Arizona Loan Modification Scammer Gets 5 Years For Scamming 47 Struggling Homeowners Out Of Upfront Fees In Exchange For Phony Promises Of Help

From the Office of the Arizona Attorney General:

• Attorney General Terry Goddard [Friday] announced that Bobby John Herrera, 33, of Glendale, has been sentenced to five years in prison as the result of a mortgage loan assistance scam he orchestrated that victimized 47 Valley homeowners. Herrera was also ordered to pay $80,541 in restitution to victims.

• In December 2008, Herrera was arrested by Surprise and Peoria police in connection with the scheme. He pleaded guilty to one count of fraudulent schemes and artifices, a Class 2 felony, in Maricopa County Superior Court in April.(1)

• According to investigators, Herrera solicited struggling homeowners with fraudulent claims that he could modify mortgage terms or provide other assistance to help them prevent foreclosure. Herrera allegedly claimed to have "connections" and expertise negotiating with mortgage lenders to reduce consumers’ monthly payments and prevent foreclosure. In exchange for the services he claimed to provide, investigators said Herrera often charged the victims upfront fees of $1,245. Herrera is alleged to have not provided any such mortgage loan modification or foreclosure relief assistance, using the money instead for personal expenses.

For the entire press release, see Fraud Artist who Victimized 47 Homeowners Gets Five-Year Prison Term.

(1) According to the indictment, Herrera originally faced charges of:

• one count of fraudulent schemes and artifices (ie. knowingly obtaining any benefit by means of false or fraudulent pretenses, representations, promises or material omissions, pursuant to a scheme or artifice to defraud, in violation of § 13-2310 of the Arizona Revised Statutes),
• one count of money laundering (A.R.S. § 13-2317),
• one count of illegal control of an enterprise (A.R.S. § 13-2312(A)), and
• six counts of theft (A.R.S. § 13-1802(A)(1)).