Welcome to The Home Equity Theft Reporter, a blog dedicated to informing the consumer public and the legal profession about Home Equity Theft issues. This blog will consist of information describing the various forms of Home Equity Theft and links to news reports & other informational sources from throughout the country about the victims of Home Equity Theft and what government authorities and others are doing about it.
Friday, April 27, 2012
Sacramento Feds Score 3 Convictions Centering On Equity Stripping Racket That Peddled Sale Leaseback Ripoffs To High-Equity Homeowners In Foreclosure
In Sacramento, California, The Record Searchlight reports:
Two Redding residents indicted by a federal grand jury in 2010 for their roles in what prosecutors have described as a fraudulent foreclosure recovery scheme pleaded guilty [] in U.S. District Court, a spokeswoman with the U.S. attorney's office said. A Redding woman also indicted in the same case has rejected a plea bargain offer and is scheduled to stand trial next month.
Lauren Horwood, a spokeswoman for the U.S. attorney's office, said Darrin Arthur Johnston, 47, and Todd Allen Smith, 49, both of Redding, as well as Jeremiah Allen Martin, 34, of San Antonio, pleaded guilty Tuesday and are scheduled to be sentenced on Sept. 25. But she said the terms of the plea bargains, as well as the specific counts to which the trio admitted guilt, won't be released until then.
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Prosecutors have said the alleged fraud scheme resulted in financially distressed homeowners signing over the deeds to their homes with the understanding that they could lease them and buy them back in two years. But, prosecutors have said, Johnston, Smith and Martin allegedly pocketed the lease-rental payments instead of paying off the loans.
Peterson, who was an escrow officer, used her notary status to give the appearance of legitimacy to the scheme, the federal indictment claims. Many homeowners lost their homes in the course of the alleged fraud, and lenders suffered losses in excess of $1 million, prosecutors have said.
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According to the federal jury's indictment, the so-called foreclosure recovery program was based on their false representations that the homeowners could lease back their homes for a low rent and that they would help them repair their credit.
After obtaining titles to the homes, however, prosecutors said, Martin, Johnston and Smith allegedly extracted equity from them by inflating their values and obtaining additional loans, keeping the rent payments rather than making payments to lenders, and then allowed the homes to be lost in foreclosure.(1)
CBC News: Betrayal of Trust (A CBC investigation reveals how lawyers across Canada have misappropriated and mishandled clients money, to the tune of tens of millions of dollars, or sometimes even charging vulnerable people top dollar for shoddy services)
Land Contract/Contract For Deed/Rent-To-Own Rackets
The New York Times: The Housing Trap (In the wake of the housing crisis, low-income families have turned to seller financing to buy homes but these deals can be a money trap)
Beware The Fine Print: Consumers Forced To Sign Away Their Rights To Use Court System
The NY Times: Arbitration Everywhere, Stacking the Deck of Justice(Part 1 in series examining how clauses buried in tens of millions of contracts have deprived Americans of one of their most fundamental constitutional rights: their day in court)
Foreclosure Mills' Abysmal Record In Complying With New NYS Foreclosure Requirements
Justice Deceived: How Large Foreclosure Firms Subvert State Regulations Protecting Homeowners
MFY Legal Services Report On Questionable Practices By Process Servers In Debt Collection Cases
Justice Disserved: A Preliminary Analysis of the Exceptionally
Low Appearance Rate by Defendants in Lawsuits Filed in the Civil Court of the City of New York
Mortgage Mess Redux: Robo-Signers Return (A Reuters investigation finds that many banks are still employing the controversial foreclosure practices that sparked a major outcry last year)
CNN Video: As Foreclosures Mount, Florida Court Turns To 'Rocket Docket'
The Wall Street Journal: A Florida Court's 'Rocket Docket' Blasts Through Foreclosure Cases (2 Questions, 15 Seconds, 45 Days to Get Out; 'What's to Talk About?' Says a Judge)
"Produce The Note" Strategy When Dealing With Missing Promissory Notes In Foreclosure Actions
ABC Video: Fighting Against Foreclosure (Some homeowners have found a new tactic to keep the banks at bay)
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