companies in the belief that structuring the transaction in this way enables an investor to avoid usury statutes, eliminate the hassle of foreclosure proceedings and homeowners' redemption rights, and provide for an effective way for the investor to either:
The story, reported here at Cleveland.com (the online presence of Cleveland's The Plain Dealer), describes the indictments as "part of a long-awaited crackdown on shady real estate and lending practices that have left homes abandoned and helped Cuyahoga County rack up one of the highest foreclosure rates in the nation."
An assistant county prosecutor was hired by County Prosecutor Mason's office last year to focus on crimes such as mortgage fraud and predatory lending.
In a prepared statement, Mason said "You predators are now put on notice. Those of you who engage in deception in the lending process will face criminal charges."
There is no indication in this article, however, as to whether Mason's policy will be extended and applied to predatory "foreclosure bailout loans" made to financially strapped homeowners attempting to save their homes from forced sale. Such loans are often "disguised" as sale-leasebacks by "foreclosure rescue" companies in the belief that structuring the transaction in this way enables an investor to avoid usury statutes, eliminate the hassle of foreclosure proceedings and homeowners' redemption rights, and provide for an effective way for the investor to either:
- earn interest income on their investment in an amount that exceeds the maximum allowed by law, or
- acquire a financially desperate property owner's home equity at well below market value.
For The Plain Dealer follow up story, see:
Click here for the Channel 3 story, at wkyc.com
Click here to watch/listen to Channel 3 video news report
(Revised 1-6-07, 1-20-07)
posted by Home Equity Theft Reporter at 5:47 AM
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