Watch Out For Well Known Home Repair Scams
Welcome to The Home Equity Theft Reporter, a blog dedicated to informing the consumer public and the legal profession about Home Equity Theft issues. This blog will consist of information describing the various forms of Home Equity Theft and links to news reports & other informational sources from throughout the country about the victims of Home Equity Theft and what government authorities and others are doing about it.
For more, see Game Over: New Century Won’t Be Bought.
For more, see Area woman accused of ripping off her mother.
Fulton County District Attorney Paul Howard is calling for anybody else who may be familiar with Woods and this kind of practice to come forward and speak to the D.A.’s office to determine if he’s done this kind of thing before.
Go here to watch the WSB-TV Channel 2 report (video no longer available) or, to read the text of the report, see Local Police Chief Accused Of Stealing House.
In this report, attorney William Purdy from the Santa Cruz law firm of Simmons and Purdy, who reportedly with his law partner have hundreds of cases of Truth in Lending violations, is interviewed.
Also covered in the report is another case where The Fair Housing Law Project of the non-profit agency The Law Foundation, which provides free legal services to Silicon Valley individuals in need, is suing a broker and lender on behalf of a consumer borrower for Truth In Lending violations.
Purdy says the Truth in Lending Act is not a way of getting out of debt -- but it can be a way of getting out of a bad loan, and it essentially depends on whether the lenders got sloppy with the right-to-cancel document required to be given to refinancing homeowners. (The part of the law being enforced in these cases only applies to homeowners who are refinancing; it does not apply on purchase transactions.)
To watch the report, by CBS5's Tony Russomanno, see CBS5 Video - Bay Area Homeowners Backing Out Of Bad Loans, (then, click "Play") or
Go here for the text of the story - Bay Area Homeowners Backing Out.
For a related article, see Finding a legal escape clause (Attorney rescues homeowners from loans they can't afford)
For a story involving law firm Simmons & Purdy that resulted in the arrest of mortgage broker Altaf Abdulrehman Shaikh (alias Zak Kahn) for allegedly ripping off homeowners in mortgage transactions, see DA: Scammer sought to bilk homeowners.
Go here for more posts on homeowners who have refinanced into bad mortgage loans and are now using the Federal TILA to try and undo the bad loans.
Using the Federal Truth In Lending Act is also being used by financially strapped homeowners to void sale leaseback, repurchase option deals entered into with foreclosure rescue operators. See, for example,
Go here for more posts on homeowners who have refinanced into bad mortgage loans and are now using the Federal TILA to try and undo the bad loans. undo mortgage loans TILA alpha
An impromptu, on camera interview was attempted with some of the accused at their office; however, they didn't seem to interested in answering any questions. While their attorney agreed to appear on camera, he didn't seemed to relish the opportunity to answer Josh Bernstein's questions, either (he sounded like he had "marbles in his mouth" and he looked like "a deer caught in the headlights." I actually felt sorry for him. He looked like a young guy; maybe he needed to earn the legal fees from representing these clients so he could pay his own mortgage.)
All the investors have reportedly filed lawsuits. A lawsuit filed by one of the investors is currently pending in Sacremento County, California Superior Court alleging fraud, constructive fraud and breach of fiduciary duty, civil conspiracy, negligent misrepresentation, and unlicensed practice of law, among other claims against some or all of the above named accused. Representing the investor in this lawsuit are Dennis B. Hill and Andrew E. Bakos of Hill Law Firm, Lincoln, California.
To read that lawsuit, see Romano vs. Martin, et al. (6.51 MB)
Go here to watch the KCRA3 report by Josh Bernstein (no longer available online).
The homeowner named as defendants in her lawsuit Boca Raton, Florida mortgage broker Nicole Smith, her husband Mauricio N. Smith, mortgage brokerage Signature Lending Group, Inc., Deborah O'Hara (with addresses in Coral Springs, Florida and Brooklyn, New York), and two instituitional lenders among others in which she is seeking relief for:
The basis for the criminal complaint filed by authorities comes from information from an unnamed "confidential witness", identified as CW1, who was a partner in the mortgage fraud, who has already agreed to plead guilty, and has also agreed to "sing" to the Feds in exchange for a lesser sentence for his/her role in the scam. In addition, there are three additional unnamed confidential witnesses, CW2 and CW3 (both of whom have pleaded guilty to fraud charges in a related investigation and have agreed to "sing" to investigators in the hopes of getting lighter sentences), and CW4.
Red flags were raised when two of the victimized mortgage companies noticed high rates of default on the New Generation-originated mortgages; they subsequently found a fraudulent pattern of employment and income information when they audited the corresponding mortgage applications. At that point, the two mortgage companies called in law enforcement.
Described in the criminal complaint are undercover stings that are captured on video, involving confidential witness CW1 and an undercover FBI agent pretending to be a notary public and title closer at a simulated property sale closing.
One element of the alleged scam, as described in the criminal complaint, was the use of "short sales", in which the one member of the alleged conspiracy would negotiate a discounted payoff from the mortgage lender on a loan secured by a particular property controlled by the alleged fraud group. After successfully negotiating the "short pay" and re-taking control of the property for a fraction of what was owed, the property could then be resold to another straw buyer a significantly higher price, thereby "recycling" the property through the alleged fraud group's operation all over again.
For the full story (at least the version filed by the FBI Special Agent in the case), see the Criminal Complaint filed by Federal prosecutors, U.S.A. vs. Hossain, et al.
For media reports on this story, see:
The article also cites the variety of excuses that the rogue attorneys offer up when they get nailed. For more, see Rotten lawyers face raft of raps in ripoffs.
For information on filing attorney grievances and obtaining relief from dishonest attorney conduct in New York State, see:
Go here for stories on other alleged escrow agent mishandling of funds. sneaky slick escrow agents alpha
California has specific statutes strictly regulating foreclosure rescue purchasers and mortgage foreclosure consultants who approach homeowners facing foreclosure seeking to do business with them.
In California, an Associated Press appears in the Ventura County Star that warns:
For more, including the story of an equity stripping victim who lost her home and equity to a forecloure rescue "consultant" (who has since been sentenced to three years and eight months in prison), see:
For the Maryland statute regulating foreclosure rescue operators, see the Maryland Real Property Law, Title 7, Subtitle 3 - Protection of Homeowners in Foreclosure (Sections 7-301 through 7-321). (Each section of the statute has its own link).
No word on how Buddy the Donkey held up on cross examination, but reportedly the litigants settled the matter while the jurors were deliberating. For more, see Attorney brings donkey to testify on own behalf in court, reported by Daily Report.