California Real Estate Broker Cops Plea To $43+ Million Swindle

The San Jose Mercury News reports:

• "A Hillsborough man who preyed on the elderly through a real estate scam and swindled many people out of their life savings pleaded no contest Tuesday in a Santa Clara County courtroom to 173 felony counts, and may spend the rest of his life in prison. Michael Schneider, 45, took more than $43 million from his victims, according to the Santa Clara County District Attorney's Office. The complaint was filed jointly by the district attorney's offices in Santa Clara and Santa Cruz counties. [...] Some of the elderly victims "don't have a life anymore," said Saratoga resident Saeed Fazeli, a retired engineer who says he lost about $6.8 million in the scam. [...] Fazeli estimated that more than 50 people lost their life's savings.

Schneider's attorney, Daniel Horowitz claims that there is currently available enough funds in the bankruptcy court to return to victims about 30 percent of what they lost, but that "bankruptcy attorneys are gutting all the money." For more, see Man enters no contest plea in real estate scam.

See also, Broker pleads no contest to 173 felonies (Man could face up to 169 years in alleged pyramid scheme).

New Jersey Social Worker Pleads Guilty To Scamming Senior In Home Sale Proceeds Ripoff

In New Jersey, the Bridgeton News reports:

• "A 45-year-old Egg Harbor man pleaded guilty [last week] to stealing more than $70,000 from an elderly nursing home patient. [Alexander] Gotay, a Cumberland County social worker, admitted ... [that] he stole approximately $70,000 from an elderly patient, who has since died, who had resided at Lincoln Specialty Care Center in Vineland. He admitted withdrawing the victim's life savings from her various bank accounts and stealing the proceeds from the sale of her former residence."

For more, see Social worker pleads guilty to theft.

Go here , go here , and go here for other posts on elder financial abuse. yak elder financial abuse

Pennsylvania AG Investigating "Short Sale" Flipping Scam

(revised 8-23-07)
The Pittsburgh Post-Gazette reports that the Pennsylvania Attorney General's office is investigating a residential real estate transaction involving a short sale, a quick flip, the alleged use of falsified double HUD-1 settlement statements, and possible mortgage fraud. The individual at the center of the deal is James Platts, of Easy Realty Solutions. Platts has, in the past, reportedly pleaded guilty to a dozen counts of fraud and theft in connection with the home building business he once ran, and he was indicted earlier this year on charges of tax evasion. He has also been the subject of complaints by dozens of couples in connection with other real estate transactions, according to the story. He has also reportedly been connected with a "rent-to-own" program offered to consumers. For more, see Confusion reigns in murky house sale.

For more on Jim Platts (and a similar operation he runs in Florida), see Company under investigation in Pa. seems to have a twin in Florida (Realty pitch sounds familiar).

Go here for other posts on James Platts.

Missouri Feds Indict Broker In Mortgage Fraud / Identity Theft Scam

The Kansas City Star reports:

• "A federal grand jury [last week] indicted a Lee’s Summit woman in a purported scheme to defraud hundreds of thousands of dollars from mortgage lenders. Kimberly M. Davis, 42, was charged with eight counts of wire fraud, five counts of aggravated identity theft and one mail fraud count. Davis worked as a mortgage broker for two Northland firms between November 2003 and January 2005, according to court records. Prosecutors alleged that Davis illegally used the identities of three men to prepare bogus mortgage loan applications. She allegedly used the money to purchase two homes, prosecutors said."

For more, see Lee’s Summit woman accused of mortgage fraud, identity theft.

For KCTV Channel 5 reports on this story, watch Mortgage Broker Accused Of Fraud; or see Woman Accused In Mortgage Fraud Scheme (Kimberly Davis Charged With 14 Counts Relating To Identity Fraud).

------------------

For story update, see The Examiner: LS woman guilty of mortgage fraud ("Kimberly M. Davis, 42, pleaded guilty [December 19, 2007] to charges contained in a July 24 federal indictment. Davis admitted to using the names, social security numbers and birth dates of three separate victims, without their permission, to purchase two homes in Lee's Summit.").

North Carolina Mortgage Broker Loses License

The Charlotte Observer reports:

• "Matthews-based Hall Financial Services has lost its license and has agreed to reimburse consumers up to $250,000 in an agreement with the N.C. Commissioner of Banks and the N.C. Attorney General. [...] The NCCOB permanently pulled Hall Financial's mortgage broker license as well as the license of its owner James M. Hall. The agency's investigators found Hall originated mortgages without considering borrowers' ability to repay the loans and made misstatements on loan documents. More than 40 percent of loans originated by Hall Financial in a three-year timespan have gone into foreclosure."

For more, see Matthews mortgage broker loses license.

See also, U.S mortgage scammer losing own home to repay victims.

Go here for other posts on Hall Financial Services.

Beazer Homes Hitting More Turbulent Waters

(revised 8-11-07; 8-16-07)
The Charlotte Observer is reporting today:

• "Shares of Beazer Homes USA Inc. fell sharply Wednesday amid worries about the ability of builders to pay their bills as subprime lending woes expand to other parts of the market and push housing prices down. [...] As for the [federal investigations] involving the company, Beazer Homes previously disclosed that it received a subpoena from the United States Attorney's office in the Western District of North Carolina, seeking the production of documents focusing on the company's mortgage origination services. The investigation followed a March Observer series that found Beazer's mortgage arm arranged larger loans than some customers could afford, among other problems. The Observer found Beazer's sales practices contributed to an unusually high foreclosure rate in its Mecklenburg developments."

For more, see Beazer shares plunge on rumors.

For later stories, see:

• Beazer: Mistakes possible in filings (Company charges former accounting chief for having `caused' wrong figures) - (The Charlotte Observer - 8-11-07).
• Beazer Homes on review for downgrade due to accounting woes - Moody's (Forbes - 8-14-07)
• Beazer Homes Faces Problem After Problem (CNNMoney - 8-16-07)

Go here for prior posts and links to The Observer's investigative reports on Beazer.

Massachusetts Establishes Pro Bono Foreclosure Hotline

The following announcement came out of Massachusetts on Tuesday:

• "Massachusetts Attorney General Martha Coakley, in partnership with several bar associations, legal services organizations and advocacy groups, announced the establishment of a Pro Bono Foreclosure Assistance Hotline. Low-income Massachusetts residents who are facing foreclosure on their homes may call (800) 342-5297 or (617) 603-1700 and leave a message in the "foreclosure assistance" voice mail box. Each day, Legal Advocacy and Resource Center (LARC) will return the calls, determine how to best assist the caller and provide general advice. If the homeowner meets the eligibility criteria, LARC will refer the homeowner to Volunteer Lawyers Project (VLP), who will assign each case to a pro bono lawyer."

For more, see Massachusetts AG Press Release.

7 Charged In Alleged Cleveland-Area Straw Buyer Flipping Scam

The Cleveland Plain Dealer reports:

• "Seven people indicted Tuesday on charges of racketeering and conspiracy of mortgage fraud are the first targets of a task force formed to crack down on predatory lending in Cuyahoga County. Among those accused in the 65-count indictment are an unemployed single mother who bought five Cleveland houses in one day and two area property managers who investigators say sold nine rundown houses at inflated prices."

Forged and falsified documents were used to secure subprime mortgage loans from Argent Mortgage Co., (the same mortgage company that provided the loans - believed to be $18 million - in the alleged home improvement scam in the Tampa-St. Petersburg area of Florida recently - see Loan scam hits dozens).

The alleged ringleaders have been identified as Joan Shinkaruk, owner of Elite Investors Corp. of Parma, and Daryle Rutherford of J. Rutherford and Associates, a Cleveland area investment property management company. Each face 49 felony counts. Also indicted were straw buyers Angela Brown, David Crosby and Marvin Hill, along with Michael Wojciechowski, a partner of Shinkaruk, and real estate broker Chad Cook. For more, see 7 indicted in Cuyahoga predatory lending crackdown.

Mortgage Servicer Wins Again On Right To Represent Lenders In Foreclosure Actions

Law.com reports:

• "A federal judge has dismissed a proposed class action lawsuit filed by homeowners who cast doubt on the legitimacy of the nation's leading mortgage registration firm to represent lenders in foreclosures. U.S. District Judge Timothy J. Corrigan in Jacksonville, Fla., ruled that Mortgage Electronic Registration Systems did not misrepresent itself or hide its role as a nominee for mortgage lenders."

For more, see Federal Judge Rejects Homeowners' Lawsuit Against Major Mortgage Registry.

Three Tennessee Mortgage Brokers Sentenced To Federal Prison

The Chattanooga Times Free Press reports that former mortgage brokers Darren Todd Moyer (2+ years), Phillip Howard McKinnish (1+ year) and Jennifer Jewel Henson (1+ year) were sentenced on bank fraud charges in a Tennessee Federal Court last week. They were also ordered to pay $1.12 million in restitution. In April, they each waived their right to a jury trial and copped a plea instead. According to court records, the scheme involved the standard stuff - creating false and fictitious documents, preparing false loan applications and inflating the sales prices of multiple properties. For more, see Three sentenced for bank fraud.

New Defaults On Crisp & Cole Property Flips

(revised 8-5-07)
The Bakersfield Californian reports:

• "Four new defaults have rolled in for former Crisp & Cole Real Estate partners and spouses in less than a week, public records show. The latest default notices add more than $1.7 million in primary loans to a growing list of Crisp & Cole-related properties in some stage of foreclosure."

This story update involves the suspected property flips in the Bakersfield, California area involving David Crisp, Carl Cole, business associates and family members. For more, see New defaults for Crisp, Cole, records show (Cole says one of homes has offer on it already).

See also, Crisp & Cole defaults: Nightmare on Ordsall Street (Agent: Crisp & Cole took advantage of weak for gain) (The Bakersfield Californian - 8-4-07).

Go here for other posts on the Crisp & Cole ongoing saga.

Ohio Feds Charge Two With Bank & Bankruptcy Fraud In Alleged Intrafamily Flipping Scam

The Toledo Blade reports:

• "Federal prosecutors have charged two Lima, Ohio, real-estate investors with bank fraud and bankruptcy fraud, saying the men defrauded lenders of $2.2 million by “flipping” properties to inflate values, creating phony rental and purchase agreements, and failing to disclose the actual buyers and their debts. Charged in U.S. District Court in Toledo are Robert Frye and Matthew Ebbeskotte, who prosecutors say formed Skyway Partnership Investments LLC in 1999 and arranged for the purchase of 46 properties through falsified mortgage-loan documents. [...] Lima housing officials found “a pattern of purchases and foreclosures” that seemed suspect."

Not charged were the defendants' wives and parents, who allegedly also participated in the scheme. For more, see Bankruptcy fraud laid to 2 Lima men.

Misapplication Of Construction Funds Results In Consumers Paying Twice For Unfinished, Defective Homes

Florida Trend Magazine reports:

• "The fallout from the downturn in Florida’s housing market: More than 21,000 new foreclosure cases in June alone — up 144% from a year earlier — and a skyrocketing number of complaints against home builders over construction defects. Meanwhile, home builders in financial trouble have simply abandoned hundreds of customers, many of whom end up paying twice. “Contractors and consumers had both better hold onto their chairs,” says one attorney."

Among other things, the story highlights the practice by some in the construction industry of accepting deposits from customers (new-home buyers as well as existing homeowners desiring home improvements) and/or drawing down on customers' construction loans, and using the proceeds for things other than building the home or home improvement. In some cases, the builder or general contractor will simply "go out of business," stiffing in the process subcontractors or materials suppliers for labor and materials already provided. This results in mechanics liens being placed on the property, ultimately resulting in the customer either paying twice for an unfinished or defective home (or home improvement) or risk losing his/her home or building lot.

For more, see Left in the Lurch (Florida has one of the highest foreclosure rates in the nation. But the downturn in the residential housing market has left plenty of other problems in its wake, including increasing numbers of construction defects).

For related stories, see:

• Is the Bank at Fault? (Some banks release borrowers' money to contractors with little proof that the home under mortgage is actually being built), and
• Cutting Corners (Some owners are paying the price for homes built in a hurry during the boom years), and
• Victims of Great Bay Homes fiasco in PSL hope state comes to rescue.

Foreclosure Rescue Civil Lawsuit Reads Like A Federal Criminal Indictment

In reading through the recent class action lawsuit filed on behalf of three Maryland homeowners against Metropolitan Money Store and a number of others, the complaint reads much like a criminal indictment would read that was handed up by a Federal grand jury to a Federal prosecutor. For example:

1) reference is made to a "Foreclosure Reversal Program," which was the name that the defendants allegedly gave to the scheme they are accused of using to cheat financially strapped homeowners out of their home equity. The lawsuit describes this Foreclosure Reversal Program as "a criminal enterprise which was made up of an association in fact consisting of [several of the named defendants],"

2) the complaint accuses the defendants of "hav[ing] engaged in willful, systemic and widespread violations of the Federal Racketeer Influenced And Corrupt Organizations Act ("RICO"), ...",

3) accusations are made of payments of "illegal kickbacks and unearned fees", preparation of "false HUD-1s" by the two named title insurance agency defendants, and that the homeowners were "robbed blind",

4) the complaint alleges that "The systematic false representations on HUD-1 Settlement Statements in the transactions ... were designed to conceal the illegalities of the transactions, ..."

5) allegations are made of conduct constituting wire fraud and mail fraud, and that "the false HUD-1 Settlement statements were utilized to launder the money being paid to the RICO defendants for the purpose of evading taxes ..."

6) allegations are made of charging and collecting interest and compensation on the "Foreclosure Reversal Program" loans in an amount that violated state law.

The defendants in this case include two title insurance agencies which, among other things, allegedly acted as the settlement/closing agents in the foreclosure rescue transactions described in the lawsuit, and two title insurers, for their alleged failure to properly supervise the title insurance agents who issued the title policies and handled the closings.

The defendants in this case are: Metropolitan Money Store Corp.; Fordham and Fordham Investment Group, Ltd.; RTE Title & Escrow, LLC; Sussex Title, LLC - formerly known as Cap Title, LLC; Diane Linda Jones; Leticia Nicholls; Jamie Armand Clark; Joy Jenis Jackson; Kurt Fordham; Alexander Jamil Chaudhry; Valeria Tomlin; Jennifer McCall; Southern Title Insurance Corp.; Chicago Title Insurance Company; and fifty unknown individuals that are currently referred to in the lawsuit as John Doe #1 through John Doe # 50, inclusive.

For a copy of the complaint, see Proctor, et al. v. Metropolitan Money Store, et al. (no exhibits).

You can also go here for direct links to the lawsuit (76 pages - $2.40) and the 28 accompanying exhibits (50+ pages - $.08/page) on the U.S. Courts' PACER website. PACER registration required.

Go here for other posts on the Maryland foreclosure rescue class action, which now also covers those homeowners in Washington, D.C. and Virginia who were allegedly ripped off by the named defendants.

More On Maryland Foreclosure Rescue Class Action Lawsuit

The foreclosure rescue class action lawsuit filed last month in a Maryland state court was refiled in a Maryland Federal Court last week.

For a copy of the complaint, see Proctor, et al. v. Metropolitan Money Store, et al. (no exhibits).

You can also go here for direct links to the lawsuit (76 pages - $2.40) and the 28 accompanying exhibits (50+ pages - $.08/page) on the U.S. Courts' PACER website. PACER registration required.

Go here for other posts on the Maryland foreclosure rescue class action, which now also covers those homeowners in Washington, D.C. and Virginia who were allegedly ripped off by the named defendants. Joy Jackson

New Yok State Creates Mortgage Rescue Fund

The Buffalo News reports:

• "A $100-million refinancing program has been created by the state and the mortgage industry for people on the verge of losing their homes because of risky, adjustable-rate mortgages."

For more, see State creates $100 million mortgage rescue fund.

In a related New York foreclosure story, see Thompson Foreclosure Prevention Helpline Reaches Over 1,100 Calls (32 Percent of Calls Come from Brooklyn) (Brooklyn Daily Eagle).

Elderly North Dakota Woman Allegedly Ripped Off By Nephew, Home Sale Proceeds Unaccounted For

Reed Lloyd Satrom, 55, faces two felonies and stands accused of swindling his elderly aunt out of thousands of dollars, reports In Forum News. Satrom, in whom his aunt's trust was so strong that she granted him power of attorney three years ago – two years after being diagnosed with Alzheimer’s – allowing him to make her financial and legal decisions. According to the aunt's current legal guardian, when commenting about his inability to document where all of the aunt's assets went, “When you add up all the numbers it approaches half a million dollars. We don’t know where all the money went.” Included in the amounts unaccounted for is $225,000 representing the proceeds of the sale of her farm. For more, see Nephew accused of abuse of trust.

Go here , go here , and go here for other posts on elder financial abuse. yak

Minnesota Contractor Gets 9+ Years In Prison For $950K+ Swindle

The Star Tribune reports:

• "The scheme carried out by remodeling contractor Rick Gurewitz to swindle two families of nearly $1 million dollars was so abhorrent, a Hennepin County judge said Monday, that he doubled the prison time usually handed down for such crimes. Gurewitz, 41, the owner of Home Update Company, bilked one elderly woman out of her entire inheritance. He charged her $789,000 for substandard and overpriced work on a century-old 600-square-foot Minneapolis house."

For more, see Contractor gets double the sentence for swindling elderly (Rick Gurewitz told the judge that "pathologies," like gambling, made him do it. The judge was not moved).

Maryland Civil Jury Finds In Favor Of Foreclosure Rescue Operator

In a column by Eric Hartley, reported in The Capital, a civil jury found that there was not "clear and convincing" evidence that foreclosure rescue operator Loren Williams defrauded an Odenton, Maryland couple out of their townhouse in 2002. However, according to the column:

• "But the foreman read an extraordinary statement along with the verdict: Although we the jury did not find clear and convincing evidence of fraud on the part of the defendant, we do believe the defendant's business practices to be deplorable, unethical and unscrupulous."

The Maryland law regulating foreclosure rescue operators (Sections 7-301 through 7-321) which became effective in 2005, did not apply to this 2002 transaction.

One attorney familiar with Williams' business practices, reportedly commented that he believed Williams had victimized 200+ homeowners. Nevertheless, Williams is now "temporarily" out of business. He's reportedly serving 32 years in prison after admitting in 2005 to crimes not involving foreclosure rescue or other financial transactions. For more, see Justice not always about right and wrong.

Add Atlanta, GA, Maricopa County, AZ To List Of Metro Areas With "Green Pool" Problem

In Atlanta, Georgia, WXIA-TV Channel 11 is reporting that the local foreclosure problem in the metropolitan area is giving rise to homes that are left vacant and abandoned, and that those with untended pools are giving rise to a "green pool" problem. According to the story:

• "The problem with green pools is that very few people know that there is one behind the fences of vacant homes -- and because the pool is on private property, public health officials can't get involved until or unless there's a complaint from a neighbor. The Gwinnett Health Department said they will respond quickly to a complaint, because they understand the potential threat."It does pose a public health problem. Because again it can be harborage for mosquitoes" said a Health Department representative."

For more, see Foreclosures Turn Pools Green.

In Maricopa County, Arizona, The Arizona Republic reports:

• "Increasing numbers of newer Chandler homes are being abandoned by cash-strapped owners, leaving weeds, green pools and headaches for neighbors and city officials. "It's scaring me," neighborhood services Sgt. Greg Carr said of the trend. "We're trying to figure out how we can approach this, who do we call when homeowners walk away and we can't find them?" Carr doesn't have statistics but said home foreclosures are rising and along with them code violations. His counterparts in Mesa, Gilbert and Peoria said the phenomenon is affecting those municipalities, too."

For more, see Abandoned homes concern city officials.

String Of Suspicious Fires Hits Vacant Homes In One Upstate NY Town

In New York State, The Plattsburgh Press Republican reports:

• "A vacant house on The Portage in Ticonderoga burned to the ground early Thursday in what authorities believe was the third in a string of deliberately set fires. “They’ve all been vacant houses, at this point. But the next one could be occupied,” [said a police spokesperson]."

Of the three, at least one was in foreclosure; no word as to the foreclosure status of the other two, although they were currently being offered for sale. For more, see Ticonderoga house fire was third arson (So far only unoccupied homes have been burned). zebra

Foreclosed Home Filled With Mold, Claim Neighbors

In a story reported by nwi.com (The Times - Munster, Indiana), a home that a bank got stuck with after foreclosing on it is allegedly contaminated with mold, according to the neighbors living near the home. The residents said the mold from the home, which they said has been vacant since June 2005, is causing respiratory problems for neighbors and relatives with asthma and emphysema. The bank has not confirmed the presence of mold, but say they'll clean it if found. For more, see Bank pledges to clean house.

Feds Investigating Foreclosure Investment Seminar

WFOR-TV Channel 4 in Miami, Florida reports:

• "From documents filed with the government, [Channel 4] learned that the [Whitney Information Network] is being investigated by the Securities and Exchange Commission. The U.S. Department of Justice is looking into their marketing techniques, and they face several lawsuits alleging securities fraud. The Better Business Bureau has given them an unsatisfactory rating. In fact, the BBB says they've received more than 200 complaints against the company in the past three years."

The company, which is run by Russ Whitney, was in South Florida this week promoting their "Teach Me Foreclosure" seminar and Channel 4 went there to get some answers to questions about the ongoing Federal investigations.

For more, watch the WFOR-TV report, or to read the online story, see Feds Investigate Real Estate Seminar Company.

For a story on legal action taken against foreclosure seminars, see Illinois AG Sues Foreclosure Seminar Operator.

Subprime Lending Stories From Around The Country

The following are links to stories from around the country of homeowners getting in over their heads financially in transactions involving predatory subprime loans that reportedly involved questionable tactics by mortgage lenders and loan originators that made the loans. In each case, the homeowners appear to have relied on the "professionalism" with which the mortgage company employees held themselves out, only to find out that these particular people weren't reputable professionals at all, but merely agressive (and possibly unscrupulous) salespeople looking to sell a commodity that would yield themselves the most income.

To those reputable professionals in the mortgage lending industry, I'm sure you realize that the bad actors are ruining it for everyone. Industry credibility is hurting (see, for example, 2 In 3 Say Mortgage Ads Are Full Of Baloney, Says Poll). You better get your state regulators and professional organizations to do something about it quickly before the Federal government steps in and does it for you.

(Maybe one day the lending laws will change to (a) require uniform licensing requirements throughout the country and (b) create fiduciary responsibility on the part of the loan originators to the consumer - at least it will make it that much easier to keep some of the unscrupulous bad actors out of the industry, and it will also make it easier to go after those that do get in and hammer them and the companies employing them in a court of law.)

New Hampshire - Subprime mortgage saga: Home gone, inheritance lost.

California - Anatomy of a foreclosure (Creative financing, questionable loans leave woman mired in debt).

California - Lenders taking advantage of elderly.

Minnesota - 'I got burned. It's outright fraud.'

Brooklyn, NY - Subprime Woes Hit B'klyn (Local Couple Face Mortgage Hard$hip).

Oregon - Trapped by a house (Predatory lending ravages a family).

Congress Mulling Changes In Servicemembers' Civil Relief Act ("SCRA")

Stars and Stripes reports:

• "The SCRA gives broad financial and legal protections to active-duty troops and their families. The legislation was originally written in 1940 but revised in 2003 to put greater emphasis on Guardsmen and reservists who found themselves serving in overseas operations. ... Lawmakers are considering more than a dozen changes to the bill, covering issues such as preventing child custody changes while troops are deployed and allowing troops to suspend their cell phone accounts while they’re overseas."

One change being considered is to impose a delay on a foreclosure of a servicemember’s home until at minimum one year after they return from combat, much longer than the current 90-day wait under the act. For more, see Congress eyes changes to troop protection act (Legal, financial rights of deployed servicemembers being reviewed).

Go here for other posts on the Servicemembers' Civil Relief Act. For financial assistance for Pennsylvania families of deployed servicemembers, see Center gets additional funding to help military families.

Indiana Alleged Flipping Fraud "Right Out Of The Sopranos," Say Investigators

The Indianapolis Star reports:

• "Marion County prosecutors charged nine Indianapolis landlords with welfare fraud and theft this week, characterizing their operation as a sophisticated criminal enterprise that bilked nearly half a million dollars from the government and possibly millions more from private lenders. Investigators described a scheme involving numerous shell companies and at least nine partners -- a point man and eight "straw buyers" -- who flipped about 100 homes in poor neighborhoods, illegally enrolled them in the federal Section 8 housing program for the needy and let them sink into default."

The pending charges relate to allegations of lying to the government when enrolling in the Section 8 rental subsidy program. No charges have been brought in connection with mortgage fraud. Unclear is if the theft charges against the suspects relate to rent skimming (equity skimming) whereby they allegedly pocketed the HUD-subsidized tenants' rentals without making payments on the existing mortgages, the allegations of stripping of items of value from some of the homes when they became vacant, or the charges of taking of government money under false pretenses.

"It's right out of 'The Sopranos' -- season four, episode seven," said one investigator. A prosecutor commented, "I watched the episode ... and the only difference is the Sopranos burn the places down for the insurance money; in our cases, the houses were stripped " [of copper wiring, appliances and anything else salvageable]. Additional charges have not been ruled out, according to a prosecutor.

Those charged are: Anthony T. Moorman, 42, Kameron A. Beckum, 24, Jason A. Boyd, 36, Lawrence J. Howard Jr., 22, Corey J. Jones, 33, Walter J. Powell, 30, Keith L. Thacker, 35, John White Jr., 21, and John A. Williams Jr., 38. For more, see 9 charged with fraud in housing scheme (Section 8 program was bilked out of $472,624, prosecutors say).

Go here for other posts on this story.

Texas Cops Investigating Equity Skimming Allegations

WCEN-TV Channel 6 in Temple, Texas reports on a company called T.O.P.S. (Take Over Payment Services) which is in the business of acquiring homes from people who can't afford their existing payments, and once the homes are signed over to T.O.P.S., the company then reportedly sells the homes to others in arrangements where the new buyers make monthly payments to T.O.P.S., and it agrees to make payments to the mortgage lender holding the loan on the home.

The way the deals allegedly went down is that the owner-occupants of the homes bought from T.O.P.S. unwittingly made the monthly payments to T.O.P.S. while T.O.P.S. pocketed the cash, letting the mortgage loans go into default. The Better Business Bureau has reportedly received over 100 complaints against T.O.P.S. and the Killeen Police Department is also investigating T.O.P.S. for fraud. NBC 6 News tried to reach the owners, Shonda Fulcher and Bobby Fulcher, numerous times, but they refused an interview, and their building is now empty.

For more, watch the Channel 6 report. To read the online report, see Additional complaints filed against a Killeen business.

For update on this story, see Police still investigating TOPS theft claims (Killeen Daily Herald - 8-10-07).

For other stories on tenants unknowingly renting homes in foreclosure, go here, or here, or here. alpha

Cash Back Mortgage Fraud Allegations Mount Against Suspended Connecticut Attorney

The New Haven Independent reports:

• "A judge this week extended a suspension of [New Haven attorney Morris] Olmer's license to practice law, as allegations mount that he worked with a West Haven appraiser to cheat mortgage lenders by inflating values of home sales throughout the region."

The allegations are being made in administrative proceedings by the section of the Connecticut judiciary that handles invetigations and discipline of Connecticut attorneys. The allegations being made are of conduct that is pretty standard in your typical cash back mortgage fraud (ie. inflated purchase prices and appraisals, use of double HUD-1 "technique", use of same appraiser on the six transactions that are being investigated). The allegations came from Mortgage Lending Network, who was the mortgage lender who claims to have been duped into financing all six transactions. Reportedly, local resident Thomas Gallagher, a buyer who Olmer represented in one transaction, also is accused of owning the appraisal firm that performed the allegedly inflated appraisals for all six deals.

In addition to the administrative investigation, the state reportedly disclosed that there is also a criminal case pending against attorney Morris Olmer. For more, see Lawyer Battles Rip-Off Charges.

Two New York Attorneys Charged With Stealing Escrow Funds

The North Country Gazette reports:

• "Two Nassau County attorneys have been arrested in connection with separate thefts of more than $900,000. Barry Chasky, 54, of Point Lookout, has been charged with second degree grand larceny after allegedly embezzling nearly $900,000 from the escrow accounts of First American Title Insurance Company. In a separate case, Joseph Corrado, 48, of Pleasantville, has also been charged with third degree grand larceny in connection with an alleged theft from the escrow account of a Garden City client who hired the defendant to negotiate a loan refinancing."

Chasky is the owner of Triad Abstract Company, which is an agent of First American Title Insurance Company.

Corrado was hired to negotiate a loan modification for a local homeowner who was in default on his home mortgage. Allegedly, the homeowner gave Corrado a total of $35,000.00 to hold in escrow during the negotiations, who reportedly pocketed the money, doing little more than filing a notice of appeal during the process. To date, Corrado has returned only $4,000, creating a financial loss of $31,000 to the homeowner, according to the story. A foreclosure action resulted in the home being sold at auction.

For more, see Legal Duo Charged With Theft Of Escrow Funds.

See also, Nassau County District Attorney press release - DA Files Charges against Two Lawyers (In separate cases, attorneys accused of stealing more than $900k).

Go here for stories on other alleged escrow agent mishandling of funds. sneaky slick escrow agents alpha

More On Media Investigation Of Alleged Bakersfield Flipping Operation

KBAK-TV Channel 29 in Bakersfield, California has their own coverage of the alleged intra-family home flipping operation involving real estate agent David Crisp, the now defunct real estate company, Crisp & Cole, and company associates. For their report, watch the KBAK-TV report; or to read the online story, see More questions for David Crisp.

Go here for other posts on David Crisp.

86 Year Old Ohio Woman Ripped Off By Foreclosure Rescue Service; Demands Full Refund

WKYC-TV Channel 3 in Cleveland, Ohio reports on Sadie Booker, an 86 year old woman holding down three jobs who was facing foreclosure on a predatory mortgage loan on her home. She paid a $500 upfront fee to Foreclosure Solutions and Mediation and Michael Shafran, a local foreclosure rescue service in Macedonia who reportedly told her they can stop the sheriff's sale. A week before the sale, they sent Sadie a letter informing her that they would be unable to help her. When she asked for a refund, they refused, saying that they get $100 an hour for their time.

Fortunately for Sadie, a member of ACORN stepped in at the last minute and reportedly was able to stop the foreclosure of the predatory mortgage on her home at no cost to her. Feeling energized by the last minute reprieve, she, backed by a gang from ACORN (and presumably a WKYC cameraman trailing behind capturing the events on video), marched over to Shafran's house demanding all of her money back.

To see what happened, watch the WKYC-TV Channel 3 report (no longer available online), or to read the online report, see Homeowners facing foreclosure are targeted again.

For a story of another Ohio foreclosure rescue service, this one being sued for allegedly ripping off homeowners out of an $1,150 upfront fee, see Foreclosure Rescue Service Sued In Cincinnati For Alleged Failure To Provide Promised Services.

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New Hamphire Woman Gets Go-Ahead In Suit Against Ameriquest

Amherst, New Hampshire resident Rosemary Gilroy, who filed a federal suit against Ameriquest alleging that they engaged in predatory lending practices, received a favorable ruling this past Monday in a Concord Federal Court allowing her to "proceed on her case without an attorney and bring the nation’s largest subprime lender into court, because, if what she alleges is true, it could be in violation of state and federal law," according to the Nashua Telegraph. Reportedly, it is her position that, if eligible for a share of a $325 million predatory lending settlement Ameriquest has entered into with 49 states, that share would average around $250, and she's not interested. For more, see Amherst woman sues lender.

Jury Awards Arizona Couple $1 Million Due To Ameriquest Mortgage Screw-Up

The Arizona Daily Star reports:

• "A jury has awarded more than $1 million to a now-divorced Tucson couple who lost their home after trying to refinance a mortgage through Ameriquest Mortgage Co. The lender, which also is facing $295 million in restitution payments for predatory lending practices, led homeowners Ronaldo Rodriguez and Jodi Aguirre-Rodriguez to believe they had refinanced the loan for their single-family home in Midvale Park, according to a complaint filed in the suit. But the loan wasn't approved, and the couple didn't learn that until their previous lender, Bank of America, foreclosed on the house, and it was purchased at auction by an investor, according to the complaint."

For more, see Tucsonans awarded $1M in bungled loan.