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.
Sunday, June 10, 2012
Loan Mod Fraud, Use Of Forged 'Conditional Approval' Letters In Phony Refi Offers Among Accusations That Bag Five; One Cops Plea, Gets Year In Jail
In Orange County, California, the Orange County Register reports:
Andrew Michael Phalen was sentenced [] to a year in jail and five years of formal probation [] for his role in a scam that offered home loan modification assistance to struggling mortgage holders across the country.
But four of the Mission Viejo 25-year-old's cohorts are looking at much more serious prison time for the scheme that relied on letters forged with CitiFinancial or CitiMortgage logos. Phalen's co-defendants are: Jacob John Cunningham, 25, of Irvine; Justin Dennis Koelle, 22, of Costa Mesa; Dominic Adam Nolan, 31, of Irvine; and John D. Silva, 27, of Irvine.
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All five allegedly sent promotional letters to people throughout the U.S. with offers to restructure their home loans, with references to the individual homeowner's specific lender and principal balance. Those who signed on were charged upfront fees for loan modification services, despite California having outlawed such charges on Oct. 11, 2009.
Those who called a number on the letter were told they could get a complete refund of the fee if their loan was not modified, something that was unlikely, or so it seemed, because the company boasted a 95 to 100 percent success rate.
But Phalen pleaded guilty to, and the others are accused of, taking the money people paid without securing loan modifications, and of failing to return or refund the fees.To hide the thefts, company names, addresses and phone numbers constantly changed.
By late December 2011, more than 100 victims from California and other states had submitted complaints against the companies to various law enforcement agencies and better business bureaus, according to an OCDA statement.
It was then that Cunningham, Nolan and Silva are accused of launching a new fraud. Forged "Conditional Approval" letters with CitiFinancial or CitiMortgage logos in the letterhead were sent to distressed homeowners offered interest rates of 2.8 percent or lower to refinance their loans. "Escrow Instructions" attached to the letters directed the homeowner to deposit between $3,500 and $4,600 directly into the bank accounts of the accused.
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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