Tuesday, July 25, 2017

Jury Conviction Leads To Combined 39 Years In Prison For Trio For Roles In Loan Modification Racket That Screwed 3,000+ Financially Struggling Homeowners Out Of At Least $11 Million

From the Office of the Special Inspector General For The Troubled Asset Relief Program (Washington, D.C.):
  • Three California residents were sentenced today [July 19] to a combined 39 years in prison for their roles in a nationwide, multi-year “home mortgage modification” fraud that scammed thousands of vulnerable victims out of at least $11 million.

    Sammy Araya, 41, of Santa Ana, was sentenced to 20 years, Michael Henderson, 49, of Costa Mesa, was sentenced to 12 years, and Jen Seko, 36, of Anaheim, was sentenced to 7 years in prison, respectively. All three defendants were convicted by a federal jury on April 21, of multiple counts of mail fraud, wire fraud, and conspiracy to commit mail and wire fraud.

    “For Sammy Araya, Michael Henderson, and Jen Seko, the financial struggles of more than 3,000 homeowners were an opportunity for theft,” said Special Inspector General Christy Goldsmith Romero.
    ***
    According to court documents, from at least March 2011 through September 2014, Araya and his coconspirators targeted struggling homeowners and made a series of misrepresentations to induce them to make payments of thousands of dollars each in exchange for supposed “mortgage modification” assistance.

    The conspirators lured vulnerable victims into the scam through targeted mass mailers sent to homeowners facing foreclosure through Seko’s company, Seko Direct Marketing. In the mailers and in subsequent phone calls, the defendants and their co-conspirators falsely held themselves out as a nonprofit organization or as affiliated with a real government program, the Home Affordable Modification Program, designed to help homeowners at risk of foreclosure. Henderson and other “customer service representatives” in the scam convinced victims to send “reinstatement fees” and “trial mortgage payments” to the conspiracy, based on the false representations that the funds would be used to modify their mortgages. In reality, however, the defendants did nothing to help modify any mortgages.

    Instead, they used the victims’ payments for their own personal benefit and to further the fraud scheme. Araya, the ringleader of the scam, used the fraud proceeds to purchase expensive vehicles, a racehorse, and a variety of luxury goods, as well as to fund his personal travel and a reality television show he produced called “Make It Rain.TV.”
    ***
    Twelve defendants have been convicted in the Eastern District of Virginia in this case and a related case in connection with this same scam.

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