Feds Convict Six In Atlanta-Area Mortgage Fraud Trial

In Atlanta, Georgia, the Atlanta Business Chronicle reports:

• A federal court jury has found several Atlantans guilty for their roles in a mortgage fraud ring that racked up $6 million in just 10 weeks from SunTrust Mortgage. Guilty verdicts came in late Monday against Keith Garner, 48, Gregg Savage, 24, Shalonda Harris, 36, all of Atlanta, and Latesha Garner, 27, of Durham, N.C., on charges of conspiracy to commit mortgage fraud and wire fraud related to $6 million in fraudulent real estate financing from SunTrust Mortgage Co. in summer 2006.

***

• According to court evidence, Keith Garner solicited his daughter, Latesha Garner, a loan processor with SunTrust Mortgage, [...] to handle fraudulent loan applications submitted on behalf of straw borrowers he recruited with co-conspirators. Because she was responsible for verifying borrower employment and asset information and approving closing documentation, Latesha Garner was uniquely positioned to defraud SunTrust Mortgage, which she did by falsely verifying borrower credentials and approving hundreds of thousands of dollars in false payoffs to her father. Keith Garner paid Latesha Garner $33,000 -- a year's salary -- across four transactions to run the scheme.

For more, see Metro Atlanta mortgage fraud ring convicted.

Feds Indict Three More In Erie, Pa. Mortgage Fraud Probe

In Erie, Pennsylvanis, the Erie Times News reports:

• Three Erie County men now face charges of fraud and conspiracy as part of the ongoing federal investigation into a widespread mortgage scam in Erie. U.S. Attorney Mary Beth Buchanan announced Tuesday the defendants were indicted by a federal grand jury in relation to the probe. Indicted Tuesday were Gregory M. Finney, 34, of [...] Erie; Francis R. Conti, 41, of [...] Waterford; and 49-year-old Keith A. Rice, of [...] Harborcreek Township. The government's 17-count indictment alleges that Finney, Conti, Rice and others were part of a scheme in which they bought run-down houses and sold them at artificially inflated prices. The buyers were mostly low-income people who knew little about how to buy a home.

***

• Erie businessman Robert L. Dodsworth, 60, pleaded guilty to conspiracy and money-laundering charges related to the case in November. [...] His business partner, Frank Kartesz II, 39, of Harborcreek, was charged with fraud and conspiracy counts on Jan. 31. Kartesz was expected to plead guilty in federal court in Erie on Thursday, but federal officials said that hearing could be postponed. [...] Dave Pesch, the housing counseling manager at Erie's St. Martin Center Inc., said the case shows how widespread mortgage fraud is in Erie. Pesch's agency assists low- and moderate-income homebuyers and worked with dozens of clients caught up in the probe.

For more, see More mortgage charges (3 more indicted by federal grand jury in ongoing fraud case).

Go here for other posts related to the Erie, Pa. FBI mortgage fraud probe. Robert Dodsworth Pennsylvania

Florida Ameriquest Lawsuit Alleging Title Insurance Homeowner Ripoff Now Certified As Class Action; Damages Could Exceed $13M

In Pinellas County, Florida, The Miami Herald reports:

• A lawsuit that alleges lender Ameriquest Mortgage overcharged for title insurance on home refinancings can proceed as a class action, a state judge ruled. Coral Gables lawyer Richard Bennett, who filed the lawsuit in Pinellas County in 2006, estimates the class involves about 66,000 Floridians who refinanced their homes with Ameriquest from May 19, 2002 through 2006. Instead of charging the lower ''reissue rate'' for title insurance on refinancings, the suit claims, Ameriquest collected the higher rate charged on home purchases. Bennett said the overcharges on the policies he has reviewed generally have ranged from $200 to $300 per customer. Assuming that range is typical for the class, the potential damage claims could exceed $13 million.

***

• The lawsuit may be the first filed against a lender for overcharges on title insurance, Bennett said. Several class-action lawsuits were brought against title insurance companies in recent years, with some leading to out-of-court settlements. Ameriquest was the only party sued in the Pinellas County case because it collected the title-insurance costs from the loan proceeds, which it then sent to title agents. ''We didn't follow the money,'' Bennett said in explaining why Ameriquest was the only defendant.

For more, see Title insurance overcharge suit advances (A lawsuit that accuses Ameriquest Mortgage of overcharging for title insurance on home refinancings has been certified as a class-action) (story no longer available online).

Go here for other posts involving legal issues related to title insurance. title insurance legal issues

Seven Cop Pleas In South Florida "Cash Back" Straw Buyer Mortgage Fraud Scheme

On Monday, the U.S. Attorney for the Southern District of Florida announced the guilty pleas of seven assorted scam artists who participated in a scheme through which they located properties for sale in the Southwest Ranches area of Broward County, Florida, fraudulently purchased the properties using straw buyers, and then received cash back at the closings. This scheme yielded 12 fraudulent loans, totaling approximately $8,300,000, according to the U.S Attorney's office.

Those copping pleas (and the dates of their pleas) were:

• Maykel Clavero-Gonzalez, 30, of Miami, (January 7, 2008); Luc Bruna, 53, Fort Lauderdale, (January 10, 2008); Ruben Jimenez, 40, of Miami, (January 11,2008); Iliana Lima, 36, of Port St. Lucie, (January 11, 2008); Antonio Ramos, 26, of Miami, (February 5, 2008); and Michele Volcy, 47, of Fort Lauderdale, (February 8, 2008), and Joaquin M. Perea, 63, of Miami, (February 11, 2008).

For more, see the U.S. Attorney news release: Additional Defendants Plead Guilty In "Operation Fastbuck" Mortgage Fraud Scheme.

Go here for the original U.S. Attorney Press Release announcing the original indictment; and go here for the original Indictment.

Bail Set At $1.64M For California Man Facing Foreclosure Fraud, Forgery, Rent Skimming Charges

In Santa Clarita, California, KHTS Radio AM 1220 reports:

• A Mission Hills man already facing criminal charges involving alleged real estate foreclosure and investment fraud was charged Friday with several more felony counts, including grand theft, identity theft and forgery involving many victims in Santa Clarita. James Anthony Rojas, 51, faced 82 counts, all but three of them felonies. The misdemeanor counts allege rent skimming. Most of the crimes involve real estate foreclosure fraud, in which Rojas allegedly forged grant deeds to take over victims’ homes. Some of the victims had gone to Rojas for help with mortgage problems; most didn’t even know him until the forged grant deeds appeared.

For more, see Real Estate Advisor Faces 82 New Felony Counts (go here for .pdf version).

Go here and go here for other posts on deed theft by forgery, swindle, etc. deed theft yahtzee equity skimming unwittingly gamma foreclosure rescue

Suit Alleges KB Home, Countrywide Conspiracy With Appraisers To Inflate Home Prices, Class Action Status Sought

In Los Angeles, California, The Associated Press reports:

• Two California couples are suing KB Home (KB) and mortgage lender Countrywide Financial Corp., claiming the companies schemed with real estate appraisers to inflate prices paid for homes as the housing market began to tank. [...] The plaintiffs, Deborah and Lonnie Bolden, and David and Dolores Contreras, all residents of Live Oak, are seeking unspecified restitution as well as compensatory and punitive damages. They also want class-action status to cover KB Home customers in California who obtained financing through Countrywide and closed on their purchases between Aug. 1, 2005, and July 31, 2006. In the lawsuit, the couples claim prospective home buyers were presented with false or misleading data on previously sold homes in order to justify higher asking prices on new purchases.

For more, see Lawsuit claims KB Home, Countrywide inflated home prices.

See also, San Francisco Chronicle: A Court Case That Could Be A Sign of the Times (3-21-08).

Go here, Go here and Go here for more on recent Countrywide problems with consumers.

Federal Appeals Court Reverses Denial Of Class Action Status In Realty "Junk" Closing Fee Suit

Syndicated real estate columnist Kenneth Harney recently wrote:

• Just about anybody who bought a home or took out a mortgage in the past five years has run into them in some form: mysterious fees from realty brokers, lenders, builders and title agents — "admin", "processing," "doc-prep" and "regulatory compliance" among some of the opaque names — that lumped $200 to $500 extra onto the consumer's bottom line at settlement. [...] Now a federal appellate court has weighed in with a decision involving a realty firm's $149 mandatory add-on fee, and a home buyer who filed suit to challenge it. The 11th U.S. Circuit Court of Appeals reversed a lower court's denial of class-action standing in the suit by Vicki B. Busby of Jefferson, Ala. The class action is intended to cover all consumers forced to pay what the brokerage firm termed its "ABC" fee -- an administrative brokerage commission.

• Busby filed suit against RealtySouth, a large Birmingham-based broker, charging that in addition to paying a substantial commission to the firm and its sales agent, she was nonetheless required to pay the ABC fee. Busby said there was no evidence that the firm had actually performed any extra services -- above and beyond the brokerage services compensated by the commissions -- and therefore the ABC fee violated federal law. The appeals court ruled that the lower court had erred in not considering the factual issue -- was any specific work done to justify the extra charge? -- in making its decision to deny Busby's request for class-action certification.

***

• In an interview, [Washington, D.C. attorney Phillip L.] Schulman said the court's ruling is not the final word on the matter, but it "underscores the importance of performing actual services in exchange for" fees charged in connection with real estate and mortgage transactions. In other words, a brokerage firm cannot simply dream up new fees and force them upon their unwitting clients. Many brokers have imposed extra charges because their sales agents demanded higher splits of the listing and selling commission dollars.

For more, see Brokerage fee lawsuit is revived.

To view the Federal appeals court decision, see Busby v. JRHBW Realty, Inc. (doing business as Realty South) - decided 1-17-2008.

See also, Transaction Fee Scrutiny Creates Uncertainty.

Maryland Lawmakers Move To Cap Legal Fees, Increase Debt Threshold In Tax Sales

In Maryland, The Baltimore Sun reports:

• In an effort to spare some homeowners the loss of their properties in municipal tax sales, lawmakers are proposing several reform measures. State Sen. George W. Della Jr. has introduced legislation to cap legal fees at the end of the court process and to improve notification. The Baltimore Democrat says he hopes to cut expenses and save homes.

***

• The proposed law would cap attorney fees at $500 until a suit to foreclose the right of redemption is filed. Then "reasonable attorney fees" may be sought, not to exceed $1,000. State Sen. Richard Madaleno [...] has proposed a bill to raise the debt threshold for properties sent to tax sale from $100 to $500. [...] Del. Maggie L. McIntosh [...] said that she expects to take up legislation to lengthen the amount of time before a foreclosure results from a tax sale once notice is given, and possibly on changes to the way the city bills its residents. "We want to make sure that the city does everything it can to avert a resident from losing a home due to a water bill," McIntosh said.

***

• Baltimore lawyer Jay A. Dackman, who has been among the city's active lawyers in tax-sale cases, said he would welcome greater control of fees. "The law the way it's currently drafted is too open-ended," he said. "It creates abuse in terms of excessive fees being charged by attorneys."

A recent Baltimore Sun investigation showed that at least 400 homes were lost in a recent three-year period by Baltimore homeowners for debts other than property taxes, and that half were for unpaid municipal charges of $500 or less, many of which included unpaid city water bills.

For more, see Lawmakers propose reforms to state tax-sale regulations (Bills would cap attorney fees, raise debt threshold for action). bidding

Unpaid Water Bills Lead New Haven's WPCA To Go On Home Foreclosure Rampage

In New Haven, Connecticut, the New Haven Independent reports:

• The WPCA continues its foreclosure tear in New Haven. The mayor remains silent. The agency — the quasi-governmental Water Pollution Control Authority — filed eight new lawsuits in State Superior Court on Jan. 14 and 15 to snatch New Haven properties for unpaid bills as low as $1,235. That brings to over 130 the minimum number of New Haven homes the WPCA has filed suit to foreclose on since New Haven relinquished control of the agency in mid-2005 and it became a suburban-controlled independent entity.

For more, see 2 Days, 8 Foreclosure Suits.

For an earlier New Haven Independent article on this story, see WPCA Goes On Foreclosure Binge.

Credit, Housing Crisis Now "Sucking In All Borrowers"

The New York Times reports:

• The credit crisis is no longer just a subprime mortgage problem. As home prices fall and banks tighten lending standards, people with good, or prime, credit histories are falling behind on their payments for home loans, auto loans and credit cards at a quickening pace, according to industry data and economists. The rise in prime delinquencies, while less severe than the one in the subprime market, nonetheless poses a threat to the battered housing market and weakening economy, which some specialists say is in a recession or headed for one. Until recently, people with good credit, who tend to pay their bills on time and manage their finances well, were viewed as a bulwark against the economic strains posed by rising defaults among borrowers with blemished, or subprime, credit. “This collapse in housing value is sucking in all borrowers,” said Mark Zandi, chief economist at Moody’s Economy.com.

For more, see Mortgage Crisis Spreads Past Subprime Loans.

Wachovia Profited By Knowingly Providing Banking Services To Alleged Telemarketing Fraudsters, Says Report

The New York Times reported last week:

• Last spring, Wachovia bank was accused in a lawsuit of allowing fraudulent telemarketers to use the bank’s accounts to steal millions of dollars from unsuspecting victims. When asked about the suit, bank executives said they had been unaware of the thefts. But newly released documents from that lawsuit now show that Wachovia had long known about allegations of fraud and that the bank, in fact, solicited business from companies it knew had been accused of telemarketing crimes. Internal Wachovia e-mail, for example, show that high-ranking employees at the nation’s fourth-largest bank frequently warned colleagues about telemarketing frauds routed through its accounts. Documents also show that Wachovia was alerted by other banks and federal agencies about ongoing deceptions, but that it continued to provide banking services to multiple companies that helped steal as much as $400 million from unsuspecting victims.

For more, see Papers Show Wachovia Knew of Thefts.

Mortgage Servicing Companies Reluctant To Work Out Loans With Financially Distressed Homeowners

ABC World News Tonight ran a story last Friday regarding the reluctance of mortgage loan servicing companies to work out home loans for homeowners in financial trouble.

The reason: According to the ABC story, mortgage loan servicers are not set up as a customer service business. The personnel is both overwhelmed with the number of cases of homeowners in financial trouble and they are under-trained for working out the loans. The servicing companies also have no financial incentive to work out the loans. In fact, the loan servicing business actually becomes more profitable for the companies when home loans go into default, allowing them to clip homeowners in trouble with late fees and other default-related charges. In addition, the mortgages are turned into securities bought by investors around the world who do not negotiate with individual homeowners.

For more, watch Demystifying the Mortgage Mess.

Go here , go here , and go here for posts on questionable mortgage servicing practices. questionable mortgage servicing practices tactics xero

Fight With Mortgage Servicer Complicated The Rough Times For Central Florida S&L

In Central Florida, the Orlando Sentinel reports:

• It's not a stretch to say that these have been the worst of times for Federal Trust Bank. The Sanford-based savings and loan -- and the only publicly traded financial institution headquartered in Metro Orlando -- is grappling with a litany of troubles triggered by the housing and mortgage crisis. Of course, it is not alone. From Citigroup to SunTrust, most major financial institutions have fallen prey to the peculiar boom-and-bust losses of the subprime mortgage meltdown and its resulting investment fallout. But it is still rare for a community bank or thrift to take the kind of hits Federal Trust has taken.

***

• Complicating matters last year, Federal Trust became ensnared in a messy lawsuit against its loan servicer Transland Financial Services Inc., which allegedly misappropriated more than $2 million in loan payments. Federal Trust was one of a trio of creditor banks that sued Maitland-based Transland last summer in an attempt to force it into bankruptcy and recover about $22 million in unpaid mortgage proceeds. The creditors later settled on a repayment plan with Transland.

From: Federal Trust is looking for turnaround.

Go here , go here , and go here for posts on questionable mortgage servicing practices. questionable mortgage servicing practices tactics xero

Two Vero Beach New Home Developments In Foreclosure; Leave Lenders, Subs, Homebuyers In The Lurch

In Vero Beach, Florida, TC Palm reports:

• A 106-home development started during the real estate boom has landed in court, leaving homebuyers and subcontractors out of tens of thousands of dollars. Seacoast National Bank has sued to foreclose on Eagle Trace, a 40-acre subdivision [...] . The lender also is suing developer Mizner Grande of Vero Beach and related companies, and their principals, Richard F. Rendina of Palm Beach Gardens and Stephen Siegel of Boca Raton. Seacoast charges that Mizner Grande failed to repay loans and credit lines totaling $27 million and file timely financial statements and tax returns. The suit, filed late last month, also alleges Mizner failed to resolve $1.2 million in property liens, most filed by subcontractors seeking payment. The bank asked the court to appoint a receiver to manage the property.

***

• Mizner Grande has sold 43 of the 57 homes in the first phase of the project nearest 58th Avenue. Several are now built and occupied. Mizner has started only 19 of the 49 homes in the second phase and has sold none, Rendina said.

***

• Separately, Rendina and Siegel and their company, San Messina 23 Realty LLC, face foreclosure on a 22-home project, the Enclave, just north of Eagle Trace on 65th Street. Colonial Bank contends in a separate suit filed in August of last year that the developers defaulted on an $8.2 million loan. No homes in that one-street project are finished. Several homebuyers in Eagle Trace have sued Mizner Grande, attempting to recover their deposits. At least three homebuyers have filed complaints against Mizner Grande with the state Attorney General's Office, claiming Mizner refuses to return their money.

For more, see 40-acre new home project in jeopardy in Vero Beach.

For story update, see Lawsuit alleges bank breached its duty, made false promises in Indian River County.

For other posts on builders & contractors accused of stiffing customers & subcontractors, go here and go here. contractors stiff subs customers zeta

Pennsylvania Homeowner, Deutsche Bank Settle Foreclosure Action

In Pennsylvania, the Erie News-Times reports:

• Erie resident Eloise Woodsbey, a disabled single mother of three, claimed she was the victim of mortgage fraud, and she sued an international financial giant to try to save her East Ninth Street house from foreclosure. The giant has blinked. Woodsbey and the German-based Deutsche Bank have reached a tentative deal that is expected to prevent the bank from foreclosing on Woodsbey's property, where she still lives. In return, Woodsbey's lawyer is expected to drop an appeal that had the potential to tie up Deutsche Bank in federal court for years as the two sides debated issues that are central to the nation's subprime mortgage crisis. Woodsbey's suit also coincided with the FBI's investigation of allegations of widespread mortgage fraud in the city of Erie -- a probe that has resulted in charges against two Erie developers.

***

• Based on prior court filings, [...], Woodsbey's lawyer, Margaret Schuetz, of the nonprofit Community Justice Project in Pittsburgh, had sued Deutsche Bank and others to try to save Woodsbey's house from foreclosure and to make sure she got money to make repairs. [...] The FBI has included Woodsbey's house on a list of 197 properties under review in its local mortgage-fraud probe.

For more, see Fraud suit nears end (Tentative deal with Deutsche Bank likely to stop foreclosure against eastside woman).

Go here for other posts related to the Erie, Pa. FBI mortgage fraud investigation. Robert Dodsworth Pennsylvania

Southern California Foreclosure Consultant At It Again

In Southern California, Fox11 TV reported last week:

• Foreclosures are sky rocketing in Southern California and as more people lose everything, unscrupulous consultants are taking advantage of the situation. Fox 11's Gina Silva has the story of [local foreclosure consultant Raul Altimarano,] who's accused of destroying the lives of several families.

For more, see Fox 11 Investigates: Investment Scam.

Raul Altimarano was also featured on this 11-26-2007 KCBS-TV Channel 2 video report, in which he was caught on camera offering foreclosure rescue services.

Florida's "Fresh Start" Foreclosure Rescue Operator Targeted By North Carolina AG

In Raleigh, North Carolina, WWAY-TV Channel 3 reports:

• A consumer alert tonight for homeowners heading toward foreclosure. The state Attorney General's office has a warning. The warning comes after a company in Florida offered foreclosure assistance to some North Carolina residents, but did little or nothing to help them. Melvin Powell of Ogden is one of five people in North Carolina who lost money to a company called Fresh Start. Powell has lived in his home for seven years. He says last March he was close to foreclosure when he got a flyer came in the mail from a company offering help. Powell signed up for the program and paid $1,200, then never heard from Fresh Start again.

***

• [Last week], a judge in Wake County ordered Fresh Start to stop offering foreclosure assistance to homeowners in our state. He also ordered the company to turn over its records on all North Carolina customers. State Attorney General Roy Cooper is also trying to help people like Powell get their money back. He's asked the judge in the case to order fresh start to either pay back their customers, or make sure the money they paid goes toward their mortgage.

For more, see Attorney General warns of foreclosure scam.

Saee also North Carolina AG's news release: Cooper stops foreclosure rip off (Fresh Start promised homeowners it could stop foreclosure but failed to deliver).

Go here for other posts on Florida-based Mortgage Assistance Solutions and their "Fresh Start" program.

Mortgage Loan Servicer Faces Class Action; Accused Of Clipping Homeowners With Dubious Fees

In Minneapolis, Minnesota, the Pioneer Press reports:

• A group of homeowners is suing Homecomings Financial, a Bloomington-based loan servicer handling nearly 800,000 mortgages, accusing it of charging dubious fees as it processes homeowners' monthly payments. The lawsuit, filed Thursday in U.S. District Court in Minneapolis, is the latest in a slew of legal actions around the country against mortgage lenders and the servicers who process payments for them since the crash of the subprime mortgage industry. Attorneys are seeking national class status. The plaintiffs are five homeowners in Michigan, Illinois, California, Kentucky and Florida. They allege that Homecomings uses deceptive fees to deliberately put borrowers into default in order to maximize profits. The charges violate state and federal laws, they charge, including the Fair Debt Collection Practices Act and the Truth in Lending Act. [...] Their attorney, Doug Micko at Sprenger & Lange in Minneapolis, said he doesn't yet know how large the class might be or how many borrowers might be in Minnesota.

***

• The company last month lost a somewhat similar lawsuit in Missouri over fees. A jury awarded homeowners $99 million in punitive damages - $92 million from Homecomings. The company said it planned to appeal. Homecomings is part of Residential Capital Corp., also in Bloomington and the mortgage arm of GMAC Financial Services in Detroit.

For more, see Loan servicer Homecomings sued over fees (Firm services 800K mortgages).

See also, Class Action Lawsuit Filed Against Homecomings.

To view lawsuit, see Motley, et al v. Homecomings Financial, LLC.

Co-counsel for plaintiffs in this lawsuit is Mehri & Skalet, PLLC, in Washington, D.C.

For more information on this class action, see the Homecomings Financial Class Action website.

For the attorneys' press release about this case, see Homeowners Allege Illegal Business Practices in Servicing Home-Secured Loans.

Go here , go here , and go here for posts on questionable mortgage servicing practices. questionable mortgage servicing practices tactics xero

Foreclosed Ohio Homeowner Files Class Action Against Deutsche Bank; Suit Based On "Lack Of Legal Standing"

In Cleveland, Ohio, WKYC-TV Channel 3 reports:

• The Cleveland law firm of Novak, Robenalt, and Pavlik has filed a class action lawsuit on behalf of local homeowners who lost their homes to foreclosure by Deutsche Bank. "Most of the homeowners had never even heard of Deutsche Bank," said attorney Thomas Robenalt. "There was a rush to file, to sell these mortgages because they were selling them at a profit." Two Cleveland federal judges have dismissed all pending Deutsche Bank foreclosures, and Robenalt's firm has filed a class-action lawsuit. The suit contends the bank began foreclosure action before it had legal standing to do so. Robenalt believes homeowners foreclosed upon by Deutsche Bank may be entitled to recovery of substantial [fees] and damages, and in some cases, where the bank re-purchased the homes at sheriff's sales, could actually recover their homes. "That is the potential upside of this," he said.

• The law firm, which is also working with the firm of Cohen, Rosenthal, and Kramer, would be interested in hearing from those whose homes have been foreclosed by Deutsche Bank.

Source: Foreclosed homeowners could get their houses back.

For more extensive report, watch the WKYC-TV Channel 3 video, which also reports that Wells Fargo, which has reportedly foreclosed on almost 5,000 Cleveland-area homeowners, may be the next class action target.

For other posts that reference the failure of some mortgage lenders and their attorneys to file the required loan documents when starting foreclosures, Go Here, Go Here, Go Here and Go Here. missing mortgage foreclosure docs alpha

Ohio AG Turned Away Again In Foreclosure Action "Real Party In Interest" Claim

In Hamilton County, Ohio The Cincinnati Enquirer reports:

• Ohio Attorney General Marc Dann has lost a second attempt to dismiss a foreclosure lawsuit in Hamilton County, with a Common Pleas Court magistrate ruling that a lender doesn't have to prove it owns the mortgage when it first seeks to take back the property. The decision Thursday in Residential Funding v. Anthony Muhammad, involving a vacant West End rental property, followed similar lines of reasoning as a ruling earlier in the week. Magistrate Michael L. Bachman said that because the state has an interest in the property - a lien for unpaid state income taxes for $1,264 - the attorney general has a conflict of interest. The attorney general's office said it would dispute the rulings to a common pleas judge.

Source: State's attempt to stop foreclosure rejected.

For other posts that reference the failure of some mortgage lenders and their attorneys to file the required loan documents when starting foreclosures, Go Here, Go Here, Go Here and Go Here. missing mortgage foreclosure docs alpha

Idaho Lawmakers Introduce Bill To Regulate Foreclosure Rescue Transactions

In Boise, Idaho, KBCI-TV Channel 2 reports:

• The Senate Commerce and Human Resources Committee printed a bill Friday that will increase protections for citizens going through foreclosure. The bill was introduced by Boise lawmakers Sen. Elliot Werk, Rep. Bill Killen, and Rep. Phylis King. The bill addresses the exponential increase in foreclosures statewide and the increased risk that Idahoans will be victimized by bail-out scams. The legislation will require contact information for assistance and a warning about scams when foreclosure notices are served, written contracts from foreclosure rescue service providers, and the ability to opt out of a foreclosure rescue contract within 5 days of signing.

For more, see Idaho lawmakers tackle foreclosure rescue scams.

To view the proposed law, see Idaho Senate Bill 1392.

Alleged Oregon "Rent-To-Own" Scam Artist Flees To Mexico, Leaving Tenants, Straw Buyers Holding The Bag

In Portland, Oregon, KATU-TV Channel 2 reports on alleged "Rent-To-Own" scam artist Jeremy Richardson, 31, of Mount Hood, who reportedly marketed a "Lease to Purchase Option" program which matched up straw buyers who purchased and leased homes and unqualified prospective homebuyers to lease the homes from the straw buyers with a purported right to buy the homes in the future. According to the story, Richardson allegedly collected and pocketed upfont money from the tenant buyers, and also pocketed rents from the tenants without applying the funds to the straw buyers' mortgages as agreed. An excerpt from the story:

• At least 10 investors quickly bought multiple properties under Richardson's direction. Some purchased three, four, five or even nine homes within a very short period of time. Now they believe it was part of a scheme that would prevent lenders from electronically tracking how many properties each investor really owned or was in the process of purchasing.

Former employees and investigators have reportedly told KATU-TV Channel 2 that there are victims in at least 15 states stretching from Alaska to the East coast.

For more, see Just how shady was Jeremy Richardson?

Go here to watch the more extensive KATU-TV Channel 2 video report.

For complaints against Jeremy Richardson on the Ripoff Report, go here , and go here.

Chicago Feds Indict 25 In Alleged Mortgage Fraud Involving 150+ Properties, Potential Losses Of $25M+

In Chicago, Illinois, WMAQ-TV Channel 5 reports:

• Twenty-five people have been charged in one of the biggest mortgage fraud schemes ever prosecuted in the area, the FBI announced Friday. The suspects charged were named in three separate indictments returned Thursday by a federal grand jury in Chicago, according to an FBI release. The charges include mail fraud, wire fraud, money laundering and conspiracy, all of which are felonies. The investigation, dubbed "Operation Marvelous" was initiated in 2004 as a joint effort between the FBI's Safe Streets Gang Task Force and the Postal Inspection Service's Mail Fraud Team after the arrest of 47 known and suspected members of a Chicago-based street gang, according to the release.

• The three indictments allege that more than 150 properties, half of which are in foreclosure, were involved in fraudulent transactions, with potentials losses from fraudulent mortgages in excess of $25 million.

For more, see FBI: Dozens Indicted In Mortgage Fraud Scheme ('Operation Marvelous' Brings Fraud, Conspiracy Charges).

NYC Realty Agent, Loan Officer Facing Charges Of Swiping, Using Former Client's I.D. To Obtain $589K Mortgage

From the office of the Queens District Attorney:

• Queens District Attorney Richard A. Brown [last week] announced that two Queens women, a realtor and a loan officer, have been charged with stealing the personal identity of a former client to purchase a Brooklyn property. It is alleged that they initially tried to get her to participate in the scheme, then used her identity after she refused. [...] District Attorney Brown identified the defendants as Elba A. Garcia, 50, of [...] Elmhurst, and Yanet Salazar a.k.a. Janet Salazar, 35, of [...] Queens Village.

• The District Attorney said that the investigation began in August 2007 when Queens resident Aurora Solano received notice in the mail indicating that a mortgage for $589,000 had been issued in her name and that a monthly payment of over $5,000 was due on September 1, 2007. Solano, who did not apply for a mortgage or authorize anyone to use her personal identification, reported the incident to the police. District Attorney Brown said that, according to the charges, Solano provided her personal identification information to defendants Garcia and Salazar, a realtor and loan officer, respectively, in early 2007 for a loan application for a property in Queens. The deal subsequently fell through and the sale did not go forward.

***

• Both women are charged with first-degree identity theft and third-degree unlawful possession of personal identific ation information. If convicted, each defendant faces up to seven years in prison.

For more, see the Queens DA press release: Realtor And Loan Officer Charged In Identity Theft Scheme (Allegedly Stole Identity of Former Client To Purchase $589,000 Property). identity theft

Retired NYC Cop With Dementia Has Home Sold Out From Under Him; One Suspect In Custody, Another May Have Fled The Country

In New York City, The Queens Courier reports:

• Two brothers are charged with fraudulently selling the Cambria Heights home out from under a retired New York City correction officer suffering from dementia. The victim’s daughter — a cop — discovered the crime. One of the brothers is in custody and the other is presently being sought internationally. Moses Brach, 30, [...] is currently in custody. His brother, Joel Brach, 27, [...] is believed to have fled to Israel. Moses [...] was arraigned [...] on a four-count indictment charging him and his brother with second- and third-degree grand larceny and second- and third-degree criminal possession of stolen property.

***

As a result of the sale of the home, a check representing the equity proceeds of $217,000 was deposited into a Wachovia Bank joint account held by the Brachs and the alleged victim. Due to the suspicious nature of the deposit, a Wachovia employee tipped off the alleged elderly victim and his family, at which point the Queens District Attorney was notified and requested that the account’s assets be frozen. The retired cop's home is now facing foreclosure.

At about the same time, the alleged victim's daughter, also a cop, discovered that her father's home was no longer in his name and had been sold to the brothers.

For more, see Brothers bilked elderly Cambria Heights man (Sold home out from under him).

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

Go here and go here for other posts on deed theft by forgery, swindle, etc. deed theft yahtzee whale

Disbarred Attorney Sentenced For Bilking $678K+ From Clients In Real Estate Deals

In New York City, the Staten Island Advance reports:

• A disbarred lawyer from Tottenville not only is disgraced, he's on his way to prison. Dennis Vourderis was sentenced [last week] to three and two-thirds to 11 years behind bars for bilking eight clients of more than $678,000 in real-estate transactions. [...] The sentence concludes the tawdry saga of an attorney with a decade-long history of scamming clients, at least one of whom has lost his home. Vourderis pocketed the victims checks and failed to make appropriate payments to lenders. Harrison Jacksons West Brighton home was foreclosed after Vourderis helped himself to Jacksons $190,000 home-refinance loan. Prosecutors charge he schemed to defraud at least 10 clients between December 2004 and May 2006. While Vourderis admitted to fleecing eight victims, prosecutors believe he ripped off about 25 people, all told, of nearly $2 million.

For more, see Staten Island lawyer sentenced in real estate scam.

The Near-Destruction Of Atlanta's Historic West End

In Atlanta, Georgia, WXIA-TV Channel 11's Jaye Watson blogs about Atlanta's Historic West End, an area named the top zip code for mortgage fraud in the nation, and its near-destruction as a result of the abandoned homes resulting from questionable real estate deals. An excerpt from the blog:

• The impact was profound. Along nine blocks of Lucile Avenue, there are 64 houses that are foreclosed from mortgage fraud. From [neighborhood resident Mark] Malaguerra's front porch, he can see almost a dozen houses that sit vacant, victims of fraud.

For more, see A Visit to Fraud's Zip Code.

Dorchester's "Urban Ghost Town" Ground Zero For Boston's Foreclosure Blight

The Boston Globe reports:

• Shock waves from the mortgage foreclosure crisis rocking the global economy are sending tremors through a depressed section of Dorchester that has been turned into a blighted urban ghost town as a result of foreclosures, shady real estate deals and abandonment. The epicenter is Hendry Street on Meeting House Hill, where a shot at urban renewal in an area historically ravaged by drugs and crime was dashed by a spate of foreclosures that left seven homes boarded up or empty. Those shuttered triple-deckers, including two condemned last year by the city, face the corners of Coleman and Clarkson streets, where six more properties stand boarded up due to abandonment or foreclosure. [...] Overall, 33 percent of the city’s 703 foreclosures hit Dorchester last year. Roxbury has the second-highest concentration with 18 percent of the foreclosures in 2007, city records show.

For more, see Foreclosure ground zero (Dorchester’s Hendry Street center of Hub’s mortgage crisis).

Vacant Mansion Gradually Being Stripped Away By Thieves; Reflects County-Wide Problem In One California Locality; DA's Office Left Holding The Bag

In Stockton, California, the Stockton Record reports:

• Thieves have been systematically stripping fixtures from one of the largest homes in the county since the residents left and security guards were pulled by its county landlords several months ago. The sprawling, Mexican-style home - between 7,300 to 8,700 square feet, based on building permits - sits on almost five acres at a rural crossroads in the eastern section of San Joaquin County. It includes a large, custom-designed indoor pool filled with murky green water, three kitchens and seven bathrooms.

***

• While the property is fenced, one of the front gates is open wide enough for a truck to drive through. [...] Besides the missing [French] doors, thieves have stripped the house of light fixtures, faucets, carpets, window coverings, toilets, anything copper - including pipes, tubing and the main electrical panel - and chiseling lots of grout to remove bathtubs and, of course, the three kitchen sinks.

***

• "Stealing [from vacant houses] is becoming way more common. We've got five properties in that area alone that we're dealing with now," said [Alan] Biedermann, the county's lead senior registered environmental health specialist. About every six months, he takes demolition contractors on a tour of abandoned homes so they can bid on deconstructing the property. Typically, five to 10 contractors are interested in the work. On last summer's tour, they visited 17 homes. Last week on his most recent tour - called a bid walk - Biedermann led 30 contractors through 32 homes slated for the wrecking ball. "It's going to probably get worse before it gets better," he said.

The abandoned mansion was formerly owned by a now-convicted felon husband and wife who reportedly signed away title to the home to the San Joaquin County District Attorney's Office as part of their court-ordered restitution in their criminal case. The DA's office, however, has not been able to unload it because of a large mortgage on the home and has reportedly given up on its efforts to dump it. They have contacted the lender, Washington Mutual, and "[t]old them they can go ahead and initiate foreclosure proceedings." WaMu has yet to act and declined to comment for the story (no word on how long WaMu has been stiffed on the mortgage payments).

For more, see Thieves taking advantage of abandoned rural homes.

Editor's Note:

It sounds like the San Joaquin County District Attorney's Office fumbled the ball on this one. They're stuck with a home that they can't sell, don't want to maintain, and are presumably "upside down" on. If I'm WaMu, I'm thinking of suing the DA's office and the county for allowing for the dilapidation of the home during their "stewardship."

Scam Artist Gets 20 Years For Pocketing $1M In Deposits In Fake Home Sales

In Polk County, Florida, The Lakeland Ledger reports:

• A Lakeland man and his wife have been convicted of organized fraud and conspiracy to commit racketeering in a real estate scam that defrauded victims out of more than $1 million, the state Attorney General's Office has announced. Thomas Salvati, 49, was sentenced to 20 years in prison and Dawn Salvati, 39, was sentenced to three years.

• While in Florida prison serving a previous sentence for organized fraud, Thomas Salvati worked through his wife to form a corporation called Inves4us through which the couple offered pre-foreclosure properties they did not own. They created fake purchase contracts for their victims to sign and then collected deposits totaling more than $1 million from potential buyers, according to a news release from the Attorney General's Office.

For more, see:

• Couple Sentenced in Property Fraud Scheme (Thomas and Dawn Salvati took more than $1 million in fake housing deals),
• Florida Attorney General News Release: Real Estate Scam Artist and Wife Receive Prison Sentences (Couple convicted of $1 million real estate scam that victimized numerous individuals throughout the state).

Tenants From Hell Turn Themselves In After Abandoning 50 Pets In Rented Duplex; Accused Of Serially Trashing At Least 3 Rented Homes In One Year

In Broward County, Florida, WTVJ-TV Channel 6 reports:

• Police arrest two women after dozens of dogs were found abandoned and living in filth and a rental home was discovered ruined with animal feces. Detectives called 44-year-old Ann Centofanti and her daughter 24-year-old Ann Hesse-Centofanti serial home destroyers. On Sunday, police found 46 dogs and three cats abandoned and living in filth inside a home in Oakland Park. Cleanup crews found another dog hiding in a closet on Tuesday. The Centofantis were arrested on Tuesday as they had just moved into a home in Fort Lauderdale. Detectives said they were on their way to trashing that home, too.

The Miami Herald reported that, in the last 12 months, these tenants "went through at least three other homes, two of which needed to be completely gutted, and their pooch collection topped out at 63 before they called it quits, according to neighbors, landlords and the Broward Sheriff's Office." In their most recent rental trashing, the home "was so filled with waste deputies needed to wear hazmat suits to enter, BSO said." For more, see:

• WTVJ-TV Channel 6: 2 Women Arrested After Nearly 50 Animals Found Living In Filth,
• The Miami Herald: Dog-filth suspects were investigated last year (The women accused of serially trashing rental homes by packing them with unsupervised pets received a visit from BSO and DCF after neighbors complained of smelling dog feces last year).

Go here for a slideshow pictorial sampling of the type of handiwork the tenants from hell were capable of (courtesy of WPLG-TV Channel 10 and the Broward Sheriff's Office).

Financially Strapped PTO President Charged With Pocketing Group's Cash To Catch Up On House Payments

In Mars, Pennsylvania, the Pittsburgh Tribune Review reports:

• The president of the Mars Elementary School Parent-Teacher Organization will have a preliminary hearing March 5 on charges she took $3,000 from the group to make back payments on her mortgage. Paula McDade, 40, of Lowery Drive, Valencia, faces five counts in the case, including theft, receiving stolen property, fraud, tampering with records and misusing entrusted property.

For more, see Mars PTO president charged with theft.

"One-Pot Method" Blamed For Increase In Home-Based Meth Labs, Say SW Michigan Cops

In Kalamazoo, Michigan, The Grand Rapids Press reports:

• Police found components of a "one-pot" methamphetamine lab Monday in the basement of a home in the city's Vine neighborhood, authorities said. Police in southwestern Michigan have said meth-lab busts, which have been on the decline since 2005, are spiking again in the region thanks to the one-pot method, a quick new recipe that allows meth manufacturers to make the drug in as little as a half hour using pseudoephedrine, discount-store ingredients and a couple of pop bottles.

For more, see Kalamazoo meth lab busted.

Go here for some methamphetamine information resources.

Go here and go here for other posts on home based meth labs. meth lab zeta

Grand Rapids Fire Displaces 101 Households, Leaving Many Financially Squeezed, Homeless

In Michigan, the Grand Rapids Press reports:

• Like many others who lost everything to a spectacular fire two weeks ago, Betsey Chase went to a housing fair [recenty] to get help toward rebuilding her life. She quickly learned it will not be easy. Yes, keep making mortgage and association payments on the two-bedroom condominium you lost, she was told. And no, insurance payments probably would not come in time to help cover the initial rent for government-subsidized senior housing -- that's assuming her application is approved. "I feel like I'm being pulled in so many directions," said the 87-year-old Chase, holding her head in her hands and fighting back tears. [...] The Jan. 20 fire [...] displaced 101 households.

***

• [Extension office community development specialist Carol] Townsend said while some, such as Chase, were lucky to have relatives take them in, others have relied on the Red Cross for temporary housing. But the rescue organization's resources have been stretched by the needs of the 70 to 85 cases opened in the wake of the fire, she said.

For more, see Condo fire victims get advice at housing fair.

Home In Foreclosure Suffers $25K In Fire Damages; Blaze Not Considered Suspicious

In Brookfield, Wisconsin, the Milwaukee Journal Sentinel reports:

• Fire caused about $25,000 in damage Sunday night to a home owned by Town Supervisor Robert Flessas, a residence on which he is facing a foreclosure action and has said he wants to turn into a bed and breakfast. Fire Chief Andy Smerz said Monday that the fire was a routine chimney fire that originated in the flue and spread to the walls nearby on the second floor and was not considered suspicious. The fire caused smoke damage throughout the home [...] he said.

For more, see Fire damages supervisor's home (House facing foreclosure suffers $25,000 in damage).

For other stories on fires & foreclosures, go here , go here , and go here. foreclosure arson xerox

Blaze Hits Vacant Home In Foreclosure; Declared "A Total Loss"

In Aurora, Colorado, the Rocky Mountain News reports:

• Aurora firefighters put out an intense house fire [Monday] morning near East Jewell Avenue and Interstate 225, but the structure was declared a total loss. [...] The house was vacant and had been on the market for six months, [Capt. Mark Turley of the Aurora Fire Department] said. According to real estate listings, it had been in foreclosure and was on the market for $160,000. The notice said the four-bedroom, three-bath house needed "major cosmetic work."

***

• "We did an initial attack, went in and with our crews inside," Turley said. "But within a few minutes of being on the scene, the whole roof was getting ready to collapse and that's a real problem for us. So we did an emergency evacuation." A portion of the roof soon collapsed into the structure. Firefighters then concentrated on preventing the flames from spreading to a nearby evergreen tree, where they feared it might then spread to an adjacent house. Turley said no one was hurt in the effort. Investigators stayed on the scene to begin sifting for clues to the cause of the fire.

For more, see Intense blaze destroys Aurora home.

For other stories on fires & foreclosures, go here , go here , and go here. foreclosure arson xerox

Industry Analysts Divided On Any Link Between Increasing Foreclosures & Arson

A recent story in MSN Moneycentral explores the possibility of a link between the increase in home foreclosures and the increase in arson.

• [A]cross the U.S., homeowners are searching for ways to escape from mortgages they can't pay -- or don't want to. A few are turning to arson, but it's too soon to turn anecdotes into meaningful statistics. Consumer pressure and state laws require speedy settlements, which means insurance companies are quick to pay up and slower to complete complex arson investigations. Definitive answers will come later.

For more, see Broke homeowners linked to arsons (Authorities in economically stressed cities see an increase in torched houses. Is the nation's mortgage mess transforming more Americans into criminals?)

For other stories on fires & foreclosures, go here , go here , and go here. foreclosure arson xerox

Foreclosure Crisis Report Released

From the Ohio Attorney General's Office:

• Ohio Attorney General Marc Dann, along with 10 state attorneys general and several state banking regulators, released a report [yesterday] revealing major shortcomings in the response of subprime mortgage loan servicers* to the foreclosure crisis. “Across the country, hundreds of thousands of people are losing their homes to foreclosure,” said Attorney General Dann. “Yet we’ve found that servicers’ efforts to help at-risk borrowers fall seriously short of need.”

• The group, the State Foreclosure Prevention Working Group, met last summer to work with servicers of subprime mortgage loans to identify ways to work together to prevent unnecessary foreclosures; situations where it is in the financial interests of both the secondary market investors and the borrower to modify the loan.

For some of the key findings in the report, see the Ohio AG's press release: Foreclosure Crisis Report Released (Major shortcomings in efforts by servicers to stop foreclosure crisis).

For the actual report, see Analysis Of Subprime Mortgage Servicing Performance.

Goring Gets 10 Years In Straw Buyer, Flipping Operation

In Pueblo, Colorado, The Pueblo Chieftain reports:

• A budding real estate mogul whose operation grew beyond his grasp and deteriorated into shady appraisals, forged documents and fraudulent collection of loan proceeds was sentenced Wednesday to 10 years in prison. In October, District Judge Rosalie Vigna found Maurice Goring, 41, guilty of two counts of racketeering under the Colorado Organized Crime Control Act.

***

• Goring enlisted acquaintances he met at church to serve as the listed owners on distressed properties he purchased. Goring then pocketed the mortgage loan proceeds, often taking out a second mortgage immediately at closing. He let the houses lapse into foreclosure. Along the way, he ruined the credit of the people who agreed to serve as the registered owners of the homes.

For more, see Man gets 10 years in real-estate scam.

Go here for earlier posts on Maurice Goring's straw buyer, flipping operation.

Twin Cities Alleged Mortgage Fraud Ring Growing "Like A Fungus"

In Minnesota, the Pioneer Press reports:

• It all started in 2006 when a Plymouth man called police after finding a mortgage notice in his mailbox, addressed to him, for a house he'd never heard of. Three arrests later, investigators now are sifting through the paperwork on some 80 closings done at title companies in Shoreview and Burnsville in an alleged mortgage-fraud ring that they say just keeps growing. "Everywhere you turn, it's like a fungus," said Detective Cory Cardenas of the Bloomington police.

• The investigation originally centered on 53-year-old Larry D. Maxwell of Minneapolis, according to a search warrant affidavit filed last week in Ramsey County District Court. In November, Maxwell was arrested and charged in Hennepin County District Court with 10 counts, including racketeering, theft by swindle, identity theft and aggravated forgery related to real estate deals made in 2006. He was released after posting bail of $250,000 and a pretrial hearing is being scheduled. The new search warrant indicates the case has broadened, and describes a long list of records detectives wanted to collect from two title companies in Shoreview and Burnsville where two associates of Maxwell handled closings.

For more, see Mortgage-fraud probe grows (Arrests, search warrants related to millions in real estate deals).

NC Man Cops Conspiracy Plea In Alleged Ponzi Scheme-Like Fraud Costing Investors $100M+

In Charlotte, North Carolina, The News & Observer reports:

• The former president of a company involved in a failed real estate project that cost investors more than $100 million pleaded guilty [yesterday] to one count of conspiracy in U.S. District Court in Charlotte. Neil O'Rourke, 40, of Apex, held various positions at companies involved in the mountain development known as the Village of Penland, located about an hour northeast of Asheville. He became president of Peerless Real Estate Services in in 2004. O'Rourke pleaded guilty to a conspiracy charge that included making a false application and statements in relation to loans, mail fraud, wire fraud, bank fraud and securities fraud. O'Rourke appeared today in Charlotte to formally enter a guilty plea.

***

• According to the statement [issued by the Feds], O'Rourke participated in a conspiracy of investment and mortgage fraud: "The investment fraud scheme was carried out in a Ponzi scheme fashion, where new investor funds in the Village of Penland were diverted to make mortgage payments for other investors."

For more, see Apex man pleads guilty in real estate fraud case (no longer available online).

Go here for other posts on the alleged scheme underlying the failed North Carolina Village of Penland project. Tony Porter

Brand New 164 Unit Madison Condo Tower Faces Foreclosure

In Madison, Wisconsin, the Wisconsin State Journal reports:

• The second phase of Downtown Madison 's largest private housing project is in default to the tune of more than $26 million, its lenders said in court documents that seek foreclosure of its three mortgages. The fate of the newly completed Metropolitan Place II, a 164-unit condominium tower facing West Mifflin Street, could indicate that national housing trends are reaching Madison, thought by some to be more immune than most places to twists and turns in U.S. economy. [...] According to city property records, only 61 of the building 's 164 units -- about 37 percent -- have been sold.

Reportedly, Metropolitan Place II developer Cliff Fisher and his company, Buckingham LLC, currently has two other major apartment projects before the city of Madison for consideration. For more, see 2 banks seek foreclosure on Metropolitan Place II.

For story update, see Metro Place II may soon get back on track. (3-7-2008)

Ohio AG Sues Home Repair Outfits Alleging Incomplete, Shoddy Work; Elderly, Poor Among Those Targeted With Deceptive Practices, Say Suits

In Franklin County, Ohio, The Columbus Dispatch reports:

• Three central Ohio home-improvement companies were sued yesterday by the Ohio attorney general's office, which accused them of taking customers' money but not doing the work they promised. Appleby Painting of Hilliard, Ohio Homeowner's Rehab of Worthington and the Concrete Crew Co. of Gahanna were accused of taking payments for uncompleted improvements and of doing "shoddy work" on projects they did complete, according to a series of lawsuits filed by Attorney General Marc Dann. The suits, filed in Franklin County Common Pleas Court, also said the companies routinely didn't honor warranties and "targeted low-income and elderly consumers with deceptive practices."

***

• "Consumers were misled into believing that they would be eligible for government grants to fund their projects," he said. That caused "them to take out mortgage loans to pay for work that was never performed."

For more, see 3 local companies bilked homeowners, state says.

For the Ohio AG's Press Release, see Attorney General Dann Seeks to Stop Home Improvement Fraud (Alleges multiple violations of consumer protection laws).

To view the lawsuits, alleging violations of the Consumer Sales Practices Act, the Home Sales Solicitation Act , and the Magnuson Moss Warranty Act, see:

• State of Ohio v. Ohio Homeowner’s Rehab LLC,
• State of Ohio v. The Concrete Crew,
• State of Ohio v. Appleby Painting, Inc. Troy Appleby, OHR, OHC, LLC , The Concrete Crew Company of Gahanna, Dennis Ranke, Jr, The Columbus Construction Crew, LLC

City Demolishes Resident's Home Without Giving Proper Notice, Says Suit

In Port Arthur, Texas, The Southeast Texas Record reports:

• Port Arthur resident Herman Anderson Jr. has filed a lawsuit against the city, claiming city officials had his home demolished without giving him proper notice. [...] Although a demolition permit was issued on June 26, 2007, Anderson says did not receive a 104 Letter notifying him that a demolition permit had been issued. The suit states his home was demolished on June 26, the same day the permit was issued. Anderson claims he had visited city hall three times prior to the demolition, and that several city officials mislead him about when his home would be demolished.

For more, see PA homeowner says house demolished without notification.

Boston To Consider Ordinance Requiring Registration Of Foreclosed Homes To Control Blight

In Boston, Massachusetts, WCVB-TV Channel 5 reports:

• You see them popping up throughout the city -- vacant homes in foreclosure, falling into disrepair. The city of Boston has decided to turn up the heat on mortgage companies in an effort to get them to clean up their act. [...] To that end, Boston City Councilor Rob Consalvo will introduce an ordinance that would require companies to register foreclosed properties with the city, identify who's responsible for maintaining the home, post contact information on the property and pay an annual fee of $100 for each vacant home. [...] When lenders don't do their part, the cost of maintaining abandoned homes often falls to the city. The vacant homes also can sometimes drag down the value of neighboring properties. Similar ordinances have already been passed in other cities.

For more, see Boston May Crack Down On Owners Of Foreclosed Properties (Proposed Ordinance Would Require Lenders To Maintain Vacancies).

Legal Services Group Leads Foreclosure Fight In Florida

In Duval County, Florida, the Jacksonville Daily Record ran a story which, in part, describes some of the work of the non-profit law firm Jacksonville Area Legal Aid ("JALA") in fighting foreclosures:

• [J]ALA is one of the more successful legal service organizations when it comes to fighting home foreclosures — with a 100 percent success rate, said [executive director of JALA Michael] Figgins. But at the same time, JALA is forced to turn away 75 percent of qualified homeowners who are facing foreclosure because it doesn’t have enough people on staff to help everyone. Figgins said his staff has saved 300 homes. Currently, there are three people on staff that are dedicated to foreclosures and one dedicated to bankruptcy law. “There is great success to be made,” said April Charney, an attorney at JALA who has been on the front lines when it comes to fighting against foreclosures.

For more, see Sink outlines foreclosure crisis in Jacksonville.

Reptiles, Horses, Potbellied Pigs, Exotic Cats Not Immune To Foreclosures

In Hesperia, California, the Victorville Daily Press reports:

• More than 200 reptiles worth an estimated $90,000 were found abandoned in a freezing, filthy room attached to a garage in Hesperia. Most were alive, though weak. Some had died from the cold or dehydration, including two gila monsters. “This is absolutely the biggest reptile rescue I’ve ever done by far,” said Joel Almquist, owner of the non-profit Forever Wild Exotic Animal Sanctuary in Phelan.

***

• Though the investigation by Hesperia Code Enforcement and Animal Control is still underway, Almquist suspects the reptiles may be the latest victims of the foreclosure epidemic sweeping across the High Desert. “I’ve been getting a lot of calls like that lately,” he said. Not long ago, a real estate agent called Almquist after finding six potbellied pigs abandoned at a foreclosed property. [...] The same thing happened with six sickly thoroughbred horses that a man brought by a few months back. [...] Almquist has also gotten calls from Norco Animal Control asking him to take an African Serval Cat, and Fish and Game about an alligator found in a foreclosed home in Fontana.

For more, see 200 reptiles abandoned in Hesperia.

For more on foreclosures and abandoned animals, see Foreclosures & Pets I, and see Foreclosures & Pets II. petsII and foreclosures

Ohio Lawsuit Alleging Title Insurance Homeowner Ripoff Certified As Class Action

In Toledo, Ohio, the Toledo Blade reports:

• A federal judge in Toledo granted class-action status [last week] in a lawsuit that could result in refunds for tens of thousands of Ohio homeowners who may have been overcharged for title insurance. A lawyer for defendant Fidelity National Title Insurance Co., which is among the nation's largest issuers of policies to protect buyers and lenders from hidden liens and other deed problems, declined to comment on the development.

***

• In a practice that is the subject of suits nationwide, the [plaintiffs] allege that Fidelity failed to give them and other customers posted discounts on policies issued in mortgage refinancing transactions that took place within 10 years of the original home purchase. Typical discounts at Fidelity were supposed to be $100 to $250 a customer, the [plaintiffs'] lawyer said previously. If they win their case, up to 94,000 homeowners who bought policies from Fidelity since Feb. 15, 2000, could be affected.

For more, see Class action granted in Ohio case against title firm (Judge in Toledo cites interest of fairness).

Go here for other posts involving legal issues related to title insurance.

Editor's Note: Fidelity Title is reportedly part of Jacksonville, Florida-based Fidelity National Financial Inc., a Fortune 500 company which, coincidentally, is located at the same street address as Fidelity National Information Services Inc., the alleged "secret puppetmaster" of creditors' lawyers recently accused in an unrelated lawsuit of ripping off bankrupt homeowners in foreclosure (see Class Action Suit Alleges Conspiracy To Squeeze Bankrupt Homeowners In Foreclosure; Fidelity An Alleged "Secret Puppetmaster" Of Creditors' Lawyers).

I wonder if there's any connection between the two companies??? title insurance legal issues

Bank Fires Employee In Retaliation For Blowing Whistle On Mortgage Fraud, Says Lawsuit

In Broward County, Florida, The Miami Herald reports:

• A former SunTrust Bank mortgage loan coordinator contends in a lawsuit that he was fired after alerting superiors to mortgage fraud occuring at the bank. Some SunTrust loan officers fudged borrowers' incomes and approved multiple loans on investment properties that were actually reported as second homes, ensuring borrowers not only qualified for loans but got them at lower interest rates, said Alan Archambault, a five-year bank employee who was fired late last year. Archambault, 43, of Sunrise, sued SunTrust claiming his firing violated Florida's Whistle Blower Act, which bars companies from taking retaliatory action against employees for objecting to illegal conduct.

For more, see Ex-SunTrust worker challenges firing (A lawsuit accuses SunTrust Bank of firing a mortgage loan coordinator in retaliation for exposing mortgage fraud at the bank).

To view the lawsuit, filed in Broward Circuit Court, see Archambault v. Suntrust Banks Inc., et al.

Go here for other posts on whistleblower suits involving alleged fraudulent mortgage lending practices.

Another Employee Allegedly Canned For Disclosing Fraudulent Lending Practices Files Whistleblower Lawsuit

The Associated Press reports:

• A former employee of Countrywide KB Home Loans has filed a lawsuit claiming he was wrongly fired after he reported fraudulent lending practices to superiors and refused to approve mortgages for unqualified applicants. The federal lawsuit was brought by Mark Zachary, a regional vice president and manager of the Countrywide KB Home Loans division in Houston. He seeks unspecified compensatory and punitive damages against the joint venture of mortgage lender Countrywide Financial Corp. and builder KB Home.

***

• In the suit, Zachary contended he was given an excellent performance review last February then fired three months later after he blew the whistle on fellow employees and outlined instances in which appraisers were "being strongly encouraged to inflate homes' appraised value by as much as 6 percent." That resulted in buyers owing more than their home was worth, Zachary claimed in the lawsuit filed Jan. 17 in U.S. District Court in the Southern District of Texas. [...] Zachary said he was fired after he failed to meet a quota for new loan approvals because he refused to clear unqualified applicants, according to the complaint.

For more, see Fired Worker Sues KB Home, Countrywide.

Go here for other posts on whistleblower suits involving alleged fraudulent mortgage lending practices.

The Establishment, The Pigeons, & The Foreclosure Crisis

Columnist Robyn Blumner for The St. Petersburg Times recently made this observation on the subprime foreclosure mess:

• It's the perfect crime, so big and so reeking of establishment that few recognize the inherent criminality, but the results are the same as if some street thug held us all up at gunpoint. This country is spiraling toward recession. Huge amounts of wealth have disappeared with upward of 2 million families in danger of losing their homes to foreclosure, all because of the corruption of people in suits. When someone gets mugged for the few dollars in his wallet, the thief goes to prison for years. But when bankers, mortgage brokers, credit-rating agencies and investment firms conspire to scam investors and exploit the naivete of borrowers in order to enrich themselves to the tune of billions of dollars, no one goes to jail.

For the rest of her observations, see Thugs in suits shooting pigeons (column appears in the Pittsburgh Tribune Review).

For the slightly longer, original version of Robyn Blumner's column, see the St. Petersburg Times: They ought to draw a go-to-jail card (same columnist, different headline writer).

Quest To Place Blame For Foreclosure Mess Continues

The San Francisco Chronicle recently ran a story in which it identifies six prime "suspects" (groups of suspects, actually) for the serious foreclosure problem, and a description of the "allegations" against each.

The following excerpt tells you where you can find "the mortgage disaster's bad guys":

• [T]hey're everywhere in the mortgage food chain. Borrowers who lied about their income, mortgage brokers who flogged risky loans, appraisers who inflated home values, lenders that originated dicey mortgages, Wall Street firms that packaged them as securities and sold them, ratings firms that said those were safe investments - many participants in the market pushed the envelope, or, in some cases, may have committed outright fraud.

For more, see Mortgage Meltdown: Plenty Of Blame For Lending Mess (Suits filed, agents hunting perpetrators of loan scams that devastated the nation).