Federal Appeals Court OKs 23-Year Pokey Stay Given To Foreclosure Rescue Operator Who Screwed Over Three Dozen Victims (Financially Distressed Homeowners, Rent To Own Buyers, Investors) In Her Dubious Deals; Defendant: I Meant No Harm - It Was Just A Failed Business Venture

In Augusta, Georgia, The Augusta Chronicle reports:

• A former Augusta-area businesswoman was fairly tried and sentenced to more than 23 years in prison for a massive fraud based on a phony mortgage rescue operation, an appeals court has declared.
  
  In a six-page opinion [...], the 11th Circuit Court of Appeals affirmed Regina Preetor­ius’ convictions for mail fraud, wire fraud and money laundering.
  
  Preetorius was convicted by a federal court jury in September 2013 of 10 counts of mail and wire fraud and three counts of money laundering for operating a lengthy real estate and investment scam that was exposed by The Augusta Chronicle in 2008.
  
  Preetorius insisted at trial and during her sentencing hearing that she had no intention of harming anyone. She described what happened as a failed business venture.
  
  Preetorius ran a firm called SDA & Associates that had three components: obtaining the rights to property of distressed homeowners, finding buyers for lease-purchase agreements for those homes, and convincing investors that their money would be guaranteed safe and secured with the titles of properties.
  
  It was, however, little more than a Ponzi scheme that led to financial ruin for many of her 39 victims, who lost nearly $1.5 million.
  
  The federal appeals court noted that defendants face a high bar on appeal and that Preetorius couldn’t cross it. Based on the evidence at trial, a rational jury was entitled to disbelieve Preetorius’ claims of innocence, the court stated.
  
  The appeals court also found that U.S. District Court Judge J. Randal Hall was correct in increasing Preetorius’ punishment range because she was the leader of a criminal enterprise that involved six other participants, she controlled all aspects of SDA, she recruited others, her scheme lasted for several years and more than two dozen investors were cheated.
  
  The appellate court also agreed with Hall’s logic that Preetorius’ lengthy prison term was justified because of the scam’s sophistication, the great losses she caused and Preetorius’ refusal to accept responsibility for what she did.
  
  Preetorius, 48, is imprisoned at the federal prison in Tallahassee, Fla., a low-security facility housing more than 900 female inmates. According to the Federal Bureau of Prisons, her release date is Jan. 21, 2034.

Source: Appeals court upholds Regina Preetorius' conviction in real estate scam.

S. Georgia Feds Pinch Foreclosure Rescue Operator; Found In Arizona, Suspect Faces Charges Of Screwing Over Distressed Homeowners Out Of Their Equity, Investors

In Augusta, Georgia, the Augusta Chronicle reports:

• A former Augusta businesswoman has been indicted on federal charges of mail fraud and money laundering in connection with a “foreclosure rescue” business she ran.
  
  Regina M. Preetorius is scheduled to make her initial trip to U.S. District Court in Augusta next week. She faces 10 counts of mail fraud and three counts of money laundering. The indictment accuses Preetorius of cheating investors out of more than $1.7 million and defrauding homeowners trying to stave off foreclosures.
  
  The Augusta Chronicle first wrote about Preetorius and her company, SDA & Associates, in August 2008. Her foreclosure rescue business left a wake that included more than 40 foreclosure filings and about a dozen bankruptcies, including her own.
  
  According to the federal indictment, Preetorius solicited people to invest in SDA, saying the money would be used to buy houses from distressed homeowners, then the houses would be sold at a profit that would guarantee investors a minimum return of 12 percent.
  
  According to the indictment, Preetorius “misapplied the investors’ money and converted those funds to her own use” and “defrauded a number of distressed homeowners by using their homes without their authorization as collateral for investors’ loans.” The indictment says Preetorius and others ran the scheme from 2004 to 2009.
  
  People in danger of losing their homes were sought out and convinced that SDA could save them from foreclosure because its staff would work out a payment plan with the mortgage holders and sell the homes for them if they signed a “special power of attorney,” the indictment said. Preetorius then enticed investors to loan SDA money to purchase and renovate those homes, the indictment said.
  
  Investors were lured into a false sense of security because they were promised their money would be protected by legally recorded deeds. According to the indictment, they were also promised that the houses had sufficient equity to cover their investments and that each property’s value was assured by proper real estate appraisals. In reality, according to the indictment, there was neither.
  
  What investors didn’t learn until it was too late was that each home already had a mortgage from a financial institution that stood first in line for any value of the property, leaving their deeds worthless.
  
  Preetorius previously said she did nothing wrong and was trying to help homeowners. At one of her bankruptcy court hearings, she told investors that she got caught short by the real estate market crash.
  
  She and her husband, Charles, who also worked at SDA, filed for bankruptcy in 2008, claiming $2.47 million in liabilities and zero assets. Though there were several legal challenges to the bankruptcy petition by people who believed they were cheated out of money and homes, the couple’s debts were discharged by the court.
  
  According to court documents, the Preetoriuses moved to Arizona in 2009.

Source: Former Augusta businesswoman Regina Preetorius indicted on fraud, money laundering charges.

For earlier posts on this alleged racket, see:

• Civil Lawsuits Focus Spotlight On Augusta-Area Real Estate Operator; Questionable Transactions Resulted In 40+ Foreclosures,
• Lawsuit Alleges Rent-To-Own, Rent Skimming Scam Led To Foreclosure.

Civil Lawsuits Focus Spotlight On Augusta-Area Real Estate Operator; Questionable Transactions Resulted In 40+ Foreclosures

In Augusta, Georgia, The Augusta Chronicle, reports on local real estate operator, S.D.A. & Associates and its owner Regina Preetorius. Some of the firm's customers have filed lawsuits against them alleging that questionable transactions have resulted in the loss of their homes, and others claim that they invested money with the firm and the money is now unaccounted for:

• Three lawsuits have been filed against Ms. Preetorius accusing her of fraud and racketeering, and a number of people The Augusta Chronicle talked to who had dealings with S.D.A. say they, too, will be contacting attorneys.

• HERE'S WHY: According to the lawsuits and those who talked with The Chronicle , instead of helping people catch up with mortgages or sell their homes, Ms. Preetorius treated the property as her own and obtained second and third mortgages on the houses. Investors gave S.D.A. money in exchange for security deeds on the properties. The investors' security deeds are worthless, however, if the original mortgage lender forecloses and the equity in the house can only pay off that loan. And when the original mortgage lender forecloses, anyone living in the home is evicted.

***

• In S.D.A.'s wake are more than 40 foreclosures, 12 involving Ms. Preetorius or her various business entities,(1) and about a dozen people who went bankrupt. By the time Ms. Preetorious and her husband filed for Chapter 7 bankruptcy Aug. 4, she had been involved in the transfer of properties with a combined fair market value of more than $10.6 million. She had also persuaded investors to give her nearly $3.7 million in exchange for security deeds on properties.

For more, including the reported details of the allegations in some of the lawsuits, see Suits question real estate transactions (Owners say mortgage relief offers ended with foreclosures).

Go here for other posts and updates on this story.

(1) According to the story: Ms. Preetorious has had several businesses: Southeastern Holding Group, R.M.P. Holding Group, S.M.B. Holding Group, A.C.B. Holding Group, D.T.B. Holding Group, Preetoria Inc., and Omega Holding Group. The only business still licensed is S.D.A.

Lawsuit Alleges Rent-To-Own, Rent Skimming Scam Led To Foreclosure

In Augusta, Georgia, The Augusta Chronicle reports:

• Regina Preetorius blames the real estate market crash. A class action lawsuit filed in federal bankruptcy court says something else caused people who did business with her company, S.D.A. & Associates, to lose their investments and face eviction papers -- fraud.

***

• [Juan Valencia and Decia Bostic-Valencia] got kicked out of a house in south Augusta last year despite putting nearly $16,000 down, paying $4,000 to "loan broker" Fred Climer and making 12 monthly payments of $976, the lawsuit says. They thought that they were working toward home ownership in a rent-to-own, bond-for-title deal, [their attorney Jack] Long said. Unbeknownst to them, the complaint alleges, S.D.A. took their money while letting an outstanding mortgage on the house go unpaid, leading to foreclosure.(1)

For more, see Fraud involved in home deals, lawsuit claims.

Go here for other posts and updates on this story.

For more on problems with "Rent To Own" and Lease / Option real estate deals, go here and go here.

(1) According to the story, the lawsuit names Mrs. Preetorius, her husband, Charles "Greg" Preetorius, and Mr. Climer as defendants and seeks to create a class of plaintiffs who fell into predicaments similar to the Valencias. rent to own lease purchase option scams yellowstone