Hawaii Feds Pick Up Guilty Pleas In Equity Stripping Foreclosure Rescue Scam

In Honolulu, Hawaii, the Hawaiian Advertiser reports:

• [Rick Kealoha Pa Jr.] faces five years in prison, a $250,000 fine and payment of restitution to an evicted homeowner after pleading guilty yesterday to aiding a Honolulu mortgage company accused of orchestrating a foreclosure bailout scheme and stealing hundreds of thousands of dollars from banks and distressed homeowners.

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• Pa was paid $10,000 to submit falsified mortgage loan applications, according to court documents. When the scam fell apart, a Makakilo family was evicted from their home.
  Pa was one of several loan officers employed by John M. Dimitrion,(1) founder and chief executive of Mortgage Alliance LLC, and his wife, Julie A.B. Dimitrion, the firm's chief financial officer.(2)

For more, see Man pleads guilty to fraud (Loan officer helped firm in mortgage scam that led to family's eviction).

For the indictment, see U.S. v. Dimitrion.

(1) Dimitrion and his associates are accused of finding homeowners on the cusp of foreclosure and offering help if the homeowners agreed to a temporary sale of the house to a third-party "investor," according to court documents. They allegedly told the homeowners they could remain in their homes and that their title would be returned to them after a set period of time. But Mortgage Alliance allegedly stole the proceeds by funneling the money into fake escrow accounts, and the new loan would go into default, according to court documents.

(2) Reportedly, one of Dimitrion's former employees, Vance Yukio Inouye, 31, has already pleaded guilty and has promised to cooperate with the government; Dimitrion and his wife, Julie Ann Baldueza Dimitrion, are scheduled to plead guilty later this month; and the final defendant, Benjamin Yoshito Thompson, is scheduled to stand trial in September. See Star-Bulletin: Mortgage fraud case draws new guilty plea.