Feds File Civil, Criminal Charges Against Promoters In Alleged "Ponzi-Like, Foreclosure Reinstatement" Scam

In Los Angeles, California, the U.S. Securities & Exchange Commission announces:

• The Securities and Exchange Commission [Wednesday] filed securities fraud charges against the promoters of an $18 million real estate investment scheme targeting the African-American community in the Los Angeles area and other locations in Nevada and Georgia.

• The SEC's complaint, filed in U.S. District Court in Los Angeles, charges Jeanetta M. Standefor, a 40-year-old resident of Altadena, Calif., and her Pasadena, Calif.-based company Accelerated Funding Group (AFG) for operating a fraudulent "foreclosure reinstatement" scheme that attracted more than 600 investors between 2005 and 2007. The scheme purported to use investors' funds to cure defaults on distressed properties owned by others. The SEC alleges that while soliciting investor money and promising returns of up to 50 percent within 30 to 45 days, Standefor and AFG were instead operating a Ponzi-like scheme that used money from new investors to pay previous investors. Standefor also used more than $1.9 million of investor funds for personal expenses such as her lavish wedding and honeymoon, cars, jewelry, tickets to entertainment events, and home renovations. Standefor and AFG also misused investor funds to pay $121,000 in "consulting fees" to Standefor's husband, Darrell R. Dansby.

• In a related action [...], the U.S. Attorney's Office for the Central District of California announced that Standefor was arrested by special agents with the Federal Bureau of Investigation on criminal charges related to the AFG offering. [Tuesday], a federal grand jury in Los Angeles returned an 11-count indictment charging Standefor with wire fraud, mail fraud, and money laundering.

For more, see SEC, U.S. Attorney Charge Promoters of Real Estate Scheme Targeting African-American Community.