Nationwide Foreclosure Rescue Operator Charles Head Back In The News

Another story on national foreclosure rescue operator under Federal investigation, Charles Head, has come out; this time coming from Sacramento, California, where The Sacramento Bee reports on his local operations:

• [Head's] alleged scam includes at least seven Sacramento homeowners and 61 statewide, and the probe is based in the Sacramento FBI office, according to court documents, interviews and an Internal Revenue Service search warrant obtained by The Bee. An additional 100 investors who believed they were helping people on the brink of foreclosure also may have been swept up in the alleged scheme, with many having their credit ruined.

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• [F]ederal authorities say the [investigation] has evolved into money laundering, and Head says the FBI has seized cash and exotic vehicles from him. "We're still reviewing the evidence we got from searches in Los Angeles," Sacramento FBI spokesman Steve Dupre said. "We're still attempting to identify more victims and put the pieces together."

The deals sound like the typical sale leaseback, equity stripping, "straw buyer" arrangements. Head's deals were reportedly described by one New Jersey attorney who has filed a civil lawsuit against Head:

1. Homeowners were told they could sign their house over to a trust and live there while repairing their credit,
2. They would pay monthly rent to Head's companies and, after a year or two, could buy back their home at about the same price,
3. Head recruited "straw buyers" to take title to the homes in the equity stripping transaction without any management responsibilities; they simply would lend their good credit to the deal in return for "straw buyer" fees of between $5,000 to $40,000.
4. The investors were told they didn't have to make mortgage or tax payments because Head's companies would pay the mortgages,
5. The investors found out the mortgages had not been paid when they started getting default notices in the mail.

For more, including some of the reported details involving a couple of the Sacramento-area homeowners who were allegedly victimized by Head's deals as well as the Federal asset seizures of property confiscated from Head, see Home scam suspected (Local FBI office heads 'foreclosure rescue' fraud probe).

Go here for other posts on the Head nationwide foreclosure rescue operation.