Loan Mod Scammer Serving 2 To 5 Years Gets Another 6 To 24 Months On Theft By Deception Charge As "Poor Business Decisions" Defense Falls On Deaf Ears

In Wyoming County, Pennsylvania, The Times Tribune reports:

• A New Jersey woman who claimed to help people with potential foreclosure problems was sentenced in Wyoming County on Thursday for theft by deception. Shirley Matthews, 54, of Willingboro, N.J., was ordered to serve six months to two years in prison on the theft by deception conviction for bilking a Tunkhannock man out of $8,000.

• Ms. Matthews will serve that sentence after she finishes a 2- to 5-year prison term on similar charges from Monroe County, Judge Russell Shurtleff ordered.

• Also, additional charges are now pending against Ms. Matthews in Luzerne County. In all of the cases, Ms. Matthews was accused of taking payments from home­owners in exchange for helping solve mortgage foreclosure problems, then failing to follow through. [...] Her attorney, Robert Saurman, told the court Ms. Matthews may have made some poor business decisions, but it wasn't her intent to harm.(1)

For the story, see N.J. woman gets 2 to 5 years in prison for taking from people facing foreclosure.

(1) The problem that some police and prosecutors have in dealing with scams like this one that are disguised as legitimate business transactions is that it's too easy for the scammer, once "caught," to hide behind the terms of what purports to be a "legitimate" business contract. A scammer who pocketed money in exchange for performing a slew of failed loan modifications may assert that the terms of the business contract with the victims insulate him/her from criminal prosecution, and at most, may simply "confess" to being a crappy businessperson who made lousy business decisions, but without any intention of actually screwing anybody, leading some authorities to decline investigation and prosecution. It's not uncommon for authorities to claim that such incidents are "civil cases," suggesting the victim would need to file a civil lawsuit against the scammer to seek a remedy. Fortunately for the victim in this case, the police and prosecutors did not adopt that approach here and, instead, looked through the paperwork to show the true nature of the transaction.

See People v. Frankfort, (1952) 114 Cal.App.2d 680; 251 P.2d 401, for the following commentary by a California appellate court on how it dealt with a scammer who tried to hide behind the terms of a "legitimate" contract with a "customer/victim" in a failed attempt to dodge criminal prosecution (case law links are found at Findlaw.com - may require free registration):

• Defendants insist these contracts insulate them from this prosecution because they contain the statement that they constitute the entire agreement between the parties, that the Spa Corporation is not bound by any representations outside the contract, that no salesman is authorized to make any additional or contrary representations, and that the club member has read and understands what he is signing. The simple answer to this argument is that "The People prosecuting for a crime committed in relation to a contract are not parties to the contract and are not bound by it. They are at liberty in such a prosecution to show the true nature of the transaction." (People v. Chait, 69 Cal.App.2d 503, 519 [159 P.2d 445]; People v. McEntyre, 32 Cal.App.2d Supp. 752, 760 [84 P.2d 560]; People v. Jones, 61 Cal.App.2d 608, 620 [143 P.2d 726]; People v. Pierce, supra, p. 605.) The practical wisdom of the rule is illustrated in this case. Upon at least three occasions prospective purchasers complained to defendant Nudelman that the written agreement did not seem to conform to what they had been told, whereupon he assured each party, in effect, that everything would be taken care of and he need not worry.

See also:

People v. Pierce, (1952) 110 Cal.App.2d 598, 243 P.2d 585):

• The determination of the intention is not limited to a construction of the writing. This is particularly true in the criminal field since the prosecution is not bound by any such contract. (People v. Sidwell, 27 Cal.2d 121, 126 [162 P.2d 913]; People v. Robinson, supra, p. 221; People v. Martin, 102 Cal. 558, 566 [36 P. 952].)

People v. Sidwell, (1945) 27 Cal.2d 121, 162 P.2d 913, in which the California Supreme Court made this observation:

• And in this criminal prosecution the state is not bound by the written provisions of the civil contract between the defendants and Moore. (People v. Martin (1894), 102 Cal. 558, 566 [36 P. 952]; People v. Eiseman (1926), 78 Cal.App. 223, 241 [248 P. 716]; People v. Kelley (1927), 81 Cal.App. 398, 403 [253 P. 773]; People v. Robinson (1930), 107 Cal.App. 211, 221 [290 P. 470].