Wednesday, March 19, 2008

California Authorities Bust Up Alleged "Bait & Switch" Predatory Lending Scam Operation, Thousands Victimized

In San Bernardino County, California, the Los Angeles Times reports:


  • State and local prosecutors said Tuesday that they had shut down a mortgage fraud ring that allegedly victimized thousands of seniors and others, some of whom lost their homes. The San Bernardino County district attorney's office arrested five people and were waiting for two more to surrender to face charges of conspiracy, grand theft and elder abuse as part of a crackdown on alleged sub-prime mortgage lending scams with the California Department of Justice.

  • A related [California AG civil] lawsuit filed in Los Angeles County Superior Court accuses six companies of using predatory lending practices to trap homeowners in illegal and expensive loans.

***

  • The six companies -- Lifetime Financial Inc., Nations Mortgage Inc., Greenleaf Lending Inc., Virtual Escrow Inc., Olympic Escrow and Direct Credit Solutions Inc. -- were operated by Eric Michael Pony, 25, of Tarzana and family members, the lawsuit said. In a coordinated action, San Bernardino Dist. Atty. Michael A. Ramos announced that Pony, a former real estate salesman, was expected to turn himself in to authorities Tuesday. [...] Also expected to surrender was his sister, Paulette Pony, 23, of Tarzana, a notary public for Lifetime Financial. The California secretary of state's office lifted her license in December in connection with felony conspiracy charges and for failing to disclose a forgery conviction.

***

  • The criminal and civil actions against the Pony family members and associates and their companies are believed to be the most ambitious by law enforcement since California's once-booming housing industry was hit last year by a crippling downturn that made it difficult for tens of thousands of borrowers to pay soaring sub-prime mortgages with adjustable interest rates. Brown said it was only the first of several legal actions planned to fight mortgage fraud.

For more, see State breaks up alleged sub-prime fraud ring (5 are arrested and 2 sought, accused of victimizing thousands of Californians, some of them elderly and some who lost their homes).

For story update, see Final two suspects in real estate fraud case surrender to authorities:

  • The company used telemarketers to sell inflated real estate loans with high fees, using forged documents and crooked escrow agents and notaries. Most of the victims were elderly or did not speak English. [...] Also held are Jacob Shawn "Coby" Franco, 46, of Encino; Eli Hassine, 25, of Sherman Oaks; Carol Binnie Pencille, 57, of Granada Hills; Sibpun Ampornpet, 31, of North Hollywood; and Jason Imperial Burbidge, 35, of West Hills.).

For additional background information on this case, see:

Story update (7-22-08):

Go here for story updates.

posted by Home Equity Theft Reporter at 9:36 AM