Sacramento Feds Score Jury Verdict Over Brothers Who 'Headed' Up Nationwide Sale Leaseback-Peddling, Equity Stripping Foreclosure Racket; Most Co-Conspirators Copped Earlier Plea Deals; 2nd Prosecution Involving Separate Ripoff Remains Pending

From the Office of the U.S. Attorney (Sacramento, California):

• After a nearly four-week trial, a federal jury in Sacramento returned guilty verdicts against Charles Head, 36, of Pittsburg, Pa., (formerly of Los Angeles), and Jeremy Michael “Mike” Head, 33, of Huntington Beach, United States Attorney Benjamin Wagner announced. Both were convicted of conspiracy to commit mail fraud in connection with a nationwide “foreclosure rescue” scam. Charles Head was convicted of four counts of mail fraud, and Mike Head was convicted of two counts of mail fraud.(1)
  
  According to evidence presented at trial, Charles Head was the leader of a scam that, operating through an entity called Head Financial located in Orange County, between January 2004 and March 2006 netted more than $15 million in fraudulently obtained funds from scores of homeowners, many of whom were in California.
  
  On February 28, 2008, a federal grand jury indicted Charles Head, Mike Head and 14 other defendants with violations of mail fraud, conspiracy to commit mail fraud, and other charges. The grand jury narrowed the charges in a superseding indictment in 2010. The evidence at trial established that the defendants solicited homeowners facing foreclosure, promising them that they would help the homeowners avoid foreclosure and repair their credit.
  
  Instead, through misrepresentations, fraud and forgery, the defendants led the victims to complete transactions that substituted straw buyers for the victim homeowners on the titles of properties without the homeowners’ knowledge. These straw buyers were often friends and family members of the defendants. Once the straw buyers were on title to the homes, the defendants applied for mortgages to extract the maximum available equity from the homes. The defendants then shared the proceeds of the ill-gotten equity and the “rent” that the victim homeowners paid them. Ultimately, the victim homeowners were left with no home, no equity, and with damaged credit ratings.(2)

***

• A second indictment, returned March 13, 2008, charges Charles Head and six other defendants, including three not charged in the first indictment, with operating an additional “equity-stripping” scheme that netted approximately $5.9 million in stolen equity from 68 homeowners nationwide. That indictment alleges that Charles Head revised the original scheme by recruiting strangers via the Internet to act as straw buyers. Under this new scheme, the indictment alleges, he received approximately 97 percent of the stolen equity. His “sales agents” and employees, and the other defendants, allegedly received the remaining 3 percent of equity. Trial in that case is scheduled for September 9, 2013.
  
  Charles Head and Domonic McCarns were indicted in both indictments and are set for trial on the charges in the second indictment on September 9, 2013. Also charged in the second indictment and set for trial are: Keith Brotemarkle, 45, of Johnstown, Penn.; Benjamin Budoff, 44, of Colorado Springs; and Lisa Vang, 27, of Westminster. John Corcoran and Kou Yang were charged in both cases but have pleaded guilty.

For the U.S. Attorney press release, see Jury Returns Guilty Verdict For Nationwide Foreclosure Rescue Scam.

For the original indictments, see:

• Indictment - U.S. v. Head #1,
• Indictment - U.S. v. Head #2.

Go here for earlier posts on the Charles Head nationwide sale leaseback equity stripping ripoffs.

(1) According to the press release:

• Ten other defendants have pleaded guilty in this case, charges were dismissed against one, and three remaining defendants are set for trial on November 4, 2013.
  
  The following have pleaded guilty and are scheduled for hearings regarding their sentencing dates on July 24, 2013:
  
  Elham Assadi , aka Elham Assadi Jouzani, aka Ely Assadi, 33, of Irvine;
  Akemi Bottari, 31, of Los Angeles;
  Sarah Mattson, 30, of Phoenix;
  Omar Sandoval, 35, of Rancho Cucamonga;
  Xochitl Sandoval, 32, of Rancho Cucamonga;
  Andrew Vu, 42, of Santa Ana;
  Justin Wiley, 31, of Irvine;
  Kou Yang, 35, of Corona;
  John Corcoran, aka Jack Corcoran, 55, of Anaheim.
  
  Leonard Bernot, 54, of Laguna Hills, pleaded guilty and is scheduled to be sentenced on July 10, 2013.
  
  A jury trial is scheduled for the remaining defendants on November 4, 2013. Those defendants are Domonic McCarns, 36, of Brea; Joshua Coffman, 32, of North Hollywood; and Anh Nguyen, 39, of Los Angeles.

(2) For more on this type of foreclosure rescue ripoff, see:

• Criminal Prosecutions Of Sale Leaseback Peddlers In Equity Stripping Foreclosure Rescue Deals;
• Dreams Foreclosed: The Rampant Theft of Americans' Homes Through Equity-stripping Foreclosure 'Rescue' Scams (June 2005).

Sacramento Feds' Nationwide Investigation Of Charles Head Foreclosure Rescue Scam Largest Current Case In Office

Earlier this week, reports from the Asbury Park Press (Asbury Park, NJ) stated that the FBI is currently investigating a nationwide foreclosure scam allegedly mastermined by Charles Head of FundingForeclosure (also of Head Financial) affecting 256 properties stretching from Maine to Hawaii. A report indicates that the case is currently being investigated by the FBI office in Sacramento, California and that it is the largest case currently under investigation by that office. The report also indicates that of the 256 properties listed in a warrant to search the offices of FCO Inc., Costa Mesa, Calif., which is believed to be part of owner Charles Head's financial operation, at least 69 properties are in California. Reports also indicate that Charles Head's whereabouts are currently unknown. For more, see:

• Housing boom breeds mortgage schemes,
• Victims of scam face losing homes,
• Go here for other posts on foreclosure rescue operator Charles Head, Head Financial, and Funding Foreclosure.

For examples of Charles Head's online solicitations and personal profile, see:

• Charles Head - Business Profile,
• Charles Head - Investment Solicitation.

For more on equity stripping scams, generally,see DREAMS FORECLOSED: The Rampant Theft of Americans' Homes Through Equity-stripping Foreclosure 'Rescue' Scams (4.61 MB approx.).

Sacramento Feds Bag 19 Suspects In Alleged Nationwide Foreclosure Rescue, Equity Stripping Scam; Over $12+M Pocketed, 100+ Homes Involved -- So Far

(original post - 3-24-08)
In Sacramento, California, media reports from KNXV-TV Channel 15 (Phoenix) and KCRA-TV Channel 3 (Sacramento), as well as an announcement by United States Attorney McGregor Scott (Eastern District, CA) report that foreclosure rescue operator Charles Head and his brother, Jeremy Michael Head, the alleged ringleaders of what prosecutors describe as a nationwide straw buyer, equity stripping, foreclosure scam operation involving over 100 homes, have been indicted along with 17 others. The alleged scam involved targeting financially strapped homeowners and screwing them out of their home equity by offering bogus sale leaseback arrangements involving their homes that was purportedly design to save the homes from foreclosure.

According to Assistant United States Attorneys Laura Ferris, Rob Tice-Raskin, and Ellen Endrizzi, who are prosecuting the case, the charges are broken out into two separate indictments, "Head One" (2-28-08) and "Head Two" (3-13-08).

Reportedly, investigators have said that more indictments could soon be on the way, increasing the number of homes to more than 300 nationwide. The case, known as Operation Homewrecker, included an investigation by the FBI and IRS.

The following defendants were charged in the Feb. 28 "Head One" indictment:

1. Charles Head, 33, of Los Angeles
2. Jeremy Michael Head, 30, of Huntington Beach
3. Elham Assadi, aka Elham Assadi Jouzani, aka Ely Assadi, 30, of Irvine
4. Leonard Bernot, 51, of Laguna Hills
5. Akemi Bottari, 28, of Los Angeles
6. Joshua Coffman, 29, of North Hollywood
7. John Corcoran, aka Jack Corcoran, 52, of Anaheim
8. Sarah Mattson, 27, of Phoenix, Ariz
9. Domonic McCarns, 33, of Brea
10. Anh Nguyen, 36, of Los Angeles
11. Omar Sandoval, 32, of Rancho Cucamonga
12. Xochitl Sandoval, 29, of Rancho Cucamonga
13. Eduardo Vanegas, 28, of Phoenix
14. Andrew Vu, 39, of Santa Ana
15. Justin Wiley, 28, of Irvine
16. Kou Yang, 32, of Corona.

In the March 13 "Head Two" indictment, in addition to Charles Head, John Corcoran, Kou Yang and Dominic McCarns, who were all charged in "Head One" -- the following additional defendants were charged:

1. Keith Brotemarkle, 42, of Johnstown, Pennsylvania
2. Benjamin Budoff, 41, of Colorado Springs, Colorado
3. Lisa Vang, 24, of Westminster.

Friends and family members were recruited as straw buyers in "Head One," -- in "Head Two" the defendants recruited strangers via the Internet to act as the straw buyers.

For more, including the Arizona connection in this story, see KNXV-TV Channel 15: Mesa elementary school teacher indicted for federal fraud.

Go here for a U.S. map giving the location of the homeowners who were screwed over.

For the KCRA-TV Channel 3 story, see 19 Accused Of Mortgage Scheme (Struggling Homeowners Victimized, Officials Say).

For the U.S. Attorney's press release, see Indictments Announced In Major Mortgage Fraud Scheme.

For the criminal indictments, see:

• U.S. v. Head, et al. - Head #1,
• U.S. v. Head, et al. - Head #2.

Go here for earlier posts as well as available updates on the Head nationwide foreclosure rescue operation.

Thanks to Josh Bernstein and Tim McDaniel for the "Heads-Up" (so to speak) on this story.

-----------------------

For more on equity stripping scams, generally, see DREAMS FORECLOSED: The Rampant Theft of Americans' Homes Through Equity-stripping Foreclosure 'Rescue' Scams (4.61 MB approx.).

For other criminal prosecutions involving foreclosure rescue and other deed scams, see:

• Criminal Prosecutions Of Foreclosure Rescue Operators II, and
• Foreclosure Rescue - For Criminal Prosecutors Only.

Nationwide Foreclosure Rescue Operator Charles Head Back In The News

Another story on national foreclosure rescue operator under Federal investigation, Charles Head, has come out; this time coming from Sacramento, California, where The Sacramento Bee reports on his local operations:

• [Head's] alleged scam includes at least seven Sacramento homeowners and 61 statewide, and the probe is based in the Sacramento FBI office, according to court documents, interviews and an Internal Revenue Service search warrant obtained by The Bee. An additional 100 investors who believed they were helping people on the brink of foreclosure also may have been swept up in the alleged scheme, with many having their credit ruined.

***

• [F]ederal authorities say the [investigation] has evolved into money laundering, and Head says the FBI has seized cash and exotic vehicles from him. "We're still reviewing the evidence we got from searches in Los Angeles," Sacramento FBI spokesman Steve Dupre said. "We're still attempting to identify more victims and put the pieces together."

The deals sound like the typical sale leaseback, equity stripping, "straw buyer" arrangements. Head's deals were reportedly described by one New Jersey attorney who has filed a civil lawsuit against Head:

1. Homeowners were told they could sign their house over to a trust and live there while repairing their credit,
2. They would pay monthly rent to Head's companies and, after a year or two, could buy back their home at about the same price,
3. Head recruited "straw buyers" to take title to the homes in the equity stripping transaction without any management responsibilities; they simply would lend their good credit to the deal in return for "straw buyer" fees of between $5,000 to $40,000.
4. The investors were told they didn't have to make mortgage or tax payments because Head's companies would pay the mortgages,
5. The investors found out the mortgages had not been paid when they started getting default notices in the mail.

For more, including some of the reported details involving a couple of the Sacramento-area homeowners who were allegedly victimized by Head's deals as well as the Federal asset seizures of property confiscated from Head, see Home scam suspected (Local FBI office heads 'foreclosure rescue' fraud probe).

Go here for other posts on the Head nationwide foreclosure rescue operation.

Washington State Homeowner Sues To Void A "Charles Head-Orchestrated" Foreclosure Rescue Sale Leaseback

Andrews Publications reports:

• A victim of a mortgage fraud scheme is asking a Washington state court to declare that title to her home was not transferred to Deutsche Bank National Trust Co. in a foreclosure action. Seattle homeowner Phyllis Reynolds wants the King County Superior Court to declare that the defendant bank's title to her home is void.

• Reynolds sued Deutsche Bank, its agent Northwest Trustee Services Inc. and escrow company First American Title Insurance Co. after learning that the loan she took out to refinance her mortgage was fraudulent. The suit also names as defendants Donald and Linda Theriault, a married couple whose identities were allegedly stolen and used by con artist Charles Head to defraud Reynolds. Head is not named in the lawsuit.

***

• Reynolds says that since she was not a Deutsche Bank customer and was the victim of a scam, the bank's title to her home is void and the foreclosure conducted by Northwest Trustee Services is a nullity. Reynolds also says any transfer of the title to the Theriaults is void as well. She seeks a declaration that title to the property belongs to her. Reynolds is also seeking unspecified damages from First American on the grounds that the company breached its fiduciary duty when serving as the escrow agent during the fraudulent loan closing.

Charles Head entities that are allegedly involved in this case are Funding Foreclosures (aka FundingForeclosures), Nations Property Management, and A-One Investment Management Inc. For more, see Woman Sues to Keep Home After Mortgage Scam.

Case Filing Information: Reynolds v. Theriault et al., No. 07-2-29304-3, complaint filed (Wash. Sup. Ct., King County Sept. 6, 2007).

Go here for other posts on foreclosure rescue operator Charles Head, Head Financial, and related companies.

For more on equity stripping scams, generally,see DREAMS FORECLOSED: The Rampant Theft of Americans' Homes Through Equity-stripping Foreclosure 'Rescue' Scams (4.61 MB approx.).

Sale Leaseback Peddler Gets Ten Years In Equity Stripping, Foreclosure Rescue Ripoff While Co-Defendant/Brother Lands 35 Years Prison Stay As Mastermind Of Scam That Netted $15M+ From Unwitting Homeowners

From the Office of the U.S. Attorney (Sacramento, California):

• Jeremy Michael “Mike” Head, 34, of Huntington Beach, was sentenced [] to 10 years in prison for a nationwide foreclosure rescue scam, United States Attorney Benjamin Wagner announced.
  
  A federal jury found him guilty in May 2013, after a nearly four-week trial before United States District Judge Kimberly J. Mueller. Mike Head’s brother and co-defendant Charles Head, 40, was sentenced in September 2014 by Judge Mueller to 35 years in prison.(1)
  
  According to evidence presented at trial, Mike Head played an important leadership role in a fraud scheme that promised to help homeowners avoid foreclosure and repair their credit. He recruited and managed other members of the scheme. Through misrepresentations, fraud and forgery, the Head brothers and their associates substituted straw buyers for the victim homeowners on the titles of properties without the homeowners’ knowledge.
  
  These straw buyers were often friends and family members of the defendants. Once the straw buyers were on title to the homes, the defendants applied for mortgages to extract the maximum available equity from the homes. The defendants then shared the proceeds of the ill-gotten equity and the “rent” that the victim homeowners paid them.
  
  Ultimately, the victim homeowners were left with no home, no equity, and with damaged credit ratings. Between January 2004 and March 2006, the scam netted more than $15 million in fraudulently obtained funds from scores of homeowners, many of whom were in California.
  
  U.S. Attorney Wagner said: “Mike Head made a small fortune taking advantage of victims who looked to him for help. Instead of helping, he stole the last remaining equity in their homes, and many victims were evicted and left destitute. He will now go to prison and pay for his crimes. This office continues to vigorously prosecute multiple variations of mortgage fraud throughout our district.”
  
  “The scheme Head and his co-conspirators devised preyed upon individuals when they were most vulnerable and lived in fear of imminent foreclosure. Despite promises to help their victims avoid foreclosure, many were financially devastated by the scheme,” said Special Agent in Charge Monica M. Miller of the Sacramento FBI. “The FBI is committed to thoroughly investigating complex mortgage fraud schemes, identifying all participants, and ensuring that those who have violated the trust of the American public face justice in federal court.”(2)
  
  "[This] sentencing sends a clear message to those who commit mortgage fraud, the consequences can be severe,” said Acting Special Agent in Charge Thomas McMahon, IRS-Criminal Investigation. “The defendants in this case have hurt so many people and so many of our communities. This sentencing highlights IRS-CI's commitment to hold accountable those involved in these types of crimes."
  
  This case is the product of an investigation by the Federal Bureau of Investigation and the Internal Revenue Service – Criminal Investigation. Assistant United States Attorneys Michael D. Anderson and Matthew Morris are prosecuting the case.
  
  This case began on February 28, 2008, when a federal grand jury indicted Mike Head, his brother Charles Head, and 14 other defendants with violations of mail fraud, conspiracy to commit mail fraud, and other charges. Eleven of Heads co-defendants have entered guilty pleas, and charges were dismissed against one.
  
  Charges against the two remaining defendants, Domonic McCarns, 37, of Brea, and Anh Nguyen, 40, of Los Angeles are pending. The charges are allegations; the defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.

Source: Huntington Beach Man Sentenced To 10 Years In Prison For Nationwide Foreclosure Rescue Scam.

Go here for earlier posts on this story.

Footnote

(1) See 35 Year Prison Sentence For Nationwide Foreclosure Rescue Scam.

(2) For more on this type of foreclosure rescue ripoff, see:

• Criminal Prosecutions Of Sale Leaseback Peddlers In Equity Stripping Foreclosure Rescue Deals;
• Dreams Foreclosed: The Rampant Theft of Americans' Homes Through Equity-stripping Foreclosure 'Rescue' Scams (June 2005).

Equity Stripper Ordered To Return Deed To Home To New Jersey Resident; Status Of Existing Mortgages Up In The Air

In Ocean County, New Jersey, the Asbury Park Press reports on a local homeowner who found herself unwittingly signing away her home in another bogus Charles Head-orchestrated sale leaseback deal:

• Marie Citarella said she never wanted to sell her house. But land records show Citarella signed a "warranty deed" to Michael and Deanne Mattice of Colorado Springs, Colo., transferring the property for nothing, and thus paying no real estate transfer taxes. The Mattices, in turn, took out two mortgages on the property for a total of $204,250, according to documents. Neither the Mattices or their attorney could be reached for comment. However, a letter to Citarella from the Mattices' attorney said the couple was working with the U.S. Attorney's Office in Sacramento, Calif.,which is leading the investigation, and expressed the couple's intention to return the property to her.

Citarella said that Charles Head, a principal in FundingForeclosure (aka Funding Foreclosure), attempted to evict her in June 2007, but an attorney representing Head dropped the case after reviewing Citarella's paperwork. The attorney said he no longer represents Head or his companies and declined to comment further.

The home went into foreclosure, and while the local judge in Toms River, New Jersey ordered the Mattices to reconvey the title to the home to Citarella, it appears that the foreclosure action is continuing, though the judge did give Citarella a 30 day stay. For more, see Defrauded woman fights to stay in house she didn't intend to sell.

Go here for other posts on foreclosure rescue operator Charles Head.

For more on equity stripping scams, generally, see DREAMS FORECLOSED: The Rampant Theft of Americans' Homes Through Equity-stripping Foreclosure 'Rescue' Scams (4.61 MB approx.).

Feds Investigating Nationwide Foreclosure Rescue Scam

A national foreclosure rescue scam has ensnared hundreds of victims in 27 states, including at least 17 homeowners in New Jersey, according to a story in the Asbury Park Press (Asbury Park, New Jersey). Among the New Jersey victims who unwittingly signed away title to their homes in purported sale leaseback arrangements are two mothers in Ocean County and a widow in Middlesex County. A disabled Vietnam veteran in Delaware also claims to be among the defrauded. According to the story:

• An IRS search warrant obtained by the Press lists 256 affected properties stretching from Maine to Hawaii. The warrant identified 106 homeowners as victims and 99 third-party, or straw, buyers, who may have unwittingly propelled the fraud forward. Two dozen companies are also named, but it is unclear what their roles were in the investigation. An FBI spokesman and an IRS agent last week confirmed the investigation into the companies and people behind what had been touted as a way for small investors to save financially strapped homeowners.

• "It is a large and significant case," FBI spokesman John Cauthen said. "We're investigating with the full force and weight of the FBI." Cauthen said no charges have been filed. Nonetheless, the FBI has sent letters to homeowners and investors to inform them they are victims.

• Those letters identified Charles Head, operator of the now-defunct FundingForeclosure.com, as the focus of the investigation. Head could not be reached for comment. Private attorneys representing the victims said Head, believed to be from Florida, cannot be located.

Reportedly, the FBI letters have been helpful to some in that a couple of the victims have successfully used the letters to convince judges to postpone ongoing foreclosure proceedings. For more, see Victims of scam face losing homes.

For related stories on two of the New Jersey victims, see:

• Defrauded woman fights to stay in house she didn't intend to sell,
• Son aims to buy home.

Go here for an earlier report from Hawaii on the Charles Head FBI investigation.

Go here for other posts on foreclosure rescue operator Charles Head.

For more on equity stripping scams, generally, see DREAMS FORECLOSED: The Rampant Theft of Americans' Homes Through Equity-stripping Foreclosure 'Rescue' Scams (4.61 MB approx.).

Charles Head Nationwide Foreclosure Rescue Scam Nicks Arizona

The Arizona Republic reports:

• Seven Arizona properties are part of a "foreclosure rescue" mortgage scam that snared hundreds of victims in 27 states, according to an Internal Revenue Service warrant. An IRS search warrant obtained by the Asbury Park Press of New Jersey lists 256 affected properties stretching from Maine to Hawaii. The warrant identified 106 homeowners as victims, so luckily Arizona wasn't this scam's main focus. The FBI has sent letters to homeowners and investors about the scam. Those letters identify Charles Head, who ran FundingForeclosure.com, as the focus of the investigation.Three of the Valley properties named as part of the investigation are in Phoenix. Two of the homes are in Mesa. One is in Cave Creek, and the other is in Litchfield Park.

From: The Arizona Republic - Foreclosure Scam (2nd story from top).

Go here for other posts on foreclosure rescue operator Charles Head, Head Financial, Funding Foreclosure and related companies.

For more on equity stripping scams, generally,see DREAMS FORECLOSED: The Rampant Theft of Americans' Homes Through Equity-stripping Foreclosure 'Rescue' Scams (4.61 MB approx.).

Hawaii Feds Investigate Alleged Foreclosure Rescue Scams

In Hawaii, a couple who are recent victims of a foreclosure rescue scam has reportedly been informed by the FBI that it is investigating 200 fraud cases against Head Financial Services and Charles Head, according to a story in the The Kauai Garden Island News. According to the story:

• "[The couple] said they became victims of a mortgage solicitor who encouraged homeowners to convey their property to [Head Financial] with the promise that after one year, the couple could secure a lower-interest mortgage loan that would allow them to buy back their home. But instead of that happening, the house was conveyed to an employee of Head Financial who subsequently conveyed it to another person who became the owner, the Kaua‘i family alleges."

The victims allege that Twyus Peahu and Bunny Mattice- Clevenger were also involved and worked together to defraud them of their home.

A foreclosure sale of the home was cancelled due to questions about the ownership of the home, according to the couple's Big Island attorney, George Zweibel, a former Federal Trade Commission attorney who specializes in mortgage servicing and foreclosure rescue scams. Reportedly, he plans to file a lawsuit in state court soon against those connected with Head Financial. He, along with Honolulu attorneys Derek Kobayashi and Mihoko Ito, have recently filed a lawsuit on behalf of two other local homeowners claiming they were victimized in the same way.

For more, see Couple say they lost home to fraud.

Go here for other posts on Charles Head.

More On Sacramento Equity Stripping, Sale Leaseback, Foreclosure Rescue Bust

In Sacramento, California, The Sacramento Bee reports on the announcement of the indictment of foreclosure rescue operator Charles Head, his brother Jeremy Michael Head, and 17 others for allegedly screwing over homeowners facing foreclosure from Maine to Hawaii with "sale leaseback" home equity scams:

• The case – the largest equity-skimming scam in the country – affected about a half-dozen Sacramento-area residents and came to an FBI agent's attention when a North Highlands victim reached an FBI economic crimes agent who was taking calls from the complaint line. "(The agent) called Head, and based on call the agent believed there was something to this," Assistant U.S. Attorney Ellen Endrizzi said.

***

• The defendants reached out to people on the brink of foreclosure, offering them the chance to keep their homes and pay rent for them while repairing their credit. Those who agreed were presented with a hefty pile of paperwork that included blank spaces that were filled in later, giving a "straw buyer" title to their homes.

***

• Kevin Carlin, a New Jersey attorney who has spoken with about 70 victims of Head's alleged fraud, said the scam targeted elderly and disabled people facing financial strain after job loss and illness. "I trust that some people will be leaping for joy today," Carlin said. "Even if they lost title to their house, Mr. Head may be required to pay for it with his liberty." Carlin said one of Head's former employees testified in a deposition that Head took an entire office full of workers to Hawaii. [... Ass't. U.S. Attorney Endrizzi] said Head faces about 30 civil lawsuits filed from Hawaii to New Jersey.

For more, see 19 indicted in massive mortgage fraud case (Indictments allege massive mortgage fraud targeting homeowners near foreclosure).

For others stories, see:

• Reuters: Charges laid in alleged nationwide mortgage scam,
• Press Enterprise: Calif. prosecutors indict 19 in mortgage fraud scheme,
• Los Angeles Times: Houses stolen in mortgage fraud, indictments allege (reports that prosecutors said they found victims of the mortgage scam in California, Oregon, Washington State, Nevada and at least 14 other states. Also reports that Jeremy Michael Head's court-appointed attorney, Christopher Haydn-Myer, described his client as making a modest living at an auto maintenance shop. He said Head rides to work by bicycle because "he doesn't even own a car.")

Last Of 17 Defendants Gets 14 Years Prison Time For Role In Sale Leaseback, Equity Stripping Racket That Duped Over 300 Foreclosure-Facing Homeowners Into Signing Over Their Homes In Exchange For False Promises Of Foreclosure Rescue

From the Office of the U.S. Attorney (Sacramento, California):

• On Wednesday, September 14, 2016, Domonic McCarns, 41, of Irvine, was sentenced to 14 years in prison by U.S. District Judge Kimberly J. Mueller for conspiracy to commit mail fraud for his participation in a nationwide foreclosure-rescue scam, Acting U.S. Attorney Phillip A. Talbert announced.
  
  McCarns is the final defendant to be sentenced for a pair of schemes that lured homeowners with the promise to help them avoid foreclosure and repair their credit. Two indictments were brought in 2008. Four defendants were convicted after two jury trials, 13 defendants pleaded guilty, and now, all 17 defendants have been sentenced. On September 9, 2013, Charles Head was sentenced to 35 years in prison, and on October 29, 2014, his brother and fellow leader in the scheme Jeremy Michael Head was sentenced to 10 years in prison.(1)
  
  Acting U.S. Attorney Talbert said: ‘This scheme purposely targeted the financially vulnerable during their time of greatest distress with promises of help. The defendants tricked the victims into handing over their most valuable assets, their homes. Few economic crimes are more reprehensible. This final sentence in this case will bring some measure of justice for their victims.”
  
  ***
  According to court documents, the defendants solicited homeowners facing foreclosure, and through misrepresentations, fraud, and forgery, substituted straw buyers for the victim homeowners on the titles of properties without the homeowners’ knowledge. These straw buyers were often friends and family members of the defendants, or were solicited on the internet. Once the straw buyers were on title to the homes, the defendants applied for mortgages to extract the maximum available equity from the homes. The defendants then shared the proceeds of the ill-gotten equity and the “rent” that the victim homeowners paid them. Ultimately, the victim homeowners were left with no home, no equity, and with damaged credit ratings.
  
  Initially, the scam focused on distressed homeowners in California before expanding throughout the United States. In the course of the schemes, between January 2004 and June 2006, the defendants obtained over $90 million in fraudulent loans, caused estimated losses of over $50 million, and stole title to over 300 homes.
  
  On December 2, 2013, McCarns was convicted after a five-week trial along with Charles Head, 36, of Pittsburgh, Pennsylvania, (formerly of Los Angeles); and Benjamin Budoff, 46, of Colorado Springs, Colorado. Head had been previously convicted in a trial in a nearly four-week trial in May 2013 with his brother Jeremy Michael Head, 34, of Huntington Beach.

Source: Final Defendant Sentenced to 14 Years in Prison for Nationwide Foreclosure Rescue Scam (Over $90 Million in Fraudulent Loans and Hundreds of Homes Stolen from Homeowners).

---------------------------

(1) Fourteen other defendants have been sentenced:

1. Elham Assadi, 39, of Irvine, sentenced to 5 years’ probation with 6 months of home detention;
2. Leonard Bernot, 50, of Laguna Hills, sentenced to 18 months in prison;
3. Akemi Bottari, 36, of Los Angeles, sentenced to 3 years’ probation with 6 months of home detention;
4. Keith Brotemarkle, 51, of Johnstown, Penn., sentenced to 5 years, 10 months in prison;
5. Benjamin Budoff, 49, Colorado Springs, Colo. sentenced to 4 years in prison;
6. Joshua Coffman, 37, of North Hollywood, sentenced to 20 months in prison;
7. John Corcoran, 61, of Anaheim, sentenced to 4.5 years in prison;
8. Sarah Mattson, 33, of Phoenix, Ariz., sentenced to 3 years’ probation with 3 months of home detention;
9. Omar Sandoval, 36, of Rancho Cucamonga, sentenced to 4 years and 10 months in prison;
10. Xochitl Sandoval, 37, of Rancho Cucamonga, sentenced to 8 months in prison;
11. Lisa Vang, 31, of Westminster, sentenced to 3 years’ probation;
12. Andrew Vu, 38, of Santa Ana, sentenced to 6 months in prison with 6 months of home detention;
13. Justin Wiley, 37, of Irvine, sentenced to 18 months in prison, and
14. Kou Yang, 40, of Corona, sentenced to 4 years in prison.

Sale Leaseback Peddler Cops Plea For Role In 'Head' Nationwide Equity Stripping Foreclosure Rescue Scam

From the Office of the U.S. Attorney (Sacramento, California):

• [L]eonard Bernot, 46, of Laguna Hills, pleaded guilty [] to conspiracy to commit mail fraud for his part in a wide-ranging "foreclosure rescue" scheme involving Head Financial Services Inc.
• Originally indicted on February 28, 2008, Bernot and 10 other defendants were charged with conspiring to defraud financially distressed homeowners by promising them that their homes could be saved from foreclosure and their credit repaired if the names of straw buyers were added to, or replaced on, the homes' property titles.(1)
• Bernot and others allegedly would obtain mortgage loans on each of the homes, thereby extracting substantial equity, a scheme sometimes referred to as "equity stripping."
• Often, the homeowners were left paying "rent" to the conspirators. The rent would often be nearly as much as the prior mortgage payment the homeowner had been unable to pay. When the homeowners were unable to keep up with the payments, they were often evicted from their homes.
• The cases of several co-defendants, including Charles Head, the founder of Head Financial Services Inc., are still pending. [...] Bernot will be sentenced [] on September 1, 2011.

For the U.S. Attorney press release, see U.S. Attorney Announces Results of Mortgage Fraud Prosecutions in 12 Months Since Operation Stolen Dreams.

Go here for other posts on the Head nationwide foreclosure rescue operation.

(1) For the criminal indictments, see:

• U.S. v. Head, et al. - Head #1,
• U.S. v. Head, et al. - Head #2.

Another Alleged Foreclosure Rescue, Equity Stripping Scam Victim Points Finger At Head Brothers

In Lawndale, California, The Daily Breeze reports on the story of an area couple who say they were ripped off out of their home equity in an alleged foreclosure rescue scam by a guy named "Mike" and "Mike's" brother. According to the story:

• "Mike" was Jeremy Michael Head, 30, of Huntington Beach. He is now awaiting trial on a 13-count indictment for mail fraud, money laundering and other related offenses. Head and 15 others were indicted Feb. 28, charged with fraudulently taking $6.7 million.

• Head's brother, Charles Head, was the alleged ringleader of the scheme. He was indicted a second time on March 13 with six others. He is accused of orchestrating an "equity stripping" scheme that netted $5.9 million. More than 300 known victims and 150 homes were involved in the fraud, said Lauren Horwood, a spokeswoman for the U.S. Attorney's Office.

For more, see Lawndale couple counts cost of home fraud (Clark family hoped to reduce payments, but refinancing became nightmare).

Go here for other posts on the Head nationwide foreclosure rescue operation.

Phoenix-Area Head Foreclosure Rescue Operation Under Federal Scrutiny

(original post - 12-22-07)
In Phoenix, Arizona, we find investigative reporter Josh Bernstein, now with television station ABC 15, shining the spotlight on another apparently shady real estate operation. This time, the company in the spotlight is Mesa-based Financial Enterprises LLC, a foreclosure rescue operation involving Jeremy Michael Head and his business partners.

The focus of the report is an equity stripping transaction, under the guise of a home sale and leaseback, that one local homeowner facing foreclosure unwittingly entered into after turning to Financial Enterprises for help. The homeowner has since filed a lawsuit alleging fraud against the company, naming among others, Jeremy Michael Head, his brother Charles Head, mortgage broker Sonny Rock, and straw buyer Sarah Mattson, who ended up on the title to the victim's home, as defendants.

This operation is reportedly part of the nationwide operation that is currently under criminal investigation. An excerpt from the story:

• According to documents obtained by the Investigators the FBI has raided several offices across the country, including the offices of Financial Enterprises LLC in Mesa, Arizona. The FBI has seized lavish sports cars, thousands of documents and a condominium in Miami as well. Sarah Mattson's attorney tells ABC15 "the United States Attorney and the FBI have told me there is no doubt my client is going to be indicted."

***

• The Investigators have learned there are more than 350 victims nationwide, involving more than thirty five million dollars in fraud. The FBI's investigation involves homes from Hawaii to New Jersey. There are more than a dozen victims here in Phoenix and the surrounding area.

For more, including the link to watch the ABC 15 video report, see Valley teacher, former business partners tied to federal mortgage probe.

Go here to read more about the key players in this investigation.

Go here for other posts on the Head nationwide foreclosure rescue operation.

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Go here for earlier posts and links to media reports on a series of investigative reports by Josh Bernstein, then with KCRA 3 in Sacramento, that led to a break up of a local mortgage fraud ring and the Federal indictments of the ring operators.

Pennsylvania Victim Of Nationwide "Operation Homewrecker" Sale Leaseback Foreclosure Rescue Scam About To Lose Home To Foreclosure

In Chester County, Pennsylvania, The Philadelphia Inquirer reports:

• Nothing short of a miracle, it seems, will keep Melissa Miller in the house in Honey Brook, Chester County, that has been part of her family for more than a century. Despite her best efforts, it goes to sheriff's sale Thursday. The house is Miller's home, but she has not owned it since 2006, when she tried to save it with an "unconventional refinancing" and ended up being scammed out of the legal title to the property.

• Miller, 40, is one of 350 victims of a complicated mortgage-fraud scheme federal prosecutors have dubbed "Operation Homewrecker."(1) [...] "I literally gave my house to these people without knowing," Miller said in an interview. "I never had any intention of losing my house, let alone selling it."

• From 2004 to 2006, the mortgage-fraud scheme entangled homeowners who were in financial trouble. "These are not people who overextended themselves and bought McMansions," said U.S. Attorney Ellen V. Endrizzi, one of the government prosecutors handling the case. "These are people who fell on hard times. It's so heartbreaking because nothing can be done for them."

For more, see Mortgage scheme costing Chesco woman her home.

(1) According to the story, the alleged sale leaseback, foreclosure rescue equity stripping scam was led by Charles Head of Los Angeles, and there are currently 16 defendants remaining from two 2008 Federal indictments (for the original indictments, see U.S. v. Head, et al. - Head #1, and U.S. v. Head, et al. - Head #2). All defendants have opted for jury trials, according to documents filed March 5 in U.S. District Court for the Eastern District of California in Sacramento. Charges against them include mail fraud and conspiracy to commit mail fraud, money laundering, and related offenses, U.S. Attorney Ellen V. Endrizzi said. Though some defendants already have pleaded guilty, trials for the others probably will not start until May 2011, the story states.

Go here for more on the Sacramento, California Feds "Operation Homewrecker" nationwide investigation into the alleged scam that targeted homeowners in dire financial straits, fraudulently obtaining title to over 100 homes and stole millions of dollars through fraudulently obtained loans and mortgages, and here for other posts on this alleged foreclosure rescue scam.

Financially Strapped Orlando-Area Homeowner Unwittingly Signs Over Deed To Home In Sale Leaseback, Rescue Deal

In Orlando, Florida, a story by the Orlando Sentinel that came out in June reported on another Charles Head sale leaseback deal gone bad:

• If you're not careful, homeowner Arthur Washington warned Wednesday, your house may be the next to go. [...] Washington, 59, said he was surprised how easily he was persuaded to give up the title to his home. When he and his elderly mother moved here from Massachusetts, Washington said, he wanted the kind of house often showcased in glossy magazines. But when his mother spotted the coffee-colored three-bedroom house on Montague Place in Pine Hills, she fell in love. The pair bought the home in 2003. Then the 2004 hurricanes hit, bringing water damage and a long wait for insurance money. In early 2005, bankruptcy and foreclosure loomed briefly but were avoided. But Washington was never quite able to catch up financially.Washington, who has poor credit, found a loan he thought would help keep him afloat. A lender told Washington he would hold the title to the home if Washington paid $600 a month in rent for one year. When the year was up, Washington could refinance his home. It didn't work out that way. Instead, in 2006, the lender sold Washington's home to an investor, who was unaware of the situation. Washington is still living in the house.

• The Federal Bureau of Investigation already is looking into the actions of Charles Head, the lender who dealt with Washington. Meanwhile, Washington is searching for a lawyer to help him regain ownership of his home.

For more, see Foreclosures fly through roof, or go here for the same story.

For more on equity stripping scams, generally, see DREAMS FORECLOSED: The Rampant Theft of Americans' Homes Through Equity-stripping Foreclosure 'Rescue' Scams (4.61 MB approx.).

More On The FBI's "Operation Homewrecker" Foreclosure Rescue Investsigation

CNBC reports:

• It doesn't get much sadder than the "funny business" I'm reporting today. More than a hundred homeowners in 23 states have lost their homes, not because they intentionally stopped paying their mortgages, but because the company which promised to help them instead may have robbed them blind. Charles Head ran a financial services company in Orange County, California. He is now charged with being the ringleader in what a federal investigation has dubbed "Operation Homewrecker."

For more, see "Operation Homewrecker" May Be Lowest Blow Of Housing Crisis.

Go here for earlier posts as well as available updates on the Head nationwide foreclosure rescue operation.

Sloppy Loan Servicer Applies House Payments To Wrong Loan, Throwing Home Into Foreclosure; Nationstar Ignores Homeowner's Complaint, Then Quickly Reverses Course When Local Media Consumer Troubleshooter Intervenes, Begins Asking Questions

In St.Charles County, Missouri, KMOV-TV Channel 4 reports:

• A mortgage mistake nearly cost a St. Charles County woman her condo.
  
  Kathleen Rasmussen claims she paid Texas based Nationstar each month. "I don't want to lose the roof over my head, I should not be in foreclosure."
  
  Rasmussen provided News 4 with letters from Nationstar along with returned checks intended to pay her mortgage. "I don't understand why they keep sending it back to me."
  
  A Kansas City law firm representing Nationstar sent Rasmussen a letter saying their office would "commence foreclosure proceedings."
  
  After trying to resolve the issue on her own, Rasmussen contacted News 4 Investigates. "We're going round and round in circles and we're not getting anywhere," she said.
  
  A Nationstar representative followed up with Rasmussen immediately after hearing from News 4. Rasmussen said, "right after that the VP of Nationstar called me and wanted to settle it right away.
  
  As it turns out, Rasmussen held two mortgages with Nationstar. According to an email from a Nationstar employee to Rasmussen's daughter, "the payments were all applied to the second mortgage."
  
  Because the payments were only being applied to her second loan, loan number one was in default.
  
  After discovering the error, Nationstar agreed to waive four mortgage payments and to eliminate all fees associated with foreclosure proceedings. Rasmussen's account is now current, she is no longer facing foreclosure.
  
  Nationstar recommends writing your account number on each mortgage check to avoid a similar problem.

Source: Mortgage mistake nearly leads to foreclosure.

Resigned From State Bar With Charges Pending, Ex-California Attorney Cops Guilty Plea For Role In Loan Modification Racket; Used Boiler Room Telemarketing Scam Masquerading As Reputable Law Firm To Fleece Financially Strapped Homeowners Out Of Million$; Two Co-Defendants To Face Trial

From the U.S. Department of Justice (Washington, D.C.):

• The Department of Justice announced that a former California licensed attorney pleaded guilty in U.S. District Court in Santa Ana, California, for his role in a multi-million dollar fraudulent mortgage modification scheme.
  
  Ronald Rodis, 51, of Irvine, California, pleaded guilty before U.S. District Court Judge David O. Carter for the Central District of California to one count of conspiracy to commit mail and wire fraud.
  
  ***
  “This defendant posed as an accomplished attorney who could provide quality legal services – and hope – to struggling homeowners,” said U.S. Attorney Eileen Decker of the Central District of California. “But the promises were bogus. Rodis Law Group made few efforts to assist homeowners, who paid thousands of dollars in last-ditch attempts to keep their homes, many of which entered foreclosure.”
  
  Rodis admitted that, between October 2008 and June 2009, he participated in a scheme with Bryan D’Antonio, Charles Wayne Farris, and others to induce homeowners to pay between $3,500 and $5,500 for the services of the Rodis Law Group (RLG).(1)
  
  Rodis and his co-conspirators made numerous misrepresentations regarding the RLG’s ability to negotiate loan modifications from the homeowners’ mortgage lenders. Rodis recorded radio advertisements encouraging struggling homeowners to call RLG. In the radio ads, Rodis falsely claimed that RLG consisted of “a team of experienced attorneys” who were “highly skilled in negotiating lower interest rates and even lowering your principal balance.”
  
  In fact, RLG was a telemarketing operation that never had a team of experienced attorneys. During much of the scheme, Rodis was the only attorney at RLG.
  
  ***
  Rodis’s co-defendants, Bryan D’Antonio and Charles Wayne Farris, are each charged with 10 felony counts – nine counts of wire fraud and one count of conspiracy. Each of these counts carries a statutory maximum penalty of 20 years in prison. In addition, D’Antonio is charged with 13 counts of criminal contempt for violating a 2001 federal court order, which permanently banned D’Antonio from participating in future telemarketing operations. Criminal contempt of court has no statutory maximum penalty. D’Antonio and Farris are scheduled for trial beginning Sept. 20.

Source: Former Attorney Pleads Guilty to Participating in Fraudulent Mortgage Modification Scheme.

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(1) Rackets of this type have played a key role in driving the State Bar of California's Client Security Fund (which purports to help alleviate clients' losses resulting from the dishonest conduct of their attorneys) into insolvency. See Golden State's Head Auditor Rips California Bar (For, Among Other Things, Screwing The Already-Screwed Victims Of Dishonest Lawyers By Stiffing Them Through Its Currently-Insolvent Client Protection Fund, Obscuring Fact That Payout Estimates Approach $19 Million While 2015 Year-End Cash Balance Sits At Only $2.2 Million; Victims Can Be Left Sucking Wind For Years Before Claims Are Paid).

For similar "attorney ripoff reimbursement funds" that sometimes help cover the financial mess created by the dishonest conduct of lawyers licensed in other states and Canada, see:

• Directory Of Lawyers' Funds For Client Protection (now includes Canadian recovery funds, courtesy of the American Bar Association);
• Check the USA Client Protection Funds Map;
• Check the Canada Client Protection Funds Map.

Maps available courtesy of The National Client Protection Organization, Inc.  attorney ripoff reimbursement fund