Woman Fraudulently Obtains Property Tied Up In Bankruptcy Case, Then Pockets Refinancing Proceeds, Say California Feds

From the Office of the U.S. Attorney (San Jose, California):

• Vallejo, Calif., resident Myra Holmes was indicted by a federal grand jury with concealment of assets and bank fraud, United States Attorney Joseph P. Russoniello announced.

***

• The indictment accuses Holmes of enriching herself by convincing her father – who had previously filed for Chapter 11 bankruptcy – to convey to her, without consideration and without notifying or obtaining the permission of the bankruptcy court or the bankruptcy trustee, his interest in the Vallejo property where she lived. The indictment further alleges that after Holmes obtained her father’s interest in the property she withdrew the equity from the property through a refinancing mortgage loan, which she procured with a fraudulent refinancing application. According to the indictment, as a result of her fraudulent refinancing application, Holmes received a refinanced mortgage, which increased the outstanding mortgage on the Vallejo property from approximately $180,000 to approximately $338,000; [...]. To date, Holmes has not repaid the bankruptcy estate for the funds she took out of the Vallejo property in the November 2005 refinancing.(1)

For the press release, see Vallejo Woman Charged With Mortgage And Bankruptcy Fraud (Defendant Used Fraudulent Deed to Obtain More Than $130,000 in Equity From Residence in Bankruptcy Proceeding).

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

(1) According to the indictment, Holmes legitimately owns a 50% interest in the home, with her father holding the remaining 50% interest. The indictment states that the bankruptcy trustee in her father's case had filed court papers seeking a sale of the entire property (including Holmes' 50% share, despite the fact that she herself was not under the jurisdiction of the bankruptcy court) in order to get at and apply her father's 50% share of the sale proceeds to outstanding debts owed to his creditors, leaving her with half the home sale proceeds, but forcing her out of the house. The actions she is accused of may have been an attempt to thwart the bankruptcy trustee in his/her desire to liquidate the property.