850+ FHA Loans Originated In Alleged Scam End Up In Foreclsoure; Six indicted
- Four San Bernardino County residents and two other people have been indicted in a mortgage fraud scheme that federal officials said cost the government and private lenders more than $10 million.
- John Richard Varner, 54, of Hesperia; Stephen Ray Harper, 50, of Ontario; Katherine Ann Kilmer, 52, of Hesperia; Ricardo Bonilla, 46, of Fontana; Abraham Julian Rezex, 59, of Downey; and Richard Elroy Giddens, 67, of Riverside face federal charges of conspiracy, bank fraud and tax violations, according to a news release issued by the Department of Justice.
- Investigators with the Department of Justice said that from 1997 to 2002, all six ran a scheme out of the Mortgage One Corporation, formerly based in Hesperia, and M-1 Capital Corporation, formerly based in Riverside and Rancho Cucamonga. The companies had been in the business of approving, funding and then selling home mortgage loans, Assistant U.S. Attorney Sheri Pym said. Many of those loans were insured through the Federal Housing Administration, an agency within Housing and Urban Development.
- HUD has since identified more than 850 FHA-insured loans approved by Mortgage One and M-1 Capital that went into foreclosure and made insurance claims to HUD. The estimated losses suffered by the government and the private lenders are at least $10 million, officials said.
For more, see 6 indicted in mortgage fraud (Officials say scheme cost government, lenders $10M).
See also, U.S. Attorney Press Release.