Florida Foreclosure Rescue Operators Found Guilty In Federal Fraud Trial

Five of seven indicted members of a Central Florida foreclosure rescue operator group were found guilty of mortgage fraud last Thursday in a Tampa, Florida Federal Court, according to an article in the Tampa Bay Business Journal. Those convicted include Ramzy Moumneh and Kamal Moumneh (aka Kamal Renno), who owned and operated First Hanover Mortgage Corp., that was purportedly in the business of assisting financially strapped homeowners facing foreclosure to keep their homes. They also allegedly controlled other entities involved in the subject transactions.

Also found guilty were:

• Chuong X. Dam, a business associate of the Moumnehs.
  
• Demetrios J. Voiklis (aka James Voiklis), who, according to the indictment, is an attorney who did business as Juris Title, and who acted as a closing agent for real estate transactions, and
  
• Kimberly Brothers, who worked as a closing agent for Voiklis and Juris Title.

The case against a sixth co-defendant, Amy Hudd (aka Amy Paukner) was severed during the trial due to health problems and, unless she decides to plead guilty in the hope of getting some leniency, is expected to be tried separately (in which case, and unless there's a hung jury, she'll either be found not guilty and walk free, or she'll be found guilty and probably get hammered by the judge at her sentencing). The seventh member of the group, Lucretia Junge, waived her right to a trial, pleaded guilty, and testified at the trial against the others involved.
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The foreclosure rescue plan that was being arranged allegedly involved deceiving the homeowners into signing deeds conveying their homes to third party investors, acting as a straw buyers, with the understanding that the homeowners could lease back their home and ultimately buy it back after making twelve monthly payments. In the process, the homeowners ' equity in their homes were allegedly stripped, with the money derived therefrom ending up in the operators' pockets. According to the indictment, the investors / straw buyers:

• Did not make any actual investment,
• Were people with good credit,
• Were falsely told that they would not be personally liable for the loans being obtained,
  
• Were paid a fee by the conspirators for acting as straw buyers,
• Were falsely held out to the mortgage lenders financing the purchases as "bona fide purchasers" who intended to personally repay the loan when, in fact, they were not bonafide purchasers and had no intention on repaying the loans.
  

The indictment further alleged, among other things, that both the homeowners who signed away their homes and the straw buyers were neither given a chance to read the documents they were asked to sign, nor were they given copies of the documents they signed. Additional allegations involved phony claims of liens made by the conspirators on the homeowners' properties, use of false loan applications and inaccurately prepared HUD-1 closing statements, and false representations to the mortgage lenders that the homes would be occupied by the straw buyers.

To read the media report, see Five convicted in home equity fraud.

For those seeking a greater understanding of how this scam worked (ie. prosecuting attorneys, civil attorneys representing homeowners victimized by this type of foreclosure rescue deal, investors wanting to learn what not to do), you may want to check out the Indictment - U.S. vs. Moumneh, et al.
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