Wednesday, May 27, 2015

Manhattan Feds Pinch Trio In Alleged Conspiracy That Dangled Phony Loan Mod, Sham Short Sale Lease/Buyback Promises To Dupe Foreclosure-Facing Homeowners Into Signing Over Titles To Their Homes; Attorney Who May Have Link To Prior Predatory Scheme Lawsuit Among Those Bagged

From the Office of the U.S. Attorney (New York City):
  • Preet Bharara, the United States Attorney for the Southern District of New York, [and two others] announced that MARIO ALVARENGA, RAJESH MADDIWAR, and AMIR MEIRI were arrested [] for participating in a scheme to fraudulently induce distressed homeowners to sell their homes to a company associated with the defendants.

    ***

    FBI Assistant Director Diego Rodriguez said: “The defendants took advantage of distressed home owners, mostly the poor and elderly, promising relief. In reality it was nothing more than a callous scheme that took advantage of the most desperate of victims. And in many cases, the owners were evicted from their homes after being tricked into selling their property to the defendants arrested [].”

    Special Inspector General for SIGTARP said: “The three individuals taken into custody [] stand charged with preying on struggling homeowners simply looking for a way to keep their homes from falling into foreclosure. These individuals are alleged to have dangled false promises of guaranteed mortgage modifications as a veil for secretly swindling homeowners out of their homes and forcing homeowners to vacate their properties.

    ***

    According to the allegations in the Complaint unsealed [] in Manhattan federal court[1]:

    Since at least 2013, ALVARENGA, MADDIWAR, and MEIRI have defrauded distressed homeowners throughout the Bronx, Brooklyn, and Queens. ALVARENGA, MADDIWAR, and MEIRI falsely represented to these homeowners – some of whom were elderly or in poor health – that they could assist them with a loan modification or similar relief from foreclosure that would allow the homeowners to save their homes. But rather than actually assisting these homeowners, the defendants deceived them into selling their homes to Launch Development LLC (“Launch Development”), a for-profit real estate company also affiliated with the defendants.

    ALVARENGA, MADDIWAR, and MEIRI lured victims through the Homeowners Assistance Service of New York (“HASNY”), which purported to provide assistance to homeowners who were seeking to avoid foreclosure of their homes. As part of the scheme, MEIRI directed employees of Launch Development, a company owned in part by MEIRI, to solicit owners of distressed properties and invite them to meet with HASNY representatives so that they could learn more about avoiding foreclosure and saving their homes.

    When a homeowner arrived at the HASNY office, he or she met with ALVARENGA, who typically advised the homeowner that HASNY could assist him or her with a loan modification. In still other cases, ALVARENGA advised the homeowner that a loan modification could not be completed, but that the homeowner could engage in a type of short sale in which the homeowner would sell the property to a third party, Launch Development, and then within approximately 90 days arrange for a relative of the homeowner to repurchase the property from Launch Development. ALVARENGA typically explained that the homeowner could remain in his or her home throughout the entire process. ALVARENGA then typically scheduled a closing at which the homeowner would meet with MADDIWAR, who was described as the homeowner’s attorney for the transaction.(1)

    At the closing, a homeowner who had been led to believe that he or she was about to receive a loan modification or transfer his or her property to a trusted relative was encouraged to sign documents presented by MADDIWAR, which in some cases were blank. Unbeknownst to the homeowners, by signing the documents, they were selling to Launch Development the homes they had hoped to save. Homeowners often were then forced to vacate their homes soon thereafter.

    ***

    If you believe you were a victim of this crime, including a victim entitled to restitution, and you wish to provide information to law enforcement and/or receive notice of future developments in the case or additional information, please contact Wendy Olsen-Clancy, the Victim Witness Coordinator at the United States Attorney's Office for the Southern District of New York, at (866) 874-8900, or Wendy.Olsen@usdoj.govEmail links icon. For additional information, go to: http://www.usdoj.gov/usao/nys/victimwitness.html.
Source: Three Men Charged In Manhattan Federal Court In Multimillion-Dollar Scheme To Deceive Homeowners Into Selling Their Homes (Complaint Charges That Defendants Acting Through An Organization That Advertised Help To Those Seeking Loan Modifications To Avoid Foreclosure, Obtained Millions Of Dollars By Deceiving Homeowners Into Selling Their Homes).

For the formal charges, see USA v. Alvarenga, et al.

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(1) It appears that a New York City-area attorney named Rajesh Maddiwar was named in a 2004 civil lawsuit as a defendant in a civil lawsuit involving a real estate transaction in which he and other co-defendants were accused of playing roles in a predatory real estate scheme. Similar to this case, the Maddiwar in the 2004 case was alleged to have been by selected by one or more of his co-defendants to purportedly represent an ostensibly unwitting buyer in a real estate transaction that ultimately "went south" and became the subject of that suit. See Coveal v. Consumer Home Mortgage, Inc., No. 04-CV-4755 (ILG) (E.D.N.Y. 2005). I wonder if the NY-based attorney Rajesh Maddiwar in that case is the same NY-based attorney Rajesh Maddiwar named in this case?

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